Case v. Bumstead

Elliott, C. J. Complaint by Case, the appellant, against the appellees, to enforce a vendor’s lien on real estate. The facts of the case, as alleged in the complaint, are substantially these: James Evans, being seized in fee of certain real estate, situate in Pike county, on the 3d of November, 1855, bargained and sold the same to N. JR. $ E. S. Alford, by an agreement in writing, signed by the parties, as follows: “Article of agreement made and entered into the 3d day of November, 1855, between James Evans, of Pike county, Indiana, of the one part, and Nathan B. Alford and Elijah S. Alford, of the same place, of the other part, witnesseth: that the said James Evans has this day sold to the said Elijah 8. Alford and Nathaniel Alford, the equal, undivided half of the following described tract of land, lying and being in said county of Pike," (describing it,) “containing one hundred and fourteen and one-half acres. The said Alfords agree to pay to said Evans, as consideration money therefor, one thousand dollars on or before the 1st day of April, 1856, and, upon making such payment, to execute to said Evans their two notes of hand, one payable on the 25th day of December, 1856, for one thousand dollars, and one for five hundred dollars, payable December 25th, 1857; said notes to bear interest from date. Now the said Evans, on his part, agrees, upon receipt of the first payment as aforesaid, and upon the execution of the notes aforesaid, to make and execute to the said Alfords a good and sufficient deed in fee simple for said tract of land, and also to give to them possession of the premises, including houses, free from rent or charge. — 431 — “In witness whereof, the parties have hereunto set their hands and seals the day and year first above written. his [Signed,] Jambs M Evans. [seal.] mark. N. R. & E. S. Aleord. [seal.]” “Attest: John McIntire.” On the 24th of March, 1856, the Alfords paid, to Evans, on the contract, $1,000, and executed to him their two promissory notes, one for the sum of $1,000, payable on the 25th of December, 1856, and the other for the sum of $500, payable on the 25th of December 1857. They describe the land, and show that they were given in part consideration therefor. Evans, on the same day, executed and delivered to the Alfords a deed of conveyance in fee for the land, as required by the terms of the written contract. On the 9th of April, 1856, Evans procured the execution of the written agreement to be proved before the recorder of Pike county, by Mclntire, the subscribing witness, a certificate of which proof was duly indorsed on the agreement by the recorder, and the agreement and certificate were then recorded in the recorder’s office of said county. On the 25th of April, 1856, Evans sold, and transferred by indorsement in writing, both the promissory notes executed to him by the Alfords, to Case, the plaintiff. N. R. & E. S. Alford, afterward laid off and platted the lands into town lots, named the town Alford, and had said plat duly acknowledged, and recorded in the recorder’s office of the county of Pike. The defendant, Rhoda Bumstead, afterward became the purchaser, and is now the owner, of a large number of said lots, particularly described in the complaint. The complaint also avers that the notes remain due and unpaid, and that N. R. § E. S. Alford long since failed in business and removed from this state, and that they, nor — 432 — either of them, have now, nor within the last five years have had, any property in this state subject to execution. The complaint prays that the amount due on said notes may be declared a lien on said lots, now owned by said Rhoda Bumstead, and, unless the same be paid, that a sale of said lots be decreed for the payment thereof, &c. Publication was made as to the defendants, Nathan R. and Elijah S. Alford, and they were defaulted. Rhoda Bumstead appeared and demurred to the complaint. The court sustained the demurrer, and, thereupon, rendered final judgment for the defendants. The only question urged for the reversal of the judgment of the Circuit Court arises upon the ruling of that court in sustaining the demurrer to the complaint. It is not averred in the complaint that Rhoda Bumstead, at the time she purchased the lots and received a title to them, had actual notice of the existence of the notes to Evans, and that they were given for a part of the purchase money of the land by N. R. § E. S. Alford, but it is averred that she had constructive notice thereof, by the recording of the article of agreement between the parties, in reference to the purchase. Section 35 of the “Act concerning real estate and the alienation thereof,” 1 G. & H. 266, provides that “every executory contract for the sale or purchase of lands, when proved or acknowledged in the manner prescribed in this act for the proof or acknowledgment of conveyances, may be recorded in the county in which the lands to which such contract shall relate may be situate; and when so proved or acknowledged, and the record thereof when recorded, and the transcript of such record when duly certified, may be read in evidence in the same manner, and with the like effect, as in the case of a conveyance.” This provision of the statute authorized the contract between Evans and the Alfords to be recorded, and the recording of an instrument, authorized by law to be recorded, operates, in judgment of law, as constructive — 433 — notice to all subsequent purchasers or mortgagees of the contents of such instrument. Lasselle v. Barnett, 1 Blackf. 151; Reed v. Coale, 4 Ind. 283. This contract having been duly proved and recorded before Rhoda Bumstead purchased the lots, she must, therefore, be presumed to have purchased with notice of its contents. Assuming, then, that she had notice of the existence and contents of the contract, the question is presented, are the facts stated in the contract sufficient to charge her with notice, after the execution of the deed by Evans to the Alfords, that a part of the purchase money still remained unpaid ? It was evidently the object of Evans, in procuring the contract to be proved and recorded, to assert his equitable lien on the land for the unpaid purchase money, and to give notice thereof to all who might become interested. Its covenants, in other respects, had been fully performed before it was recorded, by both parties; and, except as a means of giving such notice, its recording would have been a useless expense. The facts shown by the contract are, that the whole consideration for the land was $2,500; that of this sum the Alfords were to pay $1,000 on the 1st of April, 1856, at which time Evans was to execute to them a deed for the land, and, at the same time, they were to execute to Evans their promissory notes, one for $1,000, payable on the 25th of Eecember, 1856, and the other for $500, payable Eecember 25th, 1857. By the record, then, Mrs. Bumstead was notified that the Alfords were to receive a conveyance for the land long before they were to pay $1,500 of the purchase money, and that, at the same time of the execution of the deed to them, they were to execute to Evans their two promissory notes for that $1,500. While the record of the deed afforded prima facie evidence that the purchase money was fully paid at its execution, the record of the original contract gave notice that, by its terms, the deed was to be made and delivered, leaving $1,500 of the purchase money to be paid at a distant future time. The reasonable inference to — 434 — be drawn from these facts would seem to be that the deed was executed under and according to the original contract, and that a part of the purchase money, therefore, was not paid at or before the execution of the deed. And these facts, it seems to us, should be deemed sufficient to have put Mrs. JBumstead on her guard, and to require that she should have made the proper inquiry, by which she could have readily ascertained that the notes for the $1,500 were still unpaid and outstanding, and constituted an equitable hen on the land for their payment. No brief has been filed in the case by the appellee’s counsel, and hence we are not directly advised of the grounds assumed in support of the demurrer in the court below; but we are informed by the appellant’s bi'ief that it was insisted, in the Circuit Court, that the lien that might otherwise have attached, was discharged by a stipulation in the original executory contract between the parties. It was therein stipulated that on the receipt of $1,000 of the purchase money, and upon the execution by the Alfords of the notes for the remaining $1,500, Evans should “make and execute to the said Alfords a good and sufficient déed in fee simple for said tract of land, and also give to them possession of the premises, including houses, free from rent or charge.” And it was urged in the Circuit Court, as we are informed by the appellant’s brief, that as the vendor’s lien for the unpaid purchase money is a charge upon the land, the stipulation in the agreement in this case, that the Alfords were to have the possession of the lands and houses, “free from rent or charge,” was a waiver of any lien for the purchase money, and discharged the land therefrom. We do not think that such a conclusion can be legitimately drawn from that provision or expression in the contract, when fairly construed in connection with its other provisions. The deed was to be made by Evans, and possession given, when only two-fifths of the purchase money were paid. Yet it was provided that the Alfords — 435 — were to have the possession of the land and houses, “free from rent or chargethat is, free from rent or charge for, or on account of, such possession or use of the property. The term “ charge ” is used in immediate connection with “rent,” and if not intended to mean the same thing, at least refers to the same subject matter, viz: the possession, use and occupancy of the land, and the houses thereon, and does not, as we think, have any reference to the equitable lien or charge upon the land, given by the law, for the unpaid purchase money. W. E. Niblack and W. II. De Wolf \ for appellant. <7. G. Jones, for appellees. No other security was given or provided for, and we see nothing in the contract indicating any intention on the part of Evans to waive the lien. We think the Circuit Court erred in sustaining the demurrer to the complaint. The judgment is reversed, with costs.