Moran v. Neville ( 1897 )

Grey, V. C.

The exceptions to the master’s report are based upon the same grounds set up in the answer of the excepting defendant, Butterly. He contends that the Jackson avenue property was included in the mortgage of 1890, with the Randolph avenue property, solely as a collateral security, and that it should respond to the payment of that mortgage only in the event that the proceeds of the Randolph avenue property should be insufficient to pay it.

The attention of the mortgagors in making the mortgage of 1890 was evidently especially called to the relation of the mortgage debt to the properties mortgaged. This appears from the clause in that mortgage providing that the mortgagors should have a right to a release of the Jackson avenue property upon paying $1,500 of the principal due. Had they intended that the Jackson avenue property should only be secondly liable for the mortgage debt, it would naturally and reasonably have been expressed in the mortgage itself. It is not there found.

By the exceptant’s proofs it was shown that Robert Neville, in his lifetime, negotiated the loan which resulted in the mortgage of 1890 on both the Jackson avenue property, which he owned, and on the Randolph avenue property, which he obtained to be put in the name of his wife, coincidently with the making of the mortgage. Sometimes he paid the interest on it and sometimes his wife paid it. No proof was made that there was any understanding or agreement that the mortgage of 1890 on both lots should be paid in the first instance wholly out of the Randolph avenue premises.

It is admitted by the answer that the wife, Bessie Neville, holds the title to the Randolph avenue property, and that she received the money raised by the mortgage of 1890 on both properties, and used it for improving her separate estate.

The exceptant appears to have assumed that this receipt of all the mortgage money by Mrs. Neville has operated somewhat as does a resulting trust, and has charged her property with an equity to answer first for the whole mortgage debt. But-obviously this was not the intention of the parties.

The evidence for the defendant Bessie Neville is full and uncontradicted that Robert desired to dispose of the Jackson avenue property in order to have the Randolph avenue property free from liens, with the title to stand in his wife’s name, so that she should have a home clear. Failing to secure a sale on advantageous terms he made the mortgage in question. He made this statement to a Mrs. Lane, and also to the mortgagee, before the mortgage was made, and in substance to the other witnesses afterwards. Robert Neville and Bessie, his wife, never had two purses; he furnished the money to pay the interest on the mortgage of 1890, which covered both properties. The checks given by the mortgagee in making the original loan are produced, and they are made payable, not to the husband, but to the wife, and as he negotiated the loan and transacted the business it is impossible to refuse to believe that he arranged and intended the Randolph avenue property to stand in his wife’s name, and actually gave to her as a gift all the proceeds raised by the mortgage of 1890, which was not only on her property, but also upon his own. This was in the nature of a gift to her actually executed by the making of the mortgage and the payment of the proceeds to her. The heirs of Robert, by their contention, are now seeking to dispute his executed gift.

This testimony explanatory of the purpose and intent of Robert Neville in his dealings with the Randolph avenue property, and with the money raised by the mortgage of 1890, and his declaration regarding these matters, was objected to as incompetent.

But testimony of like character to establish a trust in the Randolph avenue property in favor of Robert Neville, by the admissions of Bessie Neville, would have been admissible had such proofs been offered. Peer v. Peer, 3 Stock. 439; Midmer v. Midmer, 11 C. E. Gr. 302, affirmed on appeal, 12 C. E. Gr. 548. And it may be overcome by the same kind of evidence. Peer v. Peer, ubi supra; Duvale v. Duvale, 9 Dick. Ch. Rep. 582. I think the evidence above recited of the contemporaneous declarations of Robert Neville is within the same principle, and was, under the authorities cited, clearly admissible to show that by the mortgage of 1890 he intended to charge the Jackson avenue property not as an ultimate resort, but primarily, at least, to the extent of paying its fair proportion of that mortgage debt.

Irrespective of aiding proof, however, the mere fact that the husband pays the consideration for the purchase of lands, and has the conveyance made to his wife, raises a presumption that a gift or settlement is intended, and while this presumption may be rebutted by proof, the burden is upon the party who disputes the gift, and the proof must be such as would be required to establish a resulting trust. Read v. Huff, 13 Stew. Eq. 234. I think the principle is equally applicable where the husband obtains a title to be put in his wife’s name, and mortgages his own property with hers to pay for it, actually giving to her the money raised on the mortgage. This completed the gift, and casts upon the heirs who assert an equity antagonistic to the gift the burden of proving that she was to pay back the money by the process of charging the whole debt on her property, and making his liable only for the deficiency. This burden the heirs have not assumed, for they have offered no evidence which shows that the Jackson avenue property should respond in payment of the mortgage of 1890, only after the Randolph avenue .property is exhausted.

Neither the mortgage itself nor the parol testimony supports this contention in the least degree, and, as above shown, the presumption which arises from such dealings of a husband with a wife is also against the exceptant’s contention.

The master has reported that the Jackson avenue property should be charged with the payment of $1,649.50, part of the mortgage of 1890. No exception has been taken to the report on the ground that this is a charge of an undue proportion. The exceptions are made upon the single ground that the Jackson avenue property should not respond at all until after the Randolph avenue property has first been exhausted.

I am of the opinion, and will advise, that the exceptions to the master’s report have not been sustained, and should be overruled, and the report confirmed, with costs.