Opinion
Opinion delivered November 10, 1930.
1. REFORMATION OF INSTRUMENTS — MUTUAL MISTAKE. — Equity may reform a deed or other written instrument for mutual mistake of the parties which may be proved by parol evidence. 2. REFORMATION OF INSTRUMENTS. — To justify reformation of a written instrument against the will of one party thereto, as for fraud and mistake, the evidence must be clear and convincing. 3. EVIDENCE — PAROL EVIDENCE RULE. — The law does not permit the title to realty to rest in parol, and does not allow a deed to be changed by parol testimony of agreements had prior to the execution of the instrument. 4. EVIDENCE — PAROL EVIDENCE CONTRADICTING DEED. — Plain language of a deed should not be set aside by declarations made after its execution which may have been incorrectly understood or unconsciously changed by the witness. 5. ADVERSE POSSESSION — EVIDENCE. — Evidence held not to establish that plaintiff had acquired title to land in dispute by adverse possession. 6. REFORMATION OF INSTRUMENTS — EVIDENCE. — Evidence hold not sufficiently clear and convincing to establish a right to reform a deed. 7. BOUNDARIES — AGREEMENT. — That the vendor pointed out the boundary line when executing a deed would not amount to an agreement settling the boundary line, though it might be a misrepresentation entitling the purchaser to rescind. 8. VENDOR AND PURCHASER — FRAUDULENT REPRESENTATION. — A vendor's fraudulent representations in pointing out an erroneous boundary line held a defense to the vendor's claim for rent for a disputed tract occupied by the purchaser and for the timber cut therefrom by the purchaser.
Appeal from Craighead Chancery Court, Eastern District; J. M. Futrell, Chancellor; reversed.
Jeff Bratton, for appellant.
Wm. F. Kirsch, for appellee.
STATEMENT OF FACTS
Martha Baker Edwards brought this suit in equity against John Hoyer and Eva Hoyer, his wife, to reform a deed so as to include about twenty acres of land lying between the farms owned by the plaintiffs and by the defendants. The defendants filed an answer denying that plaintiff was entitled to reformation, and, by way of cross-complaint, asked to recover possession of the twenty-acre tract of land referred to in the complaint and for three years' rent and $90 damages for timber cut and removed therefrom.
The record shows that John Hoyer was the owner of 187.62 acres of land in section 1. 93.81 acres of the land was in the east half of the northwest quarter of section 1, and the remaining one-half of the tract was in the west half of the northeast quarter of section 1, so that the two tracts joined each other.
On the 1st day of July, 1921, John Hoyer and his wife conveyed 93.81 acres of said land to Martha Baker and her husband, Lee Baker, under a description which reads as follows: "Lot 3 of section 1 and the southeast quarter of the northwest quarter of section 1, all in township 15 north, range 6 east, containing 93.81 acres, more or less," in Craighead County, Arkansas. Martha Baker was the owner of 49 acres in Greene County and exchanged it with the defendants for the land in question, and the defendants agreed to assume the mortgage of $1,100 on the Greene County land of Mrs. Baker. After the execution of the deed and before the instigation of this suit, Lee Baker died, and Mrs. Martha Baker then married Jess Edwards.
According to the testimony of Martha Baker Edwards, on the day the contract was made John Hoyer told her that the line between the 93.81-acre tract which he conveyed to her and the 93.81-acre tract still owned by Hoyer, immediately east of the tract conveyed to her, was a line running north from a corner between the land south of the tract in question between John Allison and Doc Asbury's land. In other words, the understanding was that she was to get all the land west of a line running north from the corner between the Allison and Asbury land. The plaintiff made an agreement with a tenant of the defendants as to where the line between the two tracts was, and each one thereafter cultivated with reference to this supposed line. Still later, by agreement between the tenant of Hoyer and the plaintiff, a fence was erected along this line in 1924. Subsequently, the line was established between the two tracts of land according to the United States land survey, and it was found that the strip of land in controversy, containing between fifteen and twenty acres, belonged to the 93.81-acre tract still owned by Hoyer and was not included within the limits of the 93.81-acre tract conveyed by Hoyer to Mrs. Martha Baker and her husband. The strip in controversy includes about seven or eight acres of high land which was in cultivation and had formerly been cultivated by the plaintiff. The husband of the plaintiff was along when the survey was made. Under the survey, the plaintiff received a like amount of land on the west side of her strip which she had not claimed before. This was timber land; and after the survey had been made, she sold the timber on the tract assigned to her on the west side of her 93.81-acre tract.
S.E. Viteto was also a witness for the plaintiff. According to his testimony, he bought the timber from Hoyer and Mrs. Edwards both in 1926. He had a conversation with Hoyer about the line between Hoyer and Mrs. Edwards. Hoyer pointed out a blazed line and said that Mrs. Edwards owned all the land west of that line. This included the land in controversy. Viteto testified that Walter Crevoishier and Bert Foster were present and heard the conversation between Viteto and Hoyer. The former corroborated the testimony of Viteto, and the latter denied having heard any such conversation. He said that nothing was said by Hoyer to Viteto about a line between him and Mrs. Edwards having been pointed out or agreed upon.
Other witnesses testified that John Hoyer had admitted to them that the fence which had been erected by his tenant and the plaintiff was the boundary line between them.
John Hoyer was a witness for himself. According to his testimony, he agreed that the tenant might build a fence between his land and the tract which he had conveyed to Mrs. Baker, but he had nothing to do with fixing the line where the fence was to be built. When he made the deed to Mrs. Baker and her husband, he did not know where the dividing line was between the two 93.81-acre tracts of land, and did not attempt to point out such line to Mrs. Baker. He never did agree with her and her husband that the east lines of their land would be the line extending directly north of the corner between the Allison and Asbury land. The line fixed by the survey made gave to Hoyer about seven acres of cleared land claimed by Mrs. Edwards. The rest of the land is under water. Hoyer admitted blazing a line between his land and Mrs. Edwards' for the purpose of timber cutting. He did not know where the true line was, and did not want to encroach upon the land of Mrs. Edwards in selling his timber. For that reason he blazed a line for the benefit of the timber cutters, but had no idea of fixing that as the boundary line between him and the plaintiff. He also admitted being present when a line was established between him and Allison and Asbury. He owned the land north of the tract of these parties, and the only object in fixing the line was to establish the line between him and them. No attempt was made to survey any of his land north of the Allison and Asbury land. Other evidence was introduced tending to corroborate the testimony of John Hoyer.
Reference will be made in the opinion to such additional testimony as is deemed necessary to a decision of the issues raised by the appeal.
From a decree in favor of the plaintiff, the defendants have appealed.
(after stating the facts). According to the allegations of the complaint and from the findings made by the chancellor, this is a suit to reform the description of land in a deed. The question raised by the appeal is one of fact because the law relating to the reformation of written instruments by parol evidence has been well settled by the repeated decisions of this court. There is no doubt that a court of equity may reform a deed or other written instrument where, on account of mutual mistake, such instrument does not reflect the intention of the parties thereto, and the mistake may be proved by parol evidence only. To justify reformation, however, against the will of one of the parties thereto, the evidence of the mistake must be established by clear, convincing, and decisive evidence. McGuigan v. Gaines, 71 Ark. 614, 77 S.W. 52; and Sewell v. Umsted, 169 Ark. 1102, 278 S.W. 36. So, too, parol evidence is admissible in an action to reform a written instrument on the grounds of fraud and mistake, but the evidence to warrant a reformation must be clear and convincing. Welch v. Welch, 132 Ark. 227, 200 S.W. 139. This rule of law is so well established in this State that a further citation of authorities is useless. The only difficulty lies in applying the rule to each particular state of facts. The law does not permit the title to real property to rest in parol, and does not allow the plain language of a deed to be changed on parol testimony of promises and agreements had prior to the execution of the instrument. The reason is that deeds are supposed to be the best possible protection to owners of land, and it is the policy of the law to make them so. While they may be reformed by parol evidence alone, such evidence must be clear and convincing; otherwise the title to land would rest in complete confusion and doubt.
Here there is irreconcilable conflict in the testimony of the parties to the transaction. It is true that the plaintiff introduced the testimony of several witnesses to the effect that the defendants had subsequently acknowledged that the fence which had been erected was the boundary line between them. While this evidence is competent, it is not very trustworthy. The language of the deed is plain and unequivocal, and should not be set aside by declarations or conversations made and had after its execution which may have been incorrectly understood or which have been consciously or unconsciously changed by the witnesses or imperfectly heard at the time. The record does not show precisely when the pleadings were filed in this case, but it does show that the taking of depositions was commenced on the 26th day of January, 1929. The deed to the land was executed on the first day of July, 1921. The fence between the two tracts was erected in 1924. Thus it can not be said in any sense that the plaintiff has acquired a title to the twenty-acre strip of land by adverse possession, and we do not think that her testimony and that of the other witnesses in her behalf establishes her right to a reformation of the deed by that clear, convincing, and decisive evidence which the law demands.
Nor do the facts in this case call for an application of the rule with regard to agreed boundaries. This court has held that where adjacent owners are in dispute as to their dividing line, their oral agreement as to the boundaries establishing the line, when followed by possession with reference thereto, is valid and binding on the parties. Agreements in such cases do not operate as a conveyance so as to pass title from one to another, but they proceed upon the theory that the true boundary line is in dispute, and that the agreement serves to fix the true line to which the title of each extends. The parties thereafter hold to the line as if by virtue of their respective deeds. The theory is that the parties have simply, by agreement, settled their boundary line which was in doubt, instead of having the court settle it for them. Sherrin v. Coffman, 143 Ark. 8, 219 S.W. 348; and Glasscock v. Mallory, 139 Ark. 83, 213 S.W. 8.
According to the testimony of Mrs. Edwards, when she purchased the land and received her deed in July, 1921, Hoyer told her that the boundary between them would be a line running north from the corner between the Allison and the Asbury land which was situated south of the tract in question. On the other hand, Hoyer denied that he made any such representation to Mrs. Edwards as to the boundary line. They both agreed that Hoyer intended to convey to her one-half of a tract of land containing in the aggregate 187.62 acres; that she was to receive the western half of the tract, and that Hoyer was to retain the eastern half thereof. Evidence was introduced by each of the parties to corroborate their testimony in this respect.
There is no need in this connection to determine where the preponderance of the evidence on this point lies, because, even if Hoyer had pointed out the boundary line at the time the deed was executed, this would not be an agreement settling the boundary line. It would simply amount to a misrepresentation which might entitle Mrs. Edwards to rescind the contract. She does not ask for a rescission of the contract, but only for a reformation thereof. The fact that she asked for a reformation of the contract so as to include the disputed strip of land recognizes that she does not think that the disputed strip is within the calls of her deed. She states that she went into the possession of the land in 1921, and that sometime in 1924 a fence was built between them which was to be the boundary line. Hoyer denied this in positive terms. He testified that he did not know where the fence was built, and only agreed that a fence might be erected between them. The testimony of Hoyer's tenant shows that he made the agreement with Mrs. Edwards to erect the fence for the purpose of protecting their crops and that Hoyer had nothing to do with the erection of it.
The burden of showing that there had been an agreement between the parties to establish the boundary line rested on Mrs. Edwards, and we are of the opinion that she failed to meet the burden in this regard. Hoyer admitted that he blazed a line for timber cutters to follow, but said it was done as a matter of precaution so that the timber cutters would not trespass on the land of Mrs. Edwards, and that it was not made with a view to establishing a boundary line between them. Mrs. Edwards was not present and had nothing to do with establishing this line. This question is not raised in the original briefs of the parties; but, inasmuch as the case is in equity and equity cases are tried de novo upon appeal, the question raises itself. After a careful consideration of the testimony, we are of the opinion that Mrs. Edwards failed to establish by a preponderance of the evidence that there had been an agreement between her and Hoyer as to the boundary line between them. Each of them testified that she was only to get one-half of the tract which would amount to 93.81 acres. After the dispute as to the boundary line on the east end of the tract conveyed to Mrs. Edwards, she went upon a tract of land on the west side and cut timber which would not be included within the 93.81 acres if the boundary line on the east claimed by her is to be considered the true boundary line. This tends to show that she intended to claim 93.81 acres of land irrespective of the disputed strip. In any event we do not think she has shown by a preponderance of the evidence that there was an agreement between her and Hoyer for the establishment of a boundary line between the two 93.81-acre tracts in question.
We now come to a consideration of the damages claimed by Hoyer in his cross-complaint. He asks for rents on the disputed strip for the past three years and for the value of the timber cut therefrom by Mrs. Edwards. In a case note to 33 A.L.R. at 1039, it is said that the right of a vendee to base an affirmative or defensive claim upon the ground of the vendor having fraudulently misrepresented or concealed the position of boundary lined has been affirmed in numerous cases. In Haynes v. Harper, 25 Ark. 541, the boundaries were misrepresented in such a manner as to lead the vendee to suppose that all the tract sold was of good quality, whereas it really embraced a parcel of poor, wet land. In Cooper v. Merritt, 30 Ark. 686, the vendor pointed out to the vendees, boundary lines which, if they had been as represented, would have included much more cleared land than that actually contained in the parcel sold.
The cross-complaint of Hoyer was tantamount to an action by him under the contract, and Mrs. Edwards, his vendee, had a right to defend the cross-complaint on the ground that she had been induced to enter into it by the vendor's fraud. Therefore, after a careful consideration of the evidence on this point, we are of the opinion that Hoyer was not entitled to recover anything from Mrs. Edwards on his cross-complaint, either by way of rents or by way of damages for cutting and removing the timber from the disputed strip of land.
It is true, as pointed out above, that Mrs. Edwards has not asked for a rescission of the contract on the ground of fraud in the pointing out of the boundaries to her when the sale of the land was made. She may have elected to keep the land notwithstanding the fraud, but this did not prevent her from setting up the fraudulent misrepresentations in pointing out the boundary line to her as a defense to the cross-complaint of Hoyer for damages for cutting and removing the timber on the disputed strip of land and for rents which had accrued for the past three years just prior to the suit.
The result of our views is that the decree will be reversed, and the cause will be remanded to the chancery court with directions to dismiss the complaint of Mrs. Edwards for a reformation of the contract for want of equity and also to dismiss the cross-complaint of Hoyer for want of equity, in so far as his right to recover damages for cutting and removing the timber and for rents is concerned. It is further ordered that a decree shall be rendered in favor of Hoyer for the recovery of the possession of the disputed strip of land.