OCTOBER 13, 1948.
Injunction. Before Judge Pomeroy. Fulton Superior Court. July 9, 1948.
Fine Efurd, for plaintiff in error.
Raymond M. Reed and Phillips Johnson, contra.
1. The general demurrer was properly overruled. A general demurrer to a petition will not be sustained if the facts entitle the plaintiff to any of the substantial relief prayed.
2. It is not error to overrule special demurrers to allegations of a petition, on the ground that such allegations are mere conclusions, where such conclusions are supported by facts alleged. And where grounds of demurrer are confusing and uncertain, since a demurrer must itself be free from defect, such demurrer will be overruled.
( a) Equity has jurisdiction to reform a written instrument, where there has been ignorance or mistake on the part of one of the parties, accompanied by fraud or inequitable conduct on the part of the other party. If the fraud or inequitable conduct complained of consists of an alleged misrepresentation of fact, it is immaterial whether the party making the misrepresentation knows it to be false or not; it is nonetheless fraud in law, even though not fraud in fact.
( b) In cases of fraud, equity will not cancel a conveyance under which a petition for cancellation must allege a tender of, or offer to restore by the plaintiff to his vendee, anything received under such instrument; but where the petition alleges that the defendant had been in possession, receiving the rents and profits of the premises, and that the correct amount due him be declared and set up, no formal tender of the actual amount which may be due the defendant is necessary. The petition alleged that no part of the consideration named in the deed had been paid. Therefore, there was nothing to restore as between the petitioner and the grantee. Where it is not shown that the defendant has made valuable improvements, and no rights of third parties are involved, the action will not be dismissed because of laches.
( c) The special demurrer, alleging that the plaintiff failed to set out grounds for equitable relief, and that before the plaintiff can seek equity she must first do equity, is without merit.
No. 16366. OCTOBER 13, 1948.
Ruby Mae Johnson brought suit against Robert S. Wellborn in equity for an accounting for rents on certain property situated in Cobb County, Georgia, alleging certain facts in two counts, and praying that Wellborn be restrained and enjoined from selling said property; that he be adjudged by the trial court to be holding said property as trustee for Ruby Mae Johnson, and be required to reconvey said property, or that, upon failure to reconvey, the plaintiff have judgment against the defendant for $3500; and further praying that on an accounting the defendant be allowed to retain out of any rents collected the amount that he, the defendant, had paid on the loan on said property; that the plaintiff have judgment against the defendant for the remainder of the amount that the defendant had collected on said property; and that the plaintiff have judgment against the defendant for $500 for her furniture; and for such other and further relief as the circumstances of the case may warrant. The defendant, to the original petition and to both counts 1 and 2, filed general and special demurrers; and before a hearing was had on these demurrers; the plaintiff filed amendments to her original petition. The defendant renewed the demurrers and filed additional special and general demurrers to the original petition and petition as amended. Upon the general and special demurrers being heard by Honorable Edger E. Pomeroy, trial judge, the general demurrer and each special demurrer of the defendant were overruled.
The plaintiff alleged that she was married to the son of the defendant, and that she had separated from the son because he had beaten her and one of her children and had threatened to kill her and had started to get his gun to carry out his threat. Believing in good faith that it was the plan and purpose of her husband to kill her and her children, and on account of her fear and apprehension of danger to herself and her children, she left her home and husband and went to live with some of her people at Carrollton, Georgia, on the counsel and advice of the defendant, who shared her fears and her apprehension of danger to herself and her children at the hands of his son.
It was alleged that the defendant always took sides with the plaintiff in difficulties with her husband ever since her marriage, and that the plaintiff had learned to count and lean heavily on the defendant for counsel and advice and to trust him and rely and act upon his advice.
The plaintiff alleged that she was the owner of a tract of land in Cobb County of the value of $5000, and by amendment it was alleged that said property was bringing in $25 per month rental; that the defendant was receiving said rental; and that there was an indebtedness against said real estate of $1400 due Southern Federal Savings Loan Association of Atlanta, payable in monthly installments of $20 per month.
The plaintiff further alleged: that she conveyed the property to the defendant on September 10, 1946, because the defendant falsely represented to her that she ought to convey said real property to him to hold for her to prevent her husband from requiring or forcing her to convey it to him; that the defendant advised the plaintiff that, unless she conveyed the property to him, her husband would require and force her to convey it to the husband so that he could sell the property and waste the proceeds thereof; and she did not know at the time she conveyed said property to the defendant that, in order for her to make a valid conveyance of her property to her husband, it would be necessary for the conveyance to be approved by the superior court; that the conveyance of said property was without consideration, except that the defendant was to hold it in trust for her, his daughter-in-law; that the recital of consideration of $50 therein was false, and the recital that the defendant assumed the balance of the loan against the property was also a false recital; that, on and prior to the date of the deed to the defendant, the defendant represented to the plaintiff that if she later, after conveying said property to the defendant, decided that she did not want said property back or was not able to keep up the payments thereon, he, the defendant, would pay her for her equity in said property; and that the fair market value of the equity in said property on September 10, 1946, was $3500.
On account of the plaintiff's nervous condition, with which the defendant was completely familiar, the plaintiff was in no mental or physical condition to transact any business when the defendant obtained said property from her, and the defendant knew it, and it was a betrayal of her trust in him to seize on this occasion to get her home from her.
It was further alleged: that the defendant represented to the plaintiff that he would take and safeguard her furniture, but, on the contrary, he disposed of the same, or has allowed the same to be disposed of, without the plaintiff's knowledge or consent; that the fair market value of the furniture was $500; that, approximately one week after the plaintiff conveyed said property to the defendant, she obtained employment, and called upon the defendant to reconvey said property to her, but the defendant failed and refused so to reconvey it; that the defendant, a few days after September 10, 1946, came to Carrollton and urged the plaintiff to return to her husband one more time, telling her at the time that they could occupy the house rent-free, and that if everything went along all right for a couple of years, he would see about what could be done with the house, but the plaintiff refused to go back to her husband, because she feared for her life, as she had been forced to leave once before when the defendant carried her home to her people in Carrollton to escape the wrath and abuse of her husband, and she did not feel that it would be safe to try to live with her husband any longer.
The plaintiff alleged that she had two children by the defendant's son, one 11 years old and one 8 years old, and that the defendant had seemed very much concerned about them when their father was abusing his family and driving the plaintiff from home.
On account of the confidential relationship existing between the plaintiff and the defendant, she had a right to believe in and rely upon the defendant's advice and representations. By reason of the facts the defendant fraudulently induced the plaintiff to convey her property by falsely representing to her that he was acting for her, whereas in truth and in fact he was acting for himself, and in breach of the trust he induced the plaintiff to have in him he has now wrongfully and in violation of his trust refused to reconvey the property to the plaintiff.
Count two of the petition was identical with count one, except with respect to paragraph 49 of count two, where it was alleged: that the defendant (plaintiff in error) induced the plaintiff to convey her home to him by falsely and fraudulently representing to her, when she was in such a mental state that she was in no condition to transact business, that she ought to convey her property to him to hold for her to prevent her husband from requiring her to convey it to the husband, and that the defendant advised her that, unless she conveyed the property to him, her husband would require her and force her to convey the property to the husband, so that he could sell it and dissipate its proceeds; but that, if she would convey it to the defendant, he would hold it for her and keep up the monthly payments thereon in order that it might be saved for her and her children, for whom the defendant professed a great interest and concern; that the defendant seemed to think or feel that it was his duty as the grandfather of his son's children to see that their father did not abuse them or the plaintiff, and that, in the event he did so, the defendant felt it his duty to make up to the plaintiff and her children for any such default and misdeed of the son of the defendant by helping them from time to time provide for themselves and by counselling and advising the plaintiff as if he were her own father; that the deed made to the defendant on September 10, 1946, should be decreed null and void, and canceled of record, because it was obtained by fraud; that said fraud consisted of the defendant's representation to the plaintiff that he desired the plaintiff to convey said property to him for the defendant to hold for the plaintiff, whereas in truth and in fact he desired her to convey said property to him in order that he might keep it for himself, and said fraud also consisted of the defendant's advising and representing to the plaintiff that, if she would convey said property to him to keep for her, it was his intention to reconvey said property to her on her request at any time she notified him that she was in position to take care of the balance on said property, whereas in truth and in fact it was the existing purpose, plan, and intention of the defendant at the time he made said representations to retain said property for himself and not reconvey the same to the plaintiff; and said representations that it was his intention to reconvey to her on her request were fraud, and the defendant was taking advantage of the trust the plaintiff reposed in him, and of the confidential relationship existing between the plaintiff and the defendant on account of the plaintiff and her children's relationship to the defendant's son; and that the plaintiff is entitled to an accounting from the defendant for rents collected from said property over and above the amount necessary to reimburse the defendant for the payments by him on taxes and the loan on said property.
1. The allegations of the petition were sufficient to set out a cause of action for cancellation of the deed based upon confidential relationship existing between the parties and allegations pertaining to fraud in the procurement of said deed. Jones v. Hogans, 197 Ga. 404 ( 29 S.E.2d 568).
Taking the allegations of the petition to be true, as must be done in considering general demurrers, the petition in both count 1 and count 2 set forth a cause of action, and it was not error to overrule the general demurrer thereto. Mullins v. Barrett, 203 Ga. 11 ( 48 S.E.2d 842).
A general demurrer to a petition will not be sustained if the facts entitle the plaintiff to any of the substantial relief prayed. Arteaga v. Arteaga, 169 Ga. 595 (4), ( 151 S.E. 5); McLaren v. Steapp, 1 Ga. 376; Dyson v. Washington Telephone Co., 157 Ga. 67 (3), 78 ( 121 S.E. 105); Blaylock v. Hackel, 164 Ga. 257 (5), ( 138 S.E. 333); Mullins v. Barrett, 204 Ga. 11 (supra).
2. The plaintiff in error filed 26 special demurrers to count 1 and 33 special demurrers to counts 2 of the original petition, and 16 special demurrers to counts 1 and 2 of the amended petition. In considering the special demurrers, we will group paragraphs 1 to 26 inclusive of the special demurrers to count 1 of the original petition, and paragraphs 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, and 30 (excluding paragraphs 12, 31, 32, and 33, which will be taken up separately) of the special demurrers to count 2 of the original petition, and also paragraphs 2, 3, 4, 5, 6, and 7 of the special demurrers to count 1 of the amended petition, and paragraphs 8, 9, 10, 11, 12, 13, 14, 15, and 16 of the special demurrers to count 2 of the amended petition, since these special demurrers attacked specified paragraphs of the petition on the ground that the allegations therein were mere conclusions, irrelevant and immaterial. The conclusions were supported by the facts as alleged in the petition, and the allegations attacked as being irrelevant and immaterial were necessary to show confidential relations existing between the parties.
It is not error to overrule special demurrers to allegations of a petition on the ground that such allegations are mere conclusions, where such conclusions are supported by facts alleged. And where grounds of demurrer are confusing and uncertain, since a demurrer must itself be free from fault, such demurrer will be overruled. Marietta Realty Development Co. v. Reynolds, 189 Ga. 147 (4) ( 5 S.E.2d 347); Western Atlantic R. Co. v. Roberts, 144 Ga. 250 ( 86 S.E. 933); Jefferson Fire Ins. Co. v. Brackin, 147 Ga. 47 (2) ( 92 S.E. 930).
( a) In paragraph 12 of the demurrer to count 2, the defendant demurs specially to paragraph 51 for the reason that said paragraph sets out conclusions of the pleader, attempting to set out as an excuse ignorance of the law. The petitioner alleges in paragraph 51 of count 2 that she "did not know at the time she conveyed said property to defendant that in order for her to make a valid conveyance of her property to her husband it would be necessary for the conveyance to be approved by the superior court." Code § 37-209 states: "Ignorance of law — Mere ignorance of the law on the part of the party himself, where the facts are all known, and there is no misplaced confidence, and no artifice or deception or fraudulent practice is used by the other party either to induce the mistake of law or to prevent its correction, shall not authorize the intervention of equity." This Code section does not prevent the granting of relief where all the facts are not known by reason of the fraud of one of the parties.
Equity has jurisdiction to reform a written instrument where there has been ignorance or mistake on the part of one of the parties, accompanied by fraud or inequitable conduct on the part of the other party. McDonald v. Mullins, 197 Ga. 511 ( 29 S.E.2d 507).
If the fraud or inequitable conduct complained of consists of an alleged misrepresentation of fact, it is immaterial whether the party making the misrepresentation knows it to be false or not; it is nonetheless fraud in law, even though not fraud in fact. Reese v. Wyman, 9 Ga. 430 (6); Gibson v. Alford, 161 Ga. 672 (2b), ( 132 S.E. 442). The trial court properly overruled the special demurrer to paragraph 51, count 2, of the petition.
( b) In paragraphs 31 and 32, the defendant demurs specially to paragraphs 77 and 78 of count 2 of the petition, for the reason that those paragraphs set out conclusions of the petitioner and fail to allege or show why the deed made by the plaintiff should be declared null and void and canceled of record, and fails to make a tender to the defendant for moneys paid by him for taxes, improvements, interest, and payment on the loan, as well as turning back the consideration paid by the defendant to the plaintiff. Paragraph 77 of count 2 of the petition reads as follows: "Petitioner therefore alleges that the deed she made to said defendant should be decreed null and void and canceled of record." Paragraph 78 reads as follows: "On account of the facts herein alleged petitioner is entitled to an accounting from the defendant for rents collected on said property over and above the amount necessary to reimburse defendant for the payments made by him on taxes and the loan on said property."
The Code, § 37-104, provides: "He who would have equity must do equity, and give effect to all equitable rights in the other party respecting the subject-matter of the suit." Ordinarily, before one would be entitled to have a deed decreed null and void and canceled of record, he must tender to the purchaser the amount alleged as the consideration. In the instant case, it is contended that the petition is subject to demurrer because the petitioner failed to tender to the defendant the moneys paid for taxes, improvements, interest, and payment on the loan, as well as the consideration paid by the defendant to the plaintiff. The petition as amended alleged that no part of the consideration named in the deed had been paid, and that the amount of the rent collected by the defendant was enough to have paid the installments and interest due against said property. There is nothing in the record to indicate that any improvements were made by the defendant, or any taxes paid by him. Where it is not shown that the defendant has made valuable improvements, and no rights of third parties are involved, the action will not be dismissed because of laches. The trial judge did not err in overruling these grounds of the special demurrer. In connection therewith, see Marietta Realty Development Co. v. Reynolds, supra; DeVaughn v. Griffith, 149 Ga. 697 ( 101 S.E. 794); Mullins v. Barrett, supra; Wynne v. Fisher, 156 Ga. 656 (2), ( 119 S.E. 605).
( c) In paragraph 33, the defendant demurs specially to paragraph 80 of the petition, for the reason that neither said paragraph nor any other paragraph sets out grounds for equitable relief, and before the plaintiff can seek equity she must first do equity. Under what has been previously ruled, this ground is without merit.
Judgment affirmed. All the Justices concur, except Bell, J., absent on account of illness.