Mason v. Hearne, 45 N.C. 88, 1 Busb. Eq. 88 (1852)

Dec. 1852 · Supreme Court of North Carolina

45 N.C. 88, 1 Busb. Eq. 88

MARTHA MASON against JOSHUA HEARNE.

Where A. tool? an absolute deed for a traot of land from B., and then executed an agreement in writing with C., reciting*that “ he had a deed for C’s land/5 for which he had paid the purchase money, and therein bound himself to make C. a deed on her paying back the said purchase money withiu two years; and it appearing thus, as well as from other facts, that A. was to hold the land merely as a security for his debt: — Held that C., upon her payment of the purchase money, was entitled in this Court to a re-conveyance of the land from A., and to an account for the rents and profits — the time of payment not being of the essence of the contract.

Cause removed from the Court of Equity of Stanly county, at Fall Term, 1852.

The plaintiff by her bill, filed 11th February, 1851, alleges that several years since, her father, John Mason, now deceased, contracted with one Henry Davis for the purchase of a small tract of land, at the price of fifty dollars. That her father, in his lifetime, paid Davis a part of the said purchase money, to wit, $20 ; and finding himself unable to pay the balance, transferred his claim to the plaintiff, who states that she then made an arrangement with the defendant, by which it was agreed that he should pay to Davis $30 : and become her surety to him in a note for $5.55, the balance due for the land; which arrangement was carried into effect, and the defendant thereupon took a deed to himself for the land, and executed the following agreement in writing with the plaintiff:

“No. Carolina, Stanly County, 13th Feb’y., 1843.

“Articles of agreement between myself and Martha Mason. “ 1 certify that I have a deed for her land to which I paid thirty “ dollars for the land, on which no lives, 50 acres, which I bind “myself to make her a deed for the same,*if the said Martha “ Mason pays me the thirty against the 13th day of February, “1845. J. Heaene.”

Afterwards, from time to time, the plaintiff states that she did work and labor for the defendant to the value of $19.05, (an account whereof is exhibited,) and having also taken up her note to Davis, she offered to pay the defendant the sum mentioned in the above agreement, and take a conveyance of the land — which he refused, saying “ that it was too late.” That she still remained (with her mother) in possession of the land, and the defendant brought ejectment against her and turned her out of possession ; and further, that he had sued out a warrant against her for the rent of the premises, and recovered judgment thereon for $25— on which judgment he entered a credit of about $17, for the said labor and services rendered by her ; whereas she charges that she was not to pay rent, and that said credit should, according to their agreement, have been applied to the payment for the land. The plaintiff then states, that she afterwards, to wit, in September, 1850, made a formal tender in gold coin to the defendant, of the balance due him under their said agreement, according to the above showing ; and that he positively refused to accept the same and execute a deed to her. The prayer is that he be decreed to execute a conveyance, and for an account.

The defendant, in his answer, admits that “ he purchased the land of Davis ” — having before refused to become the plaintiff’s surety for the purchase money; and he admits the agreement with her, above set out; but he avers, that she failed to pay the $30 therein mentioned within two years ; and that remaining in possession, she agreed, soon after her father’s death, to pay him for the rent of the premises $5 per annum. That after her default, he did bring ejectment against her and evicted her; and also that he sued out a warrant and obtained judgment against her for $25, on account of said rent, and credited the same, as charged in the bill, for her work and services rendered — -which he insists he had a right to do, under their said agreement.

■ As to the first alleged tender, he denies that the plaintiff ever offered to pajr him, until after the expiration of the two years, the time mentioned in the above contract, and after ejectment brought against her; and he admits, that in September, 1850, he did re-' fuse the tender as charged ; and he insists on his right in equity, as well as at law, to hold the land.

Replication was taken to the answer, and the parties took testimony, principally as to the fact of plaintiff’s agreement to pay rent, and as to the manner in which her payments to defendant were to be applied. *

J. H. Bryan, for the plaintiff.

No counsel for the defendant in this Court.

Pearson, J.

The plaintiff is entitled to the relief she asks for. The agreement in writing, signed by the defendant, shows upon its face that the real intention of the parties in the transaction was to create merely a security ; and for this purpose the legal title was conveyed to the defendant, in trust to secure the repayment of the thirty dollars, with interest, and then in trust to convey to the plaintiff. Such being the intention of the parties, time is not of the essence of the contract in this Court,- which is the principle upon which the Court allows an equity of redemption, after the estate at law has become absolute, in all cases where the intention was to create merely a security.

The defendant faintly denies that the deed to him was intended as a security, and insists upon the fact that his agreement is in the form of a condition; and that the condition has not been complied with, by a payment of the money, within the time fixed on. That is true ; but in all mortgages, the form is that of an estate to be void upon condition of the payment of money at a fixed day. This Court regards not the form, whenever the real intention was merely to secure the payment of money, and will, upon the ground of the intention, relieve against the forfeiture of conditions and penalties. The intention that the conveyance should only operate as a security is conclusively established, not only upon the face of the agreement, but by all the other facts and circumstances of the transaction.

There must be a reference to the Master. In taking the account, the plaintiff will be entitled to credit for the amount paid by her, and also for the profits of the land since the defendant has been in possession, including the amount collected by him under his claim of rent.

Per Ctjuiam. Decree accordingly.