author: FOX, P. J.

text:
    HAL CORDER, Appellant, v. JAMES O’NEILL.
    Division Two,
    December 10, 1907.
    1. COMMISSIONS: Agent to Sell Real Estate: Money From Both Sides. An agent to sell real estate who accepts a commission from the purchaser cannot recover from the seller the commission which the seller agreed to pay him. An agreement between the agent of the purchaser and the agent of the seller to “pool” and divide their commissions is contrary to public policy and void, and if the agent of the seller enters into such an agreement with the agent of the purchaser, prior to the sale, and thereafter the sale is consummated, without knowledge by the seller of the existence of the agreement, the seller’s agent cannot recover from the seller the commission which the seller agreed to pay him. And the fact that the bargain was effected by the principals themselves, in the agent’s presence and with his assistance, does not affect the rule.

      2. -: -: -: Pooling: Knowledge. An agreement between tbe agent of the seller and tbe agent of tbe purchaser by which each was to share in the commissions to be paid by both purchaser and seller, made without the knowledge of the seller, is, on his agent’s part, an indirect method of acting as agent for both seller and purchaser, and disqualifies him to render that faithful and disinterested service to his principal which the law demands; and such double agency, without the principal’s knowledge and consent, will defeat any recovery of commissions by the agent, whether or not his double dealing resulted in injury to his principal, and whether or not he acted from bad motives, and whether or not he in any wise misrepresented the value and earnings of the property.
    3. ——: -: -: Middleman. And where the agent in his petition charges that he as agent for the seller furnished a buyer at the price agreed upon, and sold the property to the purchaser, and the evidence goes to show that he was present with the purchaser and seller when the sale was made and helped to arrange the terms, if he accepted or had agreed to accept commissions from the purchaser, or to share in the commissions of the purchaser’s agent, he was not a mere middleman, and the courts will not indulge in any refined theories to make him a middleman.
    Appeal from Jasper Circuit Court. — Hon. Hugh Dabbs, Judge.
    Affirmed.

      Thomas é Hackney for appellant.
    (1) Under the facts shown in evidence plaintiff did not forfeit his right to commission from the defendant, nor forfeit his right for damages herein on account of his arrangement with House by which he was to receive a share of the amount paid by the purchaser. It appeared from the evidence that defendant had fixed the price for his property, to-wit, $85,000'. By his agent he told the plaintiff that plaintiff must get his compensation from the purchaser and, hence, $5',000 was added to defendant’s price for the property, and plaintiff was directed to name the price to the purchaser as $90,000, which he did. Plaintiff then introduced the purchaser to defendant and after bringing them together took no hand in the negotiations, and they made their own bargain and afterwards drew up and signed a contract in his absence. Under such circumstances plaintiff did not forfeit his claim for the compensation from defendant, even though he received compensation from the purchaser in addition to the $5,000 agreed upon between him and defendant. Rannev v. Donovan, 78 Mich. 318; Montross v. Eddy, 94 Mich. 105; Friar v. Smith, 120 Mich. 413; Rupp v. Sampson, 16 Gray 398; Stewart v. Mather, 32 Wis. 344 Barry v. Schmidt, 57 Wis. 174; Orton v. Schofield, 61 Wis. 384; Alvord v. Crook, 174 Mass. 120; Mullen v. Kwelzleb, 7 Bush 253; Knauss v. Brewing Oo., 142 N. Y. 70; 23 Am. and Eng. Ency. Law (2 Ed.), 907; Cox v. Hann, 127 Ind. 325. (2) It is clear from the testimony that defendant in engaging the services of plaintiff to make the sale of his property did not invest plaintiff as broker with the least discretion in fixing defendant’s price and plaintiff’s judgment as to the value of the property was in no wise considered or bargained for by defendant, nor was it contemplated that there should in any sense be an exercise of any discretion or judgment on the part of plaintiff in any of the negotiations towards fixing the price. The only thing defendant bargained for with plaintiff was to bring him a person who was willing to buy the property and pay defendant $85,000, plus plaintiff’s commission of $5,000’ therefor. This plaintiff did and he was therefore entitled to his commission. There was no possibility for the duty of plaintiff and his interest to clash. In such cases the broker is treated simply as a middleman and he; earns his commission by bringing the parties together, and. there is no rule or public policy which would prevent his recovery of commissions if he has a contract with each party. Authorities supra.

      E. A. Spencer for respondent.
    The agreement between the agents for defendant and the purchaser, made without the consent of the principals, to pool and divide their commissions, prevents a recovery by plaintiff. Norman v. Roseman, 59 Mo. App. 682; Levy v. Spencer, 18 Colo. 532, 33 Pac. 415, 36 Am. St. Rep. 303; Shepard v. Hill (Wash.), 34 Pac. 159. This would be true unless both principals consented thereto. Chapman v. Currie, 51 Mo. App. 40; De Steiger v. Hollington, 17 Mo. App. 388; McClure v. Ullman, 102 Mo. App. 697; Rosenthal v. Drake, 89 Mo. App. 358; Connor v. Black, 119 Mo. 134; Crumley v. Webb, 44 Mo. 451.
   FOX, P. J.

— This cause reaches this court by appeal on the part of the plaintiff from a judgment of the Jasper County Circuit Court in favor of the defendant. This action results from a transaction between the plaintiff and the defendant concerning the sale of a certain mining lease placed in the hands of plaintiff for sale by the defendant and an agreement and contract entered into by which the sum of $5,000 was to be paid plaintiff as commission for the consummation of such sale. This is the second appeal of this cause to this court. The first appeal was upon the part of the defendant and the cause was reversed and remanded. This appeal, as before stated, is on the part of the plaintiff.

The nature and character of this proceeding is fully set forth in the case of Corder v. O’Neill, 176 Mo. 401; it is therefore not essential to reproduce in detail the entire pleadings, but it will be sufficient to a full understanding of the issues presented in the .last trial of this cause to briefly refer to some of the allegations in the petition and answer. The petition alleged that the plaintiff “was at all times hereinafter mentioned engaged in the business of selling real estate, mines. mining property and leases on mining property in Jasper county, Missouri, as agent for such persons or concerns as might employ him therefor, and on March 22, 1899, the defendant, James O’Neill, was the owner of a certain lease known and described as the ‘Get There Lease’ in or near the city of Carterville in said county and State and on said day he was desirous of selling the same. That at the same time the plaintiff had as customer for a piece of mining property one C. C. Playter, who desired for himself and others and especially for one R. Tibbets, of Boston, Massachusetts, to purchase a mining lease in Jasper county, Missouri, and on said date the defendant entered into a contract with the plaintiff, whereby he agreed that if said Playter or his assigns should take the lease of the defendant, known as the Get There Lease, and should comply with the conditions of a contract made with the said Playter, or his assigns, for said lease and should pay to the defendant the sum of ninety thousand dollars in cash for said lease, on or before the first day of May, 1899, then the defendant will pay the plaintiff the sum of five thousand dollars in full for all commissions and compensation for services rendered by the plaintiff in and about the sale of the said Get There Lease. . . . That during the existence of said contract the said Tibbets, through his said agent, requested of the defendant that he would extend the time for the payment of the balance of the purchase money for said lease until the first day of June, 1899. Said contracts are herewith filed, marked ‘Exhibits A and B. ’

“Plantiff further states that at the time of procuring said property for sale defendant only asked the sum of eighty-five thousand dollars therefor and by agreement with defendant offered and contracted said property for the sum of ninety thousand dollars, it being agreed that the excess over eighty-five thousand dollars, to-wit, five thousand dollars, should be paid by defendant to plaintiff for making said sale.
“That within the time limited plaintiff sold said property for ninety thousand dollars to one Frederick R. Tibbets on March 22, 1890, and five thousand dollars of the purchase price was thereupon paid by said Tibbets to plaintiff, and the balance was to be paid by said Tibbets on or before May 1, 1899. ’ ’

The foregoing averments were followed by allegations asserting that there was a verbal agreement entered into between Tibbets, the purchaser procured by the plaintiff, and the defendant, to extend the contract for thirty days, giving said Tibbets that much more time to purchase said property. Then follows the averment alleging a breach of such oral agreement and the prayer for relief that by reason of the breach of such verbal agreement and promise to extend said original contract by the defendant and by reason of the fraud thereby practiced upon the plaintiff, plaintiff is damaged in the sum of five thousand dollars, for which sum he prays judgment.

After this cause was remanded to the circuit court of Jasper county for a new trial the defendant filed an amended answer on January 4,1904. The first paragraph of said amended answer was a general derfial. The new matter set up in the amended answer was as follows:

“Second. Further answering defendant states that without his knowledge or consent the plaintiff agreed to and did receive money as commission or compensation for services in and about the alleged sale, from the purchaser of the property described in the petition, and thereby forfeited all his claim against defendant and is not entitled to recover herein.
‘ ‘ Third. Further answering defendant states that without the knowledge or consent of defendant the plaintiff entered into an agreement with the representatives of the purchasers of the property described in the petition to ‘pool’ or divide the commissions received and to be received from the defendant and the purchaser of said property in the petition described. That said agreement was made before the consummation of the sale of said property. That in pursuance of said agreement the agent of the said purchaser did receive money from the latter as commission or recompense for services in and about said purchase and did carry out said agreement and pay a portion thereof to defendant. By reason whereof, plaintiff forfeited all his claims against defendant and is not entitled to recover herein. ’ ’

To this amended answer the plaintiff filed a reply, which embraced a general denial of the new matter, and “further replying, plaintiff avers that plaintiff procured and introduced the purchaser to defendant and that plaintiff had no hand in the negotiations between them; that said purchaser and defendant made their own bargain without plaintiff having anything to do with fixing of the price or terms of said sale and without plaintiff’s interference in anywise. Wherefore, plaintiff prays judgment as in his petition prayed. ”

Upon the issues thus presented the trial of this cause proceeded. It is practically conceded that the facts developed at the trial of this cause are substantially the same as in the trial of the cause upon the former appeal, except as to the evidence introduced upon the issue presented by the new matter in the amended answer of defendant; hence we deem it unnecessary to undertake to again repeat the facts developed' which-fully appear in the case of Corder v. O'Neill, supra, and shall confine our reference to the testimony to the issue presented by the new matter in the amended answer of the- defendant. The- testimony as disclosed by the record upon this issue is quite voluminous, but' doubtless the trial court sustained a demurrer to the evideuce upon certain statements testified to by the plaintiff and witness Mr. Geddes, who was also interested in the transaction; therefore, we deem it sufficient to refer briefly to the testimony of the plaintiff and Mr. Geddes upon the issue presented in the answer of the defendant and upon which the court’s action in sustaining the demurrer to the evidence was predicated.

The plaintiff was introduced as a witness and upon' the subject of his employment by the defendant to make this sale, said:

“Q. Who named the price at which this property would be sold — who fixed the price? A. Mr. Bruen.
“Q. What was said in that connection, Mr. Corder, about the price of the property and the commission? A. We asked Mr. Bruen what his price was, and he said the price was $85,000. Then I said, ‘Mr. Bruen, will you allow my commission out of that?’ and he said, ‘You will have to add it to it, ’ and I said to him, ‘If I add my $5,000 to it, will you then hold the price at $90,000 and give me a contract bade for the $5,000?’ And he said, ‘Yes.’ That was the agreement between us.”

As applicable to this same subject of employment and the nature of the employment, witness Mr. Geddes testified as follows:

“ Q. You may state if you went there by arrangement between you and Mr. Corder at the time? A. Yes, sir.
“Q. Now go ahead? A. Col. O’Neill said it was for sale; but was in such shape he couldn’t give an option. ... I told him the parties were cash purchasers and didn’t care for an option if he could sell it, and he said he could. Said his price was $85,000'. . . . I told him I would add my commission to that amount.
“Q. Did you state what it was? A. No, I didn’t at that timé tel] Col. O’Neill. I think I didn’t. I am not sure.
“Q. State further all that was said? A. Well, he said he would want an immediate payment for the property and would give time on the balance.”

The plaintiff again in testifying as to the information that he acquired from the defendant in relation to the property, said:

“Q. Now, what, if any, statistics did you get up in regard to the property and send to any of the parties you were putting this property to? A. I furnished a regular statement of it, together with a prospectus of it written up' and describing the property.
“Q. Well, probably the jury would not understand what a regular statement was? A. Statement of the production and earnings, etc., and royalties, what the royalties amounted to.
“Q. Covering what period of time? A. I don’t remember now, but very probably — I don’t know whether they ran back as far as six months or what time.
‘ ‘ Q. From whom did you obtain the data you used in making up this statement? A. Mr. Bruen.
“Q. Where were you when you obtained them? A. I am trying to think where that was gotten — whether got it from Mr. Bruen — whether Mr. G-eddes got it or I. We were trying to deal together, you know, and I don’t know,whether Geddes went for a fact or I.
“Q. To whom did you send those statements or prospectus? A. I furnished it first to Mr. House, who was getting the statement originally for the Playters.
‘ ‘ Q. And the statement went to the Playters ? A. Yes, sir. ... I presented these facts first to Mr. House.
“Q. Going to Playters — for the Playters ? It was the medium you adopted to get it to the Playters? A. Yes, that is right. ’ ’

Plaintiff also testified a,s to the meeting between the defendant and the purchaser, Mr. Playter, who was with plaintiff and Mr. Geddes, as follows:

‘ ‘ Q. And you were present the time that [the contract of sale] was agreed to between Playter and Breen ? A. Yes, sir.
“Q. And took part in that discussion? A. Yes, sir.
‘ ‘ Q. And you wanted the thing to go through and assisted in whatever you could to get them together? A. Yes, sir.
“Q. Who fixed the terms — who agreed upon the terms ? A. I arranged the terms with Mr. Bruen.
“Q. I mean between Playter and Bruen? A. We were all together, all three of us, discussing the matter together, you know.”

Upon this same subject witness Geddes testified and made answer to the following questions:

“Q. WThat I mean, you gentlemen came in there and talked back and forth? A. Yes.
“Q. And to some extent more or less discussion between you, and the result of all the discussion there was these contracts, the terms of these contracts were agreed upon and afterwards reduced to writing? A. Yes, sir. ■
“Q. That is a fact, isn’t it? A. Yes, sir.”

Upon the subject of dividing the commissions to be paid by the purchaser and the seller, who was the defendant, the plaintiff as the record discloses testified as follows:

“Q. You and Mr. Geddes in all this matter were in together? A. Yes, sir.
“Q. Now, I will ask you if it isn’t a fact that Mr. Geddes and you had a contract at that time by which you were to receive a commission from the purchaser of this property for the making of the sale? A. When we first entered into the agreement Mr. House, who at that time was hunting for a property for Playter, said to me that I will make something out of this and I ■will divide it with you, which he afterwards done.
Q. He gave you a part of the commission he had received from the purchaser? A. Yes, sir.
“Q. And that was the arrangement during all this time, commencing prior to the contract of March 22nd? A. Yes.
“Q. You never told Col. O'’Neill that? A. I did not. . . .
££Q. As a matter of fact, you were interested on both sides in the way of commissions all through this matter? That is a fact? A. Yes, I said that.”

Witness Geddes, upon the subject of the division of commissions, testified as follows:

“Q. You and Mr. Corder were working together? A. Yes, sir.
i£Q. Under an agreement to divide what you made? A. Yes, sir.
£ £ Q. And you did divide what you received from the purchaser? A. Yes, sir. It was divided between four of us. Well, we never received any. It was to be .divided.
££Q. You did get some? F'rom the purchaser, now? Not Col. O’Neill’s side, but the other? A. Yes, ■we received a payment from Mr. Playter.
‘ ‘ Q. And there had been an understanding to that effect that you were to receive that all the time? Col. Corder had an agreement with them for $3,000? A. That is my recollection.
££Q. Out of the commission? A. Yes, as commission.
£ £ Q. And that agreement was in existence during all the time of these transactions? A. I presume so.
‘ ‘ Q. You knew of it before this contract was signed, didn’t you? A. Yes, sir.
“Q. You never advised Col. O’Neill of that fact? A. No, sir. ”

While the record discloses numerous other answers to questions propounded to plaintiff upon his examination which might he construed as being in conflict with the answers to questions as heretofore recited, yet we do not deem it necessary to reproduce all the questions and answers propounded to the plaintiff. We will give such other answers as are disclosed by the record and referred to by learned counsel for the plaintiff such attention as they merit during the course of the opinion.

At the close of the evidence the court sustained a demurrer to the evidence and instructed the jury that under the law and the evidence in the cause their verdict should be for the defendant. To the action of the court in so declaring the law plaintiff properly preserved his exceptions. Upon the giving of such instruction the plaintiff took an involuntary nonsuit with leave to move to set the same aside. Plaintiff then filed his timely motion to set aside the nonsuit and grant the plaintiff a new trial, which was by the court overruled and judgment was rendered in conformity to the verdict which the jury was directed to return, and from this judgment the plaintiff prosecutes this appeal, and the record is now before us for consideration.

OPINION.

The record before us in this cause presents but one legal proposition, that is, under the facts developed upon the trial of the issue presented by the- new matter in the amended answer of the defendant, is the plaintiff entitled to recover? In other words, was the action of the court in sustaining a demurrer to the evidence offered by plaintiff proper or was it erroneous?

We have carefully analyzed the facts developed at the trial, as disclosed by the record, and in our opinion the agreement or arrangement with Mr. House, who was representing the purchaser in this transaction, by which the commissions paid by the purchaser and the commissions to be paid by the defendant were to be divided between the agents representing both the buyer and the seller, clearly falls within that class of contracts which have been repeatedly condemned by the appellate courts of this State and in numerous other jurisdictions upon the ground that such contracts and arrangements between agents and brokers are contrary to public policy and therefore absolutely void. The appellate courts of this State have spoken in no uncertain or doubtful terms concerning transactions similar to the one in the case at bar. In Norman v. Roseman, 59' Mo. App. 682, the facts developed in that case upon which the court predicated its announcement of the rule of law which would govern it were about as follows: The defendant owned some lots on Cleveland avenue, which he valued at $20,000'. A syndicate, of which-Sawyer was a member, owned a business lot on Franklin avenue, which they valued at $50,000. Sawyer, who was also a real estate agent, had the Franklin avenue property for sale or exchange. The plaintiff occupied a desk in Sawyer’s office. Previous to the negotiations for the trade in controversy, he had endeavored to exchange with the. defendant other property which Sawyer had on his list for the Cleveland avenue property. Finally the defendant employed him to trade with Sawyer on the following basis, to-wit: The Franklin avenue property to be put in at $49,500'; the defendant to .convey to Sawyer the Cleveland avenue property at a valuation of $20,000 ; the defendant to assume a mortgage debt of $20,000 on the Franklin avenue lot, and execute a second mortgage to Sawyer for $9,500. The defendant agreed to pay plaintiff $200 if he succeeded in making the trade. Sawyer agreed to make the exchange, and the defendant backed out of the trade. Plaintiff admitted on his cross-examination that, if the trade' had been consummated, he and Sawyer would have “pooled” and divided their respective commissions; that this was their universal way of doing- business in such cases. The plaintiff also admitted that he had not communicated this arrangement between himself and Sawyer to the defendant. Upon this state of facts it was announced as the settled rule that a real estate agent cannot legally charge or receive commissions from both parties to a sale or trade unless they consent to it, and that the “pooling arrangement” embraced in the recitation of facts as heretofore indicated, which was testified to by the plaintiff in that cause, while it may not be construed as strictly speaking a double agency, was tantamount to it and possessed all of its ugly features. Touching such “pooling arrangement” the court said that under it the plaintiff and Sawyer were attempting to do indirectly what the law would not permit them to do directly, that is, charge commissions on both sides and thereby depriving the defendant of the disinterested judgment and effort of the plaintiff in effecting to the best advantage to himself an exchange of his property with Sawyer, to which under the contract of employment he was justly entitled.

In Chapman v. Currie, 51 Mo. App. l. c. 43, it was announced as a general rule that “a man cannot act as the agent or representative of both parties to a trade, and, if he puts himself in so unworthy a position, the law will not recognize any of his pretended rights growing out of it. Such contracts are held to be absolutely void as being contrary to public policy, and it makes no difference that such common agent was guilty of no actual wrong. The courts refuse to countenance such an employment, not for the sake of the principals, but for the sake of the law,” and it was announced by the court that the great weight of authority is with this view. This ease was cited approvingly by this court in Connor v. Black, 119 Mo. l. c. 134.

In Lynch v. Fallon, 11 R. I. 311, it was held that “a broker acting at once for both vendor and vendee assumes a double agency disapproved by the law, and which, if exercised without full knowledge and free consent of both parties, is not to he tolerated.” It was said by the court in that case: “As agent for the vendor, his duty is to sell at the highest price; as agent for the vendee, his duty is to buy for the lowest; and, even if the parties bargain for themselves, they are entitled to the benefit of the skill, knowledge and advice of the agent, and, at the same time, to communicate with him without the slightest fear of betrayal, so that it is hardly possible for him to be true to the one without being false to the other.”

In Everhart v. Searle, 71 Pa. St. 256, it appeared that the agent was acting for the purchaser as well as the seller. It was there held that such an arrangement, unless made with the consent of both parties, was void as against public policy, and it was said by the court that “the danger of temptation from the facility and advantage of doing wrong, which a particular situation affords, does, out of mere necessity, work a disqualification. ”

In Rice v. Wood, 113 Mass. 133, the law as applicable to this subject was very clearly stated. It was there said that “contracts which are opposed to open, upright and fair dealing are opposed to public policy. A contract by which one is placed under a direct inducement to violate the confidence reposed in him by another, is of this character. . . . Nor is it necessary to show that injury to third persons has actually resulted from such a contract, for in many cases when it had occurred this would be impossible to he proved. The contract is avoided on account of its necessarily injurious tendency.”

The reason of the rule of law applicable to the subject now under discussion is nowhere better stated than in DeSteiger v. Hollington, 17 Mo. App. l. c. 388. The reason for such rule was given in this language by the court in that case: “Agency or employment for two parties in antagonistic interests, is not a worthy position to occupy. It is not possible for a man to serve two masters, with opposing interests, honestly, at the same time; the rights of one, or the other, or both, will necessarily suffer. The temptation for wrong is too great for ordinary human nature. So jealous is the law as to the relation between principal and agent, that in passing on questions of this character, arising between them, the mere fact of the discovery of no actual fraud or bad faith, does not relieve the case in the least. ‘ The cases are nearly, if not quite uniform, where the double employment exists and is not known. No recovery can be had against the party kept in ignorance and the result is not made to turn on the presence or absence of designed duplicity and fraud, but in consequence of established policy.’ ”

The doctrine announced by the Courts of Appeals of this State is fully recognized by this court in Connor v. Black, 119 Mo. 126; Grumley v. Webb, 44 Mo. 444; and Atlee v. Fink, 75 Mo. 100. In the case last cited, Judge Henry, in speaking for this court, said: “One employed by another to transact business for him has no right to enter into a contract with a third person, which would place it in his power to wrong his principal in the transaction of the business of the latter, and which would tempt a bad man to act in bad faith towards his employer. The interests of the defendant’s employers, and those of plaintiffs, as buyers and sellers, were antagonistic, and defendant could not serve two masters in a matter in which there was such a conflict in their interests.”

In the case at bar it is clear from the testimony of plaintiff and witness Ueddes that the plaintiff in this cause was to share in the commissions to he paid hy both the purchaser and the seller. In treating of a transaction of a similar character, the Supreme Court of Colorado, in Levy v. Spencer, 18 Colo. 532, thus emphatically condemned it. It was there said: “In our judgment, this agreement comes clearly within that class of contracts that is inhibited by public policy, and consequently void. By its terms each agent was to share in the commissious paid hy both principals. The compensation to be jointly shared was conting'ent upon the consummation of the trade or sale, and this would have a tendency to induce them to disregard, if not to sacrifice, the interests of their principals, if necessary to effect that result. The fact that a sale price was fixed by the principals upon their respective properties does not answer this objection. Each was entitled to the benefit of the unbiased judgment of his agent as to the value to be placed upon the other’s property, and to a reasonable effort on the part of such agent to obtain a reduction of the value to be allowed therefor in the exchange. Their pecuniary interest might have prevented such disinterested action on the part of these agents; and, it appearing from the allegations of the complaint that they ‘did effect the trade or sale of the property as between their respective principals,’ the transaction is as objectionable as those universally condemned, wherein one agent acts for both principals without their knowledge or consent. This objection is not answered by the claim that the evidence as introduced shows a transaction different from that pleaded, that their principals negotiated the trade between themselves, and that in fact plaintiff and defendant acted only as middlemen in bringing Nix and Jones together.”

Learned counsel for appellant earnestly and very ably present the contention that the court erred in sustaining the demurrer to the evidence offered on the part of the defendant and in directing a verdict for the defendant. This insistence by counsel for appellant is predicated upon that line of cases which hold that, if the agent or broker is not employed to negotiate the 'sale or purchase, but simply to bring two parties together and permit them to make their own bargain, in snch cases the agent or broker is a mere middleman and may recover an agreed compensation from either or both, though neither may know that compensation from the other is expected. That there is a class of cases maintaining such rule there is no dispute. They are fully cited in the brief of learned counsel for appellant ; however, we do not feel called upon to express an opinion as to the soundness of the doctrine announced in those cases, for the reason that the facts developed upon the trial of the issue presented in the new matter embraced in the amended answer of defendant in this case, by no means places the plaintiff in a position to invoke the doctrine announced in those cases. An analysis of plaintiff’s petition, which is the foundation of this action, together with his admissions as a witness, and the testimony of his co-worker, Mr. Geddes, clearly demonstrate that the plaintiff was not a mere middleman, but was acting as the agent of the defendant in the sale of this property. We find in the petition an averment that “plaintiff further states th'at at the time of procuring said property for sale defendant only asked the sum of eighty-five thousand dollars therefor and by agreement with defendant offered and contracted said property for the sum of ninety thousand dollars, it being agreed that the excess over eighty-five thousand dollars, to-wit, five thousand dollars, should be paid by defendant to plaintiff for making said sale.” Plaintiff in his petition makes the further allegation “that within the time limited plaintiff sold said property for ninety thousand dollars to one Frederick R. Tibbets on March 22, 1899, and five thousand dollars of the purchase price was thereupon paid by said Tibbets to defendant, and the balance was to be paid by said Tibbets on or before May 1, 1899'.”

In our opinion it is manifest from the disclosures of the record that while the plaintiff may not have committed any wrong or perpetrated any fraud upon either the seller or the buyer of the property involved in this transaction, yet it is apparent that he was acting for two parties occupying antagonistic positions. He was to receive commissions from the defendant, the seller, and also commissions from the purchaser. In other words, he was acting for both parties. The defendant, the owner of the property, it is true, had fixed a definite price for the property. The price being fixed, it was a matter of interest to find a purchaser. Plaintiff, referring to information concerning this property, in his testimony says that he procured statistics in reference to' production, earnings and royalties and what the royalties amounted to from Mr. Bruen, who was managing the property for the defendant. This information, doubtless, and as the plaintiff states, was procured for the purpose of inducing the party they had in hand to purchase. Now, it is clear that he was to receive commissions for making the purchase of this property from the purchaser; therefore, we are unable to see how it can be seriously contended, even upon the question of presenting this information to the purchaser, with the purpose of inducing him to purchase, that the plaintiff occupied a disinterested position and unsurrounded by any incentive to act unfairly with the defendant or the purchaser, from both of whom he was to receive commissions. We do not mean to say that he in any way colored the information he received in respect to the output, earnings and royalties of the property to sell to the purchaser, but we do say that he was deeply interested in the consummation of that sale, and the incentive to nndnly color the information he had received, when presenting it to the purchaser, was present; therefore, it follows that he was acting as well for the purchaser as he was for the seller, and in presenting this property to the purchaser, who was one of his principals, there was at least present the incentive for him not to act in that fair and disinterested manner which his duty would require him, under the circumstances, to do. While it may be said that a misrepresentation as to the value of the property and its output and earnings would not prejudice the interests and rights of the defendant, the seller, yet it must not he overlooked that this plaintiff was acting for both parties, and that if he in any way misrepresented the property to' the purchaser, with a view of inducing him to purchase, he was committing a wrong* against him from whom he was receiving a commission to make such purchase. But aside from this, the plaintiff admitted upon the witness stand that he was present at the time the contract of sale was agreed to between Playter and Bruen, and also that he took part in the discussion at that meeting. When the inquiry was made of the plaintiff as to who fixed the terms or who agreed upon the terms, he answered, “I arranged the terms with Mr. Bruen.” The further inquiry was propounded, “I mean between Playter and Bruen?” and the plaintiff answered that “we were all together, all three of us, discussing the matter together, you know.” It is true that the plaintiff in testifying in relation to this transaction made some answers which seemingly are in conflict with those recited in the statement of this cause. Such questions and answers are embraced and referred to in the brief of counsel for appellant. It is sufficient to say upon that question that even though the answers referred to in the brief of counsel were to be construed as in conflict with the other answers made by the plaintiff, yet we take it that the court, if the plaintiff in responding to questions made answers which were against his interest, would be justified in acting upon the statement contained in those answers, for the reason that they were presumptively true.

We see no reason to further discuss the propositions disclosed by the record. We are of the opinion that the plaintiff does not fall within that class of cases which would designate him as a middleman. The appellate courts of this State, as indicated in the citations heretofore made, evidently do not look upon with favor any doctrine which would encourage agents and brokers in accepting commissions in deals from both parties occupying antagonistic positions in such deal. Agents engaged in the sale of real estate should have but one principal, who is entitled to the best judgment, disinterested advice and assistance and service of such agents respecting the deals which they may have in hand, and we are unwilling, where the proof shows that commissions and arrangements have bee'n entered into by which the agent or broker is to receive commissions from both sides, to indulge in any refined theories to make him a middleman, when seeking to recover the amount of the commission agreed upon between one of such principals.

We have given, expression to our views upon the leading legal propositions disclosed by this record, which results in the conclusion that the action of the trial court in sustaining the demurrer to the evidence was proper, and its judgment should be affirmed. It is so ordered.

All concur.


source: Caselaw Access Project

author: GANTT, J.

license: Public Domain

text:
    L. D. H. RUSSELL et al., Appellants, v. EUGENE WOERNER et al.
    Division Two,
    December 10, 1907.
    APPELLATE JURISDICTION: Recovery of Taxes Paid. A suit, brought against the private owners of real estate, under the provisions of a city charter, to recover taxes, interest and penalties paid out under a void city tax deed, does not involve title to real estate, and does not involve & construction of the revenue laws of this State, so as to give the Supreme Court jurisdiction over the appeal.
    Appeal from Jackson Circuit Court. — Row. Shannon G. Douglass, Judge.
    Transferred to Kansas City Court of Appeals.

      L. A. Lmighlin for appellants.
    Has this court jurisdiction of this case? The question of jurisdiction naturally arises at the outset. It is clear that the title to real estate is not involved, as this court has so decided in a suit to enforce a lien for taxes. State ex rel. v. Elliott, 180 Mo. 658. The only other ground of jurisdiction would he that the case involves “the construction of the revenue laws of this State.” Const, of Mo., art. 6, sec. 12. The question whether the construction of the revenue, article of the Kansas City charter falls within the purview of the words above quoted is one not free from doubt: In the first place, if the words “the State” had been used instead of “this State” it might be argued with more force that the words applied only to laws passed by the State Legislature. But the words “this State” are more inclusive and might be held to apply also to those passed by a constitutional grant of power like the Kansas City charter. Kansas City Exposition Driving Park v. Kansas City, 174 Mo. 425; Hannibal ex rel. v. Bowman, 167 Mo. 535; Phelps v. Brumback, 107 Mo. App. 16.

      Gage, Ladd <& Small for respondents.
    This court evidently has no' jurisdiction. The amount involved is insufficient and the revenue laws of the State are not involved. (See cases cited by appellant.) In the Driving Park case, 174 Mo. 427, relied on by appellants, the court took jurisdiction only because the ‘ ‘ exemption claimed applies as to all state and county taxes as well as to the municipal taxes. ’ ’ The revenue laws of the State ate not involved, directly or indirectly, in this case. There is no pretense that this case belongs here for any other reason.
   GANTT, J.

— This is an appeal from the circuit court of Jackson county. The action was brought January 11,1901, under section 59 of article 5' of the Kansas City charter, to recover taxes, interest and penalties paid out under a void city-tax deed recorded November 13,1897.

There is no controversy about the facts. The petition alleges that at a public sale of land for delinquent taxes held by the treasurer of Kansas City, beginning on the first Monday of November, 1895, the following described real estate in said city was duly sold to C. A. Wills for $5.76, being the amount of taxes, with legal penalties, duly levied and assessed by said city for the year 1895, against said real estate, to-wit: the west thirty-two' and three-quarters feet of north forty feet of lot twenty-three, and west thirty-two and three-quarters feet of lot twenty-four in Woodcock Park, an addition to the City of Kansas, in Jackson county, Missouri. That the certificate of purchase to said Wills was duly issued and recorded, and afterwards, on the first day of November, 1897, was assigned to plaintiffs; that on the 13th of November, 1897, the city treasurer executed the tax deed conveying said real estate to the plaintiffs, and afterwards on the 18th day of September, 1900, plaintiffs brought suit against the defendants, Eugene and Louise Woerner, William W. Johnson and J. D. S. Cook, trustee, to recover possession of said real estate under said tax deed, in which said action plaintiffs were defeated. The petition then proceeds to aver that in addition to the $5.76 paid hy Wills at the delinquent tax sale for the land, other moneys, to the amount of about $80', had been paid out by the plaintiffs and their assignor for their State, county and municipal taxes on said- real estate since the date of the said purchase. It is then alleged that the defendants Woerner are in possession of said real estate and the defendants, Johnson, John D. S. Cook, trustee for Mary D. Gossett, herself and the Knickerbocker Trust Company, have or claim to have some interest in said real estate as owners, incumbrancers or otherwise. The prayer of the petition was that the defendants be adjudged to pay the plaintiffs the amount paid by said Wills at said tax sale, together with ten per cent of such amounts immediately added as a penalty, with twenty-four per cent per annum on the whole of such amount so paid, from the date of its payment, together with the costs of the tax deed and fees for recording the same, and all costs in the case brought to recover the possession of said real- estate, and all the costs of the present action, and that the sum so adjudged be declared a lien on said real estate. The answer of the defendants Woerner was a general denial, and plea of the Statute of Limitation that the suit was not commenced within three years from the time of recording the tax deed, and a special plea that the deed was not recorded within twenty days after the delivery of the deed, and a further answer that these defendants, Woerner, were simply tenants from month to month of the said premises.

The Knickerbocker Trust Company in its answer pleaded a general denial, and then set up in full the proceedings in the ejectment case and the final determination thereof in favor of the defendants therein, and then pleaded, especially, that prior to December 11, 1900, the said company, though not a defendant in said suit, offered to pay plaintiffs the full amount of insurance with penalties and interest and the amount of taxes paid by the plaintiffs, with penalties, interest and costs, as provided by section 59 of article 5 of the charter, which offer the plaintiffs declined, for the reason that it was said real estate they were after and not said money. Said Knickerbocker Trust Company then pleaded the Statute of Limitation of three years against said tax deed, and that the defendants Woerner were mere tenants, who had no interest in the real estate, and that the other defendants had no interest therein, and that plaintiffs had never been in possession of said real estate. In the third paragraph of the answer, the said trust company alleges that the said real estate was sold for the taxes of 1895, but the deed described said taxes as for the year 1894; that the tax deed was void on its face and the real estate was not correctly described in the advertisement, or in said tax deed; that the plaintiffs paid the other taxes set forth in the petition long before they were delinquent andbef ore the said trust company could get an opportunity to pay them, as appear by the dates on which the said several amounts were paid; that said payments were voluntary and cannot be recovered. The answer further pleads that this action was not commenced within three years from the time of recording the tax deed as required by section 60, article 5, of the city charter.

The plaintiffs filed a reply to the answer of the Knickerbocker Trust Company admitting all the facts alleged in the second, third and fourth paragraphs of the answer.

The cause was tried in the circuit court on the 8th of August, 1904, and judgment rendered for the defendants. Motion for new trial was duly filed, heard and overruled and exceptions saved and an appeal allowed to this court.

I. It is clear that the title to real estate is not involved in this action. [State ex rel. v. Elliott, 180 Mo. 658.] The only ground upon which this court could possibly have jurisdiction would be under that section of the Constitution of this State which confers jurisdiction upon this court in appeals involving “the construction of the revenue laws of this State.” [Constitution of Missouri, art. 6, sec. 12.] We are referred to the case of Kansas City Exposition Driving Park v. Kansas City, 174 Mo. 425, in which.this court took jurisdiction of the appeal, hut an examination of the record in that cause and the decision of this court, will show that this court maintained its jurisdiction of‘ the appeal because “the exemption claimed applied to all State and county taxes as well as to the municipal taxes.” It is clear to us that upon the face of the pleadings and the record the revenue laws of this State are in no manner involved, either directly or indirectly. There is no pretense that this case belongs here for any other reason-. The Kansas City Court of Appeals has jurisdiction of this appeal and accordingly it is ordered that the appeal he transferred to that court for its consideration.

Fox, P. J., and Burgess, J., concur.


text:
    JOSEPH P. DUELL et al., Appellants, v. G. E. LESLIE et al.
    Division Two,
    December 10, 1907.

    1. MORTGAGE: Deed Absolute on Face: Redemption. A deed absolute on its face may be shown to be a mortgage, and courts, in the exercise of their equity powers may declare it to be a mortgage and permit the grantor to redeem.
    2. -: -: When? Debtor and Creditor. A conveyance absolute on its face will not be held to be a mortgage unless the relation of debtor and creditor existed between the grantor and grantee. It is essential that the facts show the existence of a 'debt due from the grantor to the grantee, and that it was their intention in the execution of the deed to secure the payment of that debt, or at least the facts should be of such a nature and character as to authorize a legitimate inference that such was the intention of both parties.
    3. -: -: This Case. Plaintiff’s land had been sold under a deed of trust to the mortgagee, and plaintiff and defendants as sureties entered into bond to redeem the land, and plaintiff by warranty deed conveyed it to defendants and at the same time entered into a written agreement by which defendants were within the year to furnish the money necessary to redeem the land and to pay taxes, and any of the parties might sell it at not less than a stated price, and plaintiff was to have possession until the next March and pay rent until then, and if the land was sold the money expended in redeeming it and all other expenses were to be paid and the surplus divided equally between plaintiff and defendants, but “should either party fail to find a purchaser before March 1st, then this contract to be at an end and said land to be considered as deeded absolutely” to defendants and plaintiff “to give possession without further notice on March 1st.” The bond to redeem was not accepted by the purchasing mortgagee, and thereupon one of the defendants paid off the amount due under the deed of trust, and took up said note and deed of trust, and the other defendant by quit-claim deed released to him. The land was not sold, and on March 1st plaintiff yielded possession to said defendant. Held, that the facts do not establish a relation of debtor and creditor between plaintiff and defendant, nor are they of such a nature as to authorize a legitimate inference that the warranty deed was intended by the parties to be a mortgage.

      4. -: -: Conditional Sale. A conveyance of land, burdened and qualified with a condition that either of the parties within a given time may sell the land at not less than a named price, the balance, after lifting an existing encumbrance and paying expenses with the money acquired by the sale, to be divided among the parties, is a sale, and not a mortgage.
    5. -: -: Security. The ultimate fact which converts an absolute deed into an equitable mortgage is that it was given as a security.
    Appeal from Scotland Circuit Court. — -Now. Charles D: Stewart, Judge.
    Affirmed.

      Smoot & Smoot for appellants.

      J. M. Jayne, N. M. Pettingill and Silver & Brown for respondents.
   FOX, P. J.

— This is a proceeding in equity which was begun by the plaintiffs in the Scotland Circuit Court on July 5, 1900, hy which it is sought to have an accounting taken, and ascertain the amount due on a certain mortgage of record, and authorizing the plaintiff to redeem the land embraced in the mortgage, from an encumbrance, by paying the balance due, and for the further relief of reforming a contract made between the parties, and that the warranty deed as executed by the plaintiffs be declared a mortgage, and for other general relief.

We deem it unnecessary to reproduce the pleadings in this cause, but it is sufficient to state that the main issue presented is as to whether or not the warranty deed as executed by the plaintiffs to N. Y. Leslie and F. M. Cowell was in fact executed simply as a security for debt and amounted to nothing more than an equitable mortgage. The cause was submitted to the trial court upon an agreed statement of facts and such statement fully indicates the issues presented in the pleadings. Such agreed statement of facts was as follows:

“For the purpose of a decision of the rights of the parties to the above-entitled cause upon , all issues except the issue of the value of the rents and profits and the issue of the value of the improvements put upon the lands in question, the parties, plaintiffs and defendants, submit said cause upon the following agreed statement of facts:
“The value of-the rents and profits and the improvements may be determined by further stipulation or by evidence taken by the court* each party to- the cause reserving the right to appeal from the decision that may be rendered in the cause.
“It is agreed that on December 22, 1892, plaintiff, Joseph P. Duell, was the owner of the north three-fourths of the east fourth of section sixteen and the northeast fourth of the northwest quarter of section twenty-two, all in township sixty-four, range eleven west, in Scotland county, Missouri, and occupied the same with his family; and on said date borrowed of Eli Seeley, twenty-five hundred dollars, bearing seven per cent compound annual interest from date, to secure which he and his wife on said day executed their deed of trust upon all said lands to one “William B. Seeley, trustee, the said Eli Seeley, being the beneficiary therein, which deed of trust was in the usual form and is recorded in Deed Record 21 at page 245 of the deed records of Scotland county, Missouri; that on the 4th day of March, 1896, no interest had been paid on said deed of trust and the principal with the accrued interest amounted to over thirty-one hundred dollars and that on said 4th day of March all the said land having been duly advertised was sold by said trustee, the forty acres in section twenty-two being bid off by Lackey at eleven hundred dollars and the land in suit being struck off to Eli Seeley, the beneficiary; that on the 6th day of March, 1896, Joseph P. Duell, with N. V. Leslie and F. M. Cowell as his sureties, executed to Eli Seeley their bond to redeem the one hundred and twenty acres, which was tendered to said Seeley and by him refused, whereupon said N. Y. Leslie paid Seeley the amount due on said trust deed remaining after the application of the net proceeds of the said eleven hundred dollars, to-wit, twenty-one hundred and fifty-two dollárs and eighty-five cents, and took up said note and deed of trust on about March 21, 1896; that on said 6th day of March, at the time of the execution of said bond to redeem, said Joseph P. Duell and his wife executed and delivered to N. Y. Leslie and F. N. Cowell their general warranty deed, in the usual form, conveying the lands in question to said Leslie and Cowell for the expressed consideration of twenty-five hundred dollars, which deed is of record in book 56 at page 332 of aforesaid deed records. And at the same time Joseph P. Duell, N. Y. Leslie and F. M. C'owell entered into the written contract set forth in plaintiffs ’ petition, a copy of which marked ‘Exhibit A’ is hereto attached; that at the time said Leslie took up the note and deed of trust aforesaid about the 21st day of March, 1896, said F. M. Cowell conveyed his interest in the lands in question to N. V. Leslie by quit-claim deed of record in book 48 at page 442 and being in the usual form; that neither Joseph P. Duell, nor said Leslie or Cowell found a sale for said land before March 1, 1897, and that the said Joseph P. Duell oc- ' cupied- said farm from March 6, 1896, until the 27th day of April, 1897, and he then with his family moved away and delivered possession of said farm to said N. Y. Leslie; that said N. Y. Leslie paid back taxes on said farm to the amount of eighty-seven dollars and.sixty-two cents and that in 1900 said N. Y. Leslie conveyed the lands in question, together with other lands, to his son, Gr. E. Leslie, hy a general warranty deed in the usual form for the expressed consideration of one dollar, the lands so deeded being a gift, which deed is of record in book 67 at page 305; that said N. Y. Leslie and G. E. Leslie have been in the possession of said lands ever since said Joseph P. Duell moved away from same and have received the rents and profits, paid taxes thereon and made improvements; that said G. E. Leslie is the sole heir to N. y. Leslie and the administrator of the estate of said N. y. Leslie, now deceased, and that final settlement of said estate has been made and .that said N. V. Leslie and G. E. Leslie during all the time mentioned were solvent.
“AIL the instruments referred to in this stipulation shall be considered in evidence.
“10th August, 1905.
“J. P. Duell et al.,
“By his Attorneys, Smoot, Boyd & Smoot.
“N. y. Leslie et al.,
“By Mudd & P'ettingill & J. M. Jayne, their attorneys.”

Attached to said stipulation and referred to therein as “Exhibit A” and read in evidence as follows:

“EXHIBIT A.
“Memphis, Mo., March'6, 1896.
“This agreement made and entered into by and between J. P. Duell, of Scotland county, Missouri, party of the first part and N. y. Leslie and P. M. Cowell, of Memphis, Missouri, Scotland county; parties of the second part.
“Witnesseth: That whereas, J. P. Duell has had his land sold at trustee’s sale, to-wit: The north three-fourths of east fourth, section' sixteen., township, sixty-four north, range eleven west fifth principal meridian, in Scotland county, Missouri, on the 4th day of March, 1896, and whereas he is desirous to save what he can out of the same and whereas he is desirous to give bond to redeem said land as provided by law and whereas said Leslie and Cowell have signed his bond to redeem given said Eli Seeley and whereas said Duell has deeded said land to said Leslie and Cowell, they are to furnish the necessary money to redeem said land within the year 1896, and to pay off taxes and claims against said land to an amount in all not to exceed $2,500, including Seeley’s debt. It is agreed that either said Leslie and Cowell or said Duell may find a chanceffo sell said land at not less than $27.50 per acre within the year 1896, and on said sale said Duell is to give peaceable possession on March 1,1897, to purchaser or purchasers. Out of the proceeds of said sale shall first be paid the amount of money expended in redeeming said premises, all taxes, judgments and liens on said place and all costs incurred by Leslie and C'owell in redeeming or defending said land and eight per cent interest thereon from time paid out by them. Said Duell to be charged rent at $250 per year, which he agrees to pay said Leslie and C'owell. Then on said sale the surplus proceeds of sale after paying off all claims, interest and costs shall be equally divided. One-half to said J. P. Duell and one-half to said Leslie and Cowell. The term surplus to include rent aforesaid. Should either party fail to find a sale for said lands before March 1, 1897, then this contract to be at an end and said land to be considered as deeded absolutely to said' Leslie and Cowell and said Duell to give possession without further notice on March 1, 1897, delivering the place in as good condition as it is at present.
“Witness our hands on the day and date first-above written.
“ (Signed in duplicate).
“ J. P. Duell,
“N. Y. Leslie,
“F. M. Cowell.”

Subsequently and before tbe cause was submitted, tbe further stipulation and agreement as to facts was submitted:

“In the Circuit Court of Scotland County, August Term, 1905.
“Now at this day, August 29', 1905, come the parties hereto in person and by attorneys and file by leave of court their further stipulation and agreement of facts in the above-entitled cause, to-wit:
“It is agreed that the yearly value of the rents and profits of the lands in question is two hundred .and fifty dollars from 1897 to 1904 inclusive.
“It is agreed that the defendants have expended in repairs and improvements on the lands in question since May 17, 1897, four hundred and fifty-four dollars and sixty-nine cents and that said expenditures were made at the times and on the date set out in the itemized account hereto attached and marked ‘Exhibit B.’
“J. A. Whiteside and Smoot, Boyd & Smoot,
“Attorneys for Plaintiffs.
“ J. M. Jayne and Mttdd & Pettingill,
“Attorneys for Defendants.”

There was attached to this stipulation “Exhibit B,” as designated in the stipulation, embracing an itemized account of the expenditures, amounting to the sum as set forth in the foregoing stipulation. It is not essential that this itemized account be'here reproduced.

As before stated, this cause was submitted to the court without the aid of a jury upon this agreed statement of facts and the court found the issues for the defendants and rendered judgment dismissing plaintiff’s bill and denying the relief sought by such bill. Timely motions for new trial and in arrest of judgment were, filed and by the court overruled. From the order and judgment dismissing plaintiff’s bill and denying the relief, this appeal is prosecuted to this court, and the record is now before us for consideration.

OPINION.

The record in this cause, which is now before ns, in effect propounds to this court the question as to what its conclusions of law are upon the agreed statement of facts disclosed by the record. The agreed statement in effect stands in lien of a special verdict and must be treated as such, and we are simply confronted with the proposition to. give expression to our conclusions of the law applicable to such agreed statement of facts.

It is manifest that upon the agreed statement of facts the overshadowing question to be determined in this proceeding is as to whether or not the warranty deed, to which reference is made in the agreed statement, executed by the plaintiffs to Leslie and Cowell, upon the facts as recited in such agreed statement, should be declared a mortgage. At the very inception of the consideration of this proposition, we find that upon the subject that deeds absolute on their face may be shown by a separate instrument or contract to be a mortgage, and as to the essential requisites of a mortgage and the distinguishing features between a mortgage and a conditional sale, there is practically no dispute between learned counsel for appellants and respondents as to the rules of law applicable to that subject. This controversy therefore is narrowed down to the question of the proper application of the rules of law, about which there is no dispute, to the facts embraced in the agreed statement. In other words, we have on the one side the contention that the facts as recited simply make this warranty deed a mortgage under the well-settled rules of law applicable to that subject. On the other side we have the equally earnest contention that the facts recited in the agreed statement clearly make the conveyance involved in this controversy a conditional sale upon the well-settled rules of law applicable to that subject, and also that the facts agreed upon negative any intention on the part of the parties to the contract of conveyance at the time of the execution of it that it should be treated as a mortgage to secure an indebtedness due from the plaintiff Duell to Leslie and Cowell.

I.

In equity a deed, although absolute on its face, may be shown to be a mortgage and courts in the exercise of their equity powers may declare it to be a mortgage and permit the grantor to redeem. About this proposition there can be no doubt. In Brant v. Robinson, 16 Mo. 129; Wilson v. Drumrite, 21 Mo. 325; Slowey v. McMurray, 27 Mo. 113; Worley v. Dryden, 57 Mo. 226 ; Reilly v. Cullen, 159 Mo. 322; Gerhardt v. Tucker, 187 Mo. 46, and many other cases, this equitable doctrine is fully recognized.

II.

A conveyance absolute upon its face will not be held to be a mortgage unless the relation of debtor and creditor exist between the grantor and grantee. In order to warrant the conclusion that the warranty deed in the case at bar was a mortgage, it is essential that the facts as agreed upon should show the existence of a debt due from the plaintiffs to Leslie and Cowell, and that it was the intention of the parties to the contract of conveyance in the execution of such warranty deed to secure the payment of such debt, or at least the facts agreed upon should be of that nature and character from which the legitimate inference might be indulged that such was the intention of the parties at the time of the execution of the warranty deed.

In the recent case of Jones v. Hubbard, 193 Mo. 147, it was expressly ruled by this court that in order to convert a deed absolute upon its face into, a mortgage it was essential that it should be alleged in the petition that there was a loan and that both parties so understood it at the time of the execution of the deed, and that it was not sufficient that one of the parties to an instrument of conveyance absolute in its terms intended it only as a mortgage. It was also ruled in that case that the allegation as above indicated was essential in order to form a basis for the introduction, of the proof of such averment. The conclusion finally reached in that case was that there were none of the usual concomitants of a mortgage, such as a loan; an obligation on the part of the grantee; a promise to allow the grantee to redeem, stated in the petition; and Judge Gantt, speaking for this court, in finally announcing the conclusions in that case, said: “Again and again it has been ruled that the one sure test and essential requisite of a mortgage has ever been the continued existence of a debt from the grantor to the grantee in the deed. If there is no debt the instrument cannot be a mortgage, whatever else it may be, [Bobb v. Wolff, 148 Mo. 344.] In Bailey v. St. Louis Union Trust Company, 188 Mo. l. c. 492, it was pertinently said: ‘If this absolute deed is a mortgage it is not so because of anything contained in it or in the agreement, but because of something outside of both by which the natural force and effect of these instruments must be controlled and varied. There is but one thing that can be shown under all the authorities that could have that effect, and that is that the deed, though absolute in form, was in fact given as a mere security.’ ”

Mr. Jones, in his treatise on Mortgages (3 Ed.), sec. 269, in discussing the subject now under consideration, says: ‘ ‘ There can be no mortgage without a debt. There may be agreements for the performance of obligations other than the payment of money; but leáving these out of view, it is essential that there be an agreement, either express or implied, on the part of the mortgagor, or some one in whose behalf he executes the mortgage, to pay to the mortgagee a sum of money either on account of a pre-existing debt or a present loan. ’ ’ This is the universally recognized doctrine applicable to the essential requisites of a mortgage; hence with this conclusion of what are the essential requisites of a mortgage and the necessity of such requisites being established by the facts in proof, we are then confronted with the proposition as to whether the agreed statement of facts upon which this cause was submitted establishes the relation of debtor and creditor between the plaintiff Duell and Leslie and Cowell to whom the warranty deed was executed, and whether or not the facts recited in the agreed statement are of such a nature and character from which the legitimate inference may be indulged that at the time of the execution of the conveyance they intended it only as a mortgage.

Measured by the rules of law as herein indicated, we see no escape from the conclusion that the agreed statement of facts upon which this cause was submitted absolutely fails to establish the ultimate fact which is sought to be reached by this proceeding, that is, that the warranty deed executed by the plaintiff was executed for the purpose of securing a debt due by the plaintiff, and therefore was insufficient to warrant the court in treating the conveyance as simply a mortgage to secure a debt due by the plaintiff to Leslie and Cowell. On the other hand, a careful analysis of the agreed statement of facts demonstrates that the conveyance of this land by the plaintiffs to Leslie and Cowell was a sale of it, burdened with and qualified by the condition contained in the agreement embraced in the agreed statement of facts which was entered into contemporaneously with the execution of the conveyance. It will be observed that the warranty deed is 'executed for the express consideration of $2,500 and the agreement recites the facts that Leslie and Cowell were to furnish the money to redeem this land from Mr. Eli Seeley and this agreement in its last analysis amounts to nothing more than this, that the plaintiff, J. P. Duell, was unable tO' redeem this land from Mr. Seeley and as indicated by the agreement, he did not expect that he could save the land itself, but as recited in the agreement he was desirous of saving what he could out of the land; therefore, for the purpose of giving the plaintiff, Mr. Duell, an opportunity of saving something out -of this land, it was agreed that either said Leslie or Cowell or said Duell might find a chance, to sell said land at not less than $27.50' an acre within the year 1896, and on said sale said Duell was to give peaceable possession on March 1, 1897, to purchaser or purchasers. Then follows the agreement that “out of the proceeds of said sale shall first be paid the amount of money expended in redeeming said premises, all taxes, judgments and liens on said place and all costs incurred by Leslie and Cowell in redeeming or defending said land and eight per cent interest thereon from time paid out by them. Said Duell to be charged rent at $250 per year, which he agrees to pay said Leslie and Cowell. Then on said sale the surplus proceeds of sale after paying off all claims, interest and costs shall be equally divided. One-half to said J. P. Duell and one-half to said Leslie and Cowell. The term surplus to include rent aforesaid. Should either party fail to find a sale for said lands before March 1, 1897, then this contract to be at an end and said land to be considered as deeded absolutely to said Leslie and Cowell and said Duell to give possession without further notice on March 1, 1897, delivering the place in as good condition as it is at present.”

It is manifest that the terms of the agreement as above recited absolutely negative the theory that the warranty deed as between these parties was to be treated as a mortgage. There is not a word embraced in the entire agreement which indicates that Mr. Duell, the plaintiff, might redeem this land and have it re-conveyed by Leslie and Cowell to him, and if it was understood that this was a mortgage, taken as a security for a debt, we are unable to comprehend why it was that Mr. Duell was agreeing to divide the proceeds with Leslie and Cowell over and above the amount of money they furnished in the extinguishment of his debt, for if it was understood that this warranty deed was simply to be held as a mortgage and security for the repayment of the money furnished by Leslie and Cowell, then clearly it should'have simply provided that Mr. Duell should have the right to pay the amount of money furnished for the extinguishment of his debt and take a reconveyance of the land to him; or if the land was sold during the year 1896 for not less than $27.50 an acre, then the proceeds over and above the amount necessary to repay Leslie and Cowell for the amount of money furnished in redeeming the land from Seeley, together with all expenses incurred, should be paid over to Mr.' Duell. The agreement embraced no such terms, nor does it embrace any language from which a legitimate inference might be drawn that it was the intention of the parties in the execution of the warranty deed that it should be held and treated as a mortgage. This agreement manifestly was intended to give Mr. Duell a last chance to save something out of this land and postpone for at least a year the evil day when he would be required to give possession of it under his conveyance, and allow him the opportunity of at least trying to effect a sale of the land for a sum not less than $27.50' an acre and thereby secure some of the proceeds, as is indicated by tbe terms of tbe agreement.

Jones, in bis work upon Mortgages (3 Ed.), section 270, thus states tbe rule of law as applicable to tbe case at bar. He says: “"Where tbe grantee’s covenant, executed at tbe same time with an absolute conveyance to Mm, recited that this was made for the purpose of paying a certain sum' of money, and stipulated that he would not convey the premises within one year without the consent of the grantor, and, if the grantor, within that time, should find a purchaser, the grantee would convey the land on receiving the amount with interest for which the land had been conveyed to him; and that in case such sale should not be made within the year, it should then be submitted to certain persons named, to determine what additional sum the grantee should pay for the land, which snm he covenanted to pay, the transaction was held not to be a mortgage, but a conditional sale giving the grantee the right to recover possession of the land, after the expiration of the year, in ejectment against the grantor. In like manner an agreement by the grantee made as a part of the transaction whereby he is to account to the grantor for a portion of the profits which may be realized on a resale of the premises if made within a specified time, and requiring him to sell if a specified price can be obtained, is not inconsistent with the vesting of the title.”

It must not be overlooked, as was, said in Bailey v. Trust Co., 188 Mo. l. c. 492, that the ultimate fact in all the cases which converts an absolute deed into an equitable mortgage is that it was given merely as a security.

The plaintiff, Mr. Duell, executed his warranty deed to the land involved in this controversy doubtless with the understanding that Leslie and Cowell would extinguish his debt to Mr. Seeley. It follows that Leslie and Cowell, in order to perfect their title and give force and vitality to the conveyance executed to them by Mr. Duell did pay to Mr. Seeley the amount of money due by the plaintiffs, thereby extinguishing his debt. This court, in Bobb v. Wolff, 148 Mo. l. c. 348, in discussing the law applicable to this subject, said: “The distinction was early made by this court in Slowey v. McMurray, 27 Mo. 113, in which Judge Scott adopts Chancellor Kent’s text with approval to the effect 'that if the relation of debtor and creditor remains, and a debt still subsists, it is a mortgage, but if the debt is extinguished by the agreement of the parties or the money advanced was not by way of loan and the grantor has the privilege of refunding if he pleases by a given time, and thereby entitling himself to a reconveyance it is a conditional sale.’ As already said, when Wolff surrendered his note and unconditionally assumed the $4,00() mortgage to another person, the debt was extinguished. There was left no basis for a mortgage, and it is far more consonant with reason and common business experience to- say that if this evidence tends to prove any agreement with certainty, it was no more than an agreement to permit Bobb within a limited time which had expired prior to November 17, 1886, to repurchase the lot, and having failed and not having brought himself within his agreement, he has lost that right.” [Citing Turner v. Kerr, 44 Mo. 433; Forrester v. Moore, 77 Mo. 661.]

We have been unable in any of the adjudications to find the proposition now under consideration more logically and clearly presented than in the case of Turner v. Kerr, 44 Mo. 429, and what was said by this court in treating of the question now under consideration is so appropriate to the case at bar that we will be pardoned for making such a lengthy quotation. It was there said:

“In considering the subject, it is at once to be admitted that a conveyance to secure a subsisting debt is a mortgage, whatever may be the form of the deed, or however absolute it may appear upon its face. It is also true that, where the facts of the transaction leave it questionable whether a mortgage or a conditional sale was intended, the doubt is to be resolved in favor of the theory of a mortgage.
“But it is npt true, as a result of the adjudged cases, that a deed absolute in its terms, delivered in payment of a debt, is converted into a mortgage merely because the grantee therein (the creditor) gives a cotemporaneous stipulation binding him to convey on being reimbursed, within an agreed period, an amount equal to his debt and the interest thereon.
“In passing on transactions of this class, the understanding and purpose of the parties thereto are to be considered and respected as in other cases. If they intended an extinguishment of the debt, and the vesting of an absolute title, subject only to an agreement to reconvey upon specific terms — as a payment of an amount equal to the canceled debt and interest — the objects of the arrangement are not to be defeated by turning the transaction into a mortgage, when the parties intended no such result. That the amount of money to be paid as a condition to the right to demand a reconveyance is measured by the amount of the debt and interest, is a circumstance of no controlling importance. It settles nothing. It may often happen that a creditor would consent to take an absolute stipulation for a reconveyance, when he would reject a mortgage because of the delay and expense to which he might be subjected upon a foreclosure. Such arrangements operate beneficially to the debtor, securing to him additional time and renewed opportunities to extricate himself from embarrassment. Where the parties intend a conditional sale, and not a mortgage, and make their contracts in accordance with their intentions, it is not the province of the courts to circumvent and frustrate their intentions. It is nevertheless true that neither the intention of the parties nor their express contracts can change the essential nature of things. A conveyance to secure a debt is a mortgage, and the stipulations of the parties cannot make it otherwise. But a conveyance to pay a debt is a totally different affair. If the conveyance extinguishes the debt, and the parties so intend, so that a plea of payment would bar an action thereon, a subsequent or cotemporaneous stipulation in the interest of the debtor, securing to him an opportunity to reacquire the title, ought not to be construed to the creditor’s prejudice. Such a transaction is no mortgage, but a conditional sale.”

In Slowey v. McMurray, 27 Mo. 113, the question in judgment before the court was as to whether or not the conveyance was to be construed as a mortgage or a conditional sale. The facts in that case were substantially as follows: Slowey owned a lot in St. Louis subject to a deed of trust to secure $616 due in twelve months, and $682 due in twenty-four months. McMurray loaned Slowey $300, and Slowey gave McMurray $316 and the money thus loaned, and with it McMurray paid off the $616 note when it became due, and took the note up and kept it. Slowey paid $200 on the McMurray debt. When the $682 became due Slowey failed to pay it, and the trustee advertised the same for sale. Before the sale it was agreed between Slowey and McMurray that McMurray should bid the same off in his own name for the benefit of Slowey, pay the said $682, and if Slowey would pay back to said McMurray within one year the $682 and $150 balance due on the $300 loaned by McMurray, McMurray would reconvey the lot to Slowey. McMurray bid in the land for $1,005, August 14, 1855, and by agreement Slowey occupied the property in the meantime. McMurray sold the lot to Ackerman November 17,1855, who bought the lot with knowledge of the above facts, and Slowey sued to annul the deed to Ackerman, and if the court should not cancel the deed, then he asked judgment for $323, the overplus, and $995, the value of the land and improvements over $1,005. After the year passed by Slowey tendered to McMurray the full amount which was due him, with interest. Judge Scott, speaking for this court, after an exhaustive review of all the authorities applicable to this subject, said: “Making an application of these principles to the case before us, it will be seen that the contract or promise made by McMurray, even if binding in law, constituted the transaction a conditional sale and not a mortgage; that the party plaintiff not having complied with the terms of the sale, he cannot insist on a reconveyance of the lot.”

In Macaulay v. Porter, 71 N. Y. l. c. 176, it was claimed, as in the case at bar, that a deed though absolute in form was in effect only a mortgage. The facts in that case upon which the claim was predicated, were substantially as follows: That Miss Tracy applied'to defendant Porter to make a sale of the land for her, which he was not able to do; that she then applied to him to purchase the land himself, which he agreed to do, and pay therefor $2,500 — $1,200 by assuming the existing mortgage, and $1,300' in cash— and further agreeing that he would sell the property within one year, at the discretion of Miss Tracy and himself, and divide the profits equally with her; and if not sold within the year, Miss Tracy’s interest in the premises to cease; that before the arrangement was consummated, Miss Tracy ascertained that she needed more money, and Porter agreed to loan her $500 on her note, at one year; that in pursuance of this agreement, Miss Tracy executed and delivered the deed in question, and the parties at the same time executed a written agreement, under seal, as follows: “In consideration of tlie sale and conveyance of a lot, forty-four feet front by 408% feet deep, on the east side of Alexander street, by Miss L. Tracy to S. D. Porter, I, S. D. Porter, agree to take said property subject to a mortgage to the Rochester Savings Bank of $1*,200; all other incumbrances and taxes to be paid off by Miss Tracy; and I will pay her in cash, $1,300 and I will sell the property, at her discretion and mine, within the year-, and divide the profits equally. I will Ran her $500, and take her note, to be paid within the year, or sooner, if the property is sold. If the property shall be sold for $4,000 within four months, I will cancel the note and surrender it to her. The premises may be sold at the option of either party for not less than $4,000. If not sold within one year from date, all interest of Miss Tracy in the premises shall cease.” Responding to that state of facts it is said by the court in that case: “Upon these facts, the court held that the defendant Porter, under his deed, took the fee of the land, subject to no other condition than that he should account to Miss Tracy for one-half of the profits on a sale thereof if made within the year, and that tbe plaintiff’s mortgage was void as to him. It is difficult to see how the court could have arrived at any other conclusion. The agreement was not a defeasance, which was to render the deed void on the payment of any sum of money, nor was there anything in the transaction in the nature of a mortgage. Porter was not a creditor, taldng the land to secure any debt. No debt existed or was created in respect of the $2,500 paid for the property. If the land had depreciated, Porter would have had no claim for reimbursement, nor was any privilege reserved to Miss Tracy to redeem it on payment of any sum. These circumstances are of great importance in determining the character of the transaction. There was no condition attached to the grant, upon which it was to become void and the property revert to the grantor. The agreement clearly shows that the title was to pass to Porter; that he should have power of disposition over it, and that all he undertook to do was to account to his grantor for' one-half of the profits which might be realized by him on a resale if made within the year, and that he would not sell within the year for less than $4,000 without the consent of Miss Tracy. Such an agreement is not inconsistent with the vesting of the title in him, and to record such a deed and agreement as a mortgage would have been clearly improper. ’ ’ To the same effect is Glover v. Payn, 19 Wend. 518.

In Baker v. Thrasher, 4 Denio (N. Y.) 493, substantially the same legal propositions were involved as in the case at bar. There was am absolute deed executed, which was qualified by a covenant executed on the same date, reciting that the conveyance was made for the purpose of paying a sum of money which was unsatisfied and covenanting that he would not convey the premises within one year without the consent of the grantee in the absolute deed, and if the grantor within that time found a purchaser the grantee would convey to such purchaser, on receiving the amount with interest for which the land had been conveyed to him, and it was further recited that in case such sale should not be made within a year it should then be submitted to certain persons named, to determine what additional sum the grantee should pay the grantor for the land conveyed in the absolute deed, which sum the grantee covenanted to pay. It was held in the case that the transaction did not amount to a mortgage and that the grantee was entitled to recover in judgment against the grantor for the land. Chief Justice Bronson, speaking for the court, in .discussing the absolute deed and the contemporaneous instrument qualifying it, said: “These two instruments must undoubtedly be read and construed together; hut they do not make a mortgage. A mortgage is a conveyance of lands, upon a condition in the deed, or a defeasance out of it, that on the grantor’s paying a sum of money, or doing some other act, the conveyance shall be void; and performance of the condition, without any other act, puts an end to all title and interest in the grantee. Some modern cases have held, and such are cited at the bar, that although there be no condition or defeasance under which the deed may be avoided, but only a collateral agreement that the grantee will reconvey to the grantor on payment of the money, the transaction amounts to a mortgage. But this is not a case of that kind. There was no condition or agreement under which the title could ever become revested in the grantor. It was to remain in the grantee, or the person to whom he should convey in pursuance of the covenant. And besides, the conveyance to the plaintiff was not by way of security for the debt which the defendant owed the plaintiff; but in payment of the debt. No debt or duty of any kind remained upon the defendant. It was in any and all events a sale of the land. It was a sale for the consideration of $1,160.25, which the defendant then owed the plaintiff, and which debt was satisfied by the conveyance; and the further consideration of the covenants which the plaintiff made to pay off the judgment, and give the defendant any better price which could be obtained for the land within a year; and if the land should not be sold within the year, then to pay the defendant such further sum for the land as might be determined by the award of arbitrators. It is impossible to hold that this is a mortgage, or anything in the nature of a mortgage.”

We see no necessity for pursuing any further the consideration of the propositions disclosed by the record. We are clearly of the opinion that the agreed statement of facts does not establish one of the legitimate facts to be alleged, that is, that tbe relation of debtor and creditor existed between Mr. Dnell and •Leslie and Cowell, and tbe facts agreed upon are insufficient to warrant tbe conclusion that the warranty deed executed by Mr. Duell to Leslie and Cowell was only a mortgage, or that the parties to the warranty deed, at the time of its execution, intended that it should only be treated as a mortgage. It is manifest that upon the agreed statement of facts Leslie and Cowell or tbe grantees of their interest in this land could not have successfully maintained a proceeding to foreclose the transaction respecting the warranty deed as an equitable mortgage, and it is equally clear that had this land depreciated in value and upon a resale of it had failed to realize the amount that they had expended in the extinguishment of Mr. Duell’s debt to Mr. Seeley, a recovery could not be had against Mr. Duell for the difference between the amount realized from the sale and the amount paid in the extinguishment of Mr. Duell’s debt. This could not be done for the reason that upon the agreed statement of facts the relation of debtor and creditor is not shown to exist.

In reaching the conclusions upon the propositions presented to our consideration in this cause we have not been unmindful of the authorities cited by learned counsel for appellant. We have carefully considered the cases cited, and it is sufficient to say of those cases that the facts upon which the conclusions were announced distinguish them from the case at bar.

We have given expression to our views upon the questions presented by this record, which result in the conclusion that the judgment of the trial court in denying the relief sought by the plaintiffs and dismissing their bill should be affirmed, and it is so ordered.

All concur.