Horvath v. Nat'l Mortg. Co., 110.

• Decision Date: 01 April 1927
• Docket Number: No. 110.,110.
• Citation: 213 N.W. 202,238 Mich. 354
• Parties: HORVATH v. NATIONAL MORTGAGE CO. et al.
• Court: Michigan Supreme Court

238 Mich. 354

213 N.W. 202

HORVATH

v.NATIONAL MORTGAGE CO. et al.

No. 110.

Supreme Court of Michigan.

April 1, 1927.

Appeal from Circuit Court, Wayne County, in Chancery; Theodore J. Richter, Judge.

Suit by Matilda Horvath against the National Mortgage Company and others. From the decree, plaintiff and defendant named appeals. Decree rendered.

Argued before the Entire Bench, except BIRD, J.O'Brien & Neudeck, of Detroit (MacKay, Wiley, Streeter & Tucker, of Detroit, of counsel), for plaintiff.

C. E. Gittins and Donald I. Albaugh, both of Detroit, for defendant National Mortgage Co.

Groesbeck, Sempliner, Kelly & Baillie, of Detroit (Edmund E. Shepherd and A. C. Stellwagen, both of Detroit, of counsel), for defendant Cash.

Blain & Martz, of Detroit, for defendant Vasvary.

McDONALD, J.

On the 1st of September, 1921, the plaintiff was the owner of two houses and lots in the city of Detroit, Mich. She and her husband were Hungarians by birth. They had but little knowledge of the English language and were entirely ignorant of business matters. The defendant Vasvary was also a Hungarian, but he was an educated business man, and represented himself to be of large means and influence. He and Horvath were members of the same lodge. He gained Horvath's confidence and persuaded him to have his wife, Matilda, place her property in his hands, representing that he could better care for it, increase the revenues, and by investments double the money received from the rents. The plaintiff was persuaded to do this, and for that purpose went to defendant Vasvary's office, where she signed a power of attorney in which Vasvary was oppointed to manage the property, and to sell it by deed or land contract for such price, upon such terms, and to such persons as he saw fit. On the 17th of September, Vasvary again called the plaintiff to his office, at which time the following papers were prepared and signed.

‘Detroit, Mich., Sept. 17, 1921.

‘Mr. Eugene W. Vasvary, Detroit, Michigan-Dear Sir: All the property and money which has come or may come in your possession from a settlement with Dr. John P. Tacey, according to the power of attorney of mine, you have the right to do with it as your best judgment dictates, and I, in this letter, consent to it also that this money or property shall be handled by you at least one year.

‘Invest it if you wish to do so, and I will look to you to give me a financial statement any time I desire it.

‘If this investment will take a longer period I shall be informed about it, and if I see fit, I will give my consent.

‘Yours truly,

[Signed] Matilda Horvath.

‘Geza Horvath.

‘Marguerite Smith.

‘I accepted.

E. W. Vasvary.'

‘Detroit, Mich., Sept. 17, 1921.

‘Mrs. Matilda Horvath, Detroit, Michigan-Dear Madam: For one dollar ($1.00) and other valuable consideration, I took your property over and will take over any money which may become due to you from a settlement between you and Dr. John P. Tacey, with the understanding that I will handle this property and money for you for a period of one year, and after this time only if you wish to extend it.

‘I will try to invest this money for you, and if the investment shall take a longer period than one year, I will submit the proposition to you for your consent.

‘I will furnish you a financial statement from time to time, or any time when you so desire, and I will make my heirs and executors responsible for the values which you invested with me.

‘Yours truly,

[Signed] E. W. Vasvary.'

On the same date Vasvary seems to have procured a warranty deed of the premises from the plaintiff. She denies that she signed the deed, and says that if her signature thereto is genuine, it was procured by trickery. On October 20, 1921, Vasvary executed three mortgages on the property to one Peter Patterson for $1,000, $2,000, and $3,000. The $3,000 mortgage was assigned to defendant Cash. On December 1, 1922, Vasvary executed a warranty deed to the defendant National Mortgage Company, and at the same time received back a land contract to himself as vendee. As a consideration for this transaction, the company paid $103.15 in taxes, assumed the two Patterson mortgage of $1,000 and $2,000, and gave Vasvary $2,368.85. The consideration named in the land contract was $13,000, on which Vasvary made a down payment of $1 and was to pay $120 a month, including interest at 7 per cent. After making one monthly payment, he defaulted. The National Mortgage Company began summary proceedings and secured possession of the property, which is valued at $15,000.

The plaintiff filed this bill to set aside the deed to Vasvary, the deed to the National Mortgage Company, its contract with Vasvary, and the mortgage held by James Cash. On the hearing the circuit judge found that the deed to Vasvary was void, it having been obtained from plaintiff by trickery; that the deed to the National Mortgage Company was merely a mortgage; and that the company was entitled to a lien on the property for the amount of its disbursements. The court also sustained the validity of the mortgage to James Cash. From the decree entered the plaintiff and the National Mortgage Company have appealed.

The first question to be considered relates to the deed from the plaintiff to Vasvary. Was it a forgery? In determining this question we have not the benefit of the testimony of Mr. Vasvary. He appeared at the hearing only by counsel, and though he did not appeal from the decree which branded him with forgery, his counsel have submitted a brief to this court in which they offer their personal assurance that--

‘He is a highly educated man, possessing many good qualities to an outstanding degree. Hastening over legal formalities has often caused him to be misunderstood. Those who understand him, his methods and his failings, do not regard him as crooked. His blunders are those of omission and not of commission. While he may have bungled in the management of this property, he has not the moral turpitude to forge or to conspire and trick plaintiff out of anything.’

With all deference to counsel in their voluntary efforts to set us right as to the high moral character of Mr. Vasvary, we are compelled to fall back upon the record for our information concerning him. He does appear to have had a habit, as counsel say, of ‘hastening over legal formalities.’ And inasmuch as it very conclusively appears by the evidence that he swindled this inexperienced and unlettered woman out of some $30,000, it would seem that his habit of ‘hastening over legal formalities' was a very profitable pastime with him. Notwithstanding the assurance of counsel, we find nothing in the record indicating that he was endowed with the slightest degree of moral sense; though, perhaps, he should be commended for declining to testify at the hearing, and thus crowning his forgery with the crime of perjury. Whether in this he was prompted by caution or conscience, his counsel have not advised us. However, the record strongly...