Summary
explaining the recording of a deed is prima facie evidence of delivery
Summary of this case from Jarmuth v. Int'l Club Homeowners Ass'n, Inc.Opinion
15064
April 11, 1940.
Before SEASE, J., Spartanburg, September, 1939. Affirmed.
Action by Della Littlefield Williams against Enoch Lawrence and others to foreclose a real estate mortgage alleged to have been given to plaintiff by James Anna Lawrence, deceased. From a judgment dismissing the complaint, the plaintiff appeals.
The Master's report follows:
The plaintiff, Della Littlefield Williams, commenced this action by the service of summons and complaint upon the defendants and is for the purpose of foreclosing a real estate mortgage.
The matter was referred to me as Master for Spartanburg County by an appropriate order, in pursuance of which I held several references and took considerable testimony; all of which I filed along with my report and recommendation made February 17, 1936. This report on exceptions made by the plaintiff was confirmed by a decree of Judge T.S. Sease. Notice of intention to appeal from the decree of Judge Sease was given, but before the appeal was perfected, due to the fact that certain real estate belonging to the estate of James Anna Lawrence, deceased, had been sold through an order of the Federal Court for the Western District of South Carolina, and the proceeds derived from the sale thereof had been applied to judgments held by one of the defendants, Albert L. Lohm, as Receiver of The First National Bank of Spartanburg, and had greatly reduced his judgment against James Anna Lawrence, deceased.
The plaintiff herein petitioned the Court to vacate its former decree and allow her to file a supplementary complaint and set up therein payment made upon judgments held by Albert L. Lohm, Receiver of The First National Bank of Spartanburg, one of the defendants. The request of the plaintiff was granted and she was allowed to file a supplementary complaint, which she did, and the defendants given twenty days thereafter within which to file their answer.
Thereafter a second order of reference was issued referring the matter to me for the purpose of taking testimony and reporting the same, together with my conclusions of all matters both of law and fact with leave to report any special issue. This order was dated August 24, 1938.
In pursuance to said order, I have held a reference and taken testimony, which is herewith filed along with my report and recommendation.
Lis pendens was filed with the Clerk of Court; defendants have been served with supplementary complaint and the defendants, Enoch Lawrence, John T. Lawrence and H.E. Lawrence, executors of the last will and testament of James Anna Lawrence, deceased, filed their answer to the supplementary complaint, and all parties are now properly before this Court.
The defendants, Fae L. Tindall and Willie Mae L. Bishop, were made party defendants, because they were alleged to hold mortgages similar to that of the plaintiff, except as to the amounts of their mortgages.
The mortgage that is sought to be foreclosed purports to have been given to the plaintiff to secure a note introduced into the evidence at the reference bearing date of November 5, 1930, in the amount of Two Thousand Nineteen and 50/100 ($2,019.50) Dollars signed by Enoch Lawrence and James Anna Lawrence, executor. The mortgage was dated March 11, 1927, and was for the sum of Seventeen Hundred ($1,700.00) Dollars, recorded in Mortgage Book 164 at page 13 R.M.C. office for Spartanburg County on March 12, 1927.
A mortgage of James Anna Lawrence, deceased, to her daughter, Carrie Waters, dated March 11, 1927, in the amount of Twenty Thousand ($20,000.00) Dollars and recorded on March 12, 1927, in Mortgage Book 164 at page 14 R.M.C. office for Spartanburg County.
Mortgages of James Anna Lawrence, deceased, to Fae L. Tindall and Willie Mae L. Bishop, sisters of the plaintiff, executed March 11, 1927, and recorded on March 12, 1927, in Mortgage Book 165 at pages 125 and 126 respectively, were all simultaneously executed in the office of Mr. L.G. Southard, an attorney at this bar, and were filed in the R.M.C. office for Spartanburg County for recordation on March 12, 1927, at practically the same minute.
The plaintiff and the defendants, Fae L. Tindall and Willie Mae L. Bishop are sisters, and grandchildren of James Anna Lawrence, and her husband, Enoch Lawrence, one of the defendants in this action. Their mother, Wavey Littlefield, was a daughter of James Anna Lawrence and Enoch Lawrence and died when these children were very young. Their grandparents took them at this tender age and reared them to womanhood. Mrs. James Anna Lawrence, their grandmother, giving them along with their brother, Broadus Littlefield, a valuable farm. The farm was later sold through this office in 1920, and the record shows that on or about the 9th day of July, 1920, Mrs. Lawrence, their general guardian, receipted the Master for the shares that belonged to the three minor grandchildren. Just what method of final settlement was made between herself as general guardian and these grandchildren, the evidence is vague. However, the records of the Probate Judge's office show that after due advertisement in the Spartanburg Herald, Mrs James Anna Lawrence was granted her discharge by the Probate Judge of Spartanburg County as guardian for Della Williams on November 26, 1921.
The defendants, Enoch Lawrence, John T. Lawrence and H.E. Lawrence, as executors of the estate of James Anna Lawrence, deceased, made answer to the supplementary complaint served upon them, denying the material allegations contained therein and alleged:
"1. That if any note was ever signed by James Anna Lawrence to the plaintiff as set forth in paragraph 1 thereof and secured by the mortgage described in Paragraph 2 of the Supplementary Complaint, neither the note nor the mortgage was ever delivered nor no consideration therefor, and are null, void and unenforcible.
"2. That if the note sued upon in paragraph 1 of the Supplementary Complaint and the mortgage described in paragraph 2 of the Supplementary Complaint were ever executed and delivered, they were based upon no consideration and absolutely void.
"3. That the plaintiff understood and agreed with Mrs. Lawrence that the mortgage was not to be delivered, that there was no consideration therefor and was made for the sole purpose of protecting James Anna Lawrence so her property could not be reached by Judgment."
As stated before the mortgage to the plaintiff along with mortgages to Carrie Waters, Fae L. Tindall and Willie Mae L. Bishop were all executed on March 11, 1927, simultaneously in the office of Mr. L.G. Southard, an attorney. There is not a particle of testimony that these mortgages were ever delivered to the parties they were made to and certainly not delivered to either Jesse C. Williams, the husband of the plaintiff, or to the plaintiff. The plaintiff contends the fact that the mortgages were recorded proves the delivery. There is a presumption of delivery from the fact of recording a paper, but where the evidence and circumstances are inconsistent with that presumption, the presumption must yield. The law governing the delivery of deed and mortgage is the same and it is essential to the validity of either that the party who executed them intended them to be delivered, and without delivery there can be no valid deed or mortgage.
A mortgage like any other deed to be valid and operative must not only be duly executed, but must be delivered by the mortgagor and accepted by the mortgagee or someone legally acting for him; without delivery it cannot take effect as a transfer of title or as a security. Burke v. Burke, 141 S.C. 1, 139 S.E., 209, 56 A.L.R., 729, 27 Cyc., 1114.
Prima facie delivery which is raised by the recordation of a deed cannot stand up when circumstances inconsistent with such presumption are established by testimony. Burke v. Burke, 141 S.C. 1, 139 S.E., 209, 56 A.L.R., 729.
Delivery rests not in words written, but in things done and said. Shute v. Shute, 82 S.C. 264 and 265, 64 S.E., 145.
I therefore hold and find, that the mortgage herein sued upon executed by James Anna Lawrence to Della Littlefield Williams on March 11, 1927, and the mortgages executed by James Anna Lawrence to Fae L. Tindall and Willie Mae L. Bishop on said date, were never delivered to them by James Anna Lawrence or by her to anyone for them, nor did she ever intend that they should be delivered.
I further find, that at the time this mortgage was executed by James Anna Lawrence to Della Littlefield Williams, it was executed as security for no debt or obligation of the mortgagor to Della Littlefield Williams and no debt or obligation was intended to be secured by the same. The purported mortgage was therefore without consideration, invalid and void.
A mortgage is different from other instruments in that, in order that it may be a valid instrument, there must be a debt or obligation of the mortgagor for which it is given to secure. Hinson v. Lancaster Mercantile Co., 117 S.C. 353, 109 S.E., 118; Warren v. Raymond, 17 S.C. 163; Gantt v. Gantt, 76 S.C. 163, 56 S.E., 676, and other decisions along the same line.
A voluntary deed may be good between the parties without any consideration, but not so with a mortgage. The word "Mortgage" means to secure something. Patterson v. Rabb, 38 S.C. 138, 17 S.E., 463, 19 L.R.A., 831.
I therefore hold and find, that the mortgages purported to be given on March 11, 1927, by James Anna Lawrence to the plaintiff, Della Littlefield Williams, Fae L. Tindall and Willie Mae L. Bishop, were without consideration and void.
I find from the testimony that the mortgage to the plaintiff, herein sued upon, and the mortgages to Willie Mae L. Bishop and Fae L. Tindall, defendants in this action, were executed by Mrs. James Anna Lawrence in pursuance with an understanding with Della Littlefield Williams, Fae L. Tindall and Willie Mae L. Bishop, for the purpose of tying up her property so it could not be reached by judgments as a result of actions of The Carolina National Bank against her, and they were without consideration and never delivered or intended to be delivered.
The testimony of Jesse C. Williams and the plaintiff, Della Littlefield Williams, that they were present at the time the mortgages were executed in Mr. Southard's office is sharply contradicted by the testimony. The fact that the mortgages were given by Mrs. Lawrence for the sole purpose of tying up her property so it could not be reached by judgment creditors is supported by the fact that on March 11, 1927, when they were executed in Mr. Southard's office, Mrs. Lawrence at the same time and place executed a mortgage to Mrs. Carrie Waters in the sum of Twenty Thousand ($20,000.00) Dollars, which was without consideration and later cancelled by the mortgage.
The judgments held by the Receiver of The First National Bank of Spartanburg, one of the defendants herein, against James Anna Lawrence are still partially unpaid.
I therefore hold and find, that the mortgage of the plaintiff herein sought to be foreclosed and that of Willie Mae L. Bishop and Fae L. Tindall to be null and void and of no effect, and as the plaintiff, Della Littlefield Williams, has stated her complaint that she is not asking for any deficiency judgment, I recommend that the complaint be dismissed with costs and the mortgages cancelled of record.
The decree of Judge Sease follows:
This action was commenced by Della Littlefield Williams in March, 1935, and was for the purpose of foreclosing a real estate mortgage alleged to have been given to the plaintiff under date of March 11, 1927, by the late James Anna Lawrence in the sum of Seventeen Hundred ($1,700.00) Dollars. The action is against Enoch Lawrence, John T. Lawrence and H.E. Lawrence, as executors of the last will and testament of James Anna Lawrence, deceased, Fae L. Tindall and Willie Mae L. Bishop were made party defendants because they held mortgages alleged to have been given similar to that alleged to have been given to the plaintiff except as to the amount. Albert L. Lohm, as Receiver of The First National Bank of Spartanburg and James W. Wolfe, as Receiver of The Citizens Bank of Inman, S.C. were also made party defendants because it appeared they had some claim against James Anna Lawrence. All of the parties were properly served and appeared. Lis pendens was duly filed.
The matter was referred to the Master for Spartanburg County by an appropriate order, in pursuance to which he held references and took considerable testimony; all of which was filed along with his report and recommendation February 17, 1936. This report on exceptions made by the plaintiff was confirmed by a decree of this Court. Notice of intention to appeal from the decree to the Supreme Court was given, but before the appeal was perfected due to the fact that certain real estate belonging to the estate of James Anna Lawrence, deceased, had been sold through an order of the Federal Court for the Western District of South Carolina, and the proceeds derived from the sale thereof had been applied to judgments held by one of the defendants, Albert L. Lohm, as Receiver of The First National Bank of Spartanburg, and had greatly reduced its judgment against the estate of James Anna Lawrence, deceased, the plaintiff herein petitioned the Court to vacate its former decree and allow her to file a supplemental complaint and set up payments on the judgment held by Albert L. Lohm, Receiver. The request of the plaintiff was granted and she was allowed to file a supplemental complaint, which she did. The defendants were given twenty (20) days thereafter in which to file answer.
The defendants, Enoch Lawrence, John T. Lawrence and H.E. Lawrence, as executors of the estate of James Anna Lawrence, deceased, in due time filed their answer. After denying material allegations of the complaint, they set up defenses as follows:
1. That if any note or mortgages as such as set up in the complaint were ever executed to the plaintiff or her co-defendants, Fae L. Tindall and Willie Mae L. Bishop, they were never delivered by James Anna Lawrence to them or either of them or to anyone else for them, and was never intended to be delivered by the said James Anna Lawrence.
2. That the alleged mortgage was without consideration and void.
3. That the mortgage was executed under an agreement between James Anna Lawrence and the mortgagees for the expressed purpose and the agreed purpose of tying up Mrs. Lawrence's property.
Thereafter a second order of reference was issued referring the matter to the Master for the purpose of taking additional testimony and reporting the same together with his conclusion of all matters both of law and fact with leave to report any special issue. This order was dated August 24, 1938.
In pursuance to said order the Master held reference, took testimony which he filed along with his report.
The matter now comes before me on exceptions made by the plaintiff to the report of the Master. After hearing argument of counsel and the testimony and after careful consideration and study of the issue, I hereby confirm the report of the Master in every respect and make it a judgment of this Court.
The Master held and found as a matter of fact that the mortgage alleged to have been executed by James Anna Lawrence to Della Littlefield Williams set forth in this action was never delivered by James Anna Lawrence to the plaintiff, Della Littlefield Williams, nor to anyone for her and that it was never intended to be so delivered and was so understood and agreed by James Anna Lawrence and the plaintiff, and in this holding and finding of the Master I concur.
The Master also held that the mortgages alleged to have been issued to Fae L. Tindall and Willie Mae Bishop were not delivered by James Anna Lawrence to the mortgagees and I concur in said finding.
It is true as found by the Master the alleged mortgages were recorded and raises a prima facie case, but this can not stand up when the circumstances are inconsistent with such presumption as established by testimony as was done in this case. Burke v. Burke, 141 S.C. 1, 139 S.E., 209, 56 A.L.R., 729.
Delivery rests not in words written, but in things done and said. Shute v. Shute, 82 S.C. 264, 64 S.E., 145.
A mortgage, like any other deed to be valid and operative, must not only be duly executed but must be delivered by the mortgagor and accepted by the mortgagee or someone legally acting for him and without delivery it can not take effect as a transfer of title or as a security. Burke v. Burke, 141 S.C. 1, 139 S.E., 209, 56 L.R.A., 729, 27 Cyc., 1114.
The Master had an opportunity to hear and observe the witnesses and was in a better position to determine and pass upon the facts as presented by the testimony, and I am satisfied with his findings of fact here and adopt them as a part of this decree.
The Master further found as a matter of fact that at the time this mortgage was executed by James Anna Lawrence to Della Littlefield Williams, it was executed as security for no debt or obligation of the mortgagor to Della Littlefield Williams and no debts or obligations were intended to be secured by the same and the purported mortgage was without consideration, invalid and void. I concur in this finding.
A mortgage is different from other instruments in that, in order that it may be a valid instrument, there must be a debt or obligation of the mortgagor for which it is given to secure. Hinson v. Lancaster Mercantile Co., 117 S.C. 353, 109 S.E., 118; Warren v. Raymond, 17 S.C. 163; Gantt v. Gantt, 76 S.C. 163, 56 S.E., 676.
I hold and find that the mortgage purported to have been given by James Anna Lawrence to the plaintiff, Della Littlefield Williams, and the mortgages given to Willie Mae L. Bishop and Fae L. Tindall on March 11, 1927, were executed by James Anna Lawrence in pursuance with an understanding and agreement with Della Littlefield Williams, Fae L. Tindall and Willie Mae L. Bishop for the purpose of tying up her property so it could not be reached by judgment as a result of actions of the Carolina National Bank against her and were without consideration and never delivered to the mortgagees or anyone for them nor were they intended to be delivered by the mortgagor, and are therefore null and void. The purpose for which they were executed would not have served any purpose if the papers had not been recorded.
It is therefore ordered and decreed, that the report of the Master by and the same hereby is confirmed and the Master directed to cancel the mortgages of Della Littlefield Williams, Fae L. Tindall and Willie Mae L. Bishop off the record, the said mortgages being the ones set forth in the complaint. That the complaint be dismissed with costs against the plaintiff. All exceptions are overruled.
Messrs. L.E. Wood and Carlisle, Brown Carlisle, for appellant, cite: As to presumption of delivery of deed: 116 S.C. 272; 108 S.E., 110. Validity of voluntary conveyance: 158 S.C. 379; 155 S.E., 594; 64 S.C. 413; 42 S.E., 184; 92 A.S.R., 809; 59 L.R.A., 319; 12 R.C. L., 597; 32 F.2d 361. Delivery of deed: 141 S.C. 1; 139 S.E., 209; 56 A.L.R., 729; 117 S.C. 24; 108 S.E., 168; 93 S.C. 450; 77 S.E., 129; 74 S.C. 144; 54 S.E., 249; 40 S.C. 450; 19 S.E., 68; 2 Strob. Eq., 370. Proper party to complain of fraud: 120 S.C. 408; 113 S.E., 279; 76 S.C. 432; 57 S.E., 33; 19 S.C. 384. Right of subsequent creditor with notice to set aside conveyance: 12 Rich., 259; 26 Am. Dec., 192; 23 S.C. 89; 124 S.C. 415; 117 S.E., 424. Effect of immaterial alteration of note: 112 S.C. 457; 100 S.E., 359; 110 S.C. 459; 96 S.E., 690; 65 S.C. 308; 43 S.E., 667; 58 S.C. 178; 36 S.E., 553; 1 R.C.L., 967. Validity of mortgage where note avoided: 69 S.C. 540; 48 S.E., 537; 28 S.C. 406; 5 S.E., 842; 27 S.C. 166; 13 A.S.R., 633; 19 S.C. 257; 125 S.C. 493; 119 S.E., 180; 15 S.C. 505.
Mr. R.B. Paslay, for respondents-executors, cites: Delivery: 141 S.C. 211; 139 S.E., 409; 27 Cyc., 1114; 24 S.C. 596; 119 S.C. 153; 112 S.E., 85; 82 S.C. 264; 44 S.C. 364. Mortgage defined: 17 S.C. 188; 52 S.C. 140; 38 S.C. 147; 27 Cyc., 958; 27 Cyc., 962; 52 S.C. 133; 38 S.C. 138; 19 L.R.A., 831. Confirmation of findings of fact by Master: 189 S.C. 4; 199 S.E., 866; 188 S.C. 367; 190 S.E., 420; 190 S.C. 139; 2 S.E. (2), 531.
April 11, 1940. The opinion of the Court was delivered by
March 6, 1935, plaintiff filed her complaint against the named defendants for the foreclosure of a mortgage. There were answers by the executors of the last will of James Anna Lawrence, deceased, and C.H. Dixon, as Receiver of The First National Bank of Spartanburg, S.C. Thereafter Fae L. Tindall, Willie Mae L. Bishop and James W. Wolfe, as Receiver of The Citizen's Bank of Inman, S.C. were made parties defendant. All of the defendants filed answers. By consent of all parties, the matter was referred to LeRoy Moore, Esq., Master for Spartanburg County, under a general order of reference. In due time he filed his report, by which he recommended that the complaint be dismissed. The matter was heard by Hon. Thos. S. Sease, resident Judge of the Seventh Circuit, who, on July 28, 1937, filed his order confirming the report of the Master. In due time the plaintiff gave notice of intention to appeal. While the Transcript of Record was being prepared, the plaintiff filed with Judge Sease a petition setting forth that: "* * * since the filing of the decree of July 28, 1937, the Receiver of First National Bank had realized from a proceeding in Federal Court to marshall the assets of James Anna Lawrence a substantial amount, reducing the unpaid balance of the judgments held by the Receiver to an amount under $400.00, and alleging further that the Executors of James Anna Lawrence had on hand an amount more than sufficient to pay said balance, and praying `that the Court take cognizance of the facts above alleged as having occurred subsequent to the filing of the decree of His Honor, Judge T.S. Sease, of July 28, 1937, from which it appears that there is no longer any necessity for setting aside plaintiff's mortgage for the benefit of the said Albert L. Lohm, as Receiver of First National Bank of Spartanburg, S.C.; that the Court do set aside and re-open the said decree of July 28, 1937, with leave to your petitioner, as plaintiff herein, to file and serve a supplemental complaint setting out the facts alleged in this petition and praying for foreclosure of her said mortgage, and for such other and further relief as may be equitable and proper.'"
Judge Sease granted the order prayed for and plaintiff filed her supplemental complaint, to which the executors of James Anna Lawrence made answer.
April 22, 1939, the Master filed his second report, again recommending that the complaint be dismissed.
September 5, 1939, Judge Sease filed his decree confirming the Master's report and dismissing the supplemental complaint. From that order comes this appeal based upon fifteen exceptions.
The decree of Judge Sease sets out pretty fully the facts of the case upon which his findings are predicated, and states clearly his conclusions, and is satisfactory to this Court. Let it be reported.
The Master and the Circuit Judge concur in the findings of fact. The exceptions are largely based on the allegations that these findings were erroneous. It is the settled rule of this jurisdiction that when the Master and the Judge concur in such findings, they have the effect of the findings of a jury, and no appeal lies therefrom.
"`While this case was tried as one in equity, that is, the testimony was taken before a Special Referee and his findings reported to the court of common pleas, and passed upon by the circuit judge, it is unquestionably a case at law, and the rule in law cases must be applied. That rule is that, if the issue be legal, conclusions of fact as found by the Special Referee and approved by the circuit judge are not subject to review by this court, unless wholly unsupported by evidence, or unless it clearly appears that such finding was influenced or controlled by error of law. See Willard et al. v. Finch et al., 123 S.C. 56, 58, 116 S.E., 96, and cases therein cited; Carolina Savings Bank v. Ellis et al., 174 S.C. 69, 97, 176 S.E., 355; Weston v. Morgan, 162 S.C. 177, 160 S.E., 436; Dillon County v. Lane, 114 S.C. 494; 104 S.E., 184.'" Riley v. Berry, 189 S.C. 4, 8, 199 S.E., 866, 867.
"If the proceeding be considered as one in equity with a legal aspect as to the finding of fact, the rule in law cases may be said to apply. That rule is that, if the issue be legal, conclusions of fact as found by the master and approved by the circuit judge are not subject to review by this court. Rippy v. Smith, 77 S.C. 414, 57 S.E., 1097; Ross v. Jones, 58 S.C. 1, 35 S.E., 402, 36 S.E., 1; Willard v. Finch, 123 S.C. 56, 116 S.E., 96; Fant v. Easley Loan Trust Company [ 170 S.C. 61, 169 S.E., 659], supra." Carolina Savings Bank v. Ellis, 174 S.C. 69, 176 S.E., 355, 366.
Appellant alleges in some of her exceptions, which are directed against the first decree of Judge Sease, that it was error to hold in that decree, in confirming the Master's report, that "* * * the plaintiff had stated in her complaint that she is not asking for any deficiency judgment, the error being that the supplementary complaint contains no waiver of right to deficiency judgment * * *."
Appellant was allowed to file her supplemental complaint upon the grounds, as stated in her petition, of matters arising after the filing of the first report and decree. The question thus presented is now academic, since the Master and Circuit Judge have concurred in finding that appellant is not entitled to foreclose her mortgage and, hence, would not be entitled to a deficiency judgment. We concur in that finding.
The exceptions are overruled, and the judgment is affirmed.
MESSRS. JUSTICES CARTER and FISHBURNE and MESSRS. ACTING ASSOCIATE JUSTICES J. HENRY JOHNSON and E. H. HENDERSON concur.