Morrall v. Waterson

The opinion of the court was delivered by Brewer, J.:

The petition disclosed a regular warranty deed, conveying the real estate subject to certain judgments, in consideration of fifty dollars, the receipt whereof was acknowledged. The petition further disclosed that a valuable consideration was given by defendant,, though not the consideration of fifty dollars named in the deed. That the promissory note had not been paid fails to render it no consideration. A promise to pay is,, in contemplation of law, a thing of value, and good con— *204 sideration for contract or conveyance, even though the promissor be insolvent and never performs the promise. 'There is no fraud, mistake, or accident, alleged in the •execution of the deed. On the contrary, it plainly appears that the parties to this conveyanbe knew its contents, and intended that it should be executed in the form it was.

The allegation of the petition is, “ that at the time of “making said deed, the plaintiff was'going temporarily “ out of the State of Kansas, on business, and wishing to “ leave his business in the hands of an agent, who could if “ necessary settle up all the business of plaintiff, in his absence, “ he solicited said Waterson to become and act as his ■“ agent, to which Waterson consented, and in order to •“ enable Waterson to sell said real estate and deed the “ same, when so directed by plaintiff, plaintiff executed and “ delivered said deed to said defendant Waterson, thereby “intending and constituting said Waterson agent and “ trustee of plaintiff, * * * and to reconvey said lands on de- ■“ mand to plaintiff,The offer of the plaintiff was not to show any fraud, accident, or mistake in the execution of the deed, but that at the time of the execution, there was a parol agreement that this absolute conveyance should only operate as a trust deed. We are not shown by the record what testimony was offered, but only what was ■proposed to be proved.

This limits the extent of our inquiry, which, from the ■offer and the petition is simply this : As between grantor and grantee, can the grantor, in the absence of fraud, accident, or mistake in the execution of an absolute deed, show that there was a parol agreement that such con-veyance should only operate as a trust deed? Beyond the question thus presented, we care not to inquire. But for the volume of authorities which hold that in equity *205 an absolute deed may between tbe parties be shown by parol to have been intended simply as a mortgage, there would be little difficulty in answering this question. The plaintiff seeks to show the creation by parol of an express trust concerning lands. Section 1 of the act “ concerning trusts and powers,” in force at the time of this conveyance, and ever since, reads: “ No trust concern- “ ing lands, except such as may arise by implication of “law, shall be created, unless in writing, signed by “ the party creating the same, or by his attorney thereto- “ lawfully authorized in writing.” Could language more plainly forbid the creation by parol of an express trust concerning lands ? Yet that is what this plaintiff sought to do, His offer was to show a parol agreement that his grantee should hold these lands in trust for him.

Sections 6, 7, and 8, of the same act, cited by counsel - for plaintiff, are inapplicable. Section 6, upon which the other two sections are based, and which therefore shows what cases are referred to in the three, reads: “ When “ a conveyance for a valuable consideration is made to “ one person, and the consideration therefor paid by an- “ other, no use or trust shall result in favor of the latter; “ but the title shall vest in the former, subject to the pro- “ visions of the next two sections.”

This section does not apply to cases like the present,, where the whole transaction, including conveyance, consideration, agreement, and everything else, is between the grantor and grantee alone, but to those cases in which the grantee takes from the grantor a conveyance whose consideration is paid by a third party. In Rasdall's Adm’rs v. Rasdall, 9 Wis., 384 , which is a very clear and strong case, the court says: “We do not feel called upon to cite authorities, to show that in the absence of fraud, accident, of mistake, parol evidence cannot be re *206 ■ceived to prove that a deed absolute on its face, was given in trust for the benefit of the grantor, and we have not been able to find anything in this case to make it an exception. "We cannot see why, if this evidence is to be .received to establish this trust, every other deed in the State may not be shown by parol to have been given >upon trust, and the statute of frauds be entirely annulled.”

In Beach v. Packard, 10 Ver., 100, this language is -used : “ Parol evidence cannot be admitted to vary, contradict, add to, or control a deed or written contract. The dqed of bargain and sale between these parties had for its object the conveyance of certain land; and the extent of the land so conveyed, the parties thereto, the estate conveyed thereby, and the covenants attending it could not be affected by parol proof; and even that part -which relates to the consideration or the payment thereof, could not be contradicted or varied by parol, so as in any way to affect the purpose of the deed, that is, its operation as a conveyance.”

Hill on Trustees, (page 112,) says: “"When the conveyance is expressed in the deed to be for a valuable consideration, parol evidence cannot be received for the purpose of showing that the purchaser was intended to be merely a trustee for the vendor.”

In 2 Leading Cases in Equity, p. 705, after quoting from thp decision in 2 Sumner, 228, the editor says : “ This < language approaches, if it does not reach, the full extent of .the proposition that parol evidence is admissible, not only for the purpose of proving fraud or mistake, and thus varying or avoiding the effect of a deed or writing, but for that of adding a stipulation to the instrument in the first instance and then founding an inferential charge ■of fraud or breach of trust on the failure to fulfill it. If this can be done, the salutary restraints imposed by the *207 rule of evidence laid down in Lord Irnham v. Child, and by the Statute of Frauds, are obviously at an end.”

In Johnston v. LaMotte, 6 Rich. Eq., 347 , the court hold this language: “ The fraud insisted on, consists merely in the nonfullfillment of the alleged agreement, and depends of course entirely on the question whether there was in fact an agreement to be performed, and that preliminary fact the statute will not allow to be established by parol.” See also sustaining these views: 5 Duteher, 36; 16 Cal., 350 ; 28 Cal., 632 .

Our conclusion then is, that in the absence of fraud, mistake, or accident, the grantor in an absolute conveyance, reciting a valuable consideration, and acknowledging its receipt, and where it is admitted a valuable consideration was actually received, cannot show a parol agreement that the grantee was to hold the lands conveyed in trust for his benefit. The judgment of the district court must be affirmed.

All the Justices concurring.