Stewart v. Omaha Loan & Trust Company
| Decision Date | 25 June 1920 |
| Citation | 222 S.W. 808,283 Mo. 364 |
| Parties | JOHN D. STEWART v. OMAHA LOAN & TRUST COMPANY et al., Appellants |
| Court | Missouri Supreme Court |
Appeal from Texas Circuit Court. -- Hon. L. B. Woodside, Judge.
Affirmed.
Barton & Impey, Hiett & Scott and H. H. Baldridge for appellants.
(1) It cannot be successfully claimed that the plaintiff has any advantage as an innocent purchaser; for the following reasons: (a) Being an innocent purchaser must be affrmatively pleaded; so also must it affirmatively be proved: the onus lies on the pleader. Young v. Schofield, 132 Mo 663; Holdsworth v. Shannon, 113 Mo. 525; Conn Mut. Ins. Co. v. Smith, 117 Mo. 293; 22 Ency. Pl. & Pr 734; 23 Am. & Eng. Ency. Law (2 Ed.), 522. (b) There is not only an entire lack of evidence to sustain such a contention on the part of the plaintiff, but the evidence demonstrates that when plaintiff purchased he had both actual and constructive notice of the existence of this deed of trust and knew that all his predecessors in title had recognized it as a prior, existing and superior encumbrance. (c) The burden being on plaintiff, and the matter at issue being peculiarly within his knowledge, and he failing to testify in relation threto, a presumption is created that his testimony if introduced would have been adverse to his contention. 10 R. C. L. 887; Note: Ann. Cas. 1914A, 919; Taylor v. Murphy, 24 Mo.App. 425. (d) As plaintiff claims under the Cunningham deed reciting this deed of trust, and over his own signature had satisfied two deeds of trust reciting that the land was subject to this incumbrance, he is estopped from posing as an innocent purchaser. 16 Cyc. 685; 10 R. C. L. 681; 18 C. J. 264; Steele v. Culver, 158 Mo. 136. (e) Having deducted the amount of this deed of trust from the purchase price, plaintiff cannot assert its invalidity, much less be an innocent purchaser as against it. (f) If these deeds of trust were simultaneous, the doctrine of innocent purchaser does not apply. Linville v. Savage, 58 Mo. 248; 1 Jones on Mortgages (5 Ed.), secs. 606, 608. Even where several notes are secured by a single mortgage, one who takes an asignment of part of the notes should inquire of the maker and of the payee whether the others have been sold with a preferred lien upon the security. 1 Jones on Mortgages (5 Ed.), sec. 606. (2) It may be admitted that under our law where a single mortgage is given to secure several obligations maturing at different times, other things being equal, these obligations take priority according to maturity. This, however, is the rule of last resort. If from all the evidence, it appears that the parties intended to give one mortgage, priority over the other, then such intention will be absolutely controlling. 27 Cyc. 1167, 1171, 1196; 1 Jones on Mortgages (5 Ed.), secs. 606, 607, 608; 20 Am. & Eng. Ency. Law (2 Ed.), 1048, 1049, 1050; Ellis v. Lamme, 42 Mo. 153; Linville v. Savage, 58 Mo. 248; Loewan v. Forsee, 137 Mo. 40; Brown v. Barber, 244 Mo. 150. (3) It may also be admitted that in Isett v. Brewster, 17 Iowa 503, the rule of prior maturity was applied where the obligations were secured by separate simultaneous mortgages. However, it has also been held that a foreclosure of one of two simultaneous mortgages is not effectual to settle the relative rights of the purchaser at the foreclosure and the holder of the other mortgage. A suit in equity is necessary for that purpose. Van Aken v. Gleason, 34 Mich. 477. (4) In determining priority of execution, fractions of a day will be considered. Sanely v. Crapenhoft, 95 N.W. 352. Where several mortgages are executed and recorded at the same time, and it can be ascertained that one was intended to have priority over the others, then for the purpose of carrying such intention into effect the law will presume that the mortgage which was intended to be preferred was first delivered. Jones v. Phelps, 2 Barb. Ch. 440; Butler v. Mazeppa Bank, 94 Wis. 351; Trompcynski v. Struck, 105 Wis. 440. (5) It is the duty of the recorder to record instruments "in the order of time when the same shall have been delivered for record." R. S. 1909, sec. 10388. It therefore devolved upon the recorder to determine which of these deeds of trust was first delivered for record and to record it first. This he did at the time in favor of the principal deed of trust, one thousand dollars, recording it in Book 16 at page 332, deferring the commission deed of trust to page 337 of the same book. Priority of record may be shown by the numbering and, for the same reason, by the paging of the record. Conn. Mut. L. v. King, 75 N.W. 376; Lamkin v. Bank, 23 S.E. 390; 1 Jones on Mortgages (5 Ed.), sec. 534. "When a grantor conveys the same land to two different persons on the same day, the deed which is first recorded carries the title." Smith v. Johnson, 107 Mo. 497; 19 R. C. L. 408; 27 Cyc. 1194. (6) A controlling agreement or equity may appear upon the face of the instruments whereby one will be given priority over the other. Ellis v. Lamme, 42 Mo. 143; 27 Cyc. 1226; 20 Am. & Eng. Ency. Law (2 Ed.), 1049; 17 Am. & Eng. Ency Law (2 Ed.), 9; 13 C. J. 528. (a) In determining such intent, the court may consider the fact that two deeds of trust were given, and this is presumed to have been done for a purpose, and to have some effect. 13 C. J. 527, note 46. (b) The court will also consider the situation, surroundings and business of the parties, and the general nature and purpose of the transaction involved. 17 Am. & Eng. Ency. Law (2 Ed.), 21; 13 C. J. 540, 542. (c) The court will consider also the construction placed upon the transaction by the parties themselves and their privies. 13 C. J. 546; 17 Am. & Eng. Ency. Law (2 Ed.), 23. (7) Aside from that which appears upon the face of the instruments, a controlling agreement for priority between the original or subsequent parties may be shown: and such agreement may rest in and be proved by parol. 1 Jones on Mortgages (5 Ed.), sec. 608; 8 Ency. Ev. 685; Linville v. Savage, 58 Mo. 248; Loewan v. Forsee, 137 Mo. 40; Minor v. Sheehan, 15 N.W. 687. (8) The Omaha Loan and Trust Company, while owning both these deeds of trust, sold the one now in question as, and represented it to be, a first encumbrance. This constituted a controlling agreement for priority. 20 Am. & Eng. Ency. Law (2 Ed.), 1040; 27 Cyc. 1228; 19 R. C. L. 411; Note: 48 L. R. A. (N. S.) 761; Lane v. Niekerson, 17 Hun, 148. (9) Whatever may have been the original status of these deeds of trust, if Mautz and DeForest deducted the amount of this mortgage from the purchase price of the land and accepted a deed in which this encumbrance was excepted from the covenants, then they, and plaintiff claiming under them, are estopped from denying its validity or superiority. U.S. Bond Co. v. Keahy, 155 P. 537; Jones v. Perkins, 144 P. 183; Fuller v. Devold, 144 Mo.App. 96; 1 Jones on Mortgages (5 Ed.), 696; Scheppelman v. Feurth, 87 Mo. 353. (10) The recitals in the Cunningham deed and the several deeds of trust given to Rodgers are prima-facie evidence of the facts herein stated against the parties thereto as well as their privies. This is based upon the general rule of evidence as to admissions and applies even where an estoppel is not created. Allen v. Kennedy, 91 Mo. 324; 1 R. C. L. 484; 4 Ency. Ev. 187; 18 C. J. 264, 265 and note 96. (11) The conversation with and representations to Miss Leverich at the time she purchased could not only be considered in aid of construction, but also this in and of itself constituted a controlling agreement as to priority. 20 Am. & Eng. Ency. Law (2 Ed.), 1040; 27 Cyc. 1228; 19 R. C. L. 411; Note: 48 L. R. A. (N. S.) 761; Lane v. Nickerson, 17 Hun, 148. This may be proved by parol. 1 Jones on Mortgages (5 Ed.), sec. 608; 8 Ency. Ev. 685; Linville v. Savage, 58 Mo. 248; Loewan v. Forsee, 137 Mo. 29, 40. It was therefore error to reject this testimony.
Lamar, Lamar & Lamar for respondent.
(1) Plaintiff's petition says that he is the absolute owner of the land described in the petition. Defendant's answer is, first, a denial that plaintiff is such owner, and then says "said deed of trust (defendant's deed of trust) is a superior lien, incumbrance and claim against said real estate and takes priority over all the right, title and claim of plaintiff in, to or against said real property." The remainder of said answer simply describes this deed of trust and asks foreclosure. As we understand it, this simply raises a question of law arising on the face of the record as to which deed of trust under the law is a prior lien. The defendant does not by her answer set forth any facts which would authorize a court of equity to postpone the lien of the deed of trust under which plaintiff claims, which matured first, to the one held by defendant. Even if there had been no foreclosure and the action were between defendant and the original holder of the note first maturing, in order to authorize a court of equity to postpone the lien of the deed of trust securing the first note, to the one securing the note maturing last, the facts authorizing such postponement must be pleaded and proven. 27 Cyc. 1509-d and note 96; Boone on Code Pleadings, 283; 20 Am. and Eng. Enc. Law (2 Ed.) 1049; Schanework v. Hoberecht, 117 Mo. 31; State ex rel. v. Barnett, 245 Mo. 116; Mallinckrodt Chemical Works v. Nemnich, 169 Mo. 297; Lappin v. Nichols, 263 Mo. 290; Vogeler v. Punch, 205 Mo. 577; Pier v. Heinrichoffen, 52 Mo. 336; Sawyer v. Bradshaw, 125 Ill. 440; Abbott v. Peck, 35 Minn. 499; Austin v. Hatch, 159 Mass. 198. (a) The answer of defendant would not support a judgment, even if the court had granted it, postponing the deed of trust, under which plaintiff claims, to the one held by defendant. A judgment or decree cannot be...
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