Mohr v. Griffin , 137 Ala. 456 ( 1902 )

ITAKALSON, J.

The facts of the case are substantially, that prior to' the 1st day of April, 1899, the 'Complainant, Ada J. Griffin, a married woman, the wife of J. E. Griffin, owned and possessed 610 acres of land described in the bill, lying in Bullock county, on which she and her husband resided; that the complainant purchased the lands from her father, J. E. Hightower, in October, 1897, and he made her a deed thereto, but there remained due and owing to’ said Hightower on the purchase money for said land, the sum of $803.07, to secure AAdiich she had promised to give him a mortgage on the lands. Mrs. Griffin had borroAved $1,600, — a part of the money with Avhich. to pay her father for the lands,— from the American Freehold Mortgage Company of London, and also the sum of $128 from the Land Company of Alabama, to secure AA’hich, she- and her husband liad executed mortgages on said lands to said companies respectively, AA’hich sums, together AAdth the $803.07, aggregated $2,537.07 she OAved on the lands besides wha,t interest there may liaA’e' accumulated. J. E. Griffin, the husband of complainant, had been cultivating these lands under lease from his Avife, for several years prior to 1898, and OAvned the stock and personal property Avith Avhich he did the farming. He procured advances to make the crops in, these years from the defendant, M. Mohr, of Montgomery, and to secure him therefor, mortgaged 'to him from year to year the crops to he groAA’n on the lands, and all his, personal property, including the mule-s and horses, etc., Avith AAdiich he ran the farm. On the 1st of April, 1898, the debts AAdiich said J. E. Griffin owed the defendant on these several mortgages, amounted to about $1,445. Defendant had refused to make further advances. Griffin Avas anxious and concerned to- he put in position by AAdiich he could secure.' advances, and HightoAver was concerned to collect his $803.07, due him on the land, or to have it secured. They came to Montgomery to see defendant, and as a result of a conference between, them, according to defendant’s viMon of it, AAdiich thei evidence, tends to support, defendant stated that he was willing to pay the debt Mrs. Griffin owed’ HightoAver on the land, and sell and transfer to her the debts h:e held against her husband, J. E. Griffin, secured by the mortgages referred to, amounting to about $1,445, AAdiich, with "the $803.07 she OAved to Hightower, aggregated $2,248.07, if Mrs. Griffin Avould execute to him a mortgage on her said lands to secure the payment of said sum. Whether defendant or said HightoAver and Griffin proposed this arrangeuienit does not certainly appear, hut it can make no difference Aldrich, as it Avas no more than- preliminary negotiations for an arrangement to he carried out in the future, if consented to. Some month or six weeks after this conference, and on the 1 April, 1898, J. E. Griffin and his wife, the complainant, came to Montgomery to siee the defendant, Avith the view of carrying said proposed arrangement into effect. After their arrival, they conferred Avith defendant, and as a result, they repaired with him to the office of the attorneys of defendant, to which place also the attorney of Griffin, with whom Griffin had already' conferred, was invited. The most of the business day was spent at this office in talking over the proposed arrangement, and in the preparation of the several papers that Avero executed on the occasion, carrying into effect the agreement that was reached. The first paper was a mortgage, by Mrs. Griffin, joined in by her husband, on said lands to secure a note by her and her husband, of the samé date, for $2,248.07, payable on the 1 April, 3 903, with five interest notes for the interest for each year payable, respectively, on the 1 April each year thereafter, the last note, for $60, being payable on 1 April, 3 903. The mortgage recited that the indebtedness Avas from complainant, Mrs. Griffin, to defendant, loaned to her by him. It provided that on default in payment of the interest as it became due on said notes, at the option of the defendant, the mortgagee, the Avholr sum of money secured should become due and payable and the mortgage liable to foreclosure: It also recited, that it Avas given subject to 'the prior mortgage of said two loan companies. Tbe second Avas a paper, by which it Avas arranged, that if the mortgage Avas not paid at maturity, it might on conditions mentioned ¡therein be extended for another five years, making it ten years in Avliich Mrs. Griffin might, if needed, and conditions Avere complied Avith, he indulged by defendant, in the payment of her said mortgage debt and interest. This contract was signed by the complainant and the defendant, by' and Avith the consent of J. E. Griffin, the husband of complainant.

There was, at the same time, executed by the complainant and the defendant, with the Avritten consent of complainant’s husband indorsed thereon, another agreement, reciting the execution and delivery by complai'nant to defendant, of said mortgage, the object of which;' as it appears on its face, was to put- in written form, and not to leave it open for dispute, what was the real ..on-, si deration on which said mortgage, and the’contract between the parties in reference to ithei same had been executed. It appears, as plainly as it had been written out on the face of the1 paper itself, what the real purpose and agreement between the parties were, so as to preclude any dispute in reference thereto, such as we have before us now. The paper recited: “It is understood and agreed between the said Ada J. Griffin and Michael Mohr, that the said consideration [of the mortgage] is 'composed as follows: Eight hundred and eight dollars and 3-100 ($808.03) which was advanced in cash this day by the said Michael Mohr to the said Ada J. Griffin, for the purpose of paying the same to J. E. Hightower, in payment of the balance due him by the said Ada J. Griffin, as purchase money for the lands so mortgaged by the said Ada J. Griffin to the said Michael Mohr; fourteen hundred and forty and -1-100 dollars ($1,440.04) for the purchase by the said Ada J. Griffin from the said Michael Mohr of certain indebtedness, amounting to said sum, due to the said Michael Mohr by the said J. E. Griffin, which said indebtedness is secured by certain mortr gages on the property of J. E. Griffin. The claim held by the said Mohr against the said J. E. Griffin, has! this day been transferred to the said Ada.-J. Griffin, and the said sum of fourteen hundred and forty and 4-100 dollars ($1,440.04) is the amount agreed to be paid by her in payment, of said transfer.”

As if this were not enough to foreclose all dispute as to the transaction, a. receipt was, at the same time, executed by complainant to defendant acknowledging the delivery to her by defendant of seven different mortgages by J. E. Griffin: to defendant, in different amounts, the first for the year 1894 for $600, and the last, dated January 5, 1897, and payable on the 1st of September, 1897, for $1,445, together with the notes mentioned in each mortgage, which receipt stated: “All of said papers have this day been sold and transferred to me by the said M. Mohr, and which were held by him'to secure an' indebtedness due by the said J. E. Griffin to Mm, amounting to the sum ot‘ $1,440.04, which said indebtedness has been sold and transferred ¡to me this day by the said M. Mohr, together with the above described papers.”

Mr. Weil, the, attorney who. prepared the papers for the parties, as he was instructed by them to do, testified that each of said papers aa as signed in his presence by the parties purporting to' have signed theta; that they were all read over and explained to Mrs. Griffin and her husband wlu> were present; that Mr. J. JD. Norman, an attorney from Union Springs, was present at the time, and examined the papers for Mrs. Griffin before they Avere signed. He also' testified, that nothing was said by defendant in his presence either to Mrs. or Mr. Griffin in reference to the execution of the papers by Mrs. Griffin, as surety for her husband’s debt, and that witness explained to complainant and told her what the papers Avere; that he delivered to Mrs. Griffin the paper's mentioned in the receipt at the time she executed the same.

In this connection it may be stated that Mr. Norman; Avho Avas present at the office of defendant’s attorney the day the papers Avere prepared, Avas examined by the complainant and-he testified as to these papers: “After the papers were handed me, I took them and Avemt to'one corner of the room * * * and read them over. I explained the papers to both of them [Mrs. and Mr. Griffin], and told them, that one was a mortgage given by Mrs. Griffin on her land to secure tire debt described in it, which amounted to something OArer $2,000; and that the effect of the papers Avas, that Mr. Mohr Avas transferring to Mrs. Griffin a debt, which he claimed against Mr. Griffin; and I stated that if that AAras the agreement between them, the papers were properly prepared. I also explained the effect of the agreement which Mr. Mohr Avas to sign in reference to the extension of the debt for several years, and after explaining to them the papers which had been handed to me, I told them the papers Avere clraAvn up in accordance Avith what Mr. Griffin bad told me was the agreement.” He stated furtheir, that he did not remember seeing the papers signed, and his recollection was, that he left the office before they Averei signed.

It was shown, that on the same day after these papers were executed, complainant borrowed from L. Beruheimer in Montgomery, $300, and executed to him a mortgage on the stock and personal property she: had acquired that day from defendant. Mrs. Griffin so testified, and Mr. Bernheimer testified that he asked her at the time-, how she came into the possession of the property, and she stated, that she had bought it from Mr. Mohr by giving a mortgage to him on some land, which statement was found to be true, and he let her have the money. An effort was made to show that she did not borrow this money, but that her husband did, but it was futile. The mortgage is attached to Bernheimei-'s testimony, signed by complainant first, and her husband afterwards, and the overwhelming weight of the evidence shows it was Mrs. Griffin’s transaction.

'The defendant introduced three letters purporting to have been mitten by Mrs. Griffin to. defendant, the fiist without date, in which she stated that she desired to purchase from him the indebtedness of her husband to him, to the amount of $1,250.50; that she could not pay cash., but would give him security by a second mortgage on her land. This was accompanied by a postcript, in which she explains more fully her desire, and says she sends him the numbers of her land, so that, he could have 'the mortgage prepared and sent to her, promising that she would execute and return it.

The other letter was dated November 26, 1897, written by her to defendant, stating that she wished to purchase from him the indebtedness of her husband to him, and the papers he held against him, that she could not pay cash hut could give satisfactory security by a second mortgage on her land, and that Mr. Griffin would explain the matter to him fully.

When these papers were shown to. her while she was being examined, and after examining them, she testified that she signed them, and as to the last one, she stated she wrote and signed it. Afterward, on rebuttal, after much questioning, she stated she did not sign the one first referred to. Mr. Griffin testified that the letters related to a proposed effort to borrow the amount from the Loan Company.

The complainant filed this: bill on the 15th April, 1901, making said M. Mohr and her husband, J. E. Griffin, parties defendant. She attacked the mortgage of complainant to defendant as having been procured from her by the fraud of her husband and defendant in having said debt of $1,445 due by the husband to defendant transferred and assigned to her, and included in the note given by her to defendant; avers that she was under the dominion and control of her husband, and that defendant told her at the time that she was simply signing as security for her husband until he could pay the debt. The prayer of the bill is, that the several notes and mortgages of J. E. Griffin to defendant, Mohr, transferred by the latter to complainant, and which are alleged to be in possession of said J. E. Griffin, may be decreed to be ordered to be returned to said Mohr, and that her mortgage to said Mohr be corrected by excluding therefrom the indebtedness recited therein, except the debt to said Hightower, for $803.07, which she offers to pay to defendant, and as for which said mortgage is not sought to be cancelled or corrected.

The defendant Mohr filed his answer in which he denied the. material allegations of the bill, and averred the bona fidcs of his mortgage and that the same was freely and voluntarily executed by complainant, without any fraud or misrepresentations on his part; that the same was not given as a security for the debt of complainant’s husband, but for the purchase by her of her husband’s indebtedness to him, and for the amount advanced by him to pay her indebtedness to: her father, J. E. Hightower. He also filed his cross-bill against complainant and her husband, J. E. Griffin, setting up said mortgage, and default in the payment of the interest notes, except the first one, $119.84, and praying for a foreclosure of the same.

The chancellor on a submission of the cause and pleadings, and proofs, decreed that complainant ivas entitled to relief; that the debt secured by the mortgage from complainant to respondent, Mohr, except the: amount of the purchase money paid J. E. Hightower by him for complainant, was the debt, of the husband, J. E. Griffin, and that complainant gave said mortgage as surety for the same, and as to that part of said debt, said mortgage was void, and was ordered cancelled, bnt should stand as security for the purchase money advanced by defendant, Mohr, to complainant for said Hightower.

The complainant’s insistence in ¡the case is, that she did not purchase the mortgages or claims of defendant, Mohr, against her husband, and to the extent of said debt which was.included in said mortgage, was a security for her husband’s debt and void; that though said mortgage is in form a. ‘transfer, she was under the dominion and control of her husband and was unduly influenced by him to make, the same; that he and defendant, Mohr, perpetrated a fraud upon her in having said debt of $1,445, so due by her husband to Mohr, transferred to her and included in the note she made, and she did not freely and voluntarily execute the same.

As to the fraud she deems it necessary to aver her husband practiced on her, we may say, it does appear that her husband desired her to execute said note and mortgage, although he1 now lends himself to making the defense by his wife, that in so doing he. perpetrated a: fraud on her. It is difficult to perceive his motive in practicing such a fraud on her. He owed the debt and she knew that fact; he could not readily procure advances to cultivate the farm without giving security; all he had was tied up under his Mohr mortgages, and one can well see why, in oidor to cultivate the farm he would desire to remove this impediment out of his way, and why complainant should be willing and even anxious to assist him in doing so, especially if in purchasing the securities against, him, she might- get five, years, or even ten, in which to py\T them. That such a deal was effected with Mohr, does not. certainly appear to have been so injudicious a transaction aisl to- appear unconscionable: or (wen unreasonable on its face. From the husband’s standpoint, it appeared to he the wise thing to do. If not, why did he counsel if? There was no consideration accruing from Mohr to him, for him to do so; and from Mrs. Griffin’s point of view, she might also, have regarded it as well and wise to accomplish the trade on such terms. But, aside from this, there is no sufficient, evidence to sustain the charge of fraud, either on lier husband’s part or on Mohr’s. There was nothing concealed, the whole transaction ivas laid bare to her and fully explained by the attorneys on both sides, — the one representing Mohr, and the one employed to represent her and her husband’s interest. About ■the only tiling of importance relied on is, that as alleged, she was young and inexperienced and her husband urged her to sign the mortgage, Avhile she hesitated to do so, and that Mohr told her if she signed, it Aims but going-security for her husband. There is no evidence that she kneAv the' difference, at the time, between buying the debt, and standing security for it. Such an assurance from Mohr could scarcely, have had influence with her, unless she kneAV or was. informed that she could not stand her husband’s security, and if she did so, the undertaking Avould be void. Mohr knew the difference, and it does not seem reasonable, that he would have made such a statement, while he was doing his best to avoid such a result by having everything that was done written out and fully explained before, a paper Avas signed. Mohr denies he made such a statement. His attorney AA’ho was present, all the time denies that it Avas made, so far as lie heard; he read over the papers to her and explained their legal import, and so did the attorney of lierscdf and husband; and that she aatis fully and fairly advised of Avliat she was doing, abundantly appears from the oral testiknonv as well as from the several papers she signed. The utmost caution seems to have been taken to have everything understood and to leave nothing open to dispute, so far as well and plainly written documents could foreclose it. Moreover, it does not appear that Mohr ever participated in any fraud or undue influence exercised by the husband OArer complainant, if he did exercise any, to induce her to sign said mortgage Avithout Avhich she is not entitled to the1 relief she seeks against him. — Pratt L. & I. Co. v. McClain, 135 Ala. 452; 33 So. Rep. 185.

As to the other defense, that the making of said mortgage was a mere security by her for her husband, and that she did not purchase his debt of Mohr, it may be said, that there is no reasonable ground for such a contention within the evidence hut is against its overwhelming weight. If there Aims no fraud in the execution of the papers referred to, of Avhich we have said, there is no satisfactory evidence, the question of what the parties intended is absolutely settled by the Avritten documents referred to. As for the capacity of a Avife 'to buy a debt of her husband, the question has long been settled Avith us. In, a late case, First National Bank v. Moragne, 128 Ala. 161, in. speaking of the .power of the Avife over her money, it Avas said of the facts in that case, applicable here: “Being her money, she had a right to give it aAvay to her husband or anybody else, and to apply it by her own hand or through her husband directly to the payment of his debts; for Avhile the Avife may not become the husband’s surety, and may not pledge her property to secure his indebtedness, and her property cannot be taken for his debts, it cannot be doubted that of her oavu volition she may apply it .to the absolute payment of his debts. — Hollingsworth v. Hill, 116 Ala. 184.” Glidden v. Powell, 108 Ala. 621; Pratt L. & I. Co. v. McClain, supra; Villa Rica L. Co. v. Paratine, 92 Ga. 370; 2 Beach on Contracts, § 1308.

The mortgage on its face showing that it Avas made to secure the debt due to the mortgagee, Mohr, by the complainant as principal and not. as surety for her husband, AA’hich suretyship the defendant denies, the burden of proving the debt was that of her husband and that she Avas his surety in the execution of the instrument, Avas upon the complainant, Avhich burden she has failed to discharge. — Lunsford v. Harrison, 131 Ala. 263; Gafford v. Speaker, 125 Ala. 498.

Section 2529 of the Code providing that husband and Avife may contract Avith each other subject to the rules of law as to contracts by and'between persons standing in confidential relations, has no application to this case as to complainant’s contract with Mohr, but. refers solely to contracts by which the husband or Avife obtains from the other some personal interest or acquires some enforceable obligation or advantage of the other. — First Nat. Bank; Nelson, 106 Ala. 535.

Our conclusion is that the chancellor erred in the decree rendered in favor of tbe complainant in tbe original bill, and in denying relief to defendant, Mohr, under bis cross-bill.

Reversed and remanded.