40 Tex. 251 | Tex. | 1874
Lead Opinion
We have no hesitation whatever in reversing the judgment in this case, but by the conduct of the parties some complications are presented which require examination and explanation from this court.
The property in controversy seems to be a valuable tract of land which belonged to the estate of B. H. Smith, who made his last will about the month of April, 1861. He appointed W. J. Smith executor of his will, providing for the payment of Ms debts, and devising the residue of his property to certain of his relatives, among whom are the parties to this suit.
The will was probated, and an inventory of the estate .returned ; which being done, the will by its terms withdrew the estate from the further control of the probate court.
B. H. Smith died pending the' suit, and Earle dismissed as to him, taking a judgment against the other defendants; they, however, proving insolvent, Earle revived his suit against W. J. Smith, the executor.
But in the meantime, in 1864, the devisees consenting to the sale, or perhaps constituting W. J. Smith, the executor, their agent for that purpose, he sold the land in controversy to one Durham on a credit of twelve months, taking notes in such amounts as represented the individual shares of the devisees, and retaining the vendor’s lien-to secure the notes.
The notes were delivered to the devisees, and Durham took possession of the land. No deed was made, but a. title bond was given which obligated Smith, the executor,.. to make Durham a deed on full payment of all the notes.
Willie, the minor soil of Mrs. Cross, was entitled to the-proceeds of one of the notes; his mother, acting for him,, brought suit against Durham on this note, and prayed for a foreclosure of the vendor’s lien; she obtained a judgment and decree accordingly, caused the land to be-sold on execution, and she and her husband became the purchasers at a consideration greatly below the actual value of the land, and not even covering the amount of' the note.
The question now presents itself, what did the appellees gain, or what title did they acquire by this sale, as against the devisees under the will of B. H. Smith, or his-creditors 1 The answer is obvious. They sold and bought just what title Durham had, and nothing more; and at-best he had but an inchoate title, which could only be-perfected on payment of the whole of the- purchase-money, which has never been done.
Let us now look after the title of the appellant, McDonough. He is a purchaser at judicial sale, to whom, under all the circumstances, the maxim caveat emptor must apply.
Under Article 1371, W. H. Smith, being the executor of the independent will of B. H. Smith, could be sued by ••the creditors of the latter, and upon judgment, execution • could run against the assets of the estate in his hands.
But was this land, in any proper sense, still in the hands of the executor % We think not; some four years or more had elapsed, Earle had dismissed his original suit on the Jordan note as to B. H. Smith, had taken a judgment against his co-obligors, and both the executor and devisees might well have supposed that “this debt ■had been extinguished or abandoned when the land was sold in 1864 to Durham.”
But under Article 1373, Paschal’s Digest, the estate of ,B. H. Smith immediately on his death vested in the devisees, and this statute expressly declares that the estate ^remains subject to the payment of debts in the hands of the devisees. But the title under which McDonough, the appellant, claims, comes through a sheriff’s sale of this land, upon a judgment against W. J. Smith, the expeditor.
We are clearly of opinion that the land could in no ■legal sense be treated as assets in the hands of the executor, and the title is not affected by sale upon a judgment .¡against him alone.
The creditor should have pursued the assets in the ■hands of the devisees, who are, in a legal sense, trustees ffor the use of creditors so long as any valid debt of their 'testator remains unpaid.
We do not think that this case is affected by the fact ¡that some of the devisees were minors at the date of the
We must not be understood in this opinion as setting aside the judgment under which the appellant claims title — that may be valid; and if so, it should be paid in full by the devisees, by which means they will relieve the ■ land from the burdens of the trust.
Durham having failed to pay for the land, and not being entitled to specific performance, the devisees may have his title bond canceled, the land partitioned or sold and the money divided.
Under the view we take of this case, the judgment of' the District Court is reversed and the cause dismissed.
Reversed and dismissed.
Opinion delivered September 8, 1873.
A rehearing was granted.
Rehearing
On Rehearing.
Long & Long, for appellees. — It will appear from the opinion of the court in this cause that two principal questions arose and were decided by the court, by which-decision it was held that neither appellant, McDonough, nor appellees, Cross and wife, were entitled to the-land sued for. In effect, the court held, that Cross and wife (or rather Willie Smith, their ward,) owned an interest in common with the two intervenors and another - party in the land.
If the court was right in thus placing the title in Willie Smith ás a tenant in common with the intervenors? it-erred in failing to allow him (or his guardians, Cross and wife, for him,) to recover the land from the appellant, McDonough, a stranger to the title. “ One tenant in com
■“ We have heretofore- decided that one tenant in common may maintain an action of ‘trespass to try title’ against a stranger.” (Watrous v. McGrew, 16 Texas, 506.)
If the partition had been invalid, still the decree, without partition, vested in the “plaintiff an undivided interest in common with the original grantee, and that was sufficient to entitle him to maintain an action against the defendant.” “We have heretofore decided that one tenant in common may maintain an action of trespass to try title against a stranger.” ' (Dyer v. Sullivan, 18 Texas, 767.) * * * * . * * *
Appellant labors to show, what we have never pretended to deny, that this land, in the hands of the legatees, was liable to pay any debts of the testator, for the statute expressly so declares. (Article 1373, Paschal’s Digest.) But the question is, can this land be thus subjected to sale -by any proceedings to which said legatees are not made parties ? We suppose it to be too elementary and familiar a principle of law to require authority, that as to These legatees (in whom the statute just cited vests the title to the land, both legal rand equitable), the decree in Earle’s favor was and is totally inoperative and void. If the opinion of the court be correct, that the sale by Cross and wife of this land in satisfaction of their ward’s share •of the purchase money due from Durham did not vest them with the whole title or interest in the land in trust for Willie Smith, their ward, then indeed it would follow, as a necessary consequence, that the title or interest remained in all the legatees under the will, just as it did before this sale to Durham.
Therefore it would seem to be plain that the land, after The sale to Durham by the executor as the agent of the legatees, or as executor under the will, could not legally -fee sold .as assets in the hands-of the executor. The land
The executor, therefore^ must be considered -as having yielded up the possession and control of this.land in good faith, in accordance with law, and upon perfectly sound reason. A creditor of an estate can never rightfully obtain a decree to sell this land until the legatees are made parties to the suit, and have a right to contest the validity of the debt sought to be enforced by its sale. Whether the legatees in this instance were not made parties to Earle’s suit, through ignorance or through fraud, can make no difference, for it is not lawful in any case to decree the sale of land without first giving the owner of it his day in court. The decree is simply -void as. to these legatees as such, and as to Cross -and wife as guardians-of Willie Smith, who had -purchased the same land
Counsel for McDonough also labor to prove that there is and was no statute of four years limitation to bar the right of Earle’s action in the case. Certainly, we never supposed there was any such statute of limitation. . On the contrary, we contend, that after the sale of the land to Durham, and after the land had passed out of the control of the executor, no suit or judgment against him could bind the property as assets in his hands to be ad-' ministered. In our brief it was mentioned, that Earle’s decree was obtained about four years after this change of possession of the land, because the fact was so, and not because the right existed after that event, but was barred by the lapse of four years.
It is also contended, that even if it be true that the court could not lawfully decree the sale of this land specifically, as was done in this case, yet that the prayer for the sale of this specific land was unnecessary, and might have been rightfully refused by the court, and only a judgment rendered against the executor for the money, to be paid de bonis testator is, and that the law would have obliged the sheriff to have levied upon and sold the same as assets in the hands of the executor to be administered, although the same had been sold three years before. This position looks very much like begging the question; for if it were true, which it is not, still it would not mend the matter, because the decree directed the sale of this particular land without the legatees (in whom the title had vested) being made parties before the court.
It is also contended, that since the passage of the act of 1862 (Articles 1872, 1373, Paschal’s Digest), a creditor cannot sue the heirs or legatees of a testator or intestate after the estate has been distributed to them. .The same brief declares that the case cited by us, of Payne v. Murchison, 37 Texas, is not an instance of the kind. Having
But it is said, on behalf of McDonough, that even if his-title be otherwise insufficient, he is the owner and holder of one of the purchase money notes, and thereby stands on as high equitable grounds as Cross and wife, or their ward, Willie Smith, and that by virtue of that equity he has a right to remain in possession of the land as against" Cross and wife or Willie Smith. If this assertion be traé
After an elaborate and exhaustive review of all the cases, both English and American, on this subject, Hare & Wallace, in their learned notes to 1 Leading Cases in Equity, page .279, thus sum up the doctrine of lien for purchase money:
“The true nature of the claim appears to'be this: It had its origin in a country where lands were not liable— both during and after the life of the debtor — for all personal obligations indiscriminately, including debts of simple contract; and it seems to be an original and natural equity that a creditor, whose debt was the consideration of the land, should, by virtue of that consideration, be allowed to charge the land upon failure of personal a ssets. It is not a lien until a bill has. been filed to assert it; before that is done it is a mere equity or capacity to acquire a lien and to have satisfaction of it. When a bill is filed it becomes a specific lien. The equity dates back, no doubt, to the time of the conveyance and to the origin of the debt. As soon as the debt for the purchase money exists, though to be paid in futuro, the equity to come upon the land attaches to it. Wherefore it prevails against dower and all other estates which the law considers as in privity with that' of the vendee. It prevails against all who take with notice, actual or legal, for all*275 such persons are considered as standing in the situation of the vendee. In all such cases the dispute is. between the vendor on the one hand, and the vendee and his representatives on the other. But when subsequent lien creditors intervene, the contest is no longer between the vendor and vendee ; it is with third persons contending for the estate. It depends no longer upon the equity of one party as against the vendee and those in privity with him. It depends upon the relations, rights and equities of the disputants in comparison with one another. If this be a correct view of the nature of the vendor’s claim, the question is at an end. Lien creditors will supplant one who, though he had a right in equity to charge the land, through his own laches and default failed to secure a lien. Lien creditors are entitled to the whole estate of their debtor, subject only to prior liens, legal or equitable.” (Leading Cases in Equity, 379, 380.)
This being the law, it follows that Cross and wife, as guardians for Willie Smith, having filed their bill for the purpose, obtained a lien for his purchase money note; and no other such bill having been filed by the holders of any of the other three purchase money notes, he had a right to sell the whole land for the satisfaction of his lien so acquired ; not only as to McDonough, if he then held the note he now claims to own and hold, but equally as to both the intervenors. It follows, as a consequence, therefore, that as Cross and wife first filed a bill to obtain a lien on said land, they had a perfect right to sell the whole land for its satisfaction, and that the holders of the other purchase money notes (the said intervenors and McDonough) have lost their rights to obtain such lien by their own laches and want of vigilance. Thus we see that the doctrine of vigilance, as old as it is salutary, at this day remains in as full vigor as when originally announced in the civil and common law. It is a principle resting upon sound reason and morals and good public
The position contended for by appellant, and indeed sustained by the court, that Cross and wife only sold such interest in this land as Durham at that time owned, is plainly contradicted by the. petition of Cross and wife, and by the words of the decree. The petition claims a judgment as at law for the money due on the note, and for a decree as in equity for the sale of this particular tract of land, by metes and bounds, for its satisfaction, alleging the debt to be for the purchase money of this particular land. This was but an ordinary exercise of the legal and equitable jurisdiction of the District Court. And the suggestion that the decree was void, because the intervenors were not made parties, is absolutely absurd, when it is considered that the holders of the other notes had no lien upon the land or trust of any kind, and that the plaintiffs were only exercising their rights to use more diligence than others who were equally entitled to file a bill to claim such lien. In the language of the authorities just quoted, Cross and wife thus acquired a lien, and therefore will supplant one “who, though he had a right in equity to charge the land, through his own laches and default failed to secure a lien.”
Precisely because plaintiffs had a right to secure this advantage, by superior vigilance, and were in consequence thereof entitled to sell the whole land for their debt, intervenors were not made parties.
Plaintiffs were not bound to do anything for the advantage of these intervenors, even if making them parties defendant would have had that effect, which certainly it would not. Plaintiffs had filed a bill claiming this lien, and had thereby acquired it. To have made these intervenors parties defendant would not have given them a lien. This could only have been acquired by filing a bill and setting up their claim therefor. Their .laches
But even if making them parties defendant would have placed them upon an equal footing with the plaintiffs, and have deprived plaintiffs of all superiority, on account of filing their bill to acquire a prior lien, just as attachment creditors seek to be first in obtaining a lien, it would be still more absurd to hold that plaintiffs were bound to do themselves this injury. As already suggested in our former brief, the plaintiffs could not know, and were not in law bound to know, who were the owners and holders of these negotiable notes, one of which, it now appears, had been negotiated, as all might have been, or they might have been paid and otherwise discharged. This' sale therefore to Cross and wife was neither a judgment as at law, and execution thereon against Durham, nor was it a specific decree to sell Durham’s interest in this particular land, "as assumed by the argument on the other side; but it was a decree by a court of competent jurisdiction to sell this particular piece or parcel of land to satisfy a debt, for which a judgment had been rendered — a lien prior to all others, having been previously obtained by first filing a bill claiming the same.
Moore, Associate Justice. — This suit was brought by Mary Cross and her husband, P. H. Cross, the appellees, against A. H. McDonough, the appellant, to recover a tract of land which belonged to B. H. Smith previous to his death. The other appellants intervened, and claimed the land in their own right, or such interest in it or its proceeds as they might be found by a decree of the court to be entitled to.
As the court below sustained the exception of the appellant, McDonough, to so much of the petitions of the
Several of the questions which have been discussed during, the progress of the cause are somewhat novel and not altogether free from difficulty. Their solution depends mainly upon the provisions of the will of said Smith, the action of the parties interested in the settlement of his estate, and proper construction in connection therewith of the statute authorizing wills providing for the settlement of estates without the supervision and control of the courts. (Paschal’s Digest, Article 1371.)
The plaintiffs- below, Cross and wife, and the intervenors, claim as devisees, or in right of devisees in said will, while McDonough claims through a creditor of the estate, and also as subrogated to the interest of one of the devisees.' And as the rights of the creditors of decedents, if duly and properly enforced, are superior to those of his heirs or devisees, there can be no question, unless there has been a failure of the creditor, through whom McDonough claims to have acquired his title, to avail himself in due time of the remedies provided by law for his protection, that neither plaintiffs nor intervenors are entitled to a judgment against him. It is insisted, however, by the appellees, that the creditor, Earle, under whom appellant, McDonough, claims, did not attempt to enforce his demand against the estate until long after administration upon it had closed, or at least till long after the land in controversy in this suit had ceased to be assets of the estate of the testator in the hands of the executor.
The will of the testator, Smith, was duly probated on the eleventh of April, 1863. But previous to his death
On this state of facts, it was insisted by appellant, McDonough, that the sale of land was absolutely void for want of authority in the will authorizing its sale by the executor for the purpose of distribution. On the other hand, it is urged that the will authorizes the executor to carry out its provisions ; and as the land could not be partitioned without the sale, the will must be held as conferring upon the executor the power of making the sale for this purpose. It seems a reasonable, if not a necessary, -construction of wills of this character, that the executor, when authorized to administer and settle estates independently of the supervision and control of the probate jurisdiction of the court, and where there are no terms of restriction upon his authority contained in the will, may do whatever is necessary for the full and complete settlement of the estate which he might do under the authority and order of the court if he was charged with the administration subject to its control by the will. We cannot, therefore, think there is any doubt that the executor may, without express authority, sell the property for the payment of the debts of the estate, or the discharge of any other trust which is-directly or exclusively committed to him by the will. Whether the sale of the land of the estate for distribution, even where not susceptible of partition, is a trust of this character need not now be determined. If the estate was being administered under the direction of the court, the executor would not partition the land if it could be divided consistently with the inter-jest of the devisees; nor would the determination of the -question of its susceptibility of division be entrusted to him by the court, and we do not clearly perceive that it
But if it is conceded the executor under the will in this case was not authorized thereby to sell the land, we do not think it follows that the sale here in question was not valid and binding. It is certainly within the authority conferred upon the executor, if no specific directions are contained in the will, whether the will is being administered under the supervision of the court or not, to determine when the devisees may take and hold the property devised, free from any claim of the executor thereto, for the purposes of administration. And if the executor, as the representative of the estate, acquiesces in the right of the devisees to the possession and enjoyment of the property devised, and the possession of it is delivered to them, it cannot be subsequently insisted that the devised property is still part of the estate of the testator in the hands of the executor. Unquestionably the devisees take the property subject to the right of the creditors to call upon them to contribute to the payment of the debts of the testator, if the executor fails to discharge them, or the property in their hands may, by a proper proceeding, be charged with their payment. And it may be, if the executor in fraud of the right of creditors has passed the estate committed to his charge out of his control, he may have made himself personally liable to the creditors. But still it must be admitted an ordinary judgment against
It may be insisted that it opens a wide door for fraud upon creditors, if executors, under such wills as are here in question may transfer the property of estates to the heirs or devisees before all the obligations of the estate have been discharged. It must be remembered, however, ample security is provided by the statute for creditors as well as others interested in the estate, if they are unwilling to risk its administration by the executor as provided by the will. And if there are evils growing out of or necessarily incident to such administrations, they are to be corrected by legislative interposition, and not by judicial interpolation.
It follows from these propositions, unless the sale of the land in controversy by the executor was an absolute nullity,, its subsequent sale under the execution against the executor in favor of the judgment creditor Earle, and the purchase of it by McDonough, was void. It certainly could not be seriously insisted that an executor under such a will as this could under no circumstances consent to the devisees taking the property devised prior to the discharge of all the debts of the estate and its final settlement. If not, how can any one else complain, if the devisees are satisfied that the executor exceeded his authority in the manner or form in which he has dealt with or conveyed to the devisees the property devised to them by the will ? The title to the property vested in the devisees immediately on the death of the testator, subject to being divested by a sale by the executor for the purposes of administration. But neither the devisees nor
It also appears from the record that the creditor, Earle, must have been informed of the sale and the distribution? of the notes given for the purchase money among the devisees ; for, some two years afterwards, he amended the-petition in his original suit, and alleged that all of the-property of the estate had been distributed among the devisees, and asked to make them parties, etc. But this was never done. Believing the original parties who were in-court to be solvent, and who, for aught that appears in the record, may, as among themselves, have been the principal debtors, he discontinued his suit as to the estate of the testator and the devisees, and made no complaint of the sale of the land or the distribution of the notes given to the executor by the purchaser until some four
At this stage of the proceedings for the settlement of the estate, the status of the parties interested in it was .as follows : Durham, the purchaser, was in possession of the land under an executory contract, upon which he was in default. The notes given for the purchase money had been distributed among the devisees in whom the legal title for their respective purparts vested on the death of the testator. They held, therefore, the superior and better title until the purchase money was paid, and could ■ enforce its payment by a personal action on the notes against the makers, or by an action for the recovery of the land on their superior title, against the purchaser, or . any one holding under him, or by a proceeding to enforce .the lien which the contract in legal effect gave them as a
But if McDonough acquired no title to the land by his purchase under Earle’s judgment, we think it quite evident, also, that neither the plaintiffs, Cross and wife, nor the intervenors were entitled to a judgment to eject him from the entire land. Cross and wife brought suit against Durham on one of the notes (as it has been argued, for the benefit of one of the devisees, though the record shows that the suit was brought as the legal representatives of the father of the devisee, instead of the dewisee himself), and asked for a judgment to enforce a •vendor’s lien. It may be observed, however, that strictly •speaking there was no such lien to secure the payment of .their note. The vendor’s lien is an implied lien, a mere «equity, incident to the contract for the sale of the land, if the purchase money is not otherwise secured. But if ;an express lien is retained, or other security is taken, unless it clearly appear that the implied lien is also retained, it is to be regarded as waived. In this case the purchaser gave personal security, and the vendor also retained the legal title. But whether the lien Cross and wife sought to enforce for the payment of the note upon ■which they sued is considered as an expressed or implied lien, in view of the facts of this case we think there would be no substantial difference in the rights acquired by their purchase of the land under their judgment, even admitting, as is argued for them, that they purchased ¡and were now suing for the land for and on behalf ,of the devisee for whom it is said Mrs. Cross is guardian. In cases of express lien or mortgage to secure ¡the payment of different creditors whose debts are ■due at the same time, and are not by the mortgage or contract giving the lien placed on a different footing, it is unquestionably '.well settled that neither of the creditors .are entitled to a «priority or preference over the others.
Certainly one of the creditors cannot, merely by a suit in his own behalf, seize upon and appropriate to his own benefit the entire security or trust fund. Though in some cases it has been held, as the vendor’s lien not being a matter of contract, but an incident of the contract by which a lien may be acquired by filing a bill in equity to charge the land with it, the advantage of it will be secured by the creditor who entitles himself to the favor of a court of equity by his superior diligence. Still it must be remembered that it is a mere equitable .right, and courts of equity will deal with or dispose of each particular case according to its facts and circumstances, so as to do equity to all parties. And though as a general rule the most diligent in seeking to avail himself of his equitable security, if he has an equal equity with the more dilatory, in the entire estate, will be ordinarily most favored, there is no principle of law or equity upon which this mere equitable lien for the purchase money due one of the vendors for his undivided interest in the land sold can be applied to the undivided interest of another tenant in common so aS to deprive him of a like security to the extent of his interest in the land in the sale of which they have joined.
In this case the devisees were tenants in common, and although the execution sold the entire land, yet appellees insist this was done at the instance of all of the devisees, and for the purpose of partition, and separate notes were at the time of the sale given to each of them for their portions of the amount for which .the land sold. Under these circumstances the lien for the payment of the notes, whatever may be its character, must be regarded as a security in favor of each of them to the extent of their respective interest in the land.
The appellant, McDonough, even before the purchase by Cross and wife, as the holder of one of the notes, had taken possession of the land, with the assent of the purchaser, and to that extent had the superior title, and might have compelled the executor to make him a deed for the undivided part to which he had thus acquired an equitable title. Consequently, although Mrs. Cross may have had the legal title to one share in the land, and as a tenant in common might recover the whole of it from a stranger, the judgment in favor of appellees for the entire tract was erroneous.
As to the interveners, it is only necessary to add, that although it appears from the record that the judgment under which they claim gives them no right to the land, or any part of it, because the parties against whom their suits were brought neither held nor claimed any interest whatever in it, yet, as devisees or as equitable owners under some of them, they were authorized to have intervened and set up their rights. This they seem to have attempted, though in a very imperfect and defective manner. But the judgment must be reversed for the reasons already indicated.
Although a jury was waived and the cause submitted to the court, as we believe it necessary for the proper determination of the cause that it should be remanded to the District Court, where all the parties may have an oppor
Reversed and remanded.