Opinion
11-05-1810
Humphreys' Administrator v. M'Clenachan's Administrator and Heirs
Wickham, for the appellant
[Syllabus Material] [Syllabus Material] [Syllabus Material] [Syllabus Material]
Upon an appeal from the Superior Court of Chancery for the Staunton District.
Alexander M'Clenachan, on the 3d day of October, 1795, entered into an agreement with Alexander Humphreys, in the following words, under his hand and seal. " I have this day sold to Alexander Humphreys, his heirs and assigns, for value received, all and every emolument arising from two land warrants, one for 6,666 2-3 acres, issued to me, and in my name, and 4,000 issued to, and in the name of William Long, for services in the late army against Great Britain, as officers in the Continental and Virginia State lines, as per receipt of R. C. Anderson. All my right, title, interest, claim and demand, in and to the same, I hereby transfer to the said Alexander Humphreys. And if patents have issued in my name therefor, I will transfer the same by deed: if not, I desire that patents or grants may issue to him the said A. H. for it; and all and every expenses that have accrued before this date, I will pay or deduct from the money due me for this land." Neither price, nor the terms, or periods of payment are noticed in this agreement.
On the 21st of the same month, it appears by an exhibit in this cause, that M'Clenachan executed an instrument under his hand and seal, upon the back of a copy of survey filed in the register's office in Kentucky, in the following words: " I Alexander M'Clenachan, of Staunton, for and in consideration of Henry Rhodes having located the within lands, (the 6,666 2-3 tract,) do transfer unto him the said H. R., and his heirs and assigns, one third part of the land contained in the within plat and certificate of survey, and desire a patent may issue in his name, for that part of the said tract." A patent issued on the 22d of March, 1797, to M'Clenachan and Rhodes, jointly, for the lands in the survey mentioned.
A letter from Robert Breckenridge, of Kentucky, dated November 8, 1795, and directed to Alexander Humphreys, mentions " that the writer had, a few days before, heard of his having purchased all M'Clenachan's land in that State, without regard to his previous engagements, and proceeds to inform him that the larger tract was located under his direction, at the particular request and solicitation of M'Clenachan; that, before the locator would undertake the business, he was obliged to engage, on the part of M'Clenachan, to secure to him one third part of the land: and suggests a wish that Humphreys would mention the matter to M'Clenachan, and that one third part of the tract there alluded to should not be taken into the accounts between them; or, if he received an assignment of the whole, that it might be upon condition of Humphreys' satisfying and paying the locator, according to his and Breckenridge's agreement. This letter appears to have been received by Humphreys, and some mention of it appears to have been made by him, in his life-time, to M'Clenachan. When he died does not appear.
After the death of M'Clenachan, which took place in February, 1798, Humphreys brought a bill in Chancery against his administrator and heirs, in which he states the price agreed on for the lands to have been three shillings per acre; that he was to pay 1001. in cash, and for the residue bonds were given; and that he paid the money, of which there is no proof in the record. He proceeds to state the assignment of one third of the larger tract to Rhodes; and that he (Rhodes) had obtained a patent for the whole, and is in full possession thereof: that, with respect to the 4,000 acres, M'Clenachan agreed to allow the locator one third part thereof, for locating; but the complainant had compounded with him for 12l. 10s. per thousand acres, which he expressly charges to be the lowest price; the usual allowance being one third of the land itself: that the administrators have brought suit on his bond, without allowing him any credit for the deficiency in quantity, and for money advanced for taxes and expenses thereon: and concludes with praying for a proportionate credit for one third part of the larger tract, to which the locator Rhodes had a title, and also for the sum agreed to be paid for locating the other tract of 4,000, amounting to 501.; and for his other advances, & c.
Humphreys being dead, a bill of revivor and supplement was filed by his administrator, suggesting, among other things, that there was a valuable Salt-spring upon the land; praying an injunction to the judgments on Humphreys' bonds to M'Clenachan, and for a specific performance of the original contract, as far as it is in the power of the defendants so to do; with ample compensation for such part as cannot be performed.
The Chancellor, by his decree, allowed a credit pro rata, according to the price, for the one third of the larger tract, to which Rhodes was entitled for locating the same; and 12l. 10s. per thousand acres for the smaller tract; together with such other claims, for payments, as the complainant could make appear; and directed an account: and further that the defendants should convey all their title to the lands (and procure Rhodes to join therein, for whatever title he may have to more than one third part of the larger tract) to trustees for the following uses, to wit, that if the plaintiff, or the heirs of Humphreys, (who are not parties in this suit,) or some other person for them, should, on or before a certain day, pay to the administrator of M'Clenachan the balance of the purchase-money, (to be ascertained by the Commissioner's report,) with legal interest thereon, then the trustees to convey the legal estate to the heirs of Humphreys; otherwise, they were to sell as much of the lands as would be sufficient to pay the debt, and to convey the residue, if any, to the heirs of Humphreys.
From this decree the administrator of Humphreys appealed.
Decree affirmed.
Wickham, for the appellant, contended, 1. That Humphreys was entitled to a deduction for the deficiency, in proportion to the value of the land, and not the price he was to give. He bought the whole land; and was not informed that the locator was to have part. It was a frequent practice for the locators to have compensation in money: there was no reason then for him to think that Rhodes, the locator in this instance, was to have part of the land. M'Clenachan's assignment to Rhodes was after the agreement with Humphreys, and could not deprive him of his right to the benefit of his bargain. Rhodes's equity was against M'Clenachan only, not against Humphreys, who was a purchaser without notice. Humphreys therefore is unquestionably entitled to compensation; the only question being about the rate of compensation. The case of Nelson v. Matthews, 2 H. & M. 164, furnishes the rule so far as the circumstances of that case are applicable to this, and shews that actual value, and not the purchase-money, is the standard.
2. The value at the time of the contract is not the proper standard. At that time M'Clenachan had not disabled himself to comply with the contract. The land was never lost by Humphreys until March, 1797, when the patent issued to M'Clenachan and Rhodes jointly. The value, therefore, at the date of the patent is what we contend for.
3. The decree was wrong in directing a conveyance to trustees, and a sale of the land, if the purchase-money should not be paid. Instead of this, it should have directed a conveyance to the heirs of Humphreys. However equitable the decree now in question might have been, if M'Clenachan's representative had sued in equity for the purchase-money, the case is different here. The bill was filed by the administrator of Humphreys for an injunction and specific performance. The heirs of Humphreys, indeed, were not before the Court, and it may be said that we ought to have made them parties. This seems to have been an oversight on both sides; but it was irregular to enter a final decree until the heirs were parties.
The Attorney-General and Wirt, for the appellee, endeavoured to get the contract itself rescinded, on the grounds that it did not appear in evidence that any money had been paid by Humphreys towards complying with the bargain; that M'Clenachan was in habits of intoxication, and was said by some of the witnesses to have been drunk at the time the contract was made. At any rate, the contract, if not to be rescinded, ought not to be specifically enforced in a Court of Equity, being unreasonable and oppressive; and Humphreys, the party now praying specific execution having shewn a backwardness on his part.
1 Vern. 227, Philips v. Duke of Bucks; 1 Fonb. 30, note (o), 2 Eq. Cas. Abr. p. 56, c. 4, Tristam v. Melhuish; Ibid. p. 19, c. 14, Kien v. Stukeley, 2 Bro. Parl. Cases, 396, S. C. 5 Viner. 549, pl. 12, Squire v. Baker, Prec. Ch. 538.
1 Bro. Parl. Cases, Hayes v. Caryll; 2 Bro. Parl. Cases, 447, Wingfield v. Whaley, Sugden, 248.
2. If the contract is to be enforced, it is improper to make any deduction on account of the land conveyed to Rhodes the locator. M'Clenachan bargained to sell Humphreys only his right to the land, such as it was; not knowing whether it stood on a survey, or patent; and subject, of course, to the ordinary deduction for compensation to the locator; which, it is proved, was commonly one third of the tract. The word " expenses" in the agreement related to officefees only; not to part of the land. Can it be believed that he would, if in his senses, have sold the land for three shillings per acre, (which soon afterwards rose to nine and twelve shillings,) and yet have bound himself to make good any deficiency that might arise from the locator's claim. The great inadequacy of price strengthens the conclusion that such could not have been his intention. And, if Mr. Wickham be right in his construction of the contract, the impossibility of M'Clenachan's complying with it, in opposition to Rhodes' prior equity, furnishes an additional reason why it should not be specifically enforced.
3. But, if there ought to be a deduction, the Chancellor has resorted to the most equitable criterion. The original bill itself claimed no more than a " proportionate" deduction, which must be understood according to the value at the time of the contract; which value the parties themselves have fixed at three shillings per acre.
4. The decree was right in holding the land liable to be sold, in case the administrator of Humphreys should fail to pay the purchase-money. There was no necessity to make his heirs parties; their title being merely equitable. Besides, this was not a bill to subject the land, but an application to the discretion of a Court of Equity, which had a right to annex a condition to its decree, (by which the injunction was continued in force,) that, if the administrator, or the heirs of Humphreys, should fail to pay the money by a certain day, the land should be conveyed to trustees, & c. within the principle of the rule that he who asks equity must do equity. This was a favour granted the administrator on certain terms. However, if the heirs ought to have been parties, the plaintiff was to blame in not having made them so: and this Court might now modify the decree so as to direct that if he do not pay the money, by a day appointed, the injunction be dissolved; that the heirs be made parties, and the land ultimately liable. If such a decree as this should be entered, the appellant ought nevertheless to pay the costs; the appellee being the party substantially prevailing.
Cole v. Scott, 2 Wash. (VA) 142.
Ellzey v. Lane's Executrix, 2 H. & M. 589.
Wickham, in reply. If the bargain is void, we are surely entitled to an injunction to the judgments at law. M'Clenachan's administrator enforces the contract by suing on the bonds; yet attempts, in equity, to set aside the contract! If it be binding on one party, it surely is so on the other.
We admit that M'Clenachan sold only his own right. But, having previously parted with one third of the land, he ought to make good the deficiency; for his assignment to Rhodes was a fraud upon us. Humphreys was not guilty of any backwardness in fulfilling the contract on his part; since, until a title was made, he was not bound to pay a farthing. The rule in equity is always to grant an injunction to relieve against the demand of the money, where the vendor is unable to make a complete title. Jolliffe v. Hite, 1 Call, 301; Quesnel v. Woodlief, 2 H. & M. 173, and Nelson v. Matthews, Ibid. 164, were all cases of injunctions to protect the purchaser from being compelled to pay the money. If it had been paid, M'Clenachan's administrator might have disposed of it in the way of administration; and the administrator of Humphreys might not be permitted to recover it back, in case the land should be lost; because he ought to have stopped it in the first instance.
The only question in the cause is the rate of compensation. This must be the value of the land at the time of the contract at least; but, in my opinion, it ought to be the value at the date of Rhodes' patent, which may be denominated the time of our eviction. [*] We were not bound to prove the precise value at the lastmentioned period: it sufficiently appears that it was more than the rate at which Humphreys purchased. The exact amount can be ascertained by reference to a Commissioner or a Jury.
Judge Tucker. Judge Roane. Judge Fleming.
OPINION
Judge Tucker. Judge Roane. Judge Fleming.
Saturday, November 16. The Judges pronounced their opinions.
JUDGE TUCKER stated the case as above, and proceeded as follows:
The point most strongly contested in this Court was, whether Humphreys was entitled to a compensation for the deficiency of the larger tract, (the equitable title to which was, at the time of the contract, in Rhodes,) according to the average price of the whole, or according to the specific value of the land when Rhodes acquired his legal title thereto, by the patent from the Governor of Kentucky. Mr. Wickham contended for the latter.
The price of lands must, in all cases between the seller and the purchaser, be considered as the just value thereof at the time of the contract, regard being had to the terms and mode of payment agreed on between them: in other words, the price is the value, as agreed on by the parties themselves: if the contract be executory on both sides, the party who hath not yet fulfilled his own engagements, comes with an ill grace before a Court of Equity to demand ample compensation, or, more properly speaking, vindictive damages against the other party for any deficiency or failure on his part. Although M'Clenachan, either from want of information of Brecken-ridge's contract with Rhodes, on his behalf, or from some other cause, is alleged to have sold Humphreys the whole of the larger tract, instead of that part only to which he was justly entitled, that circumstance does not so clearly appear from the words of the contract itself, which only imports to convey all his title, interest, claim and demand, and every emolument arising from two land-warrants therein mentioned. It must not be forgotten that these warrants are assignable by law. It does not appear he then knew they were even located; he could not then be supposed to intend specifically to warrant the quality of the lands upon which they might be located: and, without some reference to quality and quantity, as connected with each other, no calculation of value, independent of the price, can possibly be formed. I therefore think the Chancellor's decree correct in making the price per acre the standard by which the abatement from the price is to be made, in regard to the larger tract. With respect to the lesser tract, the only inconvenience or expense which Humphreys has been exposed to, as far as appears by this record, was the compensation of 121. 10s. per thousand acres paid to the locator. This, according to the very terms of the contract, M'Clenachan had agreed to deduct from the amount of Humphreys' bonds. More, the latter could on no principle be entitled to, as was decided, I believe, in the case of Hull v. Cunningham's cexecutors, last term. I approve also of the remainder of the decree, though some objections, not appearing upon the record, might, perhaps, have been taken to it.
See Nelson v. Matthews, 2 Hen. & M. 164.
Ante, p. 530.
JUDGE ROANE.
In the case of Mills v. Bell, 3 Call 320, it was resolved by this Court that, in the case of an eviction after a conveyance made with warranty, the value of the lost land, as at the time of eviction, should give the rule by which the vendee is to be remunerated; for that " the purchaser is entitled, on the covenant, to the increased value of the estate, as well as for any improvements he may have made on it, but that when the contract is executory, a Court of Equity will adjust it upon principles of equity according to the circumstances."
Under the last branch of this position the said case of Mills v. Bell was adjusted. In the case of Nelson v. Matthews, 2 Hen. & M. 164, it was held that the actual value at the time of the contract should give the rule. This case, however, is supposed not to be in opposition to the principle laid down in Mills v. Bell, (ut supra,) as it was the case of a deficiency in the quantity of land sold, and not an eviction of any part of that actually conveyed by the deed. There was no subject, therefore, quoad the matter in controversy, the value of which could have increased, or on which improvements could have been placed: the giving the purchaser, therefore, the value of his purchase at the time, with interest, would do him ample justice. This last case is analogous to the one before us; and the value of the deficient land, as at the time of the purchase, should give the rule in this case as in that: but, as it is not objected that the price contracted for is greater or less than the real value at the date of the contract, I see no reason to depart from that in the present instance; and am for affirming the decree.
The case of Farley v. Shippen, Wythe's Rep. p. 135, is conclusive as to the power of the Court over lands lying in another state, where the persons decreed against are within its jurisdiction. It is true that the commissioners or agents who are to carry the decree into execution ought to be within the jurisdiction, so as to be amenable to the process of the Court. In point of fact, I believe that the commissioners in this case do reside out of the limits of the Commonwealth; but, as this does not appear of record, it is not for us to take the objection.
JUDGE FLEMING.
It is the unanimous opinion of the Court that the decree be affirmed.
[*]Note. --It did not appear that Humphreys was ever in possession of the land. --Note in Original Edition.