Morrison v. Painter
| Citation | 170 S.W.2d 965 |
| Decision Date | 04 May 1943 |
| Docket Number | No. 26331.,26331. |
| Parties | MORRISON v. PAINTER et al. |
| Court | Court of Appeal of Missouri (US) |
Appeal from St. Louis Circuit Court; Robert L. Aronson, Judge.
"Not to be reported in State Reports."
Action by Frances C. Morrison against Leo B. Painter and another on notes, wherein a cross-bill was filed. Judgment for plaintiff, and defendants appeal.
Affirmed.
John A. Nolan, of Clayton, and Stanley A. Sidmon, of St. Louis, for appellants.
Richard T. Brownrigg, of St. Louis, for respondent.
This suit was brought by respondent, as plaintiff, against appellants, as defendants, to recover on one principal promissory note in the sum of $2,000 and six interest notes in the sum of $50 each. After each of the defendants had filed an amended separate answer, plaintiff ultimately filed two separate amended motions for judgment on the pleadings, which the court thereafter sustained and rendered judgment in favor of plaintiff and against both defendants on all seven counts of the petition for a total sum of $3,420, and against defendant Rose E. Painter on her cross bill. Defendants duly appealed.
Plaintiff's petition was in seven counts. The first count declared on the principal note for $2,000, alleging that defendants, for value received, executed and delivered to plaintiff said note dated July 15, 1932, which, by its terms, became due and payable three years after the date thereof, and also obligated defendants to pay plaintiff eight per cent. interest per annum after maturity.
Each of the remaining six counts of plaintiff's petition was based upon an interest note in the sum of $50, dated July 15, 1932, payable, respectively, six, twelve, eighteen, twenty-four, thirty, and thirty-six months after date.
Defendants contend that their amended separate answers pleaded that the notes had been wholly without consideration and had been executed for the accommodation of plaintiff; that these were allegations of fact and not conclusions; that allegations in the answers made sharp issues of fact, and that, for the purpose of considering the motion for judgment on the pleadings, the truth of such allegations was admitted and constituted a complete defense to the notes sued upon; that therefore, the court erred in rendering judgment for plaintiff.
The contentions of defendants make it necessary for us to analyze the amended separate answers. Each answer admits the execution and delivery by the defendants of the notes involved, and alleges that they were executed "wholly without consideration"; that they were executed and delivered at the request of plaintiff "wholly for the purpose of lending the names of the defendants to plaintiff, and for plaintiff's accommodation only." The answers then allege that on or about July 14, 1935, and for several years prior thereto, one Ben W. Dalzell was the owner and in actual possession of certain real estate at 4252 Washington Boulevard in St. Louis, Missouri, on which was an apartment building; that on May 20, 1926, said real estate was encumbered by deeds of trust securing an indebtedness aggregating $7,200, together with various interest notes, all of which indebtedness was to become due on July 17, 1926; that on May 20, 1926, said Dalzell was indebted to defendant Leo B. Painter in the sum of $1,000, and at said time Dalzell was unable to procure funds with which to pay Leo B. Painter said sum of $1,000, or to pay said indebtedness evidenced by said notes and deeds of trust so to become due on said July 17, 1926, and that the foreclosure and sale of said property was impending.
The amended separate answers further allege that on or about May 20, 1926, defendant Leo B. Painter and said Dalzell, in order to salvage said property from such foreclosure and sale, entered into an agreement whereby defendant Leo B. Painter was to procure a loan on said property in an amount sufficient to satisfy the indebtedness secured by said notes and deeds of trust, and for such purpose to accept and hold the legal title to said property as the straw party and agent of said Dalzell for the purpose of executing encumbrance thereon, and to continue to hold said title for the purpose of refinancing same and to assist said Dalzell in making sale of said property, in which event to execute conveyance thereof subject to any encumbrance thereon at time of sale, and in the event the sale price of said property exceeded the amount of the encumbrance thereon, said defendant was to be paid out of such excess said sum of $1,000, so owing to him from said Dalzell, together with any other sum or amounts advanced or paid by said defendant in connection with said property; that on May 20, 1926, in pursuance of said agreement, Dalzell caused the title to said property to be conveyed to said defendant.
The answers then further allege that on July 17, 1926, defendant Leo B. Painter, acting as such straw party and agent, negotiated a loan in the sum of $8,000, and together with defendant Rose E. Painter, his wife, executed a principal note for said amount due three years after its date, and also executed semi-annual interest notes, all of which were secured by a deed of trust on said property executed by both defendants; that out of the proceeds of said loan, so procured, defendant Leo B. Painter paid off and satisfied the indebtedness evidenced by the former notes and deeds of trust mentioned.
The answers then allege that between May 20, 1926, and July 15, 1932, defendant Leo B. Painter, acting as straw party and agent for said Dalzell, and at his request, negotiated and procured various loans on said property, to secure which encumbrances on said property were executed by both defendants, and that from time to time said defendant advanced and paid out for said Dalzell, in connection with said property, various sums of money which, after deducting credits thereon, amounted to $2,593.56.
At this point in the amended separate answers it is alleged that in 1926 plaintiff, Frances C. Morrison, and said Dalzell jointly engaged in the conduct of a rooming house at said premises and continued to transact said business and to reside there until February, 1933; that on July 15, 1932, said property was subject to a deed of trust securing indebtedness in the sum of $8,000, which deed of trust and notes secured thereby were executed by both defendants Leo B. Painter and Rose E. Painter; that the holder of the $8,000 note was demanding that a payment of $2,000 should be made, reducing the debt to $6,000, in which event payment of the $6,000 would be extended for three years; that if such payment was not made, said deed of trust would be foreclosed and the property sold; that on or about July 15, 1932, for the purpose of preventing the sale of said property, said Dalzell negotiated with and procured from plaintiff a loan in the sum of $2,000, for which sum both defendants executed and delivered their note to plaintiff with interest notes, and both defendants executed a second deed of trust on the property to secure the payment of said notes; that said $2,000 was turned over to defendant Leo B. Painter and was paid by him to the holder of the $8,000 note and was credited thereon, and the payment of said note in the reduced sum of $6,000 was extended for three years; that plaintiff well knew that Dalzell was the exclusive owner of said premises and well knew that defendant Leo B. Painter was only the straw party and agent of said Dalzell in connection therewith, and well knew that the $2,000 advanced by plaintiff was for the use and benefit of said Dalzell as principal, and that defendant Leo B. Painter derived no interest in or benefit therefrom.
The amended separate answer of defendant Rose E. Painter contained additional allegations to the effect that she was the lawful wife of defendant Leo B. Painter; that by mutual mistake of all the parties to the instruments mentioned, she was procured to execute said notes and deed of trust for the sole and only purpose of barring and encumbering her apparent right of dower in said property, when in truth and in fact said property, the legal title to which was so held by said defendant Leo B. Painter, as straw party and agent for Dalzell, constituted and was the subject of an implied trust, and that she, Rose E. Painter, had no dower whatever or other interest therein, but was at said time without knowledge or information respecting her status therein. Said defendant prayed that as to her all the notes be canceled, set aside, and for naught held.
Reduced to the material determinative facts, the amended separate answers of defendants show that the title to the property involved was, on July 15, 1932, the date of the execution and delivery of the notes, held by defendant Leo B. Painter, and that title had been in him since July 20, 1926; that there was a deed of trust on the property which had been executed by both defendants as joint makers to secure a note for $8,000, which also had been signed by both defendants and on which both were liable. Dalzell procured a loan from plaintiff in the sum of $2,000 and both defendants executed the principal note in suit for $2,000, as well as the six interest notes, which were delivered to plaintiff, and both defendants executed a deed of trust upon the property to secure the payment of all said notes. The $2,000 thus procured from plaintiff, according to the answers, was turned over to defendant Leo B. Painter and was paid by him to the holder of the $8,000 note, which was then on the property and which had been executed by both defendants. Said payment of $2,000 reduced the $8,000 indebtedness, for which defendants were liable, to $6,000, and the loan for the last named amount was extended for three years. The answers then allege that before the execution of the $2,000 note by the defendants, plaintiff well knew that Dalzell...
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