Court Opinion

ID: 7053144
Source: CourtListenerOpinion
Date Created: 2022-07-24 07:02:58.787415+00
Date Added: 2024-06-11T16:11:50.403882
License: Public Domain

On Petition eor Rehearing.
McCabe, J.
The first point made for a rehearing is that we erred in the original opinion in following and adhering to the doctrine laid down in Wert v. Naylor, 93 Ind. 431.
That case concedes that he who takes a mortgage or conveyance as a security for the payment of a precedent debt is not a bona 'fide purchaser for value, as against the holder of a secret equity in the land, because he parts with nothing. But it holds that where he takes a conveyance of such land in payment and satisfaction of a precedent debt, that he is a bona fide purchaser for value, and entitled to hold such land, as against the holder of the equity of which such purchaser has no notice or knowledge.
While counsel for appellees do not deny that the rule thus laid down in that case is in harmony with the weight of authority elsewhere, yet they contend that, such rule is in conflict with other decisions by this court, and is unsound and unjust, and opens the door to great fraud, and impliedly insist that it ought to be *98overruled. We have already seen in the original opinion that the case is not in conflict with our other cases.
The fraud to which they claim that the doctrine there laid down opens the door is that the holder of an equity in the land may be deprived of the entire value or purchase price paid for the land, where he has not taken a deed by one who, ignorant of such equity, and who takes the land in payment and satisfaction of an antecedent debt; that is to say, the one who has thus taken a deed, by one who ignorant of such equity, and changed his position, because he has parted with no value, as they contend, and hence not a bona fide purchaser. And it is insisted, in effect, that if the holder of the equity is allowed to enforce his equity and hold the land, the purchaser in consideration of the antecedent debt, has lost nothing, because he may then enforce his debt, though he may have surrendered and cancelled the evidences thereof, for the reason that •the consideration which he was to receive therefor has failed. But that is a mistake. He may have taken a quitclaim deed, and in any event he receives a conveyance of the legal title to the land. This cannot be said to be of no value whatever. If by warranty deed, he has the warranty of title of his grantor.
It is said in Hardesty v. Smith, 3 Ind. 39, that: “When a party gets all the consideration he honestly contracted for, he cannot say he gets no consideraion, or that it has failed. If this doctrine be not correct, then it is not true that parties are at liberty to make their own contracts.” This language was quoted by Elliott, J., speaking for this court in Wolford v. Bowers, Admx., 85 Ind. at page 296, where it is further said that: “The same principle is declared and enforced in many of our own cas'es. Kernodle v. Hunt, 4 Blackf. 57; Harvey v. Dakin, 12 Ind. 481; Baker v. Roberts, 14 Ind. 552; Taylor v. Huff, 7 Ind. 680: *99Louden v. Birt, 4 Ind. 566; Smock v. Pierson, 68 Ind. 405, 34 Am. Rep. 269; Neidefer v. Chastain, 71 Ind. 363, 36 Am. Rep. 198; Williamson v. Hitner, 78 Ind. 233.” And we add Laboyteaux v. Swigart, 103 Ind. 596; Price v. Jones, 105 Ind. 543; Keller v. Orr, 106 Ind. 406.
When, therefore,, land is conveyed by the owner to another in payment and satisfaction of a debt due from the owner to that other who is ignorant of an equity in the land in favor of a third person, the en: forcement of that equity against the land does not revive the indebtedness for the payment and satisfaction of which the land was conveyed. Therefore, a purchaser of land in consideration of the payment and satisfaction of a debt due the grantee is as much a bona fide purchaser for value, as if he had paid cash. And if he is not to be protected as such', the rule which appellees’learned counsel invokes and asks us to adopt opens a wider door for wrong and fraud than the rule laid down by this court in Wert v. Naylor, supra, which he asks us to overrule. We think we ought to adhere to the rule laid down in that case.
The only other point made for a rehearing is that we erred in holding that “we are bound to presume that there was evidence to which each one of the features of the instructions mentioned was applicable.” Counsel for appellees contend that the bill of exceptions affirmatively shows that there was no evidence to which the erroneous instructions were applicable, and hence that it was harmless. It, however, rarely happens that instructions that are wholly inapplicable to the case made by the evidence are harmless. In Blough v. Parry, 144 Ind. 463, and the numer. ous cases there cited, such instructions were held harmful.
This appeal being prosecuted on the correctness of *100the instructions given and refused, under section 662, Burns’ R. S. 1894 (650, R. S. 1881), the trial court certified that the instructions given and refused were applicable to the evidence without setting out all the evidence in the record.
The instructions on which we reversed, were instructions given, and not those refused. We there held, as had been previously held, that the section of the statute cited made no change in the practice as to instructions given, as the presumption always must be. in the absence of the evidence, that instructions given were applicable to the evidence. But, in addition to that presumption, the trial court has certified in the bill of exceptions incorporating the instructions, “that the instructions given by the court, as above stated, * * were each and all applicable to the evidence in said cause.”
Appellees’ counsel, however, insist that the presumption and certificate of the trial judge that the instructions were applicable to the evidence are overcome by the following evidence and recital contained in the same bill of exceptions not purporting to contain all the evidence, to-wit: “Mr. Reeder testified * as follows: * * you may state what the fact is as to whether Jesse M. Reed purchased those lands of you, or whether it was by reason of liabilities that he had assumed for you? Answer. It was on account of Mr. Reed having indorsed for me and I wanted to make him safe. He was related to my wife. He was a cousin to my wife, and I deeded him the land with the understanding that at some time, if ever I got able to, that I should pay him for all that he had paid for me, and redeem the land.’ And this was all the evidence on the subject of the consideration for the land deeded from Reeder to Reed.” This is not sufficient to overcome the direct statement in the bill of exceptions that *101the instructions were applicable to the evidence; at all events, one statement is as strong as the other. That is as favorable to the appellees as they have a right to ask. Even if we construe the last statement quoted as directly conflicting with the first, which is as favorable to appellees, if not more so, than they have a right to ask, then we have both statements completely nullified. That being so, the presumption that the instructions given were applicable to the evidence must prevail. But, as before observed, it does not relieve the appellees from the consequences of the erroneous instructions by showing, even if we concede that to be the case, that they were not applicable to the evidence.
We see no way of escaping the consequences of giving the erroneous instructions.
Petition overruled.