Hayden v. Denslow

Seymour, J. The petitioners claim to be tenants in common with the respondent of certain premises in Hartford, and they ask for an order to sell the property thus held, because, they say, it is so situated that it can not be aparted without serious loss and inconvenience. The case was referred to a committee, and from his report it appears that the property was formerly owned by William J. Denslow. He mortgaged and afterwards quitclaimed it to his father, Elihu Dens-low, who thus became vested with the entire legal title. In 1855 Elihu Denslow deeded the premises by quitclaim to the petitioners and to William J. Denslow. The title of William J. by virtue of the last mentioned deed has now become vested in the respondent. It thus appears that the petitioners and respondent hold the premises as tenants in common, and the committee further finds that partition can not be made without great inconvenience and loss. Upon these facts, if there were no other in the case, the court would direct a sale, as asked for in the petition, in conformity with the statute which authorizes the court to make that order in such cases. But it appears from the committee’s report that the notes secured by the mortgage to Elihu Denslow were, soon after the mortgage was made, given up to be cancelled, and that the quitclaim of the premises to him was without consideration,—that it was understood between him and his son, the grantor, when the deed was given, that he should convey the property to Maria S. Denslow, his son’s wife, either by deed or by will,—that he exercised no control over the property, but it was in the occupancy of the said Maria,—and that he, [341] the said Elihu, received the deed and held the premises in trust for the said Maria. The committee further finds that the deed from Elihu Denslow under which the petitioners claim title, was wholly without consideration. Upon these facts the respondent claims that the equitable title to these premises is in Maria S. Denslow, and that the petitioners are not the real owners, having nothing but a naked legal title, and that upon their application a judicial sale ought not to be ordered. These claims of the respondent must certainly prevail unless some satisfactory reply can be made to them, for, upon the facts thus found and thus stated, it appears that Elihu Denslow held this property in trust for his son’s wife, and that the petitioners have paid nothing for the property, and therefore-take subject to the trust. A sale therefore by the petitioners would be in violation of the equitable rights of Maria S. Denslow and a breach of trust. Such a sale, upon this state of the case, the court certainly could not order or sanction. In reply to the ease of the respondent as thus stated, the petitioners make two distinct answers. First, they say that this supposed trust and this agreement to convey the property to Maria S. Denslow, are proved by parol testimony, which was objected to at the trial and ought not to have been received. It is undoubtedly true that the trust and agreement relate to interests in land and are within the statute of frauds and perjuries, but the contract is fully executed on one part. William J. Denslow conveyed the property to his father, and so far as the point now under consideration is concerned, the case is the ordinary one of a husband conveying real estate to a friend, to be by that friend reconveyed to the grantor’s wife. The agreement to reconvey is indeed a contract relating to land, but after a deed is given and received for that purpose the contract is executed on one part, and is by this part execution taken out from the operation of the statute of frauds. Were it otherwise, a statute made to prevent fraud [342] would become an instrument of frauds greater than those it was intended to guard against. But the petitioners make a second answer to the respondent’s claim, and this answer raises a question of considerable importance. It appears from the committee’s report that the mortgage from William J. to Elihu Denslow was a gross fraud upon the creditors of the grantor, and that the quitclaim deed of 1853 was in like manner fraudulent, and the petitioners say that if Maria S. Denslow should seek for the aid of a court of equity to compel a conveyance to her, she would be met with the objection that the contract or trust under which she claims title is tainted with fraud, and that her equitable title must be traced through this fraudulent contract. This question regarding the rights of Maria S. Denslow is attended with some difficulties, and inasmuch as she is not a party to this bill and as her rights can not be definitely settled in this suit, we prefer to put the case upon grounds which we think free from difficulty, without deciding how far her equitable claim may be affected by the fraudulent nature of the contract under which she derives title. It appears from the committee’s report that the petitioners, in order to avoid the equitable title of Maria S. Denslow, offered proof that the mortgage and quitclaim to Elihu Dens-low were fraudulent; and we have seen that without this proof her title must prevail, for if there were no fraud in the case the trust for her benefit must be carried into execution. By their testimony as to this fraud, the plaintiffs claim that the title of Maria S. Denslow is destroyed, but the same testimony discloses another title, equally formidable, in the creditors of William J. Denslow. The case presented is one of gross fraud attempted to be practiced on these creditors, and upon the facts found they are the parties entitled to have this property. It does not indeed appear that they have yet taken steps by attachment or otherwise to obtain their rights, and it is also- true that the title of a fraudulent grantee is good until avoided. Upon such title a partition may perhaps be demandable, but a sale under the statute is not de [343] maridable as matter of right. The statute gives the court power as a court of equity to order Ihe sale, but does not require such order to be made; and we think the court ought not to decree a sale that may affect injuriously the rights of third persons, whether such rights are vested or contingent; especially the court will not order a sale that may seriously affect the rights of creditors. If a judicial sale is made of these premises, the rights of bona fide creditors will be embarrassed and perhaps lost, while those cláiming title without consideration under fraudulent conveyances will enjoy the proceeds of the sale. The hazards of an unsound title should remain with those who have taken it, and ought not to be transferred to others by the order of a court of equity. The powers conferred on the court by the statute under which this application is made are extraordinary powers. Persons of full age and capacity are by the statute obliged to submit, upon the motion of others, to a judicial sale of their interest in property held in common or coparcenary. Such a power ought to be exercised with a careful regard to the rights of parties objecting to the sale. The respondent says that the title to this property is unsettled, that it is not in such a state as to invite purchasers, that if now ordered to be sold her interest in the property will be subject to a ruinous sacrifice, and that no pressing necessity for immediate sale is shown. These arguments seem to us to have weight, and in connection with the other considerations which have been suggested seem decisive against the application. The superior court is therefore advised to dismiss the bill. In this opinion the other judges concurred. Advice that the bill be dismissed.