Sherwin-Williams Company v. Leslie

272 S.W. 641, 168 Ark. 1049, 1925 Ark. LEXIS 362
Supreme Court of Arkansas·Decided June 1, 1925·Published·Cited by 4 cases

Opinions

Wood, J.

On the 23rd of September, 1920, J. S. Norman and wife executed a deed of trust in favor of Mrs. Kate A. Fowler to secure her in the sum of $5,000. Sam E. Leslie was named as trustee in the deed. The deed embraced the following lands:

SEW of SEW section 25, and Wy2 of NEW of NEW, section 36, township 9 south, range 27 west, except one acre in the northwest corner, in Howard County, Arkansas; and the N% of SEW of section 19, township 9 south, range 26 west in Hempstead County, Arkansas.

On the 26th of December, 1922, the Ozark Nursery & Seed Breeding Farms, a corporation, through its president, J. S. Norman, and M. C. Foster, its secretary, executed a deed of trust to the Sherwin-Williams company, hereafter called company to secure a promissory note in the sum of $2,203.94, which was due April 1, 1923. The deed of trust to the company contained the following land:

“SEW of SEW land the NEW of SEW, section 25, and the WW of NEW of NEW of section 36, all in township 9 south, range 27 west, Howard County, Arkansas, except one acre in the northwest corner of last-named tract. ’ ’

The deed of trust to the company was duly recorded on December 28,1922. It contained the following clause: “This deed of trust is subject to a first mortgage to Mrs. Kate C. Fowler in the sum of $6,000.”

This action was begun by Sam E. Leslie, trustee, in the chancery court of Howard County against Norman and wife, and one J. S. Butt and the company to foreclose the deed of trust in favor of Mrs. Kate C. Fowler. Leslie alleged that in addition to the land actually conveyed and described in the deed of trust to Mrs. Fowler, it was intended to include the following land situated in Howard County: The NEW of SEW of section 25, township 9 south, range 27 west. He further alleged that the company claimed an interest in the land above described by virtue of the deed of trust executed to it. Leslie prayed that the deed of trust to him in favor of Mrs. Fowler be reformed, so as to include the lands last above described and that the trust deed as thus reformed be foreclosed.

The company, in its answer, denied that the mortgage to Mrs. Fowler was prior in date to its mortgage, and alleged, by way of cross-complaint, that its mortgage on the NE]4 of SE]4 of section 25, township 9 south, range 27 west, was senior and paramount to Mrs. Fowler’s mortgage, and the company prayed that its lien on this triaet be declared superior to that of Mrs. Fowler, and that its mortgage be foreclosed on said land.

. The undisputed proof was to the effect that the grantors in Mrs. Fowler’s mortgage intended to include the tract of land in Howard County in controversy, and that the grantors were living on that tract when the mortgage in favor of Mrs. Fowler was executed, and by oversight the scrivener omitted that tract. It was agreed by the parties that the company had no knowledge or notice of an intention on the part of the grantors in the mortgage to Mrs. Fowler to include therein the NE]4 of SE]4 of section 25, township 9 south, range 27 west, in Howard County, Arkansas, unless the clause, “this deed of trust is subject to a first mortgage to Mrs. Fowler in the sum of $6,000,” constituted such notice. It was agreed that, if Mrs. Fowler’s mortgage should be construed to include the lands last above mentioned, then judgment should be rendered and foreclosure had of the mortgage on the lands mentioned in her favor; otherwise, the judgment and foreclosure on the tract mentioned should be in favor of the company.

The trial court, upon the facts as above set forth, found that the mortgage to Mrs. Fowler included the tract of land in controversy as above described, and that her mortgage should be reformed so as to include such tract. The court rendered a decree in her favor, foreclosing tlie mortgage oil such, tract, and from that decree the company prosecutes this appeal.

As between Mrs. Fowler, the beneficiary, and the grantors in the deed of trust from Norman and wife to Leslie, the trustee, Mrs. Fowler was entitled to a ref ormation of the deed of trust so as to include the lands in controversy, under the uncontroverted proof that it was the mutual intention of all parties to that deed of trust that such lands should be included and that it was omitted merely through oversight of the scrivener who prepared the deed of trust. Craig v. Pendleton, 89 Ark. 259. Therefore, the deed of trust from Norman and wife to Leslie, the trustee, in favor of Mrs. Fowler, executed September 23, 1920, should read as if it originally included, in addition to the lands therein described, the NE14 of SE14 of section 25, township 9 south, range 27 west, in Howard County, Arkansas, the same being the tract of land in controversy.

As between the appellant and the appellee, Mrs. Fowler, the only issue is whether or not the latter is entitled to have her deed reformed so as to give her a lien on the land in controversy, which is paramount to the lien of appellant under its deed of trust. We believe the doctrine of the above case is' also decisive of this issue, for, in that case, it is held (quoting syllabus): “Where a mortgage by mistake incorrectly describes land intended to be conveyed, the mortgagee is entitled to reformation thereof as against the mortgagor or any subsequent purchaser with notice of the mistake.” The. notice mentioned in the above excerpt means either actual or constructive notice.

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Sherwin-Williams Company v. Leslie, 272 S.W. 641, 168 Ark. 1049, 1925 Ark. LEXIS 362 (Ark. 1925).

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