Irwin v. Bailey

BRICKELL, C. J. This is a bill for the specific performance of a contract, by which the appellant bound himself (to follow the words of the contract), “ in consideration of Raving gave to my late daughter, Mary Bailey, certain moneys, part of which she returned to me, at or shortly after the time I purchased the farm on which I now reside,” to convey to the ap-pellee, the husband of said Mary, certain lands, and agreed to give him “ one-half my live stock and farm implements, reserving the mower, rake,'huller, two-horse wagon and cart,” upon the following conditions as expressed in the writing: “ he, the said Bailey, to pay off the mortgage for three thousand dollars that now stands against my property, and if judgment is obtained against me in a suit now pending, wherein Rowland & Co. are plaintiffs, he to pay one-half the amount; he to lift the mortgage within the present year, and I to make him a deed for the properties when he is prepared to lift the mortgage,” &c. The material facts are, that in October, 1863, the appellant, then residing in the State of Illinois, conveyed to liis daughter and only child, Mary, a tract of land there situate. The deed is an ordinary conveyance of bargain and sale, upon a recited consideration of seven thousand dollars. In April, 1864, the said Mary intermarried with the appellee, and thereafter she, with the appellant and appellee, resided in Illinos until the latter part of 1865, when a sale of said lands was made lor ten thousand dellars, and the parties removed to Philadelphia. The proceeds of the sale of the lands were invested in United States bonds, which were placed in the exclusive possession of Mrs. Bailey, and which she and the appellee recognized and treated as her sole property, he not asserting any claim thereto. In February, 1866, the appellant purchased a tract of land situate in the county of Madisoir,. in this State, of which the lands now in controversy form a part, for the sum of thirteen thousand dollars; of which, three thousand dollars wTas paid in — 471 — cash; four thousand eight hundred and fifty dollars was paid March 1st, 1866, and the remainder, with interest, was payable two years thereafter. In making the two first payments, and in paying for the purchases of stock and farming utensils to be used in cultivating the lands, the appellant obtained from Mrs. Bailey the sum of sixty-seven hundred dollars, which she derived from a sale of the United States bonds. Soon thereafter Mrs. Bailey removed from Philadelphia; and from thence she and the appellee resided with the appellant on said lands, until her death in 1873. She died intestate, leaving surviving her an only child. In 1869, the appellant made final payment of the purchase-money of the lands, and received a conveyance, borrowing about three thousand dollars to make the payment, and executing a mortgage on the lands to secure the payment. There was with Mrs. Bailey and the appellee much dissatisfaction, because the conveyance of the lands was taken in the name of the appellant, and because there was no writing disclosing that she had an interest in the lands and other property, or that money of hers had been used in paying the purchase-money. The principal object of the contract now sought to be enforced, was the quieting and silencing all further controversy in reference to this matter. After having been notified by the appellant that he would refuse to carry the contract into execution, the appellee paid the mortgage debt referred to in the contract, and satisfaction of the mortgage was entered upon the record. The mortgage was then surrendered to the appellant, and received by him, because the mortgagee was unwilling to deliver it to any one else. The suit in favor of Bowland & Co. was pending and undetermined when the bill was filed, and at the hearing of the cause. The evidence as to the value of the property agreed to be conveyed, is conflicting, the witnesses differing in their estimates. The weight of the .evidence shows, we think, that it was not of less value than six thousand dollars. The chancellor decreed a specific performance of the contract, and from the decree this appeal is taken. The principles upon which a court of equity exercises its peculiar jurisdiction to enforce the specific performance of contracts are well known, and have been of frequent consideration and application in the past decisions of this court. The court will not intervene, unless the contract is fair, just, reasonable, and equal in all its terms and parts; is founded upon an adequate consideration, and its specific execution is free from hardship and oppression. If, on either of these points, there be a well founded objection, the court abstains from interference, leaving the party complaining of a violation of the contract to the remedies afforded him in courts of law. In the exercise of the jurisdiction, the court is invested with a discretion ; not ar — 472 — bitrary or capricious, but a sound, judicial discretion, moulding and tempering its action, or the refusal to act, in view of the circumstances of the particular case, and from them, determining whether the conscience of the party charged with a violation of the contract is so affected, that moral and equitable duty compel him to a strict performance, rather than to a payment of such damages as a court of law would award against him. A primary duty of the court is to examine the contract, not merely as a court of law would examine it, to ascertain what the parties have in terms expressed, but what in truth was the real intention of the parties, and to carry that intention into effect; or, if it can not be carried into effect, to leave the parties to their legal’ remedies.—Hipwell v. Knight, 1 Y. & C. Exch. 411. There is no class of cases, to which the jurisdiction of a court of equity extends, that the maxim “ he who seeks equity must do equity,” is more rigidly applied. Hence it results, that the' contract or agreement which the courtis asked to enforce specifically must not only be certain, fair, just, reasonable, and equal in all its parts and terms, must not be merely voluntary, but founded upon a valuable and adequate consideration; and it must be mutual in its operation and effect. As is said by Prof. Pomeroy, “ The contract must be of such a nature that both a right arises from its terms, in favor of either party against the other, while the corresponding obligation rests upon each towards the other; and also that either party is entitled to the equitable remedy of a specific execution of such obligation, against the other contracting party.” — Pomeroy on Contracts,. § 162. Or, as is said in another work: “ A contract, to be specifically enforced by the court, must be mutual — that is to say, such that it might, at the time it was entered into, have been enforced by either of the parties, against the other of them. Whenever, therefore, whether from personal incapacity, the nature of the contract, or any other cause, the contract is incapable of being enforced against one party, that party is equally incapable of enforcing it against the other, though its execution in the latter way might in itself be free from the difficulty attending the execution in the former.” — Fry on Specific Performance, § 286. “ I have no conception,” said Lord Redesdale, in Lawrence v. Butler (1 Sch. & Lef. 13), “ that a court of equity will decree a specific performance, except when both parties had a right by the agreement to compel a specific performance, according to the advantage which might be supposed to have been derived from it.” Were it otherwise, a specific ¡Performance might be decreed, when, if it was disadvantageous to the party complaining, he could not, at the instance of the other party, be compelled to perform. There are some cases, in which a want of .mutuality in the — 473 — contract, at the time it was entered into, is not regarded as an insuperable obstacle to specific performance.; these rest upon their own peculiar circumstances and facts. Performance by the one party, and its acceptance by the other, may entitle the party performing to the assistance of the court, though he could not have been compelled to perform. The contract of an infant is voidable; but, after the arriving at age, he may affirm and enforce it, notwithstanding the original want of mutuality. The class of cases to which we refer are exceptions to the general principle, and involve considerations which justify the court in the specific performance of the contract. But, when the contract, in its nature and character, and according to the intention of the parties, involves and imposes a reciprocity of obligation and duty, there is no authority for enforcing specific performance of it, in favor of a party, who, on his part, has not performed, can not be compelled to perform, and is not capable of performing.—Cooper v. Pena, 21 Cal. 404. He has not done, and can not do equity, and is not in a situation to invoke the aid of the court. Applying this principle to the facts of this case, leads necessarily to the conclusion that specific performance of the contract can not be decreed. The main inducement to the contract, the controlling purpose of the parties, was the settlement and adjustment of the rights accruing to Mrs. Bailey, because of the moneys of hers which had been employed in making payments for the lands, and for the stock and farming implements purchased to cultivate them; and to relieve the appellant from all corresponding liability. This is apparent from the words of the written agreement, when these are read in connection with all the facts'and circumstances. The consideration it recites is certain moneys the appellant had given to his daughter, a part of which she returned to him, at or shortly after he purchased the lands. Upon this consideration. he agrees to convey the property on the performance of certain conditions by Bailey; and these conditions are the payment of the mortgage debt, and one-half of the judgment which might be obtained in the suit of Howland & Co. There was no sale of the property intended, for the sums necessary to pay these demands, which were not a fair equivalent for the property; in no just sense did these sums constitute the price, or purchase-money of the property. The quieting and silencing all future and past controversy growing out of the use of the money of Mrs. Bailey, was the material element of consideration, and the real, controlling intention of the parties. It is not necessary to examine the evidence, proceeding largely from the immediate parties, embarrassed in irreconcilable conflict (which, it is hoped, results rather from an honest misunderstanding or misinterpretation of facts, than from intentional, deliberate misrepresenta — 474 — tion), and determine whether the moneys were loaned to the appellant, or contributed or advanced as a definite share of the purchase-money of the property, with the intention that in the property Mrs. Bailey should have a corresponding interest. If there was a loan, the purpose was its payment; or, if there was a trust created in, and attaching to the property, the purpose was its extinguishment; in the one aspect, acquitting and discharging the appellant from all personal liability; in the other, relieving the property he reserved from the operation of the trust. The tie or obligation of the contract, to which the appellant is subjected, is the conveyance of the property upon being discharged and acquitted of all personal liability for the loan; or, if it was not a loan, upon an extinguishment of the trust, if any wras created, and upon the payment of the mortgage debt. The tie or obligation' to which the appellee was subject, was the satisfaction of the loan, or the extinguishment of the trust, and the payment of the mortgage debt and one-half of the judgment Rowland & Co. might obtain. The tie or obligation was reciprocal, or the contract is wanting in mutuality, in fairness and justice; for no contract can be deemed fair and just, that is not reciprocal in its obligation and duties — that does not yield to each party the rights or benefits it is intended to confer. If there were statutes in Illinois, or in Pennsylvania, when Mrs. Bailey and her husband were domiciled in those States, which operated a change of the common law as to the condition of the property of the wife, or of the marital rights of the husband, of them there is not in the record pleading or evidence. The presumption is, therefore, that the common law prevailed in each of those States. That presumption is indulged in reference to all sister States having a common origin with our own, until the contrary is shown by pleading and proof. The lands in Illinois not having been conveyed to the sole and separate use of Mrs. Bailey, by the marriage, at common law,, the husband became seized thereof, entitling him to take the rents and profits during the joint lives of himself and wife, and by possibility during his own life, if he was the survivor. "When,, by sale, and by the conveyance of husband and wife, the lands were converted into money, if, without any particular agreement, the wife had permitted the money, which, in the language of Sessions v. Sessions (33 Ala. 522), was new property, to pass into the possession of the husband, the money, like any other personal property of the wife’s when reduced to possession, would have become his property. — 1 Bish. Mar. Women, § 605. But the money never passed into his possession; over it he claimed or exercised no control whatever. The evidence shows, very clearly, that intentionally Bailey abstained from exercising — 475 — or claiming any dominion whatever over the money received from the sale of the lands, or of the United States bonds, in which it was subsequently invested; that he elected his wife should hold and treat it as her own. Not only was there by his conduct a renunciation of all ownership and dominion, and a recognition of the sole and exclusive ownership and dominion of the wife, but, according to his evidence, he gave to her United States bonds, of near the value of three thousand dollars, derived from a sale of his own personal property, made at the same time of the .sale of the lands, and to the same purchaser. "While, at common law, the husband could, by' a reduction to possession of the personal property of the wife, convert it into' his own absolutely ; or, if it was in the possession of the wife, her possession became, and was in contemplation of law, his possession; yet, he was not compelled to an assertion of his marital rights. The personal property of the wife, in her possession at the time of the marriage, or possession of which she subsequently acquired, he could refuse to take and hold; or, taking and holding it, he could elect to take and hold it as her trustee. Or, if the property was ohoses in action, he could refuse to exercise his marital right and power of making them his own, by a reduction of them to possession. In either of these events, the property remained unaltered — the property of the wife, passing to her personal representative.—Jennings v. Blocker, 25 Ala. 415; Gillespie v. Burleson, 28 Ala. 551; Machen v. Machen, 38 Ala. 364. Such was as necessarily and essentially the result, as if, after reducing the property to possession, converting it into his own, the husband had made a gift of it to the wife, which was construed as a gift to her sole and separate use.—Williams v. Maull, 20 Ala. 721; McWilliams v. Ramsey, 23 Ala. 816. Upon the United States bonds, and upon the money derived from their sale, by the law of the domicile of husband and wife, was impressed the separate ownership of the wife; and the ownership was unchanged by their subsequent'removal to, and acquisition of a domicile in this State.—Doss v. Campbell, 19 Ala. 590; Drake v. Glover, 30 Ala. 382. The wife having died intestate, if the money was loaned to the appellant, the exclusive right to recover or receive payment of it would pass to her personal representative. If there was a trust created in and to-the lands, it would devolve by descent on her child, her only heir at law. The moneys being the separate estate of the wife, and not of her statutory separate estate, Bailey, as husband, had no interest in them ; he was not a dis-tributee of the personal estate of the wife, nor in any sense her heir at law. The obligation of the contract to which he is subject, he can not therefore perform; a decree compelling him to — 476 — performance would compel him to do an act which he is without legal capacity to do. And if the appellant were compelled to performance, he would be deprived of the property for but little more than half of its real value, would not be freed from personal liability for the money, if it was a loan ; or, if not a loan, and a trust was created, the trust would remain unextin-guished, attaching to and incumbering the property he reserved. Under these circumstances, the court can but see that it would not really do that complete justice which it aims at, and which is the foundation of its jurisdiction to decree specific performance.—Harnett v. Yielding, 2 Sch. & Lef. 548. ' “ Ordinarily, when a bill is filed for specific performance, and it is dismissed, nothing more is settled by the decree, than that the case is one in which equity will not interpose its extraordinary powers. But there are cases in which the decree may deny a specific performance, and also give relief, or great injustice would be the consequence.”—Mialhi v. Lassabe, 4 Ala. 712. A case of this kind occurs, when the purchaser of lands has been let into possession, and has made valuable improvements. There may be well grounded objections to a decree of specific performance, and yet, in such case, his bill would be retained, and a decree rendered giving to him just compensation for the improvements. Or, he may have paid part of the purchase-money, and fail to make a case entitling him to specific performance ; yet, if he has not a full and adequate remedy at law, the bill will be retained, and a decree rendered for the money paid.—Aday v. Echols, 18 Ala. 353. In this case, it is but just and equitable that the appellee should be subrogated to the security of the mortgage, which by payment he removed as an in-cumbrance upon the property. In a court of law, the subrogation would not be decreed ; it is only in a court of equity it can be obtained. The decree of the chancellor must be reversed, and a decree here rendered in conformity to this opinion.