Acton v. Waddington

The Chancellor. It is well established in this court that where land is conveyed and the purchase-money for it is not paid, and no distinct security for the payment of that money is taken in its stead, a constructive trust arises, and the vendee is considered as the trustee of the land for the vendor until the purchase-money is paid. The vendor thus obtains an equitable lien upon the land for the purchase-money, which is good against the vendee and his heirs and all persons taking from them as volunteers, and also against purchasers from them for value with notice that the purchase-money is unpaid, and is unenforceable only against purchasers for value in good faith without such notice. Crawford v. Bertholf, Sax. 458; Vandoren v. Todd, 2 Gr. Ch. 397; Brinkerhoff v. Vansciven, 3 Gr. Ch. 251; Herbert v. Scofield, 1 Stock. 492; Dudley v. Dickson, 1 McCart. 252; Arm [21] strong v. Ross, 5 C. E. Gr. 109; Corlies v. Howland, 11 C. E. Gr. 311; Ledos v. Kupfrian, 1 Stew. Eq. 161; Ogden v. Thornton, 3 Stew. Eq. 569; Graves v. Coutant, 4 Stew. Eq. 763, 779; Porter v. Woodruff, 9 Stew. Eq. 174; Butterfield v. Okie, 9 Stew. Eq. 482. As has been indicated, that of which a bona fide purchaser for value must have notice to bind him to the lien, is the indebtedness of his vendor for the purchase-money, or a portion of it. Brinkerhoff v. Vansciven, Amstrong v. Ross, Graves v. Coutant, supra. The taking of some penal undertaking from the vendee to pay the purchase-money, such as his bond, note or covenant, unless it appears that it waa intended to be substituted for the purchase-money or to be the thing in fact bargained for, will not destroy the lien. Such instruments will be considered as intended only to countervail the receipt for the purchase-money which may be contained in the deed, or to define the time and manner in which the payment is to be made, unless there be an ■express agreement between the parties to waive the equitable lien; but the lien will be considered as waived whenever any distinct and independent security is taken, such as a mortgage on the land, or pledge of things, or personal responsibility of third persons and the like. 1 Lead. Cas. Eq. 483. “ The pith of the rule,” said Vice-Chancellor Van Fleet, in Corlies v. Howland, above cited, “ is, there must be proof in the nature of the security accepted, evincing an intention by the vendor to waive the lien.” As to the duration of the lien, Justice Scudder, in writing the opinion of the court of errors and appeals, in Graves v. Coutant, above cited, said (p. 780): “ If this lien exists by the ■operation of a constructive trust, then I think it must be concurrent with it, and attach at the time the vendor obtains his right in the property, and it will continue so long as the trust remains, or, •as some of the eases say, so long as an action can be maintained for its collection.” If it be assumed, for the purpose of the application of these principles, that the bond in question represents the bond to Rebecca Ware for the purchase-money, the lien claimed will clearly obtain. Purchase-money indisputably remained unpaid, and [22] the Rebecca Ware bond was clearly taken merely to fix the fact that money was due (thus countervailing the receipt contained in the deed), and to define a time of payment. When the defendant Richard Waddington purchased the farm, he had ample notice of all that was necessary to the preservation of the equity of Black’s vendor in the land. The bond became payable in 1872, and within fifteen years thereafter this suit was brought upon it. I understand that if the case thus stood there would be no dispute as to the validity of the claim. Similarly situated-bonds were paid by Waddington without question. The disputed point is, whether the bond now sought to be enforced represents the purchase-money for which the lien is claimed. All the parties to the bond are dead. Rebecca Ware is dead, and the scrivener who drew the bond is also dead. The Blacks are dead. It is now impossible, by direct testimony of witnesses, to prove the transaction in which the bond was produced, yet I think that established circumstances irresistibly fix its exact status. By the law as it existed in this State in 183-7, the husband acquired an interest in all choses in action which came to his wife during coverture, and he might perfect such interest into complete title for his own use by any act which would reduce such property into his possession. He could sue for and recover, or release and assign, the debts due to his wife, and when such debts were recovered and brought into his possession, that fact itself was evidence of a conversion of the same to his own purposes, and the moneys thus became, as a general thing, absolutely his own. Webster v. Horner, 4 Vr. 387; 2 Kent Com. 136. It seems to be impossible, under the circumstances established here by the proofs, to escape the conviction that, the bond of Rebecca Ware was reduced by her husband, David, to his possession, and that in process of such reduction the bond here questioned was taken from Joseph and Job Black in the place of Rebecca’s bond. A moment’s consideration of some of the leading circumstances from which I draw this conclusion will manifest their strength. The bond of Rebecca Ware has disappeared. The bond to David^ Ware was drawn by the scriv [23] ener who wrote the bond of the wife, upon a like printed form and for the same amount. It contains the peculiar condition that it shall be payable at the death of Martha Hall, and corresponds in date'so far as the day and month (March 31st) are concerned, and in the time of the payment of interest, and in the rate of interest to be paid. In short, it is a copy of the bond of Rebecca Ware, except in the name of the obligee and the year in the date. Added to this is the recognition of the bond by the Blacks, Waddington and Rebecca Ware, from its date in 1837 until Martha Hall died in 1872, as the representative of the purchase-money debt. It is true, the conveyance to Waddington in 1849, after the date of the David Ware bond, speaks of the existence of a bond to Rebecca Ware, but no such bond appeared. The fact that then David Ware had been dead for ten years, and that before 1849 Rebecca Ware had receipted in her own name for the interest upon this very bond, shows that the bond intended in that deed "is the bond now questioned. From 1826 to 1837 the bond had been Rebecca’s, then her husband reduced it to his possession and made it his property. He died two years later, in 1839, and after that Rebecca had actual custody of his bond, and receipted on it in her own name. After she had so receipted for ten years, Joseph Black conveyed to Waddington, and he then naturally had come to think of the bond as Rebecca’s, and hence he so called it in his deed. The deed just mentioned speaks of a bond of John Den. He was the husband of Margaret Hall, one of the vendors of the Blacks and a sister of Rebecca Ware. Evidently Den, after the fashion of David Ware, had reduced his wife’s bond to his possession. A vendor’s lien is not destroyed by assignment. 1 Lead. Gas. Eq. 289. Much less should it be destroyed by-being reduced to possession by a husband. He succeeds to it by virtue of a legal right to substitute himself for his wife in the ownership of it. The taking of a new bond simply made evidence of the exercise of this legal right. It could make little difference to Mr. Waddington whether the bond was owned by Rebecca or by David Ware. In either event he had, $400 to pay, for he had ample [24] notice and knowledge that that amount of purchase-money remained unpaid. Acting upon this knowledge, he protected himself by withholding from Joseph Black a portion of the purchase-money that he had agreed to pay Black. Such arrangement between the subsequent purchasers did not discharge the original vendor’s lien. For a time Waddington paid interest to Joseph Black, and Joseph Black paid interest to Rebecca Ware, but this roundabout procedure was soon abandoned and Waddington paid directly to Rebecca Ware. Eiually a payment was made to Black’s executor expressly to settle three of the Hall bonds, and among them the Rebecca Ware bond. It is very plain that such a payment would not discharge the Ware lien. The executor of Joseph Black had no authority to receive payment for the administrator of David Ware. I need not settle whether such a payment was in fact made, for if it was, and the money was misappropriated by the executor, the loss must fall upon Mr: Waddington, who selected the executor as his agent to cancel the Ware bond. When Rebecca Ware joined in the deed to the Blacks all that she conveyed was the plot numbered one, which had been set off to her in the partition of her mother’s farm. Hence the lien now sought to be established must be confined to that plot. I will decree that the complainant has a lien upon the plot numbered one for $400, with interest from March 25th, 1872, and will order the plot to be sold to raise and pay that amount, together with the complainant’s costs.