Gross v. Brooks

• Decision Date: 22 May 1961
• Docket Number: No. 217,217
• Citation: 130 So.2d 674
• Parties: Gloria GROSS and Paul N. Gross, Plaintiffs and Appellees and Defendants-in- Reconvention-Appellees, v. William BROOKS, Defendant and Appellant and Plaintiff-in-Reconvention- Appellant.
• Court: Court of Appeal of Louisiana — District of US

Page 674

130 So.2d 674

Gloria GROSS and Paul N. Gross, Plaintiffs and Appellees and Defendants-in- Reconvention-Appellees, v. William BROOKS, Defendant and Appellant and Plaintiff-in-Reconvention- Appellant.

No. 217.

Court of Appeal of Louisiana, Third Circuit.

May 22, 1961.

Rehearing Denied June 13, 1961.

Thomas A. Self and John P. Godfrey, by Thomas A. Self, Many, for defendant-appellant.

Gahagan & Gahagan, by Russell E. Gahagan, Natchitoches, for plaintiffs-appellees.

Before SAVOY, HOOD and CULPEPPER, JJ.

HOOD, Judge.

This is an eviction proceeding instituted under the provisions of LSA-R.S. 13:4911 et seq., by Mrs. Gloria Gross and her husband, Paul N. Gross, against William Brooks, affecting a 60-acre tract of land in Natchitoches Parish. Defendant filed exceptions of no cause or right of action, an answer and a reconventional demand. The exception of no right or cause of action were overruled, and after trial of the case on its merits judgment was rendered in favor of plaintiffs, rejecting the reconventional demands of defendant and ordering defendant to vacate the premises. Defendant has appealed from that judgment.

The record shows that defendant Brooks acquired title to the 60-acre tract of land involved in this suit in 1951. He subsequently mortgaged that property to J. M. Henry, Jr., to secure an indebtedness of $1,000, and he executed a second mortgage on the same property in favor of J. Makar to secure an indebtedness of $900.

In the fall of 1959, defendant was notified that the mortgage held by J. M. Henry, Jr., would be foreclosed shortly thereafter unless the indebtedness secured by that mortgage was paid in full. Defendant was unsuccessful in refinancing this indebtedness locally, so he contacted Tom T. Foster, of Shreveport, and requested financial assistance from him. Mr. Foster is the father of Mrs. Gloria Gross, one of the plaintiffs in this suit, and since Mrs. Gross resides in Wyoming Mr. Foster was acting as her agent in acquiring property and in negotiating other financial transactions for her within the State of Louisiana. Mr. Foster, acting on behalf of Mrs. Gross, at first agreed to loan defendant an amount sufficient to pay the Henry indebtedness, with the understanding that the loan would be secured by a first mortgage on defendant's property. Foster employed an attorney to examine the title, however, and he testified that upon being advised by this attorney of the existence of a second mortgage in favor of Makar, he informed Brooks that he was not willing to loan him enough money to clear the property of both of these mortgages, and he suggested that Brooks get someone else to finance it for him. There were further negotiations between Brooks and Foster after that time, however, and according to Foster's testimony these negotiations resulted in an agreement by which the property was to be sold to Mrs. Gross.

On October 26, 1959, defendant and his wife accompanied Foster to the office of Jack O. Brittain, an attorney and notary in Natchitoches, and in the presence of this notary and two attesting witnesses, William and Clarice Brooks executed an authentic act of sale conveying the 60-acre tract of land to Mrs. Gloria Gross for a recited consideration of $2,114.30. Out of this purchase price both of the mortgages were satisfied and cancelled and the expenses of completing the sale were paid. Defendant Brooks contends that he did not receive the full amount of the purchase price, but the evidence fails to establish that fact.

A few days after this sale was completed Foster loaned Brooks over $300, which amount was used by the latter to pay other debts, and as security for the repayment of this loan Brooks gave Foster a chattel mortgage covering and affecting some cattle. The amount of this loan was subsequently repaid by Brooks and no issue is raised in this suit as to that chattel mortgage or as to the indebtedness which it secured.

Defendant Brooks has continued to occupy and reside on the property since the date of this sale. In March or April, 1960, however, Foster advised him that he would have to start paying rent or that he would have to vacate the premises. No rental payments were made, and consequently this eviction proceeding was instituted on August 22, 1960. Between the date of the sale and the time Brooks was notified to pay rent, however, Foster incurred expenses amounting to more than $200 in planting pine trees on the property and otherwise improving it.

Defendant alleges and contends (1) that the purported deed dated October 26, 1959, was in fact a security contract; (2) alternatively, that the purported conveyance was a sale with a right of redemption; (3) that the purported conveyance was procured through fraud and misrepresentation, and accordingly that it is invalid; (4) alternatively, that defendant and his wife executed the purported deed in error as to the motive, nature and character of the transaction and in error as to the law; and (5) that the sale was void for lesion beyond moiety.

The jurisprudence of this state is well settled to the effect that, as between the parties and in the absence of evidence to the contrary, a sale of immovable property will be regarded as a contract of security, if the vendor specifically reserves the right of redemption and thereafter remains in possession of the property sold during the entire period allowed for redemption. Marbury v. Colbert, 105 La. 467, 29 So. 871; Latiolais v. Breaux, 154 La. 1006, 98 So. 620; Jackson v. Golson, La.App. 2 Cir., 91 So.2d 394 and La.App., 111 So.2d 876. In the instant case, however, the vendor in the deed did not reserve the right of redemption, so there is no legal presumption that the purported sale was in fact a contract of security. See Glover v. Abney, 160 La. 175, 106 So. 735.

Defendant, of course, would be entitled to have the act of sale anulled or to have it reformed to show that it was actually a pignorative contract, or a sale with the right of redemption reserved to the vendor, upon establishing that he was induced to sign the contract through fraud or misrepresentation.

At the time of the trial, defendant Brooks was a 56-year old colored man who had a fourth grade education and who could scarcely read or write. His wife, Clarice Brooks, had only a second grade education, and she could neither read nor write. Both William and Clarice Brooks testified that they thought the document which they signed in the notary's office was a mortgage, and that they would never have signed it if they had been aware of the fact that it was a deed.

The notary before whom the act of sale was executed testified that Brooks talked to Foster about repurchasing the property from Mrs. Gross at some undetermined future time and for an unspecified sum of money. This conversation took place out of the presence of the notary, but reference to it was made in his presence. The notary further testified that he asked Foster, in the presence of Brooks, whether the deed should specify that Brooks would have the right to re-purchase the property, and although he does not remember what was said in response to that question, he assumes that Foster told him that such a clause should Not be included, since no such provision was incorporated into the deed. The notary recognized the semi-literacy of William Brooks, but he stated that, although Brooks might have assumed that a right of redemption existed even though not specified in the deed, there was no question but that William Brooks fully understood that he was transferring ownership of the 60-acre tract of land to Mrs. Gross. He testified that, as a notary public, he made it a regular practice to explain carefully to the parties involved the nature of the transaction, and that he was particularly careful in this regard when one or more of the parties was illiterate or semi-literate.

The evidence further shows that on November 3, 1959, just a few days after the sale had been completed, the attorney and notary who handled this transaction mailed to Brooks copies of two letters stating specifically that Brooks had sold the property to Mrs. Gross, that Brooks had not retained any minerals affecting the property and that Mrs. Gross was the full owner of a good and merchantable title to the property. Although Brooks says he informed the notary shortly after receiving these letters that he had not sold the property, the testimony of the notary to the contrary convinces us that Brooks did not contact the notary after these letters were received by him and that he did not protest the statements made in those letters.

Article 1847 of the LSA-Civil Code provides, in part:

'Art. 1847. Fraud, as applied to contracts, is the cause of an error bearing on a material part of the contract, created or continued by artifice, with design to obtain some unjust advantages to the one party, or to cause an inconvenience or loss to the other. * * *'

In Sanders v. Sanders, 222 La. 233, 62 So.2d 284, 286, the Supreme Court stated:

'In the jurisprudence of this court it has been said that the charge of fraud is a most serious one; that one who alleges fraud has the burden of establishing it by legal and convincing evidence since fraud is never presumed, and that to establish the fraud exceptionally strong proof must be adduced. Strauss v. Insurance Co. of North America, 157 La. 661, 662, 102 So. 861; Garnier v. Aetna Insurance Co. of Hartford, Conn., 181 La. 426, 159 So. 705; Mutual Life Ins. Co. of New York v. Rachal, 184 La. 430, 166 So. 129; Metcalf v. Monsour, 195 La. 570, 197 So. 235; Mente & Co., Inc. v. Roane Sugars Inc., 199 La. 686, 6 So.2d 731; American Guaranty Co. v. Sunset Realty & Planting Co., Inc., 208 La. 772, 23 So.2d 409. It has also been said that evidence showing that the fraud was probable or that the circumstances partook of a suspicious character is not sufficient, and that the fraud must be established by proof stronger than the mere...