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Alston v. Maxwell

Supreme Court of North Carolina
Dec 1, 1826
16 N.C. 18 (N.C. 1826)

Opinion

(December Term, 1826.)

1. Morality and good faith require that the vendor shall disclose to the vendee every circumstance which may induce the latter to change his mind as to the contract.

2. Where a trustee sold at vendue a fee simple in the trust land, and before the execution of the contract the trustee and the cestui que trust discovered that the trust deed created only a life estate: Held, that the concealment of this discovery was fraudulent, and vacated the contract, although the trust deed was publicly read and the trustee only undertook to convey the title he had, and although the cestui que trust refused to guarantee the title of his trustee.

From FRANKLIN. Bill for an injunction, the material allegations of which were that one Marmaduke Jeffreys had conveyed a tract of land to Richard H. Fenner in trust to secure a debt due Outerbridge by Jeffreys; that the deed was defective, first, because it was a deed of bargain and sale, and no valuable consideration was recited in it as having passed from Fenner to Jeffreys; secondly, because there were no words of inheritance in it, and at the most it conveyed only a life estate to Fenner. That both Outerbridge and Fenner, his trustee, had express notice of these defects, having been informed of them by two gentlemen of the profession, and that they fraudulently sold the land at vendue, without disclosing the defect in the title of Fenner, when the plaintiff became the purchaser, and gave his bond for the purchase money. It was admitted in the bill that by the terms of sale the trustee was only to convey the title which he held under the deed from Jeffreys, and that Outerbridge had refused to warrant the title of his trustee; but it was insisted that this was intended to apply only to the original title of Jeffreys, or to his estate in the land at the date of his deed to Fenner, and not to the quantity of estate conveyed by Jeffreys to Fenner. In proof (19) of which it was averred that the land was sold as a fee simple, and that the deed from Fenner to the plaintiff was properly drawn to convey a fee, if Fenner had one.

Attorney-General, Seawell, and Badger for plaintiff.

Gaston for defendant.


It was also admitted that the deed from Jeffreys to the trustee was publicly read when the land was sold, but the plaintiff insisted that from his ignorance of the forms prescribed for conveyances he was not aware of the defect at that time, nor did he become so until after the contract was executed. The bill prayed an injunction upon a judgment obtained on the plaintiff's bond for the purchase money, and general relief.

The defendant in his answer denied all fraud, and insisted that the plaintiff had bought with a full knowledge of the limitations in the deed to Fenner.

He also averred that he was informed by his counsel, who drew the deed from Jeffreys, that although it was informal, yet that it conveyed a fee simple in the land. This was fully supported by the testimony of his counsel, Mr. Person.

A witness, Mr. Johnson, proved that he had informed both Outerbridge and Fenner after the sale, but before the execution of the deed from Fenner to the plaintiff, and before the latter gave his bond for the purchase money, of the defects in the deed to the trustee.


I accord with my brethren in saying that this contract should be set aside on the ground of fraud; it appearing from unquestionable evidence that both Outerbridge and his trustee, Fenner, knew before the title passed, and before the plaintiff gave his bond, that the trustee could rightfully make but an estate for his life, such being only the extent of his own estate; notwithstanding the repeated (20) declarations made both by Outerbridge and his trustee at the sale, that only such title as the latter had was offered for sale, and the reading the deed aloud to show what that title was, that the bidders might judge for themselves. It is evident that this was understood to relate to the title, and not the quantity of estate in the lands, and that a fee simple was offered for sale.

Morality and good faith should have induced the defendants Outerbridge and Fenner to disclose to Alston, when about to take his bond, the discovery which had been made, for they certainly knew that such information would have produced a total change in his intentions; and that Outerbridge was about to get from Alston the full value of an estate in fee simple, which he knew that Alston thought he was acquiring, when an estate only for Fenner's life was conveyed to him. Upon strict principles of law, even if Outerbridge and Fenner were really ignorant of the quantity of estate in Fenner, yet as they professed to sell and did contract to sell and estate in fee, I doubt whether they have in reality complied with their contract, or conveyed to Alston that estate which they had contracted to sell. Fenner had but an estate for life, and could by estoppel only convey a larger estate. By a reference in his deed to Alston, Jeffreys' deed to him became part of the deed to Alston. Thus the matter was left at large, there being estoppel against estoppel.

But relief being clear upon the ground of fraud, I give no opinion upon this latter point.


It may be taken for granted, in this case, that it was the understanding of the parties that a title in fee simple in the lands was conveyed from Jeffreys to Fenner, the trustee. This was the understanding of Person, who drew the deed of trust; but it does not appear that the defendants were undeceived in regard to that before the sale of the land to complainant.

Person states that after the execution of the deed of trust he (21) drew another, and recommended to Outerbridge to have the last executed, as it was drawn more fully than the first, though he believed the first was sufficient for all the purposes for which it was given.

However, it seems that after the sale, but before Alston had executed his bond to Outerbridge, and before Fenner had executed the deed to Alston, Johnson, the attorney who drew the deed, informed both Fenner and Outer bridge that nothing except a life estate was conveyed by the deed of trust from Jeffreys to Fenner.

It is true, Outerbridge refused to warrant the title of the land to the complainant; but that was a fee simple title in Jeffreys, for such it was apprehended was conveyed from Jeffreys to Fenner. The ground of refusal was that Jeffreys' title in fee simple might not be good, not that he had conveyed a title less than a fee, or any title less than he had.

When Fenner and Outerbridge were informed by Johnson that only a life estate was conveyed to the former, they were apprised of an important fact relative to the title, to which Alston was a stranger. This fact they concealed. By doing so, they practiced upon Alston that which the law pronounces to be a fraud, and that at a time when they were not in a worse situation than they stood in before the sale, or, indeed, as far as it appears, at any time after the execution of the deed of trust.

I am therefore of opinion that the injunction should be made perpetual. Injunction perpetuated.

TAYLOR, C. J., concurred.

(22)


Summaries of

Alston v. Maxwell

Supreme Court of North Carolina
Dec 1, 1826
16 N.C. 18 (N.C. 1826)
Case details for

Alston v. Maxwell

Case Details

Full title:THOMAS ALSTON v. JAMES MAXWELL AND WILLIE PERRY, EXECUTORS OF STEPHEN…

Court:Supreme Court of North Carolina

Date published: Dec 1, 1826

Citations

16 N.C. 18 (N.C. 1826)