Baldwin v. Golde , 88 Hun 115 ( 1895 )

WARD, J.

The premises sought to be recovered by the plaintiff in this action were village lots 71, 72, and 73, and parts of 69 and 70, in the village of Tonawanda, and also lot 74. All except lot 74 had been conveyed by the owner in possession, in 1884, to Christian Golde, the husband of the defendant Marie, and the father of Cornelius, Herman, and Thomas Golde, the other defendants. Lot 74, in 1885, had been conveyed by the owner to Christian Golde and Marie, his wife, as tenants by the entirety. Christian went into possession of all these lots, under the deeds, and continued such possession until January, 1893, when he sold and conveyed the premises, by warranty deed, to the plaintiff, for a valuable consideration, of $965. The wife and sons of Golde occupied the premises with him, as a part of his family. Christian Golde, after the sale, departed from the state, leaving the family in possession of the premises. The plaintiff demanded possession of them, and was refused, and brought this action to recover the premises. The defendants all answered, alleging, first, that the defendant Cornelius Golde had constructed a house and barn upon the lots after his father had purchased them, and before the deed to the plaintiff, at the cost of about $1,200, under a verbal arrangement with his father that the father should execute a mortgage to him for the cost of the buildings, and until he did so Cornelius was to live on the premises, with his father, free of rent, which should offset the interest that would accrue on the cost of the buildings) that the plaintiff knew of this arrangement at the time of his purchase. The defendants further answered that Christian Golde and the plaintiff had entered into a fraudulent arrangement, whereby the plaintiff was to purchase the premises for less than they were worth, in order to defraud Cornelius Golde of his rights in the premises, and that the said Christian Golde, at the time of the execution and delivery of the deed to the plaintiff, “was of unsound mind, was mentally incompetent to transact business and to deed real property, and was so far deprived of his reason and understanding as to be altogether unfit to manage his affairs, * * *” and that the plaintiff at that time was aware of such condition of Christian Golde, and procured him to execute the deed to the plaintiff for a consideration much less than the actual value, “with intent to defraud such Christian Golde and Cornelius Golde of their respective rights in said premises.” Upon the trial the plaintiff gave testimony tending to show that he was a purchaser in good faith and for value, and had no notice of any claim or equity of Cornelius Golde, or any knowledge or notice of any unsoundness of mind of Christian Golde, and was protected by the recording acts, in his title. The defendants offered to show the contract as to thé buildings, and the verbal mortgage, alleged in the answer, between Christian Golde and Cornelius, without offering to show any knowledge in or notice to the plaintiff of the same. This evidence was excluded, under objections made, and the defendant excepted, and then the defendants offered to show “that, at the time of the execution of the deed from Christian Golde to Arthur J. Baldwin (the plaintiff), he was of unsound mind and incompetent to transact business or to give the deed in question.” This was objected to and excluded, and the defendants excepted. There was no offer by the defendants to prove, or proof given of, any knowledge in or notice to the plaintiff of the matters embraced in this offer. The evidence was closed, and each party asked the court for a direction of a verdict in Ms favor, respectively. The court dismissed the complaint, as to lot 74, and directed a verdict for the plaintiff as to the other lots.

The questions before us come here upon the two exceptions taken by the defendants. The first exception, as to the equitable claim of Cornelius Golde, is clearly untenable. It was a private arrangement between the father and the son, of which the plaintiff had no notice or knowledge. The counsel for the appellant claims that Cornelius Golde was in such possession of the premises as gave constructive notice of his rights. He was living in his father’s family, and, to all appearances, bore only such relations to the property as a son in the family would have who had not departed from the family hearth. The father had the record title, and the inference was that the son’s possession was under him, and in subordination to that title. Pope v. Allen, 90 N. Y. 298.

The other exception is more formidable, and involves a question about which there is confusion in the authorities, and has been much considered and discussed in the courts of this state. The defendants were strangers to the title of Christian Golde, although his wife and children, until his decease. They had no more right to the possession of the premises, as against this grantee, than any other person who might enter upon the premises wrongfully, and hold them against the plaintiff. And the appellants’ counsel here takes the bold position that any person in possession of real estate, even if such possession be wrongful, may hold it against the grantee of one having lawful and record title, by showing the insanity of his grantor, as a fact, upon the trial of an action brought by the grantee who purchases in good faith and for value, and without notice of the insanity; and he cites in support of this position Van Deusen v. Sweet, 51 N. Y. 378. That was a case where a ' parent had deeded to his son-in-law, without consideration, certain premises, and had also devised the same premises, by will, to his daughter. The daughter sued to recover the premises, alleging the deed void to the son-in-law upon the ground of the insanity of the father, and the court held that a deed by one non compos mentis is absolutely void, and, where a defendant in an action to recover the possession of real property claims under such a deed, the fact of the incapacity of the grantor may be shown by the plaintiff, to defeat such claim, although no fraud is alleged, and such incapacity has not been legally or judicially determined at the time. This decision was made by the commission of appeals, and it will be observed that the parties to the action had notice of the mental condition of the father, and neither of them was a purchaser for value. He also cites Goodyear v. Adams (Sup.) 5 N. Y. Supp. 275. That was a family controversy, where one party claimed under a deed, and another under a will, where the mental condition of the grantor was known to the parties, and where there was an allegation of fraud as to the obtaining of the deed. The deed was held void in that case, but the court say:

“It was not shown that the deed was taken in good faith, or for the benefit of the grantor, in any manner, or for an adequate consideration, but obtained by fraud.”

He cites, also, Aldrich v. Bailey, 132 N. Y. 85, 30 N. E. 264. That case came before the court on a submission' of facts as to whether a contract was void for insanity of one of the contracting parties. In referring to the case of Van Deusen v. Sweet, supra, Judge Haight says:

“Assuming, for the purposes of this case, that the rule is there correctly stated, and that a deed would not be merely voidable, but absolutely void, when executed by an insane person, yet under the rule in that case a deed is absolutely void only when it appears that the person executing it was at the time so deprived of his mental faculties as to be wholly and absolutely and completely unable to understand or comprehend the nature of the transaction.”

The judge further says, in speaking of the case before him:

“No allegation appears as to the extent to which the mind was unsound, or as to whether it was so affected as to render him wholly and absolutely incompetent to comprehend and understand the nature of the transaction.”

Judged by this standard, the answer of the defendants falls far short of alleging such a mental condition in Christian Golde as would make his deed void. That answer alleges that he is capable of committing a fraud upon his son, with the plaintiff, and at the same time charges him with incapacity to carry out the fraud. The offer of proof, under the answer we are now considering, falls short of this rigid standard; and we might repose upon this distinction, and sustain the ruling of the trial court without further investigation, but we will consider a few other cases and authorities, and assert what we regard the true rule established by them. But before doing so we will notice another case cited by the appellants, —Valentine v. Richardt, also reported as Valentine v. Lunt (Sup.) 3 N. Y. Supp. 906. In that case, Mrs. Valentine, being the owner of considerable real estate, and an invalid, employed a physician, one Richardt, who obtained such influence over her that he established illicit relations with her, and, by most villainous contrivances and fraud, induced her to deed to him her real estate, and, after recording the deed, borrowed considerable money, on the strength of his record title, of innocent persons, and executed mortgages to them. Upon the death of Mrs. Valentine her son brought an action in equity to set aside the mortgages and deed (making the mortgagees parties), alleging the fraudulent methods of Richardt, and that his mother, when she executed the deed, was of unsound mind, and incompetent to manage herself or her affairs. The general term of the Second department held the deed and mortgages void, even as against the innocent mortgagees. Upon appeal to the court of appeals this judgment was reversed (115 N. Y. 496, 22 N. E. 209), the court holding that the innocent mortgagees should be protected, notwithstanding the fact of the mental condition of Mrs. Valentine, and fraud practiced upon her. Blackstone says (2 Comm. 291) that:

“Idiots and persons of nonsane memory, infants, and persons under duress, are not totally disabled either to convey or purchase, but sub modo- only, for their conveyances and purchases are voidable, but not actually void.”

Kent says (Id. 451):

“The general rule is that sanity is to be presumed until the contrary be proved, and therefore, by the common law, a deed made by a person non compos is voidable only, and not void.”

In Ex parte Beckwith, 3 Hun, 443, the general term of the Fourth department say:

“A contract with a person not known to be of unsound mind, and who has not been found, upon a commission de lunático inquirendo, to be insane, may be sustained if it shall be proved to have been fairly made, and without advantage being taken of the lunatic.”

In Fitzhugh v. Wilcox, Judge Johnson, speaking for the general term of the Seventh district (12 Barb. 237), says, in a case where an alleged lunatic had been a contracting party:

“The distinction between the void and voidable contracts of a lunatic does not appear to be entirely settled, upon authority, but I apprehend that it will be found to be substantially this: that the deeds and contracts of a lunatic, made before office found, are not void, but voidable, while those made after-wards are absolutely void;” citing cases, among, which is Jackson v. Gumaer, 2 Cow. 552.

In Riley v. Bank, 36 Hun, 519, where it was alleged that an insane person had deposited money in a bank, the court say, at page 519:

“An executed contract, made in the usual course of business, and founded upon a valuable consideration, cannot be set aside by one of the parties thereto, nor by his representatives after his death, on the ground of his unsoundness of mind when he received the benefits stipulated in the contract, and the other party has no notice of his incapacity, and was guilty of no fraud or imposition;" citing Insurance Co. v. Hunt, 79 N. Y. 541, and other cases.

This case was affirmed, without opinion, in 103 N. Y. 669.

Many other cases might be cited to the same effect, and the rule the cases establish is this: that the deed or contract of a lunatic, or person of unsound mind, made before inquisition of lunacy found, is not void, where it is executed upon a valuable consideration received by the lunatic, and the other party to the contract or conveyance had no knowledge or notice of his mental infirmities. The burden of proof may be one way or the other in such cases, according to the circumstances; but ordinarily the burden is upon those who allege the unsoundness of mind to establish the facts to avoid the instrument, and the want of equity in the transaction, and notice, to the party dealing with the lunatic, of his mental condition. No transaction with a lunatic is void, unless it is void as to both parties, so that either could assert it. No one would claim that the plaintiff in the case before us could assert the absolute invalidity of the deed he received, and ask for a restoration of the consideration he has advanced for it. The deed, therefore, at best, being only voidable, and the offer of proof as to the grantor’s mental condition not being accompanied by any proof, or offer to prove notice to the plaintiff, the trial court was right in rejecting the evidence, and the exception was not well taken.

The respondent makes a point that the defendants in this case are strangers to the title of Christian Colde, and cannot litigate here the question of his sanity. This position is supported both by reason and authority. It must be remembered that Christian Colde was not dead at the time of the trial, so that any rights that he may have had devolved upon his widow and children. In Ingraham v. Baldwin, 9 N. Y. 45, evidence to show that a mortgagor, at the time he executed the mortgage, was a lunatic, was offered against a mortgagee in good faith, and without notice. The evidence was excluded, and the court of appeals say that the mortgage was only to be avoided at the election of the lunatic or his personal representatives, or those claiming some interest under him in the premises; that a lunatic was not absolutely disqualified from making a contract. And the court concludes:

“Again, there was no privity between the defendant and mortgagor shown, or proposed to be shown. * * * A stranger would have no more right to insist upon the insanity of the mortgagor, to avoid a security executed by him, than upon his infancy.”

The same principle is asserted in Jackson v. Gumaer, 2 Cow. 552.

The questions of fact in the case are all found with the plaintiff by the court, as both parties asked for a direction of a verdict.

The judgment should be affirmed. All concur.