said deed of trust, and that plaintiffs should have the right to procure buyers for all or any part of said land at any time, and that necessary deeds to convey the same would be made by Mary A. Jackson and Robert J. Jackson, her husband, and that the proceeds of all or any such sales should be applied to the payment of the debt owing by these plaintiffs in full or in part. petition, setting forth, in substance: That, same trusts that were set forth in the aforeon the 12th day of February, 1896, they were the owners of a section of land situated in Dunklin county, Mo. (describing it), of the net rental value of about $1,500. That, be ing indebted to defendant Mary A. Jackson for various loans made by her and debts assumed by her amounting to $6,700, they on the 12th of February, 1896, executed and delivered to said Mary A. Jackson their promissory note for $6,700, payable on January 1, 1897, with interest at 8 per cent. per annum, and at the same time delivered to her a deed of trust conveying all of the said 'section of land to R. P. O. Montgomery as trustee for the benefit of said Mary A. Jackson, and which deed of trust in addition to the usual provisions containing the following: "And it is hereby further stipulated and agreed by and between the parties herein that the proceeds arising from the renting of the said land shall, from year to year, and as long as the debt herein mentioned remains unpaid, be collected by the party of the third part, your wife, or her agent, you, and shall be applied as fast as collected as follows: 1st, in payment of the interest of the debt; and, 2nd, in payment of the annual taxes of said land; 3rd, the remainder to be paid on the principal of this debt and so on from year to year until this debt is fully paid." And that on the 1st of January, 1897, they turn over the possession of said land to Robert J. Jackson as the husband and agent of Mary A. Jackson to have and to hold in pursuance of the uses and trusts contained in said deed of trust. That on the 1st day of October, 1896, plaintiffs were the owners of 21 town lots situated in the city of Malden, Dunklin county, Mo. That on the 2d day of October plaintiffs suffered judgment in the circuit court of Dunklin county in favor of the Dunklin County Bank and others for the sum of $345.65 and costs. That an execution upon said judgment was duly issued, and was levied by the sheriff of Dunklin county upon the section of land described in the aforesaid mortgage, and also upon the aforesaid town lots, and sale thereunder advertised for the 17th of March, 1897. That on that day, and before said lands were offered for sale under said execution, the said Mary A. Jackson, by the said Robert J. Jackson, her husband, as her agent and in her behalf, procured plaintiffs to agree to exclude all other purchasers from the sale of said lands, and to permit the sheriff to sell the same in bulk to the said Robert J. Jackson as agent of his wife, Mary A. Jackson, for the nominal price of $1,000, although said land was worth the sum of $35,000. That, to induce such transaction, the said Mary A. Jackson by her husband and agent, Robert J. Jackson, agreed that he as agent for his wife would take a sheriff's deed to the whole of said lands for the said sum of $1,000, and hold them subject to the 144 S.W.-8 Plaintiffs allege that they relied wholly upon these promises and agreements, and permitted the sheriff to execute a deed to the said Robert J. Jackson as agent to his wife, conveying all the lands for the said sum of $1,000. Although there were many prospective bidders present at the time of said sale, the said lands were never offered by separate lots or tracts, and the sum of $1,000 was a grossly inadequate price; that upon the day following said sale plaintiffs surrendered possession of the town lots to the defendants; that the defendants continued to "recognize the trust aforesaid" until the 2d of February, 1898, when they attempted to repudiate the same and to cheat and defraud the plaintiffs by fraudulently conveying by general warranty deed of Robert J. Jackson to his wife, Mary A. Jackson, all the lands described in this petition for the nominal sum of $2,000; that Mary A. Jackson had full knowledge of all the facts alleged when said deed was taken by her; that since the 3d day of February, 1898, the said Robert J. Jackson and Mary A. Jackson refused to account for the whole or any part of the rents received by them on said lands or to apply the same as had been agreed upon to the extinguishment of the indebtedness from plaintiffs to them, but have wrongfully and fraudulently claimed to be the owners in fee of all the lands conveyed by the sheriff's deed aforesaid. The petition then sets out the name of the heirs and children of Robert J. Jackson to whom they have made conveyances of certain interests in said lands, alleging such conveyances were with full knowledge on the part of the grantees of the trusts to which said lands were subject and were taken without valuable considerations. The petition prays the court to set aside the sheriff's deed, and to adjudge the defendants to be trustees of the land thereunder conveyed as shown by the terms of the deed of trust to them and as was agreed between the parties before the sheriff's sale of all of said lands; that all conveyances between Robert J. Jackson and his wife and between them and any of their children be set aside and held for naught; that an account be taken and plaintiffs be permitted to pay any sum that may be due from them to the defendants, and for general relief. Some of the defendant heirs filed general denials. Two of them and the mother, Mary A. Jackson, in addition to general denials, on the farm so that Dr. Jackson could collect them. The next one, October 8, 1896, acknowledged receipt of these contracts and spoke of them as aggregating $1,000, but said the writer (Dr. Jackson) that they were to be $1,500. The other letters were after the set up that the plaintiffs had forborne to take any action to assert any right or claim since the 1st day of January, 1897, at which date they well knew that Mary A. Jackson was in actual possession of said property, asserting ownership thereto, and had made valuable and lasting improvements thereon; sheriff's sale. Thereafter, on July 12, 1897, that the property in question had increased greatly in value since that time by reason of the improvements put on by the said Mary A. Jackson and the general enhance ment of values in that vicinity. The Issues were joined by replication. execution of the trust deeds and the other deeds referred to in the petition was not disputed. The contrariety of evidence relates as to what was the agreement between H. N. Phillips and Robert J. Jackson, acting for their respective wives at the time of the sale of all the land under execution on March 17, 1897. H. N. Phillips testified, in substance, that he and Jackson reached an agreement before the sale that the property should be sold in bulk and bid in by Jackson for $1,000; that he told the sheriff of this agreement, and requested him to offer the property for sale as a whole; that Dr. Jackson's bid for this amount was the only one made, and the land was struck off at once to him; that there were other prospective bidders who were informed of this agreement; that the understanding between himself and Dr. Jackson was this: "That the land included the town lots upon which he had no mortgage, and the whole thing be sold for $1,000, and he was to go on and do as he agreed to do in the deed of trust for $6,700; and, when he paid himself out of the rent of that land, it was to be turned over to us. He was to proceed under the provisions of the $6,700 deed of trust. At the time of the sale he had had possession of the farm land since October the year before. Immediately after the sale the town lots were turned over to Jackson." This witness testified that at the time of the sale of these lands the farm lands were worth $15,000 and the 21 town lots were worth $2,500; that he subsequently received letters from Dr. Jackson bearing upon the agreement had between them at the time of the sheriff's sale of the land. Some of these letters, running through the year 1896, referred to the condition of things prior to the sheriff's sale while the farm lands were incumbered only by deed of trust in favor of Dr. Jackson's wife. The first one, February 6, 1896, referred to the lending of $200, saying, if it was not called for promptly, it would be loaned to another party. The second one, June 2, 1896, and the third one, June 4, 1896, referred to a proposition of some parties from Cape Girardeau to buy the land incumbered by the deed of trust, and asking H. N. Phillips to state explicitly how much money he would want down and other terms of the sale. Another letter of July 11, 1896, contained a request to inclose the crop leases the following letter was sent: "Office of Robert J. Jackson, Physician and Surgeon, Bloomfield, Mo. July 12, 1897. H. N. Phillips, Atty. at Law, Poplar Bluff, Mo.-Dear Friend: I have to-day received an account of the land rented is about 500 acres rented from about $2.75 to $3.00 per acre and I think the land is all rented. I wish you was over and let us see about some plan of work for the future. I want you to write me by return and I will go down and see about the matter and find if any is not rented. Yours as ever, Robert J. Jackson." On the back of this letter was an indorsement of the names of the tenants and the number of acres and the price per acre paid by them, showing 499 acres of land were rented for $1,354.35. Another letter of date August 13, 1897, referred to getting up money for the payment of the "Dexter note," secured by mortgage, which the writer said he would pay and "hold until the papers in the matter were fixed up in full." Another one of date August 17, 1897, referring to the same transaction. Another one dated October 11, 1897, wherein Jackson requested Phillips to inform him whether he desired the land surveyed at a cost of $8, stating that the additional rent would pay more. Another letter dated December 24, 1897, asks instructions of Phillips as to the building a house on one of the town lots at a cost of $150, spoke of having received $806 in rents, and that part of it had been used to pay the "Dexter note and taxes"; that $150 more would be coming, and asked, should that be paid on the house. The letter then said Mr. Bledsoe (a mutual agent employed by the parties after the sheriff's sale) had rented all the lands, but the Dell Thomas 40 for $3 per acre, "and he can rent it at the same price"; and the letter further asks the advice of Mr. Phillips as to building a fence a mile long on the farm, and requested an answer by return mail. The testimony of Mr. Bledsoe, who was put in charge of the farm lands after the sheriff's sale, was, in substance, that he was familiar with the market value of the land in 1897; that it was worth $20 an acre; that the town lots were worth from $100 to $250 a piece, adding: "The reasonable rental value of this farm in 1897 was $3 per acre. I rented it for that. I do not think I have rented over 500 acres. I rented 500 acres at $3 per acre." Adding: "Dr. Jackson came down and went over the land with me. He said that he didn't want to have any more improvements made on the land than was really necessary; that Mr. Phillips did not want any more and he didn't either, but he wanted to see his money back out of this. as he could. As quick as he could get the principal, note and expenses out of the land, he would have to deed it back to Phillips." That witness also asked Dr. Jackson what he would take for the McQuerter land. Jackson replied "that he could not sell it to anybody, that he was holding the land for Mr. Phillips, and could not sell it unless Mr. Phillips agreed to it." Dell Thomas, one of the tenants on the farm, testified for plaintiffs: That he requested Dr. Jackson to build him a house, and he replied to him, "I can't build the house for this reason: Mr. Phillips don't want to be put to any more expense than he can help and I don't either because I want to get my interest and turn the land back to Mr. Phillips." That this conversation took place in the last of March, 1897. That Dr. Jackson and Mr. Mitchim were in a buggy. That the witness gathered his crops for that year, and moved to the lower end of the Mr. Phillips was to have it back and the be paid out as quickly as possible, as quick rents were to be applied on the taxes, interest, improvements, etc. That the rent was to be applied to the debt. That was after the sale." Witness then refers to some improvements, and adds: "I had charge of the land from 1897, in March, to 1899, about December, I think. I collected the rent on the place for Dr. Jackson for the years 1897, 1898, and 1899. I was in charge of the place for Dr. Jackson so far as collecting the rent was concerned. * * * I was put in charge of that place by agreement of Dr. Jackson and Mr. Phillips. I was to collect the rent, and turn it over to Mr. Jackson. They agreed on me to do that. That was on the day of the sale at Kennett after the sale was made." Adding: "These conversations that I had with Dr. Jackson in which it was said that the rents were to be paid by me to Dr. Jackson and that Dr. Jackson was going to let Col. Phillips sell the place occurred along at various times. It was there at Kennett that I first heard of it, and at various other times Dr. Jackson would come down and go out with me over the farm. At one time I asked him what he would take for a certain piece of land. He said, 'I couldn't sell it. I promised to deed this back to Mr. Phillips when I got my money back.'" For the plaintiff, Thomas Bradley testified, in substance: "I heard a conversation just after the sale between Col. Phillips and Dr. Jackson. I think they were in the hall near the sheriff's office, and Dr. Jackson said to Mr. Phillips that he didn't want the land, all that he wanted was his money and the in terest out of it, and they spoke of an agent that would collect the rent and pay it over to Dr. Jackson. The doctor says, 'It won't take many years to pay up.' He said Mr. Phillips was to have the land; that he would deed the land back to him. I was present when the sheriff sold the land. I was deputy sher iff at that time. * There was but one bid for the land, by Dr. Jackson for $1,000. Prior to that bid Mr. Phillips told the sheriff to sell it altogether, the town lots and all, put it all up in block and sell it all. Dr. Jackson was to bid it in; that they had agreed to that effect." He added: "There were other persons there, some of whom told me that they were thinking of bidding, but it was a compromise, and they wouldn't bid at the sale.'" county. Plaintiffs introduced the deposition of Dr. Jackson. This witness stated on cross-examination that he went to Kennett on the day of the sheriff's sale, March 17, 1897, as the agent of his wife; that all he did there was as her agent; adding: "My wife's mortgage One of his then, and he was the man that made the agreement. I just told him, ‘'Judge, if you will guarantee this to me, I will buy the land in question in for two years.' I was to have possession of the farm immediately. After I bought it, I went into possession. I did that." Witness added that there was no agreement as to rents, that his first bid was for $1,000, and that no one bid against him, that he understood that was the amount of the indebtedness; adding: "At any time Hugh Mitchim also testified for plaintiffs, that Phillips wanted the land back within in substance: That he kept a livery stable two years, he was to have it. He was to at Malden, and, when Dr. Jackson came pay me just every dollar that I was out. down, went over with him to show him the There was not a word said about giving him land, with which witness was entirely fa- credit for the rents I had collected in the miliar; that he took him to the different meantime. Q. Then I understand renters, one of whom, Dell Thomas, wanted you that Mr. Phillips at any time within a house built; "that Dr. Jackson replied he two years could take the land all back that could not do this because Phillips did not was sold that day by paying you the $1,000 want any improvements on the land except and pay the $6,700 due to your wife, with inwhat was absolutely necessary to cultivate terest on that account. A. And any other it. He didn't want any improvements put indebtedness whatever it might be. Q. Well, on the land because he wanted the land to what other indebtedness was talked about? * A. Well, there was several little debts that he owed me besides, some of them very small and some of them not so small. Q. Then you have been willing all the time to collect what money you and your wife had been out on this land and make a deed back to the Colonel for the land? A. No, sir; I am not willing now, He has let it run too long. The land is not mine at the present time. My son-in-law, Ed. Moore, owns one half of it, and my daughter, Myrt Jackson, owns the other part. The lots not conveyed are in my wife's name." He added that he could not tell when these deeds were made, but they were before the present suit, adding: "It is a part of my estate. I have divided all the lands I had among my children, and it is part of my estate. It was simply an advancement by myself and my wife to my children." He also stated that he had never entered satisfaction on the records of the note for $6,700 and the deed of trust securing the same; that he paid the $1,000 to the sheriff out of his wife's money, and she agreed to abide by any agreement that he made. He also stated, "I believe to the best of my opinion that this two year arrangement was agreed upon before the sale;" and further, "I have used the money collected as rents on this land over and above improvements and taxes as my own property." For defendant, J. G. Wear testified that on the day of sale during the session of the circuit court of which he was judge at the time, with the assent of Mr. Phillips, he called on Dr. Jackson to get him to buy in the land, and explained to him that he thought he would be safe in doing so, and that he thought Phillips could pay it off in a year; that Jackson replied, "I will give him two years; if he can redeem in two years, he can have it;" that this witness went back and told Phillips what Jackson had proposed to do, and said that was the best that could be done. Witness knew nothing about any further agreements between the parties. At the time of his testimony he said he had been retained by defendants as an attorney in the case and was also a wit ness. Defendants read the depositions of R. H. Jones, who drew up the sheriff's deed at the time of the sale of the land, March 17, 1897, and who testified that he was paid for this by Dr. Jackson, to whom he delivered the deed, finding him at the time in the sheriff's office in company with Mr. Phillips; that, when he spoke of his business (to deliver the deed), he was asked to wait until an agreement between them was made, adding: "As best as I now remember, Mr. Phillips was wanting time in which to redeem from Dr. Jackson on the land that was described in this particular deed. Dr. Jackson was insisting on receiving his money, that he did not want the land, but he could not give him the time to redeem the same that Mr. Phillips was wanting. Mr. Phillips asked him if he would not give him five years, I think it was five, in which to redeem it, and the doctor refused to do it, but offered to give Phillips one year. Mr. Phillips told the doctor that was not what he had agreed to do before he purchased the land, and that he was trying to hold him up. For some little time after that the discussion was pretty warm between them, and Dr. Jackson finally said he would give him two years in which to redeem the land, and not any more. The doctor paid me what was due. I delivered the deed and left him and Mr. Phillips in the sheriff's office disputing over the matter." The trial court made a finding of facts and law, and dismissed the petition for the reason that plaintiffs, in his opinion, had failed to make out their case with that degree of certainty required, and that, if they had, they would be debarred by laches. From this decree plaintiffs perfected their appeal to this court. Charles G. Revelle, D. W. Hill, E. R. Lentz, and Sam M. Phillips, for appellants. E. A. Rozier, N. A. Mozley, and Ralph Wammack, for respondents. BOND, C. (after stating the facts as above). 1. Prior to the sale under execution of all the lands described in this suit, the respective interests of plaintiff and wife on the one hand and Dr. Jackson and wife on the other were fully defined by the terms of the trust deed executed in February, 1896, and the parties thereto had the rights and were subject to the duties prescribed in that instrument, and no others. The important question, therefore, is: What change was created by the transactions through which Dr. Jackson got the sheriff's deed to the mortgaged property and some 21 town lots, embraced in the mortgage? [1] There is no room under the facts in this record for the application of the technical doctrine of merger of two titles. That rule is upheld in equity when it accords with the intention of the parties, but it is neither upheld in equity nor at law unless two titles, a greater and a less, have coalesced in the same person. In the case at bar the deed of trust on the farm was to a third party for the benefit of Mrs. Jackson, and the sheriff's deed was made to R. J. Jackson; hence there was no merger, and this point may be excluded from view in the further discussions of the case. leaves the transaction with only three possible aspects: Was it a conditional sale, an equitable mortgage or a constructive trust arising out of the wrongdoing of the purchaser? The equitable principles governing these three subjects are clear and fixed. They have been repeatedly announced by this court. This [2] Whether a given state of facts consti tutes a conditional sale of land vesting the ty, Mr. Bledsoe, who was in charge of it imtitle in the buyer, subject only to a right on mediately after the sale to Dr. Jackson, statthe part of the seller to rebuy within a specified time, depends upon the intent that this should be so, and the extinguishment of all indebtedness, past, present, and future, between the parties; for, if any indebtedness between them survives the transaction, or if it is intended to secure a present loan, or to provide against future liability, then the transaction is ipso facto an equitable mortgage, however absolute may be the form of the conveyance. [3] If the evidence afforded by the instrument and the attending facts and circumstances leaves it in doubt whether a sale with a right of repurchase or an equitable mortgage was intended, courts of equity will resolve this doubt in favor of the creation of a mortgage. The character of the transaction is determined in its inception. If it was a mortgage in the beginning, it remained so. If a conditional sale at the start, no lapse of time will change it into a mortgage. 3 Pomeroy's Eq. Jur. §§ 1193-1197, et notes; Jones on Mortgages, §§ 264, 265, and 272; Turner v. Kerr, 44 Mo. 429; Reilly v. Cullen, 159 Mo. 322, 60 S. W. 126; Reilly v. Cullen, 101 Mo. App. 32, 74 S. W. 370. ed that Dr. Jackson explained to him that no more improvements must be made than were necessary, for Mr. Phillips "was to have it back and the rents were to be applied on the taxes, interests, improvements, etc., that the rent was to be applied to the debt." Under this state of facts the conclusion is irresistible that the transaction in question was not an absolute sale of the property based upon the extinguishment of all indebtedness between the parties, leaving the plaintiffs the mere right of repurchase within two years. 2. Was it an equitable mortgage? The circumstances surrounding the transaction of purchase at the sheriff's sale were, in brief, these: Jackson's wife held a note of plaintiff's for $6,700 covered by deed of trust on their farm. The equity in these lands had been levied upon under an execution which was also levied upon 21 town lots. Jackson admits he agreed before this sale to buy in the property and give plaintiffs two years to redeem. He bought it for the price fixed by agreement at one bid. It was sold in a lump, no other bids being made. Immediately on getting his deed he took possession and [4] In the case at bar there is no dispute placed a man (Bledsoe) in charge. He never that the amount of the bid to be made at the surrendered the note to plaintiffs nor canexecution sale on the property was fixed by celed the deed of trust securing it. He statagreement at $1,000; that the property was ed to Bledsoe, to the tenants, and to other purchased at and for that sum upon one bid. persons, that the land must be worked as The amount of the execution was about $400. economically as possible, because the "rents The surplus of this bid is not claimed to must be used to pay the interest, taxes, and have been paid to the plaintiffs or either of principal debt due him and that he must then them. The plaintiffs contended that it was deed the property back." In his letters runto be applied to an indebtedness on their ning through a year after his purchase, he part to the Dexter Bank of about $456. It counseled with Mr. Phillips as to the vaappears from a letter written by Dr. Jack-rious steps to be taken in the cultivation son that this was subsequently done, for in and improvement of the land and the collechis letter of August 13, 1897, he spoke of tion of rents. To our minds the proof as to paying that debt, adding that he would "hold these facts is positive and convincing; and, the papers until the matter is fixed up in resting largely on the written statement of full." This was five months after he had 'Dr. Jackson, it leaves no doubt but that he acquired the deed to the property at the intended at the time to hold the property sheriff's sale. It is not claimed in this case under the sheriff's deed for the purpose of that any note representing the previous in- security and repayment of the note for $6,700 debtedness of the plaintiffs to Dr. Jackson and the amount $1,000 which he bid for the and his wife was given up or surrendered lands. This being his intention, as well as or paid at the time of this purchase under the intention of the plaintiffs, at the incepthe execution sale. On the contrary, any tion of the transaction, its character as a and all evidence of debt which ever existed mortgage was thereby ineffaceably stamped in their favor against the plaintiffs is, as upon it under the settled rules of law. The far as this record shows, subsisting yet. result was that he became trustee of the Again, it appears from the positive statement town lots under an equitable mortgage; and of several witnesses that immediately after the sheriff's deed to him, in so far as the the acquisition of the sheriff's deed Dr. Jack-town lots are concerned, became in the eye son to them and in their presence stated that of a court of equity a mortgage on them he could only make such repairs as were nec- to secure any and all the indebtedness from essary to the cultivation of the land or to the plaintiffs to himself and wife. The mortsecure rent of the town lots, since Mr. Phil-gage was created by the acts, and in accordlips did not want any other expenses to be ance with the intention of the respective parincurred in order that the indebtedness due to Dr. Jackson should be paid as soon as possible, and the property deeded back to Phillips. Again, the manager of the proper ties of necessity remained a mortgage, and the deeds from Jackson to his wife and from them to their children, by way of advancement, did not carry any further title than |