being made to his father; when his father told him, that rather than send the deed back to Boardman, he would execute a deed to him for the lots himself. This promise of his father was satisfactory, but owing to inattention and the absence of complainant, the execution of the deed was neglected until the following spring; when complainant returning home, and learning that Mrs. Fairhurst had instituted suit against his father for an assault and battery, became uneasy about the safety of the lots, and procured his father to execute to him the conveyance of the 15th May, 1855, which, with the deed from Boardman to his father, was put upon record.

The bill distinctly and positively alleges that the whole of the purchase money was furnished by complainant, that the lots were purchased for him, and the deed was to be made to him, but, by mistake of Boardman, was executed to his father.

These allegations are controverted by the answer of Mrs. Fairhurst; and, on the contrary, she alleges that the purchase money was furnished and paid by Jonathan Lewis, who bought the lots for himself, and took the deed from Boardman in his own name, and for his own use; and that afterwards, and after she had commenced suit against him for damages, he made a voluntary and fraudulent conveyance of the lots to his son, John, for the purpose of defeating the satisfaction of any judg ment she might recover against him in the pending action.

The denial of the answer that John Lewis furnished the purchase money, that the lots were purchased for him, that the deed was to be made to him, and that by mistake it was executed to his father, must be treated as a matter of pleading, putting in issue merely the allegations of the bill, as these facts were not within appellant's personal knowledge, and she could only answer, as she did, upon information and belief.

The material allegations of the bill are clearly proven by one witness, and he is supported by two others, in some of the important facts stated by him.

That the father had the right to permit his son, during his

TERM, 1861.]

Freeman et al. vs. Peay, Rec'r.

minority, to labor for himself, and appropriate his wages according to his own inclinations, is well settled.

The lots having been purchased for the son, with his money, and upon an agreement that the deed was to be made to him, and the deed having been executed to the father by mistake, he held the legal title in trust for his son, and when he afterwards conveyed the property to his son, he did only what he was bound in equity to do, and what the son could have compelled him to do, by bill, had he refused, regardless of the pending suit of Mrs. Fairhurst against him for damages.

The fact that the son, when he furnished the money to purchase the lots, intended to permit his father and mother to occupy the premises as a home, during their lives, was commendable in him, and does not militate against his right to have the mistake in the execution of the deed corrected, and his title to the property established.

The decree of the chancellor must be affirmed.

Mr. Justice FAIRCHILD did not sit in this case.

MARY

VARS

LAW SCHOOL
LIBRARY.

FREEMAN ET AL. VS. PEAY, REC'R.

A mortgage, like any other deed, to be valid and operative, must not only be signed and sealed, but it must be delivered by the maker, and accepted oy the mortgagee, or some one legally acting for him.

[DECEMBER

Freeman et al. vs. Peay Rec'r.

Appeal from Pulaski Chancery Court.

Hon. H. F. FAIRCHILD, Chancellor.

GARLAND & RANDOLPH, for appellants.

The records read in evidence, and the deposition of Davies, who was a trustee of the Bank, and one of the committee to consummate this matter with Ware, show that instead of accepting the mortgage, the Bank rejected it, because of the incumbrance created by the deed of trust in favor of Ware's creditors under which Davies and Johnson now act. Then, if the mortgage was not accepted by the Bank, she has no rights under it. An acceptance of the mortgage was indispensable to complete the contract. 2 Hilliard on Mortgages 278; Dale vs. Bodman, 3 Metcalf 139; Jackson vs. Phipps, 12 Johnson Rep.

418.

Mr. Chief Justice ENGLISH delivered the opinion of the court. The only question to be decided in this case is, whether the mortgage, which Peay, as receiver of the assets of the Real Estate Bank, seeks, by his cross-bill, to foreclose, for the payment of a stock note male by Ware, the mortgagor, was delivered by him, and accepted by the bank.

A mortgage, like any other deed, to be valid and operative, must not only be signed and sealed, but it must be delivered by the maker, and accepted by the mortgagee, or some one legally acting for him. 2 Hiliard on Mort. 278; Jackson vs. Phipps, 12 John R. 421; Jackson ex. dem. McCrea vs. Dunlap, 1 John. Cas. 114; Dole vs. Bodman, et al. 3 Metc. R. 142; Sheppard's Touchstone, 57.

It is alleged in the cross-bill that the mortgage was delivered, accepted, proven and recorded; but Ware, in his answer, in response to the allegation, and to a special interrogatory put to him by Peay, positively states that it was not accepted by the bank, but on the contrary, was absolutely rejected; and Anthony H. Davies, who was a director in the branch of the

bank at Columbia, where the transaction occurred, and whose deposition was the only one read upon the hearing, most emphatically sustains the answer of Ware as to the refusal of the bank to accept the mortgage.

Abner Johnson was the owner of 300 shares of the capital stock of the bank, had executed his stock bond for $30,000, secured by mortgage, and, it seems, the bank, upon faith thereof, had discounted his stock note for $15,000. He agreed to transfer to Ware, who desired to become a stock-holder, 100 shares of his stock. It appears that, on application to the board of directors, the following order was made, 30th March, 1840.

"Ordered by the board that the transfer of one hundred shares of Abner Johnson's stock be made to Thomas Ware, and the notary is hereby authorized to prepare all the acts necessary to carry the same into execution."

The cashier of the bank was the notary, and it seems that in pursuance of the above order, Ware, on the 1st of April, 1840, executed a stock bond for $10,000, a mortgage upon 633 acres of land, known as the Ware place, on Old River lake, in Chicot county; and Davies states that in anticipation of the completion of the transfer of stock, etc., Ware's stock note for $5,000 was discounted. But the board of directors, as above shown, rejected the mortgage, on the ground that the lands were encumbered; Johnson was not released from any of his stock, and Ware failed to become a stock-holder. The bank made an effort, after the rejection of the mortgage, to secure the stock note and other debts of Ware, by deed of trust, but failed. The mortgage remained in the bank until after the deed of assignment to trustees, and finally, on the 2d of May, 1843, the attorney of the trustees procured the attesting witnesses to go before the recorder of the county, and prove the subscribing of the mortgage by Ware, and caused it to be registered, without the knowledge or consent of Ware.

The bank, or its cashier, acted hastily, or incautiously in discounting Ware's note before a satisfactory mortgage was executed by him and accepted by the board of directors.

[DECEMBER

Freeman et al. vs. Peay, Rec'r.

Ware, however, denies most positively, in his answer, that he ever received of the bank one dollar on the note; on the contrary, he states that the amount for which he gave the note was to be credited on Abner Johnson's stock note; and there are some facts in the record that favor the truth of his answer in this respect.

On the same day (3d March, 1840,) that the order was made for the notary to prepare the necessary papers for the transfer of 100 shares of Johnson's stock to Ware, it appears that the board also passed the following resolution:

"Resolved. That the cashier be, and he is hereby authorized to open the stock credit account of Thomas Ware for five thousand dollars, on account of the one hundred shares of stock purchased from Abner Johnson, and that he be hereby authorized to substitute his stock note in lieu of five thousand dollars of said Johnson's stock note, and that said Johnson be authorized to withdraw his former stock note, and substitute a new one for ten thousand dollars, being the sum due."

If Ware made his note for $5,000, under this resolution, it is hardly probable that the bank was guilty of the gross error of giving Johnson credit for that amount, and at the same time advancing to Ware the amount of the note, in its bills, less the usual discount, etc.

Moreover, Ware's note was made in April, 1840, but was dated back to 26th October, 1839, to correspond, it seems, with the date of Johnson's stock note; which favors the conclusion that it was to be substituted for so much of his note; for if the note had been discounted, it is but reasonable that it would have been dated on the day the money was advanced to Ware upon it.

If this be the correct version of the matter, the bank was under no legal necessity of suffering any loss by the transaction; because if Johnson was credited with the amount of Ware's note in anticipation that the agreement between them for the transfer of stock would be perfected by the execution of the necessary securities, and the completion of the agreement