Ormsby v. Civil

9 Ky. Op. 460, 1877 Ky. LEXIS 271

• Court: Court of Appeals of Kentucky
• Decided: June 8, 1877
• Status: Published

Opinion

Opinion by

Judge Cofer :

Calvert’s statement that Ormsby assigned the note to Mrs. Civil in consideration of the transfer of sixty-five shares of stock, and that' the transfer was made on( the day of the date of the note, is, in our opinion, true. In these statements he stands uncontradicted. He is no doubt mistaken when he says he sent the note to her by mail on the day it was executed and assigned, but that circumstance is not sufficient to discredit him as a witness. Unless that be done we must find as an established fact that the transfer was made as stated.

It is true Mrs. Civil might have testified as to the time when she received the note, and that she had the stock which Calvert says he transferred for her to Ormsby for the note. But her failure to testify as to these facts is not very material, as she made out her case on this point by the testimony of Calvert. As long as he was uncontradicted she had a prima facie case without testifying herself, unless Calvert is to be discredited because she did not testify, which will not be contended for.

The assignment of the note without recourse is a circumstance rather in her favor than against her. It was natural that Ormsby should not desire to become liable on his assignment. But if, as claimed by Ormsby, the note was paid off by Calvert and taken up, and he afterward wrote the assignment for the purpose of again putting it into circulation and thereby to commit a fraud, it is hardly probable that he would have been mindful to protect Ormsby by an assignment without recourse. The same may be said of the paper dated August 20, 1872.

July 6, of that year, Calvert reconveyed the land to Ormsby and received payment in full. The note held by Mrs. Civil was a lien on the land, and Ormsby having paid Calvert in full for it, in case he failed to pay the note the lien would be enforced against the land, and Ormsby would be loser to that extent, and hence it was proper that he should be indemnified. But if, as Ormsby claims, the note had been paid off, and the assignment afterwards filled up by Calvert, Ormsby would not have accepted the indemnity receipted for in that paper.

That he did accept it is conclusive against him that he assigned the note, and that it was never paid as he now claims. It is true that transaction was after the execution of the mortgage to Mrs. McGeehee, and is therefore not evidence against her, but it overthrows the whole theory of Ormsby’s defense, and deprives her of any aid from that source to make out her case. The theory that the note was paid off and afterwards assigned by Calvert is unsustained by evidence. It rests wholly upon the answer of Ormsby, and as he is contradicted by that writing there remains nothing to uphold the claim that the note was paid off. It also shows that neither Calvert nor Ormsby regarded the reconveyance as canceling the note.

That the reconveyance canceled the lien as against Mrs. Civil cannot be maintained. She was not a party to that transaction, and the fact that Calvert may have been her agent , cannot affect her rights, without evidence showing that he was specially authorized to release her lien in his own favor. Ormsby, as we have already decided, having transferred the note to her before the reconveyance, could not set up that conveyance against her. As between them the lien was certainly enforcible. It was evidenced by the deed of record when Mrs. McGeehee took her mortgagee, and must prevail over it. The bad :faith of Calvert or of Ormsby, if any, cannot prejudice Mrs. Civil, who, so far as the record shows, is as free from blame as Mrs. Mc-'Geehee. So far as Mrs. Civil is concerned she stands precisely as she would have stood, if, instead of conveying the land back to ■Ormsby, Calvert had conveyed it to a third person, who had mortgaged it to Mrs. McGeehee.

That Calvert told Sherley that he had reconveyed the land, and ffailed to tell him that Mrs. Civil held the note or that the lien was -not discharged, does not affect the question, even if it be conceded that he was her agent, and she is bound by his reply to Sherley as •though she had made it herself. Sherley did not disclose his object -in making the inquiry, and if he had made that inquiry of Mrs. Civil and she had not known all the facts known to Calvert, she would not be estopped to assert her lien against Mrs. McGeehee. What Calvert told him was a full answer to his question, and was true.

Ham Pope, for Ormsby, et al. J. B. Kinkead, for Mrs. McGeehee, et al. Barr, Goodloe & Humphrey, for appellee.

If he had disclosed the object of his inquiry, then it would have been Calvert’s duty to disclose the existence of the lien. But as he was not informed that the object of the inquiry was to ascertain whether the land was incumbered in order to decide whether it could be safely accepted as a security, the answer made by Calvert would not estop him, and a fortiori cannot estop Mrs. Civil. -

Judgment affirmed.