Connely v. Haggarty

Grey, Y. C. The questions in dispute between the parties in this case are almost entirely matters of law. Some contention was made by the defendants in argument that no efficient tender of performance was shown on the part of the complainants, but the testimony clearly indicates that Mr. Connely, in his lifetime, had made known to Haggarty, in his lifetime, that he (Connely) demanded the performance of the contract to convey the premises in question; that Haggarty was unwilling to do so, probably prompted thereto by the suggestions of Daniel M. Haggarty, his son, who was the remainderman in the above-mentioned trust. This unwillingness on the part of Mr. Haggarty to convey the property in accordance with the agreement, was in no way based upon Mr. Connely’s omission to make a full and formal tender of the purchase-money and proffer the deed to be made conveying the premises. It is plainly indicated that, if all these things had been done, Mr. Haggarty would still have refused to convey the property, for he absolutely denied the right of Mr. Connely to have any such conveyance. It is also but a fair inference from the testimony offered in the case, that Haggarty purposely avoided giving to Mr. Connely any opportunity to make the tender in question. It does not lie with Mr. Haggarty, or those who stand in his place, having created a situation which avoided the formalities of a tender, to complain that they were not observed.' The defendants claim that Michael Haggarty had no power to convey the premises in question according to the terms of the agreement, and that, as against Daniel M. Haggarty, the remainderman under the deed of trust, Michael Haggarty’s agreement to convey, is void. Two points are made against the obligation to convey — first, that the agreement was not made by Mr. Haggarty as trustee; second, that the agreement is not, in the mode of its execution, in conformity with the requirements of the deed of trust under which Haggarty held the title. [602] As to the first point, the agreement opens thus: “This agreement witnesseth, That Michael Haggarty, Trustee, residing, &c., * * * cloth hereby let unto Patrick E. Connely, of,” &c. Then follow the lease and. covenants and the agreement to convey, as above quoted. It is signed at the end, “Michael Haggarty, Patrick F. Connely,” with seals attached. The agreement is, in its premises, one made between Michael Haggarty, in his capacity of trustee, witnessed and attested by his signature and seal. It was not necessary to its efficiency as an act done in the capacity of trustee that the full terms of the trust should be recited in the body of the instrument, nor that they should be appended to the signature of the trustee. The undertaking purports to have been made by the trustee; it relates to the trust property. Under it possession of the trust property has been given to the lessee, and rents have annually been received by Mr. Haggarty for many years. It was plainly intended to be a lease and agreement to convey by the trustee, who alone had power to make such an agreement. The contract must be held to have been executed by Michael Haggarty as trustee. The other contention is that by the terms of the Stockman trust deed to Michael Haggarty, the power to convey the property was required to be exercised by a deed or writing by Haggarty, “duly signed, sealed, executed, acknowledged, delivered and recorded,” revoking the trust and granting- the premises, &c. It is argued that the terms of the trust require that the trustee shall both revoke the trusts and grant the trust property. The gift of the power to sell is separated by the disjunctive “or” from the gift of the power to revoke or alter the trusts. Either power may be exercised separately from the other. The exercise of the power to sell the land convej^ed in trust would necessarily revoke the trust, so far as it applies to the land sold, and relate the trust to the purchase-money. The deed, in terms, provides that the sale shall convey the property “freed and discharged of and from any and every trust or limitation whatever,” and further provides that Michael Haggarty should re [603] ccive the purchase-money, and that the purchaser should not be liable for the application of it, and that Michael Haggarty should hold it for the purposes declared in the trust, or such othey new uses as he may appoint. The most significant contention of the defendants is that the trust deed requires that any grant of the trust property must be by a deed or writing by Michael Haggarty, signed, sealed, executed, acknowledged, delivered and recorded; that this is a prescription of the mode in which Haggarty must exercise the power to sell in order, effectively, to pass the title as against Daniel M. Haggarty, the remainderman. The agreement to convey, upon which the complainants rely, was signed, scaled, executed and delivered by Michael Haggarty, and has been recorded, but it was not acknowledged by Michael Haggarty. It was, however, proven by the appended deposition" of H. J. ICeller, the subscribing witness, “that he saw the within named Michael Haggarty and Patrick F. Connely sign, seal and deliver the within instrument as their voluntary act and deed, and that the deponent at the same time signed the same as subscribing witness.” . The defendants contend that this proof is not a compliance with the requirement of the deed of trust that any conveyance made by the trustee of the trust property must be acknowledged by him, and I am referred to the case of Orton v. Metuchen, 37 Vr. 572. In that case a statute- required that the consent of the owner of land fronting on a street that a trolley road should be laid should be “executed and acknowledged as are deeds intended to be recorded/5 The trolley company presented a consent, the execution whereof was not acknowledged, but proven by the subscribing witness. The supreme court held that because of this failure to acknowledge as required by the statute the consent was invalid. The complainants in the case now under consideration insist that the proof of the agreement by the subscribing witness was a substantial compliance with the requirements of the deed of trust in the execution of the power. ' [604] .The rights of the complainants are, I think, to he ascertained and considered from a somewhat different point of view, and are not controlled by the necessity for rigid observance of the manner in which an instrument has been executed, as was enforced by the supreme court in the case cited. The intent of Mr. Haggarty to enter into the agreement to convey the trust property to Mr. Oonnely is, I think, beyond question. The agreement itself is entirely clear in its expression of an undertaking to convey. The clause containing that agreement is all in manuscript, inserted in an appropriate blank provided for that purpose, indicating that it was the subject of especial preparation. Possession of the trust property was given under this agreement,- and rent was paid under its provisions for several years. The intent to lease and to agree to Convey is, I think, so plainly shown- that it cannot be questioned. The defect alleged is not that the power to convey was not intended to be exercised, but that in the execution of it the trustee did not observe with precision the mode prescribed in the gift of the power. It must be noted that Mr. Oonnely, by the agreement of lease and privilege to purchase, became and was a bona fide purchaser of the right to have á conveyance of the trust property if he chose to demand it. This was not a mere option proffered to him, but a privilege, which induced the taking of the lease and •the payment of rent. McCormick v. Stephany, 16 Dick. Ch. Rep. 218, and cases there cited. The situation is this: A donee of a power to convey lands, intending to exercise it, entered into an agreement with a bona fide purchaser, who paid him a valuable consideration for lands intended to pass under the power. The instrument executed by the donee fully shows the purpose on the part of the donee to convey the property. It is not defective in its legal force and effect as an agreement to convey, but only in the manner in which it was executed, in that it does not, with precision, comply with the mode prescribed in the gift of the power. It is, I think, an entirely well established principle that when [605] a part}' undertakes to execute a power, and by mistake does it imperfectly, equity will interpose to carry his intention into effect in aid of those persons who are within its proper consideration. 1 Story Eq. Jur. 170. Equity will extend this remedy to creditors, purchasers for valuable consideration and wives and children of the donee of the power. 1 Story Eq. Jur. 170; 2 Sugd. Pow. ch. 10. The enforcement of this equity does no injustice to Daniel M. Haggarty, the remainderman. He takes under the trust deed apparently as a volunteer, and subject to the possibility of the exercise of the power of sale therein expressed. He still receives under the trust the benefit of the purchase-money of the trust property, and has no equity which is in any way superior to that of the bona fide purchaser from Michael Haggarty, the holder of the power, whose instrument, plainly imtended to execute the power, is defective solely because it was not in terms acknowledged, though it was proven. If it be conceded, that the defendants’ contention is correct, and that the instrument by which Michael Haggarty executed the power was in the manner of its execution defective, the complainants are still entitled to the favorable consideration of this court, on the ground that Mr. Connely, under whom they claim, was a bona fide purchaser for value, and that the challenged instrument sufficiently expresses the intention of Mr. Haggarty to exercise the power, and is defective only in the manner of its execution, and equity will in such a ease aid that by its decree. I will advise a decree for complainants in accordance with the views above expressed.