Adams v. Cowherd

Soott, Judge, delivered the opinion of the court. The application of the doctrine in relation to a vendor’s lien for the unpaid purchase money may arise where the vendor makes an absolute deed which conveys away his legal title to the vendee, and also where the legal title is retained by the vendor, he only giving a title bond to convey when the purchase money is paid. The want of attention to this dif [461] ference, among the cases in which the right of a vendor to a lien for his unpaid purchase money has been involved, causes much embarrassment in the examination of this subject. It is obvious that the vendor, ,who retains his legal title and merely gives a bond to convey, is in a very different situation, in regard to the land he has sold, than he who has made an absolute conveyance conveying away the legal title. Where the vendor retains the legal title, the transaction on its face shows that he intends to hold such title as a security. It is just the same as if the vendor had conveyed the land, and afterwards taken a reconveyance by way of mortgage to secure the payment of the purchase money. In such cases ' the question of a want of notice of the equity of the original vendor can not arise, for he who purchases from one whose only title is a bond to convey may easily know the equitable rights of the original vendor, or he is guilty of such gross. negligence as is evidence of a fraud. (Anthony v. Smith, 9 Hum. 511; Graham v. McCampbell, Meigs, 52.) The doctrine in those states in which it is admitted to be law that the assignee of a note given for the purchase money does not acquire by such assignment the lien which the vendor himself had, has no application in cases where the vendor retains the legal title. Itffs only applicable where the vendor makes a full conveyance which passes away absolutely his legal title. This seems to be well settled law. (Lead. Cas. in Eq. 274, 275.) This suit is not to subject Davis to the payment of the note. He is not a party to it, and can not be sued upon it. The action is to subject the land to the debt evidenced by the note; and as Davis acquired the land with a knowledge of the equitable rights of the vendor, he was properly made a party to it. We do not see the force of the objection, that the plaintiff failed to have the note protested, and thereby lost his recourse against his endorsers. - But if the endorsers are dis- . charged, is not Cowherd, the maker, still liable ? As Cowherd was the real purchaser of the land, and gave the note [462] for the purchase money, if the plaintiff has lost his recourse, as is alleged, against some of the parties to it, how does that discharge the debt as to Cowherd ? If the plaintiff had sued the endorsers, and recovered the debt, they would have fallen back on Cowherd; and he being the purchaser of the land, it would, in his hands or the hands of the assignee, have been liable for the purchase money. Reversed and remanded. The other judges concur.