Morrison's Ex'r v. Caldwell

• Decision Date: 04 October 1827
• Citation: 21 Ky. 426
• Parties: Morrison's Ex'or. and Devisee v. Caldwell.
• Court: Kentucky Court of Appeals

21 Ky. 426

Morrison's Ex'or. and Devisee v. Caldwell.

Court of Appeals of Kentucky.

October 4, 1827

Dates. Conveyances. Vendor and Vendee. Notice. Fraud. Trustees. Estoppel. Compensation. Rescission of Contracts. Corporations.

APPEAL FROM THE FAYETTE CIRCUIT; JESSE BLEDSOE, JUDGE.

Crittenden Chinn and Wickliffe, for appellants.

Haggin and Loughborough, for appellee.

OPINION

MILLS JUDGE.

David and Levi M'Murtry being seized in fee of a tract of land containing about sixty-five acres, in the year 1810 contracted by parol only, to sell it to Lewis Sanders, who paid them part of the price. But the whole price was not paid till the 27th of June, 1815, when they sealed and acknowledged a conveyance for the same, which was duly recorded forthwith. The deed bears date on its face, on the 28th of November, 1814, but the acknowledgment, 27th June 1815, when as is contended by the complainants in this controversy, it was first signed, sealed and delivered, and parol proof is adduced, to show that such was the fact.

Sale and conveyance of the land, by the McMurtries to Lewis Sanders.

Sanders, to secure sundry debts due to the late Kentucky Insurance Company, conveyed a part of the same land, together with an adjoining piece, to James Haggin and Thomas T. Crittenden, in trust, to secure the payment of these debts, with a full power to sell in default of payment. This conveyance, in the body of it, bears date on the 16th February, 1814, and concludes thus: " In testimony whereof, the parties have hereunto set their hands and affixed their seals, this 16th day of February, 1815," and then follows the seals and signatures of the parties. On the 28th of March, 1815, this deed was duly acknowledged and recorded in the proper office.

Sanders' conveyances of a part of the land, in trust, to secure the payment of his debts to the Insurance Company.

On the 15th of June, 1815, Sanders, to secure sundry debts, due by him to the Bank of Kentucky, conveyed sundry tracts of land to said Bank, and among the rest, the aforesaid tract conveyed to him by M'Murtry, and interfering with and extending into the first aforesaid tract, conveyed to the Insurance Company, to the extent of about thirty acres, and this collision between these two deeds has given rise to the present controversy, as that interference is the matter of dispute. This deed to the Bank of Kentucky, was not acknowledged and recorded till the 29th of October, 1817, upwards of two years after its date.

Sanders' conveyance to secure his debt to the Bank of Kentucky.

From this clashing of conveyances arose two different claimants from the two banks down to the present parties. Haggin and Crittenden, the trustees for the Insurance Company, sold and conveyed to James Prentiss, by deed dated the 24th of November, 1817; Prentiss conveyed in trust to Pearson, Scott and January; who sold and conveyed to James Morrison, who devised the tract to Robert Scott, who is a defendant in this suit.

Scott, Morrison's devisee's claim, derived under the conveyance, for the benefit of the insurance company.

On the other hand, the Bank of Kentucky, proceeded to foreclose her mortgage, on all the large estate conveyed to her by Sanders, including this thirty acres among the rest; and sold it and became herself the purchaser. But this sale did not nearly discharge the debt of Sanders to the bank, and there were a number of collateral sureties bound to the bank for the debt of Sanders, who were much dissatisfied with this sale of the bank under its mortgage, and who prevailed with the bank, again to set up the same estate at auction, in order that they might attend to the sale, and cause it to bring a better price, they engaging to make up and pay the deficit, as Sanders had failed. In the meantime, executions of others had been levied on this estate, so conveyed to the Bank of Kentucky, and the estate had been sold thereby, and James Haggin had become the purchaser of part, and James Cowan of another part, to whom the sheriff conveyed. This title was supposed to be dangerous to the title of the Bank of Kentucky, because the mortgage to the bank from Sanders, had not been recorded in time, whereby the estate was believed to be liable to the judgments and executions of creditors. In order to obviate this difficulty, and to cause the estate in this second sale to bring as much as possible, by removing incumbrances, it was agreed between the bank and these collateral sureties, that the bank should purchase in the title of Haggin and Cowan, acquired by the sheriff's sale, before the estate was re-sold. This was accordingly done, and the Bank of Kentucky again set up the estate, for the benefit of these sureties, at auction. At this sale, Caldwell, the present complainant, became the purchaser of a tract, which included this thirty acres, the matter of controversy, then claimed and held in the possession of Morrison. Caldwell accordingly gave bond with surety to the bank for the purchase money, and received a conveyance.

Caldwell's claim derived under the deed of trust, to secure his debt to the Bank of Kentucky.

Caldwell then filed this bill, making the Bank of Kentucky, and Morrison, in his lifetime, defendants; complaining, first against the bank, that the conveyance which they had given him was not valid, because it was made by an agent of the bank, and had not the corporate seal affixed thereto; that it did not contain such clauses of general warranty as it ought to have done under the terms of sale, and that the bank had never given him possession, but Morrison still held possession of this thirty acres. As against Morrison, he alleges that the conveyance from M'Murtry to Sanders, was antedated, and that Sanders of course had no title when he conveyed to the Insurance Company, under which he held, and of course that Company took no title. That the conveyance to the Insurance Company, was dated a year before it was recorded, and of course it was invalid as to creditors, and subsequent purchasers without notice, and that the Bank of Kentucky, under which he claimed, was such purchaser without notice. Or if the Bank of Kentucky got no title, and her conveyance was not recorded in time, then the executions of the other creditors took the estate, and Haggin, the purchaser, under them, acquired a good title, and the Bank of Kentucky having acquired this title before his purchase, of course their title was superior to Morrison's. He prays that the bank may complete his title, by making it as it ought to be, and that Morrison may be compelled to release his title, and to surrender the possession and account for the rents and profits, or if this prayer should not be granted, that he may have relief granted him against the bank to the extent of the purchase money for the thirty acres.

Allegations of Caldwell's bill against the Bank of Kentucky and Morrison.

The bank answered, alleging that the conveyance received by the complainant, was received by him without objection, and his notes given for the purchase money; that they were however willing to make him a conveyance with the seal properly annexed, if it was not already done, so soon as he would present to them a proper deed. They deny that they were to make any warranty by the terms of sale, but only to convey their title. That they were not to deliver possession, that the complainant knew of Morrison's title; before he purchased, as Morrison proclaimed it at the sale, and particularly advised the complainant not to buy the thirty acres, as he, Morrison would contend for it. That the sale was not for their benefit, nor were they interested in it, but that it was merely for the benefit of the collateral sureties of Sanders.

Answer of the Bank of Kentucky.

Morrison having departed this life, his executor and devisee responded to the suit. The executor alone answered the original bill, setting forth the title of the testator as we have already recited it. He denies any fraud in the deed from Sanders to the Insurance Company, and insists that the last date at the bottom is the true date; that the date in the body of the conveyance, was owing to the conveyance having been prepared before it was executed, or by a mistake of the writer who had put in the old year, instead of the new, as frequently happened at the commencement of a new year, as this date was, and that the date at the bottom is the proper corrective. He insists that it is incompetent for Sanders or the M'Murtries, or any person claiming under them, to contradict or disprove the date of the conveyance from M'Murtries to Sanders, as the conveyance was recorded in due time; or if it is, that there was the same absence of title in Sanders, when he conveyed to the Bank of Kentucky, that there was when he conveyed to the Insurance Company, and that as the former was not recorded in due time, Morrison had the superior equity; and that the conveyance of M'Murtry when made, enured to the benefit of the trustees of the Insurance Company, and therefore, Haggin could not acquire title by the sheriff's deed.

Answer of Morrison.

The complainant then filed an amended bill setting up additional and new equity against the title of Morrison. He charges that Morrison was one of the collateral sureties for Saunders, and was party to the arrangement and agreement made between said sureties and the bank, in pursuance of which, the estate mortgaged by Saunders to the bank, was brought into a market a second time. That that agreement was in writing, and signed by Morrison for himself and by James Haggin for the other sureties, and is to this effect:

Caldwell's amended bill.

It is agreed between the Bank of Kentucky and James Morrison, and others, collateral securities for Lewis Sanders, as...