Johnson v. Van Velsor

• Decision Date: 08 April 1880
• Citation: 43 Mich. 208,5 N.W. 265
• Court: Michigan Supreme Court
• Parties: JOHNSON v. VAN VELSOR. VAN VELSOR and others v. JOHNSON.

5 N.W. 265

43 Mich. 208

JOHNSON v. VAN VELSOR.

VAN VELSOR and others v. JOHNSON.

Supreme Court of Michigan

April 8, 1880

Proof to show a deed absolute in form to be a mortgage must be clear and convincing. A decree in foreclosure will be given for everything due at the time it is granted. Evidence considered, and held insufficient to establish the non-execution and acknowledgment by the wife, of a mortgage. The bare oath of a party is not sufficient to rebut an official certificate of acknowledgment. Various minor questions peculiar to the case considered and disposed of.

Appeal from Barry.

L.E. & C.M. Kappen, for appellant.

C.G. Holbrook and James Clarke, for defendant.

GRAVES J.

This is a litigation by bill and cross-bill growing out of a mortgage transaction. Some explanation from the record is necessary. May 6, 1871, one John R. Van Velsor mortgaged to Johnson, city lots 1, 2, 3, 4 and 5, of Grant's addition, in Hastings, and 40 acres of section 27, in Irving, and 30 acres of section 8, in Castleton, all in Barry county, for an expressed consideration of $1,500. The mortgage was accompanied by Van Velsor's bond. By the terms of the papers, which bore date May 5th, the principal was to be paid in five years, with interest at 10 per cent payable semi-annually, and all payments were required to be made at the First National Bank of Marshall, with current rates of exchange on New York.

Both bond and mortgage contained the common interest clause giving the mortgagee an option to consider the whole due in case of a continuing default for 30 days; and the mortgage further contained what is called the insurance clause, and the clause in regard to taxes, and there was also a provision for an attorney's fee of $50. The mortgage purported to be executed by Mrs. Van Velsor, the wife of the mortgagor, and was signed by James Cloes and H.W. Rolfe as attesting witnesses, and its execution by both Van Velsor and wife was authenticated by the formal certificate of acknowledgment made by Rolfe as notary public. The instrument was recorded May 6, 1871. January, 1874, Van Velsor died, leaving Eliza A Van Velsor his widow, and two infant children, Leon D., of the age of about six years, and Wendell P., of about two years. From a time prior to the mortgage the city lots have been occupied together, and until his death Van Velsor so occupied them with his family as his homestead, and since that event his widow has continued the homestead occupation. The dwelling and other buildings appear to stand on the line between lots 1 and 2.

July 18, 1874, Johnson filed the original bill to foreclose the mortgage, and he charged, among other things that a considerable amount of interest had accrued and fallen due, and had remained due and unpaid for more than 30 days, and that pursuant to the provisions of the mortgage he elected to consider the whole amount due and payable, and so declared. Mrs. Van Velsor and her two children were made defendants, and one Preston Hart and Samuel Brandt were joined as subsequent purchasers or encumbrancers. There were no representatives of the estate.

December 28, 1874, the infants, by their guardian ad litem, answered the bill. They alleged, on information and belief, that the expressed consideration in the bond and mortgage, in so much as it exceeded $1,000, was false and usurious. They further claimed that there had been no valid election to cause the whole amount to be immediately due and payable, and that not to exceed $150 was actually due. They also set up, as I think, in substance, that the city lots were exempt. About the time of this answer the infant Wendell P. died, and some time later his death was suggested, and an order to revive was entered. Mrs. Van Velsor abstained from answering, and December 2, 1876, the bill was taken as confessed by her. March 5, 1877, she filed her petition to vacate the order pro confesso and for leave to answer, but the petition appears to have been allowed to drop. There is no evidence of any attempt to have it heard, and there is nothing to show that its existence was ever actually made known to the court.

March 10, 1877, the surviving infant, by his guardian ad litem, united with Mrs. Van Velsor in a cross-bill, but making no one defendant except the complainant in the original bill.

October 14, 1878, he answered, and the cross cause was put at issue. This bill set up that the two complainants therein were equitable owners and actual occupants of the mortgaged premises; that Van Velsor at his death occupied the city lots as a homestead, and that his wife and family have occupied it since in the same way; that he died intestate, and she, thereupon, as his widow, became tenant in dower in the mortgaged premises, and the children became seized of the fee-simple as his heirs at law, and that, by the subsequent decease of the younger, his interest had passed to his brother, the surviving infant. Mrs. Van Velsor then denies having joined in the mortgage, and avers that she never signed it or acknowledged it. She insists upon a right of homestead during the minority of the remaining child, and full right of dower in all the premises. The cross-bill has some grave formal defects, at least, but it is not important to dwell upon them.

March 24, 1879, an interlocutory decree was made, finding the whole amount due and specifying the same, and allowing Mrs. Van Velsor to select a homestead on the parcel embracing the city lots, and requiring payment of the mortgage debt within a time given, and, in case of default, referring it to a commissioner to inquire into the value of the premises, and their situation in regard to deeds and encumbrances later than the mortgage, and to take necessary proofs, and report the same with his opinion.

May 10, 1879, the commissioner made his report, from which it appeared that Mrs. Van Velsor had selected her homestead, and it further appeared that on October 5, 1872, she had joined with her husband, the mortgagor, in an absolute deed of the entire mortgaged premises to one Samuel Brandt; that Brandt and wife had deeded absolutely, on the tenth of August, 1875, to William Becker; and that Becker and wife had recently, and on the twenty-second of October, 1877, deeded in the same way to Mrs. Van Velsor. It also appeared that she swore before the commissioner that the deed to Brandt was given simply as security, and that the conveyance to herself from Becker was brought about by means of a suit in chancery, instituted by herself and child, to recover the property. The proceedings in that case do not appear, and there is nothing else to show that the deed to Brandt did not pass the equity of redemption. The commissioner expressed no opinion about it.

June 17, 1879, the court allowed a rehearing, on the application of Johnson, and afterwards, on the twenty-second of November, 1879, made a final decree. It confirmed the report of May 10th, and sanctioned Mrs. Van Velsor's claim and selection of homestead, and her claim of dower. It also allowed the whole mortgage debt, except small items of interest which had been credited, and provided for a sale of the unexcepted interests. It is too long to be noticed in detail. No attempt was made to distinguish between the original and cross cases. The complainant Johnson appealed. The other parties acquiesced.

There is no room for argument on this record that the absolute conveyance to Brandt put an end to the legal title in Van Velsor, and extinguished whatever groundwork there may have been for a right of homestead, or of dower, against the mortgage. It is not to be assumed that there is anything here which ascertains and settles that the transaction with Brandt was a mere mortgage, and that accordingly there remained an equity, which can be made available in the litigation, to support a right of homestead, or of dower, against the mortgage. Granting that the deed to Brandt was, as it appears, an absolute conveyance, and it follows that the old estate was entirely divested, and Becker's deed to Mrs. Van Velsor, during the suit, did not operate, by relation to the time of the deed to Brandt, and do away with the intervening want of title. The legal connection with the ownership, and all right of homestead incident to ownership, was severed and gone, and the effect of the deed from Becker was to institute a new ownership, and confer it upon Mrs. Van Velsor. It did not revive and restore any former right of homestead. Mrs. Van Velsor became and remains a holder, not as the widow of John R. Van Velsor, nor as proprietor of a homestead right incident to any title which was in him at his death, but simply as grantee of Becker.

Wherever the controversy allows a party to control, by parol evidence, the operation of an instrument which is made and held out as an absolute conveyance, and to show the transaction to have been only a mortgage, the court will require the proof to be clear and convincing, and will not be satisfied with mere general declarations by the party setting up the claim. Thornbrough v. Baker, Howard v. Harris, and notes, 3 L.C. in Eq.; Campbell v. Dearborne, 109 Mass. 130.

The showing in this record is exceedingly meagre. But, as the case was not argued on this theory, and it may be disposed of consistently on another ground, the subject will not be discussed. The practice in the case has not been neat and accurate, and the printed record is not well prepared. But no defects are noticed of sufficient moment to prevent the court from entertaining the cause of action, or from considering the defence. The circumstance that the original bill was taken as confessed by Mrs. Van Velsor is of no special importance. The parties did not permit it to affect their dealing with the merits....