New England Loan & Trust Co. v. Browne
New England Loan & Trust Co. v. Browne
Opinion of the Court
This is an action of ejectment for two lots in Kansas City. Plaintiff’s title is derived through a deed of trust executed by Mina Sexton and Warren Sexton, her husband, to John 0. Hall, trustee with power to sell, to secure a bond for $1,800 and interest coupons made by them to the plaintiff, and the trustee’s deed foreclosing the deed of trust.
The defendant set up in his answer what was intended to he an equitable .cross action attacking the validity of the trustee’s sale and the case was tried on that issue. This answer states that the plaintiff’s title is the deed of trust and the trustee’s deed, and avers, that the latter is void because by the terms of the deed of trust the trustee was only authorized to sell in case the grantors were in some default as to its conditions, and “that at the time of the advertising and selling of said premises by said trustee the grantors in said trust deed were not in default of the terms and conditions of said trust deed or any part or portion of the terms and conditions thereof.” That is all there is of the affirmative defense.
Upon the trial the plaintiff introduced in evidence the deed of trust dated May, 1889, the $1,800 bond due June 1, 1894, and past due interest coupons, which deed contained among other things a clause to the effect that any recital in the deed to be made by the trustee thereunder should be taken prima- facie as true; a deed dated 28th March, 1896, from the trustee to Gilbert, reciting default in payment of the bond, a request by the holder to foreclose, advertisement and sale according to the terms of,the deed of trust, and the purchase by Gilbert at the sale; an affidavit showing publication
The whole force of the defense centered in the proposition that Sexton was the' agent of the plaintiff and had authority to make that agreement for extension.
The testimony of defendant tended to show that after he purchased from Sexton the plaintiff had notice of the fact and when the interest on plaintiff’s debt came due notice thereof was sent to defendant Browne. Browne paid his $25 a month to Sexton and supposed Sexton was paying the interest to plaintiff and in point of fact Sexton did so up to about November, 1894, after which he paid nothing, although de
“Q. Whom did you see ? A. I saw Mr. Gilbert, and I may have seen Mr. Hall, too; I also saw Mr. Alexander.
“Q. Who was Mr. Gilbert? A. He is one of the officials of the New England Loan & Trust Company, I think secretary or assistant secretary.
“Q. State what occurred between you and him? A. Why, he told me that note was long past due and the interest past due. I told him that could not be possible, because Mr. Sexton had assured me it would be extended at the time it came due; and I said, ‘When you wrote me last May, I took it for granted that it was all right as I have been making my payments to Mr. Sexton right along, and from your communication I was led to believe that everything was going along smoothly.’ Then I made a note of the amount of interest on the note: ‘Balance due, $22, December 1, 1894; $72 balance due June 1, 1895; $72 balance due December 1, 1895.’
*121 “Q. Prior to that time you bad been paying Mr. Sexton right along according to your contract? A.' Yes, sir; prior to the 20th of February, 1896.
“Q. When you called Mr. Gilbert’s attention to that fact what did he say about it ? A. Mr. Gilbert said Sexton was doing some mighty peculiar things; that he hadn’t paid them the money. I then asked him the question why it was that he had allowed the interest to run that long, as it was unusual to allow interest to run over a year and a half without saying anything about it. ‘Well,’ he said, They were dealing with Mr. Sexton.’
“Q. He said they were dealing with Mr. Sexton ? A. Yes, sir; or words to that effect; I do not mean to give the exact words.”
The only evidence, if it may be so called, of the fact that Sexton was the agent of the plaintiff is the testimony of defendant that Sexton told him so. This was objected to but uppn the promise that other evidence of agency would be introduced the court ruled that what Sexton was said to have said would be received. Then when the plaintiff’s counsel asked the defendant on cross-examination upon what he based his assumption that Sexton was the plaintiff’s agent, he said that Sexton had acted as agent for the plaintiff in connection with some lawsuits before the defendant as justice of the peace. The plaintiff’s evidence as to those lawsuits was that Sexton was connected with a concern that acted as real estate agents, and had procured tenants for plaintiff for some houses it owned, and the plaintiff had one or more suits in the justice court to collect the rents from these tenants, and Sexton attended to those suits.
Against the theory of agency was the testimony of the chief officers of the plaintiff in Kansas City who had charge of its business there, to the effect that Sexton had never been its agent except that he attended to the rent suits above mentioned; that the plaintiff had an office in Kansas City con
The court made a special findingAfor defendant, upon which it based a decree vacating the trustee’s deed under which plaintiff holds, without prejudice to plaintiff’s right to future foreclosure. The special finding is: “Doth find from the evidence that E. P. Sexton was the agent for the plaintiff in the management of the property in controversy, to-wit: [describing it] and for the collection of whatever might be due upon the $1,800 note; that said Sexton received payments upon said note as the agent of the plaintiff and the plaintiff is bound by said Sexton’s action; it is therefore considered,” etc. From that decree the plaintiff appeals.
I. The special finding upon which the decree is based is not responsive to the issues in the pleadings. The sole allegation in the cross hill is that there was no breach in the condition of the deed of trust. The fact that Sexton as agent of the plaintiff received payments on the note, which is all there is of the finding, does not negative the facts that the principal of the debt is due and unpaid and therefore the condition of the deed of trust is broken. Therefore the finding is not sufficient to support the decree.
II. There are really no facts stated in the answer that constitute an affirmative defense or an equitable cross action. The plaintiff claiming under a deed of trust and a foreclosure sale, is compelled to prove that the conditions of the deed of trust were broken before his trustee’s deed can be received in evidence. In this case he proves those facts prima facie by the recitals in the trustee’s deed, because the statute section 1103, Revised Statutes 1889, and the deed of trust itself, make the recitals prima facie evidence of their truth. Rut they are only prima facie evidence, and under a general denial the defendant could introduce evidence to show that the
III. Lastly there was no evidence that Sexton was tbe agent of tbe plaintiff or that be assumed as such to make this alleged agreement of extension. Tbe evidence of tbe written contract is that be assumed on bis own responsibility, if defendant should desire an extension for five years of tbe $1,800 debt, to “procure tbe same without increased expense to said second parties.” It was Sexton’s personal obligation to procure it to be done, which necessarily implied that be could not do it himself. Even if Sexton was agent for the plaintiff he was not professing to so act in this transaction, but was trading on bis own account. Whatever consideration there was for tbe agreement to extend, enured, not to tbe plaintiff, but to Sexton. According to defendant’s own testimony if be bad ever been blinded by Sexton’s misrepre>-sentations as to agency, be bad bis eyes opened as early as May, 1894 when he received a letter from tbe plaintiff calling bis attention to tbe fact that tbe debt was soon to fall due and if be desired to make any arrangement to extend it be was invited to call at tbe plaintiff’s office and attend to it. That letter was a warning to him if be bad ever trusted in the assumed agency of Sexton that bis confidence was misplaced. But instead of replying to tbe plaintiff’s .letter be went again to Sexton -and according to bis testimony was
Some significance seems to have been given to the fact that the Sextons (there were two of them), paid the interest on the note to plaintiff during the period in which it was paid. But that was in regular business course. The two Sextons were in business together, W. B. Sexton and wife were the makers of the $1,800 note and interest coupons; as between them and the plaintiff they were the principal debtors, plaintiff had a right to look to them for payment and they had a right to take up the interest coupons and hold them against the defendant if he was liable under the written contract, above mentioned with E. P. Sexton, as to which we express no opinion. If the defendant had been misled to his disadvantage in this matter it has been through no fault of the plaintiff.
The judgment is reversed and the cause remanded to the
Reference
- Full Case Name
- NEW ENGLAND LOAN & TRUST COMPANY v. BROWNE
- Status
- Published