Kincheloe v. Taylor

Whittle, P., delivered the opinion of the court. Appellants, Arthur N. Meloy and James M. Kincheloe, complain of eértain decrees of the circuit court denying to the former the benefit of an alleged completed purchase of the Aspen Hill farm, in Fairfax county, and to the latter, a real estate broker, a flat commission of $500 for effecting' the sale. Stated generally, the controlling facts are these: In June, 1916, Strayer filed his bill against Taylor, in which he as — 180 — serted claim to an equitable interest in the farm. His contention being that at his suggestion and through his efforts Taylor purchased the property; that there was a prior parol agreement between them that the title should be taken in Taylor’s name, but that the farm was to be sold, and Strayer in consideration of his services was to.receive one-half of the proceeds of sale in excess of $8,500; that on May 8, 1916, Taylor tendered to Strayer a writing as follows: “In compliance with our agreement relative to Aspen Hill farm now owned by me, I agreeing to allow you one-half of the proceeds of sale over $8,500, interest and taxes, and you in consideration of the same to move on and live on the farm and show same at all times, price and terms of sale of farm to be ratified by me. In case farm is not sold by October 1, 1916, said Strayer can at his option move off of farm, but must continue to look' after same.” The bill further alleged that Strayer moved on the farm in pursuance of his “verbal understanding;” that about one month afterwards and while he was endeavoring to sell the property, a controversy arose between him and Taylor as to the possession of a certain part of the dwelling, as a result of which Taylor announced his purpose to sell the farm for $8,500 and $100 additional to" cover the expenses of grading a road thereon, thereby seeking to deprive Strayer of the opportunity to sell the property and to destroy his interest therein. The bill prayed that Taylor be enjoined from'selling the farm, or disturbing Strayer in his occupancy and possession thereof pending the suit, and for a sale of the property finder the supervision of the court and an equitable division of the proceeds, and for other further and complete relief. A lis pendens was filed with the bill and duly docketed and recorded, which describe the farm by name and metes and bounds, and plainly set out the scope and objects of the suit. On September 1, 1916, Taylor filed his answer denying the allegation of the bill in. respect to the parol contract, and — 181 — averred that Strayer was the agent of his vendor, Crawford, in negotiating the sale of the farm, and that no responsibility rested upon respondent to remunerate him for any services that he may have rendered in that behalf; that the written agreement between them, and not any parol understanding, measured the rights and liabilities of the parties; that respondent was willing to live up to that agreement; that he had not obstructed Strayer in selling the property, and that he was still willing for him to make such sale, and to allow him one-half of the proceeds in excess of $8,500, in accordance with their written agreement. On September 27, 1916, Taylor listed the farm with Kincheloe for sale. A few days later Kincheloe opened negotiations with Meloy, a prospective purchaser, for the sale of the farm, pending which, in addition to the constructive notice imparted by the lis pendens, both of them had ■actual notice from Taylor and his attorney of the pendency of the Strayer suit. On October 12, 1916, these negotiations culminated in a memorandum agreement to the effect that in consideration of $10 and other considerations therein mentioned, Taylor agreed to sell and convey to Meloy the farm for $10,500, $250 cash, $3,250 within sixty days, “or on date thereafter when deed is delivered (and certain stipulations with respect to residue of purchase money, etc.)” Then follow these provisions: “Whereas it is understood by both parties hereto that there is pending á certain suit in Fairfax county * * * covering the question of possession. Now, therefore, it is understood and agreed that said party of the first part is to deliver immediate possession of the above mentioned tract of land as soon as the aforesaid suit is either settled or dismissed, at which time the sale is to be closed.” The concluding clause provided that in the event the first party did not deliver the possession of the farm he should reimburse the second party any and all sums paid on account of the purchase price, together with — 182 — the further stipulated sum of $150 for any additional expense incurred in seeding the land. Interest, taxes and insurance were to be “adjusted to the date of transfer and closing.” On the same occasion, Taylor, at the request of Meloy, who expressed a wish to put a crop on the land, delivered to him a written statement addressed, “To whom it may concern,” that he had sold the farm to Meloy and that he was entitled to the possession of the same. On October 17, 1916, Strayer, who was ignorant of the negotiations between Taylor and Meloy, secured from Creel a written agreement to purchase the farm at $12,000. Subsequently, Meloy and Kincheloe induced Creel to withdraw his offer of purchase upon a secret agreement that Meloy would consummate his purchase from Taylor and then sell .to Creel for $12,000. On November 14, 1916, shortly after this arrangement between Meloy and Creel, these parties and Kincheloe each filed his petition in the case. Meloy’s petition set out his contract with Taylor to purchase the farm at $10,750, and prayed that such orders might be entered as would give him a good title to the property; Kincheloe’s petition asked that he be paid his commissions of $500 on the sale to Meloy; and Creel’s petition withdrew his offer of '$12,000 for the farm, and asked that Strayer be decreed to refund the $250 paid thereon. On December 8, 1916, Strayer served written notice on all the parties that he would move the court to confirm the sale of Creel. At the hearing of this motion, upon Creel’s statement that he still desired to purchase the farm at $12,000, the judge dismissed all three of the petitions and confirmed the sale to Creel on the terms of his first offer. Finally, Meloy filed an additional petition praying for a personal decree against Taylor for $625, the difference betwen the sale to petitioner and the sale to.Creel, which it was alleged Taylor would receive. Kincheloe also filed an additional petition in which he fer newed his demand for his commissions. Both of these peti — 183 — tions were subsequently dismissed, but the former without prejudice to Meloy’s right, if so advised, to litigate with Taylor the demand asserted therein. The circuit court correctly construed the written contract of sale between Taylor and Meloy to be a conditional contract, only to become effective in the event Strayer was divested of possession and interest in the farm, stipulating on its face the damages to be paid Meloy should Strayer not be so divested. The court also rightly held that the confirmation of the sale to Creel rendered “null and void and of no effect” the contract between Taylor and Meloy, except to entitle Meloy to. receive the $250 paid by him to Taylor, which sum had been tendered him by the latter. We are of opinion that the circuit court properly determined the rights of Taylor and Strayer with respect to the Aspen Hill farm under the agreement of May 8, 1916; and, therefore, its rulings upon subordinate questions followed in natural and necessary sequence. Strayer was within his rights in invoking the aid of a court of equity to protect his interests under his contract; and the confirmation of the sale to Creel was within the pleadings and warranted by the evidence. In addition to the conditional character of the contract of sale between Taylor and Meloy, both Meloy and Kincheloe, at the threshold of the negotiations, were affected with both actual and constructive notice of the litigation between Strayer and Taylor, and of the rights and equities of Strayer in the farm. An examination of the record would have advised them that a court of equity had acquired jurisdiction of the parties and the subject matter, and that they would deal with the property at their peril. At best, Meloy was only a pendente lite purchaser, with actual and constructive notice of the pending suit, and took the property subject to any decree that might be rendered therein with respect to it, and Kincheloe occupied no higher ground. Hurn v. Keller, 79 Va. 415; Nixdorf v. Blount, 111 — 184 — Va. 127, 68 S. E. 258. Nor did appellants better their condition by attempting to stifle Creel’s bid. Such aggreements are opposed to public policy and illegal. Bolling v. Mullins, 111 Va. 250, 68 S. E. 982. The decrees complained of are without error and must be affirmed. Affirmed.