Gardner v. Switzer

• Decision Date: 05 March 1945
• Docket Number: 39145
• Citation: 186 S.W.2d 561,353 Mo. 1124
• Parties: R. H. Gardner and Ruby Simpson v. J. L. Switzer and Lillie B. Switzer, Appellants. (Defendant Carolyn W. Gardner not appealing.)
• Court: Missouri Supreme Court

186 S.W.2d 561

353 Mo. 1124

R. H. Gardner and Ruby Simpson v. J. L. Switzer and Lillie B. Switzer, Appellants. (Defendant Carolyn W. Gardner not appealing.)

No. 39145

Supreme Court of Missouri

March 5, 1945

Rehearing Denied April 2, 1945.

Appeal from Linn Circuit Court; Hon. Charles A. Johnson Special Judge.

Reversed and remanded.

C B. Burns and Charles V. Garnett for appellants.

(1) The decree wholly fails to do equity between the parties, because, if it be conceded, arguendo, that the foreclosure is void, the effect of the decree is to restore plaintiffs' title free from the lien of the mortgage debt without requiring plaintiffs to repay the amount paid by defendant Switzer in purchase of the mortgage note. Stephenson v. Stephenson, 171 S.W.2d 565; Jones v. McGonigle, 37 S.W.2d 892; Queen City Inv. Co. v. Kreider, 31 S.W.2d 1002. (2) Defendant J. L. Switzer had the right to alter the endorsement on the mortgage note to reflect the real transaction between the parties; consequently, such alterations were wholly immaterial, not affecting the validity of the note or destroying defendant Switzer's right to foreclosure. Bruegge v. State Bank of Wellston, 74 S.W.2d 835; L.E. Lines Music Co. v. Brittel, 30 S.W.2d 781; Campbell v. Allen, 38 Mo.App. 27; Blesse v. Blackburn, 31 Mo.App. 264; Diecke v. Roudebush, 138 S.W.2d 678. (3) Plaintiffs are not entitled to equitable relief because the land in question is of far less value than the mortgage debt and plaintiffs would gain nothing by having the foreclosure set aside and the property subjected to another foreclosure. Anderson v. Taylor, 227 S.W. 84.

H. K. West for respondents.

(1) The note was paid, the foreclosure void. Pease v. Iron Co., 49 Mo. 124; Baker v. Reed, 162 Mo. 341; Bacon v. Reichardt, 208 S.W. 24; Dowling v. Bank, 267 S.W. 1; Bank v. Simers, 242 S.W. 417; Hensley v. Holzer, 19 Mo.App. 245; McNarr v. Penatte, 33 Mo. 57; Jackson v. Johnson, 248 Mo. 680; Chappell v. Allen, 35 Mo. 213; Rowe v. Bank, 2 S.W.2d 191. (2) There could be no subrogation under the pleadings and evidence. Kellman v. Gieselmann, 45 Mo.App. 497; Bunn v. Lindsay, 95 Mo. 250; Grady v. O'Reilly, 115 Mo. 346; Lemmon v. Lincoln, 65 Mo.App. 76; 60 C.J. 807; Copen v. Garrison, 193 Mo. 335; Implement Co. v. Jones, 143 Mo. 253; Neer v. Neer, 80 S.W.2d 240; 25 R.C.L. 1337; Wolff v. Walter, 56 Mo. 292; Clark v. Bank, 57 Mo.App. 277; Evans v. Hollick, 83 Mo. 376; Pomeroy, Equity, sec. 1212; Schawer v. Kelleyer, 20 S.W.2d 26. (3) Because of the alteration, the note was destroyed and defendants have no claim on the land. Evans v. Foreman, 60 Mo. 449; Bank v. Fricke, 75 Mo. 119; Bank v. Armstrong, 62 Mo. 59; 8 C.J. 728; Harvesting Co. v. Blain, 146 Mo.App. 374; Whitner v. Frye, 10 Mo.App. 348; Investment Co. v. Scales Co., 209 S.W. 89; Bank v. Packing Co., 70 Mo. 643; Dunbar v. Bank, 295 S.W. 835; Bank v. Bank, 107 Mo. l.c. 410; Jacobs v. Gibson, 77 Mo.App. 244.

OPINION

Gantt, J.

Action to set aside a sheriff's deed as substitute trustee in a deed of trust. The deed conveyed certain land in Linn County, Mo., to the defendants Switzer as purchasers at a sale under the deed of trust. The foreclosure was for default in payment of the note secured by the deed of trust. The Switzers claim title under the sheriff's deed.

Plaintiffs contend the sale was without authority of law and claim title to the land as heirs of L. H. Gardner, deceased. Defendant Carolyn Gardner, widow of L. H. Gardner, deceased, and mother of the plaintiffs, also contends the sale was without authority of law and claims dower. The judgment set aside the deed and ordered partition. Defendants Switzer appealed.

In substance it is alleged in the first count of the petition that L. H. Gardner and Carolyn W. Gardner, his wife, executed to E. L. Anderson, Trustee, a deed of trust on the land to secure the payment of a note payable to the order of R. L. Anderson; that after the death of L. H. Gardner the note secured by the deed of trust was paid to the owner thereof; that the note was marked paid by the owner, who endorsed thereon words as follows: "Assigned to Recorder for release of record, E. L. Anderson"; that defendant J. L. Switzer erased the words "paid" written on the note and also erased the assignment of the note to the recorder; that the erasures were material alterations of the note; that Switzer made said erasures with the consent of his wife Lillie B. Switzer, and that after making said erasures J. L. Switzer, with the consent of his wife, wrote on the note an assignment to himself by forging the name of E. L. Anderson.

It also alleged that the sheriff of Linn County, as substitute trustee in the deed of trust and on the request of defendants Switzer, sold and conveyed the land to the Switzers for a named consideration of $ 500.00, whereas no money, except for costs of sale, was paid to the sheriff for the land, and that the sale was for default in payment of the note.

It also is alleged that the deed is void because the Switzers were not owners of the note and because the alterations of the note made by the Switzers are material alterations.

Count two of the petition is conventional and prays for partition of the land.

The answer of the defendants Switzer to the first count is a general denial, with an allegation that the note was not paid but sold to said defendants.

The answer of said defendants to the second count of the petition is a general denial with a plea of estoppel.

Defendant Carolyn W. Gardner filed a separate answer, confessing that the relief prayed for in the petition should be granted.

J. L. Switzer, witness for the plaintiffs, testified in substance as follows:

Lillie B. Switzer is my wife. I knew E. H. Gardner in his lifetime. I don't remember the date of his death. He died before June 8, 1937, and left surviving his widow and two children. I have known the family all of my life. I do not know whether the children were of age when I dealt with them. Witness was handed plaintiff's exhibit "A" (the note in question) and asked if he had ever seen that document. He answered that he saw the document when he and Mrs. Gardner came from Mr. Anderson's after paying the note. I saw it when Mrs. Gardner came to my house after paying the note. I endorsed the note. When I first saw the note the words "paid" were on it. I erased said words and also erased the assignment of the note to the recorder for release. Mr. Anderson was not present when I made the erasures. I have not seen nor talked to him since I made the erasures. I was not present when Mr. Anderson endorsed the note "for release of record", nor was I present when he marked the note "paid". I saw the sheriff after I made the erasures. He published the notice of foreclosure at my request and sold the land under the deed of trust. I purchased the eighty acres of land and went into possession. It was not improved land at the time of the foreclosure. I made fences, cleaned out the ditches and cleaned out fence rows. I had one crop of corn on about fifteen acres of the land since I purchased it. I lived by the Gardners for a number of years. At the time of the transaction with reference to the sale of the land, the daughter Lillie was twenty-one years of age. I did not know that Mr. Gardner, who is dead, was the owner of the farm. I knew that his wife signed the note and deed of trust on the land. At the time I made the erasures, Gardner was dead and had been for a couple of years. It was Gardner's note and Gardner's farm and Gardner's wife who signed in that capacity.

On plaintiffs' offer, the note for $ 2000, exhibit "A", was admitted in evidence. It is dated February 2, 1923, payable to the order of R. L. Anderson. The note was reduced to $ 755.00. On the back of the note is an endorsement as follows: "I assign the within note to J. L. Switzer. (Signed) E. L. Anderson."

On plaintiffs' offer, exhibit "B", the deed of trust was admitted in evidence. It also is dated February 2, 1923.

On plaintiffs' offer, exhibit "C", the sheriff's deed conveying the land to the Switzers, was admitted in evidence. It is dated April 30, 1938.

On being called as a witness for the defendants, J. L. Switzer testified as follows:

On June 7, 1939, Mrs. Gardner came to my home. Plaintiff R. H. Gardner was not with her. Ruby Simpson, her daughter, was with her. Mrs. Gardner brought the note and old deed of trust to me. At that time it was marked paid and for release of record. I made the erasures the next morning or the next day. I did so in the presence of my family and no one else. After the foreclosure I gave the note to Mrs. Gardner.

Ruby Simpson, witness for the plaintiff, testified in substance as follows:

I am a plaintiff in the case and the daughter of E H. and Carolyn Gardner. We lost the farm in July, 1935. At that time I was twenty-one years of age and my brother, R. H. Gardner, a plaintiff, was eighteen years of age. I do not know if my mother, Carolyn Gardner, will be present at the trial. I do not know if she was asked to join as plaintiff in the case. We found the note in my mother's papers, and my brother, R. H. Gardner, took possession of the note. My husband was not with me when we found the note. It was about the time the final settlement was made. My mother and brother went to Linneus with the papers. I did not go with them. My brother, R. H. Gardner, the other plaintiff, and my mother, Carolyn Gardner, are not here for the trial. I do not know where my brother and mother kept the papers. I never had the note. I saw the note in my mother's papers. We turned the note over to attorney West. My husband talked to him before we got the note. I did not talk to my mother about filing suit. Later I told her we were going to file suit. She...