Opinion
No. 41758.
September 11, 1950.
APPEAL FROM THE CIRCUIT COURT, BUCHANAN COUNTY, SAM WILCOX, J.
Wm. Orr Sawyers, James P. Hull, St. Joseph, for appellants.
W. H. Utz, Jr., St. Joseph, for respondents.
This is a suit in two counts; one to have a general warranty deed declared a mortgage, and the other to determine the title to personalty and for an accounting. The parties to the suit are the heirs and the administratrix of Robert I. Young, Senior. The administratrix is interested in the second count only. The defendants are Mr. Young's son, Thomas T. Young, and his wife, Emma Lee. On December 18, 1939 Mr. and Mrs. Young deeded their 174 acre farm in Buchanan County to their son Thomas and it is this deed that Mr. and Mrs. Young's sons and daughters and grandchildren ask to have declared a mortgage. In their petition they alleged that Mr. and Mrs. Young became involved financially and to meet delinquent taxes and interest on their farm loans requested Thomas to advance them as an additional loan the sum of $1,200, for which they executed a note. In return Mr. and Mrs. Young executed and delivered a warranty deed to Thomas but, it is alleged, "with the distinct understanding * * * that it was to be accepted by him as a mortgage and as security to him" for the $1,200 loan.
The trial court found for the defendants and the plaintiffs contend upon this appeal that the judgment vesting title to the land in Thomas is "in irreconcilable conflict with all the substantial evidence and unconscionable in the light of the record" and unjustly operates to disinherit Mr. Young's seven other heirs. They contend that the evidence conclusively shows that Thomas' advancements were loans and that the deed was intended as security and not as a conveyance and that this court should so decree. They say that Thomas imposed upon his parents and by his "overmastering conduct" took advantage of a confidential relationship and procured the deed which was not delivered as a deed but was intended as conditional security for advances. It is contended in all the circumstances, in short, that the plaintiffs are entitled to have the deed declared a mortgage. Stafford v. McDonnell, 359 Mo. 925, 224 S.W.2d 951; Heath v. Heath, 359 Mo. 590, 222 S.W.2d 778; 59 C. J. S., Mortgages, § 18, p. 53; 36 Am. Jur., Sec. 125, p. 749.
Mr. and Mrs. Young owned and operated the two tracts of land comprising the 174 acre farm for many years. By 1925 there was an indebtedness against the farm evidenced by a first deed of trust securing a note in the sum of $6,700. They were unable to reduce the debt and in 1934 their total indebtedness was refinanced with the Federal Land Bank and there were two notes secured by deeds of trust, one for $6,500 and the other for $2,500. One of the plaintiffs' witnesses testified that even with the refinancing Mr. and Mrs. Young lacked $280 having enough to extinguish the prior loans and that a chattel mortgage was executed on certain livestock to secure that sum. It was at this time that Thomas, who was employed in the Panama Canal Zone, advanced his father and mother the sum of $1,200 to apply on delinquent interest. They executed and delivered to Thomas a note representing the advance and it is this advance and this note upon which the plaintiffs principally rely as establishing that the subsequent transaction demonstrates a loan and not an absolute conveyance. But, Thomas testified that by 1939 he had advanced his father and mother the total sum of $3,000. By that time there was about $8,200 due on the indebtedness and it was Tom's view that his advances exceeded any equity in the farm. He came home on his honeymoon in that year and the farm indebtedness was again in default and foreclosure was threatened. He told his father that he would not advance further sums. He said that his father then turned to his brother John and said "What are you going to do about it?" Johnnie said he couldn't do anything and dad said that he was going to give me a deed to the farm. Thomas returned to Panama and in February Mr. and Mrs. Young mailed him the deed. The deed was executed and acknowledged on the 18th day of December 1939 and recited a consideration of "one dollar and other valuable considerations." Thomas testified that his father and mother gave him the deed and that he accepted it in payment of their indebtedness to him.
It may be noted here that there are circumstances and testimony supporting the plaintiffs' claim that the deed is in fact a mortgage. Thomas received the deed in February 1940 but did not record it until April 26, 1946. That fact and the testimony of the plaintiffs that they had no knowledge of the deed is a circumstance favorable to them. In addition the secretary of the National Farm Loan Association who drew the deed for Mr. and Mrs. Young said that "he (Mr. Young) wanted me to make a deed for him to protect Tom or secure him against the payment of those delinquencies and that Tom was the only one able to help him." However, even the plaintiffs' witnesses corroborate Thomas' claim that he made advancements, in addition to the $1,200, both before and after the deed was delivered and these advances were not evidenced by a note. These were advances that only Thomas, of all the brothers and sisters, was able to make. Wright v. Brown, Mo.Sup., 177 S.W.2d 506. Thomas as did not record the deed until April 26, 1946 but he did record it prior to the death of either Mr. or Mrs. Young. Mrs. Young died in August 1946 and Mr. Young died on the 19th day of July 1947 and this suit was instituted in September 1947. The fact that the deed was recorded with the knowledge of the grantors is indicative of unconditional delivery and of the grantors' intention that the instrument was to be operative as an absolute conveyance, as it purported on its face. Rone v. Ward, 357 Mo. 1010, 1015, 212 S.W.2d 404; Powell v. Huffman, 358 Mo. 138, 213 S.W.2d 473. In January 1943 Thomas came home and took possession of the farm and operated it to the exclusion of either his father and mother or brothers and sisters and that circumstance is indicative of an absolute conveyance rather than of a mortgage. 59 C. J. S., Mortgages, § 44(b), p. 80; 36 Am.Jur., Sec. 157, p. 767. In this connection several of Mr. Young's old friends and neighbors testified that Mr. Young had told them that he no longer had any interest in the farm but that it belonged to Thomas. Wright v. Brown, supra. Thomas made advances to his father and mother but he did not handle their financial affairs or manage their property for them and his evidence repels the plaintiffs' claim of a confidential or fiduciary relationship. Lastofka v. Lastofka, 339 Mo. 770, 99 S.W.2d 46. Compare: Holland v. Anderson, Mo.Sup., 196 S.W.2d 175; Heath v. Heath, 359 Mo. 590, 222 S.W.2d 778. As we have said, there was evidence in support of the plaintiffs' claim that the transaction should be declared a mortgage rather than an absolute conveyance. Williamson v. Frazee, 294 Mo. 320, 242 S.W. 958. But, in trying this cause anew upon this appeal, Bitzenburg v. Bitzenburg, Mo.Sup., 226 S.W.2d 1017, and considering all the circumstances surrounding the transaction, 36 Am.Jur., Secs. 125-158; 59 C. J. S. Mortgages, §§ 18-57, it may not be said that the plaintiffs' have established that this deed should be declared a mortgage. The most that could possibly be said of the plaintiffs' claim is that the oral evidence is in irreconcilable conflict and there are many circumstances corroborative of the defendants' claim, as the court found. Lastofka v. Lastofka, supra; Wright v. Brown, supra; Cohron v. Polk, 252 Mo. 261, 158 S.W. 603.
As to the second count, the plaintiffs alleged that on the first day of March 1943 Thomas and his wife "entered into an arrangement" with Mr. and Mrs. Young whereby Thomas and his wife moved onto the farm and used the farm implements and livestock in farming operations and that they failed to account to Mr. Young for the increase and produce. It is alleged that they sold and disposed of the personal property and refused to account to either the father and mother or the administratrix. It is now urged that the trial court's decree erroneously vests the original capital assets and the net profits "of the joint adventure in farming operations" in Thomas. The plaintiffs now claim that the evidence discloses as to the personal property and farming operations a "joint venture", Groseclose v. Hocking, Mo.Sup., 222 S.W.2d 754, or circumstances giving rise to a resulting trust. Rich v. Williams, Mo.Sup., 222 S.W.2d 726. But again, as it was with the deed, in trying the cause upon the entire record, the most that could be said for the plaintiffs' case is that it is based upon irreconcilably conflicting oral testimony. John testified that from 1929 until 1943 he operated the farm with his father, even though the operations were unsuccessful for the most part. He claimed that there was certain livestock on the farm but Thomas' evidence was that he had paid for any hay or grain there was on the farm and that he had either paid for the livestock or paid off mortgages on it. In short, his evidence accounted for the value of any personal property. But there was no evidence in support of the plaintiffs' claim that Thomas had "entered into an arrangement" with his father and mother to operate the farm on any profit-sharing basis or that they had engaged in a "joint adventure in farming operations." Ewalt v. Hudson, Mo.App., 223 S.W.2d 132.
In its essentials, as to both counts, the plaintiffs' case plainly falls within and is governed by the Lastofka, Wright, Rich and Ewalt cases, and it is not necessary to set forth in greater detail further illustrations of the fact. Accordingly the judgment is affirmed.
WESTHUES and BOHLING, CC., concur.
The foregoing opinion by BARRETT, C., is adopted as the opinion of the Court.
All concur.