Opinion · Supreme Court of North Carolina

Streator v. . Jones

10 N.C. 423

Type: Opinion
Court: Supreme Court of North Carolina
Jurisdiction: North Carolina
Date: 1824-12-05
Topic: bankruptcy

Hall, Judge The bill charges, that the money received from the defendant, Jones, was a loan and not the price of the land, and that the land was to be mortgaged as a security for the debt; that when complainant was about to execute the deed he expressed a wish that a clause of redemption should be inserted in it, but that the defendant objected, and said, “here, take the money you want and trust to my word;” and that the defendant refuses to either receive the money, or reconvey the land. From this statement, the justice of the case seems to be with the complainant, and relief ought to be granted, unless there is some rule of law, founded in policy, that forbids it. *432 It is objected, that the contract of the parties is evidenced by the deed executed by the complainant to the defendant Jones, and that parol evidence ought not to he received to contradict it; and that that principle was established in the decision of this Court which took place on the same point in July, 1810, (1 Mur. 449.) With respect to that decision, I think my recollection serves me when I say, that the decision of a majority of the Court was not as is laid down in that case. I know that the Court did strongly incline against the introduction of parol evidence to prove directly that the deed executed to Jones was a mortgage, but did not doubt but that circumstances might he given in evidence from which a jury might infer that the deed was considered by the parties as a mortgage, and find a verdict accor…

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STREATORv. JONES,10 N.C. 423(1824)

STREATOR v. JONES. — From Wake.

Supreme Court of North Carolina

December Term, 1824.

IN EQUITY

On a bill, alleging that an absolute deed executed by complainant to defendant was executed in pursuance of a contract for the loan of money, and that the land was to be redeemable by the parol contract of the parties; the Court, without meaning to contravene the rule which forbids parol evidence to contradict, vary or add to the terms of a written agreement, will yet hear parol evidence to prove facts and circumstances dehors the deed, which go to show that the true contract of the parties could not have been for an absolute conveyance; such as that the money paid was not a fair price for theabsolute purchase, that the vendor kept possession, that an account was stated between the parties, wherein the money advanced was charged as a debt and interest thereon was stated, etc.

THE bill stated that in 1799 the defendant advanced to the complainant on loan the sum of $800; and that to secure the repayment thereof, with 25 per cent interest, on or before the expiration of that year, he executed to the defendant a deed in fee simple for divers tracts of land; that it was agreed between the parties that the lands should be redeemable on repayment of the sum borrowed, with 25 per cent thereon, at the expiration of the then current year; that upon complainant's urging upon Jones that some writing expressive of such (424) right of redemption should be subjoined to the deed, Jones said: "Here, take the money you want, and trust to my word"; that complainant did trust to his word and agreement aforesaid, and signed the deed, and continued in possession until he was evicted by defendant in 1801; that before the expiration of the year 1799 complainant informed Jones that he would not be able to comply with his contract at the stipulatedPage 236time, and prayed further indulgence, to which Jones, in reply, proposed that complainant should sign a book account stating the sum of $200 to be due for the rent of that year, and at the same time promising that if he would do so he might redeem in 1800 by the payment of the principal with 12 1/2 percent, or in 1801 by the payment of the principal with 25 per cent; and the complainant, being ignorant and in distress, signed the account.

Some time in 1800 a payment of $100 was made for complainant to defendant by one Powell in part of the redemption of the land, and Jones then agreed that if within the first five weeks of 1801 the complainant would pay him the further sum of $600, and give bond and security for the balance, that he would release the land; or, if within that time he could not make such payment, that he would wait another year for the payment and during that year be content with lawful interest; that in the course of the five weeks mentioned above the complainant, by one Reading Jones, offered the defendant $500, and to pay the remaining $100 in one month, if he would surrender the deed; this Jones refused, but said he would see about it at court, which was to meet in a few days; and at the court Jones caused the deed to be recorded, and then told Reading Jones, who offered to pay the $600, that he need not trouble himself any more, for that the lands had been sold by him (the defendant) and that the complainant would never get them again. (425) Complainant then applied to Jones himself, offering to pay the $600 and to secure the remainder by bond with security, when Jones replied that he had sold the land, and offered the complainant a small pecuniary compensation for his equity of redemption; this was refused by complainant, and Jones then evicted him by means of a jury upon a complaint of forcible detainer. The lands were sold to one Martin Lane, who, it was charged, had full notice, and who paid no consideration.

The bill prayed that the sum due, with interest thereon, might be ascertained under the direction of the court, and upon payment thereof that defendant should be decreed to reconvey the lands.

The answer of Jones set up an absolute purchase of the lands, and denied that there was any agreement for redemption, and, admitting the fact that complainant remained in possession until 1801, alleged that his possession was that of a tenant only, under an agreement to pay a certain rent annually so long as he continued in possession. A promise to "resell" to complainant, made afterwards, was also admitted, but at what time was not stated.

The defendant Martin Lane answered that he was a purchaser for valuable consideration, without notice of complainant's claim.Page 237

There was much evidence in the case, and the facts shown by the depositions, so far as is necessary to a correct understanding of the points decided, will be found in the opinion of the judges.

Ruffin and Hogg for complainants.Gaston and Seawell for defendants.

HALL, J.

The bill charges that the money received from the (431) defendant Jones was a loan and not the price of the land, and that the land was to be mortgaged as a security for the debt; that when complainant was about to execute the deed he expressed a wish that a clause of redemption should be inserted in it, but that the defendant objected, and said: "Here take the money you want and trust to my word," and that the defendant refuses to either receive the money or reconvey the land.

From this statement the justice of the case seems to be with the complainant, and relief ought to be granted, unless there is some rule of law founded in policy that forbids it.

It is objected that the contract of the parties is evidenced by (432) the deed executed by the complainant to the defendant Jones and that parol evidence ought not to be received to contradict it; and that that principle was established in the decision of this Court which took place on the same point in July, 1810,Streator v. Jones,5 N.C. 449. With respect to that decision, I think my recollection serves me when I say that the decision of a majority of the Court was not as is laid down in that case. I know that the Court did strongly incline against the introduction of parol evidence to prove directly that the deed executed to Jones was a mortgage, but did not doubt but that circumstances might be given in evidence from which a jury might infer that the deed was considered by the parties as a mortgage and find a verdict accordingly; such as the value of the land at the time of the contract, the sum of money paid for it, the rent paid or agreed to be paid by complainant during the time he afterwards lived upon it. And I am supported in this from this further fact that, shortly after that decision was made, an issue was made up on this very point in the Superior Court of Wake County, where the cause was pending, and submitted to a jury. The question submitted was whether the deed was a mortgage or not. There was a mistrial. The question before that jury is the one now before this Court. It may further be observed that the same counsel appeared for the parties in both courts.

With respect to the objection that parol evidence ought not to be received to contradict or control a written instrument, as a general principle or rule of law its correctness is admitted. It is also admitted thatPage 238when the parties undertake to embody their contract in writing, and really do so (unless there is fraud, etc., in the case), it cannot nor ought it to be disturbed by parol evidence. The question, then, here is, Was the contract of the complainant and the defendant Jones committed to writing, or was there any other contract made at the time than what the deed sets forth? I think there was; because the complainant was (433) a needy man. The disproportion between the value of the land and the money received for it, the high rent which complainant agreed to give for it, and his remaining in possession so long as he did after the sale; before complainant signed the deed he wished a clause of redemption inserted; Jones said he had given full value for the land; complainant answered that he would not take three times that sum for it. After he signed the deed Jones told him if he would return the money, that was the $800 which he was about to give him, at the end of the year, together with $200 rent, that he might have the land again. This surely does not appear like a serious andbona fidepurchase of the land by Jones. Had this money been paid at the end of the year by complainant it would have been paying Jones his principal and 25 per cent interest, which the bill states the contract to have been. At this rate the purchase money would have been swallowed up in the rent due in four years. And it must appear a little singular that $200 rent should be paid for land that was only worth $800. As to the value of the land, the testimony is contradictory. It appears from some of it that the land was worth, in 1799, 75 cents per acre; that in 1804 it was worth $1, without the improvements put on it by Lane, who purchased from Jones. From this testimony the land was worth 25 cents per acre more in 1804 than it was in 1799, notwithstanding timbers had been taken from it by Streator while he lived on it, and by Lane, who lived on it afterwards up to that time. It appears from other testimony that the land in 1799 was worth $2.50 per acre, and from other testimony $3 per acre. A mean valuation between the two extremes would be nearer thrice than twice the sum for which Jones says he purchased it. But it is asked, Why did the complainant execute the deed under these circumstances? And it is argued that, as he has done it, he must be bound by it. My answer, is, he was a needy man. Jones was the lender and he was (434) the borrower; asLord Mansfieldobserves, he was the slave of the lender. Doug., 672, note. Borrowers are oppressed men; and their necessities oblige them to submit to any terms. Ca. Temp. Talbot, 41. Under such circumstances it will not do to take shelter under the maxim,Volenti non fit injuria;they are not inpari delicto. 1 Ves., 319.

InBarnell v. Sabine, 1 Vernon, 268, which happened before the statute of frauds, etc., in England, the single question was mortgage orPage 239no mortgage; and the court received evidence of the value of the land; that the purchase money was 950l., that the defendant was offered about the same time 1,400l.;and to prove that such evidence was sufficient to make it a mortgage they cited two cases,Cole v. Martin, andBeale v.Collinsneither of which cases I have been able to find. The chancellor dismissed the bill, not because he would not hear parol evidence, but because the evidence when heard did not convince him that the deed was originally a mortgage. In another case, since the statute of frauds, Ca. Temp. Talbot,Cottrell v. Purchase, the same question arose, whether a deed absolute on the face of it was intended by the parties to be a mortgage, and in that case evidence was given as to the purchase money and as to the value of the land, which was deemed by the chancellor not sufficient proof that the deed had been originally considered by the parties as a mortgage; but he added: "Had complainant continued in possession any time after the execution of the deed, I should have been clear that it was a mortgage; but she was not, and her long acquiescence under the defendant's possession is to me strong evidence that the deed was an absolute conveyance." These cases are introduced, not for the purpose of showing the final decrees of the chancellors, but to show that they permitted parol evidence to be given to prove that deeds absolute on the face of them were by the original contract considered by the parties to be mortgages. In the last mentioned case of (435)Cottrell v. Purchasethe chancellor concluded by saying that they who took an absolute conveyance of an estate as a mortgage are guilty of a fraud; for which he cited Bacon's Tracts, 37. In Prec. in Chancery, 526, it is stated that when the lender having an absolute conveyance refused to execute a defeasance,Lord Nottinghamdecreed it against him on the fraud, after the statute of frauds.

In that case the decree was made on the ground that he refused to enter into a written agreement to reconvey as the statute required, after having agreed to do so. In this case relief is prayed because the defendant refuses to reconvey after having by parol contract agreed to do so, the statute of frauds not having been in force at the time of the contract. Another case in the same book, 526, was where an absolute conveyance was made for a sum of money, and the person to whom it was made, instead of entering and receiving the profits, demanded interest for his money and had it paid him. This was admitted as evidence to explain the nature of the conveyance. This decree was made on the same kind of evidence as that objected to in this case. The only doubt entertained by the judges in this and other cases of the like kind seemed to be whether the statute of frauds stood in the way or not; for Powell, in his treatise on Mortgages, 200, where the last mentioned case is also noticed, makes this remark: "In such cases the proof offered is not consideredPage 240a variation of the agreement, but explanatory only of what it was meant to have been; and the allowing of any other construction upon the statute of frauds and perjuries would be to make it a guard and protection for fraud, instead of a security against it, which was the intention of it." I have before stated that when this contract was made there was no statute of fraud and perjuries in force in this State.

In consequence of this statute the English judges have rejected (436) parol evidence offered to control written contracts (unless they have been procured through fraud, etc.) because a parol contract is void under the statute, and it cannot be established in part by written and in part by parol evidence, more than if it all rested on parol evidence. As inWoolain v. Hearne, 7 Ves., 217, a bill was brought for a specific execution of an agreement for a lease at a less rent than was mentioned in the written agreement, and the variation was sought to be proved by parol evidence. The master of the rolls said "that the statute had been too much broken upon by supposed equitable exceptions," and that he would go no further in giving effect to parol evidence than he was forced to do by precedents. He dismissed the bill, but said that the evidence made out the complainant's case. As coming nearer to this, however, notwithstanding the statute of frauds, I must noticePemberv. Matthews, which came beforeLord Thurlow. A bill was brought by the original lessees of a leasehold estate against the assignees of the lease, for the specific performance of a parol undertaking to indemnify the complainants against all rents and covenants to be paid or kept on the lessee's part towards the original lessor, and to execute a bond for securing such indemnity; the assignment had been by sale and auction, and the conditions of sale did not state the indemnity. It was objected that parol testimony was inadmissible on the ground that when the parties have entered into a written agreement no parol evidence can be admitted to increase or diminish such agreement.Lord Thurlowsaid, "The rule of law is right, but when the objection was originally made andpromisedby the other party to be rectified, it came among the string of cases, 1 Eq. Ca. Ab., 230-1, where it is considered a fraud upon the rule of law," and ordered it to go to law upon an issue whether there was such a promise on the day of the execution of the assignment of the lease; and upon the trial the jury found there was such a promise, and complainant had a decree for a specific performance. If this (437) case was decided on the ground of fraud, I think the case before us is not altogether clear of it.

I cannot think thatLord Irnham v. Childs, 1 Brown, 92, is an authority for the defendants. In that case it was agreed that the annuity should be redeemable; but the parties thought that if there was a clause of redemption inserted it would make it usurious, and for that reasonPage 241it was agreed that such a clause should not be inserted.Lord Thurlowsaid there was no fraud in that case, and refused to relieve the parties upon parol evidence; but said that if it had been intended to be inserted, and had been suppressed by fraud, he would not refuse to hear the evidence.

It is observable in this case that the parties intended to evade the statute of usury. They were both inpari delicto. The same remark may be made as to the cases in Brown, 168; 1 Ves., 241. Cases are not wanting on this subject in the United States. InRoss v. Merrell,1 Wn. 14, the bill was brought to redeem negroes conveyed to the defendant by an absolute bill of sale; parol evidence was received to prove that it had been executed as a mortgage. The Court said they had the less difficulty in receiving it as the complainant had remained two years in possession of the negroes after the conveyance. And inRobertson v. Campbell, 2 Call., 421, the complainant had conveyed by absolute bill of sale certain slaves to the defendant; parol evidence was received to prove that it was the intention of the parties that the slaves should be redeemable, and the Court, believing the evidence, decreed for the complainant. See, also,Sadler v.Greene,14 Va. 101, andKing v. Newman,16 Va. 40, decided upon the same principle, notwithstanding, as I understand, the statute of frauds, etc., in force in that Commonwealth.

In 1 Johnson Chancery,Boyd v. McLean, the plaintiff (438) purchased of Golden a tract of land, and borrowed of the defendant the money to pay for it, and directed Golden to convey the land to the defendant as a security for the money, which was done by an absolute deed; the money was tendered and a bill filed praying a conveyance of the land; the defendant relied upon the statute of frauds.Chancellor Kentdecided that it was a resulting trust excepted out of the statute of frauds, and that the fact whether the purchase was made with the plaintiff's money might be proved by parol evidence.

In this case the complainant did not procure a third person to convey the lands as a security to the defendant, but he conveyed them himself as a security for the debt. In both cases the lands were held as a security for the debts, but by deeds absolute on the face of them. If resulting trusts are excepted out of the statute, other trusts may be proved by parol evidence when unshackled by any statute. See, also, 1 Johnson Chan., 273; 2ibid., 274, 405, 585, 630. In 1 Day's Cases, 139, parol evidence was held admissible in equity to show that an absolute deed was intended as a mortgage. 2 Day, 137. Sec, also, note to Co. Lit., 205a, note 96.

I have said that the evidence in this case convinces me that the deed in question should be considered as a mortgage, because I think it was understood by the parties that the land was redeemable; and I havePage 242come to this conclusion from the evidence given in the case. Although the evidence proving directly the declaration of Jones is not much to be relied upon, yet it is corroborative of other evidence as to the value of the land, the possession kept afterwards by Streator, and the rent charged, etc., as well as the needy situation of Streator. And I am also of opinion, from the authorities examined in this case, that it is proper the evidence should be received in reference to the deed from Streator to Jones.

I will take another short view of the case, in regard to the objection that the evidence contradicts the deed. Let it, then be admitted (439) that Jones loaned, or agreed to loan, $800 at 25 per cent interest, or at any other per cent; that it was further agreed that Streator should convey to Jones his land infee simpleas a security for the debt; and it was further agreed that when Streator should replace the money with interest (provided he did it in twelve months) Jones should reconvey the land to Streator, and that such contract rests altogether on parol evidence, and that the statute of frauds, etc., was not in force, and that parol contracts are obligatory upon the parties; and let us suppose that in part execution of the contract the land is conveyed to Jones and the money advanced to Streator; can it be said that the deed embraces the whole contract? or can it be said that the deed contradicts that part of the contract which provided for redemption? It has never been considered that a defeasance and an absolute conveyance will not stand together. It seems to me that in such case the execution of the deed is a part execution only of the contract, and that the residue of the contract remains executory. And this I say without impugning what I have before admitted, namely, that a written contract shall be obligatory, when it appears that it was the intention of the parties to commit the whole contract to writing, and there is no allegation of fraud, etc.

HENDERSON, J.

It is unquestionable that written evidence is more certain than mere oral testimony, or, as it is commonly called, parol evidence. Hence follows the rule, which seems to be very generally admitted, that what is written shall not be contradicted, controlled, enlarged or explained by mere parol, unless it isshownthat it issowritten through fraud or by accident; which latter term embraces mistakes, surprise, or the like. There equity relieves upon a principle of equitable jurisdiction, not upon the writing, but on a thing, to wit, the fraud or accidentdehorsthe writing, asLord Thurlowexpresses it inIrnham v.Childs, 1 Brown, 92; for equity relieves in cases of fraud, (440) accidents, and trusts. But the fraud here meant is not the fraud in notobservingthe contract, but that fraud by which the writing is made to speak a languagedifferentfrom the agreement; otherwise, itPage 243would afford a ground of relief in all cases, and to obtain relief in such cases such a case must be made in the bill and, of course, supported by the proofs. But the great difficulty is to ascertain what is here meant by the writtenagreement. Is it confined to those writings professing, as it were, to evidence the written agreement, or does it embrace writings made for other purposes,diverso intuitu, ex gratiato execute them, and if the latter, to such of them as contain direct expressions of the agreement; or where the parol agreement is so inconsistent with the written agreement that both cannot stand together, or where such contradiction is not absolutely repugnant to or inconsistent with the writing, but the contradiction only a probable inference. The authorities are somewhat contradictory on the subject, and I have not the vanity to believe that I can reconcile or explain them by any examination that I could make of them. Nor do I deem it necessary in this case. But where the writing is of this latter description, and the parol evidence is not absolutely contradictory and repugnant to the writing, but the contradiction only a probable inference from the writing, I think thatfactsandcircumstancesmay be shown by parol. Whatever may be the law as to mere parol declarations is too well established, I think, by all the authorities, both ancient and modern, to be now questioned. They are collected by Mr. Buller in his note in Co. Lit., page 205a, note 96. They prove the correctness of his observation, that wherever a conveyance or an assignment of an estate is originally intended as a security for money, whether this intention appears from the deed itself or any other instrument, it is always considered as a mortgage, though there is an express agreement of the parties that it shall not be redeemable, or that the right of redemption shall be confined to a particular time, or to a (441) particular discription of persons. He then observes (which is to the point in this case) that "In many of these cases the courts have found it necessary not only to apply their general principles, but to determine the fact whether the conveyance was intended as an absolute sale or only as a security for money. If the money paid by the grantee was not a fair price for the absolute purchase of the estate conveyed to him; if he was not let in to the immediate possession of the estate; if instead of receiving the rents for his own benefit he accounted for them with the grantor, and only retained the amount of the interest; if the expense of preparing the conveyance was borne by the grantor: each of these circumstances has been considered by the courts as tending to prove that the conveyance was intended to be merely pignorititious." The cases from which he draws his observations are there cited, and they fully support him; and this seems to me to be conformable to principle. That it was not to be redeemable is matter of inference, not only expressed so in the deed, but inferred from it, on the presumption that ifPage 244there had been such an agreement the deed would not have been absolute. But this is not entirely inconsistent with the deed, but only a very strong probability, which it would be impossible to overturn by proof of inconsistent parol declarations; for they are liable to be misunderstood, forgotten, or misrepresented by fraud or perjury, or set up, where there was nothing of the kind, and are incapable of disproof. But facts from which the inferences are to be drawn are not more liable to these objections than almost all human things. There are some acts which, if done with deliberation, such as the one mentioned byLord TalbotinCottrell v. Purchase, Cas. Temp. Talbot, 63, as settling an account wherein the money advanced is charged as a debt, and interest (442) stated. Now, it is possible that an absolute conveyance may be intended only as a mortgage or security for money; but it is impossible that there can be an absolute purchase and yet the purchaser retain the price. They both cannot stand together; the possibility yields to the impossibility; the absolute conveyance to the mortgage; for an absoluteconveyanceand intended as a mortgage, it may be; but an absolutepurchaseand mortgage it cannot be. I wish it to be distinctly understood that I express no opinion on principles which I have not used to decide this case; for as to them I have not pushed the inquiry far enough to form an opinion on which I can confidently rely. But this much I will observe, that in the old cases there was too much laxity permitted in the introduction of parol evidence to interfere with written contracts. Writing then was not so common as at present, and their very inheritances were conveyed by mere words accompanied by livery of seisin, all which might be, and was very often, done without any writing at all. On the contrary, of late, since the statute of frauds, there has been too much strictness in excluding it, as we are apt to run into contrary extremes; and the legal notions of the lawyers of England have been insensibly affected by the operation of that statute, which places parol evidence in the background, and in many instances it has been said that independent of the statute parol evidence would be in the background, when in truth the notion of its inferiority was insensibly produced by the statute in the manner before mentioned; and it being of no moment how it was produced, provided it was so, the matter passed off without further examination. And even in this State, where we had no statute of frauds until very lately, the same effect has been, in a minor degree, produced; for we get our legal notions, or most of them, from English authorities, and principally from those written since the passage of the statute of frauds, and particularly as to the rules of evidence. This case was before the late Supreme Court in 1810,5 N.C. 449. I was a member of the Court and concurred with a majority that mere parol declarations should not be received to contradict thePage 245deed. I did not doubt then, nor do I now, that facts might be (443) shown by parol from which it might be inferred that it was intended only as a security for money. In this opinionJudge Lockeconcurred. I have no distinct recollection ofJudge Lowrie'sopinion. The Court was composed ofJudges Taylor(the present Chief Justice),Hall, Locke, Lowrie, and myself.Judge Wright, I think, was absent.

From my view of the case I do not deem it necessary to examine the ground taken by the gentleman who closed the argument, to wit, that although the parol declarations were not admissible to prove the transaction to be a mortgage, yet they were to prove it usurious. This was incomprehensible to me. I cannot, therefore, acquiesce in it, although I do not know that I can detect the fallacy of his very ingenious argument. But I have too much experience of the extent of the powers of my own mind not to have perceived that the arguments, the fallacy of which I cannot detect, do not always lead to the truth; and when to my understanding they tend to establish something contrary to what I have arrived at by a plain and simple argument, I conclude there is error in the argument, although I cannot point out where it lies.

This transaction cannot be made a loan without making the conveyance a mortgage; for if it was an absolute purchase, the lands passed to Jones and the money to Streator; there was no debt to forbear. The evidence must, therefore, be admitted to prove the mortgage; and if the evidence is admissible to prove it a mortgage to entitle the party to redeem, it appears to me to be admissible to prove the same fact for any purpose. If mortgage deeds were void, evidence to show it a mortgage would be admissible. But mortgage deeds are not void; only usurious mortgage deeds are void. Then as to the evidence, in which I do not take the parol declarations into consideration further than Jones admits them in his answer. The question then is, do the facts proven, taken in connection with Jones' two answers, (444) show the conveyance to be intended as a security for money? I think they do. (1) As to the value, the witnesses differ from 75 cents to $2.50 and $3. I am disposed to believe that the higher valuations are nearer right, first from the amount of the rent, as admitted by Jones; the estimate made of the injury done by Streator in two years, to wit, $400, and the estimate made of the injury done by Streator and Lane, $1,000; the amount for which Jones sold the land two years afterwards, to wit, $1,200; and the two years rent, to wit, $400, making in all $1,600. Now, it is impossible well to perceive how this estimate made by the witnesses Hunter and Sugg, could be correct, to wit, $975, and yet the land in so short a time, without any convulsions in nature, or any other particular cause, received an injuryPage 246of $1,000, particularly when the $975 estimate is supported only by two men, one of whom says that the land without the wood is worth nothing, and the other only 25 cents. With this estimate as to value, taken in connection with the rent, I am of opinion that the land was worth $2,600 or more. This disparity, together with amount of rent, and Streator's retaining possession, with Jones' answer to this bill, and another answer of his read on the hearing in another suit between Streator and himself, satisfy me that Streator never would have signed the deed unless it was understood, and formed part of the contract, that upon the repayment of the money he was to have the land again. Such total disregard of value, and the sacrifice consequent thereon, are contrary to the principles which almost invariably govern human actions, which, with the high rent and Streator's retaining possession, countervail any inference which can be drawn from the absolute form of deed. And, in truth, I think that such inference is supported by Jones' answer. He admits in it that an after-promise was made (but when, he cautiously conceals) that he would (445) resell, as he calls it. These resales, particularly when made immediately after the execution of the title deeds, should be strictly scrutinized. They are most frequently mere shifts or devices to cloak the real nature of the transaction and evade the statute against usury. They form at least one link in the chain. But the object of the bargain was not to acquire the property, but to make a profit of money; not that a person may not use his money to his profit and its increase by buying and selling, but it must be a real sale and transfer of right which, from their very nature, is not to be presumed; for why should a person really andbona fidepurchase the property and in a moment after, without any cause, and before that foible of our nature, proneness to change, could exert its influence, part with it again? It is said the motive was to make money. It is admitted, and was so understood before the contract was closed, and formed part of it; and it is true there may be upon principle a sale made under such circumstances; but I have never known one, and they are so rare that I have never known a person who had. We have a full-drawn likeness of one in Jones' second answer, and if they be as he has drawn them, I wish never to witness one. But with all the aid of able counsel, the features of usury and oppression could scarcely be concealed; and if he means the same thing in his answer to this bill by a resale, as he did in that — and it is quite fair so to presume, for I believe he was the same being in both — very little evidence, much less than that offered in this case, would be sufficient to show the transaction to be a security for money only.Page 247

As to the other defendant, Lane, my impression is that he stands in the same situation as Jones, but it is not so strong that at present I would decree against him. In his favor he has the express declaration of Streator that Jones had a right to sell, and that if he, Streator, did not pay that year he gave up. Notice that Streator set up claim is sufficient, and if he undertook to judge of its validity, he did so at his peril; and I rather think he should not protect himself (446) by an exposition of the contract (not a false statement of facts by Streator) which misled him, Lane, by a needy, necessitous man, and whose whole estate was under mortgage to the person whose vanity it flattered and whose pride it swelled. I say that I am not satisfied that he is protected by such means. He does not appear to be abona fidepurchaser; but at present I am not prepared to say that he stands in the place of Jones. Retain the bill also as to him for further directions.

TAYLOR, C. J.,dissentiente:From the case made by the bill, the allegations of which it is not necessary to repeat, the complainant can only be relieved by being allowed to show, by parol evidence, that the deed, though absolute on its face, was redeemable; or that the defendant agreed by parol to reconvey upon repayment of the sum borrowed. I have understood the rule to be settled, both at law and in equity, that parol evidence is not admissible to disannul and substantially vary a written agreement. Nearly a century ago it was said byLord Hardwickethat to add anything to an agreement in writing, by admitting parol evidence, is not only contrary to the statute of frauds and perjuries, but to the rule of the common law before the statute was in being. 2 Atk., 383. In the last branch of the proposition he was supported by decisions made before the statute of frauds, 5 Coke, 25 b, 3 Lev., 234, and by many since which have been cited in the argument, particularly that leading one ofMeres v. Ansell, 3 Wils., 275. The same doctrine has been more recently stated and confirmed by another chancery judge of preeminent learning,Sir William Grant, whose words are: "By the rule of law, independent of the statute, parol evidence cannot be received to contradict a written agreement. To admit it for the purpose of proving that the written instrument does not contain the real agreement would be the same as receiving it for every purpose. It was for the purpose of shutting out (447) that inquiry that the rule of law was adopted. Though the written instrument does not contain the terms, it must, in contemplation of law, be taken to contain the agreement, as furnishing better evidence than any parol can supply." 7 Vesey, 219. These authorities, selected from the numerous decisions on this subject, seem conclusively toPage 248establish the general rule that where there is a solemn deed or agreement in writing no parol agreement can be set up to alter or vary, in any manner, the written contract. Nor can I discern any circumstance in the case made out by complainant to bring it within any of the exceptions to the general rule. Those exceptions are that extrinsic evidence is admissible to prevent fraud, to correct mistakes, or to protect against surprise or accident. It is material to observe that neither fraud, mistakes, or accident are alleged in the bill; but an agreement, by the mutual consent of the parties, to leave out, or not annex to the deed, a defeasance or clause of redemption. It was said by the chancellor, inLord Irnham v. Childs, 1 Bro. C. C., 92, that if the agreement had been varied by fraud, parol evidence would be admissible; that if the bill had stated that the clause was intended to be inserted, but it was suppressed by fraud, he could not refuse to hear evidence read to establish the rule of equity. As it was, the parties omitted a provision in a deed on the impression of its being illegal, and having trusted to each other's honor, they must rely upon that, and cannot require the defect to be supplied by parol evidence. InLord Portmore v. Morris, 2 Bro. C. C., 219, the evidence went to prove that it was part of the agreement for an annuity that it should be made redeemable; but such agreement for redemption making no part of the written contract, the master of the rolls observed "that if fraud had been imputed, the evidence might have been admitted, but that it was dangerous otherwise to depart from the deeds. It (448) might be the intention that the annuity should be redeemable, but he could only get at it by demolishing one of the foremost rules of law. He would, therefore, reject the evidence."Hare v.Sherwood, 1 Vesey, Jr., 241, was decided on the same principle. From all the cases the principle may be inferred that is not sufficient merely that the evidence goes to establish fraud, or that it may be concluded from the circumstances of the case, such as inadequacy of price, the continuance of the vendor in possession, etc., but the bill must contain a distinct and positive imputation of it; otherwise, the defendant is surprised by the case set up by evidence which was not made by the bill. The court may add a trust or a clause to an absolute deed where the omission or suppression has been occasioned by fraud or misrepresentation; they will place the contract in the shape it would have assumed if no imposition had been practiced. But when the party seeking relief negatives the fraud by placing the omission to the account of an understanding and consent on both sides, I cannot perceive how relief can be given to him without admitting that a contract may rest partly in a solemn deed and partly in a parol promise, and that the latter shall be enforced to the overthrow of the former,Page 249although fairly made. And it will be seen in those cases even where fraud was imputed, and the court cannot reject parol evidence to establish it, however cautious they are in giving effect to it, where the object of it is to set aside written instruments. InHutchins v. Lee, 1 Atk., 447, a bill was filed to set aside the assignment of a leasehold estate, upon a suggestion that the same was never intended as an absolute assignment, but was meant to be subject to a trust for the benefit of the complainant. The terms of the deed itself were much relied upon as furnishing evidence that it was not intended as an absolute assignment, and as tending to confirm the external evidence. Upon a view of all the authorities, I find the conclusion irresistible that parol evidence of the promise to reconvey ought to be rejected; and I will next inquire whether it is proper to consider the (449) circumstances attending the transaction in order to arrive at the conclusion that the absolute deed was subject to a redemption or repurchase. It appears to me to be equally within the mischiefs which the rule of evidence intended to guard against to construe an absolute deed to be conditional, upon the proof of extrinsic circumstances, which are still established through the medium of parol evidence. The parol proof may still misrepresent or mistake the circumstances as much as if it were introduced directly to alter or disannual the deed; and it is the danger of impairing the force and effect of a written contract by inferior evidence that the law seeks to avoid. This case furnishes a remarkable illustration of the danger of resorting to circumstances; for the testimony respecting the value of the land, a most important fact in the decision of the question of mortgage or no mortgage, is absolutely irreconcilable. Nor have I found any cases on this branch of the question which either did not come within the exception of fraud or mistake or where there was not some writing signed by the vendee at the time of the contract, admitting the true nature of the agreement, or some statement of accounts or calculations authorizing a clear reference to it. It is stated in a note of 2 Fonblanque, 262, that parol evidence is admissible to show or explain the real intention and purpose of the parties, though the conveyance be absolute; and for this he citesMaxwell v. Montacute, Prec. Ch., 526;Walkerv. Walker, 2 Atk., 98, andJoynes v. Statham, 3 Atk., 338. The first case, as it is reported in 2 P. Wms. and 1 Strange, was a bill to enforce the specific performance of a parol promise made before marriage to execute a marriage settlement; there was a plea of the statute of frauds and perjuries, which, upon the circumstances of the case, was ordered to stand for an answer. But much reliance is placed by the chancellor upon the defendant's having written a letter after the marriage acknowledging the promise. The ground of the (450)Page 250decree subsequently made was that the promise was intended to be reduced into writing, but was prevented by fraud. InWalker v. Walkerthe defendant was allowed to read parol evidence to rebut the equity set up by the bill; the chancellor saying it was not properly evidence in support of an agreement, but a defense arising from the fraud and imposition of the plaintiff. InJoynes v. Stathamthe object of the bill was to carry an agreement into execution for the lease of a house signed by the defendant only, upon the face of which agreement the plaintiff was to pay a sum of 9l., and it was insisted by the defendant that it ought to have been inserted in the agreement that the tenant was to pay the rentclear oftaxes, but that the plaintiff having written the agreement himself, had omitted this part of the contract. The evidence was admitted by the chancellor, who likened it to the case of a mortgagee bringing a bill to foreclose where no proviso for redemption was inserted, and the mortgagor was a marksman, and of a mortgage by an absolute conveyance and defeasance, where the defeasance was omitted to be executed by the mortgage; in both which cases evidence ofthe omission by mistakeshould doubtless be received. The cases referred to in Harg. Co. Lit., 203, appear to me liable to the same observations. The two last cases are where the evidence was offered on the part of the defendant, and must be referred to the latitude allowed by courts of equity to parol evidence, where it is offered to resist an application for a specific performance, especially where it discloses a ground of fraud. When the court is called upon to grant extraordinary relief, resting in its discretion, it will always refuse it if the justice of the case is on the side of the defendant.

Whether parol proof be admissible on the part of the plaintiff, who seeks specific performance of an agreement in writing, and also wishes to vary it by parol proof is much considered inWoolman v.(451) Hearn, 7 Ves., 211, in which it was rejected, though if the parties had been reversed it would have been admissible.Higginson v.Colans, 15 Ves., 516, andClinin v. Cooke, 1 Shoal Lefroy, 39, are to same effect. Nor do I feel myself at liberty to put any construction upon the deed which shall give it a different character or effect from what it bears upon its face, in consideration of their contract entered into by the defendant, of a similar character, which he considered as mortgages; for I understand it to be a well settled rule of law that in the construction of a deed, or agreement, the acts of the parties cannot be taken into consideration.

The language of the deed is clear and unequivocal, and admits of but one exposition; nor can that be varied, because the parties have acted under it, or others of a like import, as if it were a mortgage. InClifton v.Walmsley, 5 Term, 564, it was held that where the lesseePage 251of a coal mine covenated to pay a certain share of all such sums of money as the coal should sell for at the pit's mouth, he was not liable under that covenant to pay to the lessor any part of the money produced by sale of the coal elsewhere than at the pit's mouth, and that evidence of the lessee's having accounted with the lessor, and paid him the share of money produced by the sale of coal elsewhere is not admissible to explain the intention of the parties. There are several cases to the same effect, both in law and equity, and the doctrine affords an additional safeguard to the authority and efficacy of deeds.Baynham v. Hospital, 3 Ves., 295;Eaton v.Lyons, 3 Ves., 290; 2 New R., 452.

Another ground taken by one of counsel for the complainant was that as the deed was founded on an usurious consideration it was void, and on that account ought to be set aside. Whatever weight there might be in this objection to the deed, if properly brought before the court, it is not necessary to decide, because I think it is to be seen that this mode of relief was not the one which the bill in its original structure sought for. The bill shows that the relief expected was to obtain (452) a reconveyance of the land upon the strength of the parol evidence. A reconveyance is the relief prayed for in the bill, whereas when instruments are absolutely set aside for fraud there ought not to be a reconveyance. 2 Ves., Jr., 287. Nor is the bill framed with a double aspect, either to reconvey or set aside the conveyance in the event of its being declared usurious. Another circumstance showing strongly that such was not the object of the bill is that the only terms upon which equity will decree an instrument founded upon an usurious consideration to be delivered up and canceled are the plaintiff's paying to the defendant what is really due to him. The omission of such an offer in the bill is a ground of demurrer. 1 Fonb., 45. There is nothing on the face of the proceedings to apprise the defendant that the deed would be attacked on this objection; and the voluminous evidence taken in the cause, directed to the other points made by the bill and answer, shows the understanding of the parties. The best consideration I have been able to give this case has led me, individually, to the conclusion that the bill ought to be dismissed.

PER CURIAM. Affirmed.Cited: Smith v. Brown, post, 587;Poindexter v. McCannon,16 N.C. 376;Jackson v. Blount,17 N.C. 557;McLaurin v. Wright,37 N.C. 97;Blackwell v. Overby,41 N.C. 45;Kelly v. Bryan, ib., 287;Watkins v.Williams,123 N.C. 174;Porter v. White,128 N.C. 43;Sandlin v.Kearney,154 N.C. 605.Page 253