Fellows v. Loomis

156 Pa. 74 | Pa. | 1893

Opinion by

Me. Justice Williams,

There are twenty-two assignments of error in this case, but they relate to three principal questions. These grow out of an agreement made between Fellows, then the owner of the land in controversy, and Brown, who held a mortgage covering the land. It appears that the tract of laud was subject to an easement, or servitude, in favor of the Delaware, Lackawanna & Western Railroad Company, which gave the company the right to deposit culm upon it. An arrangement had been made between Fellows and the company for a division of the tract, and a conveyance of about one third of it to the company in fee simple, in consideration of the release of the remainder from the servitude. This would give Fellows an opportunity to subdivide the tract into city lots, and enable him to sell them for building purposes, and it would restrict the deposit of culm within fixed and ascertained limits. In order to carry this arrangement with the railroad company into effect, it was necessary to relieve so much of the tract as was to be conveyed to the company in fee from the lien of Brown’s mortgage, and from the right of dower of Mrs. Fellows, who was living at this time apart from her husband. She was approached upon the subject of joining her husband in a conveyance, clearly to the advantage of both of them, of the part of the tract which the railroad company, was to accept as the consideration for the release of the remainder from the right to cover it with culm, but she refused to join. After her refusal he consulted with friends, and obtained legal advice, as to the practicability of carrying out the arrangement without the co-operation of his wife. As a result of such consultation a plan was devised. The mortgage of Brown was to be used to bring about a judicial sale of the tract, to which Brown or some person to be agreed on should take the title, convey the piece the railroad company was to have, to it, and reinstate Brown’s mortgage on the remainder which was then to belong to Fellows.

The questions arising under this agreement between Brown and Fellows may be stated thus: What was the effect of the agreement upon the parties to it ? What was its effect upon the wife of Joseph Fellows ? What was its effect upon Loomis, who was the vendee of Brown, and became the purchaser at the sheriff’s sale ? Proceedings were begun upon the mortgage for the purpose of carrying-this agreement into effect while Brown remained the owner of the mortgage. Before the sheriff’s sale was effected Loomis purchased the mortgage from Brown and proceeded to bring the property to sale. He became the purchaser, He carried out the arrangement by making the conveyance to the railroad company, and securing its release or deed for the remainder of the tract, exactly upon the lines of the agreement made by Fellows; but when he was called upon to reconvey, subject to the mortgage debt, he refused to do so, and, claiming to be the absolute owner of the property, denied the right of Fellows to either the land or an account. This action was brought to determine whether the position so taken by Loomis was tenable.

The first point to be determined relates to the legal effect of the contract between Brown and Fellows for the use of the mortgage, as a means of making title to the railroad company. The position of the plaintiff is that the proceeding on the mortgage was not adverse but for the benefit of Fellows ; and that in making such use of it he became a trustee under the terms of his agreement with Fellows. The learned judge of the court below took the same view of this question, and in an swer to the first point submitted on the part of the plaintiff instructed the jury that the testimony of Brown and Fellows, corroborated by that of Storrs and by the circumstances disclosed by the evidence, was sufficient to establish a trust relation between mortgagee and mortgagor in relation to the property owned by the mortgagee. He went still farther in his answer to the plaintiffs second point, and told the jury, “ If Brown was a trustee he had no right to transfer the judgment,” to Loomis, if the judgment was given to enable Brown to carry out the purpose of his agreement with Fellows, viz., to bring the property to a sheriff’s sale. These instructions left Loomis, the vendee of Brown, in the same relation of trust to Fellows that his vendor occupied, unless he could show himself to be an innocent purchaser without notice, actual or constructive, of the trust. The case was then for the jury upon the credibility of the evidence which the learned judge had told the jury would, if credited, create the trust relation; and upon the position of Loomis as a purchaser at the sheriff’s sale. If he bought with notice of the trust, he took the same title Brown would have taken, and became a trustee for Fellows under the terms of the original agreement.

Notwithstanding this disposition of the first and third of the questions raised, the learned judge withdrew the case from the jury under the view taken by him of the second. He held as a matter of law that the contract between Brown and Fellows was absolutely void, and incapable of enforcement in a court of law, because its effect was to divest the right of dower of Mrs. Fellows, without her consent, from so much of the land as was conveyed to the railroad company. It did not matter in the view of the learned judge that her refusal to join her husband in the deed left the tract of comparatively little value to her husband or herself; nor that her refusal was unreasonable and ill natured; nor that the arrangement made, more than quadrupled the market value of the interest of both her husband and herself in the tract. The mere fact that the arrangement dispensed with her consent, by substituting the lawful mode of procedure upon a mortgage to bring the property to a judicial sale, in the place of the deed of husband and wife, was held to be a fraud of such flagrant character as to deprive the court of the power to restrain or correct the conduct of a trustee, who was alleged to be appropriating the entire trust estate.

It was a conceded fact in the cause that the part of the tract that was to be secured by Fellows was of much greater market value than the entire tract while remaining subject to the servitude in favor of the railroad company. It is clear upon the face of the record that, if there is a recovery in this action, the right of dower of Mrs. Fellows in the land so recovered will be Avorth many times what her right of dower Avas worth before the arrangement with Brown had been made by her husband. Unless there is a recovery her right of dower is absolute^ gone.

The logical result of the ruling in the court below is to punish the husband for divesting his wife’s dower interest in one third of the land without her consent, by extinguishing her dower in the other two thirds. The assignments of error relating to the second question, the effect of the arrangement between Brown and Fellows on Mrs. Fellows, are sustained. This case was improperly taken from the jury. Mrs. Fellows was not defrauded but benefited against her will, if the facts be as they seem to be conceded to be. As to the effect of the arrangement with the railroad company on the value of the two thirds that remained to Fellows, and the fact that Fellows has increased the value of his wife’s dower many times over, against her will or even in the face of her protest, is no reason why the doors of a court of justice should be closed against him and he refused a hearing irpon the merits of his cause of action. We express no opinion upon the facts, for they are before us only as they relate to the legal questions presented. A jury must pass upon them. So far as we can now see, the question on which this case turned upon the trial is not an important one. The first and third questions, i. e. the relation existing between Brown and Fellows under their contract to employ Brown’s mortgage to make title to the railroad company, and so secure to Fellows a portion of his land in a marketable state of the title, and the position of Loomis as assignee of the mortgage, and the purchaser at sheriff’s sale, are the questions on which this case depends, and it goes back that it may be tried upon them.

The judgment is reversed and a venire facias de nove awarded.