Tucker v. White, 22 N.C. 289, 2 Dev. & Bat. Eq. 289 (1839)

June 1839 · Supreme Court of North Carolina

22 N.C. 289, 2 Dev. & Bat. Eq. 289

WILLIAM M. TUCKER et al. vs. LEWIS WHITE et al.

A judgment creditor can only redeem upon the footing of shewing a good subsisting mortgage, which the mortgagor could go into a Court of Equity and redeem. The right of the creditor is founded originally on the idea of tacking, so that the mortgagor cannot redeem from him, without paying both the morgage money and the judgment debt. If, therefore, the mortgagor be excluded from the redemption, it cannot be open to his creditors — at all events, only under very special cir- ■ cumstances, if at all.

A mortgagor, and consequently his judgment creditor, cannot, since the act of 1826, 1 Rev. Stat. eh. 65, sec. 14, redeem a mortgage, after the lapse of the periods therein mentioned, from the time when the right of redemption accrued, that Is, in the case where no day of forfeiture was fixed, from the lime when the mortgage was created.

The bill was filed on the 18th day of September, 1835, and stated, that the defendant, Lewis White, became indebted to the plaintiff, for the price of a tract of land, in the sum of $1,200; for which he gave two bonds, dated the 20th March, 1819, for $600 each, payable, the one on 1st. December, 1819, and the other on 1st December, 1820: that on the bond first due, the plaintiff obtained judgment, at law, on the 12th of June, 1820, for principal, interest and costs: that five days preceding, viz: on the 7th of June, 1820, Lewis White, upon the pretence of owingto one Duke Gwin, the sum of $1,781, conveyed to one Absalom Bostick, as trustee, eight slaves, being all White had, to secure the same, with authority to sell the slaves at any time afier the 1st of December, 1820, upon ten day’s notice: that, in fact, White owed to Duke Gwin nothing, or, if any thing, a much smaller sum than that mentioned in the deed: that the deed was acknowledged by the parties, at the court in which the plaiti-tiff got judgment, and was registered; but that Du!;e Gwin a^erwar^s endorsed on it a credit for $1,280:80, as of the 7th of June, 1820, the date of the deed: that the deed of trust was contrived by the parties thereto, to defeat and defraud J 1 7 the creditors of White, and particularly the plaintiff; and that this also was known to Thornton P. Gwin, who was the father of said Duke: thatafter the plaintiff gothis judgment, White sought to be relieved from the contract, in the Court of Equity, and to that end obtained an injunction; and that Duke Scales was White’s surety therefor: that the injunction was dissolved, and the plaintiff obtained satisfaction, by selling, on the 12th of December, 1820, on his execution from the Court of Equity, four of the slaves mentioned in the deed of trust, of the price of which a surplus of $102, remained in the hands of the sheriff. The bill further stated, that on the 11th of December, 1820, Abraham Bostick, the trustee, set up to sale the remaining four slaves, in one lot, under the deed, and they were purchased by Thornton P. Gwin, before mentioned, at the sum claimed by Duke Gwin, as being then due to him, which a little exceeded $500: that this sale was in further execution of the meditated fraud on White’s creditors, and intended to conceal it more effectually: that the said Thornton P. really paid nothing, but purchased upon a secret trust for White: as one proof whereof, it was stated that the slaves were sold for about half their value, which was the object of selling all together, instead of each separately, as desired by persons who were present and wished to bid.

The bill further stated, that, if the purchase of Gwin was not wholly in trust for White, it was upon an agreement between Gwin and White, that the latter might redeem the slaves, by paying the sum advanced by the former, and interest thereon; and that, in truth, the purchase and the conveyence were but a security for the sum actually advanced by Gwin; and as proof thereof, the bill stated that Gwin declared to several persons, while the sale was going on, that he proposed to purchase for White, and give him the privilege of redeeming, and, for that reason, requested those persons not to bid against him; and also, that by White’s direction, Gwin received on the next day from the sheriff, the surplus of $102, arising from the sale of the other slaves' under execution, to be applied towards the debt, for which the slaves purchased by Gwin were liable: the bill further stated that Gwin took the slaves into his possession, upon his purchase; but charged that it was only for the purpose of more completely deluding White’s creditors.

The bill further stated, that the plaintiff obtained judgment on his second bond, but was unable to raise more than a small part of the debt, as he did not then know, or suspect any unfairness or fraud in any of the transactions mentioned, nor that White had any right of redemption of, or interest in, the negroes; nor did any information upon those points reach him until May, 1835. The bill, in relation to that part of the case, stated, that in 1827, White, having been arrested by some creditor, took the oath of insolvency, and that the plaintiff believed him to be really insolvent, but at the period before mentioned, the plaintiff was informed of the preceding circumstances by a nephew of White, and that he afterwards applied to Gwin to let him in to redeem the slaves, which the latter refused, and at the same time he threatened, that unless he quietly went out of the State, he would be prosecuted for perjury in taking the insolvent’s oath; and thereby induced White to remove in 1832, to Tennessee: that upon receiving such information, and having his suspicions otherwise excited, the plaintiff sued out process on his judgment, which was then dormant, and revived it for the sum of $595:88, and sued out a writ of fieri facias thereon, and delivered it to the sheriff, who was unable to levy it, or find any other property of Lewis White, except the four slaves and their increase, purchased by Gwin as aforesaid.

The bill was filed against Lewis White, and the executors and legatees of Thornton P. Gwin, who died before the suit was brought; and prayed that the deed of trust made by White and the bill of sale to Guin might be declared fraudulent and void as against the plaintiff; or if not, that it might be declared that said White had and hath a right to redeem the slaves, and that he might be decreed to do so, or the plaintiff let in to do so in his stead; or, that the slaves might be sold, and the sum due to said Gwin paid tbereouf, plaintiff’s debt be satisfied out of the surplus; and to those ends, that all proper accounts be taken.

The defendant, Lewis White, did not answer nor" appear, and the bill was taken pro confesso against him.

The other defendants put in an answer, which stated that they had no knowledge of the debts from White to Duke Gwin, nor of the execution of the deed of trust, nor of their testator’s purchase; but that they had always understood, and did believe, that all those transactions were fair and honest, and were not intended to deceive or defraud any'credifor of White: they believed that White did owe to Duke Gwin the money for which the four slaves were purchased by their testator; and, if not, that their testator was ignorant thereof, and paid the sum of $531 — the amount of his bid — to the trustee or to the creditor himself, in good faith.

They further stated, that they were ignorant of any agreement for redemption, between White and their testator, and never heard their testator admit that any such existed, nor did they ever hear White himself claim such right of redemption, nor had any reason to believe, that it was understood between said parties, that White could redeem. On the contrary, the answer averred that the defendant’s testator took from the trustee an absolute conveyance, and always had possession of the slaves, claiming according to the terms of his deed: and it insisted that the said Thornton P. Gwin, and these defendants under him, had had possession under his purchase, from the time it was made in December, 1820. to the filing of this bill in September, 1835, claiming the said slaves adversely and absolutely, and without, in any manner, acknowledging any right in the said White, or the said White’s in any manner setting up such right or claim; and thereupon relied on the lapse of time, and on the statutes of limitations as if pleaded.

To these answers, the plaintiffs put in replications; and the parties having completed their proofs, brought the cause to this court to be heard.

Badger for the plaintiffs.

.Boyden for the (defendants.

Ruffin, Chief Justice,

having stated the case as above, proceeded as follows: Without statins: the evidence ulariy, it is sufficient to declare that the Court is satisfied, from it, that the statements of the bill of the fraudulent intents of the deed of trust from White to Bostick, and of the want of a consideration in that transaction, or in the subsequent sale from Bostick to Gwin, are not supported, but unfounded. The plaintiff has himself examined Bostick, and he declares his belief throughout the transactions and up to the time of giving his deposition, that the deed was a security for sums really due to Duke Gwin, or responsibilities incurred by him; and he says further, that he made the sale fairly, and that Thornton P. Gwin paid the sum he bid, namely. $531. In all this, that witness is supported by Duke Gwin, who has been examined by the defendants; and no witness testifies any thing to the contrary. The only circumstance of a contrary tendency is that of the credit on the deed of trust for $1,280:80, of even date with the deed. Neither party asked an explanation of this entry from either witness; and, by itself, it is not sufficient to overthrow the direct as-severations of those two witnesses as to the good faith of that instrument. If the entry was made at the time it bears date, it could not have been deceptive, because it is the same with the date of the instrument; and, when it was acknowledged and registered, would shew that too large a sum had been inserted, by mistake in drawing the deed, or that the debt had been reduced before the deed was executed. From the amount of the credit, however, it is probable the entry was made afterwards, and with the view of regulating the computation of interest, was dated back. It appears in the bill, that Duke Gwin was the surety for White for an injunction against the judgment on a bond for this plaintiff for $600; due 1st December, 1819; and, profiably, the penalty ofthe injunction bond would be about $1,280: Now, the bill states that the sum due on that judgment was raised by the sale of part of the negroes by the sheriff; and, consequently, it ought not to be raised again out of the other negroes, if this deed was really intended as an indemnity to Duke Gwin for that responsibility. He may. therefore, Kkve entered the credit just before the sale by the trustee, as a discharge of the trustee fr°m *^nty raising so much from the remaining ne-groes, or of suing the sheriff. We can, indeed, only conjecture, at this day, how the truth was. But, at all events, a 3 J 3 . 3 3 circumstance, from which inferences may be deduced so consistent with innocence, ought not to serve as proof of a fraud. In our opinion, therefore, it must be declared, that the deed to Bostick and the sale by him were fair and good, as against the plaintiff.

Wheiher one can file a bill in the character of creditor ofa person stated to be a m'-rt^or, pTse'ofPi'e-ind ict i» to ■without alimiuin^ in, the mortgagee a "ood title, •wouicfseem to be incon-tbe scope sDch°abm°fl theTtie'of the person theredemp-sought.

R ma7 ke a question, whether one can file a bill in the character of a judgment creditor of a person stated to be a _ , ° , . , \ . . , mortgagor, for the purpose ot being let in to redeem, without vtn§ to> or admitting in, the mortgagee a good title. It Would seem to be inconsistent with the scope and obiect of . so such a bill, to impeach the title of the person from whom the redemption is sought; and, perhaps, for that reason, we should proceed no further in this case. But. we think it best to pass this point, since it is always more satisfactory to dispose °f a cause upon its merits, or upon some point that would govern the decision, if the litigation should be renewed. In ° ° , . , our opinion, there is such a point in this case, which must always be fatal to the claim of the plaintiff, in whatever form r-jight be presented. Our allusion is to the effect of the lapse of time under the provisions of the act of 1826, ch. 28, Rev. St. ch. 65, sec. 14, as a bar to the plaintiff, although ^ sh°u^ be admitted there was an agreement for redemption between White and Gwin.

Upon the existence of such an agreement, as a question of fact, the Court entertains, upon the evidence, a confident belief in the affirmative. It cannot be positively denied, any more than admitted, by the defendants, as they were not parties to it. They leave the plaintiff to his proof; and the plaintiff does prove, by two witnesses, that T. P. Gwin expressly informed them that he wished to purchase for the benefit of White, who was to have the power of redeeming; and that he requested them, therefore, not to bid against him, and they accordingly desisted. Besides this direct evidence, there is the circumstance. — vevy extraordinary, upon any other supposition — that $102 of White’s money was received from the' sheriff, and applied in part of the purchase money Gwin ought to have paid. An agreement for redemption also explains why White should have agreed to setting up the ne-groes in a lump, while persons desired them to be sold separately, and testify that, if they had been so sold, they would have brought nearly double the price they did.

But, supposing the mortgage established, we think the time is fatal to the plaintiff. A judgment creditor can only redeem upon the footing of shewing a good subsisting mortgage, which the mortgagor could come into this Court and redeem. The right of the creditor is founded originally on the idea of tacking, so that the mortgagor cannot redeem from him without paying both the mortgage money and the judgment debt. If, therefore, the mortgagor be excluded from the-redemption, it cannot be open to his creditor — at all events, only under very special circumstances, if at all. Such circumstances the bill professes to bring forward, by accounting for the delay; because the plaintiff thought the dealings between White and Gwin fair towards him, and had no suspicion to the con-, trary, until he received the information of White’s intent, just before the beginning of the present controversy. But none of those allegations are admitted; nor has the plaintiff offered any evidence of their truth. This bill must, therefore, stand exclusively on the right of White himself. Now, as to him, the act of 1826 is a clear bar. This case falls under the last section, which provides for mortgages theretofore made, and enacts that “ where the right of action has accrued within' less than ten years, the presumption of payment, satisfaction, or abandonment shall arise within thirteen years from the accrual of the right of action.” Here there does not appear to have been any day of forfeiture fixed. The conveyance to Gwin was absolute upon its face; but there was a separate agreement between White and him, that he would convey to White, upon the payment of the principal and interest. That, either could have insisted on, in this Court, immediately. Of course, the time began from Gwin’s purchase, on the 11th day of December, 1820, and expired according to the statute, on the 11th day of December, 1833 — -nearly two years before the bill was filed. It is charged, however, that advantage was taken by Gwin of the criminality of White, in falsely taking the insolvent’s oath, to terrify him from an attempt to re(^eem> an<^ in<Iuce him to leave the State. But the plaintiff has offered no testimony of any undue means on the part of Gwin, to induce White to take such an oath, nor to make it the occasion of extorting from him the renunciation of his rights. In the absence of such evidence, the admitted feet that White did take the oath of insolvency, without making an assignment of any interest in these slaves, strongly corroborates the legal presumption from the lapse of time. It is not to be assumed that the oath was either corrupt or false; and, if not, then it establishes that the witnesses were mistaken, in supposing that there was an agreement for redemption; or that Gwin subsequently satisfied White for the equity of redemption; or that, for some other sufficient motive, the latter had abandoned the right. But, as the case goes off on this point of time exclusively, and White may have been ruled more by poverty than influenced by his own will, or the merits of the other party, the bill will be dismissed without costs.

Per Curiam. Bill dismissed.