Houston v. Farley

Evans, P. J. (After stating the foregoing facts.) A ground of the demurrer raises the point that the oral contract of which specific performance is sought.is within the statute of frauds. The plaintiff contends that the statute does not apply to a case as alleged in the petition. He bases such contention on the dictum of the first headnote in the case of Chastain v. Smith, 30 Ga. 96, that “Where one person agrees, as agent, to buy land for another as his principal, and does buy it, but takes the title in his own name, this title in his hands stands affected with a resulting trust for the benefit of the principal by operation of law, and the case is not within the statute of frauds, resulting trusts being expressly excepted from the operation of the statute.” In discussing this ruling, Bleckley, C. J., said, in Roughton v. Rawlings, 88 Ga. 819 (16 S. E. 89): “But the facts in Chastain v. Smith did not require the court to determine whether there was a resulting trust or not. . . Strike this fact out of the case, and there would have been a very different question before the court from that on which the decision could be upheld with this fact in it. The case itself was decided correctly, but the reason suggested in the first headnote is not applicable to the facts as a whole, nor sustainable.” There is a clear distinction between cases where equity will enforce a trust at the instance of a principal against his agent who, being commissioned to buy a piece of property, does buy it and takes title in his own name, and eases where a trust results solely by operation of law. In the former case the agent will be compelled [824] to transfer to the principal the benefit of his contract, upon repayment of the purchase-money and necessary expenses. Forlaw v. Augusta Naval Stores Co., 124 Ga. 261 (6), 262 (52 S. E. 898). A resulting trust which arises solely from the payment of the purchase-price is not created unless the purchase-money is paid either before or at the time of the purchase. Hall v. Edwards, 140 Ga. 765 (79 S. E. 852). When the person who sets up a resulting trust has in fact paid no part of the purchase-money, he will not be allowed, under the statute of frauds, to show by parol that the purchase was made for his benefit. No resulting trust can arise from the payment of money after the purchase has been completed. The plaintiff is not contending that the defendant was to purchase the property in the plaintiff’s name, but that the' defendant, having purchased the land, would sell it to him on credit according to stipulated terms. Such a contract is within the statute of frauds, which requires every contract for the sale of lands or any interest in or concerning them to be in writing and signed by the party to be charged therewith or some person by him duly authorized. Nor is such contract, under the allegations of the petition, enforceable on the doctrine of trust, or on the ground of fraud and part performance. Roughton v. Rawlings, supra; Lyons v. Bass, 108 Ga. 573 (34 S. E. 721). Judgment affirmed. All the Justices concur.