Court Opinion

ID: 7994561
Source: CourtListenerOpinion
Date Created: 2022-09-09 01:35:18.155619+00
Date Added: 2024-06-11T16:35:29.847454
License: Public Domain

Sykes, J.
(dissenting).
In my opinion the decree of the lower court should be affirmed. As I view the testimony the question really presented was a controverted question of fact decided by the chancellor in favor of the appellee.
The appellant, Pennington, is a son-in-law of appellees, H. B. and Elizabeth Jenkins. The land in controversy originally belonged to the Jenkinses. For some reason they conveyed it to Pennington. Subsequently a controversy terminating in a lawsuit arose between these parties as to the ownership of the land. This was settled by an agreed decree vesting title in Pennington. It seems that as a part of the settlement it was agreed among the parties that Pennington should convey the lands to the Jenkinses for a consideration of forty-five thousand dollars. Because of the lawsuit the Jenkinses had become indebted to their attorneys and for expenses incident to the suit for about twenty thousand dollars. In carrying out this settlement the land was conveyed to the attorneys temporarily. All parties to this controversy held a conference the night before the deeds of trust here in question were prepared. At these conferences which took place in the office of one of these attorneys and also in the bank, all parties now before the court were present. The bank was present through its cashier, Mr. Rowland, the senior Jenkins, and his two sons were present, Pennington was present, and the attorneys. In these conferences the question of this settlement and the execution of the three deeds of trust and notes were all discussed and agreed upon. The testimony of the Jenkinses is to the effect that it was then agreed and understood that the bank was to have a first deed of trust to secure its loan of twenty thousand dollars to Jenkins, that the Jenkins boys were to have the second deed of trust on this property to protect them in case they were’called upon to pay the bank, and that Pennington was to have the third deed of trust for the forty-five thousand dollars due him. A majority of my brethren think the testimony is *37not sufficient to sustain this finding of the chancellor. This agreement, however, as above stated, was testified to by the three Jenkinses and was only controverted by the testimony of Pennington. As I view it, this was certainly a controverted question of fact to be decided by the chancellor and that the testimony of the three Jenkinses amply sustains this finding.
As to why Pennington was willing to agree to his deed of trust coming third instead of first, we are not concerned. It may be that he was anxious to get a family quarrel adjusted. It may be, and perhaps is true, that at the time this agreement was made all parties thought the land of the two old Jenkins people worth much more than the combined amounts of the deeds of trust being given thereon. However, there is no question but that Pennington had the right to make this agreement and accept a third deed of trust. ,And the testimony, in my judgment, sustains the finding of fact of the chancellor that he in fact did so agree. In this conference Mr. Rowland, the cashier of the bank, stated that he would have the three deeds of trust drawn and properly executed in accordance with the above agreement. . The next day these papers were so drawn by an attorney. The Pennington note and deed of trust were drawn to mature in 1926, as the testimony for the appellee states the agreement was. Rowland then took the papers to the tivo elder Jenkinses and told them in substance they were drawn in accordance with this agreement; that the bank held a first mortgage, and Pennington a third; that Pennington’s debt did not mature for five or six years. Relying upon this statement of Rowland, the two elder Jenkinses executed the papers. They were also at a later period in the bank executed by the Jenkins boys, who at that time also believed they carried out the agreement made by all parties.
The fact that Pennington’s deed of trust was first, recorded is in no way binding upon any of the parties to this controversy. The statutes relating to priority of recordation protect innocent purchasers or incumbrancers for *38value without notice and in no way affect or change any agreement between or among the original parties to these contracts. Consequently no rights were either lost or acquired because of the filing of these deeds of trust for record.
Mr. Rowland, the cashier of the bank, was the agent of the bank when he had drawn the note and deed of trust due the bank by the Jenkinses. He was not the agent of the bank, and the bank is in no wise bound by his action, in having prepared and executed the note and deed of trust of the Jenkinses to Pennington. It was no part of his duties, nor within the real or apparent scope of his employment, to have executed deeds of trust Avholly betAveen third parties. His act, therefore, in having drawn the Jenkins-Pennington deed of trust, could in no wise bind the bank. If he anted for any one in this matter, under this testimony, it was for Pennington and not the bank. I think there Avas ample testimony from which the chancellor Avas justified in findifig that the maturity of the Pennington note and deed of trust was altered after execution, the due date in both instruments being changed from 1926 to 1921. The burden of proof rested upon Pennington to show that the change was made before execution, and this he failed to do. The papers were in the possession of Rowland. If the change was made by RoAvland it would not be binding upon the bank, nor upon any party to this controversy if made without his knowledge or consent, but would be really a spoliation. The letter written by Rowland to Pennington in my opinion is in no wise an admission by the agent of the bank, but is merely written in his personal capacity about a matter that the bank was really not interested in; that is to say, the deed of trust of the Jenkinses to Pennington. The bank, however, of course Avas interested in the priority of this deed of trust. This priority, however, could not have been changed by Rowland in violation of the agreement of all these parties. Even, however, if this admission as to priority be considered an admission of interest against the bank, the four *39Jenkinses could not he bonnd by any such admission. The record shows that they are vitally interested in the priority of these deeds of trust, and the time' of the maturity of the Pennington note. The two Jenkins boys who .are liable for the indebtedness due the bank are certainly most vitally interested in knowing, that the bank holds the first mortgage. None of these-Jenkinses'could be bound by such an admission of the cashier of the bank. They have a right to insist that the priorities remain in accordance with the agreement and in accordance with the manner, in which the papers were executed. Consequently any admission on the part of the cashier of the bank, could in no wise affect the priority of these deeds of trusts..
As I understand the opinion of the majority, however, it is merely to the effect that the testimony is insufficient to sustain the decree and the cause is reversed and remanded generally. This being true, I refraim from going in detail' into all the testimony.
From these views it follows th¿t F think the testimony sufficient to sustain the finding of the chancellor that the hank’s deed of trust was first, that of the Jenkins boys second, and further that Pennington, holds a valid third deed of trust on this property, the debt maturing in- 1926', as evidenced by the papers before the spoliation.
Smith, C. J., concurs in this dissent.