Lord's Appeal , 1884 Pa. LEXIS 126 ( 1884 )

Mr. Justice Trunkey

delivered the opinion of the court, March 10, 1884.

This bill was filed on the 19th of December, 1877, for a decree of specific performance of an alleged oral contract made May 25,1874. It avers that McKinney owned the land, and certain personal property; that the plaintiffs held three judgments against him amounting to $3,400 with interest from November 3, 1871, and also a book account against him amounting to $204.65; that McKinney, by parol agreement,. sold and delivered said land to the plaintiffs in payment of said judgment, agreeing to convey the same whenever requested, and plaintiffs agreeing to satisfy said judgments upon such conveyance; and that he also sold and delivered the personal property in payment of the book account; that McKinney, though often requested, delayed the execution of such conveyance, and after the lien of the judgments expired he refused to convey to them, and conveyed the land to Lord; that the lien of said judgments was lost by reason of the plaintiffs’ faith in said agreement; and that the plaintiffs had held exclusive possession of the land, cleared forty acres and made improvements to value of $1,500.

McKinney admits that he owned and possessed the land, and that the plaintiffs held judgments against him as averred in the bill; but he denies the making of an agreement for sale, and avers that the plaintiff's obtained possession under an agreement to work the farm and account for the-profits; that they have removed timber and bark and injured the-property to an amount greater than the judgments; and he claims protection under the statute for. prevention of frauds and perjuries.-

Lord answered that he bought the land in good faith, without knowledge-of plaintiffs’ claim of an equitable title, and pleads the said-statute. But if the plaintiffs were in possession under a valid contract for purchase of the land, Lord was not an innocent purchaser, and the court rightly ruled that the conveyance to him shall not defeat the plaintiffs’ title: Jamison v. Dimock et al., 95 Pa. St., 52. Then, the real inquiry is whether they have shown a case that warrants a decree for specific performance.

The master finds “ that all the material averments contained in plaintiffs’ bill of complaint relating to the terms of the contract, its execution on the part of H. & B. and the several matters- which entitle them to specific performance are sustained by the evidence.” This is his finding upon which he recommeuds the decree. Specifically, he did not find what improvements were made, nor their value. There is real conflict in the testimony whether the value of what the plaintiffs took off the land did not exceed that of the improvements. Be this as it may, it is certain that no buildings were erected, none repaired, no orchards planted, that the farm was occupied by tenants, and that the improvements can be compensated in damages. He did find, notwithstanding the parties aver and admit that McKinney owned and held possession of the land on May 25, 1874, that McKinney left in April preceding when the tenant of plaintiffs moved upon the land. This fact was corroborative of McKinney’s testimony that in April lie leased and gave possession to the plaintiffs. One of the plaintiffs, William Holbert, and his son were witnesses in support of the allegations in the bill. At first they were positive the contract was made on May 25, but after the closing of the defendant’s testimony, in rebuttal, corrected their first date placing it in April; they fixed the date at first by reference to the credit on their book for the personal property, and at last by reference to an execution issued for the seizure of that property. It may be noted that contrary to his averment in the bill and to the testimony of his son, the plaintiff testifies that the personal property was worth more than the book account, and the overplus was to be credited on the judgments.

The master says that “ the parties alike contradict all testimony conflicting with their respective allegations in relation to the contract,” and thinks the number and consistency of the plaintiffs’ witnesses outweigh the defendants’. He is probably correct in this, but a specific finding of the essential facts would be more .satisfactory than his opinion that “the plaintiffs have met all the requirements growing out of the construction of the Statute of Frauds.

It is noticeable that nothing was paid by the plaintiffs on the alleged contract; they were to satisfy certain judgments on delivery of the deed, and until the delivery, those judgments, were not to be satisfied. So the bill avers and so the plaintiff testifies: Though the lien has expired, the judgments are now record evidence of McKinney’s indebtedness to the plaintiffs. Until the lien expired the parties treated the judgments as in force. On May 1, 1876, the plaintiffs signed and delivered to McKinney a paper as follows:

“ This is to certify that Mahlon McKinney has this day given us his judgment notes of $500 each, due one, two, three, four, five, six, and seven years, making in all $3,500, which we agree to return to said Mahlon McKinney within twenty days from this date, or cancel the judgments we now hold against'him for $3,400 principal. We may do either at our option.” The-meaning of that is the same since the lien of the judgments expired as before. It is neither obscured nor twisted by lapse of time nor pecuniary interest. It accords with the record, while the oral testimony for the purpose of reconciling the paper with the allegation that the judgments were actually satisfied, is inconsistent with both the record and the writing. The three notes on.which the judgments were founded were entered in the plaintiffs’ book of bills receivable; after the expiration of the lien and after the plaintiffs had consulted an attorney, but before the beginning of this proceeding, the plaintiffs wrote on the page where the notes were entered, under the head of, “When and how disposed” these words: “ Paid by all real a,nd personal estate bought of Chapman.”

Both allegations and proofs affirm that the judgments were to stand till conveyance of the land to the plaintiffs, and no time was fixed when the deed was to be executed, other than when requested. It is not averred that the plaintiffs were induced to let the lien drop by any artifice of McKinney. They neglected to procure revival of the judgments. Then they demanded the deed, and then McKinney refused. He denies that he made the contract, but being overweighed by the opposing testimony, says the thing proved is void. His fraud is of the kind which exists wherever a man refuses to perform a parol contract for sale of land, and relies on the Statute of Frauds to prevent its enforcement. Had not the plaintiffs neglected to keep .the lien alive there would be no vague charge of fraud; were it not for the loss, or danger of loss, of their judgments, there would be no- devices to avoid the statute.

The specific findings of fact by the master are taken as true. But all his inferences of fact, resulting from his reasoning cannot be adopted. He did not find that the plaintiffs had-satisfied, the judgments, or treated them as paid, or that they had promptly requested a conveyance and tendered satisfaction, for such finding would hav.e been against the plaintiffs’. own testimony; yet lie infers that the several matters which entitle them to specific performance are sustained by the evidence. In his reasoning, leading to that conclusion, he remarks that a peculiar feature of the case is, that McKinney never had anything invested in the land, nor any interest except the uaked legal title; that the consideration was wholly paid by Holbert and Branning when McKinney purchased, and after holding possession for two years and a half McKinney abandoned the land to Holbert and Branning as a payment of the debt. Of course, that is figurative, for if true, McKinney was a naked trustee, and the plaintiffs the real owners. The bill makes no such averments. There it appears that McKinney owned the land and was debtor to the plaintiffs.

Although the fact of a parol agreement for the sale of the land is sustained by the weight of the evidence, among the salient points of the case are, the conflicting testimony respecting the contract, and that the possession is as consistent with the lease averred by the defendants as with the purchase averred by the plaintiffs; the possession was recent, less than four years prior to commencement of the action, and the improvements such that the extent and value thereof can be easily proved and admit of compensation in damages; that the parties treated the judgments, the consideration, as remaining in force until their lion expired; and the insolvency of McKinney was as well known to the plaintiffs at the date of the contract, and while the lien of the judgments was unexpired as it has been since. Should such a contract, under the circumstances, prevail against the statute ? This question cannot be affirmed without grave doubt, for the case comes with its discrepancies arising from fallible memory, if not from evil motive. If a chancellor will act when there is doubt, such cases will be frequent, and the uncertainty of titles to real estate be increased. To take a case out of the operation of the statute, its proof in all essentials and its equities should be so plain as to preclude doubt or hesitancy in reaching a conclusion.

Where the proofs were unsatisfactory it was ruled that the case was within the statute, unless there was such part performance as could not be compensated in damages: Postlethwait v. Frease, 31 Pa. St., 472. It has been said that there must be proof of expenditure for improvements not reimbursed by profits derived from the occupation of the land, and not capable of compensation in damages recoverable in an action for the breach of the contract, to take the case out of the operation of the statute: Hart v. Carroll, 85 Pa. St., 508. But where the purchase money has been paid, and exclusive possession given in pursuance of a parol contract for the sale of land, and the vendee has made no improvements, equity-will enforce specific execution of the contract, on the ground that the insolvent vendor shall not have both money and land: Jamison v. Dimock, 95 Pa. St., 52. Every day’s experience more fully demonstrates that the statute for prevention of frauds and perjuries was founded in wisdom, 'and is necessary to preserve the title to real property from the uncertainty attending the admission of parol testimony. Where one purchases a tract of land by parol, pays all his money, receives, full possession and holds and uses it as his own, equity interferes so as to prevent the vendor from converting the statute made to prevent frauds into an instrument of fraud. The party who claims the interference of the chancellor has the burden of proof. He is presumed to know that the law required the contract to be in writing. When he asks the court to save him from the consequences of his own disregard of the law, he should be held to proof of the requisite facts beyond a doubt. If a chancellor were to act on doubtful parol proof, on strained and fanciful inferences, or vague surmises, he would annul the wholesome provisions of the statute in search of a visionary equity, and introduce into the community the very evils which the legislature intended to remedy: Per Grier, J. Woods v. Farmare, 10 Watts, 195.

Upon the whole testimony we are of opinion that the plaintiffs are not entitled to a decree for specific performance.

Decree reversed, and bill dismissed at the costs of the appellees.