Mack v. McIntosh

Mr. Justice Magruder delivered the opinion of the court: First—We do not deem it necessary to enter into any detailed discussion of the terms of the contract, made between McIntosh and Packer. They appear to have been associated together in the ownership of the premises in question, and in the erection thereon of an apartment building or building of flats, known as the “Alexandra” flats. After the contract for the sale of the premises by McIntosh to Packer was entered into, and, on May '23, 1890, Dowdle & McWhirter, a firm composed of John Dowdle and James McWhirter, filed a mechanic’s lien notice in the office of the clerk of the circuit court of Cook county for $4601.07, claimed to be due to them, as stone contractors. Dowdle & McWhirter had furnished the stone, used in the erection of the building upon the premises. The mechanic’s lien, notice of which was thus filed on May 23, 1890, was not minuted upon the abstract of title, which had been furnished to Packer’s attorney, but had come to his knowledge before his examination of the .abstract was finished, and, in his opinion in regard to the title, he referred to this lien as an existing encumbrance upon the property, and made it the basis of an objection to the title. The proof tends to show, that the building upon the premises was completed in April or May, 1889, and that, on September 17,1889, a settlement had been had_between McIntosh on the one side, and Dowdle & McWhirter on the other, by the terms of which Dowdle & McWhirter waived their right to a lien upon the building, and accepted a note in payment of the balance due them. On May 26, 1890, when the deed was tendered by McIntosh to Packer, a written waiver of lien, signed by Dowdle & McWhirter on September 17, 1889, and other papers, tending" to show that nothing was due to Dowdle & Mc-Whirter, were exhibited and tendered by McIntosh to Packer. We stop not to consider, whether or not, by the terms of the "contract of sale between McIntosh and Packer, McIntosh was bound to furnish an abstract, showing upon its face a release of this alleged mechanic’s lien. Such consideration is unnecessary in view of what is stated hereafter. We are satisfied from the evidence, that this notice of a mechanic’s lien was filed by Dowdle & McWhirter at the instigation of Packer himself.. The name of the building of flats, “Alexandra,” had not been carved, as was originally intended, over the entrance thereto. On May 8, 1890, the very day on which the contract of sale was signed, Packer induced McIntosh to sign S. written order to Dowdle & McWhirter, directing them to carve the letters, “Alexandra,” over the entrance to the building. This written order stated, that Dowdle & McWhirter had agreed to put on these létters, but had failed to do so, and that they had been settled with and paid therefor already. The theory, upon which the mechanic’s lien notice was filed, appears to have, been that, by the cutting of these letters, which took place between May 8 and May 23, 1890, the performance of the contract for the stone work would be extended up to the latter date. Packer was present with Dowdle & McWhirter during a part of the time when they were carving these letters in the stone. Admissions made by Packer, and other circumstances developed by the testimony, prove that the whole transaction in regard to the filing of the mechanic’s lien was brought about by Packer for the purpose of putting a cloud upon the title, so as to embarrass McIntosh in carrying out the sale of the property. In view of the manner, in which the lien was thus'put upon the property, Packer was not, of course, warranted in urging the presence of such lien upon the records as an objection to the title. For the same reason, he can not come into a court of equity to ask for a specific performance of the contract of sale. The contract, made on May 6 or May 8, 1890, was assigned to the plaintiff in error on April 30, 1891. If Packer, the purchaser, is not entitled to a specific performance of the contract, the plaintiff in error, his assignee, is in no better position. (Rose v. Swann, 56 Ill. 37). The present bill for specific performance was not filed by the plaintiff in error until May 27, 1892, more than a year after the contract was assigned to her. Where an objection to,a title is urged in bad faith, neither the purchaser, nor his assignee, can be excused for the delay occasioned in the performance of the contract. (Hoyt v. Tuxbury, 70 Ill. 331). The conclusion is irresistible that, at the time Packer urged his objection to the title, based upon the existence of this lien, he knew of its real character. A bill for the specific performance of a contract is addressed to the sound legal discretion of the court, and relief will not be granted as a matter of course. (Maltby v. Thews, 171 Ill. 264). To entitle a party to relief in a court of equity, he must come with clean hands, and with a cause that appeals to equity for relief. (Tamm v. Lavalle, 92 Ill. 263). We are of the opinion, for the reasons above stated, that plaintiff in error was not entitled to a specific performance of the contract. To allow her to have it would be to allow her to take advantage of her own wrong-, or of that of her assignor. Second—It is urged, however, by the plaintiff in error that, even if the specific performance of the contract be not granted, yet that she should have a decree for the amount of the earnest money, to-wit, the sum of $3000.00, and interest thereon, as compensation, and that the decree for such amount should be made a lien upon the premises. This contention cannot be sustained under the facts of this case, but plaintiff in error must be left to her remedy at law, if she has any. We express no opinion upon the question, whether or not McIntosh had a right to rescind and forfeit the contract, and retain the earnest money. We simply hold that, in this proceeding, the plaintiff in error is not entitled to a decree for the amount of the earnest money, which shall be a lien upon the property, for the reasons hereinafter stated. On July 23, 1890, after Packer had refused to carry out the contract, and after McIntosh had tendered a deed of the premises and served notice of forfeiture, McIntosh sold the premises to the defendant in error, Francis O. Matthiessen, for the sum of $70,000.00, and executed to him a deed therefor, which was recorded on the day of its date. Counsel for plaintiff in error make no claim in their brief, that Matthiessen" did not purchase the property in good faith and for a valuable consideration. They claim, however, that Matthiessen had notice, or, under the law, was chargeable with notice of the contract made between McIntosh and Packer, and that, therefore, he holds the property subject to the same equities in favor of Packer or his assignee, as would exist in case the title still remained in McIntosh. This certainly would not be so, if Matthiessen had no notice, or is not chargeable with notice, of the contract between McIntosh and Packer. The allegations of the bill, and the testimony in the case, show that the plaintiff in error knew, before she filed the present bill, that McIntosh, the vendor in the contract, had parted with the title to the land. The rule is, that, where the vendor’s incapacity to perform' the contract, though caused by his own act, as by his conveyance to a bona Jlcle purchaser, is known to the complainant or vendee at the time of bringing suit, the bill will not be retained for the assessment of damages, but will be dismissed, leaving the complainant to his or her legal remedy for the recovery of said damages. (Saur v. Ferris, 145 Ill. 115; Doan v. Mauzey, 33 id. 227; Stickney v. Goudy, 132 id. 213; Hurlbut v. Kantzler, 112 id. 482; Sellers v. Greer, 172 id. 549). Of course, the rule that a bill for specific performance will not be retained to assess damages for a failure to perform the contract where the complainant knew, when he filed the bill, that the vendor had parted with the title to the property, is subject to the condition, that the vendor has parted with the title to a bona fide purchaser, that is, to a purchaser without notice of the equities of the party filing the bill. It is claimed by the plaintiff in error, that Matthiessen had notice, because, before his purchase, Packer had put on record an unsigned copy of the contract between himself and McIntosh. The recording of such unsigned copy could not operate as notice to Matthiessen, for the reason that it was not such an instrument as was entitled to be recorded. The record of an instrument, not entitled by law to be recorded, is of no avail as notice. (St. John v. Conger, 40 Ill. 535). The mere copy of a contract is not entitled to be recorded, as it has no legal authority, and is not an instrument of which the law can take any notice. The original alone is entitled to be recorded. (Lane v. Lesser, 135 Ill. 567; Mullanphy Savings Bank v. Schott, id. 655). Surely, if the copy of an executed contract does not operate as notice when recorded, the copy of an unsigned contract cannot operate as such notice. It is claimed, however, that Packer had such possession of the premises, as operated .as notice to Matthiessen. The proof does not sustain this contention. Packer owned some hardware, which was stored in the cellar under the sidewalk in front of the building, but there was nothing to indicate to Matthiessen that this hardware belonged to Packer, nor did it constitute such possession as would operate as notice. Tenants, who occupied the building, were tenants of McIntosh, and the janitor, who had control of the building, was an employe of McIntosh. After an examination of the evidence, we are satisfied that all the indicia of possession pointed to McIntosh, and not to Packer, as the owner of the property. It is said, however, that Eugene E. Prussing was the agent of Matthiessen in the purchase of the property, and that, inasmuch as Prussing had been the attorney of McIntosh, and had notice of the contract between McIntosh and Packer, and of the rights of Packer thereunder, Matthiessen was chargeable with notice through the notice thus possessed by his ag'ent or attorney. It must be remembered that Prussing was an attorney at law, and whatever notice he acquired while acting for McIntosh, he acquired as the latter’s attorney. The rule, that, if the agent, at the time of the purchase has knowledge of any prior lien or contract or equity affecting the property, his principal is chargeable with such knowledge, is subject to the qualifications, that the knowledge of the agent is present to his mind at the time of making the purchase for his principal, and that the agent is at liberty to communicate his knowledge to his principal, and that it is his duty to do so. (Williams v. Tatnall, 29 Ill. 553; Snyder v. Partridge, 138 id. 173; The Distilled Spirits, 11 Wall. 356; Burton v. Perry, 146 Ill. 71). When the knowledge of the agent has been acquired confidentially as attorney for a former client in a prior transaction, the reason of the rule, that the principal is bound by the knowledge of his agent, ceases. In such case, the ag'ent cannot be expected to do that which would involve a breach of professional confidence, and bis principal ought not to be bound by his agent’s secret and confidential information. (The Distilled Spirits, supra). In the present case, Matthiessen would not be affected by the notice of his agent, which the latter acquired confidentially as the attorney for McIntosh. We are, therefore,- of the opinion that Matthiessen cannot be chargeable with such notice, as Prussing had, under the circumstances shown by this record. It must be held, therefore, that Matthiessen was a bona fide purchaser of the property without legal notice of any rights on the part of Packer, or his assignee. This being so, the present bill cannot be retained for the purpose of entering a decree for compensation, which shall be a lien on the property. We find no substantial error in the record, and accordingly the decree of the superior court is affirmed. Decree affirmed.