Pierpoint v. Prudential Ins. Co. of America

• Decision Date: 04 January 1943
• Docket Number: 38092
• Parties: Fannie B. Pierpoint, Administratrix of the Estate of James E. Pierpoint, Sr., v. The Prudential Insurance Company of America, a Corporation; O. M. Krueger, John R. Masters, and Carrie Masters, His Wife; J. E. Pierpoint, Jr., and Helen Powell, Appellants
• Court: Missouri Supreme Court

167 S.W.2d 64

350 Mo. 629

Fannie B. Pierpoint, Administratrix of the Estate of James E. Pierpoint, Sr., v. The Prudential Insurance Company of America, a Corporation; O. M. Krueger, John R. Masters, and Carrie Masters, His Wife; J. E. Pierpoint, Jr., and Helen Powell, Appellants

No. 38092

Supreme Court of Missouri

January 4, 1943

Appeal from Harrison Circuit Court; Hon. V. C. Rose, Judge.

Reversed.

A F. Harvey for appellants.

(1) The possession of a promissory note payable to order and duly endorsed by the payee is prima facie evidence of title in the holder, and therefore authorizes the maker to pay it without further inquiry touching the title. Brown v Worthington, 162 Mo.App. 508; Dawson v Wombles, 123 Mo.App. 340; Cox v. Sloan, 158 Mo 411; Ginter v. Commerce Trust Co., 14 S.W.2d 41; Credit Alliance Corp. v. Bryan, 27 S.W.2d 441; Chandler v. Hedrick, 187 Mo.App. 664. (2) The very purpose of the records in the recorder's office is to give notice, and the absence of notice, all parties dealing with the record have a right to rely thereon, and the absence of actual notice or knowledge of such facts as would put an ordinarily prudent person on inquiry, which only applies to prior unrecorded conveyances. Harrison v. Moore, 199 S.W. 188; Ladd v. Anderson, 133 Mo. 625. (3) Estoppel exists where a party has led another into the belief of a certain state of facts by conduct of culpable negligence calculated to have that result and the other party has acted upon such belief to his prejudice. That is, if the plaintiff, Fannie B. Pierpoint, turned over the possession of the nine thousand dollar note in question, with written endorsement thereon of James E. Pierpoint to whom the note was originally given, to James Everett Pierpoint, Jr., and thereby clothed him with all the indicia of ownership, and he accepted the sum of five thousand dollars for the mortgage and cancelled the same by making a release therefor and delivering it to John Masters and his wife, she is now estopped to claim or assert to the contrary and is bound thereby. Scott v. First Natl. Bank of St. Louis, 119 S.W.2d 929; Ginter v. Commerce Trust Co., 14 S.W.2d 41; Edmonson v. Waterston, 119 S.W.2d 318; Baade v. Cramer, 213 S.W. 121; Neuhoff v. O'Reilly, 93 Mo. 164; Lee v. Turner, 89 Mo. 489; Miller v. People's Savs. Bank, 193 Mo.App. 498; Goddard Grocer Co. v. Freedman, 127 S.W.2d 759; Klebba v. Struemph, 23 S.W.2d 205; M. M. Securities Co. v. General Motors Acceptance Corp., 76 S.W.2d 521. (4) The written endorsement of a promissory note by James E. Pierpoint, Sr., to James E. Pierpoint, Jr., is an admission against interest. Brown v. Holman, 238 S.W. 1065; Willis v. Berberich's Delivery Co., 98 S.W.2d 569; Boynton v. Miller, 144 Mo. 681; Wynn v. Cory, 48 Mo. 346; Nelson v. Nelson, 90 Mo. 460; Waddell v. Waddell, 87 Mo.App. 216; 4 Encyclopedia of Evidence, p. 87. (5) The following authorities justify the finding of the court that, even though the note and deed of trust in question were found after the death of James E. Pierpoint, Sr., among his papers, yet, there had been a sufficient delivery of the note and deed of trust to vest the title thereto in James E. Pierpoint, Jr., when you consider the endorsement to him of the original eight thousand dollar note and the statement against interest made by James E. Pierpoint, Sr., together with the fact that this was treated as a family matter and a family settlement on the son. Crutcher v. Stewart, 204 S.W. 18; Mason v. Mason, 231 S.W. 971; Gillespie v. Gillespie, 289 S.W. 579; Schooler v. Schooler, 258 Mo. 83; Harvey v. Long, 260 Mo. 375; Rausch v. Michel, 192 Mo. 293; Shanklin v. McCracken, 151 Mo. 587; Rumsey v. Otis, 133 Mo. 85; Dickson v. Dickson, 101 S.W.2d 774; Kirby v. Bank of Dearborn, 19 S.W.2d 1043. (6) When Fannie Pierpoint, the administratrix consented to the delivery of this note and deed of trust to James E. Pierpoint, Jr., she had in her possession properly assigned to her all the remainder of said estate of James E. Pierpoint, Sr., save only the real estate. The court by its refusal of letters has vested the title to all said property in her, she is bound by her acts and cannot take and receive the property and repudiate the balance of the transaction. (7) The assignment to James E. Pierpoint, Jr., of the original eight thousand dollar ($ 8,000) note and the endorsement of it by James E. Pierpoint, Jr., shows conclusively that it had been delivered by the father to the son, otherwise he could not have made an endorsement of it. (8) Neither the insurance company, Helen Powell, James E. Pierpoint, Jr., John R. Masters, nor Carrie Masters had any knowledge or information sufficient to put them or any of them on inquiry, that the plaintiff, Fannie B. Pierpoint, was claiming or intended to assert that James E. Pierpoint, Jr., did not have the right to settle the note for five thousand dollars, which was a valuable consideration and make full release of the mortgage, which he did. Bristow v. Thackston, 187 Mo. 332; Wetmore v. Woods, 62 Mo.App. 265; Arnholt v. Hartwig, 73 Mo. 485; Greenlee v. Marquis, 49 Mo.App. 290; Goddard Grocer Co. v. Freedman, 127 S.W.2d 759. (9) Possession and ownership of a promissory note once proved to exist are presumed to continue until the contrary is shown by evidence. This is applicable to the original ownership of the eight thousand dollar note. Janssen & Freyschlag v. Stone, 60 Mo.App. 402. (10) If any mistake was made in releasing this nine thousand dollar deed of trust and filing said release in the office of the recorder of deeds, it was a mistake of law and not of fact, therefore the plaintiff, Fannie B. Pierpoint, has no right to relief. Norton v. Highleyman, 88 Mo. 621; Breit v. Bowland, 100 S.W.2d 599; State ex rel. Breit v. Shain, 119 S.W.2d 758.

Wright & Ford, W. F. Wilkinson and W. Raleigh Gough for appellant, The Prudential Insurance Company of America.

(1) Subject only to claims of creditors, the son and widow of Dr Pierpoint became the equitable owners of his entire estate, without the necessity of administration. Richardson v. Cole, 160 Mo. 372, 61 S.W. 182, 83 Am. St. Rep. 479; Johnston v. Johnston, 173 Mo. 91, 73 S.W. 202, 61 L. R. A. 166; Mahoney v. Nevins, 190 Mo. 360, 88 S.W. 731; McCracken v. McCaslin, 50 Mo.App. 85; Griesel v. Jones, 123 Mo.App. 45, 99 S.W. 769; In re Landgraf's Estate, 183 Mo.App. 251, 168 S.W. 268; Bell v. Farmers & Traders Bank, 188 Mo.App. 383, 174 S.W. 196. (2) Upon refusal of administration, the widow became the absolute owner of all property in the estate, subject only to the contingency that creditors "or other parties interested" might secure administration upon assets over and above the absolute property of the widow. Sec. 2, R. S. 1939; Parsons v. Harvey, 195 S.W. 531; Same Case, 281 Mo. 413, 221 S.W. 21. (3) J. E. Pierpoint, Jr.'s, possession of the note, with a regular endorsement thereon to him, constituted him the legal "holder" of the note and "assignee" with power to make a valid release of the mortgage. Secs. 3032, 3103, 3134, 3209, 3465, R. S. 1939; 10 C. J. S. 994, sec. 454; Alexander v. Rollins, 14 Mo.App. 109; Same Case, 84 Mo. 657; Lee v. Turner, 89 Mo. 489. (4) Payment of the note having been made to the "holder" thereof and the mortgage having been regularly released of record, plaintiff cannot have the mortgage reinstated and declared a prior lien to the mortgage held by the Prudential, unless she shows that the Prudential acted in bad faith or had knowledge of the alleged invalidity of the release or of sufficient facts to put it on an inquiry which would have led to such knowledge. 41 C. J. 585-589; Crecelius v. Home Heights Co., 217 S.W. 508; Sweet v. Leffel, 215 S.W. 908; Bristow v. Thackston, 187 Mo. 332, 86 S.W. 94, 106 Am. St. Rep. 472; Wilkins v. Fehrenback, 180 S.W. 22; Edmonson v. Waterston, 342 Mo. 1082, 119 S.W.2d 318. (5) The burden of proof was upon plaintiff to show that the Prudential was not an innocent purchaser. McCloskey v. Koplar, 329 Mo. 527, 46 S.W.2d 557, 92 A. L. R. 641; Schaefer v. St. Louis & Suburban Ry. Co., 128 Mo. 64, 30 S.W. 331; 31 C. J. S., pp. 710-715, sec. 104; Tower Grove Bank & Trust Co. v. Duing, 346 Mo. 896, 144 S.W.2d 69; State ex rel. Strohfield v. Cox, 325 Mo. 901, 30 S.W.2d 462; Griffith v. Continental Cas. Co., 299 Mo. 426, 253 S.W. 1043; Downs v. Horton, 287 Mo. 414, 230 S.W. 103; Clapper v. Lakin, 343 Mo. 710, 123 S.W.2d 27; Harrison v. Moore, 199 S.W. 188; Anderson v. Cole, 234 Mo. 1, 136 S.W. 395; Beach v. Lynn, 299 Mo. 127, 252 S.W. 437; State ex rel. Robertson v. Hope, 102 Mo. 410, 14 S.W. 985; Wall v. Beedy, 161 Mo. 625, 61 S.W. 864; Emlet v. Gillis, 63 S.W.2d 12; Bank v. Worthington, 145 Mo. 91, 46 S.W. 745. (6) There was no evidence of lack of good faith on the part of the Prudential and no evidence of notice to it of any suspicious facts. Goddard Grocer Co. v. Freedman, 127 S.W.2d 759. (7) The evidence shows that the Masters were innocent purchasers, hence the Prudential's lien is prior to plaintiff's lien. Hendricks v. Calloway, 211 Mo. 536, 111 S.W. 60; Bradford v. Davis, 219 S.W. 617; Fowles v. Bentley, 135 Mo.App. 417, 115 S.W. 1090; Hellweg v. Bush, 228 Mo.App. 876, 74 S.W.2d 89. (8) Plaintiff's negligence bars a recovery on her part against the Prudential. Edmonson v. Waterston, 342 Mo. 1082, 119 S.W.2d 318; Goddard Grocer Co. v. Freedman, 127 S.W.2d 759; Ava Hardware Co. v. Christensen, 122 S.W.2d 92; Kuraner v. Columbia Natl. Bank of K. C., 230 Mo.App. 358, 90 S.W.2d 465; M. & M. Securities Co. v. Gen. Motors Accep. Corp., 230 Mo.App. 900, 79 S.W.2d 521; Baade v. Cramer, 278 Mo. 516, 213 S.W. 121; Leonard v. Shale, 266 Mo. 123, 181 S.W. 16; Walters v. Tielkemeyer, 72 Mo.App. 371; Hannibal Inv. Co. v. Schmidt, 113 S.W.2d 1048; Tower Grove Bank & Trust Co. v. Duing, 346 Mo....