Bingham v. Thompson

4 Nev. 224

• Court: Nevada Supreme Court
• Decided: July 1, 1868
• Status: Published

Opinion

By the Court,

Lewis, J.

The doctrine that an absolute-deed, when given as security for a loan of money, will be treated as a mortgage in equity, and a recon-veyance decreed to the debtor upon payment of the debt, is now very well established by' the authorities. This doctrine of the equity Courts, it is said, is not opposed to the rule of law that parol evidence is inadmissible to contradict or vary a written instrument ; for when a deed absolute is decreed to be a mortgage it is done not upon" evidence contradicting the written instrument, but upon proof of such facts and circumstances as will create an equity superior to the deed itself. Thus, if it be shown that the grantor was induced by a promise of reconveyance to execute an absolute deed as security for a loan, the proof of that fact would not necessarily contradict the letter of the deed, but it would establish an equity of redemption in favor of the grantor; and so a deed absolute on its face would be controlled in its operation not by evidence contradicting its terms, but by means of an equity superior to the instrument. (Note to Thornburgh v. Baker, Leading Cases in Equity, 873.)

But in all cases of this kind when the defendant by his answer denies the facts by which it is sought do control the operation of an absolute deed, the proof on behalf of the plaintiff must be clear, satisfactory and convincing. A bare preponderance of evidence ought not to be sufficient to defeat the natural effect of an instrument deliberately and freely executed. There is at least a strong' presumption that persons intend that which is the necessary or natural effect of any instrument voluntarily executed by them. When an absolute deed is given by a person of sound mind, it is to be presumed that the grantor intended to make an indefeasible conveyance. If, therefore, one who has executed such instrument seeks to give it an effect different from that which would naturally result from its terms, it is but just that he should be required to produce convincing proof of the facts and circumstances which are to produce that result.

The Courts, too, have always been very reluctant to interfere with or set aside the legal title to real property; and indeed it is safe to say they never do so except when the evidence upon which they act is perfectly satisfactory, after giving to the muniments of such title due weight and consideration. In cases of this kind-, therefore, the right to redeem is decreed only upon proof which leaves no doubt upon the mind as to the justice of such decree. In the case of Franklin v. Roberts, (2 Iredell, Eq. R. 560) this language is used by the Court: “ When the answer denies the right of redemption, the proofs must be clear, consistent and cogent, composed of circumstances incompatible with the idea of an absolute purchase, and leaving no doubt on the mind.. So in the note to Thornburgh v. Baker, supra, it is said: “The evils which this course of decision might otherwise produce are diminished or obviated by the well-settled rule of equity, which requires those who seek to control a written instrument to make out their case by clear and convincing proofs, and will refuse to make a decree in opposition to the denials or allegations of the answer in response to the bill, unless they are overborne by the testimony of more than one witness, or manifestly at variance with the facts and circumstances disclosed by the pleadings and evidence.” “ When,” says Starkie, “ a party at the time of executing a deed pointed out a mistake which the other agreed to rectify but afterwards refused to do so, parol evidence of the fact was held to be admissible on the ground of fraud. Such evidence ought not, for obvious reasons, to be allowed to prevail unless it amount to the strongest possible proof (3 Starkie on Evidence, 1019. See also Stein v. Shack, 1 Watts and Sergeant, 201.)

Assuming this to be the rule, it only remains to determine whether the evidence on behalf of the plaintiff in this case is so cogent and convincing as to leave no doubt on the mind that she is entitled to a decree.

In our judgment the testimony is not only not sufficient to war? rant a decree in favor of the plaintiff, but is overwhelmingly in favor of the defendants. Before referring specially to the evidence it may be well to state that the suit is brought for the purpose of obtaining a decree adjudging a certain absolute deed, executed by the plaintiff to the defendant Braden in the month of June, 1866, to be a mortgage, and giving to the plaintiff the right to redeem the premises so conveyed. As a foundation for this relief it is claimed that the money advanced as a consideration for the execution of the deed was simply a loan, to be repaid at the end of three months ; and that Braden agreed at the time of the conveyance to reconvey the premises upon the payment to him of the money, with interest, and that the plaintiff was induced to make an absolute deed by the representations of Thompson, who it is claimed pretended to act as the friend of the plaintiff in the transaction, and persuaded her that Braden, being an honest and honorable man, would reconvey, in accordance with their mutual understanding; that Braden was Thompson’s friend, but entirely unknown to the plaintiff until the time of the execution of the deed. It is also claimed that the money loaned was, in fact, furnished by Thompson — that he was the- real party in interest, and that the deed was obtained solely for his benefit. The land in question having been conveyed to Elizabeth J. Thompson, (the wife of the defendant, J. M. Thompson) very soon after the. conveyance by the plaintiff to Braden, she is now the holder of the legal title — charged, however, according to the plaintiff’s testimony, with notice of the nature of the conveyance to Braden, and the circumstances under which it was made.

It may be conceded that these facts, if supported hy sufficient proof, would entitle the plaintiff to the decree sought by her; but as we have already -stated, the great weight of evidence, even-, without considering the deed, is upon the side of the defendants. It must be admitted that the plaintiff testifies fully, positively and minutely to all the facts necessary to support her case, and her evidence is, in some measure, corroborated by her sister, w-ho tes-tilled in this manner with respect to the agreement to" reconvey : “ I was present at the time of the execution of the deed of the land in dispute, by plaintiff to the defendant Braden. Besides plaintiff, defendant Braden and myself, I do not remember of any one else being- present except Mr. Denson, who took the acknowledgment of the deed, and the defendant J. M. Thompson.- I do not remember that anything w-as said or done between plaintiff and Thompson or Braden, at the moment of the signing of the deed. I do not know of any agreement between the parties relative to ■the subject matter of this suit, entered into at the time of the execution and delivery of the deed. Nor do I know of any agreement between them other than that which I will presently mention.”

“ For some time prior to the time of the executioñ of the deed the defendant J. M. Thompson was in the habit of visiting the plaintiff and myself at her house. He professed great friendship for ns, and expressed a deep interest in our success and welfare. He very often mentioned the Excelsior Mines, and spoke in high terms of the business advantages of the place; read letters to us purporting to have been written there; told us he was going there, and urged us to go also and commence business, and proposed to aid us when there. We were disposed to act on his advice, but had not the means to justify going. We so-informed him, and he proposed to assist us in that respect also. Thompson told the plaintiff that he had not as much money to spare as she wanted, which was three hundred dollars, but that there Avas-a man Avho had been chopping wood for him Avho could raise some money, and he could get him to furnish her some.' He thought the man could raise then about two hundred dollars — that he himself Avould advance forty dollars, and the remaining sixty dollars could be sent through the express, and that they would give a note for that sum. Thompson said he had lost some money, I don’t remember how pouch, and that it had- made him very cautious about his money, and that he Avould have to have very good security. That he could get the man to take.the land in question, deeded as security, but that he Avould not take a mortgage. That the plaintiff would have to give him a deed, and AA’hen she paid the money and interest, she A\;ouId have the deed back. I think Thompson gave the name of Braden for the man he spoke of. The plaintiff said she was willing to give five per cent, per month for the money. I told plaintiff that Mr. Thompson Avas our friend, and persuaded her to give the deed. Thompson said that he would see that a deed would be executed by Braden to her when she paid the money and interest, and Avould stand security for it. Plaintiff agreed to Thompson’s proposition, and he Avas to bring the man Braden the next day. The next day Thompson came to plaintiff’s house, and a man came with him whom he introduced as Mr. Braden, .and said he was the man he had spoken of -who Avas to loan the money. Plaintiff Avas at the time ill, and confined to her room. Thompson then mentioned- the subject of the loan and deed. I don’t remember the exact language he used. 'The plaintiff then asked Braden if he would let her have the money, and said she supposed Mr. Thompson had told him all about the arrangement. He said Thompson had told him, and that it Avas all right. Something was said to which I paid no attention. I then Avent out into tOArn, and Avhen I returned I found Mr. Denson there, and the deed Avas executed. About the time of my return, or Avithin a feAv minutes after, Mr. Denson left, and Thompson and Braden remained. Braden said to Mrs, Bingham : ‘ As soon as you return you can have your land back.’

“ I know that the plaintiff Avas offered six hundred dollars by Mr. Ellis, an attorney of Carson City, on the day she gave the deed to Braden and before it was executed.”

This is all the material portion-of the testimony of the plaintiff’s sister, and it substantially harmonizes with that portion of the plaintiff’s testimony bearing upon this particular subject.

There is other evidence tending to show that Thompson was the person really interested in the deed, and that he furnished themoney advanced to the plaintiff by Braden. That evidence, however, in no wise tends to prove that there was any agreement by Braden or Thompson to reconvey the premises to the plaintiff, or that the money furnished' was a loan. • It simply tends to prove that Thompson was the party interested in obtaining the deed and that for some reason, which is not explained, he did not wish it to be known. Such conduct on the part of Thompson no more tends to prove an agreement on .his part or that of Braden to reconvey to the plaintiff, than it does to establish an agreement by the defendants to pay to the plaintiff a sum of money. The ground upon which the decree is sought is the agreement by Braden and Thomp- ■ son to reconvey. If that fact he established by clear and convincing proof it is conceded the plaintiff should recover, but every ambiguous movement in the conduct of the defendant Thompson does not necessarily tend to establish that fact. We are unable to see how the concealment of his interest in the transaction between the plaintiff and Braden can be treated as proof of an agreement by Braden to reconvey. Evidence that Thompson was the real party in interest was of course admissible for the purpose of charging the legal title held by Mrs. Thompson with the equity of redemption, but it certainly does not in the remotest manner tend to establish the important fact that the absolute deed was intended as a mortgage.

The evidence with respect to the real value of the land at the time of the conveyance favors the proposition that the deed was not intended as an absolute conveyance, but it also very clearly appears that the real value could not be realized by the plaintiff at the time she executed the conveyance and needed the money. This evidence, together with the testimony of the plaintiff and her sister, is all that was introduced in support of the assumption that the deed was intended as a mortgage; that the money was advanced as a loan, or that there was an agreement by Thompson or Braden to reconvey. «•

On the other hand the deed is presented, which is regularly acknowledged by the plaintiff, and is in terms an absolute conveyance. This instrument itself, to say the least, counterbalances the plaintiff’s testimony.

The defendant J. M. Thompson then testifies postively that no agreement was ever entered into, and that no conversation ever took place between the plaintiff and himself with respect to recon-veying the land in question, and that he heard no such conversation, nor knew of any such' 'agreement between plaintiff and Braden. Braden also testifies that no such understanding ever existed between himself and the plaintiff, and that not a word- was said prior to or at the time of the execution of the deed, about a reconveyance of the land, or the money advanced by him being a loan. He says that when he handed the “ money to the plaintiff she remarked that it was a very small sum of money to get for a place that had cost her so much.” These -witnesses, in their testimony, very minutely detail all the circumstances connected with the execution of the deed and the conversation which took place at the time, and flatly contradict the evidence of the plaintiff and her sister with respect to a reconveyance. Denson, the officer who took the acknowledgment and who is referred to by the plaintiff’s sister, in referring to the time of the acknowledgment, testified in this manner: “We were all near enough together for me to hear any conversation in an ordinary tone of voice. I heard nothing said on that occasion about the money being a loan or the deed being a mortgage or security, or Braden deeding back. I went to the house and into the room with Thompson and Braden, and we all came away together. We all walked out in company from Mrs. Bingham’s room- and from the house.”

This witness also clearly contradicts the testimony of the plaintiff’s sister with respect to the conversation between Braden and the plaintiff at the time of the acknowdedgment. He says : “ I heard the deposition of Mrs. Walker read at the trial of the other action about this matter. Nothing was said at this interview by Braden to any person about wishing to treat Mrs. Bingham better than any one else on account of her being a widow, or about Braden’s widowed mother.”

The witness Edwards, on behalf of the defendants, .testified in this way:

“ I saw the plaintiff and her sister at the International Hotel, in Virginia City, on the evening of July 5th, 1866, and had a conversation with Mrs. Bingham about this sale. I went there to talk with her about the land, at the request of Mr. Ellis. I did not then know that she had deeded it. I stated to her that Mr. Ellis wished to purchase it. I had a long conversation with her about the matter. * Her reply to me was,' that he was too late; that she had already sold the land. I think she said she had sold' it to Thompson, but I am not certain about that. She stated distinctly to me that the price she got for it was too small. She was sorry that Ellis had not made the arrangement to buy it before. She said she had sold the land and got too little for it, but Ellis was too late.” ’ ■

The witness Mrs. Rose testified that in September, 1866, whilst stopping at the defendant Thompson’s house, the plaintiff came there and inquired for Braden. He not being in, she stated to witness that “ she wanted to see him ; that she had heard he wanted to sell the land conveyed by her to him, and she wanted to see if she could buy it. She said she wanted to see him the first time he came to Carson, for she wanted the first chance to purchase it.”

Mr. Ellis, who is referred to by plaintiff’s sister as having offered to purchase the land, testified: “ I know the parties to this action. I drew the deed from plaintiff to Braden. I saw Mrs Bingham at her house on the day I drew the deed ; she talked about this land, and seemed to have no other business with me. She said she was about to sell the land to Braden for three hundred dollars. I told her I was advised of it; that I had drawn the deed. I asked her _ if she intended to take that sum for it; she said yes, unless she could get more. She asked me if it was worth more. I told her I thought it worth twice that, but that she knew her own necessities better than I; and I was unadvised whether it would bring more in the market. She then wanted me to buy it. Offered it to me for five hundred dollars — two hundred and fifty down, and the balance in ninety days. I declined to do it, for two reasons: — first, I did not have the money; and secondly, Mr. Braden was already nego-Rating for it. I made her no offer for the land.. I discouraged her selling the land. She told me she would do no more about the land until Monday. I first ascertained that she had sold on the Friday of the next week.”

In a letter written by the plaintiff to Ellis, dated July 22d, 1866, and introduced in evidence, this passage occurs: “ I met Mr. Edwards in Virginia. He said you were offered more for the ranch by another person. Is it true ? If so, what amount was offered ? I have regretted the trade more than onee, and my private opinion is, I have been very much swindled.'” If, with all this testimony to support it, the deed in this case can be decreed a mortgage, and the transaction between Braden and the plaintiff held not to be an absolute sale, then indeed does the title to real estate in this State stand upon the most precarious and insecure foundation. It would be as well to do away with all written instruments in the conveyance of land, and let the title to real property rest exclusively upon fickle recollection, vague surmises and hearsay evidence.

That consideration and weight which the Courts so universally give to solemnly executed instruments conveying the title to real property should not be overcome by an appeal ad misericordiam, or the bare cry of fraud. Proof so cogent, weighty and convincing as to leave no doubt upon the mind, ought alone to overcome them.

We know of no process of reasoning by which it can be maintained that the evidence on behalf of the plaintiff in this case meets this stringent requirement of the Courts iii cases of this kind. It is very evident the Judge below did not give to the deed that weight as evidence which should have been given to it.

We have not considered the preliminary points made by the attorneys for respondent in this Court, because they are fully covered, and the objections obviated, by the stipulation entered into by the respective counsel.

As the findings of fact are not warranted by the evidence, they are set aside, as also the decree ; and the Court below is directed to dismiss the bill.

Beatty, C. J., did not participate in the foregoing decision.