EMERSON v. ATWATER. cise of this part of their jurisdiction. Neither the statute of frauds, nor the statute requiring powers and trusts to be created in writing, is, we think, encroached on, by a court of equity exercising its jurisdiction in this class of cases, as it was wont to do before these statutes were passed. A different construction of the statutes would make them what they were never intended to be, a shield for the protection of oppression and fraud. The evidence clearly shows the deed was given to enable Atwater to sell the property, and, after paying the incumbrances, to pay himself what Emerson was owing him. Atwater, in his answer, says, Emerson was owing him $30,000, for advances that he had made to him; and that he was insolvent. Of this sum, $8,200 were secured by a mortgage on the premises, given on 1st November, 1850. This mortgage, though given before, was recorded after the Eaton and Blackmar mortgage, and stood as the last incumbrance on the property. Emerson and Atwater were brothers-in-law, and the property consisted of one hundred and eighty-one acres of land adjoining the city of East Saginaw. Its value was, in a great measure, speculative, and depended on the future growth of the city, and the use that might be made of it in platting and selling it for city purposes. Three of the witnesses, Little, Andre, and Glasby, in speaking of its value in May, 1853, estimate it as worth, at that time, from thirty to seventy thousand dollars. Mr. Little says, the valuation he "should put upon it, at that time, would be from thirty to forty thousand dollars; that was before we had got very much inflated." The other two witnesses value it much higher. And from two other witnesses, it would seem Mr. Atwater himself valued it at $100,000 or more, in 1854. The value of property under such circumstances, is so uncertain and difficult to be got at, depending, as it always must, more on the future than the present, that no great importance should be attached to this testimony. It is referred to, as the parties EMERSON v. ATWATER. may have been, and probably were, influenced in what they did, more or less by this speculative value; and consequently, there is nothing in the circumstances of the case rendering it improbable that the transaction was what it is represented to have been in the bill of complaint. An embarrassed man would not be very likely to voluntarily release his hold on what he looked upon as a fortune. Nor is there anything improbable in a relative coming to his rescue in such a crisis. We have not the testimony of any witness who was present when the deed was executed. Nor is there any evidence of a settlement between the parties at the time, or of the amount Emerson was then owing Atwater, or of the discharge of Emerson's indebtedness by Atwater. Their past transactions, for ought that appears, remained in the same condition after the deed was executed that they were in before. Ashman, who was Emerson's book-keeper at the time says he was present at several conversations between the parties, about the time the deed was executed, and that he understood from such conversations, that the property was to be made over "to Atwater in trust, and the proceeds thereof applied as follows: First, to pay off all incumbran ces existing on the property; Second, to pay off the indebtedness that was claimed to be due to Atwater from the complainant, and the balance, if any, was to be refunded to complainant." He further says, he "distinctly understood that the conveyance, although absolute on its face, was intended to be a mere trust, for the purpose of discharging certain pressing incumbrances, and to secure Atwater for moneys claimed to be due to him from Emerson." He repeats the same thing in substance, but in somewhat different language, in other parts of his testimony. While Atwater was at Saginaw at this time, and it appears from the testimony he was not there over a week. Norman Little had a conversation with him regarding the EMERSON v. ATWATER. property. He stated to Little, "that he had made large advances to Emerson, and his object in taking a conveyance of the property was, that he might secure himself, and manage it to better advantage for Mr. Emerson; that he did not want to make anything out of it himself." To W. L. P. Little, he said in 1854, "I have only got this property in possession to prevent its being sacrificed; and when I get what I have advanced to Mr. Emerson, and what I am liable for him, he will have the property again." He stated, at different times, and on different occasions, to Lyon, Richmond, Nugent, Minnick, Andre, Bullock, Richardson, and Whitney, that after he had got out of the property enough to pay the incumbrances and himself, the balance of the property would belong to Emerson, or language to that effect. - Durfee and Atwater were partners, and resided in Buffalo, in 1853. Soon after Atwater returned to Buffalo, he sent a Mr. Dorr, who was in his employ at the time, to Saginaw, to take charge of the mill property. By Dorr he sent two letters to Emerson, both written by himself one in the name of the firm, and the other in his own name. In the first, he stated Dorr was the authorized agent of Durfee & Atwater to take charge of the mill property, comprising six acres of land, &c. His individual letter to Emerson commenced as follows: "I have made an arrangement with Mr. Durfee to go in with me in the purchase of the mill and six acres, including the houses, buildings, docks, shops, logs, &c., belonging to the same, for $16,000; the logs to be paid for at cost. Mr. Dorr goes up to take possession," &c. Near the close of the letter, he uses the following language: "I think the arrangement a good one, and if no hindrance is put in the way of its completion, we shall soon have the balance of the property in a way of being sold in lots as may be required." The language of this letter is deserving of notice. It is, "I have made an arrangement with Mr. EMERSON v. ATWATER. 66 Durfee, to go in with me in the purchase," &c. Not to sell him an undivided half of the mill property, but to go in with me in the purchase of it. Again, “I think the arrangement a good one, and if no hindrance is put in the way of its completion," &c. What reason had he to suppose any hindrance would be put in the way of its completion? Was it that Emerson might be dissatisfied with the price? And was it to obviate such objection the sentence was made to close, we shall soon have the balance of the property in a way of being sold in lots, as may be required." In the winter of 1854, Ashman says, the mill and six acres were valued by him and Atwater at $18,000. Richardson says, Atwater told him in the fall of 1853, that he had purchased the old mill and six acres. And in a conversation with Nugent, in March, 1854, he spoke of the price he had paid for the old saw mill. Ashman, also mentions the sale of the saw mill and six acres in his testimony. It further appears, from Ashman's testimony, that in the spring of 1854 Atwater agreed to take of Emerson twentyone water lots, at $250 a lot, and to give him credit for them. Nugent says he was present when Atwater selected the lots. He does not remember the number of lotsthinks there were from twelve to fourteen. Minnick testifies that he "heard Atwater say he had bought twentyone water lots of Emerson, and was going to put up a saw mill," &c. Atwater also spoke of this purchase to Richardson, in a conversation between them. These are the lots on which the new saw mill, grist mill, and warehouse were afterwards built. Without going further into the testimony on this part of the case, we think it is proved beyond a reasonable doubt, that the deed of the 27th May was not intended by the parties, at the time it was given, to be an absolute conveyance. Green's defence rests on the truth of his plea. He EMERSON 0. ATWATER. claims to be a bona fide purchaser, without notice of com plainant's equities, under two deeds executed to him by the deputy sheriff of Saginaw county, on the statutory foreclosures of the Rockwell and Little mortgages. Green was not at the sale. Atwater appeared, and either he or Moore & Pennoyer, who foreclosed the mortgages, bid off the property in his name. No money was paid at the time by any one. The mortgages were foreclosed in Green's name, and he claims to be a bona fide purchaser, without notice, from himself; for the sale was his, though made by an officer. If he was a bona fide purchaser of the mortgages without notice, and thereby acquired an interest in the land pro tanto, he could not increase that interest by foreclosing the mortgages, and becoming the purchaser himself. Nor, under the circumstances disclosed by the testimony, can he be considered a bona fide holder of the mortgages without notice. It was Atwater's duty to pay the mortgages. He did pay them, but instead of having them discharged, he took assignments of them in the name of Green. A decree of foreclosure had been obtained on the Rockwell mortgage in the Circuit Court of the United States, and the decree and mortgage belonged to the Michigan Insurance Company. Atwater paid, in cash, and in two promissory notes given by him to the Insurance Company, indorsed by Green and one Palmer, what was due on the mortgage and decree, and had them assigned to Green. A similar process was gone through with in paying the Little mortgage. He paid Little $383.66 cash, and gave him his two promissory notes, indorsed by Green, for the balance, and took an assignment of the mortgage to Green. No one but Atwater was known in either transaction to the holder of the mortgages, and it was on his request the assignment was made to Green. Nor did Atwater's agency, if he was acting for Green and not for himself, stop here. He placed the mortgages in the hands of Moore & Pennoyer to foreclose, and paid them for their |