Hunt v. McCord

• Decision Date: 29 January 1918
• Citation: 200 S.W. 2,179 Ky. 1
• Parties: HUNT v. MCCORD.
• Court: Kentucky Court of Appeals

200 S.W. 2

179 Ky. 1

HUNT v. MCCORD.

Court of Appeals of Kentucky.

January 29, 1918

Appeal from Circuit Court, Meade County.

Action by Charles McCord against G. R. Hunt. From an adverse judgment, defendant appeals. Reversed in part, and affirmed in part, with directions.

David R. Castleman and Pryor & Castleman, all of Louisville, for appellant.

J. M Richardson, of Brandenburg, for appellee.

THOMAS J.

On May 1, 1912, appellant, Hunt (defendant below), and one Bridgeford were the joint owners in fee of several tracts of land in Meade county, Ky. One of the tracts containing 500 acres was known as the "Grahamton mills tract," which included a mill site at which a cotton mill factory was located. On the day and date above Bridgeford and the defendant leased the Grahamton mill tract, including the mill thereon in its then condition, to appellee (plaintiff below) "for three (3) years, with the privilege of two (2) years longer," the rental being $100 per month, one-half of which to be paid to each of the lessors. In the lease there was this agreement on the part of the lessors:

"Second. At the expiration of this lease G. R. Hunt and J. R Bridgeford agree to pay to McCord Company one-half of the cost of engine boiler and boiler house which cost five thousand one hundred and fifty-one dollars and thirty cents ($5,151.30), making their one-half two thousand and five hundred and seventy-five dollars and sixty-five cents ($2,575.65) this amount to be paid in cash."

On November 18, 1913, defendant executed his promissory note to plaintiff, agreeing to pay him on May 1, 1915, the sum of $3,650, and to secure it the defendant and his wife executed a mortgage on the one-half undivided interest of the defendant in and to all of the Meade county land, including the Grahamton mill tract. After the note became due, Bridgeford sold his one-half undivided interest in all of the Meade county land to one Hubbard, who in turn sold it to plaintiff, whereby he became a joint owner of one half of the land, with the defendant owning the other half. In the meantime Bridgeford and the defendant had neglected to pay the taxes assessed against the land, and for several years it was sold by the sheriff of Meade county under a levy made upon it to collect the taxes, and at the sales the plaintiff became the purchaser, and for at least some of those sales the sheriff in due time executed to plaintiff a deed, after, as it is insisted, fully complying with the law in regard to such matters.

This suit was filed on December 27, 1915, seeking the collection of the note before mentioned and an enforcement of the mortgage lien upon the land as well as a lien for the defendant's portion of the taxes which plaintiff had paid. During the progress of the cause taxes for other years accrued which were likewise paid by the plaintiff, by him purchasing the property in the same way, and he amended his petition so as to include those items. After the mortgage to plaintiff had been executed, defendant and wife executed another one to E. H. Morgan for the sum of $1,800, and before the order of sale, he, by appropriate pleadings, was brought into the case and asserted his lien.

A number of matters are relied upon by defendant and his wife in their defense, the chief of which was that defendant had not received his proportion of rents under the lease to which he was entitled. It was also insisted by defendant that the lands could not be divided without materially impairing their value, and since plaintiff had become a joint owner, a sale of the land in its entirety was insisted upon by defendant. With the condition of the accounts between plaintiff and defendant unsettled and undetermined, and by agreement of parties, the court at its April, 1916, term ordered a sale of all of the property for the two purposes of division and the enforcement of the liens upon defendant's one-half. In due time the land was sold by the master commissioner as directed by the judgment, and the plaintiff became the purchaser at the price of $9,976; it having been appraised at $8,400. Bonds were executed for the purchase price, and the sale was reported and confirmed without exceptions. After the sale plaintiff filed a pleading styled "An Amended Reply and Amended Petition" in which, among other things, he claimed the right to collect from defendant his proportion of the sum which Bridgeford and himself had agreed to pay under the second clause of the lease which we have hereinbefore quoted, and which sum so claimed to be due from the defendant was $1,287.82, being one-half of the amount which Bridgeford and defendant agreed to pay under the clause of the lease referred to, and it was alleged in that pleading that defendant's portion of the rent which he claimed had not been paid had been credited on that sum, which plaintiff asked the court to approve and to give him judgment for the balance due from defendant under the second clause of the lease.

The right of plaintiff to collect from defendant in this or any other manner the item of $1,287.82 was, in the court below and is here, strenuously resisted, upon the ground that it was a lien upon the land (the lease having been acknowledged and recorded), and that plaintiff, when he bought the land, did so with that lien or incumbrance upon it, and his purchase was made subject thereto, and in that way it became extinguished; that to again require defendant to pay it would be exacting of him two payments of the same item, which, if true, is manifestly incorrect and will not be tolerated. All other disputed items except the one just mentioned were agreed upon, and a stipulation containing an agreement of facts was filed in the case, and the cause was submitted for judgment, adjusting the rights of the parties in and to the proceeds of sale, and the court rendered judgment, charging defendants one-half of the proceeds with the lease item of $1,287.82 and interest thereon from May 1, 1915 (which was the date of the expiration of the first three-year term of the lease), and to this action of the court the defendant complains, and by this appeal seeks its correction.

The briefs of counsel, while not so voluminous, contain a discussion of multiplied questions, many, and indeed the greater portion, of which according to our view are not relevant to the question presented. We shall consider such of them as we think relate to a correct determination of the controversy, omitting those which we deem foreign thereto.

The argument of counsel for defendant is that the item of $1,287.82, with which defendant was charged in the judgment, is an agreement by the lessor to pay for improvements put upon the premises by the lessee, and in law becomes a lien upon the premises, and that defendant at the time of his purchase had actual knowledge of such lien, to say nothing of constructive knowledge arising from the recording of the lease, and that his purchase was therefore "subject to" this alleged lien; that he took the property under his purchase burdened with that lien, and he necessarily fixed his bid with that amount in contemplation, therefore correspondingly reduced his bid, resulting in defendant's property discharging it, and to again require him to pay this it would constitute double payment. Another insistence is that if the first position be incorrect, then the item complained of was not due at the time of the rendition of the judgment, which was on January 24, 1917, and would not be due until the 1st of May following, at which time the extension privilege of the lease for two years would expire, and the disputed item, if payable at all, would become due.

Conceding without determining that the item in question as between lessor and lessee became a lien upon land, the vital question remains whether the sale was made subject to it; i. e whether the purchaser bought the entire unincumbered title under the judgment, or whether he bought it to be reduced by the amount of the lien. At the beginning it will be well to notice that plaintiff's pleading before the rendition of the judgment of sale charged that all liens for which the land was liable were contained and set forth therein, and we do not find this statement anywhere denied by the defendant. So that it would appear that he was willing for the judgment of sale to be based upon such admitted allegation. But,...