Millard v. . McMullin , 1877 N.Y. LEXIS 727 ( 1877 )

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[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] The general question upon the merits is whether John McMullin had any title to the premises in controversy on the 7th day of December, 1867, upon which the judgment docketed on that day against him in favor of the plaintiff and one Frisbie was a lien. The plaintiff claims title by virtue of a sale upon an execution issued upon that judgment, and a sheriff's deed given in pursuance thereof. A brief reference to the leading facts is pertinent to a proper understanding of the points involved. In 1843, John McMullin and his brother, Daniel, succeeded by devise to the title of their father, Angus McMullin, who held a durable lease (as it is called), being in the form of manorial leases from Morgan Lewis, granting the premises in perpetuity, reserving a fixed rent and containing various provisions and conditions not necessary to refer to. This title was an estate in fee simple, subject to the payment of the rent reserved, and the performance of the other conditions, the landlord having the right of forfeiture and re-entry for the non-payment of rent and the non-performance of the other covenants. (6 N.Y., 467.) If this title continued, it is conceded that the judgment would attach as a lien. John and Daniel held and occupied the premises under this title until April, 1847, when Daniel sold his undivided half interest by parol to John, the latter taking possession of, and claiming to own, the whole. The consideration for this sale and purchase was secured by the promissory note of John. Daniel never executed a deed or other writing, and a question is made whether John acquired a title in fee under this purchase.

Though a tenant in common enter without claiming adversely to his co-tenant, yet his possession may afterwards become adverse by notorious acts and claim of title. (5 Cowen, 483.) The act of purchase and assumption of exclusive ownership, under the circumstances constituted, I think, an adverse possession. There can be no question, but a court of equity would have decreed a specific performance and compelled Daniel to convey the premises, subject, perhaps, to a lien for the purchase-money. Whatever the rights of Daniel may have been to demand an equitable lien for the purchase-money, it is undisputed that the purchase-money was adjusted to the satisfaction of Daniel, and hence the claim of John was absolute and unqualified to the ownership of the whole, and for the purpose of an adverse possession the purchase-money should be regarded as paid. (14 Wend., 227; 8 Cow., 597.) This possession, therefore, ripened into a title in twenty years, which period had elapsed before the docketing of the judgment. A question of more difficulty arises out of the intervening contract made between Mr. Livingston (who succeeded to the rights of Morgan Lewis) and John McMullin. It is dated November 1, 1861, and is in the ordinary form of a contract of sale and purchase of land between owner and purchaser, by which Livingston agreed to sell, and McMullin agreed to purchase, the premises for $1,080, payable in six annual installments, and it is provided that if the payments were made the former would convey to the latter the premises by deed, and if not performed, it was provided that the grantor might re-enter, and that the grantee should, in that case, be a tenant at sufferance. It is claimed that this contract constituted a substituted relation between the parties to that existing under the perpetual lease, and hence, that from that time the title of John McMullin dropped from a legal to an equitable title, and that the legal title became vested in Livingston as trustee. The transaction is found by the learned judge, who tried the case, to have been quite different in intention and fact. The findings upon this branch of the case are that the value of the premises at the time was $3,000, the consideration, $1,080, leaving as the value of the interest of McMullin about $1,900; that the consideration was made up of the amount of the rent in arrear, less sixty-one dollars and three cents agreed to be deducted, and the value of the future rent reserved estimated at three dollars an acre; that the consideration specified was the true value of the landlord's interest for rent due and reserved, and that the intention of the parties was only to sell and purchase that interest without changing or disturbing the title held by John McMullin under the lease. There was no negotiation for any change or relinquishment of title. There was no agreement to surrender the lease, and it was not in fact surrendered. A surrender can only be made to a reversioner or remainder-man, and there was, therefore, no surrender in law. Nor was there a merger as a greater cannot be merged into a lesser estate. Nor do I think that the doctrine of estoppel applies to prevent John McMullin from holding the title which he had under the lease. Estoppels are mutual, and if he was estopped the landlord was.

In the case of Springstein v. Schermerhorn (12 Johns., 357) there was an agreement to surrender the old lease and substitute a new one with different provisions. The new lease was executed, and after several years the court held that a surrender of the old lease would be presumed and the landlord estopped from claiming it. Here there was no agreement to surrender, and none in fact. In equity contracts will be construed as the parties intended. A deed will be held a mortgage if the parties so intended, and this may be shown by parol. The landlord held the obligation of the tenant to pay rent due and to become due. He liquidated the future rents at a gross sum and took this contract as security for that sum and the amount of the rent due. If the contract had not been performed he could have resorted to the remedies provided in the lease. He held the lease, and there was nothing inconsistent in the contract with his right to fall back upon those covenants. It may be that these remedies were suspended during the running of the contract. The contract was in fact performed by the defendant Bell, the assignee of John McMullin, and at his request, so that it is not indispensable to pass upon rights of the parties as if it had been unperformed. The point is, what right in the land Bell acquired by performing the contract and taking a conveyance from Livingston. It was held below that he acquired a lien on the premises for the amount thus paid, but did not acquire the title of John McMullin held under the perpetual lease. He purchased the rights of Livingston under the contract, which may be regarded in the nature of a security for the amount specified. Livingston had no other interest by the contract to sell. As between Bell and John McMullin the former could have enforced this contract and nothing more, but McMullin's title under the lease remained, and as he never conveyed, or in any manner transferred that title, it follows that the lien of the judgment attached. I concur upon this point with the court below, but with some hesitation, as the transactions create some obscurity. It is of some pertinence that all the parties treated the title as in John McMullin. He executed, in 1872, a mortgage to Daniel for the purchase-money of the latter's interest in the premises, which mortgage was purchased by the defendant Bell, and for the amount of which he is protected by the judgment in this action. The result adopts the real instead of the formal acts of the parties, and disregards technicalities in furtherance of substantial justice. The defendant Bell is protected by having the amount paid to Livingston declared a lien prior to the judgment, and also the mortgage given by John to Daniel for the purchase-money. There is, however, deducted from the amount of these claims $322.50, being the amount which Bell realized from the land prior to October 1, 1873. The sheriff's deed was not given until September 24, 1873. The plaintiff, by the judgment, recovers the land, and this deduction from Bell's claim inures, therefore, to his benefit. I do not see what right the plaintiff has to this sum. He was not the owner of the land until he received the sheriff's deed, and this sum was realized before that time. According to the theory of the judgment John McMullin was, during that period, the owner and entitled to the rents and profits. At all events the plaintiff was not.

The judgment must, therefore, be modified by adding the $322.50 which was deducted from Bell's claims, and as modified, affirmed without costs to either party as against the other in this court.

All concur, except EARL, J., dissenting.

Judgment accordingly.