Pickett v. Ferguson

45 Ark. 177
CourtSupreme Court of Arkansas
DecidedMay 15, 1885
StatusPublished
Cited by45 cases

This text of 45 Ark. 177 (Pickett v. Ferguson) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Pickett v. Ferguson, 45 Ark. 177 (Ark. 1885).

Opinions

Smith, J.

In November, 1877, Ferguson & Hampson, merchants and partners, trading at Memphis, in Tennessee, accepted from Mrs. Pickett and her husband a lease of the plantation, Nodena, lying in Mississippi county, Arkansas, for the term of five years, to begin on the first of January then next ensuing. They stipulated to pay, on the first of -December in each year, a certain rent for each acre of tillable land, the area to be determined by an actual survey, and to repair the fences and buildings. They were to enjoy free of rent any land which they should themselves clear and put into cultivation; but Mrs. Pickett was not to be charged with the value of any improvements. According to the survey, made about the same time, the rents reserved amounted to $3510 per annum.

At the time this lease was executed, the plantation was incumbered by a deed of trust, the debts secured thereby aggregating about $2*>,ooo, and a decree of foreclosure had been rendered by the circuit court of t-he proper county; but the cause was pending in this court, on appeal. Soon after-wards a decision was reached, which is reported in 32 Ark., 3‡6, under the style of Pickett v. Merchants National Bank. And pursuant to that decree the clerk and master of this court sold the premises on the 28th of February, 1879, to Louis Hanauer, for the price of $18,001. The sale was approved and a deed executed to the purchaser.

Mrs. Pickett was, at the date of the lease and of the sale, the owner of the equity of redemption. Her lessees were not parties to the foreclosure suit, but coming in. pendente lite were •chargeable with constructive notice and had, besides, actual notice of the pendency and status of the litigation. The rent for which they were liable for the year 1878 remained unpaid. And they had also, about the 21st of May, 1878, collected ^536.33 of insurance money belonging to Mrs. Pickett, which they refused to pay over. She accordingly brought her action in the circuit court of Shelby county, Tennessee, against them to recover this rent. and insurance money. The defendants ■claimed, to recoup the damages they had sustained by their eviction under the foreclosure sale. The jury returned a verdict of $3000 for the plaintiff. Mrs. Pickett having moved for ■a new trial, the court declared the verdict to be too small, and gave the defendants their option, either to consent that the amount of recovery be increased to $3850 or to submit to another trial. As they refused to raise the verdict, a new trial was granted. Mrs. Pickett now dismissed her action at law and filed her bill in the chancery court of Shelby county against them and Hanauer. In the trial of the action at law, it had been developed that Hanauer’s purchase was made at the instance and for the benefit of Ferguson & Hampson, and that he had subsequently quit-claimed to them, they remaining all the time in possession. The theory of Mrs. Pickett’s bill is, therefore, that Ferguson & Hampson w<gre the real purchasers, at the foreclosure sale, and that, by reason of the relation they sustained to her, their purchase enured to her benefit. She prays to redeem, upon the terms of refunding the purchase money actually advanced by Hanauer, less the amount due her by Ferguson & Hampson for insurance collected by them and not accounted for, and less, also, the rents of the place that-accrued both prior and subsequent to the sale.

1. Purchase pendente lite. Constructive notice.

Process was duly served upon Hanauer and Hampson, but. there was no service upon Ferguson, except constructive service-by publication in a newspaper, nor did he appear to the suit. He had, long before the bill was filed, removed his family from. Memphis and had taken up his permanent residence on the plantation, and had become a citizen of Arkansas. His connection with the firm of Ferguson & Hampson still continued, and down to the time of filing the bill he was in the habit of visiting Memphis frequently, but thereafter he systematically avoided going into Tennessee, for the avowed purpose of preventing the service of process upon him.

While the cause was still pending in the chancery court of’ Shelby county, Tennessee, Mrs. Pickett filed a substantial copy of her bill in the circuit court of Mississippi county in this, state. She charges that the original agreement between her and her tenants had been that they should make their rent notes payable to her order, so that she might sell or. hypothecate them in the market, and thus raise funds to pay off the decree against Nodena; but that this stipulation was not inserted in the lease, because the acreage was not then certainly known, and the lessees had afterwards fraudulently refused to give their notes, with a view to cripple her resources and precipitate a sale, to the end that they might themselves become the purchasers. She avers that she also owned a valuable residence property in Memphis, which one of the beneficiaries in the trust deed had offered to take in satisfaction of his claim, amounting to $8508.58; and that, if her tenants had not thwarted her purposes, she could have satisfied the other creditors and have averted a sale. The prayer was that the bill might be retained until the final determination of the suit in Tennessee, to the end that if the plaintiff should be successful there, she might, by appropriate supplemental pleadings, enforce her equities thus ascertained by a decree here operating directly on the title of the lands, and if she should be defeated there, upon any grounds not concluding the merits, as for example, on account of the absence of Fergusqn, then she might be permitted to prosecute her bill as an independent suit for redemption; and in the event that she failed to establish her right to. redeem, she prayed to recover of Ferguson & Hampson her insurance money and the rents for 1878.

To this bill the three defendants filed a joint answer, which was made a cross-bill. They denied that Ferguson & Hampson were' the real purchasers at the foreclosure sale; but admitted that Hanauer had bought at their suggestion, and for their protection against irreparable injury, they having expended several thousand dollars in the year 1878 in repairs, fencing and clearing land, and in preparations for planting during the term of their lease, and being in danger of losing the benefits of these improvements and outlays by the impending sale, which Mrs. Pickett was powerless to prevent, she being, as it was alleged, utterly insolvent. They further admitted that Hanauer, about one year after the sale, had resold and conveyed the plantation to his co-defendants for $22,541, of which sum $9000 were paid in cash, and for the remainder, notes secured by a mortgage on the place were given, which were still unpaid. They denied that Ferguson & Hampson had ever agreed to make their notes for the rent. They admitted the non-payment of the insurance money and rent for 1878, but justified the detention of those sums to reimburse themselves for the loss of their term by the constructive eviction of themselves and determination of the tenancy by the foreclosure sale. They denied Mrs. Pickett’s right to redeem upon any terms, and alleged that since the purchase they had expended $25,000 in improvements, consisting of a- fine steam gin, thoroughly equipped with machinery of the latest pattern, the erection of a barn, two store houses and more than fifty tenant houses, the building, of a levee along the Mississippi river three-quarters of a mile long, the clearing and fencing of seven hundred acres of land, etc.

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Bluebook (online)
45 Ark. 177, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pickett-v-ferguson-ark-1885.