Meade County Bank v. Fredricks

WHITING, J.

Action to foreclose -mortgage on real estate. Mortgage signed by husband alone. Defense that it was invalid, because land was the homestead of mortgagor and wife and she did not join in the execution of the mortgage; also, that mortgage •was not to be effective until executed by wife. Plaintiff evidently realized the invalidity of the mortgage pleaded, because, after introducing into evidence such mortgage and the note described therein, it proceeded, as against both defendants, to introduce evidence to establish an equitable oral mortgage. The trial court •entered findings and conclusions and rendered judgment for plaintiff, and defendants have appealed.

The trial court found the following facts which alone give -any suport to its conclusions and judgment:

That defendants “represented to the said plaintiff, for the purpose of inducing the said plaintiff to advance money to them, the said defendants, for their use and benefit that if the said ^plaintiff would advance such money to the defendants they and *512 'each of them as husband and wife would execute a mortgage, covering the land hereinbefore described, to the plaintiff to secure the payment of such sums as would be so advanced to the said defendants before the making of final proof on said land and that the defendants and each of them did promise and agree in consideration of the plaintiff advancing various sums of money to the said' defendants at various times as above stated, to execute and deliver said mortgage to the said plaintiff.

“That acting upon said representations and promises of said defendants, the plaintiff, between the time of the said entry of said land by defendants and the making of said proof thereon, and at the time of making of said final proof, advanced and loaned to the said defendants the sum of eight hundred dollars.”

[1,2] The above facts might support a judgment under the decisions of this court in Baker v. Baker, 2 S. D. 261, 49 N. W. 1064 , 39 Am. St. Rep. 776 , and Heran v. Elmore, 37 S. D. 223, 157 N. W. 820 ; but the findings are unsupported by the evidence. Under respondent’s own evidence, the greater part of the amount to secure which respondent seeks to have the court decree an' equitable mortgage, was advanced; prior to any promise to give a mortgage and therefore not in reliance upon any such promise. Furthermore such evidence shows that the promise, if any, given by appellants, related to “funds to be used and also funds to prove up on some land.” It was incumbent to show just what >was advanced in reliance upon such alleged promise. There is no evidence that more than $270 in all was advanced in reliance upon such promise, while the trial court found that $800 was so advanced. It appears affirmatively, and without dispute, that over half of the $800 was indebtedness existing prior to any alleged promise. There is no evidence to show when a part of the $800 was advanced.

[3] Should the judgment be reversed or upheld- as security for the $270 and interest? Respondent introduced in- evidence a letter which discloses that respondent knew that the written mortgage was executed by the husband and left with respondent to be .executed -by the wife. The evidence is undisputed that respondent knew the land was the home of appellants at the time the written mortgage was signed by the husband. The following *513 facts are therefore perfectly clear in this case: Respondent undertook to foreclose a mortgage which it knew to be invalid, even if the property described were not a homestead, -because it was not to go into effect until executed by another grantor. It undertook to foreclose a mortgage which it knew covered homestead land and was invalid because not executed by both husband and wife. Failing in this attempt, it asked a court of justice to give it an equitable mortgage to secure $800 when, from the evidence offered by itself — the testimony of the person to whom, as an officer of respondent, it is claimed the promises were made — -it appears that the equitable right, if in fact there was ever any promise on the part of the wife upon which such right could rest, was merely, a right to an equitable mortgage securing about one-third the amount sought. We are of the opinion that respondent has not come into court with clean hands.

The judgment appealed from is reversed.