
    Richmond.
    Morgan and Another v. Booker.
    January 17, 1907.
    1. Appeal and Errok—Issue Out of Chancery.—Where the evidence relating to the principal fact in a chancery suit is conflicting, the credibility of witnesses is involved, and a charge of fraud is to be determined, and this court is not satisfied that the ends of justice have been attained by the decree entered by the trial court, it will reverse the decree and remand the cause with direction to frame an issue and have it tried by a jury ttf ascertain the fact in controversy.
    2. Evidence—Witnesses—Death of An Original Party.—Upon the trial of an issue between the holder of a negotiable note and one who has assumed its payment, to ascertain whether or 'not the holder was in good faith the holder and owner for value, and, therefore, involving the validity of a subsequent payment to the payee, no question is involved as to the execution of the note or its original validity, nor any other question in which the payee has, or can have, an interest, and such holder is a competent witness, notwithstanding the death of the payee.'
    Appeal from a decree in chancery of the Corporation Conrt of the city of Boanoke. Decree for the complainant. Defendants appeal.
    
      Reversed.
    
    The opinion states the case.-
    G. W. Crumpecker, for the appellants.
    G. S. Bowman, for the appellees.
   Keith, P.,

delivered the opinion of the Conrt.

W. O. Booker, the appellee, filed his bill in the Corporation Court of the city of Boanoke, charging that on the 21st of September, 1890, L. L. Powell and wife and G. Y. Booker and Fannie B., his wife, conveyed to David B. Morgan,* with general warranty of title, two certain parcels of land in the city of Boanoke, known as lots Bos. 1 and 2, as shown on the map of Biver View Land and Manufacturing Company; that the unpaid purchase money, a part of the consideration mentioned in said deed, was evidenced by two interest-bearing negotiable notes, of even date with the deed, for $1,250 each, executed by Morgan and made payable to Powell and Booker, or order, at the Bational Exchange Bank of Boanoke, Va., in one and two years, respectively, from date; that on the 21st of September, 1890, Morgan conveyed these parcels of land to C. A. Huffman, trustee, to secure to Powell and Booker the payment of the said two notes; that on the 15th of May, in the year 1894, before the said deed of trust had been in any way released, and before the second of said notes had been paid, Morgan conveyed both of said lots to his wife, Jannette Morgan, the said Jannette Morgan being then informed that the deed of trust had never been released and the second of the two notes had not been paid; that prior to the time when Jannette Morgan became the purchaser of these lots, L. L. Powell, one of the payees in said second note, and one of the beneficiaries in the deed of trust, endorsed and delivered it to the other payee, G. Y. Booker; that prior to or about the time Jannette Morgan became the purchaser of said lots, G. Y. Booker, the then holder of the second note, endorsed and delivered it unto Fannie B. Booker, his wife, as follows: “Pay to the order Fannie B. Booker, G. Y. Booker”; that about the same time Fannie B. Booker, who then held the second note, endorsed the same generally as follows: “Fannie B. Booker,” and delivered the second note to William 0. Booker, who now holds it; that Jannette Morgan, at the time of her purchase of the lots well knew of the endorsement and deliveries of the. second note, and that "VV. 0. Booker had become the holder thereof from Fannie B-Booker, and that with such knowledge she made several payments on the said note, which payments were credited on the back of the note, aggregating $115; that at the July term, 1901, of the Corporation Court, on the motion of Jannette Morgan against G. Y. Booker, L. L. Powell, D. R. Morgan, and 0. A. Huffman, trustee, while the legal title to said lots was still outstanding in 0. A. Huffman, trustee, Jannette Morgan moved the court for a decree authorizing the clerk to mark the deed of trust satisfied, and releasing the same on the margin thereof, on the ground that the entire purchase price of the lots had been paid, and that the second note which W. O. Booker then held had been paid; that in order to sustain her motion, Jannette Morgan fraudulently procured from G. Y. Booker, one of the beneficiaries in said deed of trust, a deed purporting to release the deed of trust, which release deed bears date on the 14th of February, 1901, and is among the papers in the cause. The release deed named C. A. Huffman, trustee, as party of the first part, G. Y. Booker as party of the second part, and D. E. Morgan as party of the third part, but is signed, sealed and acknowledged only by G. Y. Booker, C. A. Huffman not joining in it. The deed recites that “whereas the said G. Y. Booker afterwards became the sole owner of said notes and the same have been fully paid off and satisfied, and the said David E. Morgan desires that the said property shall be released from the said deed of trust; now, therefore, this deed witnesseth,” etc., and releases the lien of said deed of trust; that at the time of the fraudulent procurement of the said deed of release by the said Jannette Morgan, the said G. Y. Booker, was deranged and of unsound mind, and incapable of attending to any business whatsoever, and had been of deranged, unsound and weak mind for a number of years prior thereto; that relying upon this fraudulent deed of release the court granted the decree asked for, wdiich was, in part, as follows: “The court being satisfied that the proof shows that the debt secured by the deed of trust hereinafter mentioned has been paid and discharged, it is ordered that the clerk of this court shall endorse on the margin of the page of the deed book wherein the said deed of trust is recorded the following: ‘The debt secured by this deed of trust has been satisfied and discharged. See Common Law Order Book 20, page 385,’ which entry when so made shall operate as a satisfaction and discharge of the debt secured by said deed of trust and as a release of said deed of trust”; that in accordance with the order the clerk did mark said deed of trust as satisfied and released; that the whole proceeding under the motion of Jannette Morgan was a fraud upon the rights of W. O. Booker, and at the time of said motion and decree the said-Booker was and is now the holder of the second note, and is entitled to all the benefits and rights arising from the deed of trust; that he is entitled to have said order set aside and annulled as fraudulently procured, and to have a trustee substituted in the place of O. A. Huffman, trustee in the said deed of trust, and to have the said two lots of land sold by the substituted trustee to satisfy the second note which he now holds and which remains unpaid,

Jannette Morgan answered this bill. She admits the execution of the deed by Powell and Booker to David B. Morgan, and that the balance due was to be paid in two equal installments of $1,250 each, secured by deed of trust; that she became the purchaser from David B. Morgan before the deferred install■ments of purchase money had been paid, but claims that the lien had been fully satisfied to G. V, Booker, the holder and rightful owner thereof. She denies that G. Y. Booker ever endorsed and delivered the second of said notes to Dannie B. Booker, his wife, or that the same was ever delivered to W. 0. Booker; and further denies that the note has at any time been endorsed and delivered to W. O. Booker, and that she ever had any knowledge of complainant’s ownership of the note. She denies that she ever paid the complainant any part of the note at any time, but says that she and her husband together made many payments on the two notes which were given by her husband for the deferred payments of purchase money; that they continued to pay in small sums, as fast as they could earn it, on the first note until it was paid off in full, and then began the payment of the last note, and continued its payment in small sums until it was all paid off and satisfied. She admits that the note was properly endorsed by L. L. Powell to Booker ; that for a valuable consideration these notes fell to G. Y. Booker in a final settlement between him and Powell, in which settlement Booker released his right in other property to L. L. Powell which had theretofore been held by them as joint owners. She denies that any consideration passed from Pannie B. Booker, the wife of G. Y. Booker, nor was it contemplated to vest any right of property to the note in her, but, on the contrary, it was done for the mutual convenience of the husband and wife, he being feeble and unable to give his personal attention to business for several years prior to his death, and the general endorsation on the note by Pannie B. Booker was not a conveyance thereof to anyone, and conveyed no more interest in the note than simply to have it collected by the bank officer for her. She admits that she made a motion before the Corporation Court after due notice to all parties, in strict conformity with the law of the state, and that after full and complete testimony and proof to the satisfaction of the court that all of the debt secured by the deed of trust had been paid, the clerk was directed to endorse satisfaction of the lien upon the deed book. She denies that- there was any fraud practiced upon the rights of complainant or anyone else in the procurement of the deed of release. She denies that G. Y. Booker was deranged or demented, but declares that though ill and physically disabled, he was of sound mind.

TJpon the issues thus raised evidence was taken. W. O. Booker, in his deposition, states that he loaned his brother $800, and that for that consideration the note was endorsed and delivered to him; that the name of Pannie B. Booker was on it when he received it; that no part of it had ever been paid, except certain small sums endorsed upon it; and that he became the owner of the note in the latter part of 1890 or the early part of 1891, before it fell due. '

In his bill, it will be recalled, that he claimed to have become the owner of the note about the time Jannette Morgan, became the purchaser of the land on -which it constituted a lien, and her deed bears date the 15th of May, 1894. According to his deposition, therefore, he became the owner of the note in the latter part of 1890 or the early part of 1891, and certainly before it fell due; while in his bill it is stated that he became the owner of it not earlier than the 15th of May, 1894. The statement of W. O. Booker with respect to the consideration is by no means satisfactory, and the same is true of the proof as to the mental condition of G. Y. Booker at the date of the deed of release signed by him.

Upon the whole case we are of opinion that as the evidence is conflicting, the credibility of witnesses is involved, and a charge of fraud is to be determined, the proof is not sufficiently definite and certain to satisfy us that the ends of justice have been attained by the decree of the Corporation Court, and in order that the subject may be more fully investigated, an issue should be framed and tried before a jury to ascertain whether or not W. 0. Booker was in good faith the owner and holder, for value, of the note in controversy, upon the trial of which issue W. O. Booker is to hold the affirmative.

We are further of opinion that W. O. Booker will be a competent witness upon the trial of that issue. The question here does not involve an inquiry into the execution of the note, nor its original validity. The subject of investigation is the payment of that note. Beither the estate of G. Y. Booker, nor that of his wife, is interested in the result of the issue to be tried. Appellant claims that the note has been paid, and in proof of it vouches a release from G. Y. Booker; W. 0. Booker asserts that it has not been paid, and relies upon the transfer of the note to him by G. Y. Booker; so that, in no event, can tbe estate of G. Y. Booker or bis wife bave any interest in the subject.

Tbe decree complained of will be reversed, and this court will enter such decree as tbe Corporation Court should bave entered.

Reversed.  