Thornhill v. Masucci
| Decision Date | 01 December 1919 |
| Parties | ARTHUR THORNHILL, Appellant, v. RUGGIERE MASUCCI, et al., Respondents |
| Court | Kansas Court of Appeals |
Appeal from Jackson Circuit Court.--Hon. Wm. O. Thomas, Judge.
AFFIRMED.
Judgment affirmed.
Stubenrauch & Hartz for appellant.
Cooper Neel & Wright and Strother & Campbell for respondents.
Appeal from Jackson Circuit Court.
This is an action in equity, by the holder of a promissory note, secured by deed of trust, to cancel a release made upon the margin of the record thereof, to obtain a decree that the note is an existing and unpaid obligation and to quiet plaintiff's title thereto as against the claims and demands of the defendants, especially the defendants, Masucci, who are claiming that said note has been paid in full. The decree of the chancellor was in favor of said defendants, and plaintiff has appealed.
On June 8, 1908, Frank J. O'Loughlin, a real estate broker in Kansas City, negotiated a loan of $ 1000 from plaintiff Thornhill to George E. McManus, secured by a deed of trust on the latter's real estate. He did not do this as McManus's agent and the inference is plain that he did it for plaintiff. The note was made payable to O'Loughlin's brother, Charles. J. O'Loughlin, was due three years after date and bore six per cent simple interest payable semi-annually. The payee, however, immediately endorsed the note over to plaintiff and the latter gave O'Loughlin a check to McManus for the amount of the loan. McManus did not know Thornhill, but about seven months after the loan was made O'Loughlin introduced Thornhill to McManus as the man who had lent the money. By its terms, the note was payable at the Fidelity Trust Company, but McManus paid the interest twice a year regularly to Frank J. O'Loughlin up to December 20, 1910. Sometimes O'Loughlin would come after these payments but more frequently McManus would pay them to O'Loughlin at the latter's office, though never, it seems, when Thornhill was there. O'Loughlin would turn the money over to plaintiff by giving his personal check therefor when the latter called. Plaintiff and O'Loughlin were "associated together," had frequent business dealings with each other and the former was in the latter's office "lots of times."
In December, 1910, McManus sold the property to the defendants, the Masuccis, who are Italians unable to speak or write English. They were to assume the deed of trust, and continued to pay the interest thereon as McManus had been doing. The interest due December 8, 1911, was not paid when due, and on December 20, 1911, O'Loughlin wrote to the Masuccis a letter calling their attention to the matter and directing them to call at his office and pay it, which they did and continued to do thereafter; and plaintiff continued to get from O'Loughlin these interest payments as he had theretofore done.
On June 8, 1911, the note fell due and the Masuccis applied to O'Loughlin for a three years extension which O'Loughlin granted, giving them a written agreement to that effect dated June 8, 1911, and signed "A Thornhill by Frank J. O'Loughlin." Such an extension, made with authority, had the effect of extending the note until June 8, 1914. Thornhill undoubtedly ratified the extension for he endorsed on the note the fact of the extension but the endorsement says the note is extended to December 8, 1913.
In June, 1913, the Masuccis paid $ 300 on the principal of the note to O'Loughlin and received from him a receipt to that effect and signed F. J. O'Loughlin as agent for Thornhill. In December, 1913, they paid $ 500 and obtained a similar receipt, and on June 8, 1914, the day the note fell due under the extension, they paid the remaining $ 200, and all interest, in full of said note, and received a similar receipt together with what purported to be the note itself. This note was in the exact words of the real note even to the misspelling of the word "semi" therein. It was indorsed in blank, without recourse, by Charles J. O'Loughlin, the payee therein, and had the two credits of June 8, and Dec. 3, 1913, on the principal. Frank J. O'Loughlin went with the Masuccis to the recorder's office and there released the deed of trust as assignee. This note, together with the insurance papers and abstract, which O'Loughlin had always kept (and from whom Masuccis got them when he bought the property), were all turned over to the Masuccis, who went away thinking everything was all right and that their home was fully paid for; and they rested secure in that belief until in March, 1918, when they were served with summons in this suit by Thornhill, he claiming that the note had never been paid to him, and that the note by which the release was made was a forgery, which no doubt it was.
Plaintiff claims that he was always in possession of the true notes and that O'Loughlin never had possession thereof after plaintiff gave his check for its proceeds. There are however, some peculiar circumstances connected with it which are not satisfactorily explained. The various interest payments up to and including June 8, 1912, appear credited upon the note by plaintiff on the dates thereof. Plaintiff was careful to make these credits upon obtaining the money on them, so much so that he placed his initials after each of said credits. But no credits appear on the note for the interest due December 8, 1912, June 8, 1813, December 8, 1913, or June 8, 1914. As the Masuccis paid $ 300 in June, 1913, and $ 500 in December, 1913, the interest on the note, at least in December, 1913, and June, 1914, would have been very much less than theretofore, and had such lessened credits appeared on the note, they would have unquestionably revealed that plaintiff acquiesed in the payments made by the Masuccis on the principal. Skipping the four payments of interest due from December, 1912, to June, 1914, the note held by plaintiff has credits of interest claimed to have been paid regularly from December 8, 1914, to December 8, 1917, both inclusive. Plaintiff claims that these payments were made by O'Loughlin regularly as before, and he says he thought everything was all right until O'Loughlin, having become involved, absconded and left the city some time in first half of the...
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