Bigley v. Jones , 114 Pa. 510 ( 1886 )

Mr. Justice Clabk:

delivered the opinion of the court,

In this case, binding instructions were given to the jury to find for the plaintiff; this being so, we must assume that the evidence adduced by the defendants is true; we must also assume the truth of every fact which may be fairly inferred therefrom.

Sarah Bigley testifies in substance, that prior to the sale of her father’s estate under the order of the court in partition, on the 25th January, 1866, she had a distinct understanding, or agreement with her husband to this effect: that if he became the purchaser of the property, she would retain her interest in it. She says, she preferred the land before the money, because it was her father’s land, and that her husband was relieved of paying the money by her holding the land. “He agreed.” says Mrs. Bigley, “ that I was to have one fifth, and he wasn’t to pay any money for that; I was to hold my own; he was to buy it in, and I was to hold the fifth.”

This, she says, was the understanding before, at the time of, and alwajm after the sale.

Peter Bigley testifies, that prior to the sale he and his wife made an agreement, that if he would buy the propertj'-, she would take her share in the land, and that he went on and bid the property in, with that understanding.

The deed was made to Peter Bigle3r, and he and his wife went into the possession. .The share of Mrs. Bigley in the estate of her father, although released to the Master, was never paid to her; the testimony shows that it went into the purchase of the land which was convej'ed to Bigley; it was applied as part of the purchase mone3", according to the agreement which existed between Bigley and his wife.

We agree with the plaintiffs in error, that the title of all the heirs, qua heirs, in the real estate of the decedent, was extinguished by the Orphans’ Court sale, and the delivery of the"sheriff’s deed; that the interest of Sarah Bigley was thereby converted into personalty; that she had a right to release her share to the Master in relief of her husband’s purchase; and, that her claim in the proceeds of the sale was, by the release, satisfied.

But, there is evidence to show that the share of Sarah Bigley, thus reduced to persona^, actually went into the purchase of this land; that it was applied as purchase mone}’ at the time of the conveyance; that it was not advanced as a loan, or as a gift to her husband, but as her own ; not as a general contribution, but the contribution of a'specific, definite sum to procure a correspondent interest, or aliquot part of the estate.

Now, it may be conceded, that the alleged agreement, between Bigley and his wife, as a means, per se, of making title in her was of no consequence, but if at the time of the conveyance she paid a part of the purchase money under it, for a proportionate interest in the purchase, under the circumstances stated, a trust would certainly result in her favor to the extent of the purchase money thus paid. The agreement is nothing, except as it discloses the intention of the parties at the time. The trust results from the acts, and not from the agreement of the parties, or rather, perhaps, from the acts accompanied b}r the agreement.

The presumption is, in the absence of all rebutting circumstances, that one who pays the purchase money of land intends to become the owner of it, although ás a matter of convenience, or through an arrangement of the parties for collateral purposes, the conveyance may be in the name of another. The same rule applies if several persons pay the consideration and take the title to one of their number; Morey v. Herrick, 6 Harris, 129; Duffield v. Wallace, 2 S & R., 521; Perry on Trusts, sec. 132. If the parties contribute unequally, the trust results to each of them in proportion to the amount paid by each; Hill on Trustees, 4th Am. ed., 149.

Thus, in Harrold v. Lane, 3 P. F. S., 268, the lands of a decedent were sold by order of the Orphans’-Court, under proceedings in partition to one of the heirs; an ejectment, having been brought by the purchaser, the defendant, another of the heirs, gave evidence that an arrangement had been made that the purchase should be for four of the heirs; that before the conveyance, she had paid the purchaser a sum of money which, with her interest in the estate, would pay her one fourth; and it was held that this was sufficient to establish a resulting trust in her favor for the one fourth of the land, unless negatived in the belief of the jury.

To establish a trust by parol, the evidence must be full, clear and convincing; Lloyd v. Farrell, 4 Casey, 419; Farrell v. Lloyd, 19 P. F. S., 247; McGinity v. McGinity, 13 P. F. S., 39. We are clearly of opinion, however, if the facts be as stated by the defendant’s witnesses, that a resulting trust has been established.

But the plaintiff below, was a purchaser of the lands in suit, at a sheriff’s sale of all the right, title, interest and claim of Peter Bigley, in whose name was the recorded title; the sale was upon a levari facias on a mortgage dated February 1st, 1873, in §6,000, given by Peter Bigley to I. K. Morange, and by him negotiated and assigned to E. P. Jones, in trust for the Smithfield Savings Bank. When real estate is held by a title which is regular on its face, a bona fide mortgagee thereof, or one claiming title under such mortgagee, is not liable to be affected by any secret trust or equity if he be without notice thereof: Sweetzer v. Atterbury, 4 Out., 18. The assignee of a mortgage takes it discharged of the equities of persons not parties to it of which he has no notice ; Mott v. Clark, 9 Barr., 399; Price v. Wood, 7 Casey, 142. So, the purchaser of a title, perfect on its face, for a valuable consideration takes it discharged of every equity of which he had no notice; Reed v. Dickey, 2 Watts, 459; Wightman’s Appeal, 29 Pa. St., 280; Fillman v. Deven, 31 Id., 429.

This brings us to the second question in the cause: whether or not the plaintiff, at the time the mortgage was assigned and at the sheriff's sale, had notice of the secret equity of Sarah Bigley.

It is not disputed that the mortgage to Morange, was made with the express design of having it negotiated for a loan of money. Morange was a broker, and was the agent of Bigley for the purpose. It appears, too, that prior to the assignment of the mortgage by Morange, to the Smithfield Savings Bank, W. C. Friend, Esquire, the attorney of the bank, was directed by the bank to make an examination of the title; that whilst Friend was actually engaged in making this examination, James Fitzimmons, Esquire, the attorney of Sarah Bigley, gave him notice of the trust which had resulted to her from payment of the purchase money.

Mr. Fitzimmons says that either Mr. or Mrs. Bigley spoke to him in reference to the title of Mrs. Bigley, in connection with the fact that Bigley was borrowing money on this real estate, and told him to look after her title, and that acting upon this employment he gave the matter his attention. He says: — “ I afterwards heard incidentally, and I am not sure how, that the Smithfield Savings Bank was taking this mortgage and loaning the money; I made it my business to see Mr. W. C.'Friend, then a member of the bar, and saw him. I said you are examining Bigley’s title for a mortgage. Yes, he said he was, and told me the bank was going to take the mortgage; I then said to him to take care, that Peter Bigley only had four fifths in the tract, his wife having one fifth. I told him that there was an equity proceeding some years before, and that an arrangement was made at that time that she was to retain her one fifth interest in that land instead of taking the money from Mr. Bigley, and that the arrangement was before the partition proceedings were commenced, and during the time they were in action, and that they afterwards always considered ■among themselves that she still held her one fifth interest; then I told him, furthermore, that he had never paid her anything on account of her interest, and that she had still retained possession of it, and was then in possession of her interest in that land.”

Mr. Fitzsimmons further states, that on the occasion of the sheriff’s sale he gave notice to the bidders, of Mrs. Bigley’s title to the one fifth interest in the land, and warned bidders that if they should purchase the property they would only take four fifths interest therein.

■If the statement of Fitzsimmons is accepted, then without doubt the Smithfield Savings Bank and E. P. Jones, trustee, had full notice of Mrs. Bigley’s title; they were bound by the notice to Friend, who was their attorney and agent in this particular transaction, and who gained the information in the very matter in which he was employed; this was notice to his principals: Reed’s Appeal, 10 Casey, 209; Brachen v. Miller, 4 W. & S., 102; Houseman v. Girard, B. & L. Asso., 31 P. F. S., 256.

As the Smithfield Savings Bank thus had notice of Mrs. Bigley’s equity, not only at the time of the assignment of the mortgage, but also at the time- of the sale, they cannot be considered bona fide purchasers for value.

Nor was Sarah Bigley estopped by the decree of the Court of Common Pleas, No. 1, dismissing her bill in equity filed to No. 545, June T., 1877. The prayer of that bill was in the alternative — that Peter Bigley, or E. P. Jones, should be directed to pay to her one fifth of the purchase money for which the land was sold by the Master,'or, that partition be made and her one fifth part of the land be set apart to her in severalty. It is plain that the court had no jurisdiction to grant the first prayer, and the second was rendered impracticable by the denial of the complainant’s possession and title. In the bill for partition, she demanded one fifth of the land to be set apart to her in severalty; but, to this she may not have been entitled, and yet have a right to recover in ejectment oné fifth undivided. Partition is made of lands of tenants in common, when their possession is common ; ejectment is the remedy when the possession of one is adverse to the other. The dismissal of the partition bill, would not necessarily have any conclusive effect upon her claim in ejectment. The Smithfield Savings Bank was entitled to the possession of Peter Bigley, the defendant in the execution, and in the answer, the bank claimed that his possession was of the whole land as an entirety ; the bank’s claim of possession through Bigley was, therefore, adverse to Sarah Bigley, and ejectment, whether by the bank whilst she remained in possession, or by her after she went out, was the appropriate remedy for the determination of her i-ights; Law v. Patterson, 1 W. & S., 185; Longwell v. Bentley, 11 Harris, 99.

The court erred in taking the case from the jury, and in giving binding instructions to find for the plaintiff.

The judgment is therefore reversed, and a venirb facias de novo awarded.