Goetz v. Flanders

• Decision Date: 27 November 1893
• Citation: 22 S.W. 945,118 Mo. 342
• Parties: Goetz et al. v. Flanders et al., Appellants
• Court: Missouri Supreme Court

22 S.W. 945

118 Mo. 342

Goetz et al. v. Flanders et al., Appellants

Supreme Court of Missouri, First Division

November 27, 1893

Appeal from Jackson Circuit Court. -- Hon. R. H. Field, Judge.

Affirmed.

K. McC. DeWeese and S. Foster for appellants.

(1) Fraud must be affirmatively proved as alleged. 1 Beach on Modern Equity Jurisprudence, p. 72, sec. 71; Ryan v Hitchcock, 43 Mo. 527; Marksbury v. Taylor, 10 Bush, 519. It cannot be left wholly to inference or even principally to conjecture. (2) The wrongful acts charged against Flanders, if true, positively amount to a crime. Therefore, the presumption of innocence prevailed with as much force as if this were a trial upon an indictment. Gutzweiler v. Lackmann, 39 Mo. 91; Herring v Richards, 1 McCreary, 574; Fleming v. Slocusm, 18 Johns. (N. Y.) 403; Jackson v. King, 4 Cowen (N Y.) 220; Starr v. Peck, 1 Hill (N. Y.) 270; Wait on Fraudulent Conveyances, sec. 5. (3) No evidence of Sleek's deceit was competent as against Flanders until the unlawful confederation between them had been proven. Bigelow on Fraud, pp. 483, 484, and cases cited. (4) There is no evidence to justify a suspicion or even probability of any complicity on the part of Flanders in any of the alleged wrongful acts of Sleek, or any knowledge of them. (5) There is no adequate foundation for the judgment in this case. Bryan v. Hitchcock, 43 Mo. 527; Jackson v. Wood, 88 Mo. 76. (6) The evidence must, in fact, be so clear, definite and positive as to leave no room, or reasonable ground, for doubt in the mind of the court. Forrester v. Scovill, 51 Mo. 268; Johnson v. Quarles, 46 Mo. 423, and cases cited. (7) Fraud in the inception of a contract does not render it void, but only voidable, at the option of the defrauded person. Cobb v. Hatfield, 47 N.Y. 533; Beach on Modern Equity Jurisprudence, p. 85, sec. 82, and cases cited.

L. G. Rowell and E. J. McWain for respondents.

(1) The existing and well recognized rule of this court, in reviewing chancery cases, is to defer to the findings and judgments of the trial court, who has had the opportunity of confronting the parties and witnesses and observing their demeanor; and unless appellant can show from the record a want of any testimony to sustain the finding, or the existence of a fair preponderance against it, in cases of conflict of evidence, the finding and judgment of the lower court will not be disturbed. Mellier v. Bartlett, 106 Mo. 381; Drosten v. Mueller, 103 Mo. 624; Rawlins v. Rawlins, 102 Mo. 563; Bohannon v. Combs, 97 Mo. 446. (2) The acknowledged rule of this court requires less directness of proof in the establishment of a charge of fraud in equity than at law. In the former, it may be inferred from the facts and circumstances of the transaction. King v. Moon, 42 Mo. 555; Massey v. Young, 73 Mo. 273; Story's Equity, sec. 190; Cooley on Torts, 475; 3 Greenleaf's Evidence, sec. 254. (3) The proof of fraud need not be direct and positive, but may be inferred from the surrounding circumstances. Massey v. Young, 73 Mo. 273; Frederick v. Allgaier, 88 Mo. 598; Burgert v. Borchert, 59 Mo. 83; Hopkins v. Seivert, 58 Mo. 201; King v. Moon, 42 Mo. 555; Cooley on Torts, 475; Story's Equity, sec. 190; Kerr on Fraud and Mistake, 384; Rinckle v. Nichols, 7 Mo.App. 591; State ex rel. v. Estel, 6 Mo.App. 6; Groschke v. Bardenheimer, 15 Mo.App. 353; Chandler v. Fleeman, 50 Mo. 240. (4) A warranty deed induced to be signed by fraud and deception, under the misapprehensive belief, of executing a deed of trust, is utterly void and totally destitute of validity, and can be avoided without any formal act of rescission and restitution. Turner v. Turner, 44 Mo. 539; Stumpf v. Stumpf, 7 Mo.App. 276; Loeffel v. Pohlman, 47 Mo.App. 586.

OPINION

Black, P. J.

The plaintiffs, husband and wife, brought this suit against F. L. Flanders and Henry Sleek to set aside a deed from the plaintiffs to Flanders. The deed bears date the twenty-third of April, 1890, and conveys a lot with two houses thereon in the City of Kansas. The relief is asked on the ground that the plaintiffs supposed they executed a deed of trust in the nature of a mortgage, but by the fraud of the defendants were induced to execute a deed absolute in form. The suit was dismissed as to Sleek; decree for plaintiffs.

The plaintiffs are German people, unable to read or write in the English language. They had owned and resided on the lot for more than twenty years, renting out one of the houses. It appears the property was incumbered by two mortgages, one to Reed for $ 2,000 and the other to Rowell for $ 200. These mortgages and the interest thereon and the unpaid taxes, amounted to about $ 2,600. In February, 1890, Sleek went to the plaintiffs and represented that he had eastern money to loan, and proposed to procure a loan for them sufficient to pay off the incumbrances. They agreed to take a loan of $ 2,700 for five years. Sleek testified that he was unable to procure a loan on the property, and that Goetz finally told him to sell it and that he did sell it to Flanders for $ 2,700.

The plaintiff testified in the most positive terms that they never gave Sleek any authority to sell the property and supposed all the time they were obtaining a loan and had executed a deed of trust to secure the same. Mr. Goetz went to Sleek's office on the evening of the twenty-third of April, 1890. He says Sleek then produced a paper saying it was a deed of trust, that he signed it at the place pointed out by Sleek. It appears Goetz had, on a former occasion, executed a mortgage on the lot to secure $ 75 due to Mr. Johnson, and Sleek spoke of this mortgage. Goetz said he had paid it off. The two then went to the office of Johnson who agreed to satisfy the mortgage on the next day. Mr. Johnson testified that Sleek then said he was making a loan to Goetz. This was after Goetz had signed the instrument but on the same day. Goetz left the city on the next day, leaving it to his wife to close up the transaction. In one or two days thereafter she signed the deed, and Sleek at a later date delivered it to the defendant Flanders. Sleek did not read the deed to either of the grantors but said to both of them it was a deed of trust. They had been to see him repeatedly about the loan. As soon as Flanders got the deed he demanded rents of the tenants in one of the houses, and in this way Mrs. Goetz received information that Flanders claimed to have purchased the property.

She and her son by a former marriage went to Sleek's office. As to that conversation the son testified: "I asked Mr. Sleek about the matter, if he was not to loan money to my mother and step-father to pay off what they had on the property. Sleek said, 'Yes.' I asked him why he did not pay it off and not let them bother my mother. He said they had all been paid. I said, 'You have not paid Mr. Reed.' He said, 'Yes, he was paid last night.' I said, 'This don't look like it,' and pulled out the letter from Mr. Reed and showed it to him. He replied that, 'If Mr. Reed was not paid last night, he was this morning.' My mother insisted on seeing the paper she had signed. She asked him what Dr. Flanders had to do with it. He said Dr. Flanders furnished the money. She told him she wanted nothing to do with Dr. Flanders. Sleek said Flanders was only joking."

Mr. McWain saw Sleek, at the request of Mrs. Goetz, in the forenoon of the third of May, 1890. He inquired about the incumbrances on the property and Sleek said Flanders was the man to pay them. Being asked what kind of a deed Flanders had, he said it was a conditional deed, in effect a mortgage. It appears Flanders paid Sleek $ 85, which Sleek says represented money he had advanced Mr. and Mrs. Goetz and $ 10 for an abstract. They say he advanced them $ 25 only.

Flanders testified that Sleek offered him the property at $ 3,000 that he refused to pay that price, but agreed to pay $...