32 A.2d 227 | Pa. | 1943
In this action plaintiffs sought the rather anomalous decree that a good and marketable title in fee simple for an undivided one-fourth interest in "coal premises", hereinafter referred to as the coal, was vested in her individually and that she assole surviving executrix of the Estate of John B. Smith, deceased, has the power to convey a good and marketable title in fee simple for an undivided one-fourth interest in the same premises, to the Glen Alden Coal Company, and that by reason of her contract to sell her interest in this coal, to this company, there was due and owing her by this company the sum of $2,512.50, without interest.
The parties to this record are identified as follows: The original plaintiff below was May Virginia Smith (hereinafter referred to as Miss Smith), acting in a dual capacity, i. e., individually and as sole surviving executrix of the estate of her father, John B. Smith, deceased, hereinafter referred to as the testator. The bill was filed on February 6, 1941. Miss Smith died on September 6, 1941, and D. N. Yeager and Sarah Davis were *293 substituted as parties plaintiff to this record, as executors of Miss Smith's estate. They are here now as appellees. After Miss Smith's death, the Second National Bank of Wilkes-Barre was appointed on October 2, 1942, as administrator d. b. n. c. t. a. of the estate of the testator, and intervened in these proceedings as a defendant. It is herein referred to as the Bank. The Glen Alden Coal Company by reason of its contract with Miss Smith for the purchase of the coal, is also a defendant. It is hereinafter referred to as Glen Alden. A third group of defendants consists of Daisy R. Dungan and 27 others. They were joined in this suit because they are the persons who, in addition to Miss Smith, claim to have an interest in the coal as descendants and heirs of the testator.
There are two basic questions in this case: First, was Miss Smith's one-fourth interest in her father's estate, under the ninth paragraph of his will, a life interest or an absolute interest? Second, if it was an absolute interest, was that interest in the coal, realty or personalty?
On November 3, 1879, the testator leased all the coal and other minerals in a certain parcel of land in Plymouth Township, to the Lehigh Wilkes-Barre Coal Company, all of which company's capital stock is now owned by Glen Alden. The lessor died testate on July 19, 1904, and his executors were his son, his two daughters, his son-in-law, and the latter's wife. When this bill was filed all of these executors except Miss Smith were dead. On September 7, 1937, she, both as sole surviving executrix and in her own right individually, entered into an an agreement whereby she promised to convey for $2,512.50 to Glen Alden, in fee simple, free and clear of all liens and encumbrances, an undivided one-fourth interest in and to the coal and all minerals described in the 1879 lease, supra, together with a one-fourth interest in "the rents, royalties, reversion and remainder and estate, real and personal to her", the grantor; together with *294 the right to mine and remove the coal without liability for surface support to the extent that she had the right to waive such liability. All rights to the grantor to surface support, vertical or lateral, she released and quit-claimed to the grantee. She agreed to convey the above to the Glen Alden by a general warranty deed conveying a good marketable title in fee simple to the premises and rights hereinbefore set forth, free and clear of all liens and encumbrances, in form satisfactory to the General Counsel of Grantee.
She tendered the Company a deed as provided by this agreement and approved as to form by its General Counsel, and demanded payment of the consideration of $2,512.50. The Company declined to pay this sum and accept the deed on account of the claim of other defendants to this coal, and because of the doubt whether Appellee's interest was an absolute interest or only a life estate. It agreed to accept the deed and pay the purchase price if it should be found that the deed so tendered conveyed a title in fee simple to the property agreed to be conveyed and free of liens and encumbrances.
The Chancellor in his adjudication found that Miss Smith "took an indefeasible fee simple estate under her father's will" and that "plaintiff's interest in the coal and in the lease is realty" and that Miss Smith could individually in her own right as a holder of a fee simple estate in the realty to the extent of her one-fourth interest sell this to Glen Alden and it entered a decree nisi accordingly.
The Court, en banc, after hearing upon exceptions to the decree nisi, reversed the adjudication as to Miss Smith's interest being real estate and held that she "was free to sell, assign and transfer to the Glen Alden Coal Company all her right, title and interest, being an absolute one-quarter interest in the royalties which belonged to her under her father's will accruing under the lease made in 1879 . . .; not, however, to convey and transfer said interest as real estate but as personal property only." *295
The court also held that "the form of transfer should be changed". The court entered a final decree as follows: ". . . upon delivery to the Glen Alden Company of instrument in due and proper form, executed and acknowledged by the personal representative or representatives of May Virginia Smith, deceased, granting, selling, conveying and transferring all of the said May Virginia Smith's right, title and interest, being an undivided one-quarter interest in and to the coal lease between John B. Smith and Evaline B. Smith, lessors, and Lehigh and Wilkes-Barre Coal Company leasee, the Glen Alden Coal Company shall pay to the said personal representative or representatives of the said May Virginia Smith, deceased, the purchase money agreed upon, to wit, $2512.50 without interest."
Appeals were taken by the Bank, by Glen Alden, and by Daisy R. Dungan. The other heirs of John B. Smith did not appeal.
Glen Alden takes the position that the interest of Miss Smith in the coal was absolute and she had the power to convey an absolute estate to the extent of a one-fourth interest in the coal. It avers that it is willing to abide by the agreement to pay the executors of Miss Smith's estate $2,512.50. It says: "The only reason why the agreement was not carried out during the life time of Miss Smith was because of the doubt whether her estate and interest was absolute or was a life estate. Glen Alden also says "that upon the death of one having an interest as lessor in such a lease [as this], the royalties are payable to his personal representatives until such time as proper distribution of his estate has been made. Prager's Estate,
The Bank contends that "the title to the coal lease in question passed to the executors as part of the residuary estate of the decedent for the purpose of administration . . ., that neither May Virginia Smith nor any of the residuary legatees had any interest in the specific coal lease which either of them could convey, that the interest of these residuary legatees is confined to an equal distribution of the funds received from the personal assets of the decedent to be accounted for by the executors, that Miss Smith's interest therein was a life estate, and that the title to the coal lease passed to the executors, rather than to the residuary legatees, for administration and ultimate distribution to the legatees in accordance with their respective interests under the will." The bank said nothing about "the third estate".
The third paragraph of testator's will gave his executors and the survivor of them "full power and authority" (1) to lease all of his real estate not specifically devised and to account for the royalties therefrom "as personalty" and (2) to sell and convey all of testator's real estate not specifically devised. After making specific devises and bequests of certain lands and personal property not involved in this case, the testator in the ninth paragraph of his will devised and bequeathed "all the rest, residue and remainder" of his estate, "real, personal and mixed" to his four children (naming them) and then added: "Should my daughter, May Virginia Smith, die leaving no child or children or issue of deceased children living at the time of her death, I give, devise and bequeath her share of my residuary estate to my other three children aforesaid and their heirs share *297 and share alike." When testator died, his interest in the 1879 lease on the coal and his right to surface support over that coal were intact.
We decide that Miss Smith took an absolute estate under her father's will. The language of the ninth paragraph brings this case within our ruling in Lerch's Estate,
In the case of Davenport v. Graham,
In the instant case we must, to be consistent with our rulings in Lerch's Estate, Crawford v. Withrow, and Williamson v. Greene Improvement Co., all supra, and in many other cases, hold that the applicable testamentary provision here meant Miss Smith's death without issue in the lifetime of the testator. Since Miss Smith died without issue after the testator's death, the restrictive provision cited was inoperative to limit her inheritance. We agree with the court below that it was the manifest intent of the testator throughout his will to equalize his children in the distribution in the enjoyment of his estate. In the eleventh paragraph of his will he stated that he "tried to make a fair disposition of my property to my four children". Dividing the property equally among the four children was manifestly a "fair disposition". The court below pointed out that "it appears throughout the administration of the estate that distribution and conveyances had been made in which all of the heirs, devisees and legatees evidently assumed and took for granted that May Virginia Smith took an absolute interest, share and share alike, with John B. Smith's other children, notwithstanding the contingency mentioned in the ninth paragraph of the will concerning her decease without marriage and issue". It is true, as the court ended; "Those transactions . . . have no controlling force . . . but they have some significance." What is controlling with us is that the testamentary provisions in the three cases last above cited are substantially identical with the restrictive provisions in the will before us. The decisions in those cases therefore rule this case.
The next question is: Was the testator's interest in the coal realty or personalty? If it was the latter it is vested in the administrator d. b. n. c. t. a. for administration. It is settled in this State that a lease of coal in place, such as this is, "until such time as all the available merchantable coal shall have been mined and removed", is a sale of an estatein fee simple and leaves the *299
lessor with only an interest in the royalties to be paid him under that lease. That interest is personalty. This conclusion is supported by the decisions of this court inLillibridge v. Coal Co.,
After John B. Smith executed and delivered his "lease" of this coal, to the Lehigh and Wilkes-Barre Coal Co. on November 11, 1897, he no longer owned any estate in it, though he still retained his estate in the surface and in his right to surfacesupport. When a vendor sells land on a contract his interest in it ceases to be real estate. "It becomes a chose in action, a personal demand for the consideration, money, which in case of death goes to his personal representatives, and the legal title is held only as security for the payment of the debt. The vendee becomes in substance the owner of the estate". Longwell
v. Bently,
In the instant case, Smith's interest in the lease was property but it was not real property. He had parted with his coal and in lieu thereof he had the lessee's obligation to pay him the purchase money in royalty installments.1 In Prager'sEstate,
"Where an estate in land is granted, whether for years, for life, or in fee, the existence of a condition subsequent in no way lessens the quantity of the estate granted. The grantor is divested of the entire estate of the term or the fee, and the grantee is invested with the same estate. The effect of the condition is simply that, if a breach shall occur, the grantor shall have a right to re-enter and thereby become revested with his former estate. Before breach this is regarded as a mere possibility, coupled with no interest in the land. . . After breach of the condition, what was before a mere possibility becomes a right to secure a revesting of the former estate by entry, or by action at law. Until such entry or action the quantity of the estate of the grantee is still unimpaired. If the right of entry is never exercised, the estate remains as before. . . Under feudal conditions, he who was out of possession was likely to be tempted to part with his claim to those who might gain possession by force or favor, rather than by right. To avoid this, and to discourage maintenance, the common law forbade the transfer of rights of entry."2
The decision in Burke et ux. v. Kerr,
These decisions are out of line with the rational foundation of those decisions which have established the rule in Pennsylvania that the lease of coal in place with the right to mine and remove all of it for a stipulated royalty vests in the lessee a fee.*3 It is a necessary corollary that if the fee to the severed coal is vested in the lessee no interest in the coal as real property remains in the lessor and that his only interest therein is personal property. The lessor's interest in the lease is properly termed a possibility of reverter. *302
The decisions in Burke v. Kerr, Coolbaugh v. Lehigh W-B.Coal Co., and Gallagher v. Hicks, supra, will not be over-ruled by us* because of the principle of stare decisis. A rule of property long acquiesced in should not be overthrown except for compelling reasons of public policy or the imperative demands of justice. These three decisions are limited to the holding that the grantor in such a lease retains only a sufficient interest in the thing leased to subject the "purchase money" tobe paid him for it to the lien of a judgment against him.
After the testator delivered this lease his only interest in the coal was a possibility of reverter,*4 and this "is not an estate, present or future, but merely a possibility of having a future estate" in that coal. "In the case of a base or qualified fee expiring by its own contingent limitation, it is a right to have the fee simple in possession contingent upon the determination of the fee defeasible. In the case of a fee limited upon a condition subsequent, it is a contingent right of re-entry upon condition broken": Copenhaver v. Pendleton,
What the lessee in the 1879 lease got was "the coal itself and not a mere license to mine coal upon compliance with certain conditions . . . the recording of the conveyance takes the place of a livery of seizin", per RICE, P. J., inHosack v. Crill, supra. It follows that Miss Smith, the sole surviving executrix of the testator's estate, had when she executed the 1937 agreement with Glen Alden, the right as executor to agree to sell the testator's interest in that lease because that interest was personal property. Individually she had no alienable interest in that lease. The appellant bank's contention that the title to the coal lease passed to the executors as part of the residuary estate for the purpose of administration is sustained. This conclusion is consistent with the decisions of this court in Lazarus' Estate,
As already noted, the testator never parted with his right to the support of the land out of which he carved the separate estate in the coal "leased" in 1879. "The owner of the surface is entitled to absolute support of his land, not as an easement or right depending on a supposed grant, but as a proprietary right at common law." Carlin Co. v. Chappel,
It is well recognized in Pennsylvania that there may be three estates in land, namely, coal, surface, and right of support, so that one person may own the coal, another the surface, and the third the right of support: Charnetski v. Miners Mills CoalMin. Co.,
When John B. Smith on November 3, 1879, leased "all the coal upon and under" the described tract of 23 acres and 41 perches he did not divest himself of his "third estate"5 in that tract; this was a part of the *305 real estate which he by his will empowered his executors to sell and "make and deliver" deeds therefor.
When Miss Smith executed the contract with the Glen Alden on September 7, 1937, she did so both individually, and in herrepresentative capacity as executrix of the Estate of John B. Smith, deceased. In these capacities she agreed to convey to Glen Alden in fee simple, free and clear of all liens and encumbrances "an undivided one-fourth interest" in (1) "the coal and minerals", contained in the 23.34 acres therein described; (2) the 1879 lease, supra, and all rents and royalties arising therefrom; and (3) the "third estate", i. e. the right to surface support, both vertical and lateral. As to (1) she had no right in any capacity to make a conveyance, as the coal and minerals which she promised to convey had vestedin the lessee under the 1879 lease. As to (2) she had the power as executrix to sell, as the subject-matter was personal property. As to (3) she had the power as executrix to sell for this was real estate and under the will she had specific authority to sell any real estate of which the testator had died seized.
The Glen Alden Coal Company is entitled upon a tender of $2512.50 being made by it to the administrator d. b. n. c. t. a. of the Estate of John B. Smith, deceased, to have granted, sold and conveyed to it those property rights which May Virginia Smith, as executrix, by her contract of September 7, 1937, agreed to "grant, bargain, sell and convey unto" that company, and all of which are enumerated in the preceding paragraph. Miss Smith's joinder individually in that 1937 contract is of no legal importance, since she as an individual had no power to convey any part of her father's estate to anybody. Her joining in the 1937 contract "in a representativecapacity as executrix of the Estate of John B. Smith, Deceased", is of legal importance, for only in that capacity did she have any legal authority to contract to sell any real or personal property belonging to her father's estate.
The decree entered in this case is erroneous because except for the part relating to the tender of $2,512.50, *306 which is properly directed to the Glen Alden Coal Company, the decree is directed only to the Executors of the Executors of the Estate of May Virginia Smith. Since Miss Smith had no power as an individual to sell any part of her father's estate, it follows that her executors have no such power now. Miss Smith's power as executrix has passed to the Second National Bank of Wilkes-Barre, Pennsylvania, as administrator d. b. n. c. t. a. of the Estate of John B. Smith, Deceased, and to it should the decree be directed. This administrator has the power6 to convey to the Glen Alden Coal Company everything constituting the subject-matter of the agreement of September 7, 1937, and it should be directed to make to that company the grant, sale and conveyance the company bargained for in the 1937 agreement, upon a tender being made by the company of the stipulated sum of $2,512.50.
Glen Alden in its bill of exceptions alleged that the Court erred in not entering decrees pro confesso as to those defendants not appearing or answering and as to whom plaintiff entered orders that the bill be taken pro confesso. This exception is well taken. We held in Solar E. Co. v. BrookvilleBoro. et al.,
The decree is reversed and the record is remitted to the court below for further proceedings in conformity with this opinion; costs to be divided between the appellee and the appellant bank.