Case ID: ky_116/html/0975-01.html
Source: Caselaw Access Project
Author: {"author": "CHIEF JUSTICE BURNAM", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Case 105 — Action by Nora Malone’s Committee against Lewis Lebus to Recover an Annuity in Land Claimed .to be Due his Ward.
    Dec. 4.
    Malone’s Committee v. Lebus.
    APPEAL FROM HARRISON CIRCUIT COURT.
    Judgment for Defendant and Plaintiff Apeeals.
    Reversed.
    Gifts — Delivery—Acceptance—Vendor and Purchaser — Recorded Liens.
    Held: 1. Where a deed recited -that part of the consideration was a note, with interest payable aniiuualKy, for the use) of a certain person, during her life, there was a valid gift of the interest, though the note was not delivered to the donee.
    2. Where thel donee of a gift inter vivos is of unsound mind, the law will presume an acceptance.
    3. Where a recorded deed showed that -part of the consideration was a note, the interest on which was payable for the use of a certain person during her life, and a lien was reserved as security for the note, a subsequent purchaser was hound in the same manner as the first purchaser.
    D. BRADLEY SHAWHAN, attorney for appellant.
    On April 30, 1872, Caleb Jones, an uncle of the ward of appellant, Nora Malone, in order to secure her an annuity for life, did, by a deed of conveyance of a small lot in Cynthiana, Kentucky, reserve to her such an annuity of eighteen dollars, payable as the interest on the balance of purchase money unpaid which interest by the terms of the deed was made payable for the first time on June 1, 1873, and on said date annually thereafter.
    By a series of subsequent conveyances, the .appellee, Lewis Le-bus, became the .purchaser of said lot, none (of the interest and no part of this annuity has ever been paid, the beneficiary being still alive, the principal is not due. Nora Malone, the beneficiary under said deed, was) then and has ever since been a mute and wholly without mind, and has been SO' adjudged. These facts all having been set out in the .petition, a demurrer was sustained thereto' by the lower court from which ¡ruling this appeal is prosecuted.
    
      fWe claim the court erred:
    1. Because Nora Maione was given .the property to which she asks the court to restore her.
    3.She was deprived) of it through no fault -of hers, and evidence of it lost apparently through fraud of others.
    3. Time can not run, so as to bar her right on account of the alleged continuing disabilitiy.
    4. If time should run, it can -only become operative as a bar to so much of it -as was due more than fifteen years- before action was instituted for its recovery.
    5. Because it is an -action to -enforce performance -of an undertaking in writing -and as evidenced by deed of record and constituting notice -to defendant, which he sh-o-uld be estopped -to deny.
    6. Because -no- part -of the said interest has ever been paid her since said date, June 1, 1873.
    7. Because note is not yet due, and she should be entitled <to -have her rights thereunder restored to her -and secured by lien as originally contemplated.
    AUTHORITIES CITED.
    Civil Code, Ky., secs. 35, 93; Kentucky Statutes, secs. 2514, 2525; Jones on -Lien-s, vol. 2, secs. 1094, 1098, 1083, 1084; Pomeroy’s Equity Jurisprudence, vol. 1, sec. 112, v-ol. 2, secs, 591, 6S8, 692; Maupin Marketable Title to Real Estate, p. 240, sec. 104; Tiedeman on Real Property, sec. 271; Rankin v. Turney, 2 Bush, -555; Boar v. Jolly, 5 Bush, 8-6; Chiles v. Drake, 2 Met., 146; Davenport v. Prewitt’s Admr., 9 B. Mon., 96; Mize v. Barnes, 78 Ky., 506; Powell’s Admr., v. Minor and Dixon, 11 Ky. Law Rep., 286; Pritchard v. Warner’s Assignee, 4 Ky. law Rep., 349; Honores Exor. v. Bakewell, 6 B. Mon., 67; Tiernan v. Thurman, 14 B. Mon., 224; Pryse v. McGuire, 81 Ky., 60S; Johnson v. Gwathmey, 4 Liftell, 319; Thornton, etc. v. Knox’s Ekor., 6 B. Mon., 74; Woodward v. Woodward, etc., 7 B. Mon., 116; Cardova v. Hood, U. S. Supreme 'Court Reports, book 21, L. ed., foot p. 588.
    LAFFERTY & KING, attorneys for appeixee.
    1. The plaintiff sues on a note but -didn’t file it, and we claim it is -shown -to have been -paid in the conveyance made July 1, 1873, by 'Caleb Jones’ vendee, Whitaker tp -Curry, which depd shows it was a part of that consideration surrendered and cancelled; an-d when appellant filed that deed, he filed a receipt against the note.
    
      2. It is not shown that the note was ever delivered to her or to any one for her, nor was there any consideration for it.
    3. When Jones surrendered the $300 land note signed by Whitaker, and it was cancelled, such -delivery vitiated the lien, and when appellee examined the title to the property when he bought it in 1898, and found this old note was executed in 1872, cancelled in 1873, wf record, he was secure against any lien for same upon the land.
    4. The statute bars this nóte and if fraud existed as alleged, that plea can not now be raised after thirty years.
    AUTHORITIES CITED.
    ■Kentucky Statutes, see. 2519; Lewis, -&c, v. Carr, &e., 6 Ky. Law Rep., p. 429; Phillips, &c. v. Shipp, &C., 5 Ky. -Law Rep., p. 460; Barclay, &c. v. Goodloe, Exor., 5 Ky. Law Rep., p. 936; Brown v. Brown, 12 Ky. Law Rep., p. 280; Dorsey, &c. v. Phillips, &e., 13 Ky. Law Rep., p. 405; King v. Graham, 13 Ky. Law Rep., p. 488; Kentucky Statutes, sec. 2358; Lawson v. Biller, 10 Ky. Law Rep., p. 80; Collins v. Shinkle, 11 Ky. Law Rep., p. 365; Wilson v. Scott, 11 Ky. Law Rep., p. 370, Wilson v. S'eott, 13 Ky. Law Rep., ,p. 926.
   Opinion op the court by

CHIEF JUSTICE BURNAM

— Reversing.

On tbe 30th day of April, 1872, Caleb Jones and wife conveyed by general warranty deed to Munroe D. Whitaker a small tract of land in the town of Cynthiana. The consideration therefor recited in the deed is as follows; “The said party of the first part for and in consideration of the sum of $350.00, of which $50.00 is in hand paid, and a promissory note for $300.00 with interest at six per cent, per annum, payable annually from the first day of June,. 1872, for the use of Nora Malone during her life, and at her death to Caleb Jones, but should she die within four years from this date the principal is not to be paid until the end of that time.” And a lien was reserved on the lot as security for the -payment of the $300 note. On the 1st day of July, 1873, Munroe D. Whitaker and wife sold and conveyed this tract of land to James R. Curry by .general warranty deed for the recited consideration of $50 cash, and the surrender of Whit- . aker’s note to Caleb Jones for $300, dated June 1, 1872. On the same day Curry and wife sold and conveyed the land by general warranty deed to J. A. Fennell for the recited consideration of $350, $50 of which was paid in cash, and three notes, of $100 each, payable to Caleb Jones in one, two, and five years, respectively, with interest from date, executed for the remainder; a lien being reserved to secure the payment of the unpaid purchase money. On the 9th of March, 1887, ■N. B. Wilson, as executor of A. Fennell, and Mrs. Mary Fennell, sold and conveyed this tract of land to L. F. Struve for the recited consideration of $2,300, of which $1,150 was paid in cash, and for the balance of the purchase money a note was 'executed, due one day after date, and a lien retained to secure its payment. The deed contains no reference to the lien for $300 recited in the deed from Caleb Jones and wife to Mun-roe D. Whitaker. Bj’ a series of subsequent conveyances the appellee, Lewis Lebus, became the purchaser of this tract of land. On the 12th of July 1902, the appellant, P. P. Wyles, as committee for Nora Malone, brought this action in the Harrison circuit court, in which he alleged that Nora Malone had been from her birth a deaf mute, wholly without mind, dependant upon the charity of her uncle Caleb Jones for her support and maintenance; that on the 17th day of August, 1898, she had been adjudged by the Harrison county court, on the verdict, of a jury, to be an imbecile and of unsound mind; and that he had been duly appointed her committee, and accepted the trust. He also set out the various conveyances of the lot conveyed by Caleb Jones and wife to Whitaker in April, 1872, and alleged.that none of the installments of interest on the $300 note for which a lien was reserved in the conveyance of dones and wife to Whitaker had been paid to Nora, or to any one for her use and benefit, and prayed that the deed to the appellee, Lewis Lebus, the last vendee of the tract of land, should be corrected so as to set nut the reservation in her favor contained in the deed from Jones to -Whitaker, and for a judgment for $18, the interest as of the 1st day of June, of eac-h year from 1873 to1 1902, inclusive, with interest from their respective dates until paid. The defendant, Lebus, filed a general demurrer to the original and amended petitions, which was sustained, and plaintiff’s petition dismissed, and he has appealed.

It is contended for appellee that as plaintiff failed to allege that the $300 note was delivered to Nora Malone, or to any one for her use and benefit, or that Caleb Jones himself held it for her benefit, it was not a valid or enforceable gift, and that when the donor, .Jones, surrendered this note, and accepted in lieu thereof three notes, of $100 eac-h, in which no interest was reserved for Nora Malone, all claim for interest on the $300 note which she might have had terminated. It is also contended that the plaintiff’s claim, if it ever existed, is barred by the lapse of time and the statute of limitations.

To constitute a valid gift inter vivos of personal property, the gift must be voluntary, gratuitous, and absolute, and take effect at once, and ordinarily must be accompanied by a delivery of the thing to the donee, or to some one for her- use and benefit. But this is not always required. As said by this court in Williamson v. Yeager, 91 Ky., 286, 13 R., 273, 15 S. W., 661, 34 Am. St. Rep., 184: “If one delivers possession of personal property to a trustee to hold as a gift for the donee, it is a valid gift; and if he expressly says, or does acts amounting to the same thing, that he constitutes himself a trustee to hold the property for the donee, we perceive no reason why this should not be as valid and binding as a delivery of the property to a third person to be held for the donee.” And in Krankel’s Executrix v. Krankel’s Executor, etc., 104 Ky., 745; 20 R., 901; 47 S. W., 1084, it was said: “The general doctrine is well settled that a completed parol voluntary trust is enforceable, and, in order to render such a trust valid and enforceable, the donor need not use any technical words or language in express terms creating or declaring the trust, but must employ language which shows an unequivocal intention on his part to create or declare a trust in himself for' the donor.” The reservation in the deed from Jones to Whitaker of the interest on the $300 note for the use of Nora Malone during her life is unequivocal, and sufficiently explicit to create a valid gift thereof to" the beneficiary, Nora Malone; and, having been once made, it was beyond the power of Jones to thereafter revoke it without the consent of the donee. The note was not by its express terms' to mature during the life of Nora Malone, and at her death it provided that the principal was to be paid to the donor., It was therefore natural and proper that he should have retained its possession. Besides, if as alleged, Nora Malone was an imbecile or a person of unsound mind at the date of the gift, no acceptance thereof by her was essential to render it valid, as the law' will presume an acceptance on her part. See Pennington v. Lawson (23 R., 1340), 65 S. W., 120, and Bunnell v. Bunnell (23 R., 800-1101), 64 S. W., 420. A purchaser of real propeidy must look to the records for evidence of title, and when it is there shown to be incumbered with liens in favor of a third person, he is presumed to have purchased with such knowledge and subject to such conditions, and himself becomes a trustee for the beneficiary with respect to the property, and is bound in the same manner as the original trustee from whom he purchased. See Jones on Liens, secs. 1083, 1084, 2 Pomeroy’s Eq. Jur., sections 581, 688; and Johnston v. Gwathmey, 14 Ky., 317, 14 Am. Dec., 135. Nor is appellee’s contention that appellant’s claim is stale and barred by the statute of limitations maintainable — at least in so far as her claim to the annually accruing interest is not within the statute.

For reasons indicated, the judgment is reversed and cause ¡remanded, with instructions to overrule the demurrer, and for further1 proceedings consistent with this opinion.

Petition for rehearing by appellee overruled.