Locke's v. Palmer , 26 Ala. 312 ( 1855 )

G-OLDTHWAITE, J.

— The first question is, whether the transaction between the Palmers and William A. Locke was an absolute sale, or a mortgage. The first instrument which was executed conveys the title to the property unconditionally, and would, if taken by itself, be regarded as what it appears upon its face to be — an absolute sale. The instrument, however, which was executed in May, 1845, some two months af-terwards, by Locke, recites that it was agreed between himself and the Palmers, at the time of the first conveyance, that if the latter should re-pay to him, by the first day of January next thereafter, the amount of the consideration money expressed in the first deed, then he would re-convey to them all the property therein mentioned. This recital is unquestionably written evidence of the very highest character against the party by whom it was executed, and, although it may not be sufficient to show that the parties intended the first instrument to operate as a mortgage, still, if the other evidence in the cause, taken in connection with it, establishes such to have been the purpose of the parties, or even renders it doubtful whether a conditional sale or a mortgage was intended,' it is enough to induce a court of equity to declare it. a mortgage.—Turnipseed v. Cunningham, 16 Ala. 501.

There are, in most cases of this character, no tests which will enable a court to determine, with anything like positive certainty, whether a mortgage, or a conditional sale, was intended ; but the inclination of equity, in such cases, is always to lean against the latter, for the reason, that an error which converted the transaction into a mortgage would not be as injurious as a mistake which changed a mortgage into a conditional sale ; and this leaning is strongly manifested whenever the contract had its origin in a proposition for a loan, or the relation of debtor and creditor existed between the parties (Crane v. Bonnell, 1 Greene’s Ch. 264; Robertson v. Campbell, 2 Call’s R. 421; Turnipseed v. Cunningham, supra); these circumstances being regarded as amongst the circumstances tending to show' that a mortgage was intended.—Eiland v. Radford, 7 Ala. 724.

Neither of these tests is wanting in the present case; and in addition to these is the fact, that a portion of the articles áre not enumerated in the bill of sale. The purchase appears to have been in gross, without the value of the property in detail being contemplated ; the re-sale is to take place, if the purchaser re-pays the purchase money ; and the buyer, instead of taking possession of the property, allows it to remain with the seller without hire — or at least none is proved — when a portion'of it was such as would readily have commanded hire, and another portion such as would have been liable to injury and deterioration in the wear and tear resulting from its use. All these, and especially the possession of the property remaining with the seller, are inconsistent with the idea of an absolute sale. It is true, that it docs not appear that the evidence of the debt due from the Palmers to Locke before the transaction was retained, or any acknowledgment taken for the money advanced ; but this, though a strong circumstance to show that the relation of debtor and creditor was destroyed, is not conclusive.— Turnipseed v. Cunningham, supra. Upon a careful examination of the whole evidence, we have great doubt whether the parties contemplated an absolute sale. The inclination of our mind is, rather, that security only was intended ; and such being the fair result of the evidence, we are bound by the principles which govern courts of equity in this class of cases, to declare the contract a mortgage instead of an absolute sale.

But it is urged on behalf of the appellant, that, conceding the instrument to be a mortgage, it is shown that John Locke, the executor of William A. Locke, subsequently purchased the equity of redemption in the slaves which were a portion of the property conveyed. The evidence to sustain this position consists of the memorandum of a settlement made in May, 1847, in the form of a debit and credit account, John Locke charging himself with the sales of the land conveyed, and the proceeds or value of other property, some of which is not em-' braced by the deed; and the account is balanced by giving credit of debts against the Palmers. The last item on the credit side of the account is, “Ain’t of Silvy and Oliver, $1168 92.” This account is in the hand-writing of John Locke, and not signed by either of the Palmers. They allege in the bill, it is true, that by a settlement with John Locke they were found in arrears to the amount of $1168 92, and that he retained a memorandum of the settlement; but there is no positive evidence that this is the settlement they refer to, and it certainly is entitled to but little (if any) weight to show that they consented to the last item on the credit side, which is not admitted by them. “ Once a mortgage, always a mortgage,” is the rule that was correctly laid down by the chancellor; and under its influence, when the character of the instrument was determined, the equity of redemption became a necessary incident, and existed with it until it was proved that they had parted with it. The testimony of the witness Boykin shows the virtual admission of John Locke, after the settlement in 1847, of the right of the Palmers to redeem; and the evidence of Dr. Kittrell is not irreconcilable with that right. He was to purchase the slaves from Locke, by assuming the debt then due, and hold them until the mortgagors paid him the money, or until the debt was paid by their hire. This was, in effect, but little more than the substitution of a third person in the place of the mortgagee ; and the close and intimate relations which the same witness proved existed between himself and the Palmers, might have been their inducement for preferring him to become their creditor instead of Locke. Equity looks with a jealous-eye upon sales of equity of redemption to the mortgagee, (Story’s Eq. § 1019, and cases there cited,) and requires them to be established by the clearest and most convincing proof, which is far from having been done in the present case.

Another ground taken against the decree is, that as the contract was entire, the bill should have been filed, not to redeem the slaves alone, but the entire property conveyed. In reference to this, it is only necessary to say, that a portion of the property had been sold, and its proceeds applied to the satisfaction of the debt. If this had not been the case, however, we are of the opinion, that it is at the option of the mortgagor to proceed for the redemption of all or any portion of the property. That he seeks the aid of the court in relation to a part of the property only, cannot injuriously affect the mortgagee, as a decree for the redemption of that part would be a bar to any other proceeding of the like nature upon the same contract.

The statute of non-claim is also urged as a bar to the relief sought. That statute provides, that all claims against the estates of deceased persons shall be barred, unless presented to the executor or administrator within eighteen months after the grant of letters, or within thaf time after the claim shall accrue; with an exception in favor of infants, married women, and claims contracted out of the State.—Clay’s Dig. 195, § 17. We are clear, this statute does not refer to claims of title, for the reason, that claims of such a character cannot, in any just sense, be said to be claims against the “ estate ” of the deceased : on tlie contrary, the right to recover is based upon the fact that the property claimed does not belong to the estate. As to whether the statute would bar the damages arising from the detention of the property as against the estate, it is unnecessary now to determine. The failure to present the claim would not prevent the mortgagee from suing the personal representative of the mortgagor, in an action of detinue, and recovering the property, and at least nominal damages.—Trecothick v. Austin, 3 Mass. Rep. 29; Johnson v. Ames, 11 Pick. 173. In Sims v. Canfield, 2 Ala. 555, the bill to redeem personal property was, in connection with the statute of limitations, assimilated to an action of detinue, and by analogy held to be barred in sis years after adverse possession. The same principle must obtain with regard to the statute of non-claim. The equity of redemption is simply the right of the mortgagor to the specific property after the debt for which it is bound is discharged ■ and in equity he is always considered as the real owner, until he is debarred from his right by judicial decree, or in some other mode.—4 Kent's Com. 13G. The bill to redeem, in the aspect in which we are considering it, is governed by the same principles as the bill to foreclose, and if the latter is not affected by the statute of non-claim, the former cannot be.

The only remaining ground of objection is, that the title to the slaves was proved to be in one of the complainants alone, instead of both of them jointly. But this circumstance, as the -mortgage is executed by them in their joint names, can make no difference. The bill is filed upon the contract as it was made. The mortgagee, by becoming a party to, and accepting the joint instrument, recognized the title of the other party as joint, and having done so, there is no good reason, in a suit of this kind, why he should be allowed to deny it,

Decree affirmed, with costs.