16 N.Y. 519 | NY | 1858
Lead Opinion
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *521 It may be assumed, I think, that at the time of the commencement of this suit the plaintiffs were in possession of the premises as tenants in common with the mortgagors of the defendant. This fact is not directly averred in the complaint, but it would seem to follow as a legal deduction from the facts that are averred therein. It is alleged in the complaint that the ancestor under whom the plaintiffs claim to hold by inheritance, died seized in fee of the premises, leaving the plaintiffs, Chapman S. Ward and one other child, heirs-at-law, and that the mortgagors, Chapman S. Ward and the widow, at the time of the execution of the mortgage, although in the exclusive occupation, claimed no interest, nor did they at the commencement of the suit claim any interest in more than an undivided one-half of the land thus mortgaged. There is nothing, therefore, in these allegations to overthrow the presumption that all the heirs remained, at least in contemplation of law, in possession as tenants in common up to the time of the commencement of the suit.
Assuming this to be the relation which the owners of the premises sustained to each other at the time of the execution of the mortgage, we come to the principal question in the case, to wit, whether the mortgage purporting to be executed upon the whole premises created such a cloud upon the title of the plaintiffs as to call for the interposition of the equitable powers of the court to remove it. I do *522 not conceive that the proceedings to foreclose this mortgage can at all affect the question. If the mortgage itself creates no cloud upon the title of the plaintiffs, the proceedings to foreclose the equity of redemption have added nothing to it.
The rule is well settled that when a defect appears upon the face of the record through which the opposite party can alone claim title, there is not such a cloud upon the title as to call for the exercise of the equitable powers of the court to remove it. (Cox v. Clift, 2 Comst., 118; Piersoll v. Elliott, 6 Peters, 95.) But when such claim appears to be valid upon the face of the record, and the defect can only be made to appear by extrinsic evidence, particularly if that evidence depends upon oral testimony to establish it, it presents a case for invoking the aid of a court of equity to remove it as a cloud upon the title. The case of fraud in procuring a deed to be executed which apparently conveys the title, or the case of the sale of land by a sheriff and the execution of a deed to the purchaser after redemption, or a sale upon a paid judgment, is a familiar illustration of a case of the latter kind.
The question then is, to which of these two classes does the case at bar belong. If the ancestor in this case had executed a deed of conveyance to his children of the premises, to be held by them equally as tenants in common, the defect in the defendant's claim to the plaintiffs' portion of the premises would be apparent upon the record, and no one would dispute but that it belonged to the class first above suggested. But I am unable to distinguish such a case from the one before us. It is true the deed, as a mere instrument, is well enough, and no flaw appears upon it, taking it separately from the chain of title of which it forms a link. But looking at it thus, it of course shows no title at all, and would be deemed perfectly harmless, affecting in no manner the title of the plaintiffs. It is only as a link in a chain of title that it can have any effect. It will therefore become necessary for any person claiming under this deed *523 to show the relation which the grantors held to the ancestor who died seized of the premises; and the moment that is shown, the deed, instead of constituting a conveyance of the whole premises, constitutes a conveyance of one undivided half only. I know of no better method of illustrating this than by assuming that the foreclosure is completed by a sale, and that the purchaser brings an action to recover possession. Proof of title in the ancestor, and of the mortgage with the requisite proceedings to foreclose, would show no title at all. There would be a palpable defect in the record, growing out of the want of proof of any title in the mortgagors. It would be manifestly necessary for the claimant to supply this defect. Without evidence to supply it, no one, I think, would contend that there was any cloud upon the title sufficient to call for the aid of a court of equity. A court of law would not hesitate to nonsuit upon such proof of title. But to supply this defect it would be necessary for the claimant to show the relation which the mortgagors held to the ancestor; and then it would appear that they only owned an undivided half of the premises, although they had assumed to mortgage the whole. As soon, therefore, as this relation should be established, the defect in the title of the claimant would be manifest upon the record itself, as clearly as it would if the heirs had claimed under a recorded conveyance to them from the ancestor. It seems to me, therefore, to present plainly a case in which the defect in the claim appears upon the face of the record.
It seems to have been assumed, at general term in the court below, that the mortgagors were in possession at the time of executing the mortgage; and the decision of the case seems to have been based somewhat upon that assumption. I have shown that this assumption is erroneous, but if it is not I cannot perceive how that strengthens the plaintiffs' case. The complaint expressly avers that the mortgagors, at the time of executing the mortgage and up to the commencement of this suit, made no claim of title to any more *524 than their actual interest in the premises. Possession without claim of title is not a very important element in the deduction of title. There is no statute of limitation to the right of entry as against a squatter of that kind.
But if we assume that the mortgagors were at the time of executing the mortgage, and now are, in the exclusive possession of the premises, holding adversely, there would still be no necessity of resorting to a court of equity for relief. The legal action to recover the possession would afford ample relief. It is only parties in possession, or who hold some future estate which gives them no right to immediate possession, upon whom any necessity rests of resorting to a court of equity for aid to remove a cloud from their title. But when they have the right to immediate possession, the common law action of ejectment, as it was formerly called, with a trial by jury, is the proper remedy.
It was suggested upon the argument, in behalf of the plaintiffs, that the purchaser upon the mortgage sale might make the mortgage title the basis of an adverse possession, which, in time, might bar the plaintiffs' right. This point seems to me to be based upon some confusion of ideas. If the plaintiffs are now in possession, I cannot comprehend how any adverse possession can be set up against them so long as they continue in possession. And if they are out of possession, the fear that they will neglect, themselves, to assert their title for twenty years, until their right of entry shall be barred by the statute of limitations, is a species of quia timet for which the principles of equity jurisdiction suggest no remedy. The fear by a party of his own negligence affords no ground of relief in a court of equity; at least, I have found no precedent for such a case.
In fine, I think the cases of Cox v. Clift and Piersoll v. Elliott (supra) were much stronger than the case at bar for the interposition of a court of equity. *525
Upon the whole, therefore, I think the judgment of the general term should be reversed, and that of the special term affirmed, with costs of appeal to the general term.
Concurrence Opinion
The jurisdiction exercised by courts of equity in setting aside and canceling void instruments will appear to be involved in some confusion, unless the proper distinctions are observed. Bills have been filed for the purpose of canceling promissory notes, bills of exchange, policies of insurance, bonds, c., as well as deeds, mortgages and other instruments affecting real estate; and all these have been repeatedly entertained by the courts. There is, however, an obvious distinction between those instruments which merely create a personal claim against a complainant, and those which affect his property, and especially his real estate. The first can rarely do him any injury so long as they remain dormant, while the latter may create such a cloud upon his title as seriously to impair its value.
In the first of these two classes of cases, the question is involved in some doubt, whether courts of equity will interfere to set aside the instrument, where there is a complete defence at law. Lord THURLOW was inclined not to entertain jurisdiction in such cases. (Ryan v. Mackmath, 3 Bro. C.C., 15; Colman v.Sarrel, 1 Ves., 50; Hilton v. Barrow, id., 284.) But Lord LOUGHBOROUGH, afterwards, in Newman v. Milner (2 Ves., 483), and Lord ELDON, in Bromley v. Holland (7 id., 3), and in Jervis v. White (id., 413), took the opposite ground. Chief Baron RICHARDS, also, in Duncan v. Worrall (10 Price, 31), admitted with apparent reluctance that relief might be given in equity against a policy of insurance, notwithstanding it was entirely void at law.
In cases, however, where the title to real estate is or may be affected, it seems never to have been regarded as a sufficient objection to a bill seeking relief in equity, that the complainant has a perfect legal defence. The distinction seems to have been first practically taken in the case of *526 Byne v. Vivian (5 Ves., 604), which belongs to a class of English cases known as the annuity cases. It was a bill to set aside and cancel an annuity bond, and came before Lord Chancellor LOUGHBOROUGH, in 1800. In 1797, three years before, the same learned chancellor had decided the case of Franco v. Bolton (3 Ves., 371), refusing to set aside a similar bond, although void, on the ground that since the case of Collins v.Blantern (2 Wils., 341), the defence was available at law. InByne v. Vivian, however, he sustained the bill and canceled the bond.
On looking into the latter case we see a plain reason for this apparent inconsistency. In Franco v. Bolton the annuity was secured by the mere personal bond of the grantor, while in Byne v. Vivian the bond was accompanied by a mortgage of real estate. The arguments of counsel in this last case are worthy of notice, as initiating, or at least insisting upon, two distinctions, both of which have become a part of the settled law on this subject. The objection to the annuity arose under the act of 17 George III. (ch. 26), called the annuity act, which provided that "a memorial of every deed, bond, instrument, or other assurance, whereby any annuity should be granted after the passing the act, should be enrolled in the Court of Chancery,"c. The memorial in this case was defective and the annuity void. MANSFIELD, for the defendant, insisted that the court ought not to entertain jurisdiction, for the reason not only that there was a good defence at law, but that that defence appeared upon the face of the proceedings under which the defendant must claim. He said: "In this case the proof lies upon the person who wishes to avail himself of the instrument. He must produce a memorial; and if he does not, the other party may get a copy of it from the office."
Sir JOHN MITFORD, on the other hand, pressed the consideration that the securities affected the title to real estate. He said: "This is an incumbrance upon the estate, which cannot be disposed of till this term is disposed of. A court *527 of equity has taken jurisdiction in cases where the security has been void at law. The party has a right to come to have the property cleared, and that the other shall not retain the security merely to keep a cloud upon the title." It goes to show the force of the consideration, that the securities were a cloud upon the title, that it was sufficient, in the view of the chancellor, to overcome the very cogent argument of Mr. MANSFIELD.
The case of Byne v. Potter (5 Ves., 609) arose immediately after that of Byne v. Vivian, and being precisely similar was decided in the same way.
A few months afterwards the case of Bromley v. Holland (5Ves., 610), an annuity case, similar in its features to the two last, came before the Master of the Rolls, who hesitated to follow the decision of Lord LOUGHBOROUGH, and made a somewhat modified decree; but when the case came up on appeal (7 Ves., 3), Lord ELDON, who had succeeded Lord LOUGHBOROUGH as chancellor, reversed the decree of the Master of the Rolls, and made a decree in accordance with the decisions in Byne v.Vivian and Byne v. Potter. In doing this he seems to have been influenced mainly by the distinction taken by Sir JOHN MITFORD, in Byne v. Vivian, between mere personal securities and those which create a cloud upon title. He says: "Whatever difference there may have been in such cases (upon bills of exchange, notes, c.), it seems to me there is considerable difference between the case of a bill of exchange, upon which, on the face of it, there can be no demand, and an instrument which, upon the face of it, purports to affect real property;" but he also said that if the question were res integra his mind "would be considerably affected by the very able argument addressed to the court by Mr. MANSFIELD, in Byne v. Vivian."
That argument would no doubt have prevailed, but for the great weight given to the consideration that the securities cast an apparent shade over the title. The distinction between cases where the invalidity of the instrument appears *528 upon its face and where it does not, is now universally recognized; although Chancellor KENT, in Hamilton v. Cummings (1 John. Ch. R., 517), came to the conclusion, after an elaborate review of the cases, that it was unsound. In Simpson v. Lord Howden (3 Myl. Craig, 99), Lord Chancellor COTTENHAM allowed a demurrer to a bill, filed to set aside an agreement void as against public policy, on the ground that the illegality was apparent upon the face of the instrument. The same has been held in several cases in our own and other American courts. (Mayor, c., of Brooklyn v. Meserole, 26 Wend., 136; Van Doren v. Mayor, c., of N.Y., 9 Paige, 388; Cox v. Clift, 2 Comst., 118; Piersall v. Elliott, 6 Peters, 95.)
But none of these cases contain anything which in the least impairs the doctrine advanced in Byne v. Vivian and the subsequent cases, that a court of equity will entertain jurisdiction of a suit to set aside a deed or instrument, although it may be void at law, provided it purports to affect real estate and will cast a cloud upon it. They merely ingraft upon that doctrine this additional proviso, viz., that if its invalidity appears upon the face of the deed itself, or of the proceedings which the party claiming under it must necessarily produce in order to establish a title, the court will not relieve.
It is suggested that in this case the defect does appear upon the face of the mortgage, as it is not executed and does not purport to be executed by the plaintiffs. That defect, however, does not become apparent until the plaintiffs have first established their title by extrinsic evidence. It is clearly, therefore, not a case where the invalidity of the instrument appears upon its face; neither is it a case in which, in the graphic language of Judge GARDINER, in Cox v. Clift (supra), the plaintiffs have "a perfect legal defence written down in the title deeds of their adversary." None of the cases, therefore, in which relief has been denied upon that ground, have any direct bearing upon this. *529
Does the mortgage in question, then, create a cloud upon the plaintiffs' title? None of the cases define what is meant by a cloud upon title, nor attempt to lay down any general rules by which what will constitute such a cloud may be ascertained. Each case seems to have been decided upon its own peculiar circumstances. There are some things, however, which may be regarded as certain: a cloud upon a title does not mean a legal as contradistinguished from an equitable title; a deed, as we have seen, may constitute a cloud upon the title, although the defence is as perfect in law as in equity. It is to be inferred from the cases, as well as from the natural import of the term, that anything is a cloud which is calculated to cast doubt or suspicion upon the title, or seriously to embarrass the owner, either in maintaining his rights or in disposing of the property.
On the other hand it is equally clear that the mere existence of a deed purporting to convey certain premises, but accompanied by no circumstances giving it apparent validity, would not operate as such a cloud upon the title as to justify the interposition of the court. If an entire stranger assumes to convey the premises to which he has no shadow of title, and of which another is in possession, no real cloud is thereby created. There is nothing to give such a deed even the semblance of force. It can never be used to the serious annoyance or injury of the owner. A word of explanation would dissipate the apparent cloud.
But it may, I think, be safely assumed that when such circumstances exist, in connection with a deed, as not only give to it an apparent validity, but will enable the grantor to make out a prima facie title under it, a cloud is created. It cannot be necessary, to constitute a cloud, that the conveyance should be sufficient per se, without being connected with any other evidence, to make out a prima facie title; because no conveyance, even if valid, could do this. In showing title under a deed by the grantee himself, or in showing that the deed constitutes a cloud upon another's *530 title, it is necessary to show some sort of title, either real or apparent, in the grantor. But is it material in what manner the title of the grantor is shown? Suppose a grantee in a deed, void for some reason not appearing upon its face nor in any of the previous deeds, is able to show a regular chain of conveyances from the people of the state down to his immediate grantor, then, of course, no one could doubt that the deed would constitute a cloud upon the title. But suppose in tracing back the title to its ultimate source, a grantor is found who was, at the time of the conveyance, in actual possession of the premises, is it necessary to go farther? It clearly would not be, in making title under the deed; neither, I apprehend, could it be in showing that the deed created a cloud upon the title. Were it otherwise, a cloud could never be shown short of showing a chain of conveyances from the people down. Can it make any difference, then, how far back it is necessary to go before arriving at a grantor in possession? Is not the evidence of title just as strong in case the immediate grantor, as if any remote grantor, was in possession? There can be but one answer to these questions.
Let us, then, apply these principles to the present case. The mortgagors, owning one-half the premises and being in possession of the whole, execute a mortgage upon the whole. These facts would be sufficient to maintain an ejectment suit against the plaintiffs, and to turn them out of possession. Can it be said that a deed which would enable the grantor to overcome the primafacie evidence of title which actual possession affords, does not constitute a cloud upon the title? It is no answer to say that the plaintiffs, by introducing evidence on their part, could overthrow the title made under the mortgage. This is so in every case where a mere cloud exists.
It is said that, to maintain the suit, the plaintiffs "must be in danger of or must have cause to fear an injury or obstruction to their legal title," and that the fear must be well *531 founded. This position I think unsound. The idea of real danger is not necessarily involved in that of a cloud upon title. If the title is obscured, so as to render the right of the real owner less clear, there is a cloud. If it will embarrass the owner in making a sale of the property, he is injured; and this consideration was urged in the earliest cases on the subject, as will be seen by referring to the argument of Sir JOHN MITFORD, inByne v. Vivian (5 Ves., 604).
Another position taken by the defendant's counsel is, that as the mortgagors and the plaintiffs were tenants in common, the possession of one was the possession of all. This, in my view, is the most plausible answer given to the plaintiffs' case. The complaint, however, avers that the mortgagors were in the sole and exclusive occupation of the premises; and this allegation is admitted by the demurrer. The possession of one tenant in common may be exclusive, where his co-tenant is ousted. The point rests, therefore, upon the distinction between occupation and possession. There is, no doubt, a distinction between the two, because there may be a legal or constructive possession where there is no actual occupation. This, however, cannot, I think, be material in the present case. Suppose an ejectment suit brought upon a claim of title under this mortgage: all that the plaintiff would have to show would be the mortgage and exclusive occupation by the mortgagors. The plaintiffs in this case, having no actual possession, but at most only a constructive possession, would be as effectually driven to the proof of their title, by that evidence, as if there had been no tenancy in common.
The complaint alleges that the defendant has proceeded to foreclose the mortgage, and has obtained the usual judgment of foreclosure; and that he has published a notice of sale in which he describes the entire farm as the premises to be sold. Under these circumstances my own conclusion would have been that the mortgage does create a cloud upon *532 the title of the plaintiffs, and that the judgment should be affirmed; but my associates think that the case does not show, in other words that the demurrer does not admit, that the mortgagors were, at the time of the execution of the mortgage, in the exclusive possession of the mortgaged premises, and, assuming that they are right in this, I concede that the judgment should be reversed.
ROOSEVELT, J., concurred in the opinion of SELDEN, J.; all the others in that of PRATT, J.
Judgment at general term reversed, and that at special term affirmed.