Court Opinion

ID: 7815361
Source: CourtListenerOpinion
Date Created: 2022-09-07 17:34:10.341721+00
Date Added: 2024-06-11T16:30:35.119020
License: Public Domain

Paul Ward, Associate Justice, dissenting. There is one issue in this case which was not considered by the trial court or the majority making the opinion, and I think that issue calls for a reversal. The overlookedv issue to which I refer is set out in appellant’s brief as the 5th point: That the court erred in refusing to hold that if executed and acknowledged, the deed in question was in fact a mortgage. This court has held numerous times to the effect that if a deed (regular in form) was intended to secure a loan for money, equity will construe it to be a mortgage. In the recent case of Ehrlich v. Castleberry, 227 Ark. 426, 299 S. W. 2d 38, the court in speaking of the execution of a deed stated: “If such transaction is security for a debt, then it is a mortgage.” A headnote in Beloate v. Taylor, 202 Ark. 229, 150 S. W. 2d 730, expresses the rule this way: “If there be a debt subsisting between the parties to a deed, and it is their intention to continue the debt, the deed will be a mortgage. ’ ’ In Hudgens v. Taylor, 206 Ark. 507, 176 S. W. 2d 244, the court quoted from another decision, with approval, that- — “. . . in determining whether a deed absolute on its face is such, indeed, or only to be considered as a mortgage, the real question for the court’s determination is what was the intention of the parties at the time.” In this same connection the court said in Holman v. Kirby, 198 Ark. 326, 128 S. W. 2d 357, that if a deed is an equitable mortgage when executed it continues to be so. Applying the well-established rule that the testimony to change a deed to an equitable mortgage must be clear and convincing, it is in order to examine the testimony in this case. As I read the record the testimony here is not only clear and convincing but is uncontradicted, unchallenged, and admitted. On the point in question we have the testimony of only two witnesses. One is the grantor in the deed, appellant, and the other is the grantee in the deed, Mrs. Sarah Going. Appellant’s testimony is copied from the abstract: ‘ ‘ On the day before May 1st, 1950, Lambert told his mother he did not have any money and the bank was to foreclose the next day, May 1 and she said she would loan us the money and he could pay her back when he could. “He was up at that time and in high hopes of getting well. ' ‘ She agreed to let us have the money and that had to be brought on the next day. At that time they were to give her a mortgage. This was to be on the part of the property on which the Cafe was located and the little house would not be included in the mortgage. ’ ’ Mrs. Sarah Going’s testimony with relation to the issue, as copied from the abstract was: (speaking of her son Lambert). “He came over and told about the loan and would rather bump his brains out than ask for more money. If you would pay the bank off he would be awfully glad as he didn’t have a place to go. He said if you will I will deed you the property. “I feel that I can get it started and we CAN PAY YOU A LITTLE along and if we don’t you can put us out. ’ ’ Mrs. Going further testified: ‘ ‘ Q. They were both present? “A. Yes, sir. “Q. What was the talk about? ‘ ‘ A. He said (referring again to Lambert): ‘ Mother, they are going to foreclose on the property in Corning and I had rather bump my brains out against the wall as to ask you for more money for I have asked for so much.’ Sterline and both of them come and he said, ‘If you could pay the bank off I would be awfully glad for we won’t have a place to go.’ I said, ‘Well, I don’t know whether I can or not. ’ But anyway he said, ‘If you will, I will deed you the property and then we will have a place to stay for certain. We know you wouldn’t put us out and we can pay you maybe when I am able. ’ ’ ’ The only sensible conclusion I can draw from the above is that when Mrs. Going accepted the deed she did so knowing that appellant and her husband thought they had the right to pay her back and redeem the property. If I am right then the majority opinion condones and rewards Mrs. Going’s deception. An additional reason why I don’t like that result is that the entire dealings were among close relations, and also appellant, being under severe economic pressure was in no position to deal at arms length. Justice Robinson joins in this dissent.