Summary
Appeal from Wayne Circuit in Chancery.
Julius A. Austin, in Ms life time filed Ms bill in Chancery, against Heman M. Perce, John B. Gibb, Administrator of Abby S. Perce, late wife of said Heman, Peter Fralick and Mark Norris, to foreclose a mortgage, given by defendant Perce, June 12, 1847, to one Albert Stephens, to secure the payment of notes to the amount of $550, and which had ■been assigned to Austin. The bill, besides the ordinary •allegations in a foreclosure bill, contains the followmg:
“Tour orator further'shows that on or about the ninth day of January, in the year one thousand eight hundred and fifty-five, the said Heman M. Perce and his wife Abby S. Perce, delivered to your orator two notes made by Mark Norris, one of which was dated September 2, 1854, for one hundred and ten dollars and interest at the rate of ten per cent., payable June 2, 1855, to the said Abby S. Peree or order, by the name of Abby S. Gibb, her maiden name before her intermarriage with the said Heman M.; also the other of said notes, being for two ‘hundred and twenty-four dollars and forty-two cents, with interest at the rate of ten per cent, per annum, payable, to said Abby S. Gibb or order, one year after the sixth day of October, 1854, and which said notes were endorsed by the said Abby S. Perce, and which notes your orator-was to hold as collateral security, and apply as payments) if paid to your orator, on said notes and mortgage of said Perce, or to return if said notes and mortgage were otherwise paid to your orator, and for which notes your orator gave a receipt of the substance above set forth; that your orator still holds said notes, and they remain, wholly unpaid.”
The bill prays decree for sale of the mortgaged premises, and that if there shall be a deficiency in the payment of the mortgage, then that he have decree over against Norris,, for the payment of the balance upon said notes. Fralich; was made a party as subsequent incumbrancer.
Austin died after the filing of the bill, and Penniman having been appointed his administrator, the suit was. revived in his name.
To this bill, defendant Perce answered, admitting the mortgage, and giving the following statement of the facts, attending the delivery of the Norris notes to Austin:
“And this defendant, further answering, -says that on or about the ninth day of January, 1855, this defendant,, together with Abby S. Perce, his then wife, since deceased,, called on the complainant in relation to said notes and mortgage, when upon a statement of the amount due thereon, the said Abby S. Perce, then having and holding the two notes as stated in said bill, of the date and for the amount in said bill set forth, she then and there endorsed said notes, and delivered the same to this defendant for the purpose of having the same used by this defendant in the payment and satisfaction of the said notes and mortgage, whereupon this defendant delivered the said last mentioned notes, so as aforesaid endorsed over, to the said Austin, to be by him collected and applied in the payment and satisfaction of the said notes and mortgage, and then and there took from the said ''complainant his receipt for the said notes,” “now in possession of this defendant,” as follows':
“Received, Detroit, January 9, 1855, of Hernán M. Perce and Abby S. Perce, one. note signed Mark Norris, of date September 2, 1854, for one hundred and ten dollars, on interest at 10 per cent., due June 2, 1855; also one other note signed Mark Norris, date October 1, 1854, for two hundred and twenty - four dollars and forty-two cents, payable one year after date, interest at ten per cent., which I am to hold as collateral security, and apply as' payments (if paid to me), on H. M. Perce’s mortgage and notes, or return if Perce’s mortgage are otherwise paid to me.
X A. Austin.”
“And this defendant, further answering, says that on delivering said notes to said complainant, he thereupon received the same, and then and there, as this defendant insists, by law undertook to use due diligence in the collection of the said notes, for the purpose of applying the avails thereof in the satisfaction of the said notes and mortgage, so far as the same should be necessary, and to return the balance thereof to this defendant.”
And he insists that said Norris notes should be applied towards the satisfaction of said mortgage, and that the mortgaged premises should not be sold unless necessary after first applying the Norris notes.
Defendant Gibb answered, claiming that the mortgage in suit was the indebtedness of Hernán M, Perce alone, that the Norris notes were never in the possession, custody or control of said Hernán M. Perce, but were and are the separate estate of Perce’s wife, and that Austin had no right thereto except to hold them as collateral, and apply them if paid.
The bill was taken as confessed by Norris and Fralick. . Gibb thereupon filed a cross bill against Hernán M. Perce and Austin — which, after the death of the latter, was revived against his administrator, Penniman — setting forth: that Abby S. Perce, then Abby S. Gibb, on October 6, 1854, was the owner of said Norris notes; that she intermarried with Hernán M. Perce, December 31, 1854:
“That after the marriage herein before mentioned, of the said Abby S. with the said Hernán M. Perce, and on or about the ninth day of January, 1855, and while the said Abby S. was still the owner and possessor of the said two notes made by said Mark Norris, she, the said Abby S., was induced by the solicitations of the said Hernán M. Perce, to indorse and transfer, and did indorse and transfer the said two promissory notes made by said Norris to the said Julius A. Austin, and at the same time delivered said notes to said Austin with her own hands, to be held by said Austin as collateral security for the payment of the said mortgage and notes accompanying the same, or to be returned to her, the said Abby S., if the said mortgage and notes accompanying the same should be otherwise paid; that the said two notes were indorsed and transferred by said Abby S. to said Austin without any consideration whatever moving to the said Abby S., and that the said Hernán M. Perce has not at any time had possession of, or any right to, or interest in, the said two notes made by said Norris, or either or any part thereof, but that said notes made by said Norris remained the separate property of said Abby S. until the time of her decease hereinafter mentioned, subject only to the rights of said Julius A. Austin as herein before mentionedthat Abby S. Perce died August 31, 1855, and complainant was appointed her administrator: and claiming and insisting that, as such administrator, he is entitled to said notes, subject only to Austin’s rights, and that the mortgaged premises should be first sold and the proceeds applied to the mortgage debt, and the Norris notes delivered over to comjfiainant, as such administrator, or, if it should be necessary to apply any part of the proceeds of said notes to the payment of the mortgage, after the sale of the mortgaged premises, then that the surplus remaining be paid over to complainant.
This bill was taken as confessed by Penniman.
Perce answered, admitting the ownership of the Norris notes by Abby S. Gibb, previous to her intermarriage with him, and setting forth: “that he admits that on or about the 9th day of January, a. d. 1855, the said Abby S. then being the wife of this defendant, under the name of Abby S. Perce, did endorse in her own proper name the said two promissory notes referred to in said bill and made by Mark Norris, and delivered the same, in the presence of this defendant, to the said defendant, Julius A. Austin. But the defendant denies, as in said bill most falsely stated and deposed, that the endorsement and delivery of said notes to the said defendant Austin, was done by the said Abby S. Perce oí1 the solicitation of this defendant, or that she was induced so to do by the solicitation of this defendant to endorse and transfer said notes, or that she did so do under any such influence, but on the contrary thereof, this defendant avers and charges that the said Abby S. Perce endorsed and delivered said notes to defendant Austin for the purpose of paying said mortgage, of her own free will and accord, and without any of the solicitation of this defendant as is in the said cross bill most falsely supposed; and this defendant expressly denies, as in said cross bill supposed, that said notes were, by the said Abby S. Perce, endorsed and transferred to the said defendant Austin as collateral security for the notes and mortgage in said bill stated, but avers and charges that the same was done for the purpose of having the same by the said Austin enforced and collected, and applied to the payment of the said notes and mortgage of this defendant and his former wife, as in said bill stated.
“ That so far from this defendant exerting or attempting to exert any influence, by solicitation or otherwise, to induce Ms said wife, Abby S. Gibb, to indorse and deliver-said two notes, as in and by said bill most falsely supposed and stated, to the said defendant Austin, for the purpose-of paying and satisfying said notes and mortgage so given by this defendant and his former wife, this defendant on the contrary thereof avers and charges that from at or about the time of Ms said marriage with the said Abby S. Gibb, and her becoming Ms wife as aforesaid, she, of her own accord, stated to this defendant that she held the said Norris notes, and that she wished to give them to this defendant for the purpose of paying said notes and mortgage, and as a reason for so doing she among other things freely and frequently stated that she had no relations, by blood or otherwise, that she ever wished should have any of her property, from the manner in which they had treated her, and that she wisheded the said Norris notes applied to the payment of the said noted and mortgage, which was on the premises then and up to the time of his said wife’s death occupied by this defendant and his said wife as a home; that in pursuance of an often expressed determination of the defendant’s wife, the said Abby S., she, the said Abby S., came into Detroit, among other things for the express purpose of having said Norris notes applied to the payment of the said notes and mortgage then in the hands of the said defendant Julius A. Austin, on the day of the date of the said endorsement and delivery of said notes as set forth in said bill: and this, defendant expressly denies that the said Abby S. did, or intended to retain any right, title or interest, uin or to said notes, or either of them, or the moneys therein or thereby secured, but fully intended absolutely to dispose of the same as she had often fully and clearly expressed, before endorsing and delivering the same, as is in said bill set forth, but the object was that the said defendant Austin should collect the same as they became due, and apply the avails thereof to the payment of the said notes and mortgage,, applied to the payment as this defendant insists that in justice and good faith he ought long since to have done, and not to have sought to foreclose said mortgage, which this defendant insists, and charges is in bad faith, and in violation of his duty in the premises.
“And the defendant further answering says: he denies; as in said bill supposed, that the said Norris notes were only endorsed and delivered to the said Austin as collateral security, but on the contrary thereof he avers the same were so endorsed and delivered for the purpose of being collected and applied to the payment of the said notes and mortgage; and ^lenies, as in said bill supposed and stated, that he, this defendant, never had the possession of the said Norris notes or any right to or interest in the same, but on the contrary thereof he avers and charges that he became the true and lawful owner of the same, and fully entitled to the possession thereof, as well as the full and legal ownership, until the same were by his assent assigned and transferred to the said defendant Austin for the purpose aforesaid, and this not only in virtue of his. marital rights, but by virtue of said assignment and the subsequent death of his wife, Abby S. Perce.
“And this defendant further answering says: he admits the said Abby S. Perce departed this life intestate, on or about the time and at the place in said bill stated, and he further admits that administration upon her estate was in fact granted as is in said bill stated, but he avers and insists that the same was wrongfully granted to the said complainant, and without lawful warrant or authority, and legally belonged to him as the surviving husband of the said Abby S., whose personal, property also -belonged to him as such survivor.”
Replications were 'filed in both cases, and testimony taken as follows:
“ James Sutli-f, testified: “I knew Abby S. Gibb, who subsequently became wife of Hernán M. Perce: I had a,. conversation with her after her marriage with Perce, in relation to two notes. I can’t fix the time. It was at defendant Perce’s house. I asked her how she got along. She said,' better than I ever expected. I said, have you laid out your property as you expected? She said, yes, to my satisfaction. She told me that she had cleared the mortgage, and that she had got the farm clear, and that now she was satisfied. She said she had signed over the notes she held against Norris. I think she had signed away some notes to a man in Plymouth to pay a mortgage. It appears to me that the man’s name was Austin, that held a mortgage against his property. It appears to me the name was Austin that held' the mortgage. She had signed the notes to him. She stated like this: she said — my father is living, and I owe him nothing. I owe my brother nothing, and I would rather the property would go into any one’s else hands but theirs. She told me she calculated that the defendant Perce should have the property — that she had signed it to him, and it was his. She said she had done so of her own free will — just as she had wanted to do. I think she said she had signed the notes off herself. She stated she had paid the notes on a mortgage.”
Gross - examined: “I had heard that Mrs. Perce was rather dissatisfied, and that is why I asked her if she had made the assignment of her own free will. I thought I would know for myself, and I asked her. Said I, have you done all these things of your own free will, and are you satisfied with it? and she said, Yes. She said, now I have paid a mortgage on defendant’s property, and if he should die I think I should have some security if I should outlive him. I .told her that would be right. I never heard that he had promised to give security.”
Re-examined. “Mrs. Perce told me that when defendant came to court her he told 'her he had a farm, but there was a mortgage on it, and she told him that she had enough to pay it.”
William JB. SelleoTc, testified: “I had a conversation with Mrs. Perce in the year 1855; I think between January and 4th July. She was at my house occasionally. She said she had some property. I asked her if it was in money, and she said notes, and she had turned them out to Julius A. Austin on a mortgage against defendant’s farm. She felt anxious to have it fixed so that there would be nothing against the farm. She said by paying up the mortgage, defendant Perce would be able to build a house. She said it was money of her own earning, and she had no one to thank for it. I think she said that she and defendant had been down, and she had turned out the notes on the mortgage.
Calvin JB. Crosby, testified: “I had some conversation with Mrs. Perce about notes. It was in May or June, 1855. She said she had some notes, and she intended them to assist to pay some debts of defendant Perce. She did not say whether she had or intended to do so. I asked her to buy some goods. She said she could not buy any goods until their debts were paid — they wanted to build a house. This conversation was at Fraliek & Crosby’s store, in Plymouth. Defendant Perce and she were there together; defendant heard the conversation. Something said about the debts of the defendant two or three times in my presence, of the same tenor.”
Mrs. Selleck testified: “I had a conversation with Mrs. Perce in'1855, in January; near the last of January. I frequently met her; was at her house. I saw her as often as every two or three months. She stated to me that defendant Perce had informed her before her marriage he had a debt on his place. She said that she had paid over something, but she did not say whether it was money or notes. She said it was a mortgage on the place, which Mr. Austin held in-Detroit. She did not state the amount. She stated she had paid over. She had been to Mr. Austin with defendant. She did not state what it was which was paid, notes or money — I supposed it was money. She said she had volunteered to pay, as she said she thought it would be better to have the place paid for before they built. She spoke as if she had volunteered to pay it. She stated several times that she knew defendant’s circumstances, and she wished to help him. She never stated to me that she expected any thing back.”
Halmer SellecJc testified: “I had a conversation with Mrs. Perce, I think in January, 1855. She said that as soon as she felt herself at home, she told defendant Perce that she had means by which she could release the mortgage or mortgages. He said he did not expect any such thing. She told him she was willing to pay it. He then remarked that she had better keep the money for hex-own use. She said that she told him it was her choice, and what was hers was his, and that they then took a team and came to Detroit, and saw Mr. Austin, and paid over. Do not think she named the amount. She said something from which I drew the inference, that what ■she paid was notes or orders on a man named Norris, in Tpsilanti. She said they paid over the property to Austin, and released the mortgage, but left $56 unpaid. She said 'she offered to do it, and that defendant Perce told her that she had better not, and she told him it was her home there, and she would rather do it; she did not like the idea of building without paying it. She spoke to me upon the subject, and to the same effect, in February. She said distinctly that it was her own free act. She said nothing about any thing to come back, or in relation to any security. She stated (I am confident) that it was % mortgage held by Mr. Austin, on Perce’s farm, and that was what she proposed discharging.”
Peter FralicJc testified: “ Mrs. Heman Perce said to me, in the early part of January, 1855, and also in the latter part of the same month, that she was desirous of saving-all the money she could, and that neither she nor Mr. Perce wished to purchase any articles, except those of necessity, until they had paid the mortgage which was on their place. She also said that she had money or notes enough to pay the mortgage except twenty or forty dollars, and that it was their intention to pay it before contracting any more debts. She expressed an entire willingness, so far as I could judge, to apply the money or note which she held in payment of the mortgage. The mortgage referred to was understood by me to be the Austin mortgage. These remarks were made by her in reply to my request of her to purchase more goods of me.”
Horace Perce, testified: “ I was present at a conversation between Hernán M. Perce and Abby S. Perce, his wife. It was two years ago this winter, at the house of Heman Perce, in the town of Nankin, Wayne county. I heard Mrs. Perce say on that occasion that she did not want her father to have her property. I have heard her say so a number of times. Mr. Perce was present, also the complainant’s son, Dewitt, and myself. She made the remark to all present. We had all been talking about her property. I heard Mrs. Perce say she had been down to Detroit, and turned the notes out to Mr. Austin on the debt on the farm. The notes were against Mark Norris. This was at another conversation, the same winter. It was before the other conversation. It was me that she told about the notes. She had been to Detroit, and when she came back I asked her what her business was at Detroit, and she then said she had gone to Detroit to turn out the Norris notes to Mr. Austin in payment of the debts on the farm, and that Mr. Austin had received them.”
The testimony, so far as it went to show the intention of Mrs. Perce, in transferring the notes to Austin, was objected to by the counsel for Gibb, on the ground that the receipt was the best evidence.
The causes being brought to a hearing upon the foregoing pleadings and evidence, the Circuit Court made a decree dismissing the cross-bill with costs, and ordering that the Norris notes be first paid to Penniman towards satisfaction of the Perce mortgage, and that Perce then pay the balance of the mortgage, and in default thereof, that the mortgaged premises be sold to satisfy such balance. Gibb appealed from this decree.
Syllabus and headnotes are prepared by the reporter or publisher, not the court, and are not part of the opinion.
