Weaver v. Paragon Construction Co.

Marbury, C. J., delivered the opinion of the Court. Appellants in this case filed a bill of complaint in the Circuit Court for Montgomery County, asking the court to pass a decree directing the appellee, Paragon Construction Company, Inc., holder of a note secured by a deed of trust, to surrender that note to the complainants, and directing the trustees in the deed of trust to deliver to the complainants a release of that trust. The court was also asked to pass a decree declaring the deed of trust to be null and void, and not to constitute a cloud upon the title of the land vested in Evelyn K. Morgan, one of the complainants. The defendants answered, testimony was taken, and the court passed a decree dismissing the bill of complaint.

From this decree the complainants appealed here. The facts in the case are quite complicated. They are stated in the following words by the chancellor: “On December 11, 1947, Charles A. Weaver signed a contract to buy 41% acres of land from Josiah Carr for $47,000.00. The land was in tracts of 27 acres and 14% acres.

The seller was to take back a deed of trust on the 27 acre tract and on.one acre in the 14% acre tract, leaving 13% acres to be conveyed clear to the purchaser. The sale was not immediately consummated, apparently the seller refused to go through with it. However, it appears that Weaver induced Dorothy Lee Ward, a patient of Weaver’s to promise to furnish the amount of money required as a down payment. Weaver brought Mrs. Ward to the office of the attorney representing him.

There she made the statement that she had to have further security for her money. Weaver had no money to put in the transaction. On May 20, 1949, Weaver and wife entered into a written agreement with Mrs. Ward. Mrs. Ward by this agreement was to have seven acres in the second tract deeded to her, she was to put up $16,250..00, the ²⁰⁷ Weavers agreed to promptly have the seven acres subdivided into lots, blocks and streets, costs to be borne equally by the parties, and the Weavers agreed to purchase within two years all of the lots at $1,500.00 per lot.

And it was further agreed that the Weavers would execute a mortgage on the remaining 7% acres (6% acres actually being the correct number of acres) in the second tract, to secure to Mrs. Ward the $16,250.00, payable on or before two years, and ‘that said mortgage shall be additional security for the money paid under this contract and all payments for sales of lots hereinbefore referred to out of the first mentioned Seven (7) acres of land, which is to be deeded to Mrs. Ward, shall be credited to said mortgage, and that under the terms of said mortgage, the sum of $750.00 shall be sufficient to release any lot from the effects of the mortgage.’ “The transaction was completed on June 7, 1949. Mrs. Ward put up $16,250.00 as the required down payment. Out of this payment Weaver got $1,900.00 and $277.75, his lawyer $1,000.00, and a judgment against Weaver and Court costs in two cases were paid. “On this day, Carr conveyed the 41% acres to Weaver and wife, Carr took a mortgage on 27 acres and one acre for the balance of the purchase price, Weaver and wife conveyed 7 acres to Ward, and executed a deed of trust (not a mortgage as called for in the agreement) on the remaining 6% acres to secure a promissory note in the amount of $16,250.00 payable to the order of Mrs. Ward on or before two years after date, with interest at 5% per annum, payable semi-annually. (There is no claim that the Weavers did not know and fully understand that they were giving a deed of trust instead of ²⁰⁸ a mortgage.

Their lawyer drew it.) Weaver never had the seven acres subdivided, although he sent her a telegram to Paris, Tn view of your decision to hold necessary you send as per agreement half of survey bulldozing now due 3500 civil engineer calls immediate settlement.’ Mrs. Ward was not foolish enough to send the $3500 but wrote to him about the matter. On November 10, 1949, he borrowed $900.00 from Mrs. Ward by representing that his wife was sick from a cancer. “He never paid the taxes on any of the land, never subdivided, never bought the seven acres back, never paid Mrs. Ward anything on the note —in fact it appears that after the date of settlement on June 7, 1949, when he and his creditors received over $1900.00, that he lost interest in the property.