Missouri Real Estate Syndicate v. Sims

• Decision Date: 11 December 1906
• Citation: 98 S.W. 783,121 Mo.App. 156
• Parties: MISSOURI REAL ESTATE SYNDICATE, Respondent, v. SIMS, Appellant
• Court: Missouri Court of Appeals

98 S.W. 783

121 Mo.App. 156

MISSOURI REAL ESTATE SYNDICATE, Respondent, v. SIMS, Appellant

Court of Appeals of Missouri, St. Louis

December 11, 1906

[Copyrighted Material Omitted]

Appeal from Greene Circuit Court.--Hon. James T. Neville, Judge.

AFFIRMED.

STATEMENT.--In 1894 George P. Miller owned lot No. 5 and six feet and six inches off the east side of lot No. 6, all in block No. 36 in the town of North Springfield, Greene county, Missouri. On December 12, 1894, Miller and wife executed a deed of trust to James Bray, trustee, for the benefit of George Lawrence to secure the payment of a note of four thousand dollars to said Lawrence, due two years after date and bearing interest from date at the rate of eight per cent per annum, payable semiannually. Among others, the deed of trust contained the following covenants:

"And the said parties of the first part also covenant and agree with the said party of the third part and his assigns, that they will cause the buildings on said premises to be insured against cyclone for a sum not less than $ 2,000 by such insurance company as may be selected by the said party of the third part, for a sum not less than three thousand dollars (against loss by fire), and that said parties of the first part will pay all premiums for said insurance, and assign said policy of insurance to said party of the third part, and that said parties of the first part will continue said insurance in force and assigned as aforesaid, until the debts herein secured shall be fully paid off and discharged. In case said parties of the first part shall fail to keep insurance on said buildings to the said amount, at any time while the said debts are unpaid, the said party of the third part, or his assigns, may, at his or their option, either cause said premises to be sold under the terms of this instrument by the party of the second part, or the substitute hereinafter provided for him or said party of the third, or his assigns, may insure said buildings to said amount, and any money paid out in effecting and continuing such insurance shall become a debt and lien on said premises, secured by this deed of trust in the same manner as the debt herein mentioned, and any amount so expended for insurance shall bear eight per cent interest per annum from the date of such payment."

On January 28, 1895, Miller and wife, by general warranty deed conveyed the property to E. J. Kerr, subject to the Bray deed of trust. On February 8, 1895, E. J. Kerr and her husband, by general warranty deed, conveyed the property to the Springfield Milling Company, a corporation, subject to the Bray deed of trust. On January 19, 1897, the Springfield Milling Company conveyed the property to Helen Coombs, who assumed and agreed to pay the four thousand dollar note secured by the deed of trust. On July 29, 1898, Helen Coombs and her husband conveyed the property to J. A. Bryant, subject to the Bray deed of trust. On August 1, 1898, Bryant and wife conveyed an undivided one-half interest in the property to J. S. Platt and C. J. Robertson, subject to the Bray deed of trust. On February 6, 1899, Bryant and wife, Platt and wife and Robertson and wife conveyed the property to plaintiff, subject to the Bray deed of trust. On July 30, 1900, James Bray, as trustee, sold the property under the deed of trust and conveyed the same to James Sims, the defendant. It is shown by the evidence that John Coombs, the husband of Helen Coombs, negotiated the purchase of the property from the Springfield Milling Company. At the time this purchase was made the note secured by the Bray deed of trust was overdue, and Lawrence, the beneficiary, was threatening a foreclosure. Coombs declined to purchase the property unless an extension of the time of payment of the note could be secured, and he and the Milling Company induced Sims, the defendant, in consideration of one hundred dollars paid to him by the Milling Company, and of the collateral agreement of Coombs to pay the four thousand dollar note, to purchase the note of Lawrence and give a five years extension of the time of of payment. A memorandum of this agreement was reduced to writing and is as follows:

"This contract, made and entered into by and between John Coombs of the first part and James M. Sims of the second part, witnesseth: That, whereas, the said Coombs is about to contract with the Springfield Milling Company of Springfield, Missouri, for the purchase of lot five (5) and six feet and six inches off of the east side of lot six (6), all in block 36, in the original town of North Springfield, now a part of the city of Springfield, Missouri. Said property fronting on the north side of Commercial street thirty-six feet and six inches, running back one hundred feet to the railroad right of way; and, whereas, there is a deed of trust in the nature of a mortgage on said property executed heretofore, to-wit, on the twelfth day of December, 1894, by George P. Miller to James Bray, in trust to secure a note to George Lawrence, therein described, for the sum of four thousand ($ 4,000) dollars, bearing interest at the rate of eight per cent (8) per annum from date; and, whereas, said property is about to be sold in foreclosure of said deed of trust; and, whereas, the said John Coombs is desirous of having said sale postponed and obtaining a further extension for the payment of said note; and, whereas the said Sims has agreed to purchase said note from the said Lawrence and extend the time of payment thereon for five years from this date.

"Now, therefore, in consideration of the said Sims purchasing said note and extending the time of payment thereof as aforesaid, he the said John Coombs, does by these presents agree to pay to the said Sims or his assigns the said note above described, together with all interest accruing thereon, it being further understood and agreed by the parties hereto that his agreement is in nowise to affect the validity of the said deed of trust, but the same is to continue in full force and effect as further security to the said Sims by reason of the purchase of said note, and if said Coombs shall fail to promptly pay interest, and otherwise keep his covenants herein, the said Sims may proceed to foreclose said deed of trust at any time.

"Witness my hand and seal this fifteenth day of January, 1897.

"J. W. COOMBS,

"HELEN COOMBS."

Defendant purchased and took an assignment of the note and deed of trust. The property was kept fully insured against loss by fire, for the benefit of the holder of the deed of trust, but was not insured against loss by cyclone. Sims seems to have overlooked the covenant in the deed of trust to keep the property insured against loss by cyclone, and the president and general manager of plaintiff (a corporation) testified he was ignorant of this provision in the deed of trust, although the deed was of record; that his attention was never called to it and cyclone insurance was never requested of him by Sims; that he would have taken out such insurance if Sims had called his attention to it; and defendant testified he would have demanded such insurance, if it had not escaped his attention.

It will be observed that in the deed to Helen Coombs, she assumed the payment of the deed of trust. Her husband also, by his contract for an extension of the time of payment, agreed to pay the note. It should be noted here that the contract of Sims to extend the time of payment of the note for five years, if valid and binding, inured to the benefit of plaintiff. The foreclosure sale made on July 30, 1900, was before the expiration of the period of extension, therefore, it was unauthorized and voidable. The action is at law to recover damages alleged to have accrued to plaintiff for the premature and wrongful sale of the property. The petition was held to be sufficient by the Supreme Court in Missouri Real Estate Syndicate v. Sims, 179 Mo. 679, 78 S.W. 1006. In substance, the answer alleged the sale was in strict compliance with the terms and covenants of the trust deed. Plaintiff, over the objection of defendant, offered evidence tending to show the value of the property. Defendant, in rebuttal, offered evidence for the same purpose. Both parties offered evidence of the amount the property yielded in rents per annum, and of the amount of the yearly taxes assessed against the property, and the cost of keeping it insured against loss by fire. The excuse given by defendant for having property sold under the deed of trust, prior to the expiration of the time to which payment had been extended was that plaintiff took, as he put it, "Coombs' place" and should assume the payment of the four thousand dollars note, but would not sign the Coombs contract. Defendant's idea seems to have been that by selling the property to plaintiff, Coombs was released from his undertaking to pay the note and it was plaintiff's duty to step into Coombs' shoes by taking upon itself the personal obligation of paying the note.

Defendant offered an instruction in the nature of a demurrer to the evidence, and also the following, both of which the court refused:

"3. The court instructs the jury that defendant was entitled to the possession of said premises on the fifteenth day of January, 1902, at the maturity of said $ 4,000 note as extended by said defendant in his contract therefor with Coombs, and the damage that plaintiff can recover on the first count of his petition is the net value of the profits arising from rent of said building from the thirtieth day of July, 1900, the date of said deed of Trustee Bray to the defendant, until the said fifteenth day of January, 1902. The net value of the rents as mentioned above is the amount of rents received during that period, less the taxes, insurance...