Boardman v. Taylor , 66 Ga. 638 ( 1881 )

Jackson, Chief Justice. •

This case arose on a bill filed by Boardman in his own right, and as next friend of the minor children of Holmes and wife, against the said Holmes and wife, Mrs. Watkins, the mother of Mrs. Holmes, and Taylor, a purchaser of á house and lot in Macon, to secure a debt of his, to reform a certain deed made at the instance of Watkins, the husband of Mrs. Watkins .and father of Mrs. Holmes, to the said house and lot, by complainant to John Rutherford as trustee for the wife of Watkins for life and then to his daughter. The bill alleges that Watkins, trustee, had previously made complainant a warranty deed to the property, but furnished him the money to pay for it; and on the same day this deed was made to him he made the deed sought to be reformed to Rutherford by Watkins’ directions. The bill alleges that the intention of the parties, Watkins and Boardman, was to give the use of the property to the children of Mrs. Holmes after the termination of her life estate, should she survive her mother, and that this provision was. not inserted in the deed because of the inadvertence of the draftsman; that as the deed stands it leaves the remainder, after the termination of Mrs. Holmes’ life interest, in complainant, who has no right to it; that the money was furnished him by Watkins to buy the house and lot for the benefit- of his, Watkins’, family, and he intended the property to go to his wife and daughter for life, and then in fee to the infant children of the daughter, whom complainant represented as next friend in this suit.

The bill further alleges that Rutherford resigned the trust, and the legal title for the uses aforesaid got into Holmes; that part of the lot has been sold by said Holmes, and that he executed a deed to Taylor to part of it in order to secure a debt contracted for the loan of money to Holmes, trustee, by Taylor, by order of the superior court of Bibb county, in 1874; that when it fell due Holmes could not pay it, and for forbearance another deed was executed under another order of the same court in 1876; that being still unable to pay when the money loaned became due, Holmes and wife and Mrs. Watkins executed an agreement by which the property was to be sold within thirty days after the first of November, 1877, when it should be advertised ; that accordingly it has been advertised and will be sold unless enjoined.

The bill alleges further, that at the date of the first sale under the order of court one child was born to the said Holmes and wife. Another was born before the second deed was made; that died and a third was born, and none have ever been represented by a testamentary or a statutory guardian.

The bill denies the power of the court of equity to order the sale of the whole trust estate, and attacks the validity of the order on the ground that the debt was not contracted for the benefit of the trust estate or the cesttii que trusts, but for the individual benefit of Holmes, the trustee; that the minor children were not served under the act of February 23d, 1876; that the property is not properly described in the petition, order of court and advertisement; and that the interest of cestui que trusts is not subject to be sold as directed and advertised.

Taylor answered the bill, and making his answer a cross-bill, denied the allegations of the bill so far as it set up any equities against him, and prayed for a decree in his favor as an innocent purchaser without notice of the equities, of these children, and that the house and lot be sold and his debt be paid.

The cause went to trial on the bill, the cross-bill and answers thereto, and testimony, and the jury found a verdict for the defendant, Taylor.

Thereupon a motion was made for a new trial on various grounds therein set out, it was refused, and complainant excepted.

1. The court did not abuse its discretion in not continuing the case. Mrs. Watkins’ presence was not needed as a party. She was a defendant, and could not well assist the complainant. It is not pretended that complainant needed her as a party to help the prosecution of the case. Her interrogatories as a witness could have been taken. It was laches not to do so. She was not subpoenaed.

2. There was no error in rejecting the testimony of the draftsman in regard to mistake in drawing the deed, inasmuch as counsel for complainant admitted that they could not bring home to Taylor actual notice that such mistake was known to Taylor, and inasmuch as the record of the deed gave constructive notice only of the contents of it as it stood ; nor was the rejection of the testimony such error, so far as the other defendants were concerned, as to authorize a new trial against Taylor. The others were alii in confederacy with complainant, admitted the mistake, and the deed could doubtless be reformed so far as they were concerned by consent, and,, if not, in a bill against them; .It is clear that the only practical contest here was between Taylor and the cestui que trusts.

3. There was no error , in rejecting the testimony of Holmes in regard to what disposition he made of the money after the trade had been consummated and the money had been deposited with Plant & Son as bankers. It is true that these bankers had negotiated the loan for Holmes with Taylor, and were his agents for that purpose ; but when it was consummated, and the money loaned was deposited by Holmes with them as bankers, they assumed :a new relation, and ceased to be the agents of Taylor, so -that any notice to them of misapplication of the funds so ■deposited, after the agency had ceased and their new and independent character had been assumed, cannot be-tortured into notice to Taylor so as-to affect him with knowledge of this misapplication.

For the same reason the checks drawn by Holmes, some -of which were apparently for his individual use, were in.admissible. They were drawn on the bankers and not on the agents of Taylor. Nor is there any proof, nor was .any offered, to connect Taylor with knowledge of this •misapplication, except in so far as notice to Plant & Son might be notice to him ; and it would have been had the -agency not ceased with the consummation of the sale or loan.

4. If Mrs. Watkins and Mrs. Holmes signed the application or petition for the order of the court, it was their ■duty to take notice of vvhat they signed, and it was immaterial whether they read the paper or not. Therefore we •see no damage or hurt in rejecting Holmes’ testimony that they did not read it or have it read to them.

5. The act of February 23d, 1876, does require per•sonal service upon' these infants, and if the title to Taylor had not passed by virtue of the deed of 1874, made pursuant to the order of the chancellor of that year, •¡there would be trouble on this point. Regarding the ^subsequent order as a mere extension of time or renewal «of a deed made under a valid order when there was no •personal service required, we do not see such error in the • court’s admitting the subsequent order of the chancellor -to extend the time and to that end make another renewed mote and deed as security, in order to get the extension -of time which the borrower desired.

At that time — in 1876 — when the last order of the «chancellor was made, the title was in Taylor, and if the time had not- been extended it would have remained in ihim to .secure the loan; and if this petition for the extension of time had been rejected, the parties would have been sold out sooner. At all events, equity would require that they should not object to what was done for their accommodation because a mere formality had not been complied with, when if it had not been done, the parties would have been in the same if not in a worse condition. We say formality, because personal service upon real infants like these — children but a few years old and wholly incapable of defending a suit — is a mere formality. The protection of such infants is in the breast of the chancellor. If the judge does not protect them by the appointment, not of a mere man of straw, but of a competent guardian ad litem, and if he does not himself see 'to it that their interests are protected, personal service upon them, helpless and ignorant as they are, will be no remedy. Still, while the act is on. the statute book, it is the duty of the courts to regard and enforce it. But in this case the transaction, in so far as the loan and the security for it, had transpired under a valid order before the act was passed, and it would be inequitable not to enforce the prior valid order and deed made under it because of a mere renewal of it under an order defective on account of a mere informality.

6. There was no usury in the transaction. The payment of the money to Plant & Son to negotiate the loan, which money Taylor never got, and of which he knew nothing, cannot convict him of usury, or taint the loan he made with the leprosy of usurious interest.

7. The statute — Code, §4221 et seq., and §§2320-2327-2330 — authorizes the proceeding before the chancellor at chambers.

The object was to pay taxes due and to support the cestui que trusts. Taylor is an innocent purchaser who has done no wrong, and whom a court of equity will not en- ■ danger or damage, but will protect. Its powers will not be exerted to his detriment. He is ever a favorite in her courts, and the verdict and decree in this case are right.

The general countenance of the complainant’s case is bad. The inception of it looks ugly. Watkins advances money to Boardman to buy a piece of property from himself as trustee, and then Boardman conveys to Rutherford in trust for Watkins’ family. It looks as if this circumlocution had been designed to cover some transactions that would not bear the light of plain dealing. Be that as it may, under an order of chancery at chambers, in accordance with law, title has been passed to an innocent purchaser without notice to secure an honest loan of money, and time was extended under a like order when the borrower could not meet his engagement, and a sol emn engagement entered into afterwards for additional time, to interpose no obstacle by those whom complainant alleges are the beneficiaries of the trust as the deed stands. Equity will not correct any mistake in the deed, so as to defeat such an innocent purchaser for value without notice of the mistake, and the decree must be affirmed.

Judgment affirmed.