Michael v. Morfy

Bowie, C. J., delivered the ©pinion of this Court. The contract, the true construction and legal effect of which is the subject of the present appeal, was before this 'Court in the ease of Morey, Ex’tx of Michael, vs. Michael, 18 Md. Rep., 228, brought up by appeal of the appellee, ‘Caroline, as executrix of Catharine Michael, from a decree •dismissing the hill on demurrer. That suit was presented by her as executrix, and the demurrer overruled by this Court, upon the ground that •although the will executed by Mrs. Michael, was not a good execution of the power, as to the principal sum covenanted to he paid by Isaac Michael, yet the interest accruing during the coverture, was the sole and separate estate of •the wife, which she might bequeath independently, of the power. In the argument of that case, a prominent point on the part of the appellee was, as in this, that the appellant’s remedy, if any, was in a Court of Law, and not in equity ; ■that the only object of tbe hill was to recover a specific sum •of money, and interest upon a covenant to pay. In other words, it was a contract for the payment of money to be •enforced at law, not a trust resting in confidence, of which equity had cognizance. It became necessary, therefore, in deciding that point, •which went to the .jurisdiction of the Court, and which,<5f — 260 — tenable, would have compelled this Court to sustain tbe demurrer, to examine the character of the instrument exhibited with the bill, (which is the same now exhibited by the appellees with their bill,) and determine ,the rights of those claiming under it, particularly the relation of the appellee in that case (now the appellant) to the principal fund. The views of the Court on this point are thus expressed, “The appellee took the legal title to the property under the contract, with limitations against any beneficial use or interest in himself, and a determination of the character of his relation to it will decide the question of jurisdiction presented by the demurrer.” “Although the contract in some respects is inartificially drawn, it is clear that the intent of the parties to it was, to fix upon the appellee a fiduciary possession of the fund assigned, and create a trust by which the purpose of the testatrix as to its beneficial use and ultimate destination would be accomplished.” The creation of a trust depends upon intention, and when expressions used manifest an intention that the grantee or donee of property is not to have the beneficial use, but is to hold it for the benefit of another, he will be considered as a trustee holding the legal title for the beneficial owner. “A gift or grant of property to a grantee or donee, to be applied to a certain use or purpose, fastens a trust on the holding of the legal estate.” Hill on Trustees, 65. 2 Ves., Jr., 335. 7 Eng. L. & E. Rep., 134. 3 Md. Rep., 505. In this case, we think the appellee took the property assigned by the contract as a fund, with the interest as it might or should accrue- in the lifetime of the testatrix, encumbered with a trust, and notwithstanding the form of his obligation in reference to it, relief in equity may be had for any failure or default on his part in its execution.” 18 Md. Rep., 240, 241. — 261 — Although this point may not have been as fully argued m the former case as in the present, yet it cannot he said that the decision just cited was “obiter dictum,” as the question was directly involved in the issues of law raised by the demurrer to tho bill, and the mind of the Court was directly drawn to and distinctly expressed upon the subject. We consider this construction of the instrument in question conclusive on this point, not because it was made in a suit between the same persons hut different parties, but because the point was “investigated with care and considered in its fullest extent,” which is all that is necessary in this State to render a decision binding as a precedent. Alexander vs. Worthington, 5 Md. Rep., 488, 489. The jurisdiction of this Court being established, the second point raised by the appellants is, that the appellee, Caroline, is not a cestui que trust under the ante-nuptial contract, which should be construed to embrace only a child or children of the marriage which the said Catharine might leave at the time of her death. This construction is based upon the assumption, that there is no allegation in the hill, or evidence in the cause, that Isaac Michael knew his intended wife had any child living at the time of their entering into the^contract, and the fact that the ante-nuptial contract does not refer to any such person specifically. It must he conceded, there is no reference to the fact of a prior marriage on the part of Mrs. Catharine Michael, or of her being a mother, in the agreement referred to, hut the hill expressly charges, she was a widow and had an only child of tender years dependent on her, and the answer of the appellant admits the complainant, Caroline, is the child of Catharine by a former marriage, and there was no issue by her second husband. With these facts, it would be a most unnatural as well as forced construction, which — 262 — would confine the general terms of an ante-nuptial contract, which are broad enough to include all the children of the covenantee or cestui que trust, to those only she might thereafter have, and thus exclude the issue of the first marriage from all benefit of the estate of her mother, previously acquired. The complainant is clearly within the letter as well as the spirit of the contract, as indicated by the circumstances ■of the contracting parties. The appellant’s answer insists, that Catharine Michael violated all the stipulations of the marriage contract without any cause whatever, which he is •advised renders all the covenants and stipulations, to be performed after the death of the said Catharine, utterly null and void, and that he is not, in equity, bound to comply with or perform any of the covenants in said contract not to be performed in the .lifetime of the said Catharine. This position is not, in our judgment, sustained by reason or the weight of authority. Although the articles of agreement between Michael and Baker recite that a marriage is about to be entered into by and between the parties, “and in consideration thereof” the parties agreed to enter into the following covenants ■and stipulations, it is also recited, “First,1 the said Catharine Baker, being possessed in her own right of money, etc., to the amount of $4,250, doth transfer, assign and convey the same to the said Isaac Michael,” and the said Isaac Michael, in consideration of said sum, “doth covenant and agree ito pay, etc., in default of appointment to any child or children she may leave.” It also appears from the said articles, that Catharine Baker owned and occupied a house and lot in Middletown, the rents and profits of which it was agreed she should receive during coverture, for her ¡separate use, with power to sell the same and invest the proceeds as she may direct, for her sole and .separate use. And the said Michael covenanted and agreed, that the — 263 — said.seal estate, or any other she might purchase during the coverture, she might bequeath, or the proceeds thereof, and in default of appointment that such real estate shall descend to, and bo distributed among, any children she may leave, if more than one ; if only one child, that such child shall receive the whole personal estate and real estate which she, the said Catharine, may leave ; and it was further agreed, that nothing In said articles contained shall debar the said Catharine Baker from any right which she may acquire by virtue of her intermarriage with the said Michael, either in the real or personal estate of said Isaac Michael. The articles show, that the intended wife was possessed in her own right of both personal and real estate, the right of disposing of which she was determined to secure, notwithstanding . her marriage, without surrendering her rights in the real and personal estate of her intended husband. They further show the real estate and the proceeds thereof, were to descend to, or be distributed among, any children she might leave, and if only one, that child should receive the whole personal estate and real estate that Catharine Baker might leave. It would be impossible to imagine that terms so clear and comprehensive as these, would not include the only child of her first marriage ; and if they received such construction when applied to the real estate, why adopt a different construction of words nearly identical, when speaking of the personal? It might justly he contended, also, that the words annexed to the covenant relating to the real estate, being subsequent to all others, are broad enough to include, and do include expressly, the whole personal and real estate which Catharine Baber might leave. The consideration of marriage is a valuable consideration, and not only sustains covenants in favor of the wife — 264 — and the issue of the marriage,‘but also covenants for settlements in favor of children of a former marriage as a moral consideration. Cruise, Tit. 32, sec. 752, Vol. Greenleaf Ed. The children are regarded as purchasers. They may enforce the obligations of the contracting parties, notwithstanding the non-performance of mutual stipulations on the other side, unless they are conditional and dependent covenants. Although the defaulting party may not, in some instances, be allowed to enforce the articles specifically, the children, the innocent objects of parental solicitude and care, are entitled to all the benefit of the uses under the settlement, notwithstanding there has been a failure on one side. Macqueen on Husband and Wife, sec. 3, Title “Ante-nuptial .agreements,” and oases there cited. These reasons include as well the issue of°a former as a subsequent marriage. There can be no equity in inflicting upon the only child of a former marriage, dependent on its mother for support in whose behalf provision was made in anticipation of a second marriage, the penalty of forfeiture because of the subsequent misconduct of her mother. In the case of Sydney vs. Sydney, where the bill was filed by the wife for specific performance of marriage articles, and the defence was, she had withdrawn herself from her husband, lived separately from him and very much misbehaved herself, although there was a violent presumption of adultery, the Lord Chancellor Talbot held, that “the articles being that the husband shall settle such and Such lands in certainty on his wife for her jointure, this is pretty much in the nature of an actual and vested jointure ; in regard to what is covenanted for a good consideration to be done, is considered in equity as done, consequently this is a jointure and not forfeitable,, either by adultery or elopement, and it was decided that the husband should perform — 265 — his marriage articles.” 3 P. Wms., 274, 276. Vide, also, Blount vs. Winter, Ibid., (note 2.) 1 Ball & Beatty, 205, mar. page. (Decided January 23rd, 1867.) The cases referred to by the appellant to sustain bis defence, are generally cases where the application was on the part of the defaulting party for a settlement out of her separate estate, in the absence of articles of agreement; in which of course the parties would he remitted to purely equitable rights. Such are the cases cited. 1 Roper on Husband & Wife, 215. Carr vs. Eastbrooke, 4 Ves. 146. Roper remarks, “it may he inferred from Bell & Montgomery, that though the Court may not make a settlement on the wife when living in adultery, yet it will secure her trust property for the benefit of the survivor or her children.” This principle is recognized in many of the cases. There is no pretence here, however, of any misconduct on the part of the wife, greater than the use of intemperate language, and separation from her husband because of unhappy domestic circumstances. There is no ground for any imputation upon her purity as a wife. She maintained reputable associates, notwithstanding her separation. Decree below affirmed, with costs to the appellees.