Lenman v. Jones, 33 App. D.C. 7

33 App. D.C. 7 | D.C. Cir. | 1909

Mr. Justice Van Orsdel

delivered tbe opinion of the Court:

Counsel for defendant rely upon tbe following assignment of errors:

“Tbe court below erred:

“1. In bolding that tbe so-called contract sued on was an enforceable written agreement by tbe appellant to sell tbe land described in it to Fannie E. Wilhoite.

“2. In bolding that tbe appellee and those under whom he claims had not, by their conduct leading up to the execution of that instrument, precluded him from obtaining in equity tbe relief afforded him by tbe decree which is tbe subject of tbis appeal.

“3. In bolding that tbe original vendee in tbis case, Fannie E. Wilhoite, and tbe appellee as claiming under her, were not precluded from maintaining a suit in equity for tbe enforcement of tbe alleged contract by tbe fact that she bad resold the property at an advanced price, thereby fixing tbe amount of damages sustained by her, and putting them to their remedy at law.

“4. In not bolding that tbe National Savings & Trust Company was tbe real party in interest in bringing tbis suit, and that public policy forbids its obtaining a decree in its favor.

“5. In bolding that tbe evidence proves that tbe appellee is tbe assignee of Fannie E. Wilhoite under said alleged contract, and that, as such assignee, be is entitled to maintain tbis suit.

“6. In not dismissing tbe bill of complaint as to tbe appellant, Isobel H. Lemnan.

“7. In requiring the appellant to execute and deliver to the appellee a deed conveying to him the real estate in question.”

Without considering the assignments of error separately, we think this case can be disposed of under a few general propositions. The contract of May 2, 1905, is assailed by counsel for defendant on the ground that it does not constitute an enforceable agreement of sale of real estate. Section 1117 of the Code of the District of Columbia provides: “No action shall be brought * * * upon any contract or sale of lands, tenements, or hereditaments, or any interest in or concerning them, * * * unless the agreement upon which such action shall be brought, or some memorandum or note thereof, shall be in writing, which need not state the consideration, and signed by the party to be charged therewith or some other person thereunto by him lawfully authorized.” [31 Stat. at L. 1367, chap. 854.]

In Grafton v. Cummings, 99 U. S. 100, 25 L. ed. 366, the court declared the essential elements of a contract or agreement in writing under the statute of frauds to be, “that it shall contain within itself a description of the thing sold, by which it can be known or identified, of the prices to be paid for it, of the party who sells it, and the party who buys it.” In Salmon Falls Mfg. Co. v. Goddard, 14 How. 455, 14 L. ed. 496, the court, upholding a memorandum agreement, said: “The memorandum, therefore, contains the names of the sellers, and of the buyer; the commodity and the price; also, the time of credit, and conditions of the delivery; and, in the absence of any specified time or place of delivery, the law will supply the omission.”

Applying these rules to the case at bar, we have here an instrument which, on its face, purports to be a receipt for $100, paid upon the purchase price of certain real estate therein specifically describedj the terms of the sale of which are set forth in the instrument. This paper contains a description of the property; the consideration; the manner in which payment is to be made; the security for the deferred payments, with the rate of interest thereon; and the time within which the vendee is to make the cash payment and execute the securities for the balance. The document is signed by the agents of the purchaser. To this point, the name of the vendor is not mentioned, but the instrument is signed under the words “confirmed, ratified, and approved” by “Isobel H. Lenman (owner)” and by “Fannie E. Wilhoite (purchaser)” the purchaser signing both personally and by Early & Lampton, her agents. These signatures appear to the left and immediately under the body of the instrument, and confirm, ratify, and approve the contents of the document itself. It would be absurd to hold that they do not refer to the paper to which they are attached, and of which they are a part. We must, therefore, consider the instrument as a whole. The signatures are necessary, both to indicate the buyer and seller and to give authenticity to the instrument. The agreement may be searched in order to ascertain who the parties axe. As the court said in Barry v. Coombe, 1 Pet. 651, 7 L. ed. 301, referring to the signature to a contract, “it does not signify much in what part of the instrument it is to be found.” We find no difficulty in holding this instrument, when considered as a whole, and in view of the evident intent of the parties, to be such an agreement of sale as will support an action for specific performance. It is, therefore, unnecessary for us to pursue the discussion of this branch of the case. The instrument before us is sufficiently full and complete to meet every requirement of an agreement of sale essential to call for specific performance.

But it is insisted that this agreement cannot be enforced because the person signing it and purporting to be the owner was not, in fact, the owner, and had, therefore, no authority to contract for a sale of the property in question. On this point, both defendant and her mother testified thát it was the intention of John T. Lenman, expressed shortly before his death, that the property in question should go to his wife, and certain other property should go to defendant. We think it neither necessary nor profitable to enter into an extended review of the evidence on this point, further than to refer to one fact in that connection. Both the defendant and her mother testified that, shortly prior to his death, John T. Lenman made certain written memoranda, in which he indicated the division he desired made of his property between the defendant and her mother. When called upon to produce this memoranda, defendant produced one document in the handwriting of her father, in which he indicated it to be his desire that defendant should have certain property therein named, including “6 houses, New York Ave.” It is conclusively shown by the evidence that the six houses above referred to included the property here in controversy. We think that a fair consideration of the evidence leaves no doubt as to the legal status of the defendant and her mother with relation to the property in question. No disposition was made by the husband and father during his lifetime that would operate as a specific devise of this property, and no arrangement has since been made between the mother and daughter that could be held to effect a change or conveyance of the title as fixed by law on the death of the intestate.

The record discloses that John T. Lenman died intestate in 1892, seised of the property in question, leaving the defendant as his sole legal heir. The legal title to the property descended to and vested in the defendant, subject alone to the widow’s dower therein. Plaintiff is here insisting upon defendant performing her contract in so far only as she is capable. By the decree, the dower interest of the mother is protected. It perpetrates no hardship upon her. It only directs the defendant to carry out her agreement to convey the legal estate which vested in her on the death of her father. In Harding v. Parshall, 56 Ill. 219, the vendors had contracted to give a conveyance with general warranty. They attempted to defend in a suit for specific performance on the ground that they could not give a good title. On this point the court said: “Can they now insist that, because they do not have such title as they agreed to sell, that they are exonerated from the performance of their contract, and that Parshall shall only have a restoration of his money? It is clear, beyond question, that appellant and Paullin could not compel Parshall to perform the contract unless they could show that they were able to convey such a title as they' had contracted to give. But in this case he is willing to risk their title and receive it as they hold it, with the covenants they agreed to make. That such is the rule of law seems to be apparent. Otherwise a party would have the right to insist on a rescission simply because he was unable to perform his agreement. When parties enter into contracts they know that they do not have the option to rescind without the fault of the other party. This all business men know, and contract with a view to such a liability. The party who has performed or offered to perform 'his part of the agreement has the choice whether he will sue for and recover damages for a breach of the contract, or will insist upon its execution specifically, and take such a performance as the other party is capable of making.” The case at bar is much stronger than the case cited, for the defendant only contracted to convey by special warranty, and that is all she is asked to do, or required to do, by the terms of the decree.

We are'not impressed with the contention that the vendee Wilhoite must be considered as a mere dummy in this transaction, and not as the real purchaser. While we have little doubt that she was used by Early & Lampton for the purpose solely of a disinterested party through whom the title could pass, yet we must be bound by the written instruments appearing in the record and evidencing the various transactions forming the basis of this controversy. The record will not permit us to'treat the original purchase as one by Early & Lampton as agents for Jones as an undisclosed principal. It may be suggested that, if this were true, it would not improve the situation so far as the defendant is concerned. It is well settled that an agent may enter into a contract for the purchase of real estate for an undisclosed principal, and that such principal can enforce specific performance of the contract against the vendor. In Kelly v. Thuey, 143 Mo. 438, 45 S. W. 300, the court said: “It is very familiar learning that the agent may enter into a contract for the purchase of land for an undisclosed principal. And the principal may maintain a suit in his own name and enforce the contract, it being immaterial whether the principal was known, or unknown during the transaction, or whether the party supposed he was dealing with the agent personally and on his own behalf.” In Pomeroy on Contracts, 2d ed. sec. 89, page 128, it is said: “When the agreement is executed by an agent in his own name, he appearing to be the contracting party, the requisite as to parties is complied with. The principal may maintain a suit and enforce the contract, and it is immaterial whether the principal was actually known during the transactions, or whether the other party supposed that he was dealing with the agent personally, entirely on his own behalf. Under the same circumstances, it is now the rule that a suit may be maintained, and the contract enforced against the principal, even though his name nowhere appears on the face of the writing, and even though he was undisclosed and unknown to the other party at the time of entering into the agreement, provided, of course, it was actually made on his behalf.”

Dismissing the above contentions, we come now to the one most difficult, and which we think must govern in this case,— the transactions between Wilhoite, the original vendee, acting through her agents, Early & Lampton, and the plaintiff. These negotiations are evidenced by the two instruments in writing of May 3d and May 25th. The negotiations must be treated in their entirety in order to ascertain the nature of the conveyance actually made to plaintiff, and the character of title he is here asserting. The deed of May 25th must be considered as supplementary to the contract of May 3d. Regarding the whole transaction in this light, it can only be considered as a sale of the property, and not as. a technical assignment of the rights of the vendee under the original contract. The agreement of May 3d is an express contract of sale of the property, without any reference whatever to the original contract. The deed of May 25th, which we think sufficiently executed .to be a binding conveyance between Wilhoite and the plaintiff, is a deed of conveyance of the property. True, it contains the following recital: “The said Eannie E. Wilhoite has assigned her said purchase and all her interest in and to said land and premises, unto Thomas R. Jones, in evidence of which assignment 'the said Fannie E. Wilhoite has become a party to and executes these presents; and the said Thomas K. Jones, having fully complied with the terms of said sale, is entitled to this conveyance.” This recital can only refer to the former agreement of May 3d. We must then look to that agreement, and not to the recital, to ascertain the intention of the parties. No reference is there made to the original contract; and it cannot, therefore, be distorted into an express assignment of that contract. The record discloses no transactions or negotiations between Wilhoite and the plaintiff, except as evidenced by these two instruments. The deed was the completion of the sale as agreed upon in the contract, and not an assignment in express terms of the original contract. There is no such an assignment disclosed by the record before us.

Treating the original contract as an agreement for the sale of the property in question between the defendant as the owner and vendor and Fannie E. Wilhoite as the purchaser and vendee, and Early & Lampton merely as the agents for the vendee, can the plaintiff, as a subpurchaser from the vendee, enforce specific performance of the original contract against this defendant? With the signing of this agreement, the equitable title to the property passed to the vendee, and, therefore, defendant, as vendor, held the property as trustee for Wilhoite, the purchaser. As this court said in Griffith v. Stewart, 31 App. D. C. 29, when considering a contract for the purchase of land: “We are of the opinion that, as to the particular part of the- estate of Ball involving the land in question, the sale effected a conversion, and thereafter Ball held the land as trustee for defendant; that, upon the execution of the contract, Ball’s interest, as represented by the unpaid balance of the purchase price, became personalty, or a chose in action, and passed to the plaintiff executor as such. * * * Under the sale, the land became the property of the defendant, and the agreed purchase price became the property of Ball. In equity, Ball held the land as trustee for defendant, and defendant held the purchase price as trustee for Ball.” This rule is too well established to call for further citation.

It follows that, the equitable title having become vested in Wilhoite, the legal title only remaining in the defendant, Wilhoite could convey it, encumber it, contract for its conveyance, or dispose of it in any way that she could if the legal title had actually passed to her. There seems to be no lack of authority in support of this principle. In Pomeroy’s Equity Jurisprudence, vol. 1, sec. 368, it is said: “As the vendee has acquired the full equitable estate, — although still wanting the confirmation of the legal title for purposes of security against third persons, — he may convey or encumber it; may devise it by will; on his death intestate, it descends to his heirs, and not to his administrators; in this country, his wife is entitled to dower in it; a specific performance is, after his death, enforced by his heirs; in short, all the incidents of a real ownership belong to it. As the vendor’s legal estate is held by him on a naked trust for the vendee, this trust, impressed upon the land, follows it in the hands of other persons who may succeed to his legal title, — his heirs and his grantees, — who take with notice of the vendee’s equitable right. In other words, the vendee’s equitable estate avails against the vendor’s heirs, devisees, and other voluntary assignees, and his grantees with notice.” In Lewis v. Hawkins, 23 Wall. 119, 23 L. ed. 113, the court said: “Upon the execution of the notes and the title-bond between Lewis and Hawkins, Lewis held the legal title as trustee for Hawkins; and Hawkins was a trustee for Lewis as to the purchase-money. Hawkins was cestui que trust as to the former and Lewis as to the latter. * * * The equitable estate of the vendee is alienable, discendible, and devisable in like manner as real estate held by a legal title.” It would seem, therefore, that the vendee Wilhoite had the power to enter into the contract of May 3d with plaintiff and agree to convey to plaintiff all her interest in the property in question which she acquired under her contract with the defendant, and plaintiff thereby succeeded to all the rights of the original vendee, Wilhoite, with power to enforce the specific performance of the original contract against the defendant. In other words, regarding this transaction as a resale, and plaintiff as a subpurcliaser, it results that plaintiff must be considered as the equitable owner of the property, with defendant as a mere trustee of the legal title, under a trust to convey it to plaintiff upon his compliance, or tender of compliance, with the terms of the original contract of sale.

But it is contended by counsel for defendant that there is no such privity between plaintiff and defendant as will support an action for specific performance. With this we cannot agree. We are cited to the case of Stratton v. California Land & Timber Co. 86 Cal. 353, 24 Pac. 1065, which holds that an original vendee under a contract for sale of land cannot, by making a resale to a third party, create such a privity between his vendee and the original vendor as will entitle the former to maintain an action for specific performance against the latter. This case, however, is opposed to the great weight of authority. The right to specific performance in cases similar to the one at bar does not depend upon the privity of the parties, but upon the character of title acquired by the original vendee, and his power to confer the rights thus acquired upon his vendee.

In Buchannon v. Upshaw, 1 How. 56, 11 L. ed. 46, the complainants and those claiming under them purchased from one Buckner, paid a full price, and took deeds for the property in controversy. Buckner had purchased from one Shackleford, who had no title to or interest in the land, Upshaw, the defendant, being the owner. Later, Shackleford and Upshaw entered into two separate contracts confirming the contract between Shackleford and Buckner. On this, the court said: “By these contracts alone Upshaw was bound, and on them the bill is founded, and a specific decree asked. They must be taken together; so the complainants treat them in their bill; nor can the court do otherwise.” Quoting further from the opinion: “We also hold that there was privity of contract between Upshaw and the complainants. When he sanctioned Shackleford’s contract with Buckner, he became a party to it; Buckner had assigned all its benefits to the complainants, and they must be treated as rightful assignees; with the modifications imposed by the contracts of 1801 and 1803, between Upshaw and Shackle-ford. The equitable title being in the complainants by a contract complete in all its parts, they are entitled to a specific decree, of course, on principles too familiar to require authorities to support them. On this part of the case the court has had neither doubt nor difficulty in arriving at a conclusion favorable to a specific decree.” In Randolph v. Wheeler, 182 Mo. 145, 81 S. W. 419, Randolph, the complainant, purchased land from one Darrell, who had previously agreed to sell it to the defendant, Wheeler. This suit was brought by Randolph, as the vendee of Darrell, to enforce specific performance of the contract between Darrell and Wheeler. Darrell was not a party to the suit, the court holding that the complainant, by the conveyance from Darrell, “accepted the same burdened with all the equities which appellant was entitled to assert under the contract of sale, and, on the other hand, by such conveyance, she acquired all the equitable rights possessed by her grantor, and in a court of equity can aassert and maintain them.” In Hunt v. Hayt, 10 Colo. 278, 15 Pac. 410, where the vendee in the original contract conveyed the property by quitclaim deed to a third party, who brought an action for specific performance against the original vendor, the court said: “Such equitable interest may be assigned by the vendee or party who stands in the position analogous to that of the vendee, and the assignee may maintain an action to compel a specific performance of the contract. Pom. Spec. Perf. sec. 487; Waterman, Spec. Perf. sec. 68; House v. Dexter, 9 Mich. 246. The quitclaim deed from Mrs. Rupe to the plaintiff conveyed by assignment the equitable right of Mrs. Rupe in the premises, and all her rights under the contract with Hunt. Miller v. Whittier, 32 Me. 203; Currier v. Howard, 14 Gray, 511; Bradbury v. Davis, 5 Colo. 265, 269; Fitzhugh v. Smith, 62 Ill. 486. In the case last cited it held that the effect of a deed is made to depend rather upon the intention of the parties than upon the form of the deed.”

It would seem that courts of equity make no distinction between the right of the assignee of the vendee of an original contract, and the vendee of such person by purchase, to enforce specific performance against the vendor in the original contract, the deed of conveyance operating not only as a conveyance, but as an assignment of all the equitable interest in the property held by the vendee under the original contract. In other words, the right of specific performance depends not so much upon privity between the parties, although the court in Buchannon v. Upshaw, supra, held there was privity between such parties under a deed of conveyance, as upon the right of the vendee to sell, encumber, convey, or contract for the conveyance of the property in which the equitable title has become vested by virtue of the original contract.

It is contended, however, that Wilhoite should have been . made a party to this action. In the cases just cited, the intermediate vendee and vendor was not held to be an essential party, but, in other cases to which our attention has been called, it has been held that such person is an essential party in an action similar to this for specific performance. While our attention has been called to no fixed rule on this subject, we think the particular circumstances of each case should govern. The object in requiring an intermediate party to be made a defendant is to protect both the plaintiff and defendant against any future liability to the intermediate party. Where it is apparent to the court that no such liability can occur, it will not refuse to decree specific performance for such a defect of parties. It is difficult to understand just how the defendant can be damaged by the failure of Jones to make Wilhoite a party to this action. Defendant is fully protected by the decree so far as her obligation under her contract exists, and plaintiff has an enforceable contract against Wilhoite, to which he can revert for any failure on her part to fulfil its conditions, if, in fact, those conditions have not already been fulfilled by the tender and ' signing of the deed of May 25th. But this is a matter between Wilhoite and the complainant, of which defendant can have no concern. In this case, when the tender was made, Wilhoite, the intermediate party, was present. The deed in which she was made a party, and which she had signed, was presented to the defendant for execution, which was refused. Wiihoite, by the execution of this instrument, by her general tender of performance to both plaintiff and defendant, by the tender of her note for $150,000, in compliance with her contract with defendant, as well as by her agreement of sale with plaintiff of May 3d, is estopped from bringing her action against defendant for default under said contract, when defendant has complied with the decree of the court below. It may be observed, however, that, so far as the record discloses, no objection was made because of defect of parties in the court below; and it is doubtful if this objection is available in the first instance on appeal. Upon the evidence adduced in the trial, we think if the matter had been presented to the court below, it should have resulted in the same decree as was entered.

It is also insisted that there is nothing in the record to show that the contract between Wiihoite and the plaintiff, of May 3d, has been carried out, and, in the absence of affirmative proof of this fact, plaintiff cannot assert any claim against the defendant as the assignee or vendee of Wiihoite. It appears that Wiihoite was present when plaintiff tendered performance to defendant; that she signed the deed of May 25th, which was prepared to be jointly executed by both her and the defendant;, that, when the defendant refused to execute the deed, Wiihoite tendered herself ready to perform her contracts, both with plaintiff and defendant; and that defendant still refused to carry out her contract, either with Wiihoite or the plaintiff. In the face of these facts, defendant is not in a good position to inquire into either the state of the contract between Wiihoite and the plaintiff, or their good faith in this part of the transaction. The contract and conveyance from Wiihoite to plaintiff was sufficient to vest in him her equitable interest in the property, and to authorize him to institute and maintain this action.

Specific performance of a contract of sale is not a matter of course, but rests largely in the discretion of the court, from a view of all the circumstances of the case. It will not be enforced where the contract is unfair or unequal in its terms, and where injustice would be perpetrated by its enforcement. This discretion also exists where the contract, though fair and just on its face, would, if enforced, by reason of subsequent events or collateral circumstances, work hardship or injustice to either of the parties. It will not be enforced arbitrarily, at the.mere pleasure of the court. But we find nothing in this transaction that shows such injustice or unfairness as would authorize the court in refusing the relief sought. The consideration, it is conceded, was a fair one; the defendant, before signing the contract, was advised to consult her attorney, which she did; and when the contract was signed, there was a full explanation by the agents of the purchaser, the purchaser being present, as to the details of the transaction to that point. The record does not disclose that complainant had come into the transaction at the time of the signing of the contract. Defendant, two days later, called at the office of complainant, and was informed that he had purchased the property from the original vendee through her agents. No protest or objection was made by defendant, and not until several days afterwards did she object to carrying out the contract. Her objection was not made because of any injustice or unfairness that had been perpetrated upon her, but because her mother would not join in the conveyance. This objection was met by complainant’s tendering performance upon condition of her executing a deed with special warranty, conveying her individual interest in the property. Under this state of facts, we find no room for the exercise of discretion in favor of the defendant. The judgment is affirmed with costs, and it is so ordered. Affirmed.

An appeal by the appellant to the Supreme Court of the United States was allowed March 12, 1909.