Titchenell v. Jackson

26 W. Va. 460 | W. Va. | 1885

Green, Judge:

The counsel for the appellants has argued this case, as though the question presented by the record was, whether a court of equity would specifically enforce the contract entered into by Joseph Feather with Michael S, Titchenell on September 6, 1880; and he argues, that it should not be specifically enforced, first, because it is not mutual; second, because it is too uncertain for specific enfoi'cement; third, because it should be regarded as nudum pactum there being no consideration on the part of Titchenell, and therefore it can not be specifically enforced in his favor; and fourth, because theplain-tiffbelow has entirely failed to perform his part of the contract, as is distinctly admitted by the decree of the court below in his favor. On the other hand the counsel for the appellee, the plaintiff below, have argued this case, as if the question before us was, whether the deed for the fifty acres of land made by the commissioner of the court, John Barton Payne, to Joseph Feather was, as it purports to be on its face, an absolute deed or a mortgage; and whether the contract made by Feather with Titchenell was a conditional sale of this tract of land, or whether by it Feather agreed to hold the legal title to the land simply to secure the payment to him of the$52.50, the cash paid by him on the day of sale, and as a further security for his indemnity, in case he should have to pay any of the three notes of $46.00 each, which he that day executed for the purchase-money of this land, together with Michael S. Titchenell, he standing, it is insisted, as the security of Titchenell in these notes, though the transaction, so far as the vendor, the commissioner, is concerned, took the form of a purchase by Feather and the giving of these notes by him for the land with Titchenell as his security.

It seems to me, that the real question involved in this case is not, whether the plaintiff has a right to have the contract specifically enforced, or whether the transactions between the plaintiff and Feather make the absolute deed to Feather a mortgage, but whether these transactions did not make Feather, when he took the deed from Payne, the commissioner, a trustee for the plaintiff Titchenell, and whether he did not violate this trust, when he conveyed this land to the defendant, Jackson; and whether Jackson, when he took such conveyance from the trustee Feather, did not take it in bad faith; and whether the deed from Feather to Jackson should not .therefore be declared fraudulent and void ; and whether the trustee, Feather, should not be required upon the payment to him oí all the moneys he had advanced and on the payment of all the moneys for which he was bound as surety for the plaintiff, to convey this land to the plaintiff". This, it seems to me from the final decree rendered in the cause by the court below, is the view which that court took of the case. If he were such trustee, then the final decree ot the circuit court must be affirmed, otherwise it must be reversed.

In deciding this question it becomes necessary to decide whether any parol testimony can be considered in determining it.

It is obvious, that if this deed on its face had been to Feather for the use of Titchenell, it would have been an executed and an express trust, which would have been valid, though it had been a mere gratuity to Titchenell. In fact a deed in this form would have been nothing but the usual mode anciently of creating a use, which by the English statute of uses would have been executed and the legal title at once invested in the cestui que use, Titchnell. TJnder our statute of uses however the legal title would not have been so transferred to the cestui que use, Titchenell; but the vendee Feather would have held the legal title in trust for the use of Titchenell, just as he would have done prior to the statute of uses. It would not in the least alter the case, if when the purchase was made a memorandum in writing had been executed by the nominal purchaser, Feather, whereby he declared, that the land purchased was for the use of Titchenell, though, when the deed was executed to him, there' had not been inserted in it the provision, that-it was conveyed to Feather for the use of Titchenell. It would be entirely immaterial, whether the declaration of such use was made on the face of the deed or in such separate paper executed by the nominal purchaser of the land at the time of the purchase; and'in such a case, as -when the declaration of use was made on the face of the deed, it would be totally immaterial, whether the cestui que trust, Titchenell, had or had not given any consideration for his position as cestui que trust.

"While as a general rule parol evidence can not be admitted to vary or add to a written contract and especially a contract for a sale of land or a deed conveying land, there • are however some cases, -which are sometimes called exceptions to the general rule, though really not exceptions, being cases to which this rule is not properly applicable. Thus, if the grantee has fraudulently taken a deed in his own name instead of in the name of another, this fact may be proven by parol evidence, and when proven, it would constitute him a trustee of such other person in the view of a court of equity as effectually, as if the land on the face of the deed had been conveyed to him for the use of such other person. So if. lands are purchased with the funds of A., and the absolute deed taken in the name of B., a court of equity would hold on the parol proof of these facts, that A. was but the trustee of B. as much, as if it had been so declared on the face of the deed. So if the scrivener had made a mistake in drawing the deed, it would be corrected by a court of equity on such mistake being clearly proven by parol evidence. So too a deed absolute on its face may he shown by parol evidence to have been given as security for a loan or as security for the payment of a precedent debt. In all these cases the real office of parol evidence is not to vary the deed or contract in writing, but to establish the existence of collateral facts, which when established control the deed or written contract. In like manner, if a party obtained a deed or devise without any consideration upon a parol assurance by the grantM or devisee, that he will hold it for- certain uses, he will be regarded by a court ot equity as holding the land as a trustee for such purposes, and that too though in case of a deed it was declared on its face, that it was made for a valuable-consideration. In such cases the deed or will is not added to or altered by parol evidence; but this evidence fastens on the individual, who has obtained the title without consideration, the personal obligation of fulfilling the trusts, by the promising to fulfil which he procured the title. But if the land was conveyed for a mere nominal consideration, a court of. equity would not admit parol evidence to prove, that the grantee agreed to hold the land for the use of the grantor as such parol evidence would defeat the very purpose, for which the deed was made and would thus violate the general rule above laid down.

The seventh section of the English Statute of Frauds, 29, Car. II., cli. 3, enacts that all declarations and creations of of trust or confidence in any lauds, tenements or heredita-ments “shall be manifested and proved by some writing signed by the party, who is by law to declare such trust, or by his last will in writing.” This section, or a section very similar to it, has been enacted in at least nineteen States, and constitutes a part of their statute of frauds. On the other hand it has been omitted from the statute of frauds in at least ten States including Virginia and West Virginia.

Where this seventh section of the English statute of frauds has been enacted, it is held that trusts in land can not be proven by parol; and where it has not been re-enacted, the decisions on this point have been variant. In Virginia and in West Virginia there have been no decisions as to whether the omissions of this section of the English statute of frauds has really made any difference in effect. There have been, however, some obiter dicta on this point. (Bank of United States v. Carrington et al, 7 Leigh 566; Walraven v. Lock et al, 2 Potter & Heath R. 547; Sprinkle et al. v. Hayworth et al, 26 Grat. 384; Troll v. Carter, 15 W. Va. 580-582.) In this last easel express the opinion, that a grant can not be affected with an oral trust for a third person, merely because there was a parol contract, that it should be so affected. But this was confessedly an obiter dictum, the court declining in that case to decide this point. The whole subject is fully considered in that case; and all the views I have above ex-' pressed are fully sustained by it and by the numerous authorities cited therein. But as in that case we deemed it unnecessary to decide whether a trust would be imposed on real estate in favor of a third person, when no fraud was proven, simply by parol proof that there was a contract that such trust should exist, so in this ease we decline to determine this question, as its decision is, we think, unnecessary. For in this case it is not proposed to impose on the land named in the bill a trust in favor of the plaintiff below simply on parol evidence of a contract or agreement to that effect but on a written memorandum signed by the grantee at the time this land was purchased. It is true, that this memorandum is on its face ambiguous, and unaided by any parol evidence it would be if not uuinteligible at least so doubtful in its meaning, that it could not be deemed a declaration of a trust in favor of Titchenell; but it may be regarded as well settled, that when the language of a written agreement is susceptible of more than one interpretation, that is to say, is on its face ambiguous, the courts will look at the surrounding circumstances existing when the contract was made, at the situation of the parties and the subject-matter of the contract, and will even call in aid the acts done by the parties under it as affording a clue to the intention of the parties; but the court never resorts in such a case to the verbal declaration of the parties either before, at the time or after the execution of the contract to aid it in giving construction to its language. (Crislip, Guardian, &c. v. Cain, 19 W. Va., 441, pt. 13 of syl. and the numerous authorities cited on pages 483 and 484.

Applying the rule here laid down to the memorandum or agreement dated September 6, 1880, executed by Joseph Feather, I think there is no difficulty in construingit, though on its face unaided by parol evidence of the situation of the parties, the circumstances surrounding them when this memorandum or contract was signed, and their conduct subsequently 'in carrying it into effect; it would be ambiguous. All ambiguity in this memorandum may be removed by this character of parol evidence, though all the verbal declarations of the parties as to its meaning are excluded, as indeed they must be. In fact in this case, if such verbal declarations were received, so far from aiding us in the interpretation of the contract they would only tend to render it the more ambiguous, as these verbal declarations are in their character contradictory.

What by the piarol evidence was the situation of the parties and the circumstances surrounding them, when this memorandum was signed, and what their subsequent conduct in carrying it out? A chancery suit had been instituted in the circuit court of Preston county to subject a tract of land of about fifty acres owned by Michael S. Titchenell in said county to the payment of a debt. This debt, interest and the costs of the suit amounted on September 6, 1880, to about $180.00, of which $52.50 was costs. This tract of land was worth not less than $400.00, and it had been decreed to be sold at public sale at the court-house in Preston by J. Barton Payne, commissioner, to pay this debt. While the sale was being made, the plaintiff in the chancery suit by the advice of the commissioner of sale, who, I presume, was his counsel in this cause, bid for this fifty acres of land the amount of his debt, interest and costs ($180.00.) This being really considerably less than half its value Titchenell, the owner of the land, asked Joseph Peather, who was present at this sale, to bid for the land for him; and though Peather did not want it he. did so, bidding for it fifty cents more, and it was knocked down to him. He then made the cash payment on this land to Payne, the commissioner of sale, being the costs, $52.50, and gave his three bonds with Titchenell as his security for the balance of the purchase, which was payable in three equal instalments in six, twelve and eighteen months with interest from date. At the same time Payne drew up this memorandum dated September 6,1880, and it was signed by Peather and kept by Payne. This is the memorandum which is to be interpreted. Titchenell remained in possession of the laud and cultivated it paying no rent therefor, no rent being charged for its use. At the circuit court of Preston this sale being reported by the commissioner to the court as a sale of the land to' Peather, and that he had complied with the terms of sale, there being no exception to his report, the sale was confirmed and a deed was ordered to be made to Peather by the commissioner, the vendor’s lien to be reserved as security for tlie future payments. This deed was accordingly made, and Titchenell having failed to repay to Feather the $52.50, the cash payment on this land, or either the first or second of the deferred payments of about $46.00 each, both of which had become due, Feather sold the land to Jackson and executed a deed conveying it on September 1, 1881.

These being the material facts, it seems to me, that in the light shed by them there is no sort of difficulty in interpreting the memorandum signed by Feather. It begins in these” words : “ Joseph Feather has this day bought in the land of M. S. Titchenell for the sum of $180.50.” The meaning of this preamble is evidently that Joseph Feather at the public sale just made had bought of the commissioner, who wrote this memorandum, this fifty-acre tract of land owned by Michael S. Titchenell for $180.50, and had bought it for Michael S. Titchenell and not for himself. This is what is meant by the words “ bought in the land of M. S. Titchenell for $180.50.” This memorandum then proceeds, “and he (Joseph Feather) agrees that if the said Michael S. Titchenell will pay the purchase-money-notes, as they become due, and shall pay the costs of said suit, which amount to $52.49, and interest by January 1, 1881, then the said Feather agrees to let the said Titchenell have the said land and will make him a good title thereto at the costs and charges of said Titchenell.”

The preamble of this memorandum shows, as wo have seen, that this tract of land was bought for Titchenell by Feather; and therefore, as we have seen, Feather became by this purchase a trustee holding the legal title to the land for the use of Titchenell; and, that the parties regarded themselves as holding this relation to each other, is distinctly shown by the fact, that Titchenell occupied this tract for a year thereafter without being charged any rent therefor, and by the further fact, that he Titchenell permitted this sale of his land at less than one-half of its value to be confirmed by the court without making any exception to the sale because of the gross inadequacy of the price, at which it was sold.

This being then the obvious relation of the parties to each other as understood by both of them, the rest of the memorandum interpreted by these circumstances amounts to this, that Titehenell would repay to Feather within three months the $52.49, which he had that day paid for him to the commissioner of sale, and would pay off the three notes of about $46.00 each, which Feather had executed for the deferred payments with Titehenell nominally as his surety; and to indemnify him for the $52.49, -which he had paid for Titehenell and to indemnify him against loss by reason othis having executed thethree notes of $46.00 each as surety for Titehenell, the legal title to this land would be conveyed to Feather, who 'would re-convey it to Titehenell on his re-paying the money paid for him and paying off the purchase-money notes.

This being the obvious meaning of this memorandum or agreement, it is obvious, that though Titehenell failed to pay the $52.49 to Feather on January 1, 1881, or failed to meet each of the deferred payments on the land, as they fell due, it would not operate in a court of equity as a forfeiture of his equitable title to the land, which was worth probably ten times the amount of any one of these payments, the failure to meet which promptly ata certain time was, as it is claimed, to work such forfeiture. This is not only the law, as it has always been recognized by courts of equity, who never enforce forfeiture, but it was obviously the law as understood bythe parties to this agreement. For though Titchenellhad failed to pay to Feather the $52.49 he had paid for him before January 1, 1881, yet Feather permitted him for a long time thereafter to hold possession of the-land, as though he was the owner thereof, and does not appear to have thought, that he had by this failure forfeited all his right to the land till some nine months thereafter.

My conclusion therefore is, that Feather was but the trustee holdiug the legal title to this land, first to repay himself this $52.49 which he had paid for Titehenell and thus to indemnify himself for any loss by reason of his having signed with Titehenell the three notes of about $46.00 each, and then for the use of Titehenell.

In violation of this trust Feather on September 13, 1881, sold and conveyed this land to Jackson for, it is presumed, the price, for which it had been knocked down to him at the public sale on September 6, 1880, with the interest then due thereon, that is, $180.50 Math interest from September 6, 1880, though what was the price paid for this tract of land by Jackson does not distinctly appear, nor is it at all important. The record shows distinctly, that when this sale and deed were made to Jackson, he had notice, that his grantor, Feather, was but a trustee, and that Titchenell was the equitable owner. This is distinctly and positively alleged in the bill. The language of the bill is : “Your orator alleges and charges, that said Jackson knew of the contract between the plaintiff and Feather as aforesaid, when and before he purchased said land, if purchase it he did, and received a deed therefor from said Feather.” This distinct allegation in the bill is not denied by Jackson in his answer, and must therefore be regarded as true. All that Jackson in his answer says on this subject is : “When the tract of land in the bill mentioned was sold by the commissioner of the court, the said Joseph Feather purchased the same, and while respondent was not advised at the time how the same was purchased, he has learned that Feather, for the express purpose of aiding the plaintiff, purchased the said tract of land and gave the plaintiff’ a paper signed by him, a copy of which is filed with the bill.” The bill distinctly alleges, as stated above, that Jackson had this definite knowledge of the character of the purchase by Feather, before he purchased and procured the deed from Feather. This knowledge is thus distinctly admitted by Jackson in his answer; and while he does not expressly admit, that he heard it prior to September 13, 1881, when he accepted the deed from Feather, yet he utterly fails to state, when he acquired this knowledge, and does not pretend to deny, that it was prior to September 13, 1881, when he took the deed. We must regard therefore the allegation on this subject above quoted from the bill as admitted in the answer. If it had not been, we think it was clearly proven by the evidence taken in the case.

Titchenell deposes, that Jackson was present, when this memorandum or agreement was signed by Feather, and made-suggestions in relation to it, while Payne, the commissioner of sale, was drawing it up. Jackson in his deposition denies, that he was present, when this memorandum or agreement was signed. Feather says, he does not remember, whether Jackson was present or not; and Payne, who drew up the paper, and who was, it is presumed, then as now counsel for Jackson, is silent on the subject. But Jackson in his deposition admits, that j?ayne told him of this arrangement between Titchenell and Feather and showed him this memorandum or agreement. This conversation, he says, was either in the spring or fall of 1881. But it was obviously before the deed was made to him; for he says, that Payne then told him, that no part of the purchase-money notes had been paid, and when this deed was made to him these notes were paid and cancelled, as stated by Payne in his deposition.

The purchase, therefore, of this land by Jackson of Feather, the trustee, with full and definite knowledge, that Feather was not the equitable owner, but that Titchenell was the equitable owner, was a fraud upon Titchenell; and the circuit court of Preston did not err in its decree of April 19, 1883, in setting aside and holding as naught this fraudulent deed. JSTor did it err to the prejudice of the appellants in declaring that the entire amount of the purchase-money for this land at the public sale made by Payne on September 6, 1880, that is to say, the $180.50 with the interest thereon, was a lien on the said tract of land, and when it was paid in full by Titchenell the said tract of land should be conveyed by Feather to him, or if Feather then refused to convey, it should be conveyed to him by a commissioner of the court appointed for the purpose in the decree. FTor was there any error in the decree that, when Titchenell had fully paid ofi this lien, he should have a writ of possession against Jackson, who had obtained possession of the land, since the deed for it was made to him.

Of course there is much of the evidence in this cause, which according to these views must be regarded as immaterial, and which I have not considered, though much of the argument of counsel was with reference to the facts proven by such evidence, which was contradictory and unsatisfactory. These disputed questions of fact, which I deem irrelevant, are such as these: Bid Tichenell pay to Feather the whole or any part of the $52.49 paid to Payne, the commissioner of sale, as the cash payment on the purchase of this land ? It was assumed by the decree of the court belowq that he did not, and of course the appellants can not complain on this account. Did Feather promise or agree with Titcheuell at any time, that he would extend the time, within which Titcheuell should be required to pay any or all- of the deferred payments ot the land ? Did Titchenell offer to pay to Jackson the amount of this purchase-money, and did Jackson refuse to accept it? Was Titcheuell utterly insolvent and unable to pay anything ? All these and other' like controverted questions of fact discussed by counsel would not however settled afiect the conclusion I have reached.

It was strongly insisted by the appellant’s counsel, that the decree should be reversed, because even if the decree was right in setting aside the sale by Feather to Jackson, still it ought to have provided for a re-sale of the land in order to pay to Jackson, the plaintiff in the former chancery suit, his debt, as it would remain unsatisfied, if this sale to him was set aside; for this debt was satisfied in no other way than by the sale of this land to him. But this decree fails to provide for this protection to Jackson in this or in any other manner ; and thus he an innocent party is made to lose his debt, which the court in the former suit had declared to be a lien on this land.

This would be very plausible, if Jackson was an innocent party, and if the result of this decree was necessarially to cause him to lose his debt. But one of these propositions is certainly not true, and the other also is very probably false. Jackson was certainly not an innocent party. The deed to him is set aside, because Feather in violation of his trust conveyed this land to him, and because when he purchased it and directed commissioner Payne to receipt for the purehase-money-notes as paid, he did so with a full knowledge, that Feather was acting in bad faith in selling this land; and he, Jackson was guilty of a fraud, when he purchased from one who, he ought to have known, had no right to sell him the land. More especially was he reprehensible, when he thus wrongfully pui’chased this land at less than one-half its actual value. If as the result of his improper conduct.he loses his original debt, he should regard this loss as the result of an effort on his part to defraud his debtor, Titcheuell, of an amount not less than the amount of his debt. But there are strong reasons for believing, that if this original debt has not already been fully paid to him by Feather, it will be. The full amount of this debt has been pr will be paid by Titchenell to Feather, it being a lien on this tract of land ; and it is not improbable, that it has already been paid by Feather to Jackson, or if it has not been, that it will be without any controversy or trouble. There is no evidence in this record, it is true, on this subject, and there could be none properly; for it is all foreign to the objects of this suit. Still one can not but suspect this to be the state of the case, because it is obvious, that there is no controversy between these defendants Feather and Jackson, both being rep resented by the same counsel in this Court. Nor was there any sort of controversy between them in the court below; and as Feather either has or will certainly receive the amount of Jackson’s debt against Titchenell, it seems but reasonable to suppose from the relations of the parties, joint appellants in this Court, that Titchenell will, if he has not already done so, pay over to Jackson the full amount of his debt.

But all this is matter foreign to the case before us. To justify the decree of the court below it is only necessary to say, that it had no right in its decree in this cause to have protected Jackson against the supposed or probable fraud of his co-defendant Feather by providing for the payment by Feather to him of this debt, when the purchase-money Feather paid for the land waé refunded to him by Titchenell. It is well settled, that a decree between co-defendants can only be based upon the pleadings and proofs between the complainant and defendants. (Vance v. Evans et al., 11 W. Va. 342.) Under this rule, it is obvious, the Court could not in this case properly render any decree between the co-defendants Feather and Jackson. There is nothing in the bill or in the answer of Jackson, which rendered it necessary or proper in determining the matters in controversy between the plaintiff and the defendants'to enquire into or take any proof whatever relative to any controversy between the co-defendants ; and the proof on this subject has been merely casually thrown into the record and is, or might under such circumstances be very vague and unsatisfactory. The whole proof, on which it is claimed that a decree even in favor of Jackson against his co-defendant, Feather, should he based, is simply the following statement by Payne in his deposition : ■ '

“ Titchenell never offered to pay any of the purchase-money notes which I held until after the second note became due. Soon' after this I learned from Jackson that he had bought the land, and if I am not mistaken he receipted tome for the notes, the debt heing due to him.”

There is no evidence as to the price Jackson was to pay or did pay Feather for this land or anything beyond this vague statement of Payne to show the character of the dealings bet'ween them. There being then in the pleadings between the plaintiffs and defendants nothing whatever to call for any sort of detail as to the dealings between the co-defendants beyond the simple fact, that one of them, Feather, had made a deed to the other, Jackson, for this tract of land, upon the rule and law as laid down in Vance v. Evans et al. 11 W. Va. 342, it is obvious, that it would have been improper for the court in this case to render any decree between them. And had such decree been rendered, great risk would have been run of doing one or the other gross injustice. All the facts necessary to render a decree between them justly were not before the court. It was neither necessary nor even proper, that these facts should have been proven in this cause, as they wmre foreign to the purpose of the suit as shown by the pleadings.

The court therefore did not err in not rendering any decree in this case between these co-defendants or in failing to protect Jackson against the supposed or possible wrongs of his co-defendant' Feather. If they have not settled all matters between themselves amicably or can not do so, they must settle them in some other suit, in which the facts actually hearing on the matters between them may be properly put in issue and proven. It is possible, this might be done in the original suit brought by Jackson, if it is still pending; and if it is not, or if it can not he done in this cause, it may be done in a suit brought for the purpose by him against Feather or by Feather against him ; hut however it may be done, we are safe in saying, it can not be done in this cause, and that therefore there was no error in tlie court below in its failure to provide any remedy over against Feather in favor of his co-defendant Jackson, in case Feather has been or shall be paid the purchase-money of the land by Titch-enell.

The decree of the circuit court, so far as it set aside and declared null and void the deed of September 13, 1881, executed by Feather to Jackson, is affirmed. But the residue of the decree must be reversed because of the errors principally in the manner in which the court has provided for the carrying out of its views, which views are however substantially correct; and this Court in lieu of these provisions should enter a decree, which will provide for carrying out these views in a proper manner. The errors in the court below in this decree of April 19, 1883, consisted in directing a deed from said Feather to Jackson for this land upon or atter the payment of the $208.88, but no proper means was provided for ascertaining whether this $208.83 had been paid, or of ascertaining whether it was to be paid at some future time and when. Eo such conveyance should have been decreed, till the court- had ascertained either by the admission of Feather in open court or by a report of the commissioner, that this $208.83 with interest from April 19, 1883, had been paid, and then it should have ordered this conveyance to be made; and that when made, whether made by Feather or by a commissioner appointed by the court for the purpose, it should contain a covenant of special warranty. And as it appeared that the plaintiff had been turned out of the possession of this land, to which he had an equitable title, by his trustee, the circuit court should have ordered, that the said plaintiff forthwith should have a writ of possession of said land, and should not have postponed his right to sue out such writ, until the plaintiff had satisfied this lien on said land in favor of Feather.

The decree therefore of April 19, 1883, must be affirmed in part and reversed in part as above indicated; and the appellants must pay to the appellees their costs in this Court expended, the appellees being the parties substantially prevailing ; and this cause must be remanded to the circuit court of Preston to be proceeded with according to instructions, which should be inserted in the decree entered by this Court, and further according; to the principles governing courts of equity.

Aeeirmed in Part, Reversed in Part.