Mark v. Maberry, 5-134

CourtSupreme Court of Arkansas
Writing for the CourtMcFADDIN
Citation222 Ark. 357,260 S.W.2d 455
PartiesMARK v. MABERRY et al.
Docket NumberNo. 5-134,5-134
Decision Date29 June 1953

J. B. Milham, Eureka Springs, for appellant.

A. J. Russell and Festus O. Butt, Eureka Springs, for appellee.

McFADDIN, Justice.

This is a suit to determine priority as between two mortgagees. The Chancery Court decided in favor of Maberry; and Mark has appealed.

In 1948 Mark was the owner of certain real and personal property in Eureka Springs, known as the Allred Hotel and its furnishings. Loucks, a real estate agent claiming to act for Mark, sold the Allred Hotel and furnishings under the terms of a contract dated April 28, 1948, and reading in part:

'Received of Cecil Maberry, for a corporation to be hereafter formed, the sum of $500.00, as earnest money for the purchase of the Allred Hotel in the City of Eureka Springs, all furnishings and everything in connection therewith for Anson Mark, the owner of said property, and for whom I am acting as agent.

'This is on condition that $8,500.00 more in cash will be paid as soon as the legal papers can be drawn to carry out this contract and the abstract of Mark brought down to date, showing clear title to everything in connection with the hotel.

'It is understood that Cecil Maberry as agent for the corporation, aforesaid, is to place a Mortgage upon said property not to exceed $15,000.00, and that he shall give a second mortgage to the said Mark for $10,000.00, subject to said first Mortgage, * * *.

'It is understood hereby between the parties that the said Maberry as said agent, who will expedite the drawing of the necessary papers and forming the corporation and paying the balance of the purchase money, and that upon the said Maberry, as aforesaid, completing his part of the deal, the said Mark shall at once give a Warranty Deed for the building, furniture, fixtures, equipment, and all other personal property now used in connection with the said hotel and owned by the said Mark * * *.'

In pursuance of the said contract, Cecil Maberry organized an Arkansas corporation, styled 'Springs Investment Company'; Mark and wife executed a Warranty Deed to Springs Investment Company, dated May 18, 1948; Springs Investment Company executed a first mortgage to Cecil Maberry to secure $15,000; and Springs Investment Company executed the second mortgage to Mark for $10,000. The $15,000 mortgage was filed a few minutes prior to the $10,000 mortgage.

On October 25, 1952, Mark filed the present suit against the Corporation, and also against Cecil Maberry, 1 J. A. Maberry, and V. M. Anderson. Mark is now claiming:

(a) that Mark's mortgage for $10,000 is prior and superior to the $15,000 mortgage held by Maberry;

(b) that Cecil Maberry, J. A. Maberry and V. M. Anderson, as incorporators and officers of Springs Investment Company, are each personally liable to Mark for the $10,000 balance due him by the Corporation; and

(c) that a chattel mortgage executed in 1949 by Springs Investment Company to Maberry on furnishings then purchased, is junior to the $10,000 mortgage held by Mark.

As aforesaid, the Chancery decree was adverse to Mark on each contention, and he has appealed.

I. Superiority as Between Mark's Mortgage and Maberry's Mortgage. The mortgage held by Mark recites: 'This mortgage is junior and subject to a prior mortgage for $15,000.00 executed by same grantor to Cecil E. Maberry * * *.' Our cases hold that a mortgagee, who accepts a mortgage which recites a prior mortgage, is estopped to deny the superiority of the prior mortgage. Clapp v. Halliday, 48 Ark. 258, 2 S.W. 853; Gibson v. Doughty, 193 Ark. 1037, 104 S.W.2d 449.

To overcome the application of the cited cases, Mark claims that this recital in his mortgage is fraudulent, was never authorized by him, and never known by him. Thus it becomes necessary to recite some of the salient testimony as to the sale of the hotel property by Mark.

Loucks, a real estate agent in Eureka Springs, testified that she represented Mark, and in such capacity, signed the contract with Maberry, as previously quoted. Loucks testified that she sent the contract to Hunter, 2 a lawyer in Chicago, who had theretofore corresponded with her and who claimed to be Mark's attorney. On May 18th, Mark and wife executed the deed to Springs Investment Company, conveying all the real and personal property; and the acknowledgment of that deed was taken by Robert L. Hunter, as Notary Public, in Cook County, Illinois; and that is the same name as the attorney who wrote the letter to Loucks previously mentioned. The notes and mortgage now sued on by Mark were forwarded to Mark, and Loucks received her real estate commission for closing the trade.

It is true that the agent's declarations--i. e., the statements in the contract of sale--are not admissible to prove agency, but only to corroborate other evidence tending to establish agency. 3 Nevertheless, the agency can be established by circumstances; and any evidence tending to establish agency is admissible, including the testimony of the agent. 4

At the time Mark signed the deed to Springs Investment Company, he could not have known of the existence and name of such corporation, except through the agency of Loucks to execute the original contract: Mark accepted the fruit of Louck's agency for him, and cannot now be heard to disclaim such agency. Rose City Mercantile Co. v. Miller, 171 Ark. 872, 286 S.W. 1010. It therefore follows that Loucks' agency was established; and accordingly, Mark is bound by the provisions of the Loucks contract and the recital in the Springs Investment Company mortgage, to the effect that the mortgage held by Mark is secod to a $15,000 first mortgage to Maberry on the same property.

II. Mark's Claim for Personal Judgment. The Articles of Incorporation of Springs Investment Company recite the incorporators officers, and number of shares held by each to be as follows:

                Cecil Maberry, President & Treasurer,  148 shares
                J. A. Maberry, 5

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9 cases
  • Capital Associates, Inc. v. Sally Southland, Inc., 57595
    • United States
    • United States State Supreme Court of Mississippi
    • 20 Julio 1988
    ...that the contract was thus ratified. More than that, the company accepted payments from Sawyer of over $600.00. In Mark v. Maberry, 222 Ark. 357, 260 S.W.2d 455, we held that when one accepts the fruit of another's agency in the sale of property, he cannot subsequently be heard to disclaim ......
  • Peoples Federal Sav. & Loan Ass'n v. Myrtle Beach Golf & Yacht Club, A-P
    • United States
    • Court of Appeals of South Carolina
    • 22 Enero 1992
    ...with a provision that it is subordinate to a prior mortgage is estopped to deny the superiority of the prior mortgage. Mark v. Maberry, 222 Ark. 357, 260 S.W.2d 455 (1953); 31 C.J.S. Estoppel § 39 (1964). This species of estoppel is often referred to as estoppel by deed as distinguished fro......
  • Sawyer v. Pioneer Leasing Corp., 5-4501
    • United States
    • Supreme Court of Arkansas
    • 27 Mayo 1968
    ...that the contract was thus ratified. More than that, the company accepted payments from Sawyer of over $600.00. In Mark v. Maberry, 222 Ark. 357, 260 S.W.2d 455, we held that when one accepts the fruit of another's agency in the sale of property, he cannot subsequently be heard to disclaim ......
  • B. J. McAdams, Inc. v. Best Refrigerated Exp., Inc., 78-312
    • United States
    • Supreme Court of Arkansas
    • 23 Abril 1979, neither agency nor the scope of agency can be established by declarations or actions of the purported agent. Mark v. Maberry, 222 Ark. 357, 260 S.W.2d 455; Zullo v. Alcoatings, Inc., 237 Ark. 511, 374 S.W.2d 188; Smith v. Hopf, 219 Ark. 127, 240 S.W.2d 2. Another obstacle is the fac......
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