Hardeman v. Donaghey

• Court: Supreme Court of Alabama
• Citation: 170 Ala. 362,54 So. 172
• Parties: HARDEMAN v. DONAGHEY.
• Decision Date: 22 December 1910

54 So. 172

170 Ala. 362

HARDEMAN v. DONAGHEY.

Supreme Court of Alabama

December 22, 1910

Rehearing Denied Jan. 12, 1911.

Appeal from Chancery Court, Mobile County; Thomas H. Smith Chancellor.

Suit by Margaret Donaghey against J. S. Hardeman, revived in the name of B. F. Hardeman, administrator. Judgment for complainant and defendant appeals. Reversed and rendered.

Bill by Margaret Donaghey against J. S. Hardeman, revived in the name of B. S. Hardeman, administrator, to compel the surrender of a mortgage and its cancellation, to declare a judgment void and to require J. S. Hardeman to render a full, true, and correct account of the dealings had with oratrix, and to declare a trust for her benefit. The case made by the bill is that oratrix borrowed some money from Hardeman at a usurious rate of interest, and to secure it gave a mortgage, without knowing that she was giving such a mortgage, and that she had by partial payments paid the money borrowed, together with a considerable amount in excess by way of usurious interest. It is further alleged that the property was seized by Hardeman by action of detinue begun in a justice court, that judgment was rendered against complainant, and the property sold to satisfy said judgment. The prayer is as indicated above.

Inge &amp McCorvey and F. K. Hale, Jr., for appellant.

G. H. Kruempel and Edward Walsh, for appellee.

ANDERSON J.

If the complainant has a plain and adequate remedy at law, a court of equity cannot be resorted to as a substitute. The bill avers that the respondent converted complainant's property after the mortgage had been paid. If this was done, the taking was tortious, and she could bring detinue for the specific recovery of same or trover or trespass for the taking or conversion thereof. Of course, there are cases, where the complainant has only an equitable title and the respondent the legal title, in which courts of equity will take jurisdiction; but, if the mortgage was paid, the statute (section 4899 of the Code of 1907) revested the title in the mortgagor, and the plaintiff does not aver any facts which would indicate that she cannot establish the payment of the mortgage debt in a court of law, as there is not such a complication of accounts claimed as would need a court of equity to settle. On the other hand, if the respondent got the property under a writ of seizure, followed up by a judgment in detinue, she could have shown payment of the mortgage debt and have defeated a recovery, and, if improperly decided against her in the justice court, she had the right to appeal, and, in the absence of some equitable right, she cannot resort to the chancery court, merely to revise the rulings of a court of law. It was held as far back as Harrison v. Hicks, 1 Port. 423, 27 Am. Dec. 638, that, where the mortgage debt has been paid, the legal title is perfect in the mortgagor, and a resort to equity would not be tolerated even if the mortgagee was in possession. This Harrison Case was discussed in the case of Davis v. Hubbard, 38 Ala. 185, and was explained and modified, in so far as it was against the equity of the bill then being considered, and it was there held that a mortgagor could maintain the bill to establish the payment of the mortgage debt and enjoin an action by the mortgagee for the property. It must be noted, however, that the mortgagor was in possession, which is not so in the present case, and the bill there was really one for the cancellation of the mortgage by a mortgagor in possession, and which is essential to a bill for the cancellation of an instrument as a cloud on the title; the court intimating that the complainant would have no right to maintain the bill, even if in possession of the property, had she permitted the suit she sought to enjoin to have gone to judgment. In the case of Kelly v. Martin, 107 Ala. 480, 18 So. 132, the court held that, notwithstanding the statute divested the title upon payment of the mortgage debt, the mortgagor, in possession, might maintain a bill in equity to cancel the mortgage as a cloud on her title. The point that she was in possession was expressly made, however, in the opinion, which, among others, cites the case of Jones v. De Graffenreid, 60 Ala. 145, and which holds that the bill cannot be maintained by one not in possession. The case of Hudson v. Jackson, 144 Ala. 410, 39 So. 227, relied upon by the chancellor, involved a bill filed by a complainant in possession. Moreover, there was no contest between rival legal titles; but the complainant was relying upon an equitable title which she could not successfully assert in a court of law. The issue here is: Who has the legal title, the complainant or respondent? The bill avers that the mortgage was paid, and, if it was, complainant has the legal title, and the payment of the mortgage could be established in a court of law. It is true she might maintain a bill to remove the mortgage as a cloud, so long as she was in possession of the property (Rea v. Longstreet, 54 Ala. 291); but, not being in possession, she cannot resort to a court of equity to cancel the mortgage and recover the property or the value of same. If the property was tortiously taken, she has a plain remedy at law. If taken under legal process subsequently followed by a judgment, she could only regain same or the value thereof by getting rid of the judgment, which question we will discuss later.

Our court, in discussing the rights to equitable relief against judgments in courts of law, in the case of Noble v Moses, 74 Ala. 616, in speaking through Somerville, J., says: "There can be no controversy as to the general rule on the subject. It is settled to be that the fraud which is imputed to the plaintiff in the judgment, and for which alone a court of equity will intervene to vacate or enjoin, must be fraud in the rendition or procurement of the judgment itself. Cromelin v. McCauley, 67 Ala. 542. Or, as expressed by Mr. Story, 'the fraud must have been practiced in the very act of obtaining the judgment'--there must be 'fraud in its concoction.' 2 Story's Eq. Jur. § 1575. Fraud as to transactions antecedent to the judgment, such as would merely have constituted a good defense to the action, and not connected with the proceedings by which it was obtained, is deemed insufficient. Freeman on Judgments, §§ 489-490; Story's Eq. Jur. § 1574. The nature of the fraud, too, must be such as is utterly repugnant to honest intentions. It must, in a sense, be shown to be actual and positive. To this end there must exist the malus animus, 'putting itself in motion, and acting in order to take an undue advantage, for the purpose of actually and knowingly committing a fraud.' Kerr on Fraud & Mistake, 353. When this is clearly established by proper proof, as said in a former decision of this court, 'it is honorable to our system of equity jurisprudence that such infection of fraud is made to vitiate every transaction, and the solemn judgments of courts are no exception to the salutary rule.' Cromelin v. McCauley, 67 Ala. 547, supra. If there be no fraud in the act of obtaining or procuring the judgment, and equitable relief be sought against the judgment on a ground which went to the merits of the original suit at law, and which would have been available in that forum, the complainant is required, as a condition precedent to relief, to prove, as well as aver, three things: First, that he has a good and meritorious defense to the cause of action, or so much of it as h...