From the chancery court of Warren county.

Hon. William C. Martin, Chancellor.

Sophia Peterson and others, appellees, were the complainants in the court below; Fultz and Purnell, appellants, were defendants there.

The controversy grew out of this state of facts: A Mrs. Thompson and another formerly owned the land in controversy, it being situate on an island in the Mississippi river, known as Belk’s island. They leased the same for a term of years to one A. Peterson, the ancestor of complainants. Peterson, the tenant, being in possession of the land, about the time of the expiration of his lease, desired to own the same and negotiated a purchase thereof from Mrs. Thompson and her co-owner. He agreed to pay them $1,200, but, having only $200 with which to make payment, he applied to Guthrie & McMillan, a partnership, for a loan of $1,000, with which to pay the balance of the purchase money, and they loaned him that sum under an agreement that the title should be taken in their names as security for the loaned money. Peterson then consummated the purchase, paying his vendors the $1,200, of which he had borrowed-, as aforesaid, $1,000, and took the deed, as he had agreed to do, in the name of Guthrie & McMillan. He was the real purchaser, and was at the time in the possession of the land, and he remained in possession a number of years thereafter, during which time he made various payments to Guthrie & McMillan on the loan, and they rendered him written statements showing that the payments received were on account of Belle’s island land purchase, etc. The island was overflowed some years after Peterson’s purchase, and he temporarily left it, but, soon after the water subsided, he placed a tenant on the land. Guthrie & McMillan caused this tenant to pay them rent,. and sold the land to appellants, who had notice of all the facts. The appellees took possession. Complainant’s ancestor, Peterson, having died intestate, they inherited his rights and began this suit, seeking to have the absolute deed executed by Mrs. Thompson and her co-owner to Guthrie & McMillan declared to be a mortgage, defendants adjudged trustees of the legal title for complainants’ benefit, and for an accounting of payments and rents, so as to reedeem from the mortgage, etc.

The court below decreed in complainants’ favor and referred the matter of the accounting to a master, who reported that the loaned money debt to Guthrie & McMillan, for which the deed from Mrs. Thompson and another was a mortgage, had been fully paid and that defendants were indebted to complainants on account of rents. The master’s report was confirmed, over exceptions of both parties, and the defendants were ordered to execute deed to complainants and pay them the sum due as found by the master. The defendants appealed to the supreme court.

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