Tyson v. Farm & Home Savings & Loan Ass'n.

• Decision Date: 12 June 1900
• Citation: 57 S.W. 740,156 Mo. 588
• Court: Missouri Supreme Court
• Parties: TYSON et ux. v. FARM & HOME SAVINGS & LOAN ASS'N.

57 S.W. 740

156 Mo. 588

TYSON et ux. v. FARM & HOME SAVINGS & LOAN ASS'N.

Supreme Court of Missouri, Division No. 1.

June 12, 1900.

MORTGAGES — CANCELLATION — FAILURE OF ADVERSE PARTY TO GIVE DEPOSITION — STRIKING PLEADINGS — DISCRETION OF COURT.

1. A motion to strike out an adverse party's pleadings, for refusal to give his deposition on being summoned, under Rev. St. 1889, § 8924, authorizing the striking of a party's pleadings in such case, is properly denied where he came to the court house in response to such summons, and waited nearly all day without hearing any one call him, though he did not go to the clerk's office in the court house, where he was directed by the summons to appear.

2. The only legitimate purpose of taking the deposition of one's adversary is to use it as evidence at the trial; and, when the court is satisfied that the purpose is ulterior to that, the court is not required to, and should not, strike out the party's pleading for refusing to submit to the examination.

3. A borrower, on signing an obligation for a loan by a company, gave an order on it to pay the sum to the company's agent. The agent received the amount, and, without the borrower's direction, applied the greater part to the satisfaction of a personal demand against a debtor who was a creditor of the borrower, and, on demand, refused payment to the borrower. Held, that as the company was not misled by the borrower's order to pay the amount to the agent, which it knew was the course of all loans passing through the agency, and was merely a device to shift to its customers the responsibility for misconduct of its agents, the deed of trust given as security for the loan was properly canceled.

Appeal from circuit court, Douglas county; W. N. Evans, Judge.

Bill by Abraham S. Tyson and wife against the Farm & Home Savings & Loan Association. From a decree for complainants, defendant appeals. Affirmed.

Suit in equity to set aside a deed of trust on the ground of fraud; the defense being a denial of the fraud, and a cross bill to foreclose the deed of trust. There was a finding for the plaintiffs on the issues, and a decree canceling the deed of trust, from which defendant appeals.

Wm. O. Mead and T. T. Loy, for appellant. A. H. Livingston, for respondents.

VALLIANT, J.

The following controlling facts are gathered from the evidence: The defendant corporation had an agent (one Woods) at Norwood, Mo., through whom its business at that point passed, and through whom the transactions we are now concerned with passed. Tyson owned a small farm, worth about $1,200, in Douglas county, on which he had given what is called in the record a "fruit-tree mortgage," or two such mortgages, to a fruit-nursery concern in Pike county, called Stark Bros., the nature of which was an agreement on the part of the nursery concern to furnish a certain number of fruit trees, to be planted on the farm, and in payment for which they were to have the fruit crops for any 2 years, within 15 years, to be selected by them, and Tyson agreed not to sell the land until that obligation was satisfied. Those so-called mortgages were duly recorded. There was also evidence showing that Woods had actual knowledge of them. In this condition, Tyson applied to defendant corporation, through Woods, for a loan of $250, to be secured by a mortgage on his farm. The application for the loan was made out on an elaborate printed blank furnished by Woods for the purpose, signed and sworn to by Tyson before Woods as notary public. In this application one of the questions asked is, "Is the land free from incumbrance?" and the answer is, "Yes." The application was favorably received by the defendant corporation, and in pursuance thereof Tyson and wife signed an obligation subscribing for $1,000 of stock in the corporation, assigning it to the corporation as collateral for the prospective loan, agreeing to pay semiannually dues, interest, and premiums thereon, amounting to $34.50 for a period of 144 months; and at the same time they executed the deed of trust in question, on their farm, to secure that obligation, in which deed, among other penalties, it is stipulated that, if default be made in any one of the semiannual payments, the whole obligation may be treated as due, the collateral sold, the deed of trust foreclosed, and Tyson held for the balance. Tyson also at the same time signed a paper in the form of an order on the corporation to pay the amount of the loan to Woods, and that order should be a receipt for the same. Woods testified that it was the invariable practice, when a loan was made through his agency, that the borrower gave him an order on the company for the proceeds of the loan, and the company would send the money to him, giving him directions what amount of it he was to deduct for expenses, and how much he was to pay over to the borrower, and that in all such matters he obeyed the company's instructions, as its agent; that in this instance the company retained $41.50 out of...