Sapp v. Warner

• Decision Date: 19 April 1932
• Citation: 105 Fla. 245,141 So. 124
• Parties: SAPP et al. v. WARNER et al.
• Court: Florida Supreme Court

141 So. 124

105 Fla. 245

SAPP et al. v. WARNER et al.

Florida Supreme Court

April 19, 1932

En Banc.

Suit by Annie Lester Patterson Warner and others against William E Sapp and others. From an adverse decree, defendants appeal.

Affirmed.

BROWN J., dissenting. Appeal from Circuit Court, Dade County; Ira A. Hutchison, judge.

COUNSEL

Redfearn & Ferrell, Semple & Hirschman, and T. J. Dowdell, and of Miami, for appellants.

Shackleford Ivy Farrior & Shannon, of Tampa, and Evans & Mershon and O B. Simmons, Jr., all of Miami, for appellees.

OPINION

DAVIS J.

From a final decree foreclosing an unrecorded purchase-money mortgage, the defendants below, William E. Sapp and Mrs William E. Sapp, his wife, Commercial Bank & Trust Company, a Florida corporation, and Lindsey Hopkins, have entered their appeal on behalf of themselves, and all of their similarly situated codefendants, assigning as error the entry of said final decree for the complainants. The decree appealed from was arrived at on the basis of the record before the chancellor as it appeared on the final hearing, considered in connection with a special stipulation of facts which had been agreed to by all the parties, so as to directly present the one controlling point of law necessary to be determined in order to fix the equities.

The case is apparently one of first impression in this court, and in view of the number of defendants who will be affected by the ultimate decision, the question of law involved appears to be of considerable importance. Oral argument was had before Division B, where the controversy over the question was ably presented by both sides. In addition to this, the court has had the benefit of elaborate briefs convincingly prepared and filed by several of different counsel for appellants; it appearing that the parties interested on the appellants' side of the question amount to nearly two hundred in number, due to the peculiar circumstances under which this case arose.

Notwithstanding the voluminous record, the facts are not controverted, and there is but one outstanding question of law presented for decision, upon the determination of which will depend the reversal or affirmance of the decree appealed from: 'Is a person who claims under a duly recorded deed from the guardian of a minor, whose authority to make the deed is dependent upon proceedings had before the County Judge, charged with notice of the terms and conditions upon which the guardian was authorized by the County Judge to sell the minor's land, when it appears that while the grantees from the grantee of the guardian are otherwise bona fide purchasers for value without notice, the records of the County Judge, nevertheless, show that the lands involved in a foreclosure suit brought to enforce an unrecorded purchase money mortgage given to the guardian and another, by his original grantee, were lands sold by such guardian under authority of the Court, upon terms of part cash and balance to be secured by a purchase money mortgage on the land sold, it appearing that all of the defendants claim their interests under the recorded deed from the guardian, executed under and in pursuance of the County Judge's proceedings, but who were without any notice or knowledge of the unrecorded purchase money mortgage, except such as would be charged to them by virtue of what could have been ascertained by inquiry based upon the proceedings taken by the guardian before the County Judge?'

The lower court decided the question in the affirmative, and decreed that the foreclosure should proceed under complainants' unrecorded purchase-money mortgage, notwithstanding the claims of the defendants that they should be considered as bona fide purchasers for value, without notice, from the guardian's original grantee under the recorded warranty deed which the guardian had executed at the time of the guardian's sale.

The facts, stated chronologically, are as follows:

The complainant Mrs. Warner was the daughter of the complainant Mrs. Markley. Mrs. Warner (formerly Annie Lester Patterson), on June 23, 1911, and at the time of the making of the guardian's sale hereinafter mentioned, was a minor; James M. Jackson, Jr., was the legally constituted guardian of her estate, under order of the county judge of Dade county.

The minor was originally seized and possessed of the fee-simple title to the lands involved in this suit, subject to the estate by dower of her mother, Mrs. Markley.

On June 23, 1911, the county judge of Dade county entered an order based upon a petition filed by James M. Jackson, Jr., guardian, authorizing the guardian to sell the minor's interest in the real estate involved in this suit and other lands, at private sale, for cash or upon terms. On September 6, 1932, James M. Jackson, Jr., filed his report of sale in the office of county judge of Dade county, showing that the real estate involved in this suit had been sold to George E. Merrick for the sum of $20,000 upon the following terms: $2,000 cash and $18,000 in five years, together with interest at the rate of 8 per cent. per annum, payable semiannually on all deferred payments, and that the said deferred payments were to be secured by a purchase-money mortgage on said property.

The report further shows that the property had been sold at private sale to the highest and best bidder 'on reasonable terms' to George E. Merrick for the sum of $20,000, 'two-thirds of which the said Annie Lester Patterson, a minor, is entitled to receive, and will receive, and the other one-third of said $20,000 being paid to Jessie B. Markley, formerly Jessie B. Patterson, widow of Samuel L. Patterson, and mother of Annie Lester Patterson, a minor,' on certain terms and conditions as to deferred payments which contemplated and embraced the total purchase price as being subject thereto.

On Suptember 5, 1923, based upon he report of sale aforesaid, the county judge entered an order confirming the said sale and directing the guardian to execute and deliver a deed to George E. Merrick, conveying all of the right, title, and interest of the minor in and to said property, and authorizing and empowering him 'to take back a purchase money mortgage constituting a first lien against the property for all deferred payments.'

On August 16, 1923, a deed was executed by Jessie B. Markley, joined by her husband, and James M. Jackson, Jr., guardian of Annie Lester Patterson, a minor, conveying the property to George E. Merrick. This deed was dated August 16, 1923, but it was not filed for record until September 7, 1923, the day after the county judge entered the order confirming the sale.

On August 4, 1923, George E. Merrick executed two promissory notes, bearing the date and evidencing the deferred portion of the purchase price for the land. One of the notes was for $12,000, payable to the order of James M. Jackson, Jr., as guardian of Annie Lester Patterson, and the other of the notes was for $6,000, payable to the order of Jessie B. Markley. The notes, according to their terms, were to become due on or before five years after said date.

To secure these notes, George E. Merrick executed and delivered a purchase-money mortgage upon the land he had purchased at the guardian's sale. This mortgage was executed to James M. Jackson, Jr., as guardian of Annie Lester Patterson, a minor, and to Jessie B. Markley, individually, because of her own individual interest in the same property, and was on the same date as the notes which were secured thereby. This mortgage was never recorded because it was lost or misplaced and was not found until after the bill was filed in this cause and shortly before the final hearing.

In 1926, Merrick and wife executed and delivered two mortgages, dated August 4, 1923, acknowledged September 30, 1926, one of which was executed to James M. Jackson, Jr., as guardian of Annie Lester Patterson, for the purpose of securing the note of $12,000 executed to the guardian, as aforesaid, and the other of which was executed to Jessie B. Markley for the purpose of securing the note for $6,000, payable to Mrs. Markley, as aforesaid. Each of said mortgages showed that it was a purchase-money mortgage upon the land and was given in lieu of the former mortgate of like import, tenor, and date, which had been lost prior to record. These last-mentioned mortgages were filed for record on March 4, 1927, and were recorded.

The parcel of land involved in this suit, when conveyed to Merrick, was an entire parcel, but after the purchase thereof by Merrick he caused the same to be subdivided into lots and blocks which were later sold from time to time to the numerous defendants who later appeared to resist the foreclosure here involved.

On November 1, 1924, after the record of the deed from Jackson, as guardian, and Mrs. Markley to Merrick, but before the execution and record of the two evidentiary mortgages above mentioned, Merrick executed to the appellant A. J. Orme, as trustee, a mortgage upon all of said lands and other lands, securing an indebtedness of $300,000, and after the record of the deed from Jackson, as guardian, and Mrs. Markley to Merrick, but before the filing for record of the two evidentiary mortgages above mentioned, Merrick executed deeds to certain of the defendants described in the bill, purporting to convey specified lots in the subdivision of the property conveyed by the guardian and Mrs. Markley to him. These deeds appear to have been recorded after the deed from the guardian and Mrs. Markley to Merrick, but before the recording of the two evidentiary mortgages above mentioned.

Merrick later executed a deed conveying to Coral Gables Corporation all of the land, except such lots as had theretofore been conveyed by him to...