Cox v. Schnerr

Plaintiff sued to quiet title to certain property in Nevada County. Defendant filed an answer and a cross-complaint and the latter was answered by plaintiff as cross-defendant. A trial was had upon the issues joined, the cause having been transferred for convenience of witnesses to Sacramento County. Judgment was given in favor of the defendant and cross-complainant. Plaintiff appeals from the judgment, and from an order denying his motion for a new trial.

The plaintiff’s alleged title was based upon an instrument which was in form a deed. This writing was dated March 5,

In his answer to the cross-complaint the plaintiff and cross-defendant set forth the deed from Miss Carpenter" to himself as grantee in haec verba, and it is now the contention of his counsel that by failure to file an affidavit as required by section 448 of the Code of Civil Procedure, the execution and delivery of the deed were admitted by the cross-complainant. In support of this position Sloan v. Diggins, 49 Cal. 40 ; Rosenthal v. Merced Bank, 110 Cal. 200 , [ 42 Pac. 640 ]; Knight v. Whitmore, 125 Cal. 200 , [ 57 Pac. 891 ], and Carpenter v. Shinners, 108 Cal. 362 , [ 41 Pac. 473 ], are cited. There is no merit in appellant’s point, and the cited authorities do not support his claim. The main purpose of the answer and the cross-complaint was to discredit the deed upon which rested plaintiff’s claim of title. These pleadings were verified, and although the deed was not fully set out in either of them, it was amply identified as the instrument which, according to the allegations of these pleadings, was void because of the fraudulent conduct of the plaintiff in procuring it. In both the defendant’s answer and the cross-complaint the deed was identified by the recitals of the names of the parties thereto, its date, and the volume and page of its recordation. In the verified pleadings the due execution and delivery of this document were stoutly denied. It would have been a vain and useless exaction, therefore, to have required further denial of the effect of this writing 'by defendant and cross-complainant merely because a copy of the instrument had been set out in the answer to the cross-complaint.

Appellant’s counsel call attention to the fact that the deed of March 5, 1906, was, as found by the court, signed by Miss Carpenter and placed in the hands of plaintiff. These facts, they say, establish execution and delivery as there can be no conditional delivery of such an instrument to the grantee himself. (Civ. Code, sec. 1056; Devlin on Deeds, 3d ed., sec. 314.) But the question of conditional delivery is not in this case. The very basis of defendant’s case is the fraud of the plaintiff in procuring the' deed. If it were fraudulently obtained the mere manual tradition of it could not be in legal sense a delivery. Execution and delivery of such an instrument depend upon more than the mechanical acts of signing it and passing it to another person. Apparent consent is not real or free when obtained through fraud, undue influence, or mistake. Free consent is an indispensable element in the making of a valid contract.

The testimony of the plaintiff himself was to the effect that shortly after Mr. Carpenter’s death he went to the ranch where Miss Carpenter was living. He fixed the date as March 5, 1906, because of the death of one of his friends and a mission which he undertook on account thereof. Miss Carpenter rode into Folsom with him, and during the journey a conversation between them took place. After referring to the sudden deaths .of her father, mother, and brother, Miss Carpenter, according to plaintiff, said she wanted to arrange her 'business affairs. He testified with reference to this conversation in part as follows: “I asked her how she wanted to fix it; she said ‘by deed’; I says ‘I don’t mean that, Annie, I mean how do you wish to dispose of it’; ‘well,’ she said, ‘I don’t care anything about most of my relations,’ she says ‘the Long family, ma’s brother’s family, we haven’t been friends for a great many years,’ she says ‘we haven’t spoken to probably for twenty years,’ she says ‘pa has got a couple of brothers in the East, I never met but one of them, he was out on the ranch a while, but we did not like him, ma made him get off it,’ she says ‘you have been as .kind to me as a brother, I am going tc give you some land’; I says ‘you are— what are you going to give me, the McNamee Ranch?’ She

“By Hughey and his brother she referred to the McGuire boys.” After their arrival at Folsom, according to Cox, they discovered Mr. Carpenter’s will in an old wallet which had been previously taken to Cox’s office. At Miss Carpenter’s request (as Cox testified) he prepared the deeds of certain property to the McGuires, and also the one in which his name appeared as grantee. He then called in Leonard, a justice of the peace, who took her acknowledgments. Cox’s account of the occurrences when Leonard came into the room was as follows: “I said, ‘Annie wants you to take her signature or acknowledgment,’ when he came in the office: Annie said ‘Yes, Johnnie, I am deeding the Twin Valleys to Jay, and the rest of the property to Hughey and his brother.’ ” The deeds were then put into two envelopes, the McGuire deeds in one and the deed to Cox in the other. These were held for a few moments by Miss Carpenter, according to Cox’s account, and then she said: “ ‘Well, I will give you these deeds now, Jay, you understand you are not to record them until after my death, I want the use of this property while I live.’ ” To which he replied “Certainly that is understood.” Upon cross-examination Cox repeated the narrative of the transaction with a fidelity to detail which argued either an excellent memory or a committed story. The justice of the peace corroborated the plaintiff with reference to Miss Carpenter’s remark to him when he was about to take her acknowledgment to the deed. His version of the passing of the deeds, and the conversation at that .time, corresponded exactly with the plaintiff’s.

Alene Hamlin called by plaintiff testified that Mrs. Sehnerr in the presence of the latter’s husband, and Mrs. Burns, told Avitness about deeds which she had made in favor of Cox and the McGuire boys.

Emma P. Wells testified to a similar conversation with Miss Carpenter a week or two after her father’s death, as did Albert D. Scott, who went to work on the Carpenter ranch shortly

The finding that plaintiff was the trusted friend and confidential adviser of Miss Carpenter at the time the deed was drafted and signed is supported by the evidence. It is true that proof of mere friendship is not sufficient to establish the sort of confidential relation which forces the donee of a valuable property to treat with his donor in such a way as to preclude all possibility of undue influence. But in this case plaintiff himself furnished proof of the utmost trust and confidence reposed in him by Miss Carpenter. He was the first adviser summoned and consulted after her father’s death. To him had been intrusted all of Mr. Carpenter’s papers, and she had instructed him to employ learned counsel to assist him in taking charge of the administration of her father’s estate. She called him her “best friend.” Long prior to the death of her father, and her brother William, she had consulted Cox, and he had drawn for her deeds of her property in favor of her brother to be delivered in case she should die before William Carpenter, Jr. These and many other circumstances, which we need not detail, showed the existence of unbounded trust, which made it incumbent upon plaintiff to use the utmost good faith in dealing with her. The court was fully justified, in view of the evidence, in holding that his course, under the circumstances, was eloquent of fraud. The burden of proof usually rests upon the person asserting fraud, but when one bases a claim upon a contract obtained from a person to whom he stands in a relation of trust and confidence, it becomes his task to prove that he exhibited that uberrima fides which removes all doubt respecting the fairness of the contract. And this rule does not apply merely to those who bear a formal relation of trust to those with whom they deal —not only to attorneys, physicians, trustees, clergymen, kinsmen, and others who by the very force of their occupations or relationship are presumed to be in the class of persons bound to act with the utmost good faith. It applies in every case “where there has been a confidence reposed which invests the person trusted with an advantage in treating with the person so confiding.” (2 Jones on Evidence, ed. of 1913, see. 190.)

In every transaction of this kind, one who holds such con

“Q. You have asked for distribution here of this entire estate to Mrs. Schnerr. Do you .know of any transfer or conveyance she has made of her property 1

“A. I do not know it is transferred, only it is of record. I know some papers I prepared for her, not associated in the estate at all.

“Q. It relates to her interest in the estate?

“A. It pertains to her land interest.

“Q. What is that paper?

“A. A paper from Mrs. Schnerr to Mr. Schnerr.

“Q. Anything else ?

“A. No.”

All through the hearing Cox protested that the only papers Mrs. Schnerr had signed were those relating to the conduct of the affairs of the estate. This is so utterly at variance with his testimony in the ease at bar, that the chancellor was justified in casting out any part or all of the later version of the transaction which gave rise to the deeds.

But laying aside the question of fraud, there was abundant evidence to justify the court’s conclusion that both the plaintiff and Miss Carpenter regarded the so-called deed, not as a transfer of present title, but an attempted testamentary disposition of the land. The plaintiff testified that on April 17, 1906, he had a conversation with Mrs. Schnerr at her house. She said: “Jay, I have got a husband now and I want to change those McGuire deeds in favor of Ed.” (Mr. Schnerr, defendant in this action.) He gave her the deeds and never saw them again. These deeds, naming her cousins as grantees, were given to him, according to his testimony, under exactly the same circumstances as those attending the tradition of the deed here in dispute, yet he seems to have surrendered them without question of her right thus summarily to recall them. All of the deeds were made, as he said, at a time

Plaintiff testified that at the time Mrs. Schnerr took back the McGuire deeds he said to her: “You ought to tell your husband about my deed, Annie. ’ ’ To which, after declaring that her husband had nothing to do with the property which she inherited from her father, and commenting upon Mr. Sclinerr’s wish to take the administration of the Carpenter estate from Cox, she responded: “I want you to keep the deed and go right along with my business as though I was not married.” This conversation and the alleged statements of Mrs. Schnerr regarding the deed which other witnesses related are deemed by appellant to be ample proof of the laches of Mrs. Schnerr, who, as his counsel say, knew?all about the deed and its provisions, yet took no steps to have it declared void. But we may not pass upon the weight of this evidence, nor question the power of the court to find that the alleged grantor never acquiesced in, nor affirmed the deed, nor admitted directly or indirectly that plaintiff had any interest in the property. Under the circumstances which we have discussed heretofore, the court trying the issues may have disregarded this testimony entirely, depending upon the presumption of fraud and plaintiff’s statements under oath in the probate proceeding when Mrs. Schnerr was present, rather than his later version of his transactions with her touching this property.

Appellant apparently places great faith in subdivision 4 of section 338 of the Code of Civil Procedure as a bar to the cause of action pleaded in the cross-complaint, and also to the defense to his main cause of action. While it is true that a cause of action for relief on the ground of fraud or mistake must be commenced within three years from the time of the discovery of such fraud or mistake, the rule does not apply to mere defenses. It is to be remembered that this is an action to quiet title commenced by Cox, who depends upon his purported deed. By way of defense Mr. Schnerr pleads plaintiff’s fraud in obtaining said deed. While it is true that the original answer was not filed until more than three years after the date of the deed, the allegations of fraud in said answer are not restricted by the statute of limitations invoked by plaintiff. In Hart v. Church, 126 Cal. 471 , 479, [ 77 Am,

Since the defense based upon plaintiff’s fraud was effective, it makes no difference to plaintiff what affirmative relief was granted defendant on his cross-complaint, and plaintiff may not properly complain even if he were correct in his theory that the relief prayed for in the cross-complaint is barred by the statute of limitations. But it was not so cut off by the statute. The interest of Schnerr, the cross-complainant, arose upon the death of his wife. His- pleading by way of cross-complaint has for its very essence the fact that the fraudulent deed is a cloud upon his title and the relief prayed for is the removal of the cloud. Of course, the question of fraud is incidental, but the gravamen of the cross-complaint is that Schnerr, as owner of the land, may be injured by the deed if it be not canceled. Fraud is merely a feature of the case, and the running of the statute of limitations does not antedate plaintiff’s title. In other words, the case is within the doctrine of those discussed by Mr. Justice Lorigan in Scholle v. Finnell, 166 Cal. 546 -550 et seq., [ 137 Pac. 241 ],

Appellant denies defendant’s right to disaffirm the deed. He says that there being no proof of probate proceedings, or of the appointment of an administrator or executrix, there is no showing of the heir’s right to disaffirm. A similar contention was made in Page v. Garver, 146 Cal. 577 , [ 80 Pac. 860 ], but was overruled by the court on the authority of Murphy v. Crowley, 140 Cal. 141 , [ 73 Pac. 820 ], and other eases cited on page 579 of the 146th volume of the California Reports, [ 80 Pac. 861 ], (See, also, Ross v. Conway, 92 Cal. 632 , [ 28 Pac. 785 ].)

No other features of the case are sufficiently important to require discussion.

The judgment and order are affirmed.

Henshaw, J., and Lorigan, J., concurred.

Hearing in Bank denied.