Rowray v. Atlas Realty Co.
| Decision Date | 14 May 1935 |
| Docket Number | 1844 |
| Citation | 48 Wyo. 264,45 P.2d 18 |
| Parties | ROWRAY v. ATLAS REALTY COMPANY |
| Court | Wyoming Supreme Court |
ERROR to the District Court of Natrona County; C. O. BROWN, Judge.
Action by D. L. Shipp against the Atlas Realty Company, wherein Oline Rowray, as executrix and sole legatee and devisee of D L. Shipp, deceased, was substituted as plaintiff. To review a judgment for defendant, plaintiff brings error.
Affirmed.
For the plaintiff in error there was a brief by S.E. Phelps, Philip E. Winter and E. Paul Bacheller, all of Casper, and oral argument by Mr. Phelps.
There is no allegation in plaintiff's petition indicating an agency in Mr. Shipp to transact business for plaintiff, to say nothing of authorization to sign her name, without her consent. There is nothing in the answer which justifies the second special finding. Plaintiff alleges that her name was forged to the note and mortgage involved. This second defense must be regarded as an affirmative defense. 31 Cyc. 218; Bank v. Ford, 30 Wyo. 110. Affirmative matter must be specially pleaded. Section 89-1014, R. S. 1931. It is a legal obstruction to plaintiff's recovery, having in view the same result as confession and avoidance, and must be specially pleaded. Bond v. Corbett, 2 Minn. 248; Hellmuth v. Benoist, (Mo.) 129 S.W. 257. Agency was not pleaded, nor was there a special pleading of ratification. Bank v. Haun, 30 Wyo. 322. A mortgage securing a forged note is invalid. 41 C. J. 674. A third person dealing with an agent must act in good faith toward the principal. He cannot claim to have been mislead by the assumed authority of the agent. 25 C. J. 576. If Shipp and wife both knew of the forgery, there would be no occasion for a confession. A party dealing with an agent is bound to inquire as to his authority. Raymond v. National Life Ins. Co., 40 Wyo. 1; Wyuta Cattle Company v Connell, (Wyo.) 299 P. 279; Banker v. Seaward (Ore.) 127 P. 961; 30 C. J. 868, and cases cited. Wagner v. Davidson, (Okla.) 260 P. 37. The evidence must conform to the allegations; the judgment must conform to the allegations and the evidence, and determine all the issues. 21 C. J. 670. The essential facts for the judgment were not found. C., B. & Q. Ry. Co. v. Tolman, 31 Wyo. 175. Plaintiff was entitled to a trial upon the issues. Bank v. Luman, 5 Wyo. 159. The conflict in the findings and conclusions of law, entitle plaintiff to a new trial. Allen v. Lewis, 26 Wyo. 85. Defendant knew that the property involved was the separate property and residence of the plaintiff. If the grantee has notice of the debtor's fraudulent intent, the transfer is void. Bump on Fraudulent Conveyances, p. 200. Plow Company v. Sherman, (Okla.) 41 P. 623. Fraud has been defined by the authorities. Toone v. Walker, 243 P. 147; Wingate v. Render, (Okla.) 160 P. 614; Castle v. Bullard, 16 L.Ed. 424; 26 C. J. 1059; Martin v. U.S. 104 S.W. 678. It is a deception practiced in order to induce another to part with property. 49 N.Y.S. 1002. A fiduciary relation is not permitted to profit through trust and confidence. 6 C. J. 621 and cases cited. Hoge v. George, 27 Wyo. 423; Porter v. O'Donovan, (Ore.) 130 P. 393. Transactions of the kind here involved cannot be sustained or enforced. 6 C. J. 621. Levy v. Spencer, (Colo.) 33 P. 415. None of the instruments were executed or acknowledged by Mrs. Shipp, and were therefore invalid. 18 C. J. 231; Edwards v. Edwards, (Ark.) 49 S.W. 89. Equity will not hesitate to protect property rights where no remedy exists at law. Chesny v. Valley Live Stock Company, 34 Wyo. 378. Plaintiff alleges that she did not acknowledge the deed to the defendant and states the facts as to fraud practiced upon her to obtain her apparent acknowledgment to Exhibit "A." Plaintiff denied that she acknowledged the instruments. Its acknowledgment was necessary to convey title. 4579 C. S. 1920; 1 C. J. 818. The certificates of acknowledgment on all the instruments are without authority and void. Hall v. Mitchell, (Ark.) 1 S.W.2d 58; Oil Co. v. Cobb, (Okla.) 262 P. 650; 1 C. J. 763, 863. There was no lawful delivery of the deed. 18 C. J. 196, 197; Doty v. Barker, (Kans.) 97 P. 964, and cases cited. Plaintiff never knew of the existence of the instruments relating to this transfer until shortly before trial. There was no intentional delay. 18 C. J. 205, 212; Section 4982, W. C. S. 1920. Fraud in procuring a deed may be proved by circumstances which convince the mind of its existence. Swiney v. Womack, (Ill.) 175 N.E. 419. There was no ratification. Farmers State Bank v. Haun, 30 Wyo. 322; Montrose Co. v. Bank, (Colo.) 241 P. 327; 21 C. J. 1125. There was no allegation in the pleading that Mr. Shipp was agent of plaintiff, nor allegations of fact constituting estoppel. Sec. 74-123, R. S.; Sec. 89-1004, R. S.; Lellman v. Mills, 15 Wyo. 149; 21 C. J. 1242. The evidence clearly established forgery of the instruments. No agency was established. Mechem on Agency (2d Ed.), Sec. 485. The mere fact of Shipp being plaintiff's husband, is not in itself an authorization for him to sign her name. Wyuta Cattle Company v. Conwell, (Wyo.) 299 P. 279; 69-101-109, R. S. 1931; 30 C. J. 868. In Wyoming, forgery is a crime and a forged instrument is absolutely void. Sec. 32-1002, R. S. 1931; 2 C. J. 470, 471. A forged instrument is not entitled to record. 4 Thompson on Real Estate, Sec. 4025. The findings and decision are not sustained by sufficient evidence.
For the defendant in error, there was a brief and oral argument by R. N. Ogden, of Casper.
Mrs. Shipp admitted the acknowledgment, but claimed she thought it was of another document. This is insufficient to overthrow the certificate. Adams v. Smith, 11 Wyo. 200; 1 C. J. 896; Stidham v. Moore, (Okla.) 227 P. 128; Oil Company v. Parks, 193 P. 624. An acknowledgment is an admission of a prior act. A person acknowledging an instrument, adopts the signature written thereon by another, even where it is claimed the name is a forgery. 1 C. J. 745; 57 A. L. R. 528; Likowski v. Catlett, (Okla.) 57 A. L. R. 517; Dyal v. Norton, (Okla.) 150 P. 703; Lewis v. Watson, (Ala.) 39 Am. St. Rep. 82; Blaisdell v. Leach, 40 Am. St. Rep. 65; Gribben v. Clement, (Iowa) 119 N.W. 596. This defendant was a bona fide purchaser. 8 C. J. 1148. A married woman is estopped where she did not read the deed but relied on her husband's false representations as to its contents. 30 C. J. 941; Dobbin v. Cordiner, (Minn.) 4 L. R. A. 333; Butler Company v. Campbell, (Ala.) 78 So. 643. The evidence clearly discloses Mrs. Shipp's knowledge of the transaction. A loan obtained by means of a forged mortgage, the proceeds being used to pay off existing encumbrances, creates a right of subrogation to the right of the prior mortgagee. 43 A. L. R. 1405; 51 C. J. 277. Finance Corporation v. Credit Company, 41 Wyo. 198.
This case is closely akin to Case No. 1896, both in its controlling facts and the law applicable. It is an equitable action in effect to cancel a certain mortgage and deed and was commenced in the district court of Natrona County by D. L. Shipp, as plaintiff, against the Atlas Realty Company, a Wyoming corporation, as defendant. The parties will hereinafter be usually referred to as "plaintiff" and "defendant," except as convenience may dictate the use of their respective names. The plaintiff's name appears in the record as "D. L. Shipp" or as "Dickie L. Shipp." Since the cause was lodged here and brief filed in her behalf she died, and by order of December 18, 1934, made pursuant to consent of all the parties, Oline Rowray, Executrix and Sole Legatee and Devisee of D. L. Shipp, deceased, was substituted as plaintiff in error. The defendant had judgment rendered in its favor upon the conclusion of the trial below, and these proceedings in error were in due course instituted.
The facts necessary to be recited so that the nature of the case may be fairly understood are substantially these: On November 21, 1912, the plaintiff and her husband, E. Richard Shipp, who was an attorney at law, were residents of Casper, Wyoming, and plaintiff was the owner of Lot 5 in Block 70 therein, and also of the Southeast Quarter of the Northeast Quarter, the North Half of the Southeast Quarter and the Northeast Quarter of the Southwest Quarter in Section 15, Township 33 North, Range 79 West of the 6th P. M. Relative to the acquisition of the aforesaid property plaintiff testified on the trial in response to the question, "Did you use your own separate money?" "No, sir, I don't know as I did; I used part of it." She also stated that "I think Mr. Shipp paid part of it; we usually worked in harmony." Concerning the acreage property described above, it appears that plaintiff's husband had previously taken up a homestead claim and also an additional homestead under federal law, upon which they resided for five years, and her husband then deeded all that property to her. The acreage aforesaid comprised the additional homestead entry.
On the date mentioned in the preceding paragraph a $ 2000.00 loan with interest at ten per cent per annum, was obtained from Mr. C. H. Townsend, also a resident of Casper, for the purpose of erecting a dwelling house upon the lot property above described. This building cost approximately $ 4500.00. The Shipps procured the additional money required from other sources. To secure this loan a mortgage was given upon said lot property. The instrument was dated November 21, 1912, reciting that it was given by D. L. Shipp and E. Richard Shipp to C. H. Townsend. The names of the husband and wife were attached thereto and a notarial acknowledgment was affixed by M. P. Wheeler, certifying the fact of their being known to him, their personal...
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