Gaylord v. Gaylord, 150 N.C. 222 (1909)

March 10, 1909 · Supreme Court of North Carolina
150 N.C. 222


(Filed 10 March, 1909.)

1. Deeds and Conveyances — Uses and Trusts — Delivery—Intent-Parol Evidence — Parties.

When a deed reciting a valuable consideration paid, contained a habendum, “to have and to hold” the land conveyed, “tree and clear oí all privileges,” etc., “to the grantee and his heirs in fee simple,” and has full covenants of seizin and warranty, and in other respects gives clear indication that an absolute estate was intended to pass, evidence tending to show a.failure of consideration is incompetent, in an action to establish a resulting trust between the original parties in favor of the grantor, for such can never obtain when there is a contrary intent clearly expressed in the deed.

2. Same — English Statute of Frauds.

The seventh section of the English Statute of Frauds, which forbids the creation- of parol trusts or confidences of land, etc., unless manifested and proved by some 'writing, not having been enacted here, and there being no statute with us of equivalent import, such trusts have a recognized place in our jurisprudence, but they cannot be set úp or' engrafted in favor of the grantor upon a written deed conveying to the grantee the absolute title to lands and giving clear indication on the face of the instrument that such a title was intended to pass. ■

3. Deeds and Conveyances — Uses and Trusts — Written Instrument— Parol Evidence — Incompetency.

The doctrine of engrafting by parol a trust upon lands conveyed by deed is subordinated to a well-recognized principle of law, that such a trust cannot be established between the parties in favor of a grantor in a deed, when the effect will be to contradict or change by contemporaneous stipulations and agreements, resting in parol, the written contract, clearly and fully expressed.

4. Deeds and Conveyances — Escrow—Delivery—Intent.

In order to the valid delivery of a deed absolute or by way of escrow, it is essential that the instrument should pass from the possession and control of the grantor to that of the grantee or some one for him, with the intent at the time that the same should become effective as a conveyance immediately in the one ease and as the happening of a given event in the other.

*2235. Same — Evidence—Depository—Physical Delivery.

The intent referred to and required for a valid delivery is not •conclusively established by the manual or physical passing of the deed from the grantor to the grantee or some one for him; and if it is shown by the proof that, notwithstanding this physical delivery, it was the understanding and intent of the parties at the time that the grantee should hold the deed merely as a depository and subject to the control and call of the grantor, in' that event there would be no valid delivery and the title to the property would not pass.

6. Deeds and Conveyances — Delivery—Intent—Contracts Ex Mali-flcio.

The maxim, Ex maliflcio non oritur contractus, does not obtain when no right is asserted by reason of such a contract and when the right otherwise exists; and hence it is competent for a party having title to show that a deed had not in law been delivered, under which the adverse party in- possession seeks to establish a right growing out of a fraudulent transaction.

CONNOR, X, concurring. Walker, X, concurs in concurring opinion.

ActioN tried before Guión, J., and a jury, at December Term, 1907, of Beaufoet.

Tbe plaintiffs, devisees, children and beirs of Ebenezer Gay-lord, deceased," seek to recover possession of land which formerly belonged to their father, Ebenezer, from their uncle, Sam Gay-lord, who is now in possession, claiming to own the land under an alleged deed to himself from his brother Ebenezer, bearing-date 13 November, 1884.

The evidence tended to show that some time in the year 1884 Ebenezer Gaylord, having some trouble with his first wife, Deborah, and his father-in-law, in order to place his property so that his wife could establish no claim upon it in case of litigation, had a deed prepared and made it over to his brother, with the understanding and agreement that Sam was to give the deed back to Ebenezer when the latter should call for it. No consideration was paid by Sam, the defendant, or any one for him, and, so far as it appears, Ebenezer continued in control and possession of the property till his death, in November, .1898; that Ebenezer afterwards married a second wife, named Mary, and had by her a number of children, plaintiffs in the suit, and, while it is not so stated in the record, it was admitted on the *224argument that Sam bad obtained tbe possession of tbe property after tbe death of bis brother, on marrying Mary, bis brother’s widow.

Speaking to tbe facts attending tbe transaction, Dr. Bullock, who seems to have prepared the deed, testified as follows: “Sam Gaylord asked me to come to my office; that Ebenezer wished to make him a deed, as be was in trouble, and for fear that bis wife would get a part of bis property in a suit she wanted to bring. I told him Ebenezer was doing a dangerous thing. Tbe reason I said this was because it was a conditional deed. He said, 'I am making this deed oyer to my brother Sam to keep Deby, my wife, from getting bold of a portion of my property.’ These were bis very words. Said be was willing to trust bis brother to return tbe deed when it was all over. I then probated it. .Sam promised to return it. After Ebenezer died, Sam came to me and told me Ebenezer bad made him a deed, and asked me about registering it. I told him be bad agreed to return it. I bad nothing to do with it. Tbe. purpose of tbe deed was to cut bis wife out of tbe land. No money was paid then, though it may have been paid before or after that.”

Columbus Gaylord testified as follows: “Ebenezer Gaylord was my father. ' He died in 1899. Tbe other plaintiffs are my brothers and sisters, and children of bis second marriage; they are minors.” (Counsel reads description of land in deed, will and complaint.)' “Witness says be knows it; it is all same land. My father’s first wife was Deborah. His second wife, my mother, is named Mary. -Defendant is in possession of this land. I beard a conversation between my father, tbe grantor in tbe deed, and tbe defendant, a year or two before he died, about tbe deed. Defendant told my father that tbe paper be held be burned up.”

W. L. Judkins testified as follows: “I knew Ebenezer Gaylord and Sam Gaylord; was present at tbe time be signed tbe deed to Sam Gaylord. Both witnesses to tbe deed are dead. Tbe agreement between Ebenezer and Sam was that Sam was to bold tbe deed until Ebenezer bad made some arrangements, then Sam was to return tbe deed to bis brother. Ebenezer was baying some trouble with bis wife — I don’t know what — with her *225father and about farming. I don’t know wbat the trouble was. Afterwards they met in my presence and Ebenezer approached him about the deed, and Sam told him he had made way with it; he did not have it. No money was paid. He made this deed to his brother until he could arrange his troubles at that time; seemed to be a deed to help him arrange things. No interest in suit. I never saw the deliverance of it; wasn’t there when he handed it to him. Trouble was over his wife and wife’s father. She was talking about bringing a suit against him for her separate maintenance. He had some trouble about his farming up there, and seemed to want to leave this deed in the hands of his brother until he could settle these troubles.. It was all the land he had that I knew of.”

R. W. Harris testified as follows: “I have heard a conversation between Ebenezer and Sam Gaylord, three years before Ebenezer died. Ebenezer asked him about the deed. Sam said he didn’t have it; he had burned it. Ebenezer said, ‘It’s a damn lie; you got it to give to my folks trouble about when I am dead.’ I heard him talking about it before, and they all seemed to know that Sam had it. This time they had a quarrel about it.”

W. W. S. "Waters testified: “I heard Ebenezer say to Sam, ‘I have given you that deed as a brother, and you as a brother ought to give it back, as you promised.’ Sam said, H have destroyed it.’ Ebenezer said, ‘You agreed to return it to me; I now want it back.’ ”

At the close of the testimony of plaintiffs, on motion of defendants, there was judgment as of nonsuit, and plaintiffs excepted and appealed.

Ward & Grimes and Bragaw & Harding for plaintiffs.

A. O. Gaylord and Small, MacLean & McMullan for defendants.

Hoke, J.,

after stating the case: The alleged deed recites a valuable consideration paid by defendant Sam Gaylord, the grantee in the deed; contains a habendum, “to have and to hold the said tracts of land, free and clear of all privileges and appurtenances thereunto belonging, to the said Sam M. Gaylord *226and bis heirs in fee simple, forever,” and also the covenants, “that the grantor is seized of the premises in fee simple and hath the right to convey the same; that they are free from all encumbrances, and that the grantor will warrant and defend the title to the same against the lawful claim of all persons,” etc.; and the authorities are to the effect that in a deed of this character, giving on the face clear indication that an absolute estate was intended to pass, either by the recital of a valuable consideration paid or by an express covenant to warrant and defend the title, no trust would be implied or result in favor of the grantor by reason of the circumstance that no consideration was in fact paid. Dickenson v. Dickenson, 6 N. C., 279; Squire v. Harder, 1 Paige Chan., 494; Hogan v. Jaques, 19 N. J. Eq., 123; Lovett v. Taylor, 54 N. J. Eq., 311; Jackson v. Cleveland, 15 Mich., 94. And while the opinion in Dickenson v. Dicken-son, supra, has been so far modified in Barbee v. Barbee, 108 N. C., 581, as to permit proof that in fact no consideration was paid or that the same was different from the recital, this modification was on a question not presented here, and in no way affects the principle that in a written deed purporting to pass to the grantee an absolute title the recital therein of a valuable consideration paid will prevent an implied or resulting trust in favor of the grantor arising from the lack of consideration. Thus Shepherd, J., for the Court, delivering the opinion in Barbee v. Barbee, 108 N. C., at p. 584, after saying that while the trend of our State decisions heretofore had favored the position that the recital in a deed of a valuable consideration paid should be held to be an estoppel for all purposes, yet “The overwhelming weight of American authority is in favor of treating the recital as only prima facie evidence of payment as in the case of a receipt, the only effect of the consideration clause being to estop the grantor from alleging that the deed was executed without consideration in order to prevent a resulting trust.”

This doctrine of a trust or use resulting to a grantor when there was no consideration paid was a rule of the common law incident chiefly to conveyances of feoffment, and never obtained when there was a contrary declaration made by the grantor at *227the time of the conveyance, either oral or written, and in the rare instances where the doctrine is applicable to written instruments it is neve^ allowed to prevail when there is a contrary intent clearly expressed in a written deed. Thus, in Jackson v. Cleveland, supra, Campbell, J., said: “Accordingly, either the mention of a consideration, although nominal, or the declaration of uses will prevent a resulting trust and confirm the title in the feoffee. A court of chancery has never ventured against the expressed will of the donor appearing on the face of the deed to take the use from the donee and give it back to the donor. In other words, uses annexed to a perfect gift, however gratuitous, were enforced.”

And Walton, the Chancellor, in Squires v. Harder, supra, said: “No resulting trust can be raised or effectuated to the express terms of a conveyance and in fav.or of a grantor. In this case the complainants have given an absolute conveyairce, with warranty; they are therefore estopped from alleging that a part of the consideration was received in their own money.”

Nor do we think it permissible upon the evidence that the plaintiffs should engraft a parol trust on a deed of the kind presented here by express declaration or agreement. The seventh section of the English Statute of. Frauds, forbidding “the creation of parol trusts or confidences of lands, tenements or heredit-aments, unless manifested and proved by some writing,” not being in force with us, and no statute of equivalent import having been enacted, these parol trusts have a recognized place in our jurisprudence and have been sanctioned and upheld in numerous and well-considered decisions. Avery v. Stewart, 136 N. C., 436; Sykes v. Boone, 132 N. C., 199; Shelton v. Shelton, 58 N. C., 292; Strong v. Glasgow, 6 N. C., 289. Upon the creation of these estates, however, our-authorities seem to havei declared or established the limitation that except in cases of fraud, mistake or undue influence, a parol trust, to arise by reason of the contract or agreement of the parties thereto, will not be set up or engrafted in favor of the grantor upon a written deed conveying to the grantee the absolute title, and giving clear indication on the face of the instrument that such 'a title was intended to pass. Dickenson v. Dickenson, supra; Bonham v. *228 Craig, 80 N. C., 224; Jackson v. Cleveland, supra, reported also in 90 Amer. Dec., 226, with, a full and learned note on this phase of the doctrine; Dean v. Dean, 6 Conn., 285; Cain v. Cox, 23 West Va., 594, 605; Dyer v. Dyer, White and Tudor Leading Oases in Equity (Yol. 1, part 1), pp. 314, 344, 354, 355, 356, etc.

In this last reference will be found a comprehensive and very satisfactory treatment of this question in the notes by the American editor, in which the writer refers to the North Carolina decisions as establishing the proposition stated, and, among other things pertinent to the inquiry, says: “The second head (that presented here, when the deed purports to be for a full and valuable consideration but is in fact gratuitous) is also capable of subdivision. The trust may be set up between the original parties or in favor of a third person. In the former instance the objection is twofold, under the provisions of the Statute of Frauds, and that the evidence contradicts a writing under a seal. See Porter v. Mayfield, 9 Harris, 264. The trust cannot be alleged consistently with the deed, because it is impossible to believe that the grantee gave a full and valuable consideration forthe privilege of holding the land for the use of the grantor. / A deed may be regarded in two aspects: In one it is'the means by which the title is conveyed; in the other, a memorandum of the terms and conditions of the transfer. If a man deliberately executes a sealed instrument, reciting that he has transferred the right of ownership for value received, he should not be permitted to put the grantee to the proof of that which has been established with the 'Utmost solemnity known to the law. I This is the more true because such a disguise is generally” adopted for some sinister purpose, to defraud creditors or deprive'a wife of dower. See Murphy v. Hubert, 4 Harris, 50. If there be any instance to the contrary, it is better that the grantee should suffer for his folly in putting the transaction in a form contrary to the truth than that the stability of titles should be endangered by rendering it impossible to frame a conveyance that shall be secure from attack. Leman v. Whetlet, 4 Russell, 323; Porter v. Mayfield, 9 Harris, 264, post; Hogan v. Jaques, 4 C. E. Green, 123. If it be proved that the deed *229was misdrawn through aeeideut or fraud, or that it was procured through undue influence (Legenfelter v. Richey, 8 P. F. Smith, 485), a trust may arise dehors the instrument; but this depends on other principles.”

The law was so held in Bogett v. Hildreth, 103 Mass., 484, where Wells, J., used the following language in delivering judgment : “As to the share of Lucinda, conveyed by her to Sophro-nia, without consideration, and upon an agreement to reconvey or hold it for the benefit of Lucinda, no valid trust arises from that transaction. Walker v. Locke, 5 Cushing, 90. A voluntary deed is valid between the parties as a gift, and does not raise any trust in favor of the grantor. It is otherwise with a feoffment, and perhaps in other conveyances, wherever there is no declaration of the uses or the consideration is open to inquiry in determining the effect of the deed between the parties and their privies. Cruise Dig. (Greenleaf Ed.), title 11, ch. 4, p. 16, and title 32, ch. 2, p. 38. In this Commonwealth the consideration is not open to such inquiry. Supposing the deed in question to have been in the common form, the recital of a consideration and the declaration of the use to the grantee and her heirs in the habendum, are both conclusive between the parties and exclude any resulting trust to the grantor. Squire v. Harder, 1 Paige, 494; Hill on Trustees, 112; 2 Story’s Eq., p. 1197; Philbroke v. Delano, 29 Maine, 410; Farrington v. Barr, 36 N. H., 86; Graves v. Graves, 9 Foster, 129.” See Haigh v. Reye, 4 L. R., Ch. Appeals, 473.

It was held in like manner in Wilkinson v. Wilkinson, 17 N. C., 378, that the recital of a valuable consideration is conclusive on the parties and those claiming under them, unless it is shown to have been introduced by mistake or fraud. Gaston, J., said: “The plaintiffs here allege that the defendant caused this consideration of value to be untruly inserted in the deed, either without the knowledge of the grantor or by availing himself of the misconception of the grantor, that it was a necessary form to give the instrument validity. The parol evidence is admissible to support this charge; for if it be made out, then the instrument must be considered as if it had truly been what the contracting parties intended it to be. But it is admissible for this purpose only.”

*230Tbe main current of decision is in tbis direction and establishes that a trust cannot be fastened on an absolute deed by evidence that the grantee paid no consideration or that he agreed to take and hold 'the premises from the grantor. Hutchinson v. Tindall, 2 Green., ch. 357; Robson v. Harwell, 6 Ga., 589; Squire v. Harder, 1 Paige, 494; Rathbun v. Rathbun, 6 Barb., 98; Philbroke v. Delano, 29 Me., 410; Graves v. Graves, 9 Foster, 129; Leman v. Whetley, 4 Russell, 423. In Squire v. Harder the complainants sought to establish a resulting trust in land which they had conveyed with warranty, and were held to be estopped from showing that the grantee had. only a life interest in the purchase money and that upon her death it would have belonged to them.

Thus it will be seen that, while in North Carolina, the seventh section of the English Statute of Frauds not having been enacted here, parol trusts will be upheld in given instances in favor of third persons, as in Shelton v. Shelton, supra, or even creditors of the grantor, as in Shields v. Whitaker, 82 N. C., 516, such trusts will not be permitted or established here by reason- of cotemporaneous parol contracts and agreements between the parties when the same are in direct conflict with the expressed stipulations of the written deed and the entire purport of the instrument. In such case and to that extent the doctrine of parol trusts is subordinated to another well-recognized principle of law, that when parties have formally and explicitly expressed their entire contract, in writing, the same shall not be contradicted or changed by ccStemporaneous stipulations and agreements resting in parol. This position is well brought out and supported in the two decisions cited here: Dickenson v. Dickenson, supra, and Strong v. Glasgow, supra. In Dickenson v. Dickenson it was held: “Where an absolute deed is made, parol evidence is not admissible to prove that the deed was made under any special trust (for the grantor), and that a valuable consideration was not paid.” And, a few pages further on, in Strong v. Glasgow, a parol trust was engrafted or enforced where A. bought the property of B. at a sheriff’s sale and took a conveyance of same under agreement with B. to hold the prop-*231ertj for bim. “For,’’.said tbe Court, “tbe complainants, not being parties to tbe deed, were at liberty to establish tbe original contract.”

Tbe same position is very well expressed by Green, J., in Cain v. Cox, supra: “In tbis state of facts, wbat was tbe operation of tbis deed of 1854, whereby Rezin Cain conveyed tbis tract of land to bis sisters upon a parol trust for bis own use? In Troll v. Garter, 15 W. Va., 578, tbis Court decided: ‘If land be conveyed0 by a deed of bargain and sale for a merely nominal consideration, tbe courts of equity will not receive parol evidence to prove that tbe grantee agreed to bold tbe land for tbe grantor’s use, as tbe deed in such a case must have been made for tbe express purpose of divesting tbe grantor of bis title and vesting tbe same in tbe grantee. Such parol evidence, if admitted, would defeat tbe very purpose for wbieb tbe deed was made, and must be regarded as contradicting tbe deed, and tbe general rule of evidence requires in such case the rejection of parol evidence.’ ”

And in Adams’ Equity, 28, it is said: “Tbe declaration of trust by' tbe parties is not, independently of tbe Statute of Frauds, required to be made or evidenced in any particular way. And, therefore, previously to that statute, a trust, whether of real or personal property, might be declared either by deed, by writing not under seal or by word of mouth, subject, however, to the ordinary rule of law, that if an instrument in writing existed it could not be explained or contradicted by parol evidence.”

There are decisions to tbe contrary in other jurisdictions, and no doubt like expressions in some of our own cases. Thus, in Hall v. Livingston, 3 Del. Chan., 348, tbe chancellor, in a learned and elaborate opinion, contended that a parol trust could be set up against tbe grantee in a deed absolute on its face and without any allegation in tbe bill that tbe alleged trust was omitted by fraud or mistake. In tbis case it will be noted that in tbe first instance tbe trust declared was in favor of certain creditors of tbe grantor by lien and otherwise, and tbe decision might be reconciled on tbe principle that when there has been a severance of tbe legal and equitable estate by a valid *232agreement and a trust declared for a specific purpose the remainder of the interest not required for the purpose indicated usually results to the grantor. Bond v. Moore, 90 N. C., 239.

There are also decisions to the effect that when there is a contract or agreement to hold in trust for the grantor or other parties to the deed, and in direct contravention of the written provisions the refusal to carry out the oral agreement would of itself constitute such a fraud that a trust could be engrafted in the deed ex malificio. Some of the cases so hold in England, though the Statute of Frauds, forbidding oral trusts, prevails in that country. This position, however, is clearly untenable in-those .cases where the agreement itself cannot be established by competent testimony. The better-reonsidered authorities are to the effect that there can be no actionable fraud arising from breach of an agreement, without more, when the law forbids that the agreement should be set up or established. Wills v. Robertson, 121 Iowa, 381; note to Jachson v. Cleveland, supra, 90 Amer. Dec., 266.

And we are of opinion that the doctrine as it obtains with us, and as heretofore stated, making,' as it does, for the stability of titles which rest so largely on written instruments, and well supported by authority, should prevail, and, applied to the facts presented here, would forbid, that a trust should be declared or established in plaintiffs’ favor in case the deed from Eben-ezer to Sam Gaylord had been fully executed. "While we hold the opinion as indicated, and have expressed the views of the Court thereon at some length, because of the importance of the question, and of the suggestions that the claim of plaintiffs could in any event be sustained under the doctrine of parol trusts, we do not approve the ruling of the trial judge in dismissing the case as on judgment of nonsuit; for on the allegations and evidence we are further of opinion that an issue is presented as to whether the deed from Ebenezer to Sam Gaylord was. in fact ever delivered. It is a familiar principle that the question of the delivery of a deed or other written instrument is very largely dependent on the intent of the parties at the time and is not at all conclusively established by the manual or physical passing of the deed from the grantor to the grantee. As said by this Court *233in Waters v. Annuity Co., 144 N. C., 670, “Tbe fact tbat a policy in a given case bas been turned over to tbe insured is not. conclusive in tbe question of delivery. Tbis matter of delivery is very largely one of intent, and tbe physical act of turning' over a policy is open to explanation by parol evidence.” And tbe authorities are uniformly to tbe effect tbat, in order to be a valid delivery, tbe deed must pass from the possession and control of tbe grantor to tbat of tbe grantee, or to some one for tbe grantee’s use and benefit, with tbe intent at tbe time tbat 'the title should pass or tbe instrument become effective as a conveyance. And tbis requirement tbat tbe intent to pass tbe title shall exist at. tbe time, as applied to the facts presented here, is in no way affected by tbe doctrine very generally recognized, tbat a deed cannot be delivered to a grantee by way of escrow, for, before a written instrument can become an escrow, tbe same incident must exist, “tbat tbe same should pass from tbe control and possession of tbe grantor with tbe intent at tbe time tbat it should become effective on tbe happening of a given event.” Thus, in James v. Vanderhayden, 1 Paige, 385, it was held, tbat “When a bond, mortgage or deed was delivered to a .third person, to be kept by him during tbe pleasure of tbe parties, and subject to their further order, tbe papers in question were not escrows, and' tbat tbe third person was a mere depository.” Tbis doctrine of escrows, therefore, as stated, in no way affects tbe question, and in tbe case before us, if tbe instrument having been prepared and signed was then banded over by Eben-ezer to Sam Gaylord, not with tbe intent tbat tbe title should pass, but with tbe intent tbat Sam Gaylord should bold tbe same as a depository or subject to tbe control and call of Ebenezer, there was no delivery, and tbe title to tbe property descended to tbe plaintiffs, tbe children and heirs at law of Ebenezer, subject to tbe dower of bis widow.

Tbe views we have expressed will be found to accord with well-considered decisions in tbis and other jurisdictions; notably, Fortune v. Hunt, 149 N. C., 358; Tarlton v. Griggs, 131 N. C., 216; Roe v. Lovick, 43 N. C., 88; Wilson v. Wilson, 158 Ill., 567; Porter v. Woodhouse, 59 Conn., 568. In Tarlton v. Griggs, supra, Cook, J., delivering tbe opinion of tbe Court, *234said: “There must be an intention of tbe grantor to pass tbe deed from bis possession and beyond bis control, and be must actually do so witb tbe intent tbat it shall be taken by tbe grantee or by some one for him. Both tbe intent and act are ■necessary to a valid delivery. Whether such existed is a question of fact to be found by tbe jury. Floyd v. Taylor, 34 N. C., 47. But if tbe grantor did not intend to pass tbe deed beyond bis possession and control, so tbat be would have no right to recall it, and did not do so, then there would be no delivery in law, tbe facts of which must likewise be found by tbe jury.” And, further, in tbe same opinion, quoting witb approval from tbe opinion of Roe v. Lovick, supra: “But when tbe grantor parts witb tbe possession of tbe deed, showing an intention tbat it should not then become a deed, but delivered merely as a depository and subject to' tbe future control and disposition of tbe maker, then tbe delivery would be incomplete and no title would pass.”

And in Porter v. Woodhouse, supra, Andrews, C. J., said: “Tbe delivery of a deed implies a parting witb the possession and a surrender of authority over it by tbe grantor at tbe time, either absolutely or conditionally; absolutely, if tbe effect of tbe deed is to be immediate and tbe title to pass or tbe estate of tbe grantee to commence at once; but conditionally, if tbe operation of tbe deed is to be postponed or made dependent on tbe happening of some subsequent event. A conditional delivery is and can only be made by placing the deed in tbe bands of a third person, to be kept by him until tbe happening of tbe event upon tbe happening of which tbe deed is to be delivered over by tbe third person to tbe grantee. But it is an essential characteristic and an indispensable feature of its delivery, whether absolute or conditional, tbat there must be a parting witb tbe possession of tbe deed and witb all power and control over it by tbe grantor for tbe benefit of tbe grantee at the time of delivery. Prestman v. Baker, 30 Wis., 644. Tbe delivery of a deed is as essential to tbe passing of tbe title to tbe land described in it as is tbe signing of it or tbe acknowledgment. It is tbe final act, without which all other formalities are ineffectual. To constitute a delivery tbe grantor-must part witb tbe legal pos*235session of the deed and of all right to retain it. The present and future dominion over the deed must pass from the grantor.”

Nor is the objection available that there is evidence tending to show that it was the purpose and motive of Ebenezer in this transaction to put his property in such a position that his then wife could not successfully establish a claim upon the property in case of expected litigation between them. It is an undoubted principle that a court will not lend itself to establish a right growing out of a fraudulent transaction, a wholesome principle that has found expression in the maxim, ex malificio non oritur contractus; but this principle only applies when it becomes necessary to invoke the aid of the court to establish or assert the right arising by reason of such a transaction, and does not obtain when the right otherwise exists. See York v. Merritt, 80 N. C.,285. If there was no delivery of the deed in question, the title never passed from Ebenezer, and the plaintiffs, his children, whether as devisees or heirs at law, can assert their claim by reason of the title that was originally his. It may be well to note that while the testimony touching the transaction could not have been admitted to establish a' right or claim, as stated, when otherwise relevant it may still be received on the question of delivery.

From what has been said, it follows that the order of nonsuit will be set aside, and the 'cause will be submitted to the jury on some determinative issue involving the question as to whether the deed under which defendant claims was turned over to him with intent that the title should pass, or was the same to be held by defendant as a depository and subject to the control and call of Ebenezer, the grantor.



concurring: I concur in the decision of this case and the reasons upon which it is based. I think no other question is presented for decision, and that what is said in regard to the validity of the alleged parol trust is obiter. The question was not passed upon by the judge nor argued' in this Court. "Whether such a trust,' upon the evidence taken as true, can be declared by parol and enforced by the court is not free from doubt. I therefore think that we should not decide it and fore*236close tbe parties, unless fairly presented and an opportunity afforded them for argument. In Shelton v. Shelton, 58 N. C., 292, Chief Justice Pearson thus states the law, as held by this Court:

1. “At common law it was not necessary that a trust should be declared in any particular way; the• declaration could be made by deed or by mere word of mouth. In either case, if the trust could be proved, the chancellor would enforce its execution.

2. “In England, by the seventh section of the Statute of Frauds (29 Car. II), all declarations of trust are required to be ‘manifested and proved’ by some writing, signed by the party, etc.

3. “In this State there is no statute which requires the declaration of a trust to be in writing, and the matter stands as at common law. . '

4. “That the statute of 1819 [Revisal, sec. 976] does not include the declaration of a trust; it is not ‘a contract to sell or convey land.’ [Oases cited in Pell’s Revisal, 976.]

5. “That the rule which excludes parol evidence for the purpose of ‘explaining, altering or adding to a written instrument’ has no application,” because, as said by Pearson, C. J., “the declaration of a trust neither contradicts, explains nor adds to the deed.” Replying to the suggestion to the contrary, he says: “If this position be true, the English statute, in respect to the declaration of trusts, was uncalled for, and the doctrine of verbal declaration of trusts would not have obtained at common law. The truth is, neither the declaration nor the implication of a trust has ever been considered as affected by that rule of evidence. The deed has its full force and effect in passing the absolute title at law, and is not altered, added to or explained by the trust, which is an incident attached to it in equity as affecting the conscience of the party who holds the legal title.”

The language used by the learned Chief Justice has been cited in aUarge number of casés with approval.. Riggs v. Swann, 59 N. C., 118, in which he says: “The objection that the declaration of trust was not in writing, and .was therefore void, is not tenable. There is in this State no statute which requires the declaration of a trust, made at the time the legal, title passes *237to one wbo agrees to bold in trust, accompanying the transmission of the legal title, shall be in writing.” In Ferguson v. Haas, 64 N. C., 773, Mr. Justice Rodman makes a careful examination of the subject (Judge' Pearson being a member of the Court). The decision in Shelton’s case was attacked as “an innovation.” The attack was based upon the suggestion, which appears to have been advanced, that it was held in the opinion that a trust could be declared by a “mere oral declaration,” without any surrounding or sustaining circumstances. Judge Rodman says: “No such point was decided. * * * It is hard to conceive of a case which could be founded on words only, without some corroborating acts and circumstances.” He concludes that the Court “sees no occasion to alter any of the expressions in the case.” In Fry v. Ramseur, 66 N. C., 466, Pearson, C. J., reaffirms the doctrine in Shelton’s case. In Shields v. Whitaker, 82 N. C., 516, Smith, C. J., quotes with unqualified approval the opinion. Holmes v. Holmes, 86 N. C., 205; Smiley v. Pearce, 98 N. C., 185; Holden v. Strickland, 116 N. C., 185; Cobb v. Edwards, 117 N. C., 244; Bank v. Fries, 121 N. C., 241. In Sykes v. Boone, 132 N. C., 199, and Avery v. Stewart, 136 N. C., 426, Mr. Justice Walker reviews the authorities and cites Shelton’s case with approval. In Pittman v. Pittman, 107 N. C., 159, Shepherd, J., discusses the question, and holds that a written agreement, not under seal, made subsequent to the transmission of the title, without any consideration to support it, to hold in trust and convey to the grantor, would not be enforced in equity. He says: “To declare a trust in this case would contravene several other principles which have been firmly established by this Court, one of which is that no parol trust can be proved by subsequent declarations alone.” Citing Smiley v. Pearce, supra. The learned Justice, referring to the contention that a trust could be established in the manner attempted in that case, says: “If this be so, it would be difficult to escape what would seem to be the logical conclusion, that a voluntary trust may be declared by a simple oral declaration, unaccompanied by the transfer of the legal title.” Assuming that the testimony in this record is true, and eliminating any ■question .of the parties having any unlawful convey*238ing tbe land, we have this ease: Ebenezer Gaylord, being tbe owner of tbe land, and baying or' apprehending some trouble with bis wife, conveys it to bis brother, without any valuable or other consideration than that tbe grantee would bold it. in trust and convey to him. Ebenezer remains in possession until bis death. It is evident that tbe deed was not to be registered, because several witnesses say that when Ebenezer asked bis brother for it be assured him that it was burned or destroyed. Ebenezer’s wife dies; be marries a second time, and dies; bis brother marries bis widow and thereby gets into possession of tbe land and refuses to convey to bis deceased brother’s children. If tbe declaration of trust is not required to be in writing, and to prove it does not contradict, add to or alter tbe deed, with tbe surrounding and corroborating- circumstances, every one of which sustain tbe contention of tbe plaintiffs, I am unable to see, in tbe light of tbe decisions of this Court, bow we can refuse to grant relief: I seems that tbe language of Judge Pearson, in Clonninger v. Summit, 55 N. C., 513, is peculiarly applicable to defendant’s attitude. “This mean subterfuge, showing that the original purpose of tbe defendant was not to befriend bis neighbor (brother), but to trick him out of bis home, will not avail tbe defendant.”

I am unable to see bow tbe warranty in tbe deed, which is a personal covenant of quiet enjoyment, for tbe breach of which no damage could be recovered, as no purchase money was paid, can estop tbe plaintiffs. Tbe declaration of trust is not inconsistent with or contradictory of any recital or assertion in the deed, which has full operation at law. Decisions of other courts, wherein tbe seventh section of tbe Statute of Frauds has been enacted, are not helpful to us. It will be noted that many of those cited in tbe opinion are discussions of implied or resulting trusts, because no consideration was paid. It is conceded that, by an express provision (eighth section).of tbe statute, implied and resulting trusts are excepted. Tbe effort to bring cases where no consideration is paid by tbe grantee within the saving provisions of that section has given rise to much discussion. Tbe plaintiffs’ case is not affected by it. They rely upon an express trust, affected by tbe seventh section. As said by Judge *239 Pearson, if an express trust comes within the parol-evidence rule, there was no occasion for the adoption of the seventh section of the statute. It is not easy to perceive how the introduction of parol evidence to show that at the time of the delivery of a deed a declaration of trust for the grantor was made and accepted by both parties contradicts the deed, whereas, if made under the same circumstances in favor of a third person, it does not do so. In both cases the land is conveyed to the grantor. The additional words, “to his only use and behoof,” adds nothing to the usual form of the habendum. Certainly they do not prevent the engrafting of a parol trust for a third person. I find that in Murphy v. Hubert, 7 Pa. St., 420, Gibson, C. J., held that as the seventh section of the .Statute of Frauds had not been enacted in that State, the Court was not authorized to reject parol evidence of the declaration of a trust made at the time the title passed. He asks, “Why was- the seventh section, with others, omitted? Certainly, to prevent its provisions from becoming the law of the land. And how can we make them the law of the land in the face of such a demonstration of legislative intent?”

Without further discussing the subject, I am of the opinion that a question of so much importance, and concededly not free from difficulty, should not be decided until it is fairly presented as the decisive question in the case. I have no disposition to extend the doctrine of parol trusts, as held by our predecessors. I think that the opinion restricts it in narrower limits than has heretofore been done, and prefer to leave the question as I find it until, after full argument and mature reflection, it becomes our duty to decide it. I have not overlooked the decision in Bonham v. Graig, 80 N. C., 224, and several other cases, which appear to conflict with Shelton’s case. It would seem that the Court regarded the parol agreement in those cases as attempts to attach a condition rather than declare a trust. The distinction is clearly pointed out in Shelton v. Shelton. I do not care to discuss the question of the purpose for which the deed was made, as affecting.the validity of the trust, or, rather, the right of the plaintiffs to come into a court of conscience.

Walker, J., concurred in this opinion.