Lester v. Snyder

• Decision Date: 12 December 1898
• Citation: 55 P. 613,12 Colo.App. 351
• Parties: LESTER et al. v. SNYDER.
• Court: Colorado Court of Appeals

55 P. 613

12 Colo.App. 351

LESTER et al. v. SNYDER.

Court of Appeals of Colorado

December 12, 1898

Appeal from district court, Arapahoe county.

Action by Charles M. Snyder against John C. Lester and another. From a judgment for plaintiff, defendants appeal. Reversed.

Fillius & Davis, for appellants.

Jo A Fowler (F.D. Taggart, of counsel), for appellee.

WILSON J.

This action was brought to restrain a sale of real estate under a deed of trust, and also for the cancellation of the trust deed, of the note to secure which it was given, and of an agreement extending the time of payment of the note, under a plea of payment. It appears that in July, 1887, one Charles T. Snyder applied to H.J. Aldrich, president and manager of the Colorado Securities Company, doing business at Denver Colo., to obtain for him a loan of $3,000 for the period of five years, to be secured by deed of trust upon his ranch of 320 acres in Park county, Colo. Aldrich applied to the Wilson & Toms Investment Company, of St. Louis, Mo., and this company found in Daniel Steele, one of their clients, a citizen of Massachusetts, and one of the defendants, a person who was willing to make the loan. Thereupon the note, the deed of trust, and coupon interest notes were prepared, the money transmitted by Mr. Steele to the investment company and by it to Snyder, through the Colorado Securities Company. The principal note and each of the coupon notes were dated at St. Louis, and were expressed upon their face to be payable to defendant Steele at the office of the investment company in St. Louis. By a separate agreement in writing the Colorado Securities Company guarantied the payment of the note and interest. Subsequently, and before the maturity of the note the title to the ranch became vested in Mrs. S. Emma Snyder, the wife of the original payor. The interest seems to have been paid regularly. The securities company seems to have generally given notice when this was due, and upon receiving payment forwarded it to the investment company, or to the Central Trust Company, which became the successor to the Wilson & Toms Investment Company, and by this company it was transmitted to Mr. Steele, who then returned the coupon note so paid to the trust company, and it was by this company returned to the payor through the securities company. The principal note was due August 1, 1892. Shortly before its maturity, Mrs. Snyder applied to Aldrich to know if she could secure an extension of the note for the period of five years, and employed Aldrich to secure such extension. Her language in reference to this, as set forth in her testimony, was as follows: "When I asked for an extension of this loan, I employed Mr. Aldrich to get it. I asked him whether it could be extended, and he said he did not know; he thought so. And I said to him, 'I supposed it was altogether as you say,' and he said no, he would have to consult some Eastern party." Aldrich communicated the desire of Mrs. Snyder for an extension to the trust company at St. Louis, and it to Mr. Steele, who consented upon condition that $500 of the principal be paid, and that Mrs. Snyder agree to keep the loan for another five years, to wit, from August 1, 1892, to August 1, 1897. Thereupon the following extension agreement was drawn up, and signed by Mrs. Snyder: "Extension Agreement and Coupons. St. Louis, Mo., July 28, 1892. Whereas, Daniel Steele has agreed to extend the time for the payment of a loan of $2,500, secured by a trust deed made and executed by Charles T. Snyder, dated July 15, 1887, and by the terms thereof due August 1, 1892, for the term of five years: Now, in consideration of such extension, I hereby agree to keep said loan for the term of five years from August 1, 1892, and further agree to pay interest on the principal of said debt according to the tenor and effect of certain extension coupon notes, signed by me, of even date herewith; and in case of any default in payment of interest, or in case of nonpayment of taxes assessed on the mortgaged premises, or of a breach of any of the covenants in said trust deed contained, it shall be optional with said mortgagee to declare the principal of said debt immediately due and payable, and the same may be collected according to the terms and conditions of the said trust deed and principal note, time being the essence of this contract for extension. [ Signed] S. Emma Snyder." By whom this agreement was drawn does not appear from the evidence, but it was presented to Mrs. Snyder by Aldrich, and, upon being signed, was transmitted by him to the trust company at St. Louis, together with the $500 to be paid on the principal, and by this company both were transmitted to defendant Steele. At the same time coupon interest notes for the extended time were signed by Mrs. Snyder, and transmitted with the agreement. All these were payable to Daniel Steele, and at the office of the Central Trust Company in St. Louis. For his services in securing this extension, Mrs. Snyder paid to Aldrich $250. About December 28, 1893, Mrs. Snyder, through Aldrich, negotiated the sale of 140 acres of the ranch property to Mrs. Lydia L. Cowell. On the same date the Colorado Securities Company executed to Mrs. Cowell its agreement in writing, as follows: "[Letter head of the Colorado Securities Company.] Denver, Colo., December 28, 1893. In consideration of the payment of $500, to be applied on a loan of $2,500 given by Mrs. S. Emma Snyder, and secured upon land in Park county, we hereby agree with Mrs. Lydia L. Cowell that upon the payment by her of $1,800 in addition to the above-named $500, together with accrued interest on the full amount to the date of payment, that we will release from our deed of trust the land purchased by her from Mrs. S. Emma Snyder as described in a deed held by us and executed by Mrs. S. Emma Snyder, conveying said land to said Lydia L. Cowell. Said above-named payments to be made within ninety days from date of this agreement. [ Sgd.] The Colorado Securities Co., by H.J. Aldrich, Pt." About this time there is some evidence of an application by Aldrich to the trust company to secure a release from the deed of trust of 150 acres of land,--presumably that sold to Mrs. Cowell,--and the substitution of another and similar loan, to be secured upon the remainder of the land. The trust company wrote him in reply that, if he would forward her new application, they would submit the entire matter to their client, Mr. Steele, who held the present loan, and would arrange with him, if possible, to do so. This seems to have gone no further, however, and it does not appear from the record that the proposition was ever submitted to Mr. Steele. Aldrich continued to collect from Mrs. Cowell the money due upon her purchase, and Mrs. Snyder says that it was her understanding that this money was to be applied upon the payment of the Steele note. No part of it, however, was ever so applied. In 1894, Charles M. Snyder, plaintiff in the case, became the owner of the ranch by deed from his mother, Mrs. S. Emma Snyder. In February, 1896, default having been made in the payment of the interest coupon notes due on the 1st day of the month and on the 1st day of August previous, Mr. Steele, as was provided in the deed of trust, declared the whole of the indebtedness due and payable, and directed the trustee, defendant Lester, to sell the property. Thereupon this suit was instituted.

There is no pretense or claim that any payment was ever made directly to Steele. All of the payments contended for by the plaintiff were the collections made by Aldrich, growing out of the sale of part of the land to Mrs. Cowell. The whole controversy, then, hinges upon the question as to whether or not Aldrich was the authorized agent to receive such payments so as to charge the principal, Steele. Upon the trial the court called a jury for advisory purposes and submitted to it this question of agency, and it was found in favor of plaintiff's contention. There was no evidence adduced showing or tending to show that...