*1 April 25, Argued 28; March reversed et ux. v. PROBERT JENSEN et al. 248)
(148 (2d) P. *2 Before Bailey, Justice, Chief and Belt, Rossman, Associate Justices. Lusk Brand, Kelly, George (Rhoten A. Rhoten, of Salem & Rhoten and *3 Speerstra, brief), F. all ap- Sam on Salem, the for pellants. Page, (Page Page, K.
Bollin Salem & of Salem, H. Masters, and Will of Portland, on the brief for and Hemann; Probert W. C. Winslow, of on Salem, the Vick), respondents. for for brief BRAND, J. by plaintiffs, George a
This is suit the Jensen and Eline Jensen, husband and wife, to cancel deeds as plaintiffs’ on clouds the land. title to The decree of the cirсuit court cancelled the deeds decreed that the plaintiff George Jensen is owner in the fee of the premises, imposed portion a it lien but same in the sum of $1,500 favor of the defendant compensation permanent Probert in for the value of the by plaintiffs improvements placed him. The tliereon impressed portion appeal of the decree which that from property. plaintiff the lien on Jensen’s unique. February 17, one 1926, On facts are The property being Egil de- the owner then Olsеn, conveyed plaintiff complaint, it to the in the scribed paid George as the taxes thereafter, owner, who Jensen against property. and assessments George January Jensen 21, 1941,the defendant On plaintiff George enjoyed as the the same name who being enterprising dispo- of an fraudulent Jensen, by convey property warranty purported to sition, George The defendant to Hollis Vick $200. deed right, property. title or interest in had no Jensen appeal and no has court so held been taken circuit George by any by party Jensen, or other defendant unnecessary to is therefore review the It defendant. say except upon that issue that we are in evidence finding the trial court. accord with entire convey purported April Hollis 11, 1941, Vick On by warranty property portion deed to the de- designate shall, Hemann. We for convenience, fendants April portion “Hemann tract.” On 29, as the that convey purported the balance of the Hollis Vick Samuel H. to the defendant Probert wаr- designate portion ranty shall that as the deed. We properly plain- conceded It is “Probert tract.” Vick, Hemann and defendants Probert tiffs nothing faith. There entire acted George title to indicate Jensen record who *4 George Vick was Jensen who deeded to owned property. Hemann and Probert each took out title insuring policies, simple to them fee insurance title. upon the Hemann No have been made by upon plaintiff’s title tract and the cloud reason respectivе properly by of the deeds was removed decree plaintiff G-eorge of the trial court. The is the Jensen in that tract. owner fee of The defendant Probert in faith constructed a small house the Probert to that tract the court also, tract. As cancelled the deeds plaintiff on the as clouds title Jensen, but the decree provided further:
*‘‘* * hereby impressed that there the and be there is premises on lien hereinafter described as the Lien tract Probert in the sum of ONE THOUSAND ($1,500.00) FIVE AND HUNDRED DOL- NO/lOO being lien ; LARS said favor of defendant Samuel being compensation H. Probert for the value permanent improvements placed of the on said Pro- bert Lien Tract defendant Probert, and said sum hereby improve- fixed as the net value of such deducting after ments from the whole value thereof occupancy the value use of the said Pro- period during Lien bert Tract for the which defend- possession H. ant Samuel of.” Probert has been there- plaintiffs knowledge Jensen had no fraudulent conduct the defendant Jensen, nor of any existence of of the deeds to Yick, Hemann or Pro- appear plaintiffs It bert. does that in 1939 the were party G-eorge informed a third that another Jensen property. had be claimed to The de- possession fendant took Jensen never of apparently only upon it on two three occa- sions. last occasion, On the the fall of 1939, he told adjoining Mrs. property, Lentz, who lived on the property, he owned the but admitted that he had no deed. Mrs. Lentz advised that he wrong had the prop- *5 wrong wrоng erty Mrs. number.” lot or block —“the day again the trial. him until the of
Lentz never saw Alaska, plaintiffs Alexander, in Port resided The occasionally of only at the home and visited in Salem They Egil had no knowl- Mrs. father, Olsen. Jensen’s property, edge anyone possession the of had taken any improvements thereon until or had made been September, plaintiff re- Eline Jensen when the had Probert and discovered that turned from Alaska plaintiff’s land. She a small house on constructed attorney thereupon promptly this suit an and consulted plaintiff’s brought from title. remove the cloud was question for decision is this: BBAND, The our J. plaintiff and the owner in fee of the The was Jensen guilty plaintiffs were neither Probert tract. they any negligence, did fraud, or bad faith nor take tending to Probert his affirmative action mislead acting predecessors good purported in title. in Probert, reasonably negligence believing and faith and without himself to be the owner of the Probert built there- tract, imposing in a on a house. Did the court err lien on small plaintiff’s $1,500? for the sum thе land pleadings,
Concerning it should the be added that possession plaintiffs Probert were complaint their was In at the time filed. their tract they attempted complaint, however, at least to invoke prayed for other the aid of and such further and may just equi- court seem different relief as sought also table. The Probert his answer defendant setting and after forth facts the aid claiming concerning prayed title, transaction he if find that for decree that should he a given tract, the Probert he be a not thе owner of decree impressing for full lien amount of the value of the and for the foreclosure objection party, of such lien. Without either the case equity. was tried as suit
By early English common law, American ejectment might the true recover land in his with incurring any liability pay improvements by out though occupier, an even latter acted faith *6 believing 2 himself be the owner. Comm. Kent’s (10th ed.) (by 418; v. 440 Moses, Parsons 16 Iowa J.); App. p. Dillon, Anderson v. 14 D. at Reid, C. 69. 54, early equity, borrowing But as as it that 1829 was held from law, the civil would under some circumstances by allowing soften the harsh rule of the common law compensation by occupier good an inwho faith im proves believing land it to be his own. Bell’s Heirs v. (2 Ky. Marsh). Barnet, 25 516 J. J. (1838)
In Paige, the case of Putnam v. Ritchie, 6 N. Y., Ch. Mr. 390, Chancellor Walworth commented upon the rule the civil law, but held that he was “not principle authorized to introduce a new into the law of legislature.” this without the sanction of the impose upon legal court therefore declined lien possessor for the title benefit of the bona fidе who in good improvements. faith had made beneficial In by ejectment bringing case, however, the owners had legal rights, having stood their strict the issue only by equity raised been cross-bill filed occupant. Since the had equity, owners not invoked impossible apply it the court to the maxim that equity. do he who seeks must rule “The classical is in accord with the still authority weight existing that aside from a except complainant statute and where the seeks permitted assistance, no restitution is 150 because of servicеs in law or which
either land or structures another are beneficial *” * * *7 supra. v. Moses, sons equity of also
The influence has somewhat modi rights in fied the of the true owner even actions at law. ejectment, seeking If in addition to the owner adds a profits, it has been held even in the count for mesne of of statute that the value made absence against may good faith be set off claim for in mesne given profits. is for The reason that action mesne application regarded profits as the Tiffany, (3d Property ed.) assumpsit. 2 Real action of p. § 218 Ill. Tassell, v. 625; 572, Van 75 623, Wakefield supra; Tyler, Moses, Putnam v. 1058; N. E. Parsons 43; Holton, A. 5 Cal. 570, 12 319; 117Pa. Ford Fricke Deposit Pa. 183 38 A. Co., 271, and Trust 601. v. Safe A has more extreme doctrine favoring occupant been in a approved few states which have followed the in the Bright reasoning Justice famous ease Story Boyd, 4 Fed. Story’s Reports 478, 127, Cas. Case No. 1875, and 4 Fed. Story’s 605, 134, Cas. Reports Case No. 1876. That an in Avas suit independent equity an brought by the true owner to occupier against recover compensation valuable im- permanеnt made in faith provements Avhohad no by one notice any defect his title. After that where obseiwing an owner seeks to recover rents and profits, Avill alloAVthe possessor deduct therefrom the full amount of improvements, based on the equitable maxim, court by Story, J. said:
“ * * * But it has been supposed, that Courts of do not, and ought not to go further, and to grant active relief in favor of such a bona fide pos- sessor, making permanent meliorations and im- provements, by sustaining bill, him brought by therefor, against the true owner, after he has re- covered the at premises law. I that find, Mr. Chan- cellor Walworth, Putnam v. Ritchie (6 R. Paige 403, 390, entertained 405), this opinion, admit- at ting the same that time, he could find no case in or England America, where the had point been ex- pressed decided either way. if Now, there be no authority against doctrine, I confess, I should be most reluctant to be the first judge lead to such a decision. It appears to me, speaking all with deference other opinions, the denial of all to such a compensation bona fide purchaser, case, such a where he has manifestly added to the permanent value of an estate by his meliorations Avithout improvements, the slightest suspicion any infirmity title, his OAvn is contrary to the first of equity. Take principles the case of a vacant *8 lot a where a city, bona fide purchaser builds a- enhancing to the value of the estate thereon,
house original land, value of the under a ten times complete; apparently perfect and is it reason- title just, the true case, that in such owner able any possess the without whole, recover and should purchaser? compensation to bona fide whatever unjust inequitable, manifestly and it To me seems appropriate to one man the and thus to money argu- in no default? The who is another, the the owner of the I am that moment house is ment, aware, is, belongs land mere built, it to may certainly possess operation he and that law; merely stating enjoy his But this and own. is by which the true owner law, rule of seeks technical to just had what, sense, in a he never hold, slightest the house. It is not to, is, title answer- objection; merely dryly ing stating, but and admitting But, so then, that the law holds. this to why strong ground equity it not furnish so, be does interpose, grant relief?” should stage litigation, of the same In a later said: “ * * * coming I to conclusion, this wish, to be distinctly affirming maintaining understood as equity, aas doctrine of doctrine, the broad far as so that, purchaser for a an innocent valuable consid- any infirmity notice his eration, title, without improvements and meliorations, his has, added permanent of the estate, value he is entitled remuneration, a full such increase of charge a lien and on the estate, value is which discharge, owner is bound to before absolute he is rights original to his the land. be restored This result of the Roman and it law; the clear has equity, may persuasive I and, add, most common * * *” justice, for its foundation. and common sense Bright Boyd be observed that did It will not depend he the maxim that who seeks must equity. aid for the did invoke the do
153 The a deliberate of decision constituted extension jurisdiction. equitable apply court refused to The (see principle v. follows law Anderson right supra) occupier asserted the Reid, by independent an suit. The rule secure restitution Boyd approved Hardy Bright of v. is followed v. Burroughs, N. 200, 251 Mich. 232 where the 578, W. court said: reasoning plaintiffs may
“The better
is that
maintain
here before us
innocent
It
not
on
this bill.
is
the facts
by
profit
plaintiffs’
that defendants
plain-
mistake,
that defendants take all and
nothing. The
tiffs
relief and therefore seek
fact
defendants need no
ought
none
bar
®* *”
plаintiffs’ right
equity.
to relief in
supporting
Bright
cases
Other
the doctrine of
Boyd
as
are
follows: Schleicher v.
120 Conn.
Schleicher,
Herring
A.
A. L.
162,
182
104
R.
528,
572;
v. Pollard’s
Soper
Ky.
Tenn.
Executors, 23
362;
Foster,
256
157,
(2d)
Murphy
1080;
Benson,
S.W.
With
will consider the Ore
gon
subject.
leading
cases which
to the
are relevant
Briggs (1876),
case in this state Hatcher v.
we a more concerned, as state is far this settle as important question, properly presented gen- Though, considering course, record. equities not fail to bear case, we shall eral *10 relating testimony acts to the to the and mind the respondent.” knowledge of the following in The raised the manner. issues were ejectment brought Briggs, an action for owner, the wrongful damages on and for account of detention. seeking equity, in a de- a cross-bill first Hatcher filed in the the the owner, alternative, cree that he was paid by improvements him made decreed and taxes be Briggs, property if on the it was held to be lien property. Briggs’ This to be court reviewed Bell’s supra; supra; Barnet, Putnam v. Ritchie, Heirs v. supra; Bright Boyd, and Morrison, Hall v. v. Union supra. said: The then we too have deliberation, “After con- mature principles Bright announced in sustaining to follow the cluded Boyd, cases the same and the other justice in consonance with views as more Putnam than in v. Bitchie. the decisions having purchased follows that Hatcher the “It having good regard land reason faith, in thereof at time himself as the owner he erected ejected improvements thereon, should not be compensation improve- therefrom without ments. those regards purchase price paid by Hatcher “As is no that it its full land, for the there doubt was any Briggs re- value. doubt that Neither there proportion from his ceived his full share and thereof permitting guardian. percеive equity in can no We price, purchase him to retain his also to recover the land. share of in addition to Therefore, improvements have value of Hatcher should purchase-money land, his and the him. and the taxes be should also refunded
(Italics ours.) equitable adjustment an “We further think that of the case demands that Hatcher should account Briggs proportion for his of the rental value of of premises controversy, excluding the use permanent improvements during the entire possession time he has been of the land. doWe power think section 318 of the code restricts the ’’ of a court of suit this character. Oregon deliberately placed minority was thus in the Bright Boyd. column with the cases which follow Briggs distinguished Hatcher v. was discussed and Daly, 564, 114 Parker Or. P. 926, 115P. (N. S.) L. R. A. In Daly 545. that ease, delinquent acquired sold for taxes prop and Parker erty brought ejectment. under the sale. tax *11 occupant claimed title under the tax sale and possession purpose recovering adverse and “for the of improvemеnts value of the made in case his fails, title brings alleging inadequacy this suit a cross-bill,” as of long legal remedy, possession improve and of $2,500 enhancing property. ments the value of the The lower occupant found that the court had title, no but that he property. faith had in enhanced the value of the A imposed upon lien was the therefore owner’s land to the of the enhancement. amount This court reversed. The grounds opinion altogether of not the are clear, but the approvаl Pomeroy’s apparent
court cited from with Eq. (5th ed.), p. § 715, 1241, Jud. as follows:
u* * * ejqiier equity aid of of must the a court requisite against be of the the on behalf owner whom claim so that can be made, for reimbursement he equity compelled to do or else there must be some ground in the transaction as of element of fraud * *’ * ’ equitable interference. Again, except * * * [11] While recognition said: Oregon we have no such statute common-law rule, yet - remedy is available either where the compelled to for re- owner been resort has purchaser has been at law; lief or ousted where purchaser, a valuable consider- where any infirmity title, of his notice ation, without may place improvements, he has that the the amount made improvements added the value such have any premises against profits, claim for rents and negligence any or bad faith on the and, if there making recover part in relation the tax the owner purchaser may improvements, the profits.” of the rents and the value thereof excess distinguishes Briggs Hatcher The court Boyd by Bright pointing that in out each case property received value out full therefor owners of the proceeds sale and therefore could not of the void also the land and without retain compensating occupier. It must be conceded that distinguished Briggs be from the case is to Hatcher grounds, upon the same but we think a careful at bar study that the case will show decision of the Hatcher solely upon the fact that had not rest did Daly рroceeds from the void sale. Parker v. received distinguished Daly, from the case at bar in be is to brought ejectment thereby did owner, *12 equity. maxim there- not, invoke aid would may apply. Daly support the fore, v. not broad Parker Bright principles Briggs and of Hatcher Boyd, weight great is with the but it consistent authority, supra, to the effect that when the owner equity, occupier invokes he must do as a condition of relief. To the same effect see Kieffer Company, 90 P. 98 P. 174, 582, Victor Land 53 Or. 877. By quote way summary, Restatement, we frоm p. § Restitution, 167, as follows: 42, changed by “Except to the that the extent rule person statute, a who, in mistaken belief that he person or a he third on whose account acts is the owner, has caused to be made thereby the land of entitled to another, is resti- improve- tution from the owner for the value of such ments ; but if his reasonable, mistake judgment equitable pro- is entitled to obtain in an ceeding for trespass in an or action of or other action only profits mesne on condition that he makеs restitution to the extent that the land has improvements, been increased such value employed for the value of the labor materials improvements, making such whichever is least.” p. And from 170, illustrations as follows: jurisdiction “1. In a in which there is no statute possession A, with thereto, reference of and mis- takenly believing that he Blackacre, owns builds a thereby A house thereon. is not entitled to restitu- tion B, from the owner. except “3. Same facts as in Illustration 1, that B
gains possession brings land a bill remove B cloud on occupancy. title created A’s only upon paying is entitled to relief A the improvements.” value of reasonable *13 Briggs appears The Hatcher to doctrine of v. go beyond forth in the rule as set in the Bestatement permit restitution to the that the Hatcher case would occupier that the maxim who cases where he equity equity apply. must does not While we seeks do authority of no to the that have inclination weaken unnecessary apply it in the think it case case, we is by jurisdiction equity at invoked the bar. Here was jurisdic equity urged If it be was without owner. tion to remove cloud because the tract was in the possession at actual of the defendant Probert the time brought (O’Hara v. 27 Or. P. Parker, 156, suit was 39 Surety Corporation Smith, National v. 168 1004; Or. 203), (2d) (2d) 114 P. 123 P. 266, 118, 265 and by seeking equitable that defendants, also answer any objection jurisdiction waived to the relief, of the jurisdiction upon and conferred chancellor court to complete, equitable Oldenburg Clag relief. render v. gett, (2d) P. 234; 20 Or. Carroll McLaren, supra. P. v. Parker, 233, 118 1034; Or. O’Hara mаjority falls within case, therefore,
The rule plaintiff, if is to and the he receive the aid removing from his must title, cloud make suitable to the defendant on account of restitution question only remaining relates made. char- compensation or which acter of restitution should be particular granted Probert view of the the defendant the instant case. facts of imposition the trial court find
We plaintiff property against the $1,500 of a lien plaintiff power but the court, was within having been faith having in entire acted inequitable stands negligence conduct, guilty of no light before in as fair a as does the defendant plaintiff Probert. do not whether could We know redeem his from foreclosure on such a lien. imposed, disposed If a lien is to be we would be procedure adopted in follow the Hall Union Association supra. provided In Morrison, that case the decree option that the owner should have the to receive from occupier payment just for the lot at its value with- improvements, convey out the owner to the lot to the purchaser, or the owner could hold the lot with the im- provements pay purchaser the actual value of improvements. procedure approved such Such a supra, Chancellor Walworth Putnam Ritchie, Hardy Burroughs, supra. *14 type
There is another of restitution which we present think more under the facts of the by case. The house constructed defendant Probert is ground being small and without a the basement, ex only depth cavated to the of two feet thereunder. We may judicially building susceptible know that such a is difficulty. to removal without serious While we have found that the defendant Probert free from fault negligence, or fact remains that the he made no investi concerning gation contrary, on title, the but the relied upon policy of title insurance in the sum of $1,500 warranty deed his vendor. the of occupier a case in an
This is not which seeks right permanent pro to remove a structure the the over on whose land it The test of the true owner was built. plaintiffs clear. The hеrein make no claim distinction is building by ownership erected Probert. the On of they contrary, they that desire its assert removal. Tonole, Probert cite Trunnell v. The defendants Or. they agree brief and in their P. 628, right improvements if be clear would to remove remedy. seeking affirmatively De- they such a were right plaintiffs objection have no that the is fendants’ remedy to elect that Probert defendant to force by remedy imposed prefers as lien he when by way has held of dictum This court court. the trial require permit power to the re- has buildings land of erected the true owner’s from moval by occupier faith an under and, and in mistake approve peculiar of this case, circumstances we supra. Tonole, dictum. Trunnell of that Equity not bound the harsh rule give would to the common law which any right of reimbursement to the oc without by any cupier. But neither is it bound rule thumb as manner in which restitution should be made. If to the building, rights removal of the direct the we plaintiff the defendant restored, be will be relieved will harsh rule of common law which from the would imрrovements, pursue and he can still his forfeit remedy may policy as he have on his contractual such he can sue for breach of insurance or covenant's of title warranty deed from Vick. in the equities plaintiff Jensen and of The the de- equal. perfect legal Probert are fendant title *15 Rights ownership plaintiff. should not be impaired. lightly encumbered, or divested, find no sufficient evidence We the record from excluding rental Probert tract, which the value improvements, complaint can be detеrmined. The does profits wrongful on account of the not seek mesne occupancy defendant none will be allowed. case is reversed and remanded to the circuit mandatory injunction directions to issue with requiring the defendant Probert to remove the build- ing plaintiff from the within reason- able time to be ascertained and fixed the trial court, plaintiff and to restore land to its former reasonably may condition as near as be. party
Neither costs. will recover of such services. Notes does not know who (American Restatement, on Law Insti Restitution, Armstrong Ashley, p. tute) § v. 204 42; U. S. 272 29, p. v. Ct. 51 L. Ed. Anderson 285, 270, 482; at 27 S. supra; L. 20 Reid, Gibbs, v. How. 15 535, Williams Ark. 143 1013; 191, 102 S.W. Alford, Ed. 905; Folts Dudley 50; 29 E. Par Johnson, Ga. S. supra. Moses, sons firmly it is hand, the other established On authority occupant weight that where the im makes faith himself to be believes provements enhance value of the which relief in a court of true owner seeks where the apply equity, equitable maxim will and the court only upon grant relief to the owner condition will occupier. appropriate to the Tif restitution made ed.) Pomeroy’s Eq. fany, Property (3d §625; Real (5th ed.) p. Notes on 713, §1241; Restatement, Jur. supra; § p. Reid, Anderson v. Par Restitution, 31, 42;