Pinney v. Fellows

The opinion of the court was delivered by Bennett, J. The object of this bill is the protection of a trust estate, of which it is claimed Elizabeth N. Pinney, the wife of Martin Pinney, is possessor ; and the important inquiry is, has she established in herself such a trust interest as can, upon the principles of chancery law, be recognized, protected and enforced against these defendants ? This case, in principle, is somewhat important; and w.ith the aid of a very full argument, we have endeavored to arrive at a just conclusion. At law, the legal existence of the wife is suspended, or rather consolidated with the person of her husband, during the marriage ; and from this supposed union almost all her disabilities at law follow. The civil law never adopted this fiction ; but it permitted the husband and wife to have separate estates and interests. So, in courts of equity, the husband and wife are, for many purposes, regarded as distinct persons, capable of distinct and separate interests. But, as her person, at law, by fiction, is merged in that of her, husband, she must look to courts of equity for the protection of her separate interests. It appears from the testimony, that in 1824 the husband of Mrs. Pinney was very intemperate, poor, and destitute of the means of providing a support for himself and family. In this situation, she made a contract with Asa Aikens for the purchase of the premises, the title to which is now in question ; and she made it professedly in her own right, and for her separate interest, that she might have a home for herself and children; and declined to have the deed given to her husband on account of his embarrassed situation. It was understood between her and Mr. Aikens, at the time the contract was made, that Mrs. Pinney was to pay for the place out of her own means, a portion of which she expected to inherit from her mother’s estate. When Mr. Aikens executed his deed, in March, 1824, by'an agreement between — 536 — Mr. Aikens, Mrs. Pinney, and her son, Wm. H. H. Pinney, jt was-gjven to the son, in the usual form, for a consideration, as expressed in the deed, of 400 dollars, under a verbal agreement, on the part of the son, that he would hold the premises for the sole and separate use of his'mother. Upon the execution of the deed, Mrs. Pinney paid one hundred dollars of the consideration money, and the son gave his notes to Mr. Aikens for the balance and a mortgage on the place to secure them, but with the understanding that his mother would furnish the means to pay the notes. It is evident from the testimony that the $100, paid by Mrs. Pinney, upon taking the deed, was her money, obtained by way of loan from her brother for this express purpose. Mrs. Pinney afterwards paid about one hundred dollars on her son’s notes, in boarding and nursing the aged father of Mr. Aikens; and we have no doubt, from the testimony, the balance of the notes were paid by Mrs. P. from time to time, from the moneys obtained from her mother’s estate, and from her own personal earnings. The son testifies, expressly, that he' never paid anything towards the land, unless it was by way of loan to his mother, and for which he has been paid by her. As the whole testimony shows old Mr. Pinney, during the whole time, to have been exceedingly poor and worthless, there can be no good reason to suppose that he could have furnished any part of the money. But it is urged in argument, that, notwithstanding such may have been the facts, as to the manner in which MrAikens received his pay for the land, yet, that the moneys and the earnings of the wife before the payment, vested, absolutely, in the husband, and became his property, and, consequently, furnish no ground for creating a trust to the wife. But, in chancery, the husband and wife are distinct persons, and in a limited sense, may contract with each other ; and it will always refuse its aid to the husband to obtain the possession of the separate property of the wife, unless it be upon a competent provision for her support. The husband is bpund by the principles of the common law to yield the wife a competent support, and this duty is not dependent upon the receipt of property by the husband from the wife ; and if, after marriage, he shall, for sufficient reasons, contract with the wife that she may possess and enjoy separately, — 537 — property bequeathed to, or inherited by her-, or such as she may be the meritorious cause or acquiring, equity will uphold such post-nuptial agreement, in cases in which the claims of creditors will not be prejudiced by so doing. Hanning v. Style, 3 Peere Wm’s. 334; 1 Fonb. Eq. B. I, Ch. 2, §6, note (n.) ; 2 Story’s Eq. 601. It would seem, that chancery would need no better reason for upholding a post-nuptial agreement, as between husband and wife, (which was intended to give a home to the wife and family,) than the entire worthlessness of the husband, and his neglect to discharge the marital obligations imposed upon him by law. It is, however, argued, that there is no evidence that this trust estate in the wife was attempted to be created to her separate use, by the appropriation of the moneys of the wife, and the avails of her own earnings, by and with the husband’s consent. But we think otherwise. In 1823, the husband and wife, under a contract between the wife and Mr. Aikens to pay rent, and in anticipation of a future purchase, went into possession ; and in 1824 the contract of purchase was made. The deed was then made and put upon record. The one hundred dollars was then paid, and subsequently the residue of the consideration. The rent for 1823 was also settled. The husband and wife continued to live on the premises until after the attachments by the defendants, a period of more than thirteen years, without the payment of rent, and without any question of their right; after which they removed to one of their sons, on account of the husband’s infirmities, and the inability of the wife longer to have the personal charge of him — the same son then taking charge of the premises. We can hardly conceive it possible, that the old gentleman should not have fully understood the manner in which a home had been provided for himself and family for so great a length of time. He well knew he had made no purchase himself, and that he paid no rent. He must have known his wife was boarding and nursing the father of Judge Aikens, a year or more, for which they were entitled to compensation ; and it is highly reasonable to suppose he must have known his wife was in the receipt of moneys from her friends. We can not doubt the husband was fully advised of all that Mrs. Pinney had done in relation to this business. We, hear of no dissent or — 538 — dissatisfaction on his part; and, indeed, he joins with her in then find, as a fact proved, that all which was ^one by the wife, was done with the consent of the husband, and designed to create a trust for the separate use of the wife- Though the legal interests in the consideration paid might have been in the husband, yet the wife, being the meritorious cause, by which the means of payment were provided, and these being appropriated to create the trust estate for the wife, by the husband’s consent, though void at law, yet, still, in equity the arrangement should be upheld, if it can consistently be done. This brings us to the question, whether a valid trust has been created in favor of the wife, and if so, whether it can be enforced against these defendants. It is a familiar principle in equity law, that when one person purchases an estate in lands with his own money and takes the deed in the name of another, a trust results, by operation of law, to the person paying the consideration ; and such a trust is expressly excepted from the operation of the statute relative to the conveyance of lands, and of course may be proved by parol. It is said in argument, that, as the deed to the trustee expresses the consideration to have been received by the grantor from the trustee, it is not open to parol evidence to show it otherwise. It is true, that there are authorities which countenance the idea, that if the consideration money is expressed in the deed to have been paid by the person to- whom the conveyance is made, and there is nothing in the deed to create a presumption that the purchase money belonged to another, in such case, parol proof should not be received after the death of the nominal purchaser, to prove a resulting trust. But this is not such a case. Wm. H. H. Pinney, the nominal purchaser from Judge Aikens, is still living ; and though he is not a party to this bill, yet we have his deposition before us, which fully proves the trust. Though it has been a matter of some controversy whether, after the death of the supposed nominal purchaser, parol proof alone is admissible against the express declaration in the deed, yet, even in that case, I think the better opinion is, that it may. See Sugden on Vendors, 256-260, 10th ed.; 2 Story’s Eq. Jurisp. §. 1201, note 2; Lench v. Lench, 10 Ves. 517; Boyd v. McLean, 1 Johns. Chan. 582; Gascoyne v. Thwing et L — 539 — al. 1 Vern. 366; Parol evidence has, in such case, been admitted to show the trust, against the answer of the nominal purchaser. In this the nominal purchaser admits the facts fully, from which the trust is implied ; and, in such case, there is no danger from the adoption of such a principle. And I think, the law, in such case, is well settled, that the facts which create the trust may be shown by parol evidence, though it contravene the recitals in the deed. If, then, Mrs. Pinney had, at the time of the purchase, paid the full consideration money, the law, out of that feet, would have raised the trust. Though it has been sometimes questioned, yet it is now w'ell settled, that a part payment of the consideration, at the time of the purchase, will charge the land with a trust pro tanto. Bostford v. Burr, 2 Johns. Ch. R. 410; Ryal v. Ryal, 1 Atk. 59; Bartlet v. Peekersgill, 4 East. R. 577, in note; and Lane v. Diton, Amb. 409. So far, then, as respects the one hundred dollars, a trust resulted to Mrs. Pinney against the nominal purchaser, which is out of the statute of frauds, and is a charge upon the land. It is an important inquiry, whether a trust is created as to the residue, which fixes itself upon the land, as a valid trust between the parties to this suit. The parties did not rely upon the law of implied or resulting trusts, but there was an express agreement creating the trust. If the trust, attempted to be created, comes within the statute of frauds, it must fall. It cannot, in that event, be supported by parol evidence, however explicit it may be. The statute of 1797, by which the rights of the parties are to be governed, (Slade’s Ed. p. 166) declares, “that all declarations and creations of trusts or confidences, of any lands, &c., shall be manifested and proved by some writing,” &c., except such as arise by implication of law, or the same shall be utterly void. Our statute, in effect, is a copy of the 7th and 8th sections of the 29th Charles II.; and has been adopted by most of the states. The authorities under the statute of Charles II. are authorities for us. Is the trust, then, in this case, so proved and manifested as to take the case out of the statute? The statute does not require the trust to be created by writing. All that the statute requires is, that it shall be manifested and proved by writing. This has been the construction of the statute of Charles II. Forster v. Hale, 3 Ves. 696. — 540 — Randall v. Morgan, 12 Ves. 73. So it has been held in New York, under their statute, which is, in effect, a copy of the English statute. Movan v. Hays, 1 Johns. Ch. 342; Steere v. Steere, 5 Johns. Ch. 1. The question then arises, is the deposition of the nominal purchaser, drawn up, signed by him, and sworn to, fully admitting the trust, such a manifestation and proof of it in writing as to render the trust valid? In Ryal v. Ryal, 1 Atk.. 59, it was held that the admission of the trust, in the answer of the trustee, took the case out of the statute, or rather was a sufficient manifestation of the trust in writing. In Ambrose v. Ambrose, 1 Peere Wm’s. 322, the declaration of the trust was not given by the trustee, till after the death of the cestui que trust; yet it was held binding upon the widow of the trustee. In Lane v. Diton et al., Arab. 409, it was held to be clear law, by Lord Hardwick, that, if the trustee lays out trust money in land, the court will charge the land wdth it, upon the admission of the trustee. In that case, it appeared from papers in the hand writing of Diton, and signed by him, who had been permitted by the trustee to manage the trust stocks, that they had been sold, and the moneys laid out, from time to time, in the purchase of land. The land was charged with the trust money, without any writing creating the trust. We think, then, that the deposition of the trustee signed and sworn to by him, fully and clearly setting out the terms of the trust, is a sufficient manifestation of it, in writing; and had the bill been against the nominal purchaser, chancery would have enforced the trust against him, upon the answer. The question then arises, in what light do these defendants stand ? Are they in a better situation than the nominal purchaser? Wm. H. H. Pinney, in 1834, had, upon a nominal consideration, conveyed to J. N. Pinney; and in 1836, the latter, upon a like consideration, conveyed to Haskell Pinney; but both deeds were executed without a seal and are unrecorded ; and both were given with the consent of Mrs. Pinney, and with the express agreement that the lands should be held upon the same trust as when in the hands of William. The defendants, after the pretended conveyance from Wm. to J. N. Pinney, attached the lands as the property of William, and in June 1836, caused them to be appraised off, on their execution against William ; and — 541 — the object of their action of ejectment is, by means of this title, to get the possession of this land. Mrs. Pinney and her husband had been in the actual and exclusive possession of the premises, for about thirteen years previous to the attachment, managing them as their own. William H. H. Pinney never was in possession, and had no concern in their management. Though he had the legal title, and a seizin in law, yet, in equity, the cestui que trust was seized of the freehold, accompanied with an actual seizin. It is a general rule, both at law and in equity, that the open and exclusive possession of land is notice to a purchaser of the possessor’s title. In Rublee v. Mead, 2 Vt. R. 546, the rule was applied at law, and effect was given to an unrecorded deed by reason of this principle, against an attaching creditor. There was no attempt, in that case, to prove an actual notice. The case of Griswold v. Smith, 10 Vt. R. 454, is to the same effect. Possession is there called constructive notice. The general rule is, that whatever is sufficient to put the party upon an inquiry is good notice in equity. Smith v. Low, 1 Atk. 490; Ferrars v. Cherry, 2 Vern. 384; Taylor v. Hebbert, 2 Ves. 437; Daniels v. Davison, 16 Ves. 250; Allen v. Anthony, 1 Meriv. R. 262; 2 Story’s Eq. Jurisp. 389, § 400. In Plumb v. Flint, 2 Anstr. 438, Lord Chief Baron Eyre says, constructive notice cannot be rebutted; and in Daniels v. Davison, the Lord Chancellor says, possession is notice to a subsequent purchaser of the equitable rights of the tenant. The case of Pritchard v. Brown, N. H. R. 397, is strongly in point. The cestui que trust was in the open and exclusive possession of the land, and it was held this was sufficient to charge the purchaser with notice of his trust estate, and avoid the deed of the trustee. If, in such case, the purchaser does not inquire, it is crassa negligentia; and he shall be presumed to be cognizant with the facts. 2 Fonb. Eq. 151, and note m. Though the defendants, in their answer, deny all notice of the equitable claims of Mrs, Pinney, at the time of the attachment, yet this cannot avail them. Her possession is, in effect, notice, pé'r se, in equity, of her equitable estate; and the same consequences flow from it as would flow from an actual notice, unless it be as to guilt. Sheldon v. Cox, Amb. 626. Besides, notice, in point of fact, of her equitable — 542 — claims, at the time the defendants extended their execution on the land, is not denied in the answer. If it was important, it might well be inquired, whether the defendants can claim to stand as purchasers before that date; and if not, as notice is alleged in the bill, and not denied in the answer, it is to be taken that they were purchasers with actual notice. It is said this is breaking in upon our registry act, and that this is not to be done unless the notice is so clearly proved as to make the act in the second purchaser, fraudulent in fact. But Mrs. Pinney has, in this case, an equitable estate in lands, which is not required to be created, in writing, or* to appear upon the town records, where conveyances of lands are to be recorded. So far as her claim can stand upon the ground of a resulting trust, it is expressly excepted out of the statute; and as to the residue of her claim, and, indeed, as to the whole, there has been such a manifestation and proof of the trust, as to render it valid, though not created by deed, or in writing. Why, then, should we be called upon to hold that a trust interest, which is not required to be recorded or even created in writing, may be defeated by a purchase from the trustee, and that, too, in a case in which the purchaser has implied or constructive notice? See Pratt v. Bank of B. 10 Vt. R. 293. To give such effect to the registry act, would be, indeed, to call it in to aid in the protection of fraud, rather than in its prevention. In Rublee v. Mead, 2 Vt. R. the person in possession holding an unrecorded deed, prevailed against an after attaching creditor of his grantor, upon no other evidence of notice but what arose from the possession of the grantee. In Wright v. Bates & Niles, 13 Vt. 350, the orator had conveyed to Bates, by an absolute deed, which was put on record, but which in fact, was but a security for a loan. Wright continued in possession, as before- and while thus in possession, Bates, for a valuable considertion, conveyed to Niles. Though Bates had a perfect title of record, yet Wright was let in to redeem, even against Niles. An equitable interest in lands was there protected in chancery, against a subsequent purchaser, without notice, though created by means of a parol agreement with the accompanying circumstances of that case. It has been urged in argument, that, in this case, there — 543 — was no such possession as should put the defendants upon inquiry. The fact that Mrs. Pinney and her husband first went into possession under a contract to pay rent to judge Aikens, can have no effect. There is no evidence that there ever was any written lease, much less that there was one upon record. Upon the execution of the deed to the trustee in 1824, the same was put upon record. This was notice of the determination of the tenancy that might have been inferred to have existed between judge Aikens and those in possession, from the occupancy. So far as the possession is to have the effect of notice, it is immaterial whether the possession was in the husband and wife, or technically in the husband alone. The wife had the equitable estate, and was, in equity seized of it in her own right, and the husband was in, under her. -Neither was it of any account that the trustee was the son of the cestui que trust. This can have no operation upon the rule of law as to the effect of possession, nor excuse subsequent purchasers from enquiry. The chancery doctrine, as to the protection of trusts generally, is, that where a purchaser is bound to make inquiry, and he neglects it, he takes the property, subject to the trust, in the same manner as he would have done if he had had positive notice of the cestui que trust interest. I see no reason why the same principle may not well govern this case, notwithstanding our registry act. The possession of Mrs. Pinney and her husband, had been open, exclusive, and continued, for about thirteen years previous to the attachment, and the defendants are chargeable with the'consequences of notice of the trust estate. The defendants, then, standing as privies in estate with Wm-. H. H. Pinney, affected with notice, must stand or fall with him. The result is, the decree of the chancellor is reversed, and the cause is remanded to the court of chancery, with instructions to enter up a decree, that the defendants, and each of them, be perpetually enjoined from further prosecuting their action of ejectment, set up in the bill; and that they quitclaim, for themselves and heirs, all right and title to the premises, to the said Elizabeth N. Pinney and her heirs, within six calendar months, from this date, and also pay the oratrix, Elizabeth N. Pinney, her costs in this court, and, also, in the court of chancery, by such time as the chancellor shall fix,.