Fugate v. Walker

• Decision Date: 10 October 1924
• Citation: 265 S.W. 331,204 Ky. 767
• Parties: FUGATE v. WALKER.
• Court: Kentucky Court of Appeals

265 S.W. 331

204 Ky. 767

FUGATE v. WALKER.

Court of Appeals of Kentucky.

October 10, 1924

Appeal from Circuit Court, Livingston County.

Action by H. D. Walker against W. J. Fugate. Judgment for plaintiff and defendant appeals. Affirmed.

Charles Ferguson, of Smithland, for appellant.

Charles H. Wilson, of Smithland, for appellee.

O'NEAL J.

On August 7, 1922, appellee, H. D. Walker, instituted this action in ejectment against appellant, W. J. Fugate, seeking to recover possession of a described house and lot located in Grand Rivers, Livingston county, Ky. together with $200 damages for its wrongful detention, and $120 accrued rent. He alleged that it was the same property conveyed to him by appellant and wife, by general warranty deed dated and recorded August 4, 1921, and that he was the owner and entitled to the possession thereof, but that appellant was wrongfully withholding it from him.

Appellant filed an answer, set-off, and counterclaim, the first paragraph of which consisted of a general denial. In the second paragraph he affirmatively alleged that the deed was void and of no force or effect, and he prayed the court to so hold, and to order it canceled. As ground for this relief he alleged that at the time he executed the deed he was insane both as a matter of fact and as a matter of law, having been judicially declared so by a court of competent jurisdiction in this state, and never having been declared restored by any court prior to that time, and that appellant had full knowledge of these facts when dealing with him. In the third paragraph he alleged that, although the deed purported on its face to be unconditional conveyance of the fee, it was, in fact, a mortgage only, for the reason that simultaneously with its execution on August 4, 1921, appellee by a separate writing had agreed to reconvey the property to him, provided he repaid the $1,000 indebtedness on or before January 1 1922. He therefore prayed that, should the court hold the deed not void because of his insanity, as set out in the second paragraph of his answer, then it be adjudged that the deed, together with the simultaneous agreement to reconvey, constituted a mortgage upon which a right of action for ejectment, damages, and rent did not lie.

By agreement the affirmative allegations of the answer, set-off and counterclaim were controverted of record, and upon the issues thus raised the parties went to trial.

After the introduction of evidence had proceeded for more than a day, the court, apparently of its own motion, halted the trial, and entered the following order:

"It is ordered by the court that the deed from W. J. Fugate, and wife, Sue Fugate, to H. D. Walker, dated August 4, 1921, is a mortgage for the reason at the time of the execution of said deed plaintiff, H. D. Walker, signed and executed an instrument of writing, whereby he agreed to convey the property mentioned in said deed back to the defendant, W. J. Fugate, provided the sum of $1,000 was paid back to him by January 1, 1922, and that by reason of said mortgage the said plaintiff, H. D. Walker, in the opinion of this court has a lien upon the property conveyed to secure him in the payment of said $1,000 and interest thereon, from date of said deed, and it is further ordered by the court that the said Walker may be permitted to amend his petition in conformity with the ruling of the court, and set up his lien in this action.

The jury heretofore impaneled to try this cause is now discharged. To the ruling and opinion of the court the defendant, W. J. Fugate, by attorney, objects and excepts."

Within a day or two thereafter appellee filed an amended petition, and on his motion and over appellant's objection the action was transferred to the equity side of the docket. In the amended petition and in a second amended petition, appellant pleaded in detail all of the proceedings theretofore had in the action including the order of the court adjudging the deed a mortgage.

The facts as to the origin of the mortgage were set out at length. It was alleged that on January 27, 1920, E. S. Nickel and wife conveyed to appellant the property in question, and in consideration thereof appellant executed to Nickel his promissory note for $1,500, secured by a vendor's lien retained in the deed of conveyance, and that appellant took immediate possession of the property thus acquired, and has held and occupied it continuously since; that E. S. Nickel assigned the note to J. H. Nickel, and the latter, before its maturity and for the consideration of $1,500, sold and assigned it to the appellee. It was further alleged that on August 4, 1921, the note together with $80 accumulated interest was due and unpaid, and appellant, appellee, and J. H. Nickel, who was liable as assignor on the note, met for the purpose of effecting a settlement of the indebtedness. At the suggestion of, and through some arrangement with appellant, Nickel paid appellee the sum of $580, and this amount was credited to appellant, leaving a balance of $1,000 due and owing. In payment of this balance appellant conveyed the property to appellee, and appellee surrendered the note to appellant and executed the agreement to reconvey as set out in the order of the court. Appellee further alleged that by reason of the order of the court, which he termed a judgment, and by the terms of the deed and the agreement he had a mortgage on the premises described in the deed; that the debt secured therein was due and unpaid, and he therefore asked that the mortgage be enforced, and the property sold to satisfy his debt. Appellee also alleged that on the 4th day of October, 1921, appellant had been judicially declared of sound mind, and that thereafter he had filed his answer in which he prayed the court to adjudge the deed a mortgage, and the court had done so, and that the appellant was thereby estopped to complain of that action of the court, or to plead insanity as a defense against the enforcement of the mortgage.

Upon the filing of the foregoing amended petition, the court continued the action to the November term, and gave the defendant until the November rule day in which to plead. On November 6, 1922, which was rule day, appellant filed a demurrer to the amended petition, which the court overruled on the 1st day of December, that being the first day of that term of court. Thereafter the appellant filed numerous motions to strike, to elect, and to make more specific; all of which having been overruled, appellant filed an answer set-off, and counterclaim. The first paragraph of the answer was a denial of the allegations of the amended petition, including a denial of the proceeding theretofore had. In the second paragraph he again pleaded insanity in substantially the same terms as it was pleaded in the original answer. To this answer appellee filed a demurrer, and the court sustained same as to the first paragraph, but overruled it as to the second, pleading insanity. Appellee had...