Walker v. Conant
| Decision Date | 13 April 1888 |
| Citation | 37 N.W. 292,69 Mich. 321 |
| Court | Michigan Supreme Court |
| Parties | WALKER v. CONANT. |
Error to circuit court, Monroe county.
Action by Charles I. Walker against Maria S. Conant, to recover money paid her on a forged mortgage. The circuit court directed a verdict for defendant, and plaintiff brings error.
This cause was before this court upon the pleadings in the January term, 1887, and we then overruled the demurrer to the special count of the declaration, and held that there were facts enough stated in such count to permit a recovery if no defense were made. It was there stated (see opinion, 31 N.W 787) that, as a general rule, money paid under a mistake of material facts may be recovered back, although there was negligence upon the part of the person making the payment, but that the rule was subject to the qualification that the payment cannot be recalled when the situation of the party receiving the money has been changed in consequence of the payment, and it would be inequitable to allow a recovery. The person making the payment must in such case bear the loss occasioned by his own negligence. The case has been since tried in the court below, and a verdict directed for the defendant. In this court there is on controversy about the facts, and the only question to be determined is, what should have been the judgment in the court below upon such facts?
Briefly the case is this: On or about the 20th day of December, 1883 one Edgar Van Riper obtained from the defendant, Maria S Conant, a loan of $1,000. The negotiations for the loan were made with one James Armitage, who was acting as the agent of Mrs. Conant. The loan was secured by a note and mortgage, payable in five years, purporting to be executed by Henry Van Riper, (the father of Edgar;) the mortgage also being signed by his wife, apparently. It was upon 160 acres of land, of the value of at least $8,000, owned by Henry Van Riper, and situated near Flat Rock, in the county of Wayne, in this state. This note and mortgage were forged, and were never executed by the elder Van Riper or his wife, nor by any person to their knowledge, or by their consent or authority. Armitage and Mrs. Conant both supposed the securities to be genuine. While this mortgage was upon the record in the register's office of Wayne county, and in January, 1885, this same Edgar Van Riper applied to the firm of Walker & Walker, attorneys at Detroit, for a loan for his father, Henry Van Riper, of $3,000, and offered security by mortgage upon the same premises covered by the Conant mortgage, which was then unpaid. E. C. Walker, of Walker & Walker, and a brother of the plaintiff, conducted all the negotiations with Edgar Van Riper. He never saw him before, and has never seen Henry Van Riper or his wife, or had any negotiations with either of them. He consented to loan the money if the proper abstracts of title were furnished, and a first mortgage given upon the land. Edgar stated to Walker that James Armitage, of Monroe, held a mortgage for $1,000 upon the premises, which Armitage would release upon payment, and that he wished such mortgage to be paid out of the $3,000 to be borrowed of Walker. Walker then wrote to Armitage as follows:
Edgar Van Riper also wrote at the same time the following letter:
Armitage replied to Walker as follows:
It is admitted that Armitage was still the agent of Mrs. Conant, and authorized to act for her. Upon receiving this letter from Armitage, and the papers therein contained, Walker drew a bond and mortgage for $3,000 from Henry Van Riper and wife to one Helen M. Dudley, and gave them to Edgar Van Riper to have them executed, who brought them back, apparently signed by Henry Van Riper and wife, and purporting to be properly witnessed and acknowledged by John L. Near, a notary public, residing at Flat Rock, and personally well known to Walker. The title of Henry Van Riper being clear to the premises, Walker accepted the bond and mortgage. He drew the check of Walker & Walker for $1,088 and some cents,-the amount then apparently due upon the Conant mortgage,-and deposited the same to the credit of Armitage in the Detroit National Bank. He paid the balance of the $3,000, less his commission, to Edgar Van Riper in money at his office. Edgar told E. C. Walker to pay the mortgage to Conant out of the $3,000, and it was understood it should be paid in the manner it was paid. Walker then wrote Armitage as follows: "DETROIT, January 26, 1885.
To which Armitage replied: "MONROE, MICH., January 27, 1885.
The land covered by these two mortgages is situated some 15 or 20 miles from Detroit. The bond and mortgage taken in the name of Helen M. Dudley was, immediately after its execution, assigned to the plaintiff by E. C. Walker, he being authorized by power of attorney to execute it. The money loaned by Walker & Walker, and secured by this mortgage, belonged to the plaintiff, and E. C. Walker was acting as his agent in making the loan. E. C. Walker consulted the plaintiff before concluding the loan, and the plaintiff consented to it. At the time the bond and mortgage were offered to E. C. Walker, he took no steps to ascertain whether they was genuine or not, taking it for granted that it was all right; nor did he inquire into the authority of the son to act for his father, but acted upon the presumption that he had such authority. The bond and mortgage proved to be a forgery; but the plaintiff did not ascertain that fact until in the spring and summer of 1886, when he wrote to Henry Van Riper for payment of interest. Upon the receipt of this demand for interest from plaintiff, and upon an examination of the records consequent thereon, Henry Van Riper first became acquainted with the fact of the execution of this mortgage, and the prior execution and discharge of the Conant mortgage. The mortgage and note to Mrs. Conant are probably lost or destroyed, as Edgar Van Riper testified he did not have them, and did not remember taking them from E. C. Walker. Walker did not have them at the time of the trial, and was pretty certain he delivered them to Edgar. The truth is, no doubt, that he handed them over to Edgar, and he destroyed them, as they were evidences of his crime.
It appears, and is conceded upon both sides, that the plaintiff and defendant are equally innocent in this transaction. Both mortgages were taken by agents, who were negligent in ascertaining the genuineness of their securities, and the authority of Edgar to act for his father, and in his behalf in making the loans. So far, the parties seem to stand upon an equal footing. Both were duped by the younger Van Riper because of a want of sufficient caution upon the part of their agents. One of them must necessarily suffer. But by no act of Mrs. Conant has the plaintiff been put in any worse condition than he would have been had she not been concerned in the transaction; while by the act of the plaintiff's agent in delivering her note and mortgage to Edgar she has been damnified to some extent,-how much cannot be told,-if she has to lose the money paid to her. I think the money paid to Mrs. Conant, and represented by her note and mortgage, was in reality paid to her or her...
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