Opinion
09-06-1852
RAGSDALE v. HAGY & others.
Floyd, for the appellant. B. R. Johnston and Samuel Logan, for the appellees.
1. QUÆ RE: If in an action by an assignee of a bond against the obligor, the obligor can set up an offset which at the time of the assignment was an equitable offset, but which by an arrangement made by him subsequent to the assignment, became a legal offset.
2. A vendee of land being entitled to come into equity to enjoin a judgment recovered by an assignee on a bond given for the purchase money, on the ground of difficulties in the title, and it being doubtful whether he can get a title; though the title is decreed to him in his suit, he is entitled to set up in equity offsets he held against his vendor prior to the assignment; and he was not bound to plead them at law: and this especially as one of the offsets arose out of the contract of sale, and another was only an equitable offset at the time of the assignment.
3. The bonds assigned being for the purchase money of a part of a tract of land, and the vendor selling the other part to a third person, the assignees being defeated in recovering the money from the vendee whose bonds they held, have no lien on the purchase money of the other part of the land.
In October 1840 Martin Hagy obtained from the judge of the Circuit court of Washington county an injunction to two judgments recovered against him in that court, one by Lewis Smith as assignee of John Snead, and the other by Greenway & Co. as assignees of the same party. The bill charges that the plaintiff, on the 3d of August 1839, purchased of John Snead and John Ragsdale a piece of land, part of a tract descended from Benjamin Clark, at the price of eight dollars per acre, for which they executed to him their bond with condition to make him a good title. That on the 26th of the same month, Snead sold to the plaintiff another parcel of the same tract, of one hundred acres, at the same price, for which Snead executed his bond with condition to make the plaintiff a good title. That at the date of the first contract the plaintiff paid to Snead, in money and bonds, 423 dollars 88 cents; and, as the quantity of land embraced in that purchase was not then known, he took Snead's bond for this sum, payable in land at eight dollars an acre. That he apprehends that one of the bonds transferred to Snead, amounting to 90 dollars, had not been made, and if not, that sum was to be deducted from the amount of Snead's bond. That for the second purchase the plaintiff, on the 26th of August, executed his bond to Snead for 500 dollars, and on the next day he executed to Snead another bond for 276 dollars; the first of these bonds had been assigned to Greenway & Co. and the other to Lewis Smith. That at that time the number of acres embraced in the first purchase was not known, but it had been since ascertained to be forty-three and a third acres.
It was further stated that Snead and Ragsdale had purchased a tract of about two hundred and ninety-two acres from Benjamin Fulcher, of which that purchased by the plaintiff was a part; that Fulcher had purchased from Jacob Clark, and had the legal title; that he made a deed for the land to Snead and Ragsdale, which was placed in the hands of Charles C. Gibson, who was to hold it until the purchase money was paid; that there was yet a balance of purchase money due to Fulcher; that Snead was insolvent, and plaintiff apprehended Ragsdale would not pay it unless coerced. That Snead had conveyed to him the land he had purchased, but Ragsdale had not, and plaintiff apprehended he should not be able to obtain a title to the land except through the interposition of the court. That the one hundred and forty-three and a third acres purchased by himself was not as valuable as the remainder of the land purchased from Fulcher, as all the buildings and the spring were on this last mentioned part of the tract.
The bill further stated that at the time the plaintiff executed the two bonds for the purchase money of the one hundred acres of land, he was the security of Snead to James Orr on a bond for 300 dollars, due the 27th of November 1838; that in January 1840, seeing that he would have this money to pay, he executed to Orr his bond for the amount, upon Orr's giving him some indulgence, and took in the bond of Snead. That Snead was indebted to him by a note for 50 dollars, due the 3d day of February 1839, subject to a credit of 13 dollars 41 cents. That on the 30th of January 1840, John McDaniel assigned to the plaintiff two promissory notes executed by Snead, one of them for 75 dollars, due the 2d of January 1839, and the other for 80 dollars, due the 2d of January 1840. That these notes were, however, assigned by McDaniel upon the understanding that he was to take them back and account for them, if the plaintiff did not succeed in using them as offsets against the bond of 276 dollars, which, the plaintiff had reason to believe from Snead's conduct, had not then been transferred to Smith or any other person; certainly plaintiff had not then any notice of the assignment to Smith, though he had notice of the assignment of the other bond to Greenway & Co.
The bill further stated that John M. Preston, claiming as assignee of Jacob Clark, had instituted a suit in the County court of Washington to subject the land purchased by Fulcher to satisfy a balance of the purchase money which he alleged was still due upon that purchase; but that although the plaintiff was in possession of the one hundred and forty-three and a third acres of the land which he had purchased, at the time that suit was brought, he had not been made a party to that suit.
The bill further stated that Fulcher had sold to Snead and Ragsdale in July 1839, and put them in possession of the land. That when the plaintiff purchased, Snead seemed to have exclusive control of the land purchased on the western end of the tract of two hundred and ninety-two acres. Whether Snead and Ragsdale had then agreed upon a partition of the land, plaintiff did not know; nor does he certainly know that they had ever agreed upon a partition; but that possession had been given to the plaintiff about November 1839, which he had peaceably held, and that he was ready and willing to perform anything that remained unperformed on his part, if the title to the one hundred and forty-three and a third acres should be secured to him. And making Snead, Ragsdale, Benjamin Fulcher, Greenway & Co. and Smith defendants, the bill prayed for an injunction to the judgments, that the title of Snead and Ragsdale to the land purchased from Fulcher might be confirmed; that when this was done, Ragsdale might be compelled to convey to the plaintiff the land purchased by him; or, if the land could not be conveyed to him, that the contracts might be rescinded; that if the plaintiff's title could be confirmed, he might be allowed the setoffs before enumerated against the judgments, and for general relief.
Snead in his answer admits the purchase by himself and Ragsdale of the land from Fulcher: that he sold the forty-three and a third acres to Hagy, and that this sale was afterwards assented to by Ragsdale, and Hagy paid him, as stated in the bill, 423 dollars 88 cents. He says that by a distinct contract he sold to Hagy the one hundred acres, for which Hagy executed to him the two bonds of 500 dollars and 276 dollars. That after the purchase of the land from Fulcher, Ragsdale, by a verbal agreement between him and Snead, surrendered to Snead the entire management of the whole, with the understanding that Snead was to be responsible for the payment of the purchase money to Fulcher, and might dispose of the land in any way he thought proper: That whilst this understanding existed, he sold to Hagy the one hundred acres of land mentioned in the bill: That Snead having failed to pay the purchase money to Fulcher, Ragsdale had agreed with Snead to take the remainder of the land which had not been sold as his half of the land, with the understanding that if it measured more than the amount sold by Snead to Hagy, that Ragsdale was to pay for the surplus, at the rate of 10 dollars per acre; and in pursuance of this agreement Snead had executed a title bond for it.
He further states, that the purchase money to be paid to Fulcher was 3000 dollars; and he proceeds to state how much of this he had paid, amounting to more than a moiety: that he does not know how much is yet due to Fulcher, though the amount is small, and will be paid whenever Fulcher can make a complete title to the land, or release it from the supposed lien of Preston.
Ragsdale in his answer denies that Snead had paid half of the purchase money to Fulcher. He says that all the purchase money has been paid except 200 dollars, which he would pay but for the claim of Preston; and for excess beyond his moiety of the purchase money, which he may be compelled to pay, he holds the land itself responsible. He admits that soon after the purchase from Fulcher he said to Snead that if he would pay for the land he might take the benefit of the contract wholly to himself; but denies that he gave Snead any control of his moiety of the land, except upon this express condition. He denies that he and Snead jointly sold any land to Hagy. He says he never heard of the sale until Hagy called upon him to sanction the contract and unite in the title bond of Snead, which Hagy then held, and he positively refused; as he also refused to sanction the second sale. That before their purchase from Fulcher, Snead had become indebted to him in a large amount; and he did not begin to suspect Snead's solvency until some short time after the purchase: That so soon as his fears on that subject were excited, he uniformly told both Snead and Hagy that he would unite in no contract or conveyance in relation to the land purchased of Fulcher, which would in any way impair his rights, until he was made safe as well in reference to the purchase money of said land as to the individual debt which Snead owed him. That matters stood thus until the 11th of November 1839, when he made a contract with Snead, by which Snead was to sell him his interest in the Fulcher lands, as to which Hagy did not then hold the title bond, at 10 dollars per acre; and that the amount to which Snead would be entitled, was to be credited on the debt which Snead then owed to Ragsdale; and Snead then executed his title bond accordingly. That after this, in 1840, Hagy and Snead again called upon Ragsdale in relation to their contracts aforesaid, and Ragsdale then agreed to sign the title bond for the tract of forty-three and a third acres, and indemnify him against his securityship to Orr for Snead, upon his relinquishing his contract for the one hundred acres, which Snead agreed should be taken by Ragsdale. That it was in part fulfillment of this contract that Ragsdale signed the title bond for the forty-three and a third acres: That he offered to procure Hagy's release from his securityship to Orr, but that Hagy then refused to comply with his part of the agreement. He denies that there ever was a partition of the lands between himself and Snead, or that he ever agreed to take as his portion of said land what remained unsold to Hagy by Snead after their two contracts, or that he is under any obligation to convey to Hagy his interest in the one hundred acres embraced in the last contract between Hagy and Snead.
Greenway & Co. and Smith also answered the bill. They both say that the assignments to them were for full value, and without any notice on their part of the offsets and equities now attempted to be set up by the plaintiff. They object that the offsets should have been pleaded at law; and that not having been done, and no excuse being given for the failure to do so, that a court of equity will not allow them to be set up in that court. That as to the notes assigned to the complainant by McDaniel, that was not an assignment for value, but for the benefit of McDaniel.
The title bonds referred to in the bill and the answers are filed. That from Snead to Ragsdale recites the purchase by Ragsdale from Snead of one hundred and fifty acres of land, and binds Snead to procure a good title to be made for it to Ragsdale on the payment of the whole purchase money at 10 dollars per acre.
The cause came on to be heard in October 1842, when the court was of opinion that the plaintiff was entitled to have a conveyance of the two tracts of one hundred acres and forty-three and a third acres purchased by him from Snead; and that he was entitled to a credit on his bonds in the hands of Greenway & Co. and Smith, for any actual deficiency in the land: And as to the other offsets claimed, the court reserved the question until the final hearing. And it was decreed that an account be taken by a commissioner of the court to ascertain how much of the purchase money was still due to Fulcher, and also how much of said purchase money had been paid by Snead, and how much by Ragsdale; and the commissioner was directed to ascertain the value of that part of the land sold to the plaintiff and the value of that part retained by Ragsdale, and also the value of the deficiency in the land sold to the plaintiff.
The commissioner made his report in April 1845, to which the defendant Ragsdale filed three exceptions, the first and third of which related to the amount of purchase money due to Fulcher; the second related to the amount of purchase money he had paid.
In May 1846 the cause came on again to be heard, when the court, without deciding upon the exceptions, recommitted the report, and directed the commissioner to ascertain and report, 1st. What sum Ragsdale would have to pay for the lands purchased by himself and Snead from Fulcher, to equalize them as to the value of the lands held by each, taking Snead's portion to be the lands claimed and held by the complainant. 2d. What sum the complainant has paid towards the purchase of the one hundred and forty-three and a third acres of the land held by him, so as to show what credits he will be entitled to set off against the judgments of the defendants Greenway & Co. and Smith; and in ascertaining the amount paid by the complainant, the commissioner was directed to ascertain whether the complainant did not ultimately pay as assignor the note of 90 dollars assigned to Snead, on Clevinger and Clarke. 3d. To calculate the interest up to the next term on the debt due to Fulcher for purchase money.
In September 1846 the commissioner again made his report, in which he submitted two statements of the payments made to Fulcher: In one of these statements he omitted a credit to Snead of 318 dollars, the amount of his bond executed to Fulcher September 1st, 1839, for the balance of one of the bonds of 1000 dollars, executed by himself and Ragsdale for the purchase money of the land. It did not appear what had become of this bond of Snead's, and there was no one setting up any claim to it. The second statement allowed a credit for the amount of this bond. On the first statement there was due to Fulcher 610 dollars 79 cents; on the second there was due to him 219 dollars 61 cents. Disallowing Snead a credit for this bond, and the amount of his payments to Fulcher was 1146 dollars 31 cents; allowing the credit, his payments amounted to 1506 dollars 33 cents, being 256 dollars 33 cents more than his proportion. The payments made by Ragsdale were 1331 dollars 81 cents, being 418 dollars 19 cents less than his proportion.
As to the payments made by Hagy for the lands purchased of Snead, the commissioner reported, that at the time of the first purchase Hagy paid to Snead in money and bonds 423 dollars 88 cents. That of the notes thus transferred one was upon Clevinger and Clarke for 90 dollars. This note was afterwards transferred to various persons, until it was at length sued upon, and at the May term 1840 a judgment was recovered against Clarke, (Clevinger having left the county,) and there was a return of " no effects." Suit was then brought against Hagy as assignor of the note, which suit was afterwards dismissed by the plaintiff. The commissioner also reported the debt of 50 dollars due from Snead to Hagy, subject to a credit, and the debt of 300 dollars for which Hagy was the security of Snead to Orr, and which he had paid. Allowing him these credits and there was due from Hagy for the purchase money of the lands purchased by him of Snead, on the 10th of January 1840, 376 dollars 9 cents.
Ragsdale excepted to the report of the commissioner because it did not set out the amount which appeared to have been advanced by him to Snead to be applied to the payment of the purchase money of the land bought of Fulcher.
Greenway & Co. and Smith also excepted to the allowance to Hagy of the credit for the balance of the note for 50 dollars, and of the amount of the debt due to Orr.
In May 1847 the cause came on again to be heard, when the court overruled the exceptions to the report, and confirmed it; and taking the value of the land as reported by the commissioner held by Ragsdale to be 1750 dollars, and the value of that held by the complainant to be 1250 dollars; and Snead having paid more than his portion by 256 dollars 33 cents, the court held that under the circumstances of the case this sum should be applied for the benefit of the assignees, Greenway & Co. and Smith. And allowing to the complainant the credits allowed by the commissioner, the court dissolved the injunction as to the sum of 381 dollars 25 cents, with interest from the 10th day of January 1840, but without damages; and perpetuated it as to the residue of said debts. And it was further decreed that Ragsdale should pay the said sum of 256 dollars 33 cents to the commissioner of the court, to be apportioned between Greenway & Co. and Smith; and that Hagy should pay to the same commissioner the sum of 381 dollars 25 cents, to be apportioned in like manner. And it was further decreed that the amount of purchase money due to Fulcher should be paid into court at its next term, until it could be ascertained who was entitled to it; Fulcher himself being a bankrupt. And until said purchase money was paid, the court suspended any further order in relation to a conveyance of the land. There was a decree in favor of the plaintiff against Ragsdale for his costs, and that the other defendants should each pay their own costs. From this decree Ragsdale applied to this court for an appeal, which was allowed.
Floyd, for the appellant.
B. R. Johnston and Samuel Logan, for the appellees.
ALLEN, J.
The final decree allowed to the appellee Hagy certain offsets against the two bonds executed by him to Snead, for the purchase money of the 100 acres of land. The bonds were dated acording to the allegations of the bill, on the 26th and 27th of August 1839; and were assigned, one of them to Greenway & Co. and the other to L. Smith on the 29th of the same month. Suits seem to have been brought by the assignees, immediately after the notes became payable. No defence was made to the action at law, and the office judgments being confirmed, the appellee during the same term of the court, obtained this injunction. It is contended on behalf of Snead's assignees, that the offsets were legal, and should have been set up at law; that the appellee has shown no good reason for failing to rely upon them at law, and they should not therefore be allowed in equity. The principal offset was the note to Orr in which the appellee Hagy was a surety for Snead. It was past due when Hagy executed his bonds to Snead, but the debt had not then been arranged with Orr. Finding afterwards that he would be compelled to pay the debt, he settled with Orr, and lifted the note on the 10th of January 1840. When his notes were assigned by Snead, Hagy had no claim to a legal offset against the notes. The setoff was merely equitable, and there might be some doubt whether by his own act in adjusting this debt, he could convert that, which at the date of the assignment was an equitable, into a legal offset, of which he could have availed himself at the trial at law. However that may be, it seems to me the case was proper for a court of equity on other grounds.
Hagy had made a contract with Snead for the purchase of a portion of a tract of land held in common by Ragsdale and Snead, and received from them a title bond dated the 3d of August. On the same day Hagy paid to Snead in cash, and transferred paper to him amounting together to 423 dollars 88 cents, and took from Snead his note in which it was stated that the amount thereof was to be discharged in land at 8 dollars per acre. The parties did not know at the time the quantity of land which the boundaries described in the title bond would contain; and the substance of the arrangement was, that after deducting the price of the land sold when the quantity was ascertained, the residue of the sum of 423 dollars 88 cents was to be discharged in land at the same price.
Before the quantity described in the title bond was ascertained, Hagy and Snead entered into another contract, whereby the former purchased of Snead the tract of one hundred acres, at 8 dollars per acre, and executed his two bonds for the sum of 776 dollars of the purchase money: how the residue of the purchase money was adjusted, does not appear from the record. Before these bonds became due, difficulties arose as to the title of both tracts sold to Hagy. The land was part of a tract of two hundred and ninety acres, which had theretofore been purchased of Jacob Clark, one of the heirs of Benjamin Clark, by Benjamin Fulcher. In July 1839, Fulcher sold the land to Snead and Ragsdale for 3000 dollars, of which 1000 dollars was paid on the day the contract was completed, and the residue was to be paid in two installments, for which bonds were given; and a deed for the land was executed by Fulcher to Snead and Ragsdale, and placed in the hands of a third person, to be held as an escrow, and delivered upon the payment of the purchase money. Soon after the contract of purchase, there was some understanding or agreement, as appears by the answers of Snead and Ragsdale, by which Snead was to take the land and pay the purchase money; and it was no doubt after this understanding and whilst Snead exercised the control over the whole tract, that he undertook to sell off a portion to Hagy, and to put him in possession of the part so sold to him, although no partition had been made between Snead and Ragsdale. In his answer, Ragsdale avers that before their purchase from Fulcher, Snead had become largely indebted to him, and that he did not begin to suspect Snead's solvency, until some short time after the purchase. But that so soon as his fears about the circumstances of Snead were excited, he informed both Snead and Hagy that he would unite in no conveyance or sale of the land until he was made safe as well in reference to the purchase money, as in relation to the individual debt of Snead; and that matters so stood until the 11th of November 1839, when they entered into the contract of that date filed with his answer; which recites that Ragsdale had purchased from Snead a tract of 150 acres of land, and Snead undertook to procure a good title to be made to Ragsdale, on the payment of 10 dollars per acre. The amount of Snead's interest in this contract, Ragsdale alleges was to be credited on Snead's private debt.
In consequence of these arrangements, it is insisted for Ragsdale, that he is entitled to the whole of 150 acres, and furthermore that he is also entitled to a moiety of the 100 acres sold by Snead to Hagy, under their joint purchase, as he had not united in the sale.
Besides the claim of Ragsdale to a moiety at least of the 100 acres, the tract in consideration of which the two bonds were executed, it appeared that a portion of the purchase money was still due to Fulcher, the vendor of Snead and Ragsdale; but the amount so in arrear was uncertain, and has only been ascertained upon the settlement of transactions between these parties, of an involved and complicated nature.
In addition to this, it was alleged that there was a considerable portion of the purchase money still unpaid by Fulcher to his vendor Jacob Clark. That the claim had been transferred to John M. Preston, who had instituted and was then prosecuting a suit in the County court of Washington county, to subject the land to the payment of this debt.
Such was the position of Hagy when sued upon the bonds he had executed for the price of the 100 acres. The legal title was outstanding and his vendor could make him no title. No partition had been made between Snead and Ragsdale, and the latter under the joint purchase, claimed a moiety of the land as his. There was an admitted balance of the purchase money due to the immediate vendor of Snead and Ragsdale. A claim was asserted and a suit was depending to subject the land to the payment of a debt alleged to be due to a more remote vendor; and Snead, it is averred in the bill, and appears to be admitted throughout the record, was at that time insolvent. Hagy was compelled to resort to a court of equity to clear up the difficulties about the title; and that being his position, was it incumbent on him to set up his offsets in the action at law? The right to enjoin the payment of the purchase money where there is an incumbrance on the land purchased, is well settled. In Virginia, an injunction will be sustained after a conveyance, although there has been no actual eviction, but upon proof of a better title to the land in a third person. Ralston v. Miller, 3 Rand. 44.
There could be no doubt, therefore, if the bonds had remained in Snead's hands, that a court of equity would have enjoined the payment until the difficulties about the title had been removed. It was uncertain, when the suits were instituted and the judgments confirmed, whether Hagy would get anything by his purchase. The alleged incumbrances for the purchase money covered the whole tract; and if the pretensions of Ragsdale were well founded, there would be little left for Hagy under his purchase from Snead. Though Snead might hold his bonds, which at law constituted a debt, it was still necessary to go into equity to ascertain whether in fact any debt existed. His bill, therefore, prayed that the contract of purchase should be rescinded, and his obligations canceled in the event of his being unable to get a good title to the land.
In this state of uncertainty, it would have been improper to have relied on his offsets at law, for it would have been an admission that there was a valid debt against him to the extent of the offsets, whereas he owed nothing unless he could get the land. That was the principal controversy, and that could be settled in equity alone. When it was so settled, and a debt ascertained to be due, it would be proper to enquire into the offsets. If the offsets had been offered and allowed at law, and it turned out that no title could be made, he would be driven to another action to recover the amount of the offsets for the failure of the consideration; and thus by requiring him to rely on his offsets at law, on the penalty of losing them entirely, he might be compelled to surrender bonds and securities constituting evidences of debt, and be driven to recover the money back in an action of assumpsit for the failure of the consideration. A portion of his offsets arose out of the contract in relation to the land itself. He had paid 423 dollars 88 cents on his first purchase. The land when surveyed, in the progress of this suit, was found to contain 43 1/3 acres, amounting, at 8 dollars per acre, to 348 dollars; leaving a balance, which, by the terms of their arrangement, was to be paid in land. This was an offset which could only be ascertained and fixed by a survey. Under every view of the case, it seems to me the court of chancery was the proper forum to decide upon the validity of the debt; to ascertain whether anything was due; and then as an incident to the principal subject of which it clearly had jurisdiction, and to avoid multiplicity of actions, to pass upon the offsets, no matter what was their character. But where, as in this case, a portion arose out of the contract of sale and purchase, and another portion was an equitable offset at the date of the note and the assignment, it would have been competent for a court of equity to have allowed them, although not relied upon at law. If Snead were the party claiming the benefit of the judgments, I do not think he could be heard to make this objection; and unless Hagy has done something to waive his equity, as regards the assignees of Snead, they can occupy no higher position. It is not alleged or proved that they were induced to take the assignments in consequence of any assurances from the obligor. They stand like all other assignees, and take the obligations assigned to them subject to all the equities which affected them in the hands of Snead. There is nothing whatever to distinguish their case from that of other bona fide assignees who have paid their money for that which turned out to be of little or no value. The obligor has been guilty of no laches in the assertion of his equity. Suit was instituted, and judgments recovered at the earliest possible period after the notes fell due. He interposed no delay, and at the first term after the notes became payable, filed his bill, convening all the parties to settle the difficulties about the title, and to ascertain whether anything would be due from him, and to distribute it amongst those entitled to it, according to their rights. I think the court had jurisdiction to allow the offsets claimed by the appellee Hagy, and that there was no error in the decree directing an account of such offsets, and overruling the 1st, 2d and 3d exceptions of the assignees Greenways and Smith to the second report of M. C. Lynch, allowing some of said offsets. An objection was made in the argument here to allowing a credit for the sum of 423 dollars 88 cents, the full amount of cash and notes advanced and transferred to Snead at the time of the first purchase, because the bill suggests a doubt whether one of the notes so transferred, a note on Clevinger and Clarke for 90 dollars, had been made. The commissioner in his report sets forth facts, which unexplained justified him in treating it as a payment to Snead; and as there was no exception to the report crediting Hagy with the 423 dollars 88 cents, it is too late to raise the objection here.
Nor do I think there was any error in so much of the decree as held that the appellee Hagy was entitled to a conveyance from Ragsdale, as well for the 100 acres for which he held Snead's title bond as for the 43 1/3 acres for which he held the title bond of both. The allegation in Ragsdale's answer that when he became a party to the contract of the 3d of August 1839, by signing the title bond, it was agreed between Hagy, Snead and himself, that the contract of the 26th of August 1839 should be canceled, is an affirmative allegation, unsupported by proof. His pretension to claim the 150 acres in virtue of his contract with Snead of the 11th November 1839, and a moiety of the 100 acres as a joint purchaser with Snead, it appears to me is unfounded. It appears from the facts in the case, that Snead made the contract with Fulcher, and Ragsdale subsequently united with him in the purchase. It is alleged in the bill that when the appellee Hagy purchased, Snead seemed to be exercising exclusive control over the land purchased, and had placed him in possession, which he continued to hold without interruption. The answers of both Snead and Ragsdale admit that there was an understanding between them that Snead was to take the entire tract and pay the purchase money. It was during this arrangement that Snead sold a portion of the land to Hagy. One of the purchases was sanctioned by Ragsdale, by his uniting in the title bond, though the whole consideration had been paid to Snead. It furthermore appears from the report of the commissioner that Snead had advanced more of the purchase money to Fulcher than the value of the land sold by him to Hagy. Under these circumstances, and if there had been no other arrangement between Snead and Ragsdale, the latter should not be permitted to disturb the sales made by his cotenant, sanctioned in part by himself, and made at a time when by his own agreement, the whole subject had been committed to the control of his cotenant; and when too, more than a moiety of the land remained undisposed of, exceeding in value the amount paid by him on the joint purchase. The agreement of the 11th November 1839, though somewhat obscure in its terms, when construed by the light of surrounding circumstances, so far from disaffirming, impliedly sanctions the sales made by Snead. Finding that Snead was unable to comply with the arrangement to take the whole tract and pay the purchase money, Ragsdale agreed to take what remained unsold upon the terms mentioned in the agreement. In consequence of the arrangement under which Snead had claimed the whole tract, the new agreement recited that Ragsdale had purchased the 150 acres from him, and made no allusion to their joint ownership under the purchase from Fulcher. The 150 acres was the residue after deducting the portion sold to Hagy. The court rightfully construed these transactions as being equivalent to an equitable partition, and properly held that the purchase should be apportioned between them according to the value of the lands held by each, taking Snead's portion to be the land sold by him to Hagy. Nor do I think there was any error in overruling the 2d exception of the appellant Ragsdale to the first report of the commissioner. His first and third exceptions were in effect sustained by the decree of the 25th May 1847. Nor was there any error in overruling his exceptions to the second report of the commissioner, or in so much of the decree as ascertained that there was a balance of 219 dollars 61 cents due to Fulcher on account of the purchase money, with interest from the 15th December 1840 until paid; and that Snead had overpaid the sum of 256 dollars 33 cents beyond his proportion of the purchase money. But it seems to me the Circuit court erred in holding that this surplus overpaid by Snead should enure to the benefit of Snead's assignees, to compensate them in part for that portion of their debts which was lost by allowing Hagy's offsets. The assignees had no lien on this fund; their notes were a lien on the land sold to Hagy, but that lien did not attach to the land retained by Ragsdale. For the sum so overpaid, Snead would stand in the place of the vendor, and could subject Ragsdale's portion; Tompkins v. Mitchell, 2 Rand. 428; but his assignment of Hagy's bonds did not transfer this lien to his assignees. If a portion of the debts assigned be lost, the assignees stand like other general creditors, with no right to subject any specific fund of the assignor to their indemnity. In the present case, it appears from the admissions of Snead and the evidence in the record, that he was debtor on private account to Ragsdale in a much larger sum than the amount of purchase money overpaid by him. He cannot therefore require Ragsdale to pay the excess to him, or charge it on Ragsdale's portion of the land if the latter chooses to give him credit for the amount on their private accounts. This is a matter for adjustment between themselves, and not involved in the present controversy. The appellee Hagy was only so far interested in the accounts between Snead and Ragsdale, as they related to the payment of the purchase money of the land sold to him; and when it was shown that Snead had paid so much of the purchase money as was equal in amount to the value of the land, he had established all that was necessary to his case. I think the court also erred in not charging the balance of the purchase money due to Fulcher on the 150 acres of the land held by Ragsdale, and in omitting to decree a sale of it unless the money should be paid to the commissioner of the court within some limited time; as Hagy should not be delayed in procuring his legal title by the omission of Ragsdale to pay the balance of the purchase money.
As to the suit by Preston to subject the land to the lien of a remote vendor, the record does not disclose what disposition was made of it. This matter seems not to have been noticed farther in the progress of the cause by the parties or the court, and it has probably been determined against the validity of the claim, as was stated by the counsel.
The other judges concurred in the opinion of Allen, J.
The decree of the court is as follows:
The court is of opinion that the Circuit court erred in holding that the overpayment of the purchase money by the appellee Snead should enure to the benefit of Smith and of the Greenways, the assignees of the bonds executed to him by the appellee Hagy; and in decreeing that the appellant should pay the sum of 256 dollars 33 cents, with interest, to the commissioner of the court, to be apportioned between the assignees ratably. The assignees had no lien on that fund, and could not object to the same being applied by Snead to the payment of his individual debt to Ragsdale, or to prevent the latter from setting off the private debt due to him by Snead, against the amount aforesaid ascertained by the decree to have been overpaid by Snead. This was a matter to be adjusted between Snead and Ragsdale, their private accounts not being in issue in this controversy.
The court is further of opinion that as the appellee Hagy went into chancery to ascertain the amount of and to clear up the incumbrances, to the end that he might obtain a title to the land purchased by him, the court should have gone on and rendered a decree against the appellant for 219 dollars 16 cents, the balance of the purchase money due to Fulcher, with interest from the 15th December 1840 till paid; and unless paid within a prescribed period, the 150 acres of land belonging to Ragsdale should have been subjected to sale for the payment thereof, so that upon the payment of said incumbrance, the deed executed by Fulcher to Snead and Ragsdale could have been delivered for recordation, or a decree could have been entered for the execution of a new conveyance by Fulcher or a commissioner in his behalf to Snead and Ragsdale, if the deed delivered as an escrow at the time of the purchase could not be produced; and a decree also pronounced for a conveyance to the appellee Hagy, by Ragsdale and Snead, or by a commissioner in their names, for the 143 1/3 acres described in the title bonds made exhibits with the bill.
It is therefore adjudged and ordered that said decrees, so far as the same are herein declared to be erroneous, be reversed and annulled, and that in all other respects the said decrees be and the same are hereby affirmed. And it is further adjudged and ordered that the appellant recover of the appellees, except the appellee Hagy, his costs about his appeal; and it is further adjudged and ordered that the appellee Hagy recover of the appellant his costs by him about his defence here expended, he being the party substantially prevailing, so far as his interests were affected by said appeal. And this cause is remanded for further proceedings according to the principles aforesaid, in order to a final decree.