{ "id": 1378592, "name": "Arkansas Bank & Trust Company v. State Bank of Poplar Bluff", "name_abbreviation": "Arkansas Bank & Trust Co. v. State Bank of Poplar Bluff", "decision_date": "1924-12-08", "docket_number": "", "first_page": "538", "last_page": "548", "citations": [ { "type": "official", "cite": "166 Ark. 538" } ], "court": { "name_abbreviation": "Ark.", "id": 8808, "name": "Arkansas Supreme Court" }, "jurisdiction": { "id": 34, "name_long": "Arkansas", "name": "Ark." }, "cites_to": [ { "cite": "158 Ark- 179", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1355631 ], "opinion_index": -1, "case_paths": [ "/ark/158/0179-01" ] }, { "cite": "8 N. W. 260", "category": "reporters:state_regional", "reporter": "N.W.", "opinion_index": -1 }, { "cite": "60 Neb. 771", "category": "reporters:state", "reporter": "Neb.", "case_ids": [ 2728529 ], "opinion_index": -1, "case_paths": [ "/neb/60/0771-01" ] }, { "cite": "25 Am. Rep. 270", "category": "reporters:state_regional", "reporter": "Am. Rep.", "opinion_index": -1 }, { "cite": "85 N. E. 256", "category": "reporters:state_regional", "reporter": "N.E.", "opinion_index": -1 }, { "cite": "152 Ark. 110", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1364076 ], "opinion_index": -1, "case_paths": [ "/ark/152/0110-01" ] }, { "cite": "120 Ark. 326", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1561063 ], "opinion_index": -1, "case_paths": [ "/ark/120/0326-01" ] }, { "cite": "19 Ark. 378", "category": "reporters:state", "reporter": "Ark.", "opinion_index": 0 }, { "cite": "16 Ark. 541", "category": "reporters:state", "reporter": "Ark.", "opinion_index": 0 }, { "cite": "15 Ark. 333", "category": "reporters:state", "reporter": "Ark.", "opinion_index": 0 }, { "cite": "51 Ark. 417", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 8723603 ], "opinion_index": 0, "case_paths": [ "/ark/51/0417-01" ] }, { "cite": "152 Ark. 110", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1364076 ], "opinion_index": 0, "case_paths": [ "/ark/152/0110-01" ] }, { "cite": "120 Ark. 326", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1561063 ], "opinion_index": 0, "case_paths": [ "/ark/120/0326-01" ] } ], "analysis": { "cardinality": 674, "char_count": 21313, "ocr_confidence": 0.488, "pagerank": { "raw": 1.6343475431493036e-07, "percentile": 0.6896019806560151 }, "sha256": "cb4930386d7d838870daaeeca7bff720afb4d3750e668aefc703751210637766", "simhash": "1:8d89e9adf6a59cd6", "word_count": 3764 }, "last_updated": "2023-07-14T21:22:16.783155+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "Arkansas Bank & Trust Company v. State Bank of Poplar Bluff." ], "opinions": [ { "text": "Wood, J.\nThis action was instituted in the chancery court of Jackson County, Arkansas, by the \u00a1\u00e1tate Bank of Poplar Bluff and J. W. Ivy, as trustee (hereafter called the appellees'), against the Arkansas Bank & Trust Company and W. It. O\u2019Neal and Clarissa O\u2019Neal. The Arkansas Bank & Trust 'Company will be hereafter called appellant. Appellees alleged that W. R. O\u2019Neal and Clarissa O\u2019Neal, his wife, on or about the 3rd of October, 1919, executed their promissory note to the Farmers\u2019 Savings Bank of Butler County, Missouri, in the sum of $5,000, and a deed of trust to John Ivy, meaning J. W. Ivy, trustee, to secure said note on the following lands in Jackson County, Arkansas, to-wit: \u201cAll of lot 8 in block 21 of the city of Newport, Arkansas,\u201d which deed of trust was duly recorded in said county; that the Farmers\u2019 Savings Bank assigned the said indebtedness and the security to appellee State Bank of Poplar Bluff; that the grantors in the deed of trust at the time wrote to the Farmers\u2019 Savings Bank, the beneficiary, that the land embraced in the deed of trust fronted ninety feet on Walnut Street running back to an alley 142 feet in the city of Newport; that the description set forth as lot 8 in the deed of trust contained said frontage; that after-wards it was discovered that lot 8 is only 35 feet on Walnut Street, fifteen feet thereof having been conveyed to the trustees of the Christian Church, and that the other fifty feet intended to be embraced in said deed is lot 9 of said block 21; that the Farmers \u2019 Savings Bank relied upon the representations as to the size of the lot and the land to be embraced in the deed of trust, and the grantors intended that same should be .embraced in said deed of .trust, and it was therefore a mutual mistake of the parties ; that the deed of trust was not drawn so as \u2022 to embrace the lots intended to be conveyed as above set fortlt. Appellees alleged that, to cure the defect in the original deed of trust, as above set forth, the O\u2019Neals afterwards executed a deed of .trust to the Farmers \u2019 Savings Bank dated October 3,1919, which was duly recorded, intending thereby to carry out the original conveyance, and that this deed of trust inured to the benefit of the appellees.\nAppellees further alleged that the appellant brought a suit against the O\u2019Neals and the Farmers\u2019 Savings Bank, and, as ancillary thereto, caused a writ of attach-, ment to be issued and levied upon all of said lots; that the transfer and sale of the indebtedness and the security therefor to the appellee, State Bank of Poplar Bluff, was long prior to the institution of the suit by the appellant against the Farmers\u2019 Savings Bank and the O\u2019Neals; that the O\u2019Neals, in consideration of the dismissal of the suit and the attachment above set forth, executed to the appellant a mortgage or deed of trust on the property intended to be embraced in the deed of trust securing the indebtedness which had been transferred to the appellee; that, notwithstanding the above agreement to dismiss the attachment proceedings, the appellant'is still seeking some right under said attachment. Appellees alleged that, by reason of the acceptance by the appellants of the deed of trust or mortgage before mentioned, the appellant had abandoned its action, and the attachment against the property described was thereby discharged; that the indebtedness of the O\u2019Neals to the Farmers\u2019 Savings Bank of Missouri, which had been transferred to the appellee, was past due and unpaid; that it \u00bfmounted to $5,987.52. Appellees prayed that the deed of trust given to secure such indebtedness be reformed toi carry out the intention of the parties thereto, and that appellees have judgment in the sum above mentioned, and that the deed of trust as reformed be\u2019foreclosed to satisfy such judgment, and that the appellant be pretermitted until appellees \u2019 judgment should be satisfied.\nAppellant, in its answer, challenged the right' of the appellees to have the deed of trust reformed as alleged and to have the same declared a first lien on lots 8 and 9 of block 21 of the city of Newport, and alleged that, prior to the institution of -this suit, it had instituted an action in the chancery court of Jackson County against the O\u2019Neals on an indebtedness due the appellant,- in which-action it had an attachment issued and levied on lot 9 and also on lot 8, block 21, described in appellees\u2019 complaint. It was also alleged that appellant had a superior lien on the property described in appellees\u2019 complaint by virtue of a certain deed of trust executed by W. B. 0 \u2019Neal and Clarissa 0 \u2019Neal on May 31,1921, conveying the above property to a trustee for the benefit of the appellant.\nThe cause was heard upon the pleadings and exhibits and the depositions of the witnesses. W. B. O\u2019Neal tesr titled that he and his wife, Clarissa O\u2019Neal, executed a deed of trust on October 3,1919, to the Farmers\u2019 Savings Bank of Butler County, Missouri, to secure an indebtedness of $5,000, which he borrowed from that bank. Witness told M]r. Chapman, the cashier of the bank, that he had two lots in Newport, and gave him the deed to draw up the papers and mortgage. It was witness\u2019 intention to embrace both lots as security for that debt. The State Bank of Poplar Bluff, appellee, after it had taken the mortgage over from the Farmers\u2019 Savings Bank, discovered that lot 9 had been omitted from the mortgage. Witness got appellee to take over the debt and mortgage from the Farmers\u2019 Savings Bank. The cashier of the appellee didn\u2019t notice for some time that the mortgage didn\u2019t include lot 9, and witness said that he thought the mortgage covered both lots. It was the intention of witness and his wife to include the business lots on Walnut Street in the city of Newport, 100 feet front on Walnut Street, less what witness had sold to the Christian Church. Witness had before that sold fifteen feet off of his lot next to the church. The appellee didn\u2019t discover the error until the appellant brought suit against witness. Then they came down and brought the deed of trust they had bought from the Farmers\u2019 Savings Bank and asked, \u201cHow is this, that we haven\u2019t got a deed of trust to both lots down there in Newport?\u201d Witness told them be was no lawyer, and had nothing to do with the drawing of the deed of trust, and: that it was witness \u2019 understanding that they had a deed of trust on both lots down there. These were lots that witness had bought from Mrs. Creighton, and witness gave the deed.to the cashier of the Farmers\u2019 Savings Bank to draw up the papers, and witness attached a copy of that deed as an exhibit. Witness had given no other security to appellee to secure the indebtedness covered by the $5,000 note which was transferred to the appellee. Witness did give a mortgage to the Farmers\u2019 Savings Bank covering the bakery, machinery and fixtures, to secure this same note that witness gave the deed of trust on the property in Newport to secure.\nWitness further testified that he and his wife were sued by the appellant in the chancery court of Jackson County, recently, and that action was compromised out of court. Witness and his wife both executed a mortgage to the appellant to secure a debt he owed appellant. The appellant agreed, if witness would give a mortgage on the two lots and the house, they would stop the suit, and witness executed the mortgage, which appellant now holds, with that understanding.\nThe cashier of the Farmers\u2019 Savings Bank, appellee, testified that it was agreed between him and the O\u2019Neals that O\u2019Neal was to give a deed of trust on some business property in Newport to secure a promissory note of $5,000 executed to the Farmers\u2019 Savings Bank. Witness didn\u2019t know the property personally, but O\u2019Neal stated that the deed of trust was to cover the entire piece of business property except the part that he had sold to the church. Witness was shown the deed of trust, and stated that he didn\u2019t know who drew it. He didn\u2019t know why it didn\u2019t include all the property, as it was his understanding that the appellee was to get all the business \u25a0property of O\u2019Neal which'he had recently acquired in Newport, except that part sold to the church. Witness didn\u2019t recall any of the circumstances in' regard' to the preparation and execution of the note and deed of trust: He handled the transaction of the assignment of the note and deed of trust from the Farmers\u2019 Savings Bank to the appellee through Mr. Hayes, cashier of the appellee.\nP. C. Hayes, cashier of the appellee at the time, testified that O\u2019Neal came to him asking for a line of credit, and stated that he owed the Farmers\u2019 Savings Bank $5,000 secured by a business lot in the town of Newport, Arkansas. He stated that he paid $5,000 for the lot, but had since sold off fifteen feet to a church. Witness asked O\u2019Neal what was the size of the lot, and he stated that it was 100 feet less fifteen feet. Witness asked Mr. Chapman, cashier of the Farmers\u2019 Savings Bank, about the security, and he said that it was a business lot in the town of Newport. Witness discovered that a part of lot 9 was omitted from the deed of trust in October, 1920. He asked Mr. O\u2019Neal again about it, and he reiterated that the deed of trust included one 100-foot lot. Witness let it go for a while, until he saw the complaint of appellant. The appellee had other security \u2014 a chattel mortgage covering the fixtures, machinery and equipment of the bakery shop \u2014 which was given prior to the purchase of the $5,000 note. When witness took over the note from the Farmers\u2019 Savings Bank, he had in mind that it was secured by a 100-foot lot. If witness had known that it only included a fifty-foot lot, he would not have bought the paper. O\u2019Neal made the statement that the lot was 100 feet when he came to the appellee as its customer in November, 1919.\nJohn E. Williams testified that he was the cashier of the appellant, and was familiar with the action brought by the appellant in the chancery court of Jackson County against O\u2019Neal and others on an indebtedness to the appellant, which suit was instituted in the summer of 1920. Later O\u2019Neal executed a deed of trust to the appellant to secure the payment of this indebtedness. At the time this deed of trust was executed the appellant had no knowledge of a deed of trust executed by O\u2019Neal and wife on November 27, 1920, correcting a former deed of trust under which the appellee claims. There was no record at that time of this deed of trust of November 27, 1920; that was not filed for record until June 1,1921. At the time O\u2019Neal gave the deed of trust to the appellant, there was no agreement made that the suit then pending in the Jackson Chancery Court by appellant against the O\u2019Neals would be dismissed. The consideration for the deed of trust executed by the O\u2019Neals to the appellant was the original indebtedness due by the O\u2019Neals to the appellant, and was given in consideration that the time for payment of this indebtedness should be extended.\nChas. D. Henry testified that he was the president of the appellant, and was familiar with the action brought by the appellant in the Jackson Chancery Court against O\u2019Neal and others, in which the property of O\u2019Neal was attached, and appellant later obtained a deed of trust from O\u2019Neal to secure the payment of his indebtedness to appellant on the agreement of appellant to extend the time of payment for such indebtedness. There was no agreement between the appellant and O\u2019Neal to dismiss the action, except as to O\u2019Neal\u2019s home. Appellant didn\u2019t agree to dismiss the action with -regard -to the lots on Walnut Street and claimed by the appellee. At the time appellant obtained the deed of trust from O\u2019Neal under which it now claims, it had no knowledge of the deed of trust now set up by the State Bank of Poplar Bluff as a correction, of the deed of trust which this action was brought to reform. There was an agreement to the effect that the deed of trust from O\u2019Neal and wife on the 27th of November, 1920, executed to the appellee, Farmers\u2019 Savings Bank, to correct the description of the property in the original deed of trust from O\u2019Neal and wife to the Farmers\u2019 Savings Bank, was filed for record in the office of the recorder on June 1, 1921.\nThe trial court found that the O\u2019Neals executed to the Farmers\u2019 Savings Bank of Butler County, Missouri; their promissory note in the sum of $5,000, October 3, 1919, and that, to secure the payment of same, they executed their deed of trust to all -of lot 8, block 21, city of Newport, Arkansas,' and that it was the understanding and agreement between the parties at the time that the deed of trust should cover a frontage of ninety feet on Walnut Street, in block 21 of the city of Newport, which would have included all of lot 9 and 35 feet of lot 8 in said block; that thereafter, on the 27th -day of November, 1920, the O\u2019Neals executed and delivered to the Farmers\u2019 Savings Bank of Butler County, Missouri, their deed of trust correcting such description and embracing lot 9, block 21, aforesaid, but that same last named deed of trust was not properly executed and acknowledged by Clarissa O\u2019Neal; that thereafter the O\u2019Neals executed and delivered to the appellant their deed of trust dated May 31, properly executed and acknowledged by Clarissa O\u2019Neal, whereby her dower interest in lot 9 was conveyed to the appellant; that, prior to the institution of this action, the note and deed of trust held by the Farmers\u2019 Savings Bank were transferred and assigned to the appellee.\nUpon these findings the court entered a decree in favor of the appellees against the O\u2019Neals for the amount of the note with interest in the sum of $6,767.50, and decreed that the deed of trust of October 3, 1919, be reformed so as to embrace lot 9 and all of lot 8 except a strip 15 feet wide off the east side thereof, block 21, and declared the same to be a first lien on the property as above described, subject to the dower rights of Mrs. Clarissa O\u2019Neal in lot 9, and directed that the property be sold and the proceeds held subject to the further order of the court. From that decree is this appeal by the appellant, and the appellee cross-appeals here from that part of the decree denying the appellee right to the dower interest of Mrs. Clarissa O\u2019Neal in lot 9.\n1. While there are some discrepancies in the testimony of the witnesses who testified for the appellee as to whether the deed of trust of October 31, 1919, should be reformed so as to embrace lot 9 and all of lot 8, block 21, city of Newport, Arkansas, except a strip fifteen feet wide off the east side of lot 8, as contended by the appellee, yet these discrepancies are unimportant, as they do not relate to the essentials which the appellee was required to prove in order to entitle it to reformation. These essentials are, that it was understood and agreed by the O\u2019Neals and the Farmers\u2019 Savings Bank at the time the deed of trust was executed, and as a consideration therefor on the part of the O\u2019Neals, that the property as last above described was to be embraced in the deed of trust to secure the $5,000 indebtedness to the Farmers\u2019 Savings Bank. The testimony of O\u2019Neal, who conducted the negotiations for himself and wife, and the testimony of Chapman, who conducted the negotiations for the Farmers\u2019 Savings Bank, was clear and unequivocal to the effect that it was their understanding that the property as above described was to be included. O\u2019Neal states that he told Chapman that his business property in Newport was to be included; that he and his wife intended to secure the debt to the Farmers\u2019 Savings Bank by a mortgage on all the Walnut Street property except fifteen feet off of lot 8, which he had sold to the Christian Church. Chapman\u2019s testimony was to the effect that it was their understanding that the bank was to have a deed of trust on all of O\u2019Neal\u2019s business property which he had recently acquired.\nSo we conclude that the testimony is clear, unequivocal and convincing that it was the intention of the parties to the deed of trust to embrace the property as sam'e is described above in the decree reforming the deed. Such was the manifest intention of the parties to the instrument, and the O\u2019Neals afterwards undertook to effectuate their intention by executing an instrument on November 27, 1920, designated a deed of trust, in which the Farmers\u2019 Savings Bank was the beneficiary, describing the property as they intended it should be in the original deed of trust of October 3, 1919. The evidence is clear, unequivocal and decisive that the parties to the original deed of trust intended to include the property described in the court\u2019s decree reforming that instrument, and that the failure to so describe the property was the result of a mutual mistake. The proof meets the requirements of the law in such cases. Eureka Stone Co. v. Roach, 120 Ark. 326; Tri-State Construction Co. v. Watts, 152 Ark. 110.\n2. The appellant contends, however, that the appellee was not entitled to have the deed of trust reformed because, before the appellee instituted this action for that purpose, the appellant had acquired a specific lien on the property by an attachment which had been issued in the action in chancery and levied on lot 9, and, by a deed of trust executed by the O\u2019Neals to appellant, embracing the same property, that the lien thus acquired by the appellant is superior to the lien of the appellee because of negligence on the part of the appellee in not having his deed reformed before the alleged rights 'of the appellant accrued. The appellant would be correct in its contention if it had perfected its inchoate attachment .lien. See Hawkins v. Files, 51 Ark. 417. But the specific inchoate lien obtained by the attachment was not followed up and perfected by a judgment or decree in that action in favor of the appellant against the O\u2019Neals. Merrick & Fenno v. Hutt, 15 Ark. 333; Lamb v. Belden, 16 Ark. 541; Frellson v. Green, 19 Ark. 378. Instead of doing this, appellant accepted the deed of trust executed May 31 and acknowledged Jlune 1, 1921, and recorded June 11, 1921. This action on the part of the appellant was tantamount to the abandonment of its inchoate attachment lien; and the appellee had its corrected deed of trust put of record on June 1, the day appellant\u2019s deed of trust was acknowledged, and ten days before appellant\u2019s deed of trust was recorded. It thus appears that, in the race of diligence between these creditors, the lien of the deed of trust under which the appellee claims was prior in point of time to the deed of trust under which the appellant claims. The appellee\u2019s equities therefore under its corrected deed of trust are paramount to those of the appellant, and the trial court did not err in so holding.\n3. The appellees contend on cross-appeal that the trial court erred in not foreclosing- the deed of trust on the dower and homestead rights of Mrs. Clarissa O\u2019Neal, but appellees do not present any testimony to sustain sncli contention. Tbe trial court found that tbe deed of trust of November 27,1920, executed by the O\u2019Neals, was not properly acknowledged by M,rs. O\u2019Neal, and bottoms its decree as to dower and homestead on such finding. Appellee does not abstract tbe testimony on tbis issue, nor do we find any testimony on tbis issue abstracted by tbe appellant. Therefore, in tbe absence of any testimony to tbe contrary, it must be presumed that tbe court\u2019s decree is correct on tbe issue raised by tbe cross-appeal.\nWe find no error in tbe decree of tbe court, and it is therefore in all things affirmed.", "type": "majority", "author": "Wood, J." } ], "attorneys": [ "Boyce & Mach, for appellant.", "Gustave Jones, for appellee." ], "corrections": "", "head_matter": "Arkansas Bank & Trust Company v. State Bank of Poplar Bluff.\nOpinion delivered December 8, 1924.\n1. Reformation of instrument \u2014 sufficiency of evidence. \u2014 In \u00e1 suit to reform a deed of trust to include land omitted by mutual mistake, evidence of such mistake held to be clear, unequivocal and convincing.\n2. Attachment \u2014 abandonment of lien. \u2014 Where a creditor securing an inchoate attachment lien on the debtor\u2019s .property failed to perfect it and accepted a deed of trust in lieu thereof, such action was tantamount to an abandonment of the attachment and thereby let in an intervening lien of a deed of trust of a third \u2022person which was recorded before the attaching creditor\u2019s deed was recorded.\n3. Appeal and error \u2014 presumption from absence of testimony.\u2014 In the absence of testimony to the contrary, it is presumed on appeal that the action of the trial court in excepting dower and homestead rights from the lien of a deed of trust was correct.\nAppeal from Jackson Chancery Court; Lyman F. \u25a0 Reeder, Chancellor;\naffirmed.\nBoyce & Mach, for appellant.\nTo justify or authorize the reformation of a written instrument on the ground of mistake or fraud, the evidence of such mistake or fraud must be clear, unequivocal and decisive. 120 Ark. 326; 152 Ark. 110. Where the mistake is the result of one\u2019s own carelessness or inattention, a court of equity will not interfere in his behalf. 4 Md. Ch. Ct., 335; 85 \u00d1. E. 256; 81 111. 130; 25 Am. Rep. 270; 60 Neb. 771; 8 N. W. 260. Those who seek the equitable relief must show that they are without negligence in the matter. 24 Am. & Eng. Ency. of Law, 656.\nGustave Jones, for appellee.\nAn acknowledgment taken oyer the telephone is good. 158 Ark- 179." }, "file_name": "0538-01", "first_page_order": 564, "last_page_order": 574 }