Scott v. Scott , 29 S.C. 414 ( 1888 )

The opinion of the court was delivered by

Mr. Justice McGowan.

On May 21,1885, T. M. Scott was appointed guardian of the person and estate of the plaintiff, Mattie J., who, although grown up, was still a minor, and received of her estate $6,000. On July 23, 1885, the said guardian, with the full consent of his ward, and in order “to provide a home for her,” purchased from one James W. Peak two lots in the town of McCormick, at the price of $1,800. The guardian paid in cash of his ward’s money $1,000, and gave to Mrs. Julia F. Peak, wife of J. W. Peak, his promissory note for $800, signed as “guardian,” for the remainder of the purchase money. Peak made title directly to the plaintiff, and the guardian, for her, executed a mortgage of the premises to secure the note for $800. Both the note and mortgage were assigned for value to John Harmon, sr., and Creighton Bros. Soon after this transaction (the precise time does not appear), the plaintiff intermarried with her said guardian, T. M. Scott, ¹ and they entered into the purchased premises, and for several months occupied the same “as their home,” until they removed to Kingstree, and then they continued to rent it until March 18, 1887, when the plaintiff arrived at the age of twenty-one years ; and thereupon from Kingstree, where she then resided with her husband, addressed a note to James W". Peak, saying: “I was an infant when the contract of July 23, 1885, conveying a house and lot in the town of McCormick to me was made, and was not capable of making any contract. Therefore I think it best to rescind this contract, and hereby give notice, as far as I am concerned, it is at an end. But I am perfectly willing to reconvey to you, upon being paid the money, which was advanced on said contract,” &c. To this note Peak replied that the note and mortgage had been assigned, and he had nothing to do with the collection. Creighton Brothers and Harmon, as assignees, commenced an action against T. M. Scott, “as guardian,” to foreclose the assigned note and mortgage, and sell the house and lot..

Thereupon this action was brought by the plaintiff, Mattie J. Scott, to enjoin the foreclosure suit of Creighton Brothers, to sell the house and lot, and have the proceeds applied to certain costs, and then to the payment to plaintiff of the $1,000 cash paid with interest; and that T. M. Scott and James W. Peak, individually and as executors of Mrs. Julia F. Peak, pay any deficiency. Creighton Brothers, the assignees of the note and mortgage, answered, resisting the relief prayed for, and insisting that they are innocent holders of the note and mortgage, without notice of the plaintiff’s claim; and that the plaintiff, after coming of age, had confirmed the purchase of the house and lot, by retaining possession and receiving the rents thereof even down to the present time; and that it would be especially inequitable to allow her to recover the $ 1,000, without requiring her to account for rents, &c. James W. Peak answered, that he was not in possession of the land, and had no interest therein, as the note and mortgage for the remainder of the purchase money had been assigned, and also relying upon the defence, that the plaintiff had confirmed the contract after attaining her majority. It appeared that, notwithstanding the notice of rescission and the commencement of her action within three months thereafter, the plaintiff, after she came of full age, continued in possession through successive tenants, and is still in possession, exercising the rights of ownership.

Upon the testimony taken by the master, which is in the Brief, Judge Norton dismissed the complaint as to Julia F. Peak, but held that the plaintiff should recover from her late guardian, T. M. Scott, one thousand dollars, with interest, less costs; that Creighton Brothers should also recover from the said T. M. Scott eight hundred dollars and interest; that upon failure to pay by a given day, the house and lot should be sold, and, after the payment of certain costs, the proceeds should be paid out, first, on the amount adjudged to the plaintiff, and, second, on the amount adjudged to Creighton Brothers, &c., Thomas M. Scott to be entitled to the surplus, if any.

From this decree both parties appeal — the plaintiff, “Because his honor held that the defendant, Julia F. Peak, w'as neither a necessarjr nor a proper party to the cause, and awarded defendants costs against the .plaintiff ”

The defendants’ exceptions : “I. Because it was error to hold that the plaintiff's retention of the house and lot described in the complaint was an equitable mortgage. II. Because it was error to hold that plaintiff did not ratify the purchase of said property, after she attained her majority, by her repeated acts of ownership and receipts of rents. III. Because he should have found that defendants did not know that plaintiff’s money was used in the purchase of the house and lot by T. M. Scott. IV. Because he should have held that the proceeds should be applied, first, to the payment of the note and mortgage for balance of the purchase money. V. Because he adjudged defendants to pay costs,” &c.

It is probably true that the purchase of the house and lot in McCormick, to “secure a home for the plaintiff,” was made witlt her full consent and approval.. She had then reached the age of discretion, and was about to marry. But in law she was still a minor, and the guardian could not invest any of her money in real estate without the permission of the court. It may also be true that the court, if applied to, would, under the circumstances, have given such permission ; but it was not done, and therefore the purchase was without authority. The transaction, however, was not absolutely void, but voidable. The plaintiff, in strictness, had the right, upon reaching her majority, to confirm or avoid it. She brings her action now to avoid it, and the main question of the case is, whether, by her acts, she confirmed it after she reached her majority. Ihley v. Padgett, 27 S. C., 300. Confirmation is a question of intention, and whether that intention exists or not must generally be inferred from circumstances. In a note to the case of Ihley v. Padgett, supra, in the Southeastern Reporter (8 vol.,471), the principle is thus stated: “If an infant continues, after arriving of full age, to occupy a position, which is only explicable upon the supposition that he intended to stand by a contract executed during minority, such contract will be deemed to be ratified. Durfee v. Abbott, 28 N. W. Rep., 521.”

Did the plaintiff by her acts, after coming of age, occupy such a position ? Was her continued possession “only explicable upon the supposition that she intended to stand by the contract” ? We incline to think it would have been sufficient if it had stood alone and unexplained. But we cannot overlook the circumstances, that upon reaching her majority she promptly notified her recision, and within three months thereafter brought her action for that purpose — most of the acts relied upon for confirmation having been done while the action was actually pending. Besides, some of her money had been advanced on the purchase of the property, and her retaining possession may have been for. the purpose of securing that advanced. We cannot, therefore, say that the plaintiff’s continued possession was “only explicable upon the supposition that she intended to stand by the contract.” Her written notice of rescission and the action itself negative that view.

It is further insisted that the judge should have found that defendants did not know that plaintiff’s money was used in the purchase of the house and lot; and he should have held that the proceeds of the sale should be applied first to the note and mortgage for the unpaid purchase money. All that the judge said about notice was this: “The only evidence that Julia F. Peak and Creighton Brothers had any notice that T. M. Scott had used $1,000 of plaintiff’s estate in the purchase, was the manner of the signature to the note and mortgage and the record of the deed to plaintiff,” &c. And therefore he dismissed the complaint as to Julia F. Peak, and gave a decree in favor of Creighton Brothers, as assignees of the note and mortgage, against Thomas M. Scott for $800 and interest, to be paid from the proceeds of sale after the decree in favor of the plaintiff was paid. It seems to us that Creighton Brothers have no right to complain of this. If the transaction had not been set aside as made during the minority of the plaintiff, we do not see that the note and mortgage, which they held as assignees, being signed by Scott, with the addition to his name of the word “guardian,” would have bound the house and lot, the title of which w'as in the plaintiff But as the transaction was rescinded, the plaintiff, who had titles to the property ordered to be sold, had the highest equity, as a mortgagee in possession, to be refunded the advance made out of her money in the abortive purchase. We cannot say that it was error to order the plaintiff to be first paid.

There was no evidence that Mrs. Julia F. Peak was present when her husband, James W. Peak, negotiated the sale to Scott, or that she had anything to do with the transaction, except to receive the note and mortgage made to her, and to assign the same. We cannot affirm that it was error in the judge to dismiss the complaint as to her.

In a proceeding in equity, costs follow the event of the suit, unless otherwise directed by the presiding judge, as a part of the relief intended to be granted; and in such cases this court will rarely disturb the direction.

As the plaintiff exercised her right to have the purchase of the house and lot declared void, we think the order of reference made by the judge as to the rents and profits since March 18, 1887 (when the plaintiff attained her majority), should be so enlarged as to cover the whole period from the time she and her husband took possession in 1885.

With this modification, the judgment of this court is, that the judgment of the Circuit Court be affirmed.