Merchant's Bank of St. Louis v. Harrison

• Decision Date: 28 February 1867
• Parties: THE MERCHANT'S BANK OF ST. LOUIS, Respondent, v. ROBERT HARRISON, et al., Appellants.
• Court: Missouri Supreme Court

39 Mo. 433

THE MERCHANT'S BANK OF ST. LOUIS, Respondent,

v.ROBERT HARRISON, et al., Appellants.

Supreme Court of Missouri.

February Term, 1867.

Appeal from Livingston Circuit Court.

The plaintiff asked the court to give the following instructions:

1. If the plaintiff and defendants both claim the land in controversy through Jasper N. Bell, then it is sufficient prima facie for the plaintiff to prove its derivation of title from said Bell without proving said Bell's title.

2. If Jasper N. Bell took possesson of the land in suit in 1854 by cutting timber on it and making rails, exercising the usual acts of ownership over it, and claimed the whole of said land to be his, and in the spring of 1854 fenced a field on said land, and exercised the usual acts of ownership over the whole of said land up to 1862, and then sold said land to plaintiff, and continued by himself or sub-lessee to keep possession of said land for plaintiff up to September, 1864,--plaintiff has a good title to said land unless said title was divested by the sheriff's deed read in evidence.

3. The sheriff's deed read in evidence passes no title to the Bank of the State of Missouri.

4. If an execution was issued from the Buchanan Court of Common Pleas, dated 10th December, 1861, and came into said sheriff's hands on the 19th of said month, and was levied by him on the land in suit on the 20th day of said month by endorsing thereon that he had made said levy; and afterwards, in January, 1862, he resigned his office of sheriff, and said execution in May, 1862, came to the hands of the coroner of said county, and was by him levied on as property of the defendant in said execution, and said property was sold by said coroner, and afterwards the sheriff who resigned sold the land in suit, his deed passes no title.

5. In order to entitle the defendants to maintain their defence under said sheriff's deed, as late sheriff of Livingston county, it is necessary for them to show both an execution and a judgment to authorize said sheriff to execute said deed.

6. If neither plaintiff nor defendants have title to the land in suit, the party having prior possession is entitled to recover.

Which the court gave, and defendants excepted.

The defendants then moved the court to declare the law to be as follows:

1. The plaintiff had no right, in order to secure a debt of $2,200 or $2,400, to pay Jasper N. Bell, or any other person, $7,500 in cash for the land in controversy, and therefore the pretended conveyance from said Bell and wife to plaintiff is void.

2. The plaintiff has not shown a sufficient title to the land sued for to maintain his action.

3. If plaintiff purchased the land in controversy with a view to speculation, the pretended conveyance from Jasper N. Bell is void.

4. There is no such corporation as the Merchants' Bank of St. Louis.

5. The verdict should be for the defendants.

6. The plaintiff is not entitled to a verdict unless it has shown a legal title to the land in controversy; and whether the defendants have any title or color of title, is immaterial.

7. That the cutting of timber and making of rails on the land in controversy by Jasper N. Bell, is not such proof of title in him as will enable him, or any one claiming through him, to maintain this action.

The cort gave the 3d, 6th, and 7th instructions, and refused the others, to which refusal defendants excepted.

The deed from J. W. Bell to the Merchant's Bank was dated May 12, 1862.

Vories & Vories, and Carr, for appellants.

I. The fact whether there is or was such a corporation as the respondent, or not, was expressly put in issue by the pleadings. The respondent produced no evidence of its acceptance of the charter, and no organization and user under it. This it was bound to do. The granting of the charter was a mere proposition held out by the State, which the stockholders could accept or not. There is no legal evidence in regard to any of these facts, hence the court below erred in refusing to so declare the law--Ang. on Corp. § 635; R. C. 1855, pp. 727-8, § 26.

II. The powers and authority delegated and granted to a corporation are to be strictly construed--Pearce v. Madison, &c. R. R., 21 How. 441; Sedgw. on Stat. & Const. L. 338; Hoagland v. Han. & St. Jo. R. R. Co. (Feb. Term, 1867); Fowler v. City of St. Jo., 37 Mo. 228.

III. The purchase of the land in controversy by the respondent was a direct violation of the charter of the respondent, hence illegal and void--Sess. Acts 1857, p. 21, § 26; Chatauque Co. Bk. v. Risley, 4 Den. 485; Bk. of Michigan v. Miles, 1 Doug. (Mich.) 401.

IV. The levy of an execution by a sheriff, while it is in full force, and during the term of office of said sheriff vests the title of the execution debtor in such officer, and he can consummate the levy by a sale after the expiration of his term of office, and under said levy and sale the purchaser will acquire a good title--Sess. Acts 1863, p. 29, §§ 2 & 3; Bk. of the State of Mo. v. Bray, 37 Mo. 194; Clark v. Withers, 1 Salk. 322; Tuttle v. Jackson, 6 Wend. 224; Adams v. Robinson, 1 Pick. 461.

V. Beattie & Wilson, had a legal and valid execution levied on said land at the time of the purchase thereof by the respondent. It had notice thereof--they were encumbrancers. The levy vested the title in the sheriff; it was consummated by the sale. The purchaser under such levy and sale acquired a good title.

VI. The respondent was not a bona fide purchaser for value. Beatte and Wilson, by their prior levy acquired the prior and equitable right. In such case the prior right will prevail--Dickerson v. Tillinghast, 4 Pai. 215; 20 Johns. 636; Wood v. Chapin, 13 N. Y. 509; 4 Kent, 168.

VII. It connot be maintained that the purchase of the respondent is good in part. It is tainted with illegality, which, like fraud, vitiates the whole purchase.

VIII. The declarations of law made at the instance of the respondent ignore the defence made by the appellants, and hence are wrong--Sawyer et al. v. Hann. & St. Jo. R. R. Co., 37 Mo. 263; Clark v. Hammerle, 27 Mo. 70. Let it be conceded that the respondent was a creditor of J. N. Bell as well as Beattie & Wilson, the execution creditors; that Beattie & Wilson got their execution on the land in controversy before the respondent got its deed or made its purchase, and the case is narrowed down to a contest between creditors. The respondent is not a bona fide purchaser for value in that case.

The recitals in the sheriff's deed are evidence of the facts therein stated; it was not objected to--R. C. 1855, p. 748. It is the policy of the law to sustain official sales--Draper v. Bryson, 17 Mo. 71. The plaintiff being a banking company, with power to receive deposits, discount bills, notes, &c., had no power to purchase the lands in question for $9,500 merely to offset or commute a debt due it from the vendor of $2,000--Ang. & A. on Corp. § 84 & 85; Id. (N. S.) § 110 & 111; 5 Barb. 613; 4 Shep. 224; 4 Pet. 152; 1 Cow. 686; Kyd on Corp. 104; Ang. & A. § 151 & 152; 4 Denio, 400, 401; 10 Mo. 576; 1 Doug. (Mich.) 401; affirming case, 1 Walker Ch. 99; Coke on Litt., 2 Bk.; 1 Black. Com. 479; 2 Black. 268 & 274; 7 Cow. 540; 13 Pet. 519; 2 Cranch, 127; 4 Wheat. 636 & 593; 6 Wheat. 593; 6 Pet. 371; 9 Cow. 437; 2 Cow. 26, forfeiture for non or mis-user; 2 Cow. 664, 678; 2 Hill. Real Prop. 408, § 22; 15 Johns. 383; 2 Cow. 700, 709, 711; 7 Wend. 31; 3 Wend. 482; 15 Wend. 502; 4 Johns. 370; 7 Cow. 540; 3 Pick. 239; 4 Wheat. 315; 36 Mo. 294; 9 How. (U. S.) 172; 4 Wheat. 636; 12 Wheat. 64; 11 Pet. 544; 13 Pet. 587; 2 Cra. 127.

As to validity of sheriff's deed and the sufficiency of its recitals without a copy of judgment, execution, &c., 18 Mo. 580; § 56 & 52 of Execution law. 10 Sm. & M. 246, affirming same case in Sm. & M. 602.

Plaintiff must prove organization and user under its charter--4 Denio 392; Ang. & A. on Corp. § 635. A corporation must prove its existence under the general issue--Bk. of Utica v. Smalley, 2 Cow. 770; Jackson v. Plumb, 8 Johns. 378; Bk. of Auburn v. Aiken, 19 Johns, 300; Kyd on Corp. 292.

Hall & Oliver, for respondent.

I. The act incorporating plaintiff is valid and constitutional--Farmers' Bk. v. Garten et al., 34 Mo. 119.

II. The purchase by plaintiff of the land in suit was in exact accordance with its charter. The purchase was made for the sole purpose of securing a debt previously contracted in good faith--§ 28, “Act to regulate banks,” &c., Laws of Mo. 1856-7, p. 21.

III. The court below, at the instance of defendants, declared the law to be that if plaintiff purchased the land in suit for purposes of speculation, the transaction is void; but still the court found for plaintiff; in other words, the court found from the evidence that plaintiff did not buy the land in controversy for speculation, but for purposes authorized by its charter. The evidence certainly justified this finding, and the court will not interfere with it--McCullough v. McCullough, 21 Mo. 229.

IV. But, even if the plaintiff did buy the land sued for as a mere speculation, the defendants cannot avail themselves of this fact. The rule is, that while the right of a corporation to hold land is limited to the necessities of the company, yet if the owners of the land desire to convey it to the corporation, the right to hold the land is a question between the corporation and the public--Redf. on Railw. 105, n. 4; 11 Wend. 149; 3 Coms. 516; Ang. & A. on Corp. § 152 & 153; 5 Denio, 400-1; 7 S. & R. 318; 7 Barb. 239; 2 How. 191.

V. On the trial of this case defendants attempted to set up an outstanding title in a stranger in order to defeat plaintiff's recovery. The court below properly refused to permit this to be done: 1. Because defendants in their answer set up title in themselves; 2. Because defendants wrongfully and without title entered on the possession of defendants and were trespassers; Because the outstanding title relied on by defendants was barred by the statute of limitations--20 Mo. 104; 21 Mo....