Cassell v. Ross

Mr. Chief Justice Walkee delivered the opinion of the Court: The purchase of the outstanding title seems to have formed a part of the consideration of the debt secured by the deed of trust. The bill alleges that it formed the consideration of that entire debt, but the answer sets up the fact, that one hundred, of the two hundred dollars, which appellant had agreed to pay towards the purchase of the outstanding title, had not been paid. That for the hundred dollars first falling due, appellant had given his two notes of fifty-three dollars each to appellee Ross. That one of these notes had been paid, and that appellee Ross had assigned and transferred the other. The bill also alleges that the note for one hundred and twenty-four dollars was for a portion of this two hundred dollars, for the purchase of the outstanding title. But the answer of Ross states that the remaining one hundred dollars of that purchase, with its accruing interest, together with a small note which he held for goods purchased by appellant, constituted the' consideration of the note. The bill calls for the answer to be under oath, and so far as it is responsive to the bill, it must be taken as true, inasmuch as it is not contradicted by evidence. The note for goods embraced in, and forming a part of this note, to that extent, was beyond all question a, consideration. And we have no hesitation in saying that the purchase of the outstanding title, whether perfect or imperfect, if not induced by fraud, was a sufficient consideration for the remainder. It is a maxim of universal application, “that ignorance of law excuses no one.” Appellant, then, cannot be heard to say, that he was ignorant that under the law a subsequently acquired title, by Ross; would, under his former covenants, inure to the benefit of appellant. The answer of appellee Ross clearly and unequivocally denies that there was any fraudulent means used to induce appellant to purchase this outstanding title, or that Ross urged or even requested appellant to purchase, but, on the contrary, that the purchase was made at the urgent solicitation of appellant; that Ross made the purchase, and with the previous understanding and agreement that appellant should refund two hundred dollars of the four hundred dollars of purchase-money. And this allegation, responsive to the bill, is uncontradicted by any evidence in the record. If this be true, and it must be so considered, upon what principle of justice or fairness can it be said, that because that title inured to his benefit, he will not pay the portion he agreed to pay before the purchase was made. Is he now to be permitted to escape payment, and leave Ross the whole burthen, when Ross remonstrated and advised against the purchase? Suppose this title to have been paramount, and that under the covenants contained in Ross’ deed to appellant upon its purchase, it would pass by the force of these covenants to appellant’s benefit, it could not be said to form no consideration for the notes given on its purchase by appellant. The utmost extent of Ross’ liability under those covenants, would be the purchase-money with interest, and, possibly, an attorney’s fee in defending an ejectment suit for possession. Yet the premises may have been, as alleged in the bill, worth, with their improvements, double that sum or more. This, then, would have formed a strong inducement for the purchase of the outstanding title by appellant. Its purchase, if paramount, would have been a protection to him of all of the value of the premises beyond that portion covered by Ross’ covenants. In the case of McKinley v. Watkins, 13 Ill. 144, it was held, that the compromise of a doubtful right is a sufficient consideration for a promise; and that it is immaterial on whose side the right ultimately proves to be, as it must be on one side or the other. Then, if it is conceded that it is doubtful whether this outstanding title was paramount, or whether Ross’ covenants would have covered the value of the land, still, as a compromise between appellant and Ross, it would have been a sufficient consideration for the note. Or, suppose appellant was doubtful of Ross’ ability to respond to his covenants, that would have formed a sufficient consideration for the note. Even if it were conceded that this outstanding title was worthless, yet it seems that appellant did not so regard it, as his fears were excited, and he was solicitous, and even urgent, to procure it, to avoid uncertainty and trouble, if not positive loss. When he entered into the agreement with Ross for its purchase, he was willing to give two hundred dollars to have all of those doubts set at rest, and this constituted a sufficient consideration, as Ross resorted to no unfair or fraudulent means to excite his fears or create those doubts. Nor does the fact that Ross has not executed the quitclaim deed constitute a failure of consideration, inasmuch as he was not bound to do so until the two hundred dollars were paid, which is admitted not to have been paid in full. Nor was Ross in default in not making or tendering such a deed, as appellant was bound to pay, or offer to pay, before he had a right to demand the deed. For these reasons, we are unable to perceive that the note and deed of trust should be canceled. The next question presented by the record is, whether the note secured by the deed of trust is purchase-money of the homestead of appellant. He, with his family, at the time of the purchase, resided, and still resides, upon the premises. We have seen that all but a small portion of this note was given for this outstanding title. If appellant had not been holding under a prior acquired title, this question would hardly have been raised. And yet there is nothing in this record from which it can be inferred that the outstanding title- was not paramount. But was the wife estopped to show that she or her husband held the paramount title when the purchase was made of Boss ? This depends upon the construction to be given to the act creating the exemption. The design of the framers of the homestead law manifestly was, to secure a home to the wife and children of the debtor. It was for their protection, more than his. But the title being usually vested in the husband, he must be treated as acting, at least to some extent, as their trustee for the protection of this right which has been cast by the law upon the wife and children. And by virtue of his relation to their rights, he is necessarily vested with the power to perform all acts necessary to secure the title, and thus effectuate the design of the statute. He is, therefore, authorized, when necessary, to purchase an outstanding title for the purpose of securing the enjoyment of the right. And when he has made such a purchase, it will be presumed to have been necessary; but this presumption may be rebutted by the wife, upon showing that she or her husband owned the paramount title when the outstanding title was acquired. If the wife shall show that the real title was so held at the time the outstanding title was obtained, then the consideration agreed to be paid will not be regarded as purchase-money, so as to subject the land to its payment. On the contrary, if the wife fail to show that the paramount title was -already held, then it must be considered that the money agreed to be paid for the subsequently acquired title is purchase-money within the statute. The husband being the head of the family, the presumption is that he acts for their benefit when he .acquires or perfects a title to the homestead. When already in possession under a defective title, he may, with or without the consent of the wife, acquire an outstanding title on credit, and the husband cannot, but the wife may, deny that it was paramount. And until it that such a title was not acquired, the consideration agreed to be paid will be treated as purchase-money. The wife in this case was a necessary party to the bill. She should have been before the court that her rights might have been acted upon. If before the court and it appeared that this outstanding title was paramount, then the court would decree a sale to enforce the payment of the purchase-money, or if, on the contrary, it was worthless, then to enjoin all proceedings to deprive her of the homestead to the extent of one thousand dollars. We now come to the question of the validity of the sale under the deed of trust. The deed authorized Ross to sell upon default of payment of the money, after giving the prescribed notice, for cash, to the highest bidder. The answers of both defendants admit that it was not sold for cash, but that the purchaser gave his note for the entire amount for which the land was sold. Whatever may be said of the power of Ross to give time on the sum due to him, there can be no pretense that he had the right to give any time for the payment of the surplus. As to that portion of the purchase-money he could not release the purchaser, nor could it be discharged in any other mode, or in anything else, than by the payment of the money at the time of the sale. Appellant had conferred no such power by the deed of trust, and he cannot be required to receive Dilworth’s note instead of money, nor can he be delayed in the receipt of the surplus over the payment of the- debt secured by the trust deed, until Dilworth shall pay his note to Ross. Nor can he be compelled to assume the hazard, however remote, of Ross’ insolvency, or to submit to delay in the receipt of the money. He, when the deed of trust was executed, provided for the immediate payment to him of the surplus, but this sale, if sustained, would defeat that provision. Nor was the offer of Ross to pay the surplus to appellant, on the condition that he would surrender the possession of the land to the purchaser, in any sense a compliance with the terms of the deed of trust. He had no power to impose new terms and conditions, or to alter or vary those contained in the deed. All of his power was derived from the deed, and all acts outside of and beyond its provisions were void. Such a condition was in violation of his duty as a trustee. Under the provisions contained in the deed, the purchaser would be left to his ordinary remedies for the recovery of possession. It may be, that had Ross made an unconditional tender of the surplus to appellant, in apt time, that a court of equity might not have been inclined to set aside the sale because the purchaser was not required to pay the money, if the transaction appeared to be bona fide, and free from other objections. In this case Dilworth cannot protect himself by insisting that he was a purchaser in good faith, without notice. He was bound at his peril to examine the title he was purchasing, and if he did so, he found that Ross was dealing with a trust fund. The notice of the sale should have disclosed that fact, and if so, it gave him that notice. Upon discovering that it was a trust fund, he was bound to see that at least all of the conditions of the trust deed, up to the execution of the deed to himself, were complied with and performed by the trustees; and when he became a purchaser upon time, he became a party to the violation of the condition upon which the sale could alone be made. Being chargeable with notice, he cannot evade the effect of the irregularities attending the sale. With a remote purchaser it is believed to be different, but the immediate grantee, under the trustee’s sale, must be held to see that all precedent conditions of the sale are complied with by the trustee. For these various reasons the sale should have been set aside. The decree of the court below is reversed, and the cause remanded, with leave to the complainant to amend his bill, and the defendants to file answers to such amendment, and to both parties to take evidence in the cause; and if the court shall find that the note, was given for the purchase-money of the paramount title, in accordance with the views herein expressed, that a decree be entered for a sale of the land; if, however, it shall appear not to have been purchase-money, that a decree be entered for the payment of such sum as may be found due, and order its payment on a day to be named in the decree, and on default of such payment, that the master proceed, in the manner prescribed by the statute, to ascertain whether the land is worth more than one thousand dollars, and, if so, to subject the over-plus to sale, as required by the homestead law. Decree reversed.