Shelton v. Jones

The opinion of the court was delivered by Stiles, J. — This case does not present the question of the existence of a vendor’s lien in behalf of the vendor of real estate in the state of Washington. The equitable lien of a vendor is often confused with the security which the vendor preserves to himself by retaining in himself the legal [696] title until the payment of the purchase money. This has been done in this case. The legal title to the property never passed, the instrument which created the relations which existed between the parties being only a bond or agreement for the sale of the property at a future day on payment of the notes given for the purchase price. A vendor’s lien is one which is created by operation of law as an equitable security to the seller of land. The lien which exists in this case, if any, is only one of contract and the vendQr retaining the legal estate has a right to and in the land under which he might have maintained ejectment for the recovery of possession. He might have sued at law on the notes given for the purchase money, or he might seek to foreclose it in equity as he has done, or might even pursue these remedies concurrently. Bankhead v. Owen,, 60 Ala. 457. The complaint shows that Shorter, to secure a claim of twelve hundred dollars and interest due Shelton, executed a mortgage to him of the Central hotel property, subject to-a contract of Shorter and Read with Jones; and it also alleges that he assigned his two notes to Shelton as further security. We think this fully authorized Shelton to maintain this action. From the allegations of the complaint we gather that Shelton had actually become the owner of the notes. The notes taken in such a case carry to the assignee of them the right to maintain a contract lien for the purchase money. Burkhart v. Howard, 14 Or. 39. Code Proc. § 149, provides for just such cases. The only error we find in the case so far as Shelton and Shorter are concerned is, that Shelton is given a judgment against Shorter. The suit was to foreclose a lien, and if Shelton was the owner of the notes, he was a proper party to prosecute the foreclosure, whether his debt from Shorter was due or not. Shorter was also a proper party, though perhaps not a necessary one, because he had an interest [697] in the surplus after the payment of Shelton’s debt. We think that the decree should have been that David Shelton should recover the full amount under the contract to Shorter, and that Shelton and Shorter should be left to arrange their affairs between themselves. Jones, certainly, had no interest in their contracts. The only remaining matter to be disposed of is that concerning the sale of the property ordered in the decree. The court ordered that the real estate and personal property be sold in accordance with the law governing the sale of real property on execution. The contract was for the sale of lot six, block ten, of Frances Shelton’s addition to the town' of Shelton, known as the Central hotel property, with the furniture and upholstery and appurtenances thereunto belonging. The contract of sale was for the gross sum of seven thousand dollars, three thousand dollars cash and four thousand dollarsupon deferred payments evidenced by notes. Immediately upon the execution of the contract, and the payment of the cash, the purchaser went into possession. Now the rule of law is, that the vendor of personal property in parting with the possession, and especially upon taking notes for the purchase price, waives his fight to a lien, and so in this case, had there been nothing between the parties but the contract for the sale of the furniture and upholstery of the hotel we think the delivery and takingof the noteswould have extinguishedtherightto lien. But the courts have recognized that the intention of parties should have some weight in the settlement of such matters, and wherever they find that the parties have contracted for a lien, or substantially a chattel mortgage, or that the title shall not pass untilpaymentismade.theyuphold the lien. Gregory v. Morris, 96 U. S. 619. So in this case the contract provided for the execution of a conveyance ortransfer when the notes should be paid. The property was of such a character that it would not be likely [698] that the personal property would be separated from the real. Moreover, the contract being for a gross sum, if this were a case of an ordinary vendor’s lien the failure of lien upon the personal property would destroy that upon the realty. Stringfellow v. Ivie, 73 Ala. 209. We therefore hold that in this case the lien continued upon the personalty as well as the real estate, but we cannot agree that property of this kind is like a steamboat, which is ordinarily sold with all the apparel, furniture, tackle, etc. There is no greater reason why the furniture of a hotel should not be sold as personal property than there would be for applying the same rule to a dwelling house. There was no error in rendering judgment upon the notes which were due, and suspending judgment on the remaining notes until their maturity. The decree should be in favor of Shelton as legal owner of two notes, leaving him and Shorter to their own adjustment; and the personalty should be sold first, as personal property is required to be sold upon execution. Let a new decree be entered in the superior court accordingly-Costs to the appellants. Anders, C. J., and Hoyt, Dunbar and Scott, JJ. concur.