Norment Et Ux. v. Turley

• Decision Date: 27 August 1918
• Docket Number: No. 2102.,2102.
• Citation: Norment v. Turley, 24 N.M. 526, 174 P. 999, 1918 NMSC 109 (N.M. 1918)
• Parties: NORMENT et ux.v.TURLEY et al.
• Court: New Mexico Supreme Court

24 N.M. 526

174 P. 999

NORMENT et ux.

v.TURLEY et al.

No. 2102.

Supreme Court of New Mexico.

Aug. 27, 1918.

Syllabus by the Court.

Prior stipulations are merged in the final and formal contract executed by the parties, and this rule applies to a deed or mortgage based upon a contract to convey.When a deed is delivered and accepted as performance of the contract to convey, the contract is merged in the deed.Though the terms of the deed may vary from those contained in the contract, the deed alone must be looked to, to determine the rights of the parties.

There is an exception to the rule stated, which is that the contract of conveyance is not merged upon execution of a deed, where under the contract the rights are conferred collaterally and independent of the deed; there being no presumption that the party, in accepting the deed, intends to give up the covenants of which the deed is not a performance or satisfaction.Where the right claimed under the contract would vary, change, or alter the agreement in the deed itself, or inheres in the very subject-matter with which the deed deals, a prior contract covering the same subject-matter cannot be shown, as against the provisions of the deed.

Appeal from District Court, Santa Fé County; Abbott, Judge.

Action by James W. Norment and wife against Urna B. Turley and husband.Judgment for plaintiffs, and defendants appeal.Affirmed.

There is an exception to the rule stated, which is that the contract of conveyance is not merged upon execution of a deed, where under the contract the rights are conferred collaterally and independent of the deed; there being no presumption that the party, in accepting the deed, intends to give up the covenants of which the deed is not a performance or satisfaction.Where the right claimed under the contract would vary, change, or alter the agreement in the deed itself, or inheres in the very subject-matter with which the deed deals, a prior contract covering the same subject-matter cannot be shown, as against the provisions of the deed.

Frank W. Clancy, of State Fé, for appellants.

J. H. Crist, of Santa Fé, for appellees.

ROBERTS, J.

This action was instituted in the court below by appellees to foreclose the lien of a deed of trust upon certain property in the city of Santa Fé.The trust deed was in the ordinary form, and was made to secure the payment of three promissory notes-one for $2,000, due one year from date thereof, and the other two notes each, respectively, for $4,500, due two and three years after date.The trust deed contained the usual stipulations providing for the right of foreclosure in the event of a failure to pay either note when due, or interest, or taxes, etc.The complaint alleged breach of the conditions of the trust deed, in that appellants had failed and refused to pay the principal of the first note falling due and to pay the taxes and insurance premiums.The answer filed by appellants admitted the failure to make the payments stated, but justified such failure upon the ground that on the 12th day of January, 1916, the parties to the litigation, Norment and wife on the one side, and Urna B. Turley and her husband, appellants, on the other, entered into a contract for the exchange of certain real estate belonging to the respective parties; the first paragraph of the contract being as follows:

“First.The said Norments hereby obligate themselves to make and deliver to the said Turleys, or either of them, a warranty deed to their apartment house property on Washington avenue, in said city, and of all the contiguous and connected lands therewith belonging to the said Norments, for a total consideration of twenty-two thousand and five hundred ($22,500) dollars, which is to be paid as is stipulated in second paragraph hereto (out of said consideration of $22,500 the said Norments are to pay and discharge all of the present incumbrance of whatsoever kind aggregating some $8,500, so as to relieve said property of all incumbrance up to this date before principal payments are made so as to protect the said Turleys from such indebtedness), and the said Norments agree to loan the said Turleys $200 as per mutual agreement.”

The second paragraph of the contract had to do with the property the Turleys were to give in exchange for the Norment property, and provided for the execution of the notes in question and the trust deed.The fifth paragraph of the contract reads as follows:

“Fifth.It is here mutually agreed that deeds and papers in accordance herewith are to be executed and delivered forthwith-that is to say, within the next day or two-and possession of the said properties is to be accordingly yielded and taken.”

The contract was not acknowledged, but was signed by all the parties.The court, at the request of the appellants, found that the contract, notes, and trust deed were all executed on the same day.This finding as to all the parties is not supported by the evidence.Mrs. Turley, however, did sign one copy of the contract, it having been executed in duplicate, on the same day that the trust deed and the notes were executed.This finding, however, we do not regard as material, in view of other findings and the judgment entered by the court.The court, after hearing the evidence, found for the appellees, and entered judgment foreclosing the trust deed.From this judgment this appeal is prosecuted.

[1] The principal error relied upon by appellants is the failure of the court to give effect to paragraph 1 of the contract hereinbefore set out; it being appellant's contention that the contract and deeds were executed on the same day between the same parties, and should be considered as evidencing one single transaction.It...