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Guardian and ward-sale of land-collusion -effect.
(- Okla. -, 179 Pac. 62.) defendants the Prudential Insur- effect admitted that this state of ance Company of America and facts existed, but Mr. McNeal, the the Deming Investment Company, attorney, attempts to excuse any frankly admits that he understood, further investigation by showing he as a matter of law, the payment of propounded a question to Mr. Cash, the purchase price partly in prop- the guardian of the minors, eliciterty, contrary to the statutes, and ing an answer to the effect that the
the order of the Oklahoma City property which was court would render being conveyed to the guardian was the sale void. That
a private deal between him and Mr. such a sale would McDonald. Cash being an interestbe void against the parties to the
ed party and one of the main contransaction can hardly be contro- spirators to defraud his wards, and verted.
the party apparently reaping the To connect the acts of the origi- greater benefit from the transacnal interested parties subsequent to
tion than anyone else, it seems the the bidding in of the property at
answer this question would public sale with their prior acts in bringing about the sale
causes us to naturally invite a further inquiry
rather than to have the effect to conclude that if a specific intent to defraud were not formed in the be- satisfy and remove any suspicion or
doubt. The uncontradicted testiginning of the negotiation, it is reasonably clear that it was intended
mony shows that the conveyance of to secure title to the lands of these this Oklahoma City property, under minors by undue influence and for an agreement of all parties, was less than its value, resulting detri- placed with Mr. McNeal, with the mentally to the minors. We there- other conveyances, and was not to fore hold that the finding of the be delivered until all the conditions court on this issue is contrary to had been complied with and at the both the preponderance and weight time the other conveyances were to of the evidence.
be delivered. This, in itself, would The only other question necessary suggest that it was so intimately to be determined is, were the facts linked with the conveyance of the and circumstances such as to give minors' land and formed a part of notice or impute knowledge to the
the same transacdefendants the Prudential Insur- tion, to be delivered knowledge of ance Company of America, the Dem- only when ing Investment Company, and transaction was fully completed,Jennie C. Estus? The weight of au
would not only suggest, but would thority unquestionably is that under require, a further investigation to such circumstances, where parties ascertain
the true facts. Overall v. claim to be inno- Taylor, 99 Ala. 12, 11 So. 738; Pom. Burden et proof cent bona fide pur- Eq. Jur. § 601. Under the law in
chasers for value, this jurisdiction as construed by purchase. the burden rests on
this court such inthem to show themselves to be such.
formation to an put upon Clark v. Sayers, 55 W. Va. 512, 47
interested party is inquiry. S. E. 312; Bowman v. Griffith, 35
equivalent to knowledge on all facts Neb. 361, 53 N. W. 140; Berry v.
which could be ascertained from a Whitney, 40 Mich. 65.
reasonable investigation. Cooper The facts and circumstances re
v. Flesner, 24 Okla. 57, 23 L.R.A. lated as having transpired in the of
(N.S.) 1180, 103 Pac. 1016, 20 Ann. fice of the attorney for the Prudential Insurance Company of
Cas. 29; Nute v. Nute, 41 N. H. 60; America and the Deming Invest- Schnavely v. Bishop, 8 Kan. App. ment Company were such as to put 301, 55 Pac. 667; Goree v. Goree, 22 the attorney upon inquiry, and such Tex. Civ. App. 470, 54 S. W. 1036; facts need not be restated. It is in Fischer v. Lee, 98 Va. 159, 35 S. E.
-bona fides of
examination of title.
441; Manasses v. Dent, 89 Ala. 565, the preponderance of the testimony, 8 So. 108.
but to the weight
Evidence It is contended, however, that thereof, and that in judgment
contrary to. Mr. McNeal was not the attorney. rendering a generfor the defendant Jennie C. Estus, al judgment for the defendants, preand she must be held to be an inno- judicial error was committed. The cent purchaser. To this contention plaintiffs admit that they are not
entitled to retain the $15,000 sewe are unable to give our consent.
cured by the loan on the land in We are of the opinion that the more reasonable rule would be that where question, and at the same time se
cure a decree of court canceling the a purchaser, under such circumstances as here, elects to rely upon by this proceeding.
instruments sought to be canceled the investigation and the opinion of
Owing to the conclusion reached, the attorney for the loan company, holding the conveyances void on acwho examined the title for the pur
count of the fraud practised, it is pose of making a
unnecessary to determine whether loan to the pur- this is a direct or collateral attack chaser, for all in
upon the judgment appealed from. tents and purposes he should be held Sockey v. Winstock, 43 Okla. 758, to be the attorney for such pur
144 Pac. 372; Wimberly v. Winchaser, and charged with knowledge stock, 46 Okla: 645, 149 Pac. 238. of all matters, facts, and circum- It is not charged, and neither do stances entering into or connected the facts show, that the defendant with the negotiation tending to af- the Prudential Insurance Company fect the title to such property. actively participated in any of the There was nothing inconsistent in fraud affecting the title to the land Mr. McNeal, as attorney for the in question, but we only hold that it loan companies, to also represent had such knowledge or notice sufthe purchaser and the borrower;
ficient to put it upon inquiry, that, and, if she was willing to intrust to
if reasonable diligence had been him the duty of passing upon the used, it could and would have actitle for her, based upon facts which quired full knowledge of the fraud he acquired in passing upon the title of the other defendants sufficient to for the loan company, he would be prevent it from being an innocent her attorney no less than if he was
encumbrancer. The judgment of employed separately and subse- the trial court will be reversed, with quently to the passing on the title
directions to enter a decree cancelfor the loan companies. Gardner v.
ing each and all of the conveyances Early, 72 Iowa, 518, 34 N. W. 311; sought to be canceled by this proGriffin v. Franklin, 224 Mo. 667, 123 ceeding, and restoring the title to S. W. 1092; Baldwin v. Root,
the lands involved unencumbered to Tex. Civ. App. —, 38 S. W. 630.
the minor plaintiffs, conditioned But counsel contend she paid no upon the payment by the guardian fee for this service, and therefore
of the sum of $15,000 to the court she would not be bound by his clerk, with further directions to the knowledge of the facts affecting the court to ascertain the actual and title. It is not a prerequisite that a necessary cost and expense to the
fee should be paid minors in the prosecution of this Client-necessity before the relation suit, including a reasonable at
attorney and torney fee, which shall be deducted client may exist. Packard v. Delfel, from the amount of $15,000 so de9 Wash. 562, 38 Pac. 208.
posited, and the balance of said We are constrained to hold that amount shall be paid to the defendthe judgment and findings of the ant the Prudential Insurance Comtrial court are contrary not only to pany of America.
bona fide parchaser-notice.
(- Okla. —, 179 Pac. 62.) It is hereby recommended that any greater effort to ascertain the such decree be entered.
true condition of affairs than is dis
closed by this record. Per Curiam:
We note the motion of the preAdopted in whole.
vailing parties to modify the opinA petition for rehearing having ion of the learned commissioner by been granted, the following Per striking therefrom the condition Curiam response was handed down that plaintiff in error shall pay the on March 18, 1919:
clerk of the court the sum of $15,After a careful examination of 000, and substituting therefor a the record upon rehearing, the court condition that plaintiff in error shall is convinced that the opinion pre- pay into court such portion of said pared by Mr. Commissioner Linn is
sum as may remain undisposed of. in the main correct, and that, with
As this portion of the decree was the slight modification hereinafter entered in pursuance of admissions pointed out, it should be approved. made by counsel for the movant, We are of the opinion that Mrs. both in open court and in their Estus was not only bound by the briefs, that such a condition would notice and knowledge acquired by be equitable in case they prevailed, McNeal, but, like McNeal, she came and as we believe it is an equitable
into possession of condition of recovery, we decline to purchaser
facts sufficient to make the modification prayed for. put a prudent per- Objection is also made in the peson .
upon inquiry; tition for rehearing to that part of She knew the transaction involved Commissioner Linn's opinion which the transfer of the allotted lands of directs the trial court to award the Indian minors, and that a sale by plaintiff in error a reasonable atthe guardian must be for cash. She torney's fee, to be deducted from also knew that the delivery of the the "$15,000 so deposited.” As the
“ guardian's deed to McDonald was question whether the plaintiffs in in some way dependent upon the error would be entitled to recover consummation of the deal between attorney fees, in case they prevailed, herself and McDonald, and she has not been passed upon by the knew, or could have known by slight trial court, we will not pass upon it inquiry, that the land she conveyed now, but will leave it open for origto McDonald in exchange for the inal consideration below, if either minors' lands was to be immediate
to be immediate- party desires to raise it. To this exly transferred to Cash, the guardi- tent the opinion is modified. . an, either for his own benefit or for For the reasons stated the opinthe benefit of his wards, and that ion of Mr. Commissioner Linn, as the money she borrowed from the hereby supplemented and modified, Prudential Company was to be used is adopted and approved as the in payment of a portion of the pur- opinion of the court. chase price bid for the minors'
All the Justices concur. lands, at the guardian's sale. Indeed the whole transaction between McDonald and his associates, and
NOTE. Cash, which was largely enacted in the presence and hearing of McNeal The general question of the imputaand Mrs. Estus, bore so many of the tion of the knowledge of an attorney familiar earmarks of a conspiracy to his client which is considered in to defraud these Indian minors of the reported case (PYEATT V. ESTUS, their estates, that it seems incred- ante, 1570) is discussed in the note ible to us that neither of them made post, 1592.
A. E. HESS (C. F. HARDER and S. C. HOLMES, Appts.)
Kansas Supreme Court - July 7, 1914.
(92 Kan. 787, 142 Pac. 253.) Notice - knowledge of attorney judicial sale.
1. Knowledge by an attorney for the holder of a certificate of purchase of land sold at a judicial sale, of a contract which he had negotiated between the purchaser and the landowner, relating to redemption, and of the payment of money which came into his hands, by way of redemption according to the contract, will be imputed to an assignee of the certificate, who soon afterward employed the same attorney to represent his interests, when the knowledge was present in the mind of the attorney throughout his second employment.
[See note on this question beginning on page 1592.] - knowledge of agent - payment of hearing of a motion filed by the attormoney.
ney on behalf of the certificate holder 2. Knowledge that the attorney had to require the sheriff to execute a deed. obtained possession of the redemption The only substantial issues were those money paid under the contract, impart- involving the professional conduct of ed to an agent of the assignee who had the attorney, who was a witness, and active charge of his principal's interests who conducted the proceedings as an as a holder of the certificate, will be im- attorney. Held, the court was author-' puted to the principal.
ized to exercise its disciplinary power [See 21 R. C. L. 838.]
over the attorney as one of the results Estoppel - to deny redemption - per
of the investigation. mitting payment.
[See 2 R. C. L. 1026.] 3. With knowledge of the contract and of the possession by his attorney
On Petition for Rehearing. of the money paid for redemption, the Courts - jurisdiction - power of leg- . assignee of the certificate acquiesced islature. and permitted the landowner to com- 6. The case of Re Burnette, 73 Kan. plete redemption by paying to the clerk
609, 85 Pac. 575, so far as it points of the district court the remainder of out the distinction between original the sum necessary for that purpose. and appellate jurisdiction and the lack Held, after the period of redemption of power on the part of the legislature expired, the holder of the certificate to confer original jurisdiction on this was estopped to deny that redemption court, followed. had been effected.
Appeal trial of facts constituAttorney - compelling payment into
7. Section 580 of the Civil Code 4. A portion of the redemption money (Gen. Stat. 1909, 8 6175) providing obtained by the attorney not having that in all cases except those triable by been paid to the holder of the certifi
jury, as a matter of right, this court cate, it belonged in the custody of the
may, on appeal, receive further testi. clerk of the district court, and the court
mony and adopt such procedure as may had summary jurisdiction to compel be necessary or expedient for a full and the attorney to restore to the treasury final hearing and determination of the of the court the money which he had
cause, would be unconstitutional, if condiverted.
strued to authorize a prolongation or [See 2 R. C. L. 1026.]
renewal of the trial of issues of fact - disciplinary power.
in this court on appeal. 5. The facts were developed on the [See 7 R. C. L. 1073.) Head notes by BURCH, J.
(92 Kan. 787, 142 Pao. 253.) Statute construction authorizing of fact occurred in the district court in appellate court to try facts.
August, 1912. A rehearing was grant8. To save the section from uncon- ed, and another trial occurred in Febstitutionality, it must be interpreted ruary, 1913, when the parties extended merely as providing this court with their evidence to their own satisfacadequate means for exercising its true tion. Evidence which was available appellate jurisdiction. The nature of then, and which merely supplements the the court's function is not changed, and proof offered in the district court, is the scope of its original jurisdiction is now tendered to this court. Held, the not enlarged, but the exercise of its ap- court is not authorized by $ 580 of the pellate jurisdiction is facilitated by Civil Code to receive and consider the ' giving it command of aids to review, evidence, and no occasion exists for desupplemental to the strict record of the
parting from the rule that, after the cause and sufficient to meet the exi
district court, which is created and gencies of any case.
equipped for that purpose, has made a Appeal – extrinsic evidence.
final determination of the issues of fact 9. Without the aid of a statute this
in a cause, original investigation of court may, in the exercise of its appel
such issues is closed. late jurisdiction, avail itself of authentic evidence outside the record to pre
Attorney - discipline - procedure. vent a miscarriage of justice, to avoid
11. The form of procedure which rea useless circuity of proceeding, to pro
sults in an exercise of the disciplinary tect its jurisdiction, to protect itself
power of a court over one of its attoragainst imposition where the contro- neys is not material to the validity of versy has been settled, or, for other the order, so long as the essentials of reason, no longer, in fact, exists, and fair notice and opportunity to be heard perhaps under other peculiar and are observed, and in this case it is held extraordinary circumstances.
that every requirement of due process - power to hear.
of law was satisfied. 10. In this case a trial of the issues [See 2 R. C. L. 1028.]
APPEALS by the certificate holder and his attorney from rulings of the District Court for Woodson County, rendered in an action brought to recover upon a promissory note and for the foreclosure of a mortgage given to secure its payment, the former appealing from a judgment denying his motion to require the sheriff to execute a deed of the premises, and the attorney appealing from an order requiring him to pay certain money into court. Affirmed.
The facts are stated in the opinion of the court.
Messrs. C. W. Shinn and S. C. 133; Moore v. Wade, 8 Kan. 380; ForeHolmes, for appellants :
man v. Carter, 9 Kan. 674; Henson v. The court erred in overruling appel- Wolcott, 19 Kan. 207; McNeill v. Edie, lant's motion for an order for a deed, 24 Kan. 110; Reynolds v. Fleming, 30 for the reason that the uncontradicted Kan. 106, 46 Am. Rep. 86, 1 Pac. 61; evidence showed that the period of re- Crapster v. Taylor, 74 Kan. 774, 87 demption had expired, and that the
Pac. 1138. land had not been redeemed from ju
A judgment of a court, even upon a dicial sale.
subject of litigation within its jurisStewart v. Park College, 68 Kan. 465,
diction, but not brought before it by 75 Pac. 491; Clark v. Nichols, 79 Kan. 612, 100 Pac. 626.
any statement or claim of the parties, Jurisdiction of the person of a de
is null and void. fendant is essential to the validity of a
Gille v. Emmons, 58 Kan. 118, 62 judgment against him.
Am. St. Rep. 609, 48 Pac. 569; WhitHargis v. Morse, 7 Kan. 415.
more v. Stewart, 61 Kan. 254, 59 Pac. There cannot be a valid personal 261; Shurtleff v. Chase County, 63 Kan. judgment without notice. To sustain 645, 66 Pac. 654; Shaffer v. Austin, 68 such a judgment there must be due Kan. 234, 74 Pac. 1118; Bowman v. service of legal process.
Hazen, 69 Kan. 682, 77 Pac. 589; Wood Kansas P. R. Co. v. Streeter, 8 Kan. v. Nicholson, 43 Kan. 461, 23 Pac. 587.