Murto v. Lemon

• Decision Date: 09 November 1903
• Parties: MURTO v. LEMON et al. [*]
• Court: Colorado Court of Appeals

75 P. 160

19 Colo.App. 314

MURTO v. LEMON et al. ^[*]

Court of Appeals of Colorado

November 9, 1903

Error to District Court, Otero County.

Action by Dennis Murto, as administrator to collect the estate of Samuel Turbutt, deceased, against Laura J. Lemon and others. There was a judgment for plaintiff, in which, however, the court declined cancellation of a release deed and foreclosure of a trust deed, and plaintiff brings error to review that part of the judgment. Reversed.of property covered by a deed of trust are charged with notice of the conditions upon which the trustee is authorized to release the deed of trust.

Dan. B. Carey and Thomas H. Hardcastle, for plaintiff in error.

O.G Hess, for defendants in error.

GUNTER J.

May 2 1891, Laura J. Lemon and her husband, Thomas J. Lemon, gave their promissory note, due five years after date, and ten interest notes, maturing semi-annually (the Colorado Securities Company, payee), and, as security therefor, a trust deed (usual form; same date; Aldrich, trustee; recorded May 7, 1891) upon real estate in Otero county, Colo. The trustee was authorized by the trust deed to release the same upon payment of the notes secured thereby. This deed described the notes, disclosing that the principal note matured five years after date. By undated indorsements of the payee, the principal note and five of the interest notes were transferred to Samuel Turbutt. November 26, 1892 (recorded same date), Aldrich, as trustee, executed what purported to be a release deed discharging the trust deed. December 10, 1892, Laura J. Lemon, the owner of the land covered by the trust deed, conveyed a part thereof by warranty deed (recorded same date) to defendant in error Simpson. In December, 1895, she conveyed, by deed recorded December 3, 1895, the remainder of the land so incumbered to defendant in error King. This action was brought April 22 1898, by Turbutt, upon the principal note and the five interest notes, against defendants in error, for the purpose of obtaining a personal judgment against Laura J. Lemon, the cancellation of the release deed, and the foreclosure of the trust deed. Turbutt having died pending the action, plaintiff in error was substituted. Trial to the court resulted in a judgment in favor of plaintiff in error and against Laura J Lemon upon the principal note and interest notes. The court, however, declined cancellation of the release deed and foreclosure of the trust deed. From such ruling is this proceeding on error.

Plaintiff in error, in making out his case below, introduced the principal note, the five interest notes, the trust deed, and rested.

The notes, with the indorsements thereon, presumptively established ownership in plaintiff in error and nonpayment. Gumaer v. Sowers (Colo.Sup.) 71 P. 1103; 22 Am. & Eng.Ency. of Law (2d Ed.) 588. As the indorsements were undated, until the contrary appeared they took the date of the notes. "A note purporting to have the indorsement of the name of the payee, with no indication of any time when it was made, independent of the date of the note, is presumed to have been indorsed on that day, because that date will apply to everything written upon the same paper." Parker v. Tuttle, 41 Me. 349, 351. "And in the absence of evidence to the contrary, an indorsement or transfer will be deemed to have been made at the time and place of execution." 4 Am. & Eng.Ency. of Law (2d Ed.) 319, and authorities cited. This presumption obtains in an action by an indorsee against the maker of the note; also against the maker of the trust deed securing it, in a proceeding to foreclose. "The note and mortgage are inseparable; the former as essential, the latter as an incident." Carpenter v. Longan, 16 Wall. 271, 274, 21 L.Ed. 313. We see no reason for denying the application of this presumption as to the date of the indorsement as against defendants King and Simpson, who, in this proceeding to foreclose the trust deed, are attempting to defeat it by the alleged release. The introduction of the trust deed raised the presumption that it had not been discharged. "A contract obligation shown to have existed at one time will be presumed to continue until its discharge is shown. Thus is an indebtedness shown to have existed presumed to continue." 22 Am. & Eng.Ency. of Law (2d Ed.) 1243. "The onus was on the defendant, for the reason that, when a contract is once made between parties, it binds and is legally presumed to subsist until it be shown to have been performed or rescinded." Love v. Edmonston, 27 N.C. 354.

The introduction of the indorsed notes presumptively established their nonpayment, and their assignment to Turbutt on the date when made;...