Edwards v. Barnes

| Mass. | Dec 8, 1896

Barker, J.

An examination of the instruments of August 1, 1877, called in the report a trust deed and defeasance, shows that they do not constitute a mere mortgage, but give the title to Jacob Edwards in trust to sell the lands and to reimburse himself out of the proceeds. The sales made since the death of the grantor have been made upon this footing, and the proceeds have been applied to the extinguishment of the debt due to Jacob Edwards. These proceeds were in fact money of the trust, and not of the estate of the grantor ; and the appellees are not chargeable with them in their executors’ account, if they have the right to regard the trust as valid. See Keith v. Molineux, 160 Mass. 499" court="Mass." date_filed="1894-02-27" href="https://app.midpage.ai/document/keith-v-molineux-6424829?utm_source=webapp" opinion_id="6424829">160 Mass. 499. As there was an existing debt due from the grantor to Jacob Edwards when the trust deed was made, and as subsequent advances were made as contemplated, the conveyance was for a valuable consideration, and was not void as in fraud of creditors. The appellant’s contention is, that because the deed was not recorded until after the death of the grantor, the lands conveyed were lands which were “ liable to attachment or execution by a creditor of the deceased in his lifetime,” and that therefore, by the operation of Pub. Sts. c. 134, § 2, they could be sold by the accountants for the payment of the debts of their testator, notwithstanding the conveyance.

It is true that up to the death of the grantor these lands were liable to attachment or execution by any of his creditors who had no notice of the unrecorded deed. But it seems to be a general principle founded upon justice, that lands of which the apparent record title stands in a debtor, but which in fact do not belong to him, can be taken in payment of his debts only by individual creditors. See Smythe v. Sprague, 149 Mass. 310" court="Mass." date_filed="1889-05-11" href="https://app.midpage.ai/document/smythe-v-sprague-6423158?utm_source=webapp" opinion_id="6423158">149 Mass. 310, and cases cited. Language substantially similar to that of Pub. Sts. c. 134, § 2, is,used in Pub. Sts. c. 157, § 46, as to the property of an insolvent, namely: “ The assignment shall vest in the assignee all the property of the debtor . . . which might have been taken on execution upon a judgment against him.” In Smythe v. Sprague it was held that, under this provision, land conveyed by an insolvent for a valuable consideration to a Iona fide purchaser by a deed not recorded until after the assignment in insolvency was not property of the debtor, and did not pass to the assignee. The decision was upon the ground that a creditor with no notice of the deed has the right to take the land on execution, not because it is the property of the grantor, but because the grantee, in violation of the registry laws, has failed to record his deed, and thereby has committed a constructive fraud upon the creditor, and is therefore estopped to set up his title against him; that this right is a personal right of the creditor which enures to his own benefit solely ; that the grantee by recording his deed may, without any other conveyance, perfect his title; and that, if the statute should be construed to vest such property in the assignee, it would unjustly vest in him, not the property of the insolvent, but that of his grantee.

The same considerations apply to an unrecorded conveyance made by a person who dies before his deed is recorded, and compel a similar construction of the statute authorizing sales of lands of a deceased person for the payment of his debts. The title passes in each case, and in each no one but an attaching creditor has the right to contend that the grantee is estopped from setting up his title, and in the case of a deceased person it would not be the lands of his estate which would go to pay his debts, but the lands of his grantee. Whatever may be the power of an executor or administrator in a case where a creditor has attached the lands during the life of the grantor, in a case like the present, where there was no such attachment, the executors have no power to sell the lands which their testator had in fact conveyed by the unrecorded deed.

Decree of Prohate Court affirmed.