Caldwell v. Caldwell , 173 Ala. 216 ( 1911 )

SIMPSON, J.

The bill in this case was filed by the appellees against the appellants. The material parts of the bill are that the complainants and the respondent, D. K. Caldwell were owners of the lands described in the bill, which lands had been partitioned among them, subject, however, to an outstanding mortgage on the same, which was held by A. H. Moody, one of the respondents; that said mortgage was foreclosed by decree of court, and at the sale under said decree said Moody became the purchaser for the amount of the mortgage debt; that a few days thereafter said Moody conveyed said land to said D. K. Caldwell, and took from him a mortgage on said lands for the purchase money. The bill alleges that, previous to said sale, the complainants had a verbal agreement with said D. K. Caldwell, by which they were to refrain from bidding at said sale, said Caldwell was to purchase the land, and allow complainants five years within which to redeem the land, that the land was conveyed by said Moody to said D. K. Caldwell on January 20, 1905, and complainants did not know that said D. K. Caldwell had acquired to himself the legal title to the lands, until they discovered the deed on record in the probate judge’s office “in the latter part of the summer of 1905,” and that said D. K. at first recognized the right of complainants to redeem, but has since denied them said right.

It is acknowledged that said verbal agreement is void under the statute of frauds (Code 1907, § 4289) ; and section 3412 also provides that “no trust concerning lands, except such as results by implication or construction of law, or which may be transferred or extinguished by operation of law, can be created, unless by instrument in writing, signed by the party creating or declaring the same, or his agent or attorney lawfully authorized thereto in writing.” The complainants disavow any attempt to enforce the parol agreement, but insist that, regardless of the parol agreement, the act of said D. K. Caldwell, which it is alleged was the result of a fraudulent agreement between him and said Moody to defeat their right of redemption, amounted in equity to a mere redemption by said D. K. Caldwell, which would inure to the benefit of all the several owners of the lands covered by the mortgage. There is no controversy in regard to the proposition that a redemption by one joint owner inures to the benefit of the other joint owners, who have a right to be let in to redeem by paying their aliquot part of the incumbrance; but, without the aid of the parol agreement, it is difficult to see how this transaction can be held to be a redemption.

It cannot be controverted that, under the decree of sale, the holder of the mortgage could become the purchaser, and thereby acquire title to the land, subject only to the right of redemption according to law. When Moody purchased at the sale under the decree, he acquired said title subject to said right; and when he conveyed to Caldwell he conveyed simply the interest held by him, subject to the same equities, unless the relations between I). K. Caldwell and the complainants were such that he could not purcháse the property in his own right. As above stated, the bill shows that the complainants were apprised of the fact that D. K. Caldwell had acquired the legal title to himself within less than a year after the conveyance, so that they had ample time to exercise their right to redeem under the statute, in place of which they waited five years before filing this bill. Pomeroy says: “There are many instances in which equity thus compels the owner of land to forego the benefits of his legal title and to admit the equitable claims of another, in direct contravention of the literal requirements of the statute; but they all depend upon the same principle. The rule under consideration is strictly analogous to another familiar rule that a legal owner of land cannot be turned into a trustee ex delicto by any mere words or conduct. A constructive trust ex delicto can never be impressed upon land as against the legal title by any verbal stipulation, however definite, nor by any mere conduct. Such trust can only arise where the verbal stipulation and conduct together amount to fraud in contemplation of equity.” 2 Pomeroy’s Eq. Jur. (d Ed.) § 807, p. 1488. And he further states that the misrepresentation must be of a fact or facts, as disinguished from a mere promise. “A statement concerning future facts would either be a mere expression of opinion, or would constitute a contract, and be governed by rules applicable to contracts.” Id. § 808, pp. 1435, 1436. Again: “A statement of intention merely cannot be a misrepresentation amounting to fraud, since such a statement is not the affirmation of any external fact, but is, at most, only an assertion that a present mental condition or opinion exists,” although “the statement of matter in the future, if affirmed as a fact, may amount to a fraudulent representation.” Section 877, p. 1561. In'the case of Jones v. Matkin, 118 Ala. 341, 343, 24 South. 242, in which the opinion of the majority prevailed over the dissent of Coleman, J., and Brickell, C. J., it is stated distinctly that the money was paid “to redeem said real estate.”

It cannot be said, then, that there was such fraud in the statements made by D. K. Caldwell as would entitle the complainants to relief. It remains, then, only to consider the question above suggested, to wit: Did D. K. Caldwell occupy such a relation of confidence to the complainants as to preclude him from acquiring title to the entire land, so that any purchase he may have made, either directly or indirectly, under the judicial sale, would necessarily inure to the benefit of the others. It will be noticed that they had all originally occupied the property as tenants in common, having received it from the common ancestor with the mortgage incumbrance on it, but they had made a partition, each owning and occupying a distinct, separate part; but under the facts of this case we hold as to this mortgage they can be considered as being tenants in common, although they had agreed on a partition subject to the mortgage. This court has held that a purchase at tax sale, by one whose duty it is to pay the taxes, operates only as a payment of the taxes. — Johnston & Seats v. Smith’s Adm’r., 70 Ala. 108.

It is true that in the present case, while the property was received by the parties subject to the mortgage incumbrance, yet it cannot be said that the debt was the personal obligation of either of the parties, or that he was under any duty to pay the same. It is stated that, “as a general rule, any person may become a purchaser at a mortgage foreclosure sale who does not stand in such a relation of trust or confidence to the mortgagor as to make his purchase a fraud or breach of duty.” — 27 Cyc. 1482. Chancellor Kent said: .“I will not say, however, that one tenant in common may not, in any case, purchase in -an outstanding title for his exclusive benefit. But when two devisees are in possession, under an imperfect title derived from the common ancestor, there Avould seem naturally and equitably to arise an obligation between them, resulting from their joint claim and community of interests, that one of them should not affect the claim to the prejudice of the other. It is like an expense laid out upon the common subject, by one of the owners, in which case all are entitled to the common benefit.” — Van Horne v. Fonda, 5 Johns. Ch. (N. Y.) 388, 406, 407. It is true that in that case one of the heirs, who purchased, and the question was whether he bought as executor, or not, and the defendant purchased from him, and the court further said: “I have no doubt, therefore, that in a case like the present, and assuming that the evidence warrants us to assume that the deed of May, 1794, was 'taken by the defendant for trust purposes, that the purchase from Moses Johnson ought in equity to inure for the common benefit.”

This court expressed a doubt as to whether one tenant in common would be allowed to set up, as against the others, a title acquired at tax sale (Howe v. Dew, 90 Ala. 184, 7 South. 239, 24 Am. St. Rep. 783) ; and other cases hold that he cannot (Donner v. Quartermas, 90 Ala. 164, 169, 170, 8 South. 715, 24 Am. St. Rep. 778; Bailey’s Adm’r. v. Campbell, 82 Ala. 342, 346, 2 South. 646). The Yon Horne-Fonda Case, supra, and others, are cited; but we do- not find in them any distinct decision. that one tenant in common may not acquire title to the entire tract, by purchase at a judicial sale, under a foreclosure decree. The decisions in other states are not as distinct and harmonious as they might he. In one case where a tenant in common purchased an outstanding mortgage, taking an assignment of it, the court said: “It is then objected that one tenant in common cannot purchase an outstanding title, or incumbrance upon the joint estate, for his exclusive benefit, and assert the same to the prejudice of his co-tenant in any way. That principle cannot be properly applied -to -a purchase of an outstanding mortgage upon the joint estate. Such title may temporarily inure to the benefit of a cotenant who elects to- make such a purchase. But it leaves the other party in the full enjoyment of the right of redemption that he previously enjoyed.” And it was held that, until the cotenant elected to contribute his share, the title, as assignee of the mortgage, was sufficient to prevent a partition. — Blodgett et al. v. Hildreth, 8 Allen (Mass.) 186, 188.

The Supreme Court of Pennsylvania holds that “a conveyance to one of several tenants in common, or a deed to one of two devisees of the same land, shall inure to the benefit of all who came in under the same title and are holding jointly or in common”; the court saying further that, “where several persons have a joint or common interest in an estate, it is not to be tolerated that one shall purchase an incumbrance or an outstanding title and set it up against the rest for the purpose of depriving them of their interests,” and, quoting from Chancellor Kent, in the Van Horne-Fonda Case, supra, says: “Such a proceeding would be repugnant to a sense of refined and accurate justice, and would be immoral, because it would be against the- reciprocal obligations to -do nothing to the prejudice of each other’s claim, which the relationship of the parties created.”— Weaver v. Wible, 25 Pa. 270, 64 Am. Dec. 696, 697.

In a case where one of the heirs of an estate purchased the land at a foreclosure decree based on a mortgage made by the ancestor, and had sold a part of the lands, it was held that a bill was sustainable to require said purchaser to account for the moneys received by him, deducting the amount paid out. by him, and to establish titles in the coheirs as to the unused portions of the land —Tisdale v. Tisdale, 2 Sneed [Tenn.] 596, 599, 64 Am. Dec. 775, 777); the court saying: “Tenants in common by descent are placed in a confidential relation to each other by operation of law as to the joint property, and the same duties are imposed as if a joint trust were created, by contract between them, or the act of a third party.” Upon the same principle, where one of the tenants in common acquired a patent from the government, it was held to inure to all of the tenants in common. — Roberts v. Thorn, 25 Tex. 728, 78 Am. Dec. 552, 554. And the like result was held where one tenant in common purchased the lands, at a sheriff’s sale, under execution on a judgment against all.: — Gibson v. Winslow, 46 Pa. 380, 84 Am. Dec. 552.

While these cases may be differentiated from the one now under consideration, in some particulars, yet all holdrthat,-under the broad equitable principle laid down by the great chancellor in the Van Horne-Fonda Case, there is a confidential relation existing between tenants in common, by which a purchase such as is shown in this case entitles the other tenants in common, within a reasonable time, to demand that the purchase inure to their benefit, on their contributing their proportion.

We hold that under the circumstances of this case the complainants were not guilty of such laches as to deprive them of this remedy, but if, before they elected to demand that the purchase inure to their benefit, any parts of the lands had been sold to bona fide purchasers, their remedy is to require D. K. Caldwell to account for the money received, and not to dispossess such purchasers. From what has been said, it results that the bill has equity, though some of the causes of demurrers should have been sustained.

The decree will be corrected, so as to overrule causes 1, 3, 10, 12, 11 and 15, of the demurrer, and to sustain the remaining causes; and, as corrected, the decree of the court is affirmed.

Corrected and affirmed.

'Anderson, Sayre and Sommervxlle, JJ., concur.