Hackett v. Callender

Aldis, J. The evidence shows that the legal estate and record title to the premises in question were vested in Royal Flint and John Hackett, sen., but that John Hackett, jun., the orator, was the real owner. About the time that the orator bought the land and had it conveyed to Flint and his father, which was in January, 1849, he went into possession of it and so remained in possession, exercising acts of ownership, up to the time that the defendants Callender and Wright attached the land as the property of Royal Flint. They attached the land by leaving a copy in the town clerk’s office on the 5th of January, 1852, and on the 15th of — 105 — January they completed their attachments by serving a copy on Flint. Thus at the time of the attachments Eoyal Flint appeared of record as the owner of half of the land, while the orator was in possession and was the equitable owner of the whole. Wright and Callender obtained judgments in their suits against Flint, and on the 21st of March, 1853, levied their executions upon one-half of the land as the property of Flint. As the orator was in possession before and at the time of the attachment, his possession was so far, at least, notice to Wright and Callender of his equitable interest, as to put them on inquiry. They claim to have made all such inquiry of him as to his rights and title in the land as the law requires; and that in reply to such inquiry the orator stated that he had no claim to the premises whatever, but that they belonged to his father and the said Eoyal Flint; and that the defendants Wright and Callender, relying on this assurance of the orator, and without any notice of his equitable interest, made their attachments. They claim that their attachments so made are valid and binding to hold the land as the property of Flint. The orator claims that the inquiry was not properly made of him; that the purpose and object of'the defendants in making the inquiry was concealed ; and that the answers were either so obtained by artifice, or given by the orator in heedlessness, ignorance, or by being misled, that they should not be held to rebut the evidence of notice arising from his possession, or be regarded as a binding denial by him of his equitable interest. Upon these conflicting claims of the orator and the defendants the first question in the case arises. When a person is put upon inquiry it is his duty to pursue the inquiry with reasonable diligence, and an honest desire to ascertain the real truth. He- should do nothing to avoid the truth. He should not omit or conceal anything so that the party inquired of may be thereby misled, or may have his attention directed to some object or interest which might tempt him to conceal the truth or to speak a falsehood. To so mislead the party, or, consciously to allow him to be so misled to the statement of a falsehood, would be an artifice, which should deprive the inquirer of any benefit from the information so obtained. — 106 — When a person is inquired of as to a matter in which his answer may affect his pecuniary interests, he has a right to know whether the person making the inquiry has an interest which entitles him to make it, and what the object of the inquiry is, and that the answer will be relied upon. When he fairly and fully understands that the inquiry is entitled to a truthful reply, and that the reply may be acted upon, then he is bound to answer according to the truth ; and if he answer falsely or inaccurately it is at his peril. But when he is not apprised of the rights and'objects of the party inquiring, when he may think that mere inquisitiveness or idle or impertinent curiosity prompt the question, then his answers ought not to be held to affect his legal rights or pecuniary interests. • Idle or impertinent questions relative to one’s private affairs, often fail to receive either respectful attention or accurate reply; Men who are honest and truthful either do not answer them at all, or else answer so as rather to get rid of the inquirer than to furnish accurate information. Some perhaps, acting upon a more questionable theory in morals, that one is not bound to speak the truth where the other has no right to ask the question or to expect an answer, according to truth, would not hesitate to reply with a falsehood. Between such idle questions and reasonable inquiries springing from the necessities of business and directed to proper objects, there is a wide difference. Hence, when one is put upon inquiry it is his duty to see to it that the person inquired of fairly understands that the inquirer has a right to put the question, and what the object of it is, and that the information sought for will be relied upon, and that he may not be led to suppose that it is an idle, impertinent or casual question, in answering which he is not bound to accuracy and 'truth. Fair dealing, we think, requires that these principles should be observed. In applying them to this case we must rely wholly on the testimony of Mr. Wright. It appears that some time previous to the making of the attachments, Mr. Wright had demands against the orator left with him for collection. Upon two occasions, in 1849 and December, 1850, having debts against Hackett to secure, he inquired of the — 107 — orator as to his interest in or title to this land, and was informed, substantially, that it belonged to Flint and Hackett, senior. About a year after the last of these conversations, and a few days before the attachments, Wright, desiring to. collect debts against Flint, who had failed, again inquired of the orator-if he had any claim or title to the land. On cross examination he says he did not give Hackett to understand that he held any demand against Flint; that he made no disclosure whatever to Hackett, and that it was his object not to make any. From this statement of Wright’s it is plain that Hackett could not have known what was the purpose of the inquiry, or that Wright had any reasonable cause for making it, or would rely or act upon the answer he might obtain. Indeed, he might very naturally recur to his former conversations with Wright, and suppose that he made the inquiry for the purpose of finding out whether he could not attach it on a debt against himself. Mr. Wright might have foreseen, if his attention had been called to the matter, that Hackett would recur to the former conversations with him, and'that he would be likely to give the same answer as before, unless the object of making the inquiry, viz, that he wished to secure a debt against Flint, was communicated to him. And in connection with these circumstances we are to bear in mind that Mr. Wright purposely concealed from him his object in making the inquiry. The concealment of his purpose by Wright, though not intended as an artifice to entrap Hackett ■ into a false admission, had the effect of making him heedless as to his reply. We think the manner in which this inquiry was pursued falls much below the reasonable requirements of the law. Mr. Wright knew the record title was in Flint, and the possession in Hackett, and that he was bound to inquire • as to the meaning of such possession, and- whether Flint was the real owner. If he had told Hackett “I have a debt against Flint which I wish to secure, and I wish to know whether you have any interest in this land of which you are in possession, or whether it really belongs to Flint, as it appears of record,” we think he would then have so conducted the inquiry as to bind Hackett by his answers. But as the case stands, we think the answer of Hackett does not rebut the presumption of notice which — 108 — the law raises from his possession ; that it is the same as if no inquiry whatever had been made by the defendants. Another point has been made and argued, and upon which, as the court all concur, we deem it proper to. express our decision. After the attachment and before the levy of the defendants’ executions, the defendants were notified of the equitable title and interest of the - orator. The debt of the defendants against Flint does not appear to have been contracted by Callender relying upon Flint’s ownership of the land. The question is therefore raised that Callender, as an attaching creditor, does not, by virtue of his attaching the land, (even if he then had no notice of the trust) acquire a lien like that of a subsequent purchaser without notice, but that his lien by attachment was defeated by the actrial notice which he received before the levy. In the opinion of Judge Isham in Bigelow & Wife v. Topliff, 25 Vt. 273, it is said that the lien of attaching creditors has always been considered in this State as creating an equitable title equal to that of purchasers. We are not aware that that question has ever been decided in this State, and the expression in the opinion alluded to does not seem to have been called for by a decision of that case. There is an obvious difference in the equities of a subsequent bona fide purchaser of land without notice of a trust, and of a creditor who attaches to secure an antecedent debt. The purchaser advances his money to buy the land. He gives a new consideration. He parts with a new value upon the credit of the apparent record title. The attaching creditor merely seeks to secure an old debt. He advances nothing upon the strength of the record title. He is not made worse by relying upon it. The omission of the real owner to record his deed has not injured the creditor or been the means of depriving him of any value. It is for these reasons that courts generally have treated them as standing upon equities materially different. The cases cited show that a different doctrine has been held in Connecticut and Maine. The case of Carter v. Champion, 8 Conn. 549, is the leading authority to the contrary. But the court turn the case upon the reason that the creditor might select and attach property of the debtor when the secu — 109 — rity was ample, and afterwards by notice be deprived of Ms security when it had become too late to obtain any other. We think the supposition of such a case ought not to be the guide in establishing the general rule, and that practically such a case would be the exception rather than the rule. If such a case were to arise the creditor would stand upon an equity similar to that of a subsequent purchaser. He could say that by relying on the record title he had been deprived of obtaining security for his debt. So if a creditor, relying on his attachment and the record, had surrendered other securities, he might have a superior equity. But the case at bar shows no such or similar equity. It is merely the case of an attaching creditor attempting to secure an old debt against an insolvent debtor by attachment. No new value, credit or consideration are shown, no securities lost, endangered or surrendered. Analogous decisions sustain this distinction. When goods are obtained by false pretences, the subsequent purchaser, without notice, obtains a good title to them. Not so the attaching creditor. He gets nothing by his attachment. He stands in the shoes of his debtor. This is settled by many decisions and is recognized in Poor v. Woodburn et al., 25 Vt. 284. So in the case of purchasers, the rule is well settled in England and has been generally adopted in this country, that notice of the trust before the actual payment of the money, although it be secured and the conveyance executed, is equivalent to notice before the contract, and precludes the purchaser from paying the money and perfecting the purchase. The principle upon which this doctrine rests is to protect the interest of the eestuis que trust when it does not injure the purchaser. When the purchaser has paid his money and bought the legal title, he has at least an equal equity with the eestuis que trust, and having the legal title also, his title and equity united give him precedence. But the attaching creditor upon an antecedent debt has neither the equity nor the legal title, and notice to him of the trust before he gets the legal title by levy and so discharges his debt, should put an end to his lien as between Mm and the real owner. The decree of the chancellor is reversed, and the case remanded to the court of chancery with instructions that a decree b,e made — 110 — to perpetually enjoin Callender and Wright from further prosecuting the actions of law mentioned in the bill, and that the orator recover his costs against Callender and Wright; and as to Darling and Cushman, administrators of John Hackett, senior, that tire decree of the chancellor be affirmed with costs, except that the time of payment by Hackett, junior, to them of the amount due the estate of John Hackett, senior, be extended to ninety days from the making of the final decree by the chancellor.