Ghiz v. Savas

• Decision Date: 07 August 1950
• Docket Number: No. 10208,10208
• Citation: 60 S.E.2d 290,134 W.Va. 550
• Parties: GHIZ et al. v. SAVAS et al.
• Court: West Virginia Supreme Court

Page 290

60 S.E.2d 290

134 W.Va. 550

GHIZ et al. v. SAVAS et al.

No. 10208.

Supreme Court of Appeals of West Virginia.

Submitted April 18, 1950.

Decided June 20, 1950.

Rehearing Denied Aug. 7, 1950.

Syllabus by the Court.

1. A conveyance absolute in form made at a time when a debt exists, or is created simultaneously therewith, may be proved to be a mortgage by parol.

2. Where, in a court of equity, conveyances absolute in terms are sought to be decreed mortgages, and the record discloses preexisting debts were due from the grantors to the grantees, or were created at the time the conveyances were made, and the evidence conflicts on the question whether the parties understood that the conveyances were to be considered as absolute, or mortgages securing the indebtedness, a trial chancellor's finding that the conveyances were intended to be absolute and not mortgages will not be disturbed on appeal.

3. On appeal the finding of a trial chancellor in solving a clear conflict of fact will not be disturbed.

4. Where, in a suit in equity brought by a grantor to set aside a conveyance made by him to a grantee on the ground that the conveyance was obtained by fraud, the fraud must be alleged and clearly and strictly proved as alleged.

5. In the absence of fraud or concealment from the principal of vitally important facts bearing on the transaction within the peculiar knowledge of an agent, employed to manage and lease property, having no power of sale, such agent may purchase the property from a sui juris principal. The mere relationship between an agent to manage and lease property with no power of sale and a sui juris owner thereof does not render a purchase by the agent from the principal fraudulent per se.

Pauley & Andrews, E. Franklin Pauley, Larry W. Andrews, Hodges, Revercomb & Price, W. Chapman Revercomb, Arthur B. Hodges, Leslie D. Price, all of Charleston, W. L. Fugate, Washington, D. C., for appellants.

Estep & Chambers, Logan, Casto & Wilson, Logan, for appellees.

RILEY, Judge.

Edward Harvey Ghiz, Gabriel Harvey Ghiz, and Michael Harvey Ghiz brought this suit in equity in the Circuit Court of Logan County against Nick Savas, O. M. Ayash, and Albert Klele, as individuals, and as partners trading and doing business as Mallory Mercantile Company and as Union Trading Company, and S. A. Ammar, K. A. Ammar, and N. A. Ammar, praying (1) that seven certain deeds, filed as exhibits with plaintiffs' bill of complaint, though absolute conveyances on their faces, be declared mortgages; (2) that the deeds be cancelled, or that the defendants be compelled to reconvey the property embraced therein; (3) that four other deeds and that part of a deed filed as Exhibit 18 with plaintiffs' bill of complaint, as may concern plaintiffs' title, be cancelled as a cloud upon plaintiffs' title; (4) that a decree be entered, compelling the defendants to account for income and proceeds from the property conveyed by said deeds, and pay to the plaintiffs the income derived therefrom from the dates of the deeds to the present time; and (5) that defendants be restrained from disposing of the property, and further that the court appoint a receiver to take charge of the income of the property and hold the same pending the outcome of this suit. From a final decree adjudicating (1) the deeds under attack to be in all respects legal and valid absolute conveyances of the property described therein; (2) denying the relief prayed for in plaintiffs' bill of complaint; and (3) dismissing plaintiffs' bill of complaint, the plaintiffs prosecute this appeal.

The plaintiffs are three of the sons of Harvey (Habib) Ghiz, designated in the record, and in this opinion, as 'Habib Ghiz'. The latter died intestate in Logan County in 1924, leaving surviving his widow, Ady Ghiz, and eight sons, the three plaintiffs herein, and Luther, Alexander, Michael, Harvey, Jr., and Theodore Ghiz, all of whom at the time of decedent's death were infants. The decedent's widow died in 1932, leaving surviving said eight sons, four of whom were then under twenty-one years of age. Harvey Ghiz, Jr., died intestate unmarried, and without issue in 1935, survived by his seven brothers as his heirs at law and next of kin.

Habib Ghiz's estate was initially appraised at $176,545.66, consisting of real estate in the amount of $135,650.00, and personal property, including $27,000.00 of life insurance payable to his estate appraised at $40,895.66. From the appraisement it appears that the real estate was encumbered by a deed of trust, bearing date, October 8, 1923, in which Habib Ghiz and wife were grantors, to secure notes in the amount of $40,000.00. The real estate consisted of the Aracoma Hotel property in Logan valued in the appraisement at $100,000.00; decedent's home property in Logan, together with house situated on the side thereof, valued at $10,000.00; a right of way across the adjoining property used in connection with the last-mentioned houses, valued at $50.00; decedent's store property in Logan valued at $20,000.00; lot with house thereon adjoining the last-mentioned residence property valued at $2,500.00; lot on hill in Logan valued at $500.00; five lots in Section 5, Oak Hill Addition to the City of Logan, $2,500.00; and two lots in the village of Gilbert, Mingo County, valued at $100.00. This appraisal included a stock of goods, comprised of men's furnishings, etc., valued at $10,929.42, carried in a general store owned and operated by Habib Ghiz at the time of his death. Other personal property in addition to life insurance in the amount of $27,000.00, mentioned above, consisted of an automobile, a cow, household furniture in the amount of $1,030.00; collectible debts at the store, $897.27; and cash in the amount of $1,038.97.

In 1929, Ady Ghiz Corey, widow of Habib Ghiz, deceased, Luther Ghiz, Gabriel Ghiz, Michael Ghiz, and five minor sons, by L. G. Burns, their guardian, executed a deed of trust to Harris and Jenkins, trustees, to secure a $24,000.00 loan from the Life Insurance Company of Virginia, evidenced by fifteen principal notes, payable to bearer, at the State Planters Bank & Trust Company, said loan hereafter being referred to as 'Planter's Bank Loan'. Five of said notes, totaling $12,000.00, were signed by Ady Ghiz Corey; five totaling $7,000.00 by Luther Ghiz, and five totaling $5,000.00 by Michael Ghiz. The first in each of the three series of five fell due October 15, 1930, and the fifth. October 15, 1934. The real estate involved was business property in the City of Logan. And in 1934 another deed of trust, covering personal property in the Aracoma Hotel, was executed as additional security. Both deeds of trust were released May 2, 1939, the indebtedness having been paid off.

During the years from 1934 to 1937 plaintiffs each executed one or more deeds, the legal effect of which is involved in this litigation. These deeds purport to convey certain interests of each of the above-named plaintiffs in the estate of their deceased father, Habib Ghiz, as well as several one-sevenths interests in the estate of their deceased brother, Harvey Ghiz, Jr.

The purported conveyances, which plaintiffs seek to have declared mortgages, or cancelled on the ground of fraud are: (1) Deed dated March 28, 1935, from Edward Ghiz to O. M. Ayash, Nick Savas, and Albert Klele, partners as Mallory Mercantile Company, purporting to convey a full one-eighth undivided interest, subject to the life estate of grantor's mother, Ady Ghiz (Corey), in the real estate of which Habib Ghiz died seized; (2) a deed dated January 4, 1934, from Gabriel Ghiz to Union Trading Company, a partnership (consisting of Savas, Ayash and Klele), purporting to convey a full one-eighth undivided interest, subject to the life estate of Ady Ghiz (Corey) in the real estate of which Habib Ghiz died seized; (3) a quitclaim deed from Gabriel Ghiz to Albert Klele, dated August 26, 1937, purporting to convey all right, title and interest, being a one-eighth undivided interest in certain named real estate, including the Aracoma Hotel, which was inherited by the grantor from his deceased father, Habib Ghiz; (4) a deed from M. H. (Michael) Ghiz to Albert Klele, dated September 16, 1935, purporting to convey a full one-eighth undivided interest in and to all the real estate of which his father, Habib Ghiz, and his mother, Ady Ghiz, had died seized and possed, the latter property being the home property of Ady Ghiz, situate in Huntington, Cabell County; (5) a deed from Edward Ghiz, dated October 15, 1936, to Savas, Ayash and Klele, purporting to convey the grantor's one-seventh interest of one-eighth of the estate, real and personal, of Habib Ghiz, of which his brother Harvey Ghiz, Jr., died seized; (6) a certain deed dated June 18, 1936, from Gabriel Ghiz to Savas, Ayash and Klele, partners as Mallory Mercantile Company, purporting to convey all of grantor's interest in the estate of his deceased brother, Harvey Ghiz, Jr., being a one-seventh of a one-eighth undivided interest in the estate, both real and personal of which Habib Ghiz died seized and possessed; and (7) a deed from Mike (Michael) Ghiz, dated September 9, 1936, to Savas, Ayash and Klele, partners as Mallory Mercantile Company, purporting to convey one-seventh of a one-eighth interest in the estate of Habib Ghiz, of which grantor's deceased brother, Harvey Ghiz, Jr., died seized and possessed.

The conveyances which the plaintiffs seek to have cancelled as a cloud upon their title are: (1) A deed, dated August 14, 1934, from Savas and wife, Ayash and Klele and wife, the three men being partners and doing business under firm name Union Trading Company, to Georgia Lee D'Armon, purporting to convey a full one-eighth undivided interest (Gabriel's) in and to all the real estate of which Habib Ghiz died seized and possessed, as well as an undivided one-eighth interest in the home property of the decedent, Ady Ghiz, situate in...