text:
    JOPLIN BREWING COMPANY v. PAYNE et al., Appellants.
    Division Two,
    June, 19, 1906.
    1. LIMITATIONS:- Color of Title: Divorce: Alimony: Sheriff’s Deeds. An instrument of writing purporting to convey a certain tract of land, describing the same, is color of title. A sheriff’s deed, made by him in pursuance to a sale under judgment in favor of the wife in a suit for divorce against her husband, the landowner, in which she recovered alimony, and to pay which the land was sold, the judgment being void because the service being by publication the court did not acquire jurisdiction over him by personal service or otherwise, is color of title.
    2. -: -: Adverse Possession: Homestead: Minors. One who has been in the actual, adverse, notorious and exclusive possession of a lot or a part of the lot, under color of title to the whole lot, for ten consecutive years, is the absolute owner of the lot. And that is true even though the lot was the homestead of a husband who had abandoned his wife leaving her and minor children in possession, and the color of title was a sheriff’s deed under a void judgment in the wife’s favor for divorce and alimony — the adverse possession beginning after the abandonment by her and the minor children of the premises after the sale by the sheriff.
    3. -: Dower. The fact that the wife after the adverse possession began became .entitled to dower in the lot owned by her husband, did not interfere with the title acquired by ten years’ adverse possession against him.
    4. -: Homestead. The statute relating to limitations and adverse possession makes no exception of land claimed as homestead, but is broad enough to cover all land, however held or claimed.
    5. -: -: Sale. An abandoned wife’s right to homestead in her husband’s land is not such a right as may be sold by her during the life of the husband.
    6. -: Abandoned Wife: Homestead: Quarantine: Dower. The lot was acquired in 1875, and occupied by the owner as his homestead and in 1880 he abandoned his wife and went to Texas leaving her and his children, some of whom were minors, in possession.1 In 1881 she sold the premises, and she and the children abandoned them, and plaintiff, under the deed from her and under a deed from the sheriff who sold the land under a void judgment in her favor for divorce and alimony, went into possession and has since been in possession. And now the husband’s heirs assert that the homestead became vested in her at the time he abandoned, his family; that, having subsequently married, she had the right to occupy the premises until dower was assigned; and that as dower was never assigned and she did not die until 1900, their claim is not barred by limitations. Held, first, that the homestead right did not become vested in the wife and children until the husband’s death in 1887, long after the Statute of Limitations had begun to run; second, she was not entitled to dower until his death, and that right accrued immediately upon his de.ath in 1887, and was barred at the time this suit was begun in 1902; and, third, neither she nor the children, because of their homestead or her dower or quarantine right, had any such interest as prevented the Statute of Limitations from running against her husband, and having abandoned the premises in 1881 they are barred by the Statute of Limitations, since plaintiff has since that time been in actual adverse possession.
    Appeal from Barton Circuit Court. — Eon. E. G. Timmonds, Judge.
    Affirmed.

      E. 8. Miller for appellants.
    (1) Plaintiff failed to show title by adverse possession. Robinson v. Allison, 97 Ala. 596; Padgett v. Norman, 44 Arle 490; Fisher v. Siekmann, 125 Mo. 165; Nnll v. Howell, 111 Mo. 273; Holmes v. Kring, 93 Mo. 452; Nixon v. Williams, 95 N. C. 103; Merriwetlier v. Vanlx, 37 Tenn. 300; Wheelock v. Overshiner, 110 Mo. 100; Bowman v. Lee, 48 Mo. 335; Dalby v. Sniffer, 57 Mo. 294; Laramore v. Minnish, 43 Ga. 228; Dnhring v. Dnhring’, 20 Mo. 176; Thomas v. Black, 113 Mo. 166; Ambrose v. Raley, 58 111. 506; Lemonie v. Dnnklin Co., 38 Fed. 567; Shipman v. Baxter, 21 Ala. 456; Boril v. Rollins, 30 Cal. 408; Clark v. Lyon, 45 111. 388; Champaign v. McMnrray, 76 111. 353; Moss v. Berry, 53 Tex. 632; Pharis v. Jones, 122 Mo. 125; Gaines v. Sannders, 87 Mo. 557; Norfleet v. Hutchins, 68 Mo. 597; Cook v. Farrah, 105 Mo. 492; Cantlin v. Land & Lumber Co., 151 Mo. 159; Sweringen v. St. Louis, 151 Mo. 348; Carter v. Hornback, 139 Mo. 238. (2) Upon the entire record the finding, judgment and decree should have been for the defendants. Stokes v. McAllister, 2 Mo. 163; Jones v. Manley, 58 Mo. 559; Brown v. Moore, 74 Mo. 633; Kane v. McKown, 55 Mo. 181; Gentry v. Gentry, 122 Mo. 216; Melton v. Fitch, 125 Mo. 281; Sherwood v. Baker, 105 Mo. 472; Fischer v. Siekmann, 125 Mo. 165; Carey v. West, 139 Mo. 177; Osborn v. Weldon, 146 Mo. 192; Westmeyer v. Gallenkamp, 154 Mo. 28; Graham v. Stafford, 171 Mo. 692; Blandy v. Asher, 72 Mo. 27; Sellon v. Reed, 5 Biss. 125; Bonnell v. Smith, 53 111. 375; Van Zant v. Van Zant, 23 111. 536; Haselton v. Haselton, 166 Mo. 185; Rohrer v. Broekhage, 86 Mo. 544; Lyons v. Lyons, 101 Mo. App. 494; WMtehead v. Tapp, 69 Mo. 415; Gladney v. Berkley, 75 Mo. App. 102; Thompson on Homestead, see. 690, p. 564; Phillips v. Presson, 172 Mo. 24; Duffy v. Harris, 40 L. R. A. (Ark.) 750; Huffschmidt v. Gross, 112 Mo. 649; Peake v. Cameron, 102 Mo. 568; Vogler v. Montgomery, 54 Mo. 574; Stamm v. Stamm, 11 Mo. App. 598; Kendall v. Powers, 96 Mo. 142; Rockhey v. Rockhey, 97 Mo. 76; Freund v. McCall, 73 Mo. 343; Lake v. Page, 63 N. H- 318; Skouten v. Wood, 57 Mo. 380; Day v. Adams, 42 Vt. 516; Mack v. Heiss, 90 Mo. 578; Roberts v. Nelson, 86 Mo. 25; McPhee v. O ’Rourke, 10 Col. 301; Apafford v. Warren, 47 Iowa 47; Hart v. Evans, 80 Ga. 330; Gunney v. Doane, 22 Cal. 635; Alexander v. Alexander, 52 111. 195; Monroe v. May, 9 Kan. 466.

      O. H. Montgomery and A. E. Spencer for respondent.
    Respondent has title by adverse possession under the Statute of Limitations. Respondent and the parties under 'whom it claims were in the actual possession of the whole of the lot for more than twenty-one years before appellants filed their answer claiming title; but if they had been in possession of only a part, their color of title would have extended their possession to the whole lot. Sec. 4266, R. S. 1899 ; Stevens v. Martin, 168 Mo. 407. Ten years unbroken possession by the grantee of a part of a tract, after the recording of the deed under which he holds, gives him title to the whole. Plaster v. Grabeel, 160 Mo. 669; Scannell v. Co., 161 Mo. 606. Color of title is not necessary to originate ownership by limitation; a claim of title with adverse possession of the requisite character for the requisite period will carry title without any paper support. Quick v. Rufe, 164'Mo; 408; Scannell v. Co., 161 Mo. 606. The Statute of Limitations commenced to run against Martin V. Payne in his lifetime and did not stop at his death. Jones v. Thomas, 124 Mo. 586; Burdett v. May, 100 Mo. 19; Campbell v. Co., 84 Mo. 353. Occupancy is necessary to the homestead right. Visible occupancy of the premises as the head of the family at the time of the levy of the writ fixes the homestead rights of the defendant. St. Louis Brewing Assn. v. Howard, 150 Mo. 451; Beckman v. Myer, 75 Mo. 333; Finnegan v. Prindville, 83 Mo. 517. The visible occupancy of the premises as the head of a family under a recorded title, fixes the character of the property as a homestead. Jackson v. Bowles, 67 Mo. 610; Graham v. Lee, 691 Mo. 334; Beckman v. Myer, 7 Mo. App. 576. Even if Mrs. Payne had a right of homestead, such right during the life of her husband, Payne, owner of the fee, was not a thing that could be sold, hence, nothing could pass from her to Keller by her quit-claim deed. Thomp. on Homesteads and Exemp., sec. 452; Blandy v. Asher, 72 Mo. 27; Gladney v. Berkley, 75 Mo. App. 101; Quick v. Rufe, 164 Mo. 414. During the life of both parents, the children have no interest in the homestead. Thomp. on Homestead and Exemp., sec. 43. A homestead is lost by abandonment, and a party cannot have two homesteads. Kaes v. Gross, 92 Mo. 647; Rouse v. Catón, 168 Mo. 288.
   BURGESS, P. J.

This is a suit to ascertain, determine and quiet the title to lot numbered seventy-three, in Porter’s addition to Murphysburg', now in the city of Joplin, Jasper county, Missouri. The suit was commenced in the circuit court of Jasper county, but was by a change of venue transferred to the Barton Circuit Court, being tried at the January term, 1903, of said court.

The plaintiff claims title to the real estate in question by adverse possession under color of title, the color of title being claimed through a deed executed by the sheriff of Jasper county to G. W. Keller, on the 16th day of June, 1881, and also a quitclaim deed executed by Rosanna Hicks, formerly Rosanna Payne, wife of M. Y. Payne, on June 16, 1881, to said Keller.

The defendants are the lawful heirs of Martin Y. Payne, deceased,- both parties to the suit admit that the common source of title was in Martin Y. Payne.

The judgment on which execution was issued against Martin V. Payne and under which the lot in question was sold by the sheriff was a personal money judgment for alimony in favor of said Rosanna Payne, wife of Martin Y. Payne, by reason of a divorce proceeding instituted by said Rosanna Payne against her said husband. The property was sold by the sheriff and purchased by G. W. Keller for one hundred and fifty dollars. Said Keller and wife, by quit-claim deed, dated February 4, 1884, transferred and sold said property to George Muennig- and Nicholas Zentner. On August 7, 1888, Muennig and wife transferred their half interest in said property to said Zentner. Nicholas Zentner and wifé, on March 8th, 1894, sold and transferred, by warranty deed, said property to the plaintiff, The Joplin Brewing Company.

The material facts developed hy the testimony are as follows:

Martin V. Payne bought the lot in question in 1875, and lived thereon with his wife and family of five children until 1879, when he abandoned his family and went to Texas. On April 12,1880, Rosanna. Payne filed a petition for divorce from her husband, said Martin Y. Payne, on the ground of adultery; publication service was had, and the divorce was granted December 16, 1880. She was awarded the care and custody of her two infant children, and the court gave her a personal judgment for alimony for $250 on publication service. After Payne had gone to Texas, Mrs. Payne rented the place to Marion Hicks, her son-in-law, and for a time she lived with her said son-in-law. Afterwards she married another man named Hicks and went with him to North Missouri and made her home there on a farm. Her family were nearly all grown at this time; the youngest, Martin Y. Payne, twelve years old at the time of the sale to Keller (died November 19, 1887), had lived with his sister and brother-in-law, Marion Hicks, until he moved off from the lot in controversy before the sale to Keller, and went to live with his sister, Mrs. Mefford, in Galena, Kansas.

James Walter Hicks, sixteen years old in 1881, worked in Lone Elm, and.went to the house of his brother-in-law on Saturday nights.

Nancy Elizabeth Payne married Marian Hicks, who lived on the place in controversy until a few weeks before the sale to Keller.

Charles Lewis Payne, born in 1861, went to North Missouri in 1880, and made his' home there.

Anna Mefford married some years before, and made her home in Galena, Kansas.

On 'June 16, 1881, when the lot was sold by the sheriff to Keller, Mrs. Payne executed to Keller a quitclaim deed to said property, but her then husband, Hicks, did not join with her in said deed. The money for the lot was paid her, and she then went to North Missouri where she made her permanent home. According to the evidence, Rosanna Payne Hicks died on May 25, 1900, and Martin V. Payne, her former husband, on November 19', 1887.

All the Paynes left the lot, remained away therefrom, and never made any claim thereto for more than twenty-one years, or until the defect of plaintiff’s record title was pointed out by plaintiff’s suit to quiet title.

The evidence tended to prove that the plaintiff and its grantors had been in adverse possession of the property in controversy for twenty-one years, and the defendants offered no evidence to rebut the evidence of plaintiff’s witnesses in this regard.

The court, under the evidence submitted, found that for more than twenty-one years before the Payne heirs claimed the lot, the plaintiff and its grantors had been in the open, notorious, peaceable, adverse and continuous possession thereof, under color of title and claim of ownership, and that'plaintiff is the absolute owner of the lot in controversy, and that the Paynes had no right or title in or to said lot. That the homestead right, if not abandoned, was in the husband, Martin Y. Payne; that the divorce of Mrs. Payne did not change his status with regard to the property; that the Statute of Limitations commenced to run against Martin V. Payne during his lifetime,, and having commenced to run, did not stop at his death.

Defendants duly filed motion for new trial, which was overruled, and they appeal.

While the judgment on which execution was issued against Martin V. Payne, and under which the lot in question was sold by the sheriff, was a personal money judgment for alimony in favor of his wife, Rosanna Payne, in a suit for divorce by her against her said husband, and was void for the reason that the court had not acquired jurisdiction over said Martin y. Payne by service of process ,or otherwise, it does not follow that the sale of said lot to Keller and deed made to him by the sheriff on June 16,1881, under execution issued upon said judgment, was not color of title. We think it was. Any instrument of writing which purports to convey a certain tract of land, describing the same, is color of title. ’ [Hamilton v. Boggess, 63 Mo. 233; Hickman v. Link, 97 Mo. 482; Allen v. Mansfield, 108 Mo. 343; Suddarth v. Robertson, 118 Mo. 286; Wilson v. Taylor, 119 Mo. 626; Quick v. Rufe, 164 Mo. 408.]

Keller, on the 16th day of June, 1881, obtained from Rosanna Hicks (late Payne) a quit-claim deed to the same lot, and on the same day entered into the actual possession thereof, claiming title thereto, and so remained in possession until the 4th day of February,' 1884, when he and his wife conveyed said lot, by deed, to Gleorge Muennig and Nicholas Zentner, from whom plaintiff, by mesne conveyances, acquired color of title to said property.

If, as the evidence tends to show, plaintiff and those under whom it claims title, were in the actual, adverse, notorious and exclusive possession of the lot in question for ten consecutive years or more, under color of title to the whole lot, or to part of the lot, claiming title to the whole, it is the absolute owner of said lot. [Sec. 4266, R. S. 1899; Stevens v. Martin, 168 Mo. 407; Cunningham v. Snow, 82 Mo. 587; Allen v. Mansfield, 82 Mo. 688; Plaster v. Grabeel, 160 Mo. 669; Scannell v. American Soda Fountain Co., 161 Mo. 606.] The Statute of Limitations began to run against Martin Y. Payne when Keller took possession in 1881, and having been put in motion did not stop when Payne died, on November 19, 1887, nor would the fact that Mrs. Payne became entitled to dower, after adverse possession of the lot was taken by Keller, affect the operation of the statute. [Jones v. Thomas, 124 Mo. 586.]

Section 4262, Revised Statutes 1899, provides: “No action for the recovery of any lands, tenements or hereditaments, or for the recovery of the possession thereof, shall he commenced, had or maintained by any person, whether citizen, denizen, alien, resident or nonresident of this State, unless it appear that the plaintiff, his ancestor, predecessor, grantor or other person under whom he claims was seized or possessed of the premises in question, within ten years before the commencement of such action. ’ ’

It will be observed that this statute makes no exception of land claimed as homestead, but is broad enough to cover all kind of land, however held or occupied. It must, therefore, apply to the lot in question. The homestead law at the time Payne abandoned his family and homestead only exempted the homestead from attachment and execution for debts contracted after the acquisition of the homestead, and did not prohibit the mortgaging or sale of it by him; and it would seem that if these things could be done under the homestead law the Statute of Limitations would apply to land claimed as a homestead as well as to lands not so occupied. To hold otherwise would be to legislate into the Statute of Limitations a provision exempting homesteads from the operation thereof, which this court has no power or authority to do. It makes no difference whether Payne left his family and homestead, with the intention of abandoning them or not. When Keller acquired possession of the homestead, with the intention of holding and claiming it as his own, his possession was adverse from that time on.

But defendants insist that, according to the evidence, Martin Y. Payne and family occupied the homestead in question as their home, which was all the property they owned, from the time of its purchase, in 1875, until Mrs. Payne conveyed the lot by quit-claim deed to Keller on June 16, 1881; that the homestead became vested in her at the time her husband abandoned his family; that she had the right to occupy the premises until dower was assigned, or during her life, and that as dower was never assigned, and she did not die until May 25, 1900; there could be no adverse possession of the property until that time. But the homestead right did not become vested in the wife and children of Payne until his death, November 17, 1887 (sec. 2693, chap. 39, R. S. 1879) long after the Statute of Limitations had begun to run against him. Nor until the death of Payne was the wife entitled to dower, and if such right she had she never asserted it during her life so far as the record discloses, and no one can do so now that she is dead. Besides, her right of action for assignment of her dower accrued immediately upon the death of her husband, Payne, and was barred by ten years’ adverse possession next thereafter. [Robinson v. Ware, 94 Mo. 678; Long v. Kansas City Stock Yards Co., 107 Mo. 298.]

In Quieke v. Rufe, 164 Mo. l. c. 414, Marshall, J., speaking for the court, said: “The only obstacle in the way of the running of the Statute of Limitations, therefore, that has been suggested, is that the widow’s dower had never been assigned to her, and therefore she was entitled to quarantine until her dower was assigned. But even this will not avail the plaintiffs, for, as pointed out, such quarantine is only a personal right of the widow to remain in the mansion house of the deceased husband until her dower was assigned her, and the widow abandoned that right in 1866, when she sold the property, and in any event she has not attempted to exercise it since 1881.”

But even if Mrs. Payne had a right of homestead, such right, during the lifetime of her husband, who was the owner of the lot in fee, was not such an interest in the homestead as could be sold; hence nothing passed from her to Keller by her quit-claim deed. In Thompson on Homesteads and Exemptions, section 452, it is said:

“Whatever views are entertained as to the interest in land created by a Statute of Homestead — whether it rises to the dignity of an estate, or sinks to the level of a mere negative immunity from dispossession-all courts agree that it is not such an interest in lands as is alienable separately from the fee. In this respect it sustains a strict analogy to the right of dower. Either may be released to the alienee of the fee so as to merge therein, but neither can be aliened separately. The same rule obtains as to exempt chattels. The chattel itself may be sold, and it will be exempt or not, in the hands of the vendee, accordingly as he answers the description of the Statute of Exemptions; the thing may be sold, but the exemption is a personal privilege, incapable of alienation.”

Mrs. Payne abandoned the property as a homestead, and turned the possession thereof over to Keller, and there can be no question that, thereafter, his possession was adverse.

The trial court found that plaintiff and those under whom it claimed title to the lot in question had been in the open, notorious, peaceable, adverse and continuous possession thereof, under color of title and claim of ownership, for twenty-one years, and that plaintiff is the absolute owner thereof, and that neither of the defendants had any right, title or interest in or to said real estate. The finding was well supported by the evidence, and the conclusion reached was in accordance with the law of the case. Our opinion is that the judgment should be affirmed. It is so ordered.

All concur.


source: Caselaw Access Project

author: GANTT, J.

license: Public Domain

text:
    BUMGARDNER, Appellant, v. WEALAND.
    Division Two,
    June 19, 1906.
    1. LIMITATIONS: Mortgages and Debts: Act of 1901. It was the purpose of the act of 1901 (now secs. 4276 and 4277, R. S. 1899) to provide that deeds of trust and mortgages executed after that act went into effect should continue in force only so long as the debts they were given to secure were not barred by the Statute of Limitations, and to repeal the right to enforce them for twenty years and after the obligations they secured were barred.
    2. -: -: -: Prospective. That act is prospective only.
    3. -: -: -: Two-Year Provision. The language of that act in reference to the two-year limitation was meant to give holders of mortgages and deeds of trust given to secure debts already barred by limitation two years after its passage in which to enforce their mortgages and deeds of trust then enforcible. It was not meant to be applied to obligations which had been executed before the passage of the act and which were not then barred but would be barred within two years after the act went into effect.
    4. -: -: -: Application. That act is applicable only to those whose debts, secured by mortgages and deeds of trust, were barred when the act was passed.
    Appeal from Vernon Circuit Court. — Now. N. G. Timmonds, Judge.
    Affirmed.

      S. A. Wight for appellant.
    The note was barred by the Statute of Limitations on the 10th day of January, 1902. The trial court so found. The deed of trust under the act of 18 February, 1891 (R. S. 1899, sec. 4277), was barred at the same time, or within two years from February 18, 1891. Little y. Reid, 75 Mo. App. 266; Stanton y. Gibbins, 103 Mo. App. 264.

      A. J. King and Scott & Bowlcer for respondent.
    Sections 4276 and 4277, Revised Statutes 1899, have no application to a deed of trust created before the passage of the act, and in which the note was not barred at the time of the passage of said act. Little v. Reid, 75 Mo. App. 266.
   GANTT, J.

This is a statutory proceeding under section 650, Revised Statutes 1899', to determine the title respectively as between plaintiff and defendant to the northeast quarter of the northwest quarter of section 13, township 34, range 30, in Vernon county, of this State.

The facts are undisputed. On January 10, 1887, J. R. Shelton was the owner of said land and on that day borrowed from the defendant, Wealand, three hundred dollars, and gave him his note for three hundred dollars, due five years after that date, to-wit, January 10, 1892, with- five interest coupons for thirty dollars each, all due on or before January 10, 1892, and secured the same by a deed of trust, in proper form, on the land in suit. Shelton afterwards conveyed the land to plaintiff. Plaintiff paid all the interest notes as they matured, the last payment being January 10,1892, and has paid nothing’ on said note since the last-mentioned date. The defendant took no steps to enforce the deed of trust until January 14, 1903, on which day the land was sold by the sheriff of Vernon county as substituted trustee and defendant bought it in and took a trustee’s deed thereto.

The circuit court held that the note was barred by the ten-year Statute of Limitations, but that the deed of trust was not barred; that the possession of plaintiff was not adverse to said deed of trust nor the holder thereof, and the deed of trust was in full force and effect when the same was foreclosed and defendant became the owner in fee by virtue of the sale and trustee’s deed to him. The circuit court expressly held that sections 4276 and 4277, Revised Statutes 1899, had no application to the facts of this case. Plaintiff appeals.

It it conceded by both parties that unless the facts detailed bring this case within the provisions of the act of February 18, 1891, now section 4277, Revised Statutes 1899, the judgment of the circuit court must be affirmed, as prior to the passage of that act the deed of trust would not have been barred until twenty years after the maturity of the note, notwithstanding the note itself was barred January 10, 1902.

It is obvious that section 4276, Revised Statutes 1899, had no application to the facts of this case be-' cause ex vi termim that section is limited to mortgages and deeds “executed thereafter,” and this deed of trust was executed in 1887, four years before the passage of said act.

Has section 4277 any application to the deed of trust herein which did not mature until after the passage of the act? The note secured by the deed of trust in this case was not barred at the time of the passage of the act. Section 4277 is in pari materia with section 4276, and by its terms expressly refers to that section by the use of the words, “any such mortgage or deed of trust.” Section 4276 refers and has application only to actions and foreclosure of deeds of trusts and mortgages given to secure obligations “after such obligation has been barred by the Statute of Limitations,” and. it is to such mortgages and deeds of trust that section 4277 applies, that is, to deeds of trust and mortgages given to secure obligations that were barred at the time of the passage of the act of 1891.

This act was construed by the Kansas City Court of Appeals in Little v. Reid, 75 Mo. App. l. c. 270. Smith,P, J.,said: “It is obvious from the veryterms of the first section that it does not apply since the present note and mortgage were executed before the act took effect. Nor does the second section [section 4277] have any application, for the plain reason that when the act took effect the plaintiff’s right of action on the note itself was not barred. This is not a case in which when the act took effect, the action was barred on the note but not on the mortgage, so that the two years’ limitation therein prescribed has no sort of application to it. ’ ’

Obviously our worthy brother of the Court of Appeals was of the opinion that the two-year limitation only applies where the note was barred when the act of 1891 took effect, but the mortgage was still in force. In Stanton v. Gibbins, 103 Mo. App. 264, the same learned court, however, uses this language: “But in cases where the mortgage was executed prior to the act it would be barred in two years, if at any time before the two years had run the obligation had become barred.”

We think this extract from Stanton v. Gibbins is in conflict with the view expressed in Little v. Reid, supra. We think it was the purpose of the General Assembly to provide that all deeds of trust and mortgages executed after the act of 1891 (now sections 4276 and 4277, R. S. 1899) should continue in force only so long as the debts they were given to secure were not barred by the Statute of Limitations, and to repeal the right to enforce them for twenty years and after the obligations they secured were barred, as had been repeatedly held before the enactment of 1891. [Lewis v. Schwenn, 93 Mo. 26; Long v. Long, 141 Mo. l. c. 368.] But the Legislature obviously intended this legislation to be prospective in its operation and carefully provided that it should take effect after the passage of the act. It was also in the mind of the Legislature that there were doubtless many deeds of trust and mortgages which had been given to secure debts which were barred by the Statute of Limitations, but which were nevertheless enforceable, and accordingly it was determined to shorten the period of limitations as to such deeds of trust and mortgages' hy providing they should not be foreclosed after the expiration of two years after the passage of the act. We think to apply it to obligations which had been executed prior to the act and which would be barred within two years after the act went into effect, would be to import into the act a contingency for which the Legislature made no provision, and this, of course, we cannot do. If the act is not to be held applicable to those mortgages and deeds of trust only, in which the debts were barred at the time of the passage of the act, then it would result that those mortgages whose debts were barred when the act was passed would have two years in which to foreclose, but a creditor whose debt might be barred only a month or a day even before the two years after the passage of the act of 1891 expired, would only have the fraction of that two years left in which to foreclose. We do not think such a result was in the mind of the Legislature. We think the act was applicable only to those whose debts, secured by mortgages or deeds of trust, were barred when the act was passed.

At any time before the' Statute of Limitations had become a bar to the foreclosure, the General Assembly had the power to shorten or cut down the length of time required by the statute to become a bar thereto, provided always a reasonable length of time was given to parties in' whose favor these rights of foreclosure existed in which to bring their actions. [Cranor v. School District, 151 Mo. 123, 124, and cases cited.] We think the circuit court correctly held that sections 4276 and 4277, Revised Statutes 1899, had no application to the facts of this ease and that plaintiff’s title passed to defendant by virtue of the foreclosure of the deed of trust.

The judgment is affirmed.

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


author: BURGESS, P. J.

text:
    SMITH, Administrator, Appellant, v. PERRY et al., Executors.
    Division Two,
    June 19, 1906.
    1. ACCOUNTING: Sale of Trust Lands: Consideration Recited in Deed. The consideration recited in the deed of lands sold hy a trustee, held for himself and another, is prima-facie the amount with which the trustee should be charged in an adjustment of the trust account between them; and in the absence of evidence that a less sum was-received, or that a part of it went to pay expenses, he should be charged with that sum. And a letter addressed hy the trustee sometime after the sale to the other beneficiary, in which he stated he had received a less sum, but does not explain what was done with the balance, is not sufficient to reduce the amount stated in the deed as the consideration.
    2. -: Setoff: Counterclaim: Mutality: Insolvency: Trustee. Independent personal debts due from a beneficiary to the trustee, being not ‘statutory counter-claims for want of mutality and therefore not to be setoff against the beneficiary’s demands for an accounting of the trust estate as legal demands, may nevertheless he setoff in a proceeding in equity, where the beneficiary is insolvent, and the trustee puts himself in position to invoke the equitable powers of the court.
    3. -: -: - — : -: -: When Equity Will Setoff Demands. Cross demands and counter-claims, whether arising out of the same or wholly disconnected transactions, and whether liquidated or unliquidated, and whether the suit for an accounting is between the trustee and the beneficiary or between their administrators, may be enforced by way of setoff whenever the circumstances are such as to warrant the interference of equity to prevent wrong or injustice.
    4. -: Trustee: Setoff: Equity: Insolvency: Trustee’s Failure to Account. The general rule is that the trustee when called upon to account for the property entrusted to him cannot setoff an independent debt due him from the cestui que trust. And where he fails to render an accounting of his trust he will not be permitted to do so. The insolvency of the cestui que trust is not sufficient in such case to invoke the interference of a court of equity. It is the imperative duty of the trustee to make an accounting of the property entrusted to him before he can avail himself of the doctrine of equitable setoff.

      5. -: -: -: ,-: -: -: How Shown: Book Account. The law does not require a book to be kept by a trustee in which he enters credit to the cestui que trust of his share of the tracts of land held by him for them both. And the fact that the trustee after the sale of a tract of land wrote to the cestui que trust that he had done so, but named the price received to be less than that mentioned in the deed as the consideration, and stated that one half the amount was placed to his credit, and those facts were set up in his answer, but at the trial after his death that book was not offered by his administrator, does not show that he has failed to render an account, since the letter revealed as much to the cestui que trust as the book entry would have done.
    15. -: -: -: -: -: -: -: Other Items. Nor does the fact that the referee finds that the trustee “seems to be indebted on the trust beyond the items reached in the account” authorize a court of equity to refuse to permit the independent personal debts of the cestui que trust to be set-off against his demands against the trustee. Such a finding ought not to preclude equitable setoff, but another reference should be ordered to ascertain what other property belonged to the trust estate.
    Appeal from St. Louis City Circuit Court. — lío». John A. Talty, Judge.
    Reversed and remanded.

      B. D. Kribben, H. K. West and C. B. Crawley for appellant.
    (1) It is tire duty of every trustee, bailee, agent, attorney, factor, or other fiduciary, receiving funds belonging to another, to keep account of his receipts and disbursements, and render true statements to his principal from time to time as such funds come into his hands. 2 Beach on Trustees, pp. 1564-1565; Blauvelt v. Akerman, 24 N. J. Eq. 495; Smith v. Crews, 2 Mo. App. 269; McMahan v. Franklin,' 38 Mo. 549. And when sued by the principal for an accounting the burden is xxpon the fiduciary to show that he has either paid the money over to the principal, or disbursed the same according to the latter’s direction. Young v. Powell, 87 Mo. 128; Hoffman v. Hoffman’s Exr., 126 Mo. 499; Carder v. Primm, 47 Mo. App. 301, 52 Mo. App. 102; Hiel v. Stegner, 56 Mo. App. 535. In the present instance, after twice answering by general denials, repudiating the fiduciary relation, Perry by his last answer admitted the trust, set forth what he claimed to be a complete list of the lands held by him for the joint account of himself and Lewis, affirmed that but one sale had ever been made, and declared that one-half the proceeds of that particular sale had been entered by him to Lewis’s credit “in a book” kept by said Perry. But not only did Perry in his lifetime fail to produce any such book, or file an exhibit of its contents, but his attorneys and executors have been unable to find it since his death. There is no pretense that this money was ever paid over to Lewis, that Lewis ever directed, its application, or that Perry had any lien upon it. 'When to this is added the fact that the deed executed by Perry in that transaction shows $1,050 greater consideration than admitted in his answer ; the further fact that other sales were proved to have been made and the money received by him; and that upon his decease not a single foot of the trust lands in Missouri appears upon the inventory 'of his estate; the conclusion is irresistible that if all the Missouri lands were not disposed of before the filing of his answer, they must certainly have been sold between that date and the time of Perry’s decease. Under such circumstances the book wherein the answer says his account of sales was kept, became of paramount importance. To himself, to his attorneys, to the court, to the widow and administratrix of his deceased friend whose half of $11,450 that voracious book is alleged to have everlastingly swallowed up, Perry owed the duty of producing the book, or filing with one of his several answers a statement of its contents. By so doing he might have made his accounts as clear as day. By failing to do so he has left them enveloped in mystery as impenetrable as a fog at midnight. This suppression of the very proof which he pleads as his defense, justifies the most unfavorable presumptions against him. The reason for the maxim, “in odium spoliatoris omnia praesumuntur” extends as well to concealment as to literal destruction of evidence. Armory v. Delamaire, 1 Stra. 505; 1 Greenl. Ev., sec. 37; State to use v. Porter, 9 Mo. 357; State v. Alexander, 119 Mo. 462; Pomeroy v. Benton, 77 Mo. 64. (2) A derelict agent or trustee who refuses to account for money belonging to his principal cannot plead independent matters of counter claim or setoff in an action brought by his principal for an accounting; because the principal’s right to such accounting is absolute. The relation between them is not that of debtor and creditor, but one of trust. Before an agent or trustee, therefore, may treat himself as a debtor of the principal, so as to obtain the benefit of independent setoffs, he must first state his account and strike a balance. Pratte v. Scott, 19 Mo. 626; Bartels v. Kinneger, 144 Mo. 370 ; Deening Co. v. "Webb, 76 Mo. App. 329. Many authorities hold that under no circumstances should a trustee of an open and continuing trust, when called upon to account, be heard to interpose any matter of counterclaim or setoff unrelated to the trust, even where a full accounting is had. Roso v. Hart, 2 Smith Leading Cases (8 Ed.), part 1, 355; Libby v. Hopkins, 104 TJ. S. 303; Cook County Bank v. United States, 107 U. S. 445; Tagg v. Bowman, 99 Pa. St. 376; Bank v. Barnum Wire Works, 58 Mich. 124; Peters v. Bank, 86 Tenn. 224; Smith v. Hall, 75 N. Y. 48; Scammon v. Kimball, 92 U. S. 362; Abbott v. Foote, 146 Mass. 334. If this is right doctrine in cases where the true state of the fiduciary’s accounts are exhibited or ascertained, how much greater reason is there for applying it where, as here, the trustee conceals his accounts, and obstructs discovery at every step. (3) Another reason why both the $10,000 and $3,300 counter claims should have been rejected is that both were given for partnership debts of Thomson & Lewis, and Perry’s endorsement of the $10,000* note was made for the credit and accommodation of the firm, as distinguished from the individuals composing the firm. Hundley v. Farris, 103 Mo. 78; Level v. Farris, 24 Mo. App. 441.

      Boyle (& Priest and Morton Jour dan for respondents.
    In refusing to allow the offsets, the referee overlooked or disregarded the express provisions of section 4487, Revised Statutes 1899*, which provides: “If any two or more persons are mutually indebted in any manner whatsoever, and one of them commences an action against the other, one debt may be setoff against the other, although such debts are of a different nature.”' Much is said in the points and authorities of the appellant with reference to the failure of Mr. Perry to make an accounting, and this contention is not supported by any of the testimony in this .case. As suggested in our statement, Mr. Perry died within two years after the suit was brought and the executors were unable to find many papers which were supposed to have existed with reference to the transactions which had covered a period of about ten years prior to the bringing of the suit. There was and could have been no intention upon the part of Mr. Perry to withhold any information with reference to the condition of the account between Lewis and him. There was at all times, and is yet a large balance in favor of Mr. Perry’s estate, and this condition began and continued from the first year in which Lewis engaged in the purchase and sale of tobacco with the financial aid and assistance of Mr. Perry, some ten years before the suit was brought.
   BURGESS, P. J.

This is a suit for an accounting, brought August 23, 1894, in the circuit court of the city of St. Louis, by Virginia V. Lewis as administratrix of the estate of James W. Lewis, her deceased husband, against John D. Perry.

Defendants on February 11,1895, filed an amended answer, to which plaintiff filed replication on March 12th next thereafter. John D. Perry having in the meantime died, his death was suggested, and the suit revived against the defendants David R. Francis, Lewis Perry and Richard E. Perry, his executors.

. On February 1, 1896, the cause, upon stipulation between the parties, was referred to Charles W. Bates, a member of the St. Louis Bar, for trial of both the law and the facts, who, on July 21, 1902, after having heard the testimony, made and filed his report as such referee in the circuit court where the cause was then pending. The referee found that the defendants, as executors of the Perry estate, were indebted to plaintiff in the sum of $9,976.31 1-2 and recommended judgment for that sum, with interest at the rate of six per cent per annum from the date of filing suit, and for costs. Within four days after the referee’s report was filed the defendants filed exceptions thereto, assigning various grounds therefor, some of which were sustained as shown by the judgment rendered, which is as follows:

“Now at this day the court having duly considered the defendants ’ exceptions to the referee’s report heretofore filed and submitted herein, doth order that said exceptions be sustained as follows, to-wit: The item $2,500 ($12,500) found against defendants should be $11,450.00, making the total proceeds of sale $18,902.63, one-half of which, $9,451.31, defendants should be charged with. The defendants should be allowed the amount of and given credit for the two notes, one for $10,000 with interest, amounting to $20,249.70, and the other for $3,320, with interest, amounting to $6,142, making a total of $26,391.70, and the same charged against plaintiffs. Deduct from this the $9,451.31, leaves a net balance in defendants’ favor of $16,940.39, for which sum there is judgment in favor of the defendants and-against the plaintiffs.

"It is therefore considered and adjudged by the court that the defendants, Lewis Perry, Richard E. Perry, David R. Francis, as executors of the estate of J. D. Perry, deceased, recover of the estate of James W. Lewis, deceased, in the hands of John F. Lewis, administrator de bonis non of the estate of James W. Lewis, deceased, the said sum of sixteen thousand, nine hundred and forty dollars and thirty-nine cents, together with the costs herein expended, and that the clerk of this court certify to the probate court within and for Howard county, State of Missouri, a copy of this judgment. ’ ’

In due time plaintiff filed motions for new trial and in arrest, which were overruled, and he appeals to this court.

The case is brought before us by the short method, that is, by filing a certified copy of the judgment, order of appeal and abstract of the record.

Defendants challenge the sufficiency of the abstract upon the ground that none of the evidence is contained in or copied into the bill of exceptions as it appears in the abstract, which simply directs the clerk as follows : "Clerk here copy said transcript of the evidence and proceedings before said referee, inserting in their proper place, as indicated in said referee’s transcript, the various documents and exhibits filed by said referee as aforesaid.” But, for the purpose of a full understanding of the issues involved in this appeal, we think the abstract and report of the referee sufficient.

The referee’s report, omitting formal preliminary matters, is as follows:

"This suit was instituted by the administratrix of James W. Lewis, on August 23, 1894, against John D. Perry, then living. The original petition calls for an accounting for sale of lands, the legal title to which bad been in Perry upon a trust alleged to have been begun in 1886, in equal shares for Perry and for Lewis, deceased.
“Perry’s first answer, filed October 8,1894, denies all allegations of the petition, setting up independent offsets. [An amended petition, alleging the same trust, was filed October 23, 1894. The answer thereto filed October 8, 1894, again denies the allegations of the petition and pleads offsets.] On February 11th, 1895, an amended answer to this amended petition was filed. Offsets were pleaded, to be discussed hereafter. The answer admits the trust, gives a list of lands asserted to be a true list and a complete one of the lands covered by the trusts; admits a sale of a definite part of this land for $11,450, and alleges that Perry placed half the proceeds to the credit of said James W. Lewis in a book kept by him, the said defendant, and notified said Lewis of placing the same to his credit. The reply in substance claims more land in the trust, and more sales, admits the sale alleged, but questions the consideration, and denies that Lewis ever received any part thereof. Mr. Perry died in August, 1895, about a year after the institution of the suit. The suit proceeded against his executors. ■
“At the hearing, plaintiff introduced evidence tending to prove the sales by Perry under the trust outside of the admitted sale. In the sale admitted in the answer, consideration' shown by the deed was $12,500. While it is quite possible that the net proceeds were only $11,450, corresponding with the allegation of the amended answer to the amended petition, defendants offered no evidence to account for the difference, nor did they do anything to substantiate the allegations about placing half the proceeds to the credit of James W. Lewis in a book kept by Perry, and notifying Lewis that the same had been placed to his credit. Not only was no account submitted onbehalf of the trustee, but no evidence in tbe case is offered explanatory of tbe sales of the land. Comparing the realty described as belonging to the trust, in the amended answer, with the realty set forth in the inventory of Mr. Perry’s estate, filed in the probate court, there remain tracts unaccounted for, listed in the first paper and not in the second, of which the evidence tells us nothing. On this branch of the case, the trust, the defense limited itself to the introduction of a number of tax receipts, many of which have no color of being credits in a trust account.
“In the foregoing, the status of the defense toward an accounting in the trusteeship is alluded to chiefly for its bearing bn the question whether the defendants are in a position to be heard on the three counter-claims or setoffs (be they in law or equity) which are set forth in their above-mentioned answer, on which the issues are joined.
“That amended answer claims setoffs as follows:
“1. A note of Lewis and of J. S. Thomson to the Laclede Bank for $10,000 at four months, dated May 22,1886, guaranteed by Perry, and taken up by the latter March 9,1892.
“2. A note of Lewis to Perry, dated April 19, 1887, one day after date, for $411.82.
“3. A note of Lewis and the above-mentioned J. S. Thomson, as partners, under the firm name of Thomson & Lewis, to Perry for $3,320', on demand, dated October 10, 1888.
“I make the following finding of facts: Both Thomson and Lewis lived in Glasgow, Missouri, both well to do, and interested in various business matters. For several years they were associated as partners in buying, packing and selling leaf tobacco. The tobacco of any given year comes to the market only during the year following its growth. Shortly after the middle of the succeeding year, say 1884, for the crop of 1883, the tobacco is out of the grower’s hands. So that each year’s purchases are clearly separated from those of other years.
“Thomson and Lewis, as partners, handled the crop of 1883. On December 10, 1884, Thomson and Lewis, calling themselves by the firm name of Thomson, Lewis & Co., formed a partnership with Perry, 'for the purpose alone of buying leaf tobacco at such times and in such place as they may think to their best interest. ’ The crop of 1884 was handled under this partnership agreement, resulting in heavy losses. Thomson and Lewis, in the hope of making good the loss, carried on the business, with the same factories, etc., for the crop of 1885 (doing the purchasing in 1886). It is plaintiff’s contention that Perry continued a partner as to this crop of 1885 ; but under the evidence, I am satisfied, and I find, that Perry was a partner for the crop of 1884 only, and was not a partner as to the crop of 1885. ■
“Perry, however, continued to aid Thomson & Lewis, by endorsing their paper in large amounts. Thomson & Lewis would send their notes to the Laclede Bank, St. Louis, the proceeds being placed to the credit of the Howard County Bank at Glasgow, of which Thomson was president, and in which Lewis held .considerable stock. The Howard County Bank, in turn, placed these proceeds to the credit of Thomson & Lewis, or Thomson, Lewis & Co., as to which names under my views, it is not material to distinguish.
“The Laclede Bank held more or less security, either on the tobacco or on the deeds of trust on property of Lewis and of Thomson. As above stated, they were also largely secured by Perry’s indorsements.
“In September, 1886, all this business went'into liquidation. The Howard County Bank made a conveyance which was judicially declared to be an assignment for the benefit of its creditors. Lewis and Thomson had put mortgages on all of their property under which ultimately all their title was foreclosed.
“It is not necessary, in this case, to make findings as to the ultimate state of balances between the three individuals, the two banks and the firms, one or two, whose accounts have been investigated at the hearing. There is no doubt in my mind as to the heavy indebtedness of Lewis to Perry.
“On October 10, 1888, Thomson, assuming to act on behalf of Lewis and of himself, made a settlement' with Perry in which the liability on the $10,000' note (the first off-set) if Perry should pay it, as he did thereafter, is fully recognized. The note for $3,320, the third off-set, was executed in pursuance of this settlement, I find that Thomson was authorized to make this settlement, and further find that Lewis ratified it after it was made. I find no evidence whereon a credit on either of these amounts could be based.
“Defendants practically concede, and I find that they failed as to their second counter-claim, being a note for $411, dated April, 1887.
“The note of $10,000 originated in the transaction of Thomson & Lewis or Thomson, Lewis & Co., as a firm, while engaged in buying in 1886, the tobacco crop of 1885. Perry was not a partner of that firm, his connection being limited to the firm which bought in 1885 the crop of 1884 as above found.
“The note of $3,320' is an indebtedness of Thomson and Lewis as individuals, to Perry, and is not a partnership obligation.
“One question as to evidence calls for special mention. Mr. Thomson, who was Mr. Lewis’s partner, gave his deposition for defendant, while Mr. Perry was alive, but after Mr. Lewis’s death (for the suit was .brought by Mr. Lewis’s administratrix), his evidence was objected to with sufficient definiteness on all the various subjects as to which he was interrogated. The objection.was based on the claim that he was disqualified by the fact of Mr. Lewis’s death. The objection would have force, had Thomson been offered as a witness for plaintiff, that is, in the interest of Lewis, his deceased partner; hut I think him clearly a competent witness for the other side, as to every issue, save possibly the question whether Perry was a partner of Lewis and of Thomson in the business of 1886, being for the crop of 1885. In finding that Perry was not a partner for that year, I have ignored all evidence given by Thomson in his deposition. In my opinion the evidence, apart from Thomson’s deposition, establishes the fact beyond reasonable doubt.
“As against this $10,000' claim, it is urged as a further defense that defendants held as collateral notes secured by a deed of trust on lands of Thomson and of Lewis dated December 1, 1895, for $30,000, which security should be exhausted before this note for $10,000 is entitled to consideration. On this point I find the facts as follows:
“Thomson and Lewis, under date of December 1, 1895, executed a series of notes for $30,000 to Perry, secured by a deed of trust on all their property in which Wayland was trustee. On the same day, December 1, 1895, Thomson and Lewis executed their notes for $32,000 to Nelson & Noel, secured by deed of trust to Mr. Perry as trustee, on the same property described in the last-mentioned deed of trust. Both of these deeds of trust were given for the same purpose, that is, to secure the Laclede Bank, as also Mr. Perry, on the liabilities of Thomson and of Lewis, and of the firm of Thomson, Lewis & Company, to them. The Nelson & Noel notes seem to have been based on a hope that cash could be raised on them, a hope which was not realized. It is clear to me that these two series of notes were issued for the same purpose; that they both came into the hands of the Laclede Bank; and that sale was made under the Nelson & Noel deed of trust, the proceeds being properly applied pro tanto to the satisfaction of the claims for which this collateral was given.
“Plaintiff urges that these deeds of trust are independent of each other; that the deed of trust in which Wayland was trustee was first delivered; that the property when sold was sold under this deed of trust, and that the property is therefore still subject to the first deed of trust, and that the collateral as to the $10,000 note in suit has not been exhausted.
‘ ‘ The answer is, that it is immaterial to determine which of these deeds of trust was first delivered. There was no intention to create two deeds of trust. The foreclosure under the Nelson & Noel deed sold out all the rights of Thomson and of Lewis in the property. After such sale under one deed of trust neither the bank nor Perry (and no one else who held this set of collateral notes under which the sale was not made), could claim any further right under the other deed of trust.
“This view is strikingly illustrated by the decision of the circuit court of Howard'county at its November term, 1890, before the sale under deed of trust, in a suit wherein the assignee of the Howard County Bank is plaintiff, and the Laclede Bank, Perry, Thomson and Lewis, are defendants; the decree finds the Nelson & Noel deed of trust to be a first lien on the premises. Sale under that deed of trust followed.
“In my opinion, the other deed of trust, in which Wayland is trustee, securing notes to the amount of $30,000 to Perry, is functus officio. There is, therefore, no security to be exhausted before defendants make their claim on the $10,000, which is the subject of the first off-set.
“Prom the foregoing it results that I find that Perry at Lewis’s death had a valid claim against him for $10,000 on the first counterclaim; and also had a valid claim against him under the note described in the third counterclaim of $3,320. I have made these findings, the evidence as to which, often remotely bearing on the issue, occupies much of this voluminous record, so that in case I err in my views next to he expressed as to the admissibility of these off-sets claimed by defendants, all material necessary to a final determination of the cause may be before the court.
‘ ‘ This brings us to the most troublesome question in the case. Should defendant’s off-sets be considered in this case?
“That defendant’s causes of action are not statutory counter-claims is clear. They would not be so if Lewis in person were plaintiff. The claim of Perry against Lewis is individual whereas Perry’s obligation is in his character as trustee. Mutality is lacking. [Tagg to use v. Bowman, 99 Pa. St. 379.]
“But defendant’s claim, while not good in law, may still be entitled to recognition as an off-set in equity. Cross demands and counter-claims whether arising out of the same, or wholly disconnected transactions, and whether liquidated or unliquidated, may be enforced by way of off-set wherever the circumstances are such as to warrant the interference of equity to prevent wrong and injustice. [North Chicago Rolling Mill v. St. Louis Ore & Steel Company, 152 U. S. 596-615.]
“As is said in Kentucky Flour Co. v. Merchants’ National Bank, 90 Ky. 226: ‘ Courts of equity in this State applied the doctrine of equitable set-off prior to the existence of our statute. It was found to be necessary to complete justice in cases where some fact existed impairing the efficacy of the legal remedy.’ See, also, Elliott v. Pool, 6 Jones Eq. 45. ‘The insolvency of the party against whom the off-set is claimed, is distinct ground for entertaining it.’ [St. Paul Trust Co. v. Leck, 57 Minn. 87, 47 Am. St. Rep. 576, where there is a valuable note.]
“Plaintiff urges that injustice would be done to other creditors of Lewis’s insolvent estate, by allowing the Perry estate to establish its counter-claims and thus virtually collect the claim in full, whereas other creditors would only receive a dividend, but tbe better reasoning seems to be that no injustice is done other creditors by allowing the adjustment of all accounts as they stood at the death, assignment or bankruptcy of the insolvent. [See 57 Minn, supra; Aldrich v. Campbell, 4 Gray 284; Receivers v. Gas Light Co., 23 N. J. Law 283.]
“Such I think, is the law of Missouri. In Smith v. Spengler, 83 Mo. 412, the court quotes approvingly from Darby v. Freedman’s Co., 3 McArthur 349:, as follows: ‘It is now well established that when the assignees or personal representatives of a bankrupt or insolvent are plaintiffs or defendants, the right of set-off will extend to all demands that could be proved by or against the estate, without regard to the period when they became due, or the person in whom the right of action is nominally vested.’ See, also, Morrow’s Assignees v. Bright, 20 Mo. 298; Green v. Conrad, 114 Mo. 664.
“It seems to me defendants have the same right to off-set which they would have if Lewis, in person, had brought the suit.
“But these off-sets are claimed on behalf of a trustee, who is called on to render an account of his trust. The doctrine is laid down in 22 Am. and Eng. Ency. Law (1 Ed.), 311, Tit. ‘Set-offs,’ as follows: ‘The trustee, when called upon to account for the property entrusted to him, cannot set off an independent debt due him from the cestui que trust ’ [Bank v. Barnum Wire Works, 58 Mich. 124, 55 Am. Rep. 660; Peters v. Bank, 86 Tenn. (2 Pickle) 224; Scammon v. Kimball, 92 U. S. 362; Libby v. Hopkins, 104 U. S. 308; Cook County Bank v. U. S., 107 U. S. 445; Abbott v. Foote, 146 Mass. 334.]
“But this general proposition must be-subject to exceptions. The fact is recognized in First Bank v. Barnum and in Abbott v. Foote, supra.
“If this were a case of accurate rendering of accounts by a trustee, leaving no doubt as to the precise amount due under the trust, giving full information as to the trust estate not disposed of and demonstrating a proper administration, it seems to me equity would require, in view of the insolvency of the cestui que trust, the offset of any clearly-established debt of the cestui que trust, existing prior to the death of the cestui que trust.
“But as is said in Armstrong v. McKelvey, 104 N. Y. 179 (loc. cit. 185) the power of allowing equitable offset ‘should be very cautiously exerted, and only in a case when the equity involved is entirely clear and certain. It is never justified save when other remedies are impossible and where the allowed demand is put beyond reasonable doubt.’
“In the case before us the equity is neither clear nor .certain. It is impossible to state a full account; and impossible to say with certainty that upon a full statement, defendants would be entitled to the full allowance of the two off-sets under discussion. As long as the trust account is in such condition, I think it inequitable to entertain off-sets.
“It was the imperative duty of defendants to render an account of the trust. That they have wholly failed, is set forth in the beginning of this report, and appears again hereafter in the accounting. No explanation is offered. The death of Perry is not adequate cause, for it occurred about a year after the suit was filed. After first denying the trust, defendants admit it, through counsel giving a list of land as involved, but purporting to account only for one sale; making no statement whatever as to the other lands, much of which we infer from the evidence was sold in Mr. Perry’s lifetime. The deed of the tract admittedly sold calls for a greater consideration than that set forth in the answer, and there is not a particle of evidence to substantiate the pleaded entry of a credit in a book.
“The life-long mutual friendship, confidence and regard between Lewis and Perry, the fact that no evidence is adduced that Lewis, a debtor to Perry on other accounts, ever called for a full account of the trust; the personal integrity of both parties as developed in the record; all this tends to make the court receptive of any reasonable explanation of Perry’s failure to render an account.
“But the court cannot indulge in surmises. No explanation is offered, and defendants stand without having rendered any account, liable on a number of items under evidence brought out by plaintiff, and unexplained; with the impossibility of stating the true account of the trust, at least upon the record; and with a practical demonstration, at least as far as the record goes, that Perry took property under this trust, still unaccounted for, and of which no account can be taken in this case.
“If allowance of off-sets in this case be not a matter of legal right, but of equitable discretion, it seems plain that such discretion should.not be exercised in favor of the estate of a trustee who has failed to account, who seems to be indebted on the trust beyond the items reached in this account.
“As to the $10,000 note, there is an additional reason for its rejection as an offset. While the note itself is signed by Thomson and by Lewis, individually, it originated in an accommodation endorsement by Perry for the partnership of the firm of Thomson & Lewis, engaged in 1886 in buying the tobacco crop of 1885. In settling Lewis’s estate, I think this note should be looked on (going behind its mere form) as a partnership obligation.
“None of the three set-offs pleaded by defendants should be allowed in this suit.
“The accounting under the trust:
“1. The plaintiff put in evidence a deed from Perry to Richardson et ah, dated June 16, 1890, conveying for the named consideration of $12,500' certain lands in Jefferson county, Missouri. Some of the lands are conveyed by the deed under the description given in the answer; of other lands described in the answer, an undivided one-half only is conveyed. It would seem that the deed includes lands not mentioned in the answer.
“2. The deed of Perry to Mercer conveyed property in Jefferson county-, in the trust according to the answer, for $640, on April 12, 1890.
“3. The deed of Perry to Bradford conveyed property in Jefferson county, in the trust according to the answer, for $640, on December 20’, 1888.
“4. In a letter of November 17,1890', Perry writes to Lewis: ‘There is still unsold of the Brockogle tract, which was a part of the property, 420 acres, worth about $5,000; I hope to get something over that. I sold off of that tract, two or three years ago, two 80-acre tracts for $8 per acre. Most of the payment has been made. ’
“From the manner in which this .communication is made, it may be fairly assumed that this property comes under the trust. Nothing indentified the Brock-ogle tract. I find nothing in the date or price to identify the sale referred to in this letter, with any of the sales covered by the three deeds above mentioned. The two 80-acre tracts at $8 per acre, make $1,280'.
“5. On March 18, 1892, Perry writes in a letter to Lewis, “A- few days ago I sold the balance of the Brockogle farm at Vineland for $5,000. There are 400 acres. I sold it payable for $500 per year, taking 10 years to pay, with interest at 7 per cent, which is to the credit of our joint account for the amount $5,000.
“These are all the sales as shown.
“From the lack of description of the sales of the last two tracts, it is not possible to say whether all the Jefferson county lands mentioned in the answer are accounted for.
“Lands in Tazewell county, Illinois, are mentioned in Mr. Perry’s inventory, substantially agreeing with lands described in tbe answer.
“Nothing appears as to tbe tracts in Dent and Phelps counties, Missouri.
“It seems probable that Mr. Perry refers to tbe price realized by tbe sale to Richardson, in bis letter of November 17, 1890, referred to under 4 above. In this letter be says: ‘I have your letter of tbe 15th. If you will examine my letters, you will see that my figure is $11,450 just as it is here (except a dot) could not be made to mean $114.50, as you have stated it in figures, and could mean nothing if it did not mean $11,450. Tou also say this is tbe first time you have beard anything about tbe sale and again you say you suppose you would have let me know of it. Now, I believe I have not written you since tbe sale, about that or anything else, except tbe letter of 30 October, informing you in tbe letter of tbe cause why I did not write to you tbe time tbe sale was consummated, to-wit: I left for Colorado about tbe time of tbe sale, much complaining, and remained three months, and was much engaged after returning until I wrote you. ’
“If this is understood to say that tbe net purchase price was $11,450 instead of $12,500' as stated in tbe deed, it fails to explain why it is so. Taking tbe statement for whatever it is worth, I think it falls short of tbe explanation which tbe trustee owes, and does not overcome tbe prima-facie case made out by tbe recital of tbe consideration of tbe deed.
“Defendants offered no further account, save that they introduced over 40 tax receipts, without any explanatory evidence.
“Two of these receipts are strangers to tbe record. A number are to Lewis and Perry, some are for lands in Kansas, in Howard county, Missouri, and in Linn county, Missouri. No such lands are mentioned in tbe answer or otherwise appear to be involved in tbe trust. The trust is alleged in the petition to have begun in 1886. There is no claim of an earlier beginning, nor any evidence indicating it, I therefore have considered the tax receipts prior to 1886 irrelevant. Four tax receipts to Perry for 1888 and subsequent years as to the trust lands in Phelps county are shown. But as these lands admittedly belonging to the trust are unaccounted for, not even appearing in the inventory of Mr. Perry’s estate, it seems under every aspect that no credit should be allowed on account of such tax bills here.
“Three amounts for taxes of 1887, for which defendants produce receipts to Perry, I think proper-credits, since it may be reasonably inferred that the Jefferson county lands therein referred to are those which were sold, as above found. These tax bills are for $23.41, $17.35 and $66.61 respectively; they aggregate $107.37.
“In view of the fact that Perry must have had expenses such as taxes, expense of sale, etc., for which he obtains no credit here, in view of the failure of Lewis, as far as the record shows, to demand an account, and in view of the fact that Lewis, as found in this report, was Perry’s debtor during all this while in a large amount, which is not allowed here, I do not deem it just to charge Perry with interest prior to the institution of this suit.
“I-find that Perry sold trust property as follows:
1. To Chesnut & Richardson........$12.500.00
2. To Mercer.................... 640.00
3. To Bradford.................. 640.00
4. The two 80-acre tracts in letter of Nov. 17, 1890 ..........■...... 1,280.00
5. The Brockerson tract............ 5,000.00
$20,060.00
From which deduct paid taxes...... 107.37
Leaves the proceeds of sales........$19,952.63
“For half of which, $9,976.36, I find the defendants liable to plaintiff.
“I recommend a judgment for that sum, with interest at the rate of six per cent per annum from the date of filing suit, and for costs.”

The exceptions to the referee’s report were sustained and judgment rendered for defendants, upon the ground that the Perry estate should only have been charged with $11,450 realized from the sale by him of partnership lands, instead of $12,500, with which he is charged by the referee, and the disallowance by him of the note for $10,000, held by Perry against Thomson & Lewis or Thomson, Lewis & Go., and of the note for $3,320, held by Perry against Thomson and Lewis as individuals, both of which notes were produced by defendants as offsets against plaintiff’s claims.

With respect to the first proposition, it is recited in the deed that the consideration for the land thereby conveyed was $12,500', which was prima-facie evidence that such was the consideration, and in the absence of evidence that a less sum was the purchase price received by Perry for said land, he was properly charged by the reference with that amount and interest thereon. It is true that by letter of Perry to James W. Lewis, of date November 17, 1890', he stated to Lewis that he had sold the land for $11,450, but this statement was doubtlessly made by mistake through lapse of memory, and did not overcome the recital in the deed as to the price received for the land.

As to the second proposition, the referee foundthat the notes for $10,000 and $3,320 were valid claims in favor of Perry against Lewis at the time of the latter’s death, but they were not statutory counter-claims in favor of Perry against Lewis as an individual, whereas Perry’s obligation to Lewis is in his capacity as trustee, and mutuality is, therefore, wanting. But it does not necessarily follow that because defendants’ claims could not be pleaded as setoffs under the statute they cannot be pleaded as set-offs in a proceeding in equity, the right to do so depending upon the circumstances, among which is the insolvency of the party against whom the set-off is claimed, this being a distinct ground for entertaining it. [St. Paul & M. Trust Co. v. Leck, 57 Minn. 87.] In Rolling Mill Company v. Ore & Steel Company, supra, it is said: “Cross demands and counter-claims, whether arising out of the same or wholly disconnected transactions, and whether liquidated or unliquidated, may be enforced by way of set-off whenever the circumstances are such as to warrant the interference of equity to prevent wrong and injustice.”

While the referee held that the defendants have the same rights to off-set the claim of Lewis against Perry’s estate as they had against him personally, he also held that the offsets in question could not be considered because they are claimed on behalf of a trustee who is called upon to render an accounting of his trust and has failed to do so. The general rule is that “the trustee when called upon to account for the property intrusted to him cannot set off an independent debt due him from the cestui que trust.” [25 Am. and Eng. Ency. Law (2 Ed.), 533; Bank v. Barnum Wire Works, supra; Peters v. Bank, 86 Tenn. 224; Scammon v. Kim-ball, supra; Cook County Bank v. U. S., supra; Abbott v. Foote, supra.] To this general rule, however, there may be exceptions, as intimated in Abbott v. Foote, supra, wherein it is said: “As is stated in Spaulding v. Backus, 122 Mass. 553, ‘In the matter of setoff, courts of equity follow the courts of law, except where there is some equitable ground, growing out of the transaction or the relation of the parties, which brings the case within the general jurisdiction of a court of equity, and justifies granting relief beyond the rule of law. The existence of cross demands is not a sufficient ground for interference; the party seeking the benefit of the setoff must show some peculiar equity which entitles Mm to be protected against bis adversary’s demand.’ ” [Peters v. Bank, supra.] It is, however, said in Armstrong v. McKelvey, 104 N. Y. 179, that the allowance of an equitable offset, to reduce a demand in suit of an item which cannot be allowed as a legal offset or counter-claim, is only proper “when the equity invoked is entirely clear and certain, . . . when other remedies are impossible, and when the demand allowed is put beyond reasonable doubt.” It is conceded by counsel for plamtiff in their reply brief that the doctrine of equitable setoff may be invoked in favor of an agent or trustee when he comes to settle his accounts, and that the insolvency of the principal may of itself entitle such agent or trustee to a setoff in equity when he has accounted for the° money of his principal. But plaintiff insists, and the referee so held, that it was the imperative duty of defendants to make such accounting in order to avail themselves of the doctrine of equitable setoff. In support of this position both plaintiff and the referee lay much stress upon the fact thatwhile the trustee, in his amended answer, admits the sale of certain partnership lands in Jefferson county, Missouri, to Chestnut & Richardson for the sum of eleven thousand four hundred and fifty dollars, the deed by him to them for said lands recites twelve thousand five hundred dollars as the consideration received; but the answer also alleges that, upon receiving said consideration, the trustee notified Lewis of the said sale and placed one-half the proceeds thereof — five thousand seven hundred and twenty-five dollars — to the credit of said Lewis in a book kept by Perry, and notified said Lewis of the placing of the same to his credit, when in fact defendants produced no book showing such entry. But the failure of defendants to produce such a book as indicated is of little significance when considered in connection with the letter by Perry to Lewis, of dap November 17, 1890, wherein he informs Lewis of the sale to Chestnut & Richardson for $11,450.00, and states:

‘ ‘ There is still unsold of the Brockogle tract which was a part of the property 420 acres, worth about $5,000. I hope to get something over that. I sold off of that tract 2 or 3 years ago 2 80-acre tracts for $8 per acre, most of the payments have been made.
“You do not answer any part of my letter about the importance of getting together with Thomson and yourself to meet me here, go over our whole matters and come to a business determination what is best to be done. There is no longer any advantage in delays. The tobacco is simply eating itself up in charges. Interest is doing the same.
“We may be able to compromise some of our matters. Nothing can be lost in an effort. I can get Thomson, I have no doubt, to meet us. Write me what you think about the matter. All will feel better when we have consulted and determined upon the best course.”

This letter imparted to Lewis information as to the sale, and is as much as could be expected from a book entry with respect thereto. The law does not require a book to be kept by a trustee under the circumstances disclosed by the record in this case, but that correct business methods require it to be done may be conceded. The discrepancy in the amount of the consideration received for the said land, as recited in the deed, and stated in said letter, and alleged in the answer of Perry, may be accounted for as an oversight or lapse of memory on the part of Perry, he not having the deed before him at the time of writing said letter or of making said answer. The amended answer was filed on February 11, 1895, and Perry died in August, 1895, about six months after the filing of said amended answer. With these facts considered in connection with Lewis’s insolvency and Perry’s letter to Lewis, in which he calls the latter’s attention to the importance of the coming together of Thomson, Lewis and himself for the purpose of going over their whole matters and compromising or settling them in some way, and in which he manifests no disposition whatever to' delay settlement of their affairs, we are of the opinion that the referee, in the absence of evidence of fraud on the part of the trustee, was not justified in disallowing said set-offs upon the ground of the failure of Perry to make such an accounting as seemed to be thought necessary by the referee. Perry was entitled to have Lewis pay his debts to him as was Lewis to have Perry account to him for his half of the proceeds arising from the sale of the partnership lands, and it would be inequitable to disallow the one and allow the other.

Perry in his answer admits his trusteeship, and describes all the lands held by him as trustee for Lewis, as well also as the different tracts sold by him, giving the name of the persons to whom sold, and alleging that the lands described- in the answer are all the lands which were held by him in which said Lewis, in his lifetime, had an interest, and that title to an undivided half interest in lands unsold was held by him as trustee for said Lewis. The referee, however, found that Perry sold other lands belonging to the trust estate for which he received $2,560, one-half of which belonged to Lewis, and for which the trustee had not accounted.

If, as held by the referee, the defendants stand, without having rendered any account, liable on a number of items under evidence brought out by plaintiff, and unexplained, and that Perry, under this trust, took property still unaccounted for, and of which no account can be taken in this case, it devolved upon the referee to ascertain, approximately at least, the amount of Perry’s indebtedness to plaintiff, if, as he says, Perry seems to be indebted on the trust beyond the items reached in the account. The trust pertained exclusively to lands, and it does seem to us that it would be no very difficult matter, by examination of the records of the different counties in which the lands lie, to ascertain what disposition Perry made of them, if any, and the consideration received therefor.

At the time of the judgment the amount found to be due defendants upon the offsets was $20,249.70, and it will not do to say, .under the evidence as it appears from the report of the referee, “that Perry seems to be indebted on the trust beyond the items reached in the account,” but the amount of such indebtedness should be stated; otherwise, how are the defendants to know with what specific amounts Perry’s estate is charged? ' .

The judgment we think clearly erroneous as to the first item in the summing up of the referee’s report, to-wit, the $12,500 received by Perry for the land sold to Chestnut & Richardson, and with which amount Perry’s estate was properly charged by the referee. That error could, however, be corrected here. The judgment is correct, we think, in allowing Perry’s offsets, but as the referee finds that Perry “seems tó be indebted on the trust beyond the items’reached in the account,” another reference should be ordered and an account taken, so that the amount thus due to Lewis’s estate may be ascertained, if possible.

The judgment is reversed and the cause remanded, to be proceeded with as herein indicated.

All concur.


author: FOX, J.

text:
    CAMPBELL v. GREER, Appellant.
    Division Two,
    June 19, 1906.
    1. APPEAL: Lost Pleadings. The abstract contains neither the petition, answer, nor reply, and counsel on both sides concede that they are lost or destroyed, and no point is made by reason of their absence, but no attempt has been made to supply them in the way the statute provides. FeZd, that the court can not entertain the appeal, although counsel agree they were in due form, but will order the trial court to supply the lost records, and to permit appellant to perfect his appeal.

      2. -: -: Basis of Judgment: Power to Supply. The foundation upon which, a judgment rests in the trial court and in the appellate court on appeal, is 'the pleadings, and if they are lost the trial court alone can supply them, either because of the power conferred on it by statute, or independent of the statute because of its inherent power.
    Appeal from New Madrid Circuit Court. — No». Henry C. Riley, Judge.
    Appellant ordered to supply pleadings.

      Russell & Heal for appellant.

      L. W. Fisher and J. V. Conran for respondent.
   FOX, J.

This cause is here upon appeal by defendant from a judgment in favor of the plaintiff in the New Madrid Circuit Court.

The abstract of record in this cause properly preserves the evidence, instructions given and refused,sufficiently designates the rendition of the decree and judgment, affidavit for an appeal and the order granting the same, and the signing and filing of the bill of exceptions; but there is a fatal omission in the abstract, that is, the petition, answer and reply are nowhere to be found in it. It is true, it appears from the abstract and briefs of counsel on both sides that the original petition and other pleadings have been lost, misplaced, or destroyed, and there is no point made by reason of the absence of them; but this cannot remedy the defects in this abstract. The pleadings constitute the basis of the judgment, and its force and vitality must rest upon such pleadings. The mere fact that counsel concede that the pleadings were in correct form cannot be made the basis of action of this court.

While rule 13 of this court substantially provides that where there is no point made on the pleadings it. will be sufficient for the abstract to embrace the substance of such pleadings, yet this rule by no means contemplates that where the record discloses that there are no pleadings in existence upon which to base the judgment, and that they have been lost or destroyed, counsel may concede that they are in proper form and request the court to proceed with its judgment without supplying such pleadings.

Legal proceedings affecting the title to real estate should in all things be regular, and we are unwilling to consent to the precedent that parties may agree upon the state of the pleadings and require this court to base its action, either in affirming or reversing the judgment, upon such agreement. The abstract of the record should at least contain the pleadings, which is the foundation upon which the judgment of the trial court, as well as of this court, must be predicated. If the pleadings are lost, misplaced or destroyed, this being a civil proceeding, section 4560, Revised Statutes 1899, furnishes the remedy for supplying them, and the agreement of counsel can by no means take the place of the regular method pointed out for supplying lost records. So far as this case is concerned, it is but little trouble to supply the pleadings; let the statement as provided by section 4560 be filed and from so much of the record as is properly here both parties seem willing that the pleadings be supplied; they can then waive the issuance of process provided by the statute, enter their appearance and consent to judgment supplying the record. From the record as supplied appellant can then make his abstract, in which he can embrace such supplied pleadings. The circuit court of New Madrid county where this case was tried, is the only court having power to supply the lost or destroyed record. Independent of the provsions of the statute, the court has the power to supply lost or destroyed records. The power is inherent in the court to control its own record and supply any losses occuring in that respect. [State v. Simpson, 67 Mo. 647; George v. Middough, 62 Mo. 549; Strain v. Murphy, 49 Mo. 337; Keen v. Jordan, 13 Fla. 327.]

The circuit court of New Madrid county must supply these lost or destroyed records, which must furnish the basis of the judgment in this cause. If we are to act, in the absence of any pleadings, simply upon the suggestions of counsel that the pleadings are in regular form, it would furnish a precedent in many other cases for counsel to simply agree that the pleadings are all right, all this court is asked to do is to settle other legal propositions involved; this we are unwilling to do, on the ground that this court should have before it the foundation of the proceeding upon which to predicate its judgment. The judgment is here and the order granting the appeal; we at least have sufficient"jurisdiction of this cause to suggest the defects in the record, and the order that appellant, if he desires to further prosecute this appeal, proceed in the circuit court of New Madrid county to supply such pleadings as provided by law, and then file in this court an amended abstract embracing such supplied record, or if there is no point made upon such supplied pleadings, state the substance of them, and such order is accordingly made.

All concur.