Logan v. Mitchell
| Decision Date | 30 April 1878 |
| Citation | 67 Mo. 524 |
| Parties | LOGAN et al., Plaintiffs in Error v. MITCHELL. |
| Court | Missouri Supreme Court |
Error to Hannibal Court of Common Pleas.
The petition in this case set forth that the defendant, Gideon Mitchell, being largely indebted to the plaintiffs on promissory notes, on which the defendants, Joab Mitchell and Cary, were sureties, on the 26th day of January, 1874, executed to said Joab Mitchell and Cary a mortgage on certain lands in Marion county, by way of indemnifying them against any payments they might have to make on said notes. The petition showed that the notes were due and unpaid, and prayed that the plaintiffs might be substituted to all the rights of said Joab Mitchell and Cary in respect of said mortgage, that the lands described in it might be sold, and the proceeds should be applied in payment of plaintiffs' claims.
Sarah and Caroline Basket and Mary Webb were made defendants, as parties to a second mortgage upon the same lands. They set up in their answer that defendant, Gideon Mitchell, had executed this mortgage to secure the amount of his several notes due to them severally; that when he executed the first mortgage Gideon Mitchell was and ever since has been insolvent and largely indebted, and the land conveyed in said mortgage was all that he held exempt from execution; that the notes held by defendants, Sarah and Caroline Basket and Mary Webb being due and unpaid, they were, on the 6th day of May, 1874, about to institute proceedings in bankruptcy to have said Gideon Mitchell adjudged a bankrupt, and said first mentioned mortgage set aside and adjudged null and void; that on said last mentioned day the said Cary and Joab Mitchell, in consideration of defendants, Sarah and Caroline Basket and Mary Webb, agreeing not to institute said bankruptcy proceedings, executed and delivered to them a written obligation, by which they covenanted and agreed that said Sarah and Caroline Basket and Mary Webb should share and participate with them, pro rata, according to their said several debts, and whereby said Cary and Joab Mitchell further assigned and transferred to them a pro rata share and proportion of the proceeds arising from the sale of the lands mentioned in said first mentioned mortgage under a foreclosure thereof, and whereby they further ordered and directed the sheriff of Marion county, or other persons in whose hands such proceeds might be, to pay these defendants severally out of such proceeds a pro rata share thereof, according to the respective debts of the defendants last spoken of, with those for which said Cary and Joab Mitchell were sureties; that these defendants kept their agreement and did not institute said bankruptcy proceedings, by which said first mortgage could have been set aside, and the time for commencing such proceedings having long since passed, and their debts being unpaid, said Sarah and Caroline Basket and Mary Webb ask for judgment against said Gideon Mitchell, that the lands might be sold as prayed for by plaintiffs, and that they might be paid out of the proceeds of the land pro rata with plaintiffs.
To this answer plaintiffs demurred, substantially on the ground that the agreement set up in the separate answer of the defendants, made by them with said Cary and Mitchell, did not bind plaintiffs; that said Cary and Joab Mitchell had no right to make such agreement, and that defendants could claim nothing by reason of the same, and therefore were not entitled to share with plaintiffs in the proceeds arising from the sale of the land sought to be sold. The demurrer was overruled by the court. The plaintiffs stood upon the demurrer, and the answer was taken as confessed. The court rendered a final decree, ordering a distribution of the proceeds of the land, which, by agreement, under an interlocutory order had been previously sold. In the decree the court declared a substitution of the plaintiffs to all the rights of Cary and Joab Mitchell to and in the first mortgage, subject to the claim of Sarah and Caroline Basket and Mary Webb to participate pro rata with them according to the agreement with Cary and Joab Mitchell. The sum coming to plaintiffs under this decree was insufficient to pay their claims, and they appealed.
Wilson & Anderson for plaintiffs in error argued that the plaintiffs' interest vested in said property the moment the deed of mortgage was executed by said Gideon Mitchell to said Cary and Joab Mitchell, sureties; and that the agreement subsequently made between said sureties (Cary and Mitchell) and Sarah Basket, Caroline Basket and Mary Webb, by which they were to have a pro rata share with the plaintiffs in the proceeds of the mortgaged property, was void,...
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