Richter v. Noll

• Decision Date: 22 February 1901
• Citation: 128 Ala. 198,30 So. 740
• Parties: RICHTER v. NOLL ET AL. [1]
• Court: Alabama Supreme Court

30 So. 740

128 Ala. 198

RICHTER v. NOLL ET AL. ^[1]

Supreme Court of Alabama

February 22, 1901

Appeal from chancery court, Cullman county; Wm. H. Simpson Chancellor.

Action by John Adam Noll and others against William Richter. Judgment for complainants. Defendant appeals. Reversed.

This was a bill in equity, and sought to have a deed absolute on its face declared a mortgage, and to redeem. It alleged that the property conveyed, consisting of both real and personal property, was worth about $800, and that the recited consideration was $100. It further alleged that the same was intended only as a mortgage, and was executed to secure the grantee as surety upon a bail bond for the grantor; that very little, if any, indebtedness was created or became due the grantee. The other facts are stated in the opinion. There was a motion to dismiss for want of equity, and a plea of the statute of limitations of 10 years, together with an answer denying the material allegations of the bill. The cause was submitted for final decree upon the pleadings and proof, and decree rendered for the complainants.

T. M Wilhite, for appellant.

Alvin Ahlrichs, for appellees.

TYSON J.

The bill in this case was filed to have a certain deed executed by the complainants' father to the respondent declared a mortgage, and to redeem the property conveyed by it. It is well settled in this state that a court of equity has jurisdiction to entertain such a bill, and to grant the relief sought. To this end parol evidence is admissible to convert an instrument appearing on its face to be an absolute conveyance of either real or personal property into a mortgage by proof that the parties intended it to operate only as security for a debt. The ground on which a court of equity proceeds in receiving parol evidence to show an absolute conveyance to have been intended as a mortgage only is that it would be a fraud to permit the grantee to hold the property discharged of the trusts and conditions originally attached to the conveyance and which he promised to perform. 2 Brick. Dig. p. 271, §§ 316, 317. "Whenever a deed absolute on its face is thus treated as a mortgage, the parties are clothed with all rights, are subject to all the liabilities, and entitled to all the remedies of ordinary mortgagors and mortgagees. The grantee may maintain an action for the foreclosure of the grantor's equity of redemption. The grantor may maintain an action to redeem and to compel a reconveyance upon his payment of the debt secured. If the grantee goes into possession, he is in reality a mortgagee in possession, and as such is liable to account for the rents and profits." 3 Pom. Eq. Jur. § 1196. These principles, applied to the averments of the bill in this case, demonstrate the want of merit in the motion to dismiss it for want of equity predicated upon the theory that complainants had an adequate remedy at law. It is only necessary to say of the allegations of the bill in which the respondent is charged with having procured the deed by fraud, imposition, and duress that they are unsupported by the evidence. The relief granted, as shown by the decree of the chancellor, is based wholly upon the proposition that the conveyance from the complainants' father to the respondent (a deed absolute on its face) was intended merely as a security for a debt (a mortgage); and indeed, it is the only possible relief that could have been granted under the averments of the bill and the prayer. It may be well doubted whether the evidence was of such a character as that it can be said that the deed was...