Kinzie v. Penrose

Smith, Justice, delivered the opinion of the Court: (after stating the facts in the case.) (1) We think the demurrer ought not to have been sustained. The consideration upon which the lot No. 11 was conveyed, sufficiently appears by the exhibit of the letter of Penrose, the appellee, to have been the one stated in the bill. The letter is explicit, that the lot was presented or transferred by conveyance, on the express condition of building. There can be no question that it is competent for the appellant to show a different consideration than the one stated in the deed, as between the parties to it. The true consideration is admitted, and therefore it would be but equitable that the appellee should perform his part of the real original contract between the parties. If it be objected that this was a parol contract concerning the sale of lands, and consequently within the statute of frauds, it maybe replied, if it be so considered, that the statute has not been pleaded, and consequently, as the contract is not sought to be avoided under the statute, the Court will not notice it. We think there is sufficient equity in the bill. The judgment of the Circuit Court is reversed, and the cause remanded for further proceedings. A rehearing having been had in this case, we proceed to reaffirm the opinion heretofore expressed in the cause, and to state more fully the reasons for still entertaining the conclusions to which we came on the first hearing; and also to answer the objections urged by counsel against a reversal of the judgment of the Circuit Court. It has been strenuously insisted on, that the complainant cannot contradict bis deed, nor enter into proof of any other consideration than that expressed in the deed, for that would be contrary to the deed. As a general rule, the proposition is admitted; but there are exceptions to all general rules. To this general rule of evidence, which prevails in equity as well as at law, there is admitted to be several exceptions, and that these exceptions prevail in cases of fraud, mistake, imposition, or oppression ; and in cases where deeds have been entered into upon secret trusts between the parties. A very strong case of an exception to the general rule, is to be found in Washington’s Virginia Reports of cases decided in the Court of Appeals in that State, (2) in which parol evidence was admitted to prove that an absolute deed was intended to operate as a mortgage. The Court, in that case, say that, “ It is objected in this case that here is an absolute deed, and that no parol proof is to be admitted to contradict it. This is a question important in its consequences, but which, in its full latitude, cannot be admitted either way, as the general rule; that is to say, we cannot determine that it is not to be admitted in any case, or that it is to be admitted in all cases. To say it shall be admitted in no case, would be to overturn all the decisions in which relief has been granted against deeds, upon the grounds of fraud, mistake, oppression, or imposition; or that they were made upon secret trust between the parties. In all which cases the fact, which is the ground of relief, is established by the testimony of witnesses. Of the first class, the books abound with instances, which are stated in the case of Lord Irnham v. Child.(1) Of the latter, there are also many. The case of Gascoigne v. Tewing (2) is a strong one. A. purchased in the name of B., to whom the conveyance was made; A. was admitted to prove that he paid the purchase money, so as to make it a resulting trust to himself. So in the case of Hill et ux. v. Wiggett, (3) a surrender of a feme covert, and the admission upon the roll was of a moiety only of her estate, yet an entry on the steward’s book, and parol proof by the foreman of the jury, were admitted as good evidence to prove she surrendered the whole.” Another case is referred to, supposed to militate against the distinction contended for, but it is remarked, “ The general principles of the case prove that parol evidence, where there is a deed, is not to be admitted in all cases, nor refused in all; every case must depend upon its own circumstances. In that just noticed, the Chancellor admitted the proofs to be read, to discover if there were grounds for relief, on a new head of equity, and on the testimony, determined there was not.” Parol proof that a deed, absolute in its terms, is in fact a mortgage, is admissible. (4). The cases cited by the counsel for the defendant in error, from 1 Johnson’s Chancery Reports, do not militate against the principles of exception to the rule contended for, nor, it is thought, deny the justice of the rule. In that most relied on, of Stevens v. Cooper,(5) the Chancellor remarks, “ The general rule is certainly not to be questioned or disturbed. It ought not to be a subject of discussion. It is as well grounded in reason and policy, as it is in authority; nor does this case come within any exception admitted here to the operation of the rule.” If no relief should be afforded the complainant, it is most evident that the defendant will receive valuable property, without the performance of a condition admitted to have been one of the conditions of the conveyance of the land, and in violation of an express stipulation between the parties. The complainant anticipated an increase to the value of the residue of his property adjacent to the lot conveyed, by the agreement to build; and supposed it would have been observed by the defendant, in good faith. The Court see no just reason why the latter should be absolved from his engagement, and also retain the lot, without giving any compensation therefor. The admission of the parol evidence shows only that there was an additional consideration for the conveyance, which existed at the time, and must naturally be supposed to enter into the inducements for the sale of the ground. Hence we are not satisfied that the parol proof should be excluded, but believe it ought to be admitted, on the ground of preventing the perpetration of an imposition, an act of oppression on the complainant. The objection, then, that the condition is not by deed under seal, but resting in parol, is met by the reasons stated for the admissibility of such proof. The other ground assumed by counsel, that a court of equity will never lend its aid to divest an estate, for the breach of a condition subsequent, is thought to have no application to the case before us. There is not conceived to be any condition subsequent. It was a coexisting condition at the time of the execution of the deed, resting in parol, but not inserted in the deed, because, probably, of the mutual confidence between the parties at the time, that it would be consummated in good faith. Let the judgment of the Circuit Court be reversed, with costs, and the cause be remanded for further proceedings. Judgment reversed. Footnotes [(1)] The Reporter has omitted the statement of the case made in the opinion of the Court, because the facts have already been given. [(2)] 1 Wash. R. 19. [(1)] 1 Bro. Ch. C. 92. [(2)] 1 Vern. 366. [(3)] 2 Vern. 547. [(4)] 9 Wend. 227. [(5)] 1 Johns. Ch. 429.