Schelp v. Nicholls

• Decision Date: 10 January 1928
• Docket Number: No. 19893.,19893.
• Parties: SCHELP v. NICHOLLS.
• Court: Missouri Court of Appeals

300 S.W. 1031

SCHELP v. NICHOLLS.

No. 19893.

St. Louis Court of Appeals, Missouri.

January 10, 1928.

Appeal from St. Louis Circuit Court; John W. Calhoun, Judge.

"Not to be officially published."

Action by G. H. Schelp against Charles C. Nicholls. Judgment for plaintiff, and defendant appeals. Affirmed.

See, also, 263 S. W. 1017.

R. M. Nichols, of St. Louis, for appellant.

Abbott, Fauntleroy, Cullen & Edwards, of St. Louis, for respondent.

SUTTON, C.

This is an action on a promissory note for the sum of $1,635.60, duly executed and delivered by defendant to plaintiff on March 23, 1920, bearing interest from date at the rate of 7½ per cent. per annum, payable in installments of $25 per month. It was provided in the note that, in the event of any default in the payment of the monthly installments when due, then the principal sum of the note, or any balance thereof, together with all interest accrued at the time of default, should become immediately due and payable. Defendant paid three of the installments as they fell due, but failed to make any further payments. Thereafter, on December 13, 1921, this suit was brought. The trial resulted in a judgment in favor of plaintiff for $2,275.85, being the full amount of the note, with interest, less payments. Defendant appeals.

There is very little dispute about the facts in the case. On and prior to May 15, 1914, plaintiff held six promissory notes aggregating $4,439.90, bearing interest from date at the rate of 7½ per cent. per annum, executed and delivered to plaintiff by Nicholls-Ritter-Goodnow Realty Company, a corporation, and made payable to plaintiff, or his order, on ten days' demand. These notes were executed and delivered to plaintiff in consideration of money advanced to said Nicholls-Ritter-Goodnow Realty Company, and were indorsed by defendant at the time of their execution and delivery. As collateral security for the payment of said notes, said company pledged and delivered to plaintiff a promissory note for the sum of $4,500, executed by John L. Shumate and Sarah Shumate, which note was secured by deed of trust on improved real estate situate at 5912 Bartmer avenue in the city of St. Louis. The condition of said pledge, which is embodied in each of the six notes executed and delivered to plaintiff by said company, is as follows:

"In the event of the nonpayment of this note at maturity the holder thereof is hereby invested with full authority to use, transfer, hypothecate, sell or convey the said collateral, or any collateral substituted for or added to the above, or any part thereof, or to cause the same to be done, at public or private sale, with or without notice or demand of any sort, at such place and on such terms as the said holder thereof may deem best, and the holder of this note is authorized to purchase said collateral when sold for his or its own protection; and the proceeds of such sale, transfer or hypothecation shall be applied to the payment of this note, together with all protests, damages, interest, costs and charges due upon said note, or incurred by reason of its nonpayment when due, or in the execution of this power, the surplus, if any, after the payment of this note, together with all charges above stated, shall be paid to the drawer of this note."

Defendant was president of said company, and as such president executed the six notes, and delivered the same with the Shumate note and deed of trust to plaintiff. In April, 1914, when said six notes of said company fell due, plaintiff made demand of defendant and said company for the payment of said notes. The company was insolvent at that time, and was not long afterwards adjudged a bankrupt. The defendant, who was still the president of said company, informed plaintiff that the company was insolvent, and that he himself could not pay the notes. He urged the plaintiff to foreclose the deed of trust given to secure the Shumate note. Defendant was the trustee in said deed of trust, and he urged the plaintiff to allow him as trustee to immediately foreclose the deed of trust by sale of the property under the power given in the deed of trust, and told the plaintiff that he should buy the property at the sale, and credit the amount of the purchase price on said company's notes, and that he and the company, if they were able, would pay the difference between the sum so bid and the amount due on said notes. To this the plaintiff assented, and accordingly, on May 15, 1914, the defendant as trustee sold the property at public vendue, at the east front door of the courthouse, after having given public notice thereof pursuant to the provisions of the deed of trust. At said sale the plaintiff, being the highest bidder, became the purchaser of the property at the price and sum of $3,201, and the defendant, as trustee, conveyed the property to plaintiff by deed in the usual form, "to have and to hold the same unto him, his heirs and assigns forever." At the conclusion of the foreclosure sale plaintiff paid the costs and expenses thereof amounting to $65.88, which includes a fee of $42 to the defendant as trustee for his services, and the defendant made, on the back of one of the six notes executed by defendant to plaintiff as aforesaid, it being for the sum of $3,674.53, an indorsement showing the amount of the plaintiff's bid and the cost and expenses of the sale, and concluding thus:

"Net credit $3,135.32; Credit for unexpired insurance $74.68."

On September 26, 1916, defendant wrote plaintiff as follows:

"If I am successful in making money I certainly intend to pay you any balance which may be due you on the notes of the Nicholls-Ritter-Goodnow Realty Co., which I indorsed."

Prior to this foreclosure sale defendant, as president of the Nicholls-Ritter-Goodnow Realty Company, had been engaged in the real estate business in the city of St. Louis for many years, and had acted for plaintiff as his agent in various real estate transactions. After the foreclosure sale, defendant continued to act as plaintiff's agent, and collected rents on the property purchased at such sale, and paid the same over to plaintiff. He also as agent for plaintiff undertook to find a purchaser for the property, and on May 17, 1918, in the name of Chas. C. Nicholls Realty...