Lawrence v. Eller, 169 N.C. 211 (1915)

May 19, 1915 · Supreme Court of North Carolina

169 N.C. 211

H. L. LAWRENCE and Wife v. B. F. ELLER and Wife.

(Filed 19 May, 1915.)

1. Landlord and Tenant — Tenant’s Possession — Action of Title.

Where one has entered into possession of lands as tenant of another under an agreement of lease he may not maintain an action involving title, while in possession of the premises, against his lessor during the continuance of the lease, without first having surrendered the possession which he has acquired under the terms of his agreement.

2. Same — Exceptions—Deeds and Conveyances — Estoppel.

The restricted instances making exception to the general rule that a tenant may not sue for title of the leased premises which he has acquired under his contract of lease apply to cases where, after the renting, the title to the landlord has terminated or has been transferred either to a third person or the tenant himself; and in courts administering principles of equity the estoppel is not recognized when the tenant has been misled into recognition of his lessor’s title by mistake or fraud, and under circumstances which would induce a court of equity to hold the landlord a trustee for the tenant, or other exceptions of a restrictive nature which do not apply to the consideration of this case.

3. Landlord and Tenant — Tenant’s Possession — Action of Title.

If the principles of estoppel of a tenant in possession under and during the continuance of his lease do not apply to his action involving the issue of title alone, serrible the exception to the general rule does extend to those instances where the possession and the rights growing out of or incident to it are presented or in any way affected.

4. Landlord and Tenant — Tenant’s Possession — Action of Title — Cloud on Title — Gravamen of Action — Incidental Matters.

In this action by the tenant in possession of lands under his lease against his landlord under claim of acquisition of a superior title it is Held, that the gravamen of the action is to have the plaintiff declared the true owner, and that the plaintiff’s demand to have defendant’s deed removed as a cloud upon his title is only an incident and evidential, and does not affect the matter.

Appeal by plaintiff from Webb, J., at Spring Term, 1914, of Avery.

Civil action to establish ownership and right of possession of a certain tract of land lying in Avery County.

It was admitted in the pleadings that defendants, B. F. Eller and wife, or B. F. Eller, as agent of his wife, had rented the tract of land in controversy to plaintiff for the year 1912 at the contract price of $25; that the lessee had entered into possession and occupation of the property under and by virtue of the contract and had continued such possession since that time; that in December, 1912, plaintiff had acquired a deed for the property from ~W. P. Eaton and wife, the original owners, and in January, 1913, had instituted the present action against the lessors, claiming to be the true owners under said deed and without having surrendered or made any offer to surrender possession acquired by them under and by virtue of the lease.

It was further alleged in tbe pleadings that W. P. Eaton and wife bad previously, in 1906, contracted to sell tbe property to one D. C. Eller, wbo bad entered under tbe contract of purchase, and, after committing much spoil and injury to tbe property, bad abandoned bis contract to tbe original owners, and plaintiff bad then acquired tbe title by purchase and deed, and were tbe true owners of tbe property.

Plaintiff further alleged that defendants, by some fraudulent arrangement or contrivance with D. C. Eller, bad obtained possession of tbe property, to which they bad no right whatever, and while bolding under such claim bad made tbe lease under which plaintiff entered.

They alleged further, that while defendant occupied tbe property under their pretended claim, they bad procured a deed to be made them by tbe sheriff of Watauga County, purporting to convey to- them tbe right of D. 0. Eller in tbe property, and that this was their only claim of title; and plaintiffs thereupon demand judgment that B. F. Eller and wife be declared tbe tenants of plaintiff, and that this pretended deed of tbe sheriff be declared fraudulent and void as constituting a cloud on their title.

Defendants answer, denying tbe allegations in impeachment of their title, and setting forth, also, that D. C. Eller bought tbe land originally from Eaton and wife for $1,200 to $1,300, and took a bond for title to convey same, which was duly registered in Watauga County, where tbe land was then situated; that some money was paid down and notes executed for tbe remainder, towit, two notes for $425 each and one for $200; that D. C. Eller paid tbe $200 note and one of tbe notes for $425, and, afterwards, in 1908, defendants bought tbe land from D. C. Eller, paying in full for bis interest, and afterwards acquired tbe other note for $425 by purchasing tbe same for full value from persons to whom it bad been assigned by Eaton and wife; that defendant neglected to take a written assignment from D. C. Eller for bis interest in tbe property, but, being a man of no education, be was misled and deceived in reference thereto by D. C. Eller, but that present defendants bad acquired tbe title to said land or tbe right thereto in tbe manner specified, and, being in possession, claiming as owners under their purchase, as stated, they bad rented to plaintiff for 1912, and plaintiff, being fully aware of all tbe facts and that tbe land bad been fully paid for, bad entered into a pretended agreement with Eaton and wife to purchase tbe land and taken a deed therefor, to be paid for in case recovery could be bad against these defendants, and ask judgment that defendants be declared tbe owners of tbe property and that tbe money paid therefor be declared a lien thereon, etc., and for general relief.

Tbe court having intimated an opinion that plaintiffs could not maintain tbe present action unless and until possession bad been restored to defendants, in deference to such intimation plaintiffs submitted to a non-suit and appealed.

T. A. Love, J. W. Ragland for plaintiff.

L. D. Love for defendants.

Hoke, J.,

after stating the case: It is recognized as the general rule that a tenant is not allowed to controvert the title of his landlord or set up rights adverse to such title without having first surrendered the possession acquired under and by virtue of the agreement between them.

The position does not usually obtain where, after the renting, the title of the landlord has terminated or has been transferred either to a third person or the tenant himself, for, under the doctrine as it now prevails, the loyalty required is to the title, not to the person of the landlord, and in courts administering principles of equity the estoppel is not recognized when the tenant has been misled into a recognition of his lessor’s title by mistake or fraud and under circumstances which would induce a court of equity to hold the landlord a trustee for the tenant, and there are other exceptions of a restricted nature.

The general rule, however, is as stated, and, while varying at times in its application, has been everywhere recognized as sound in principle and has always been very rigidly enforced in this jurisdiction. Campbell v. Everhardt, 139 N. C., pp. 502-514; Pool v. Lamb, 128 N. C., p. 1; Springs v. Schenck, 99 N. C., 552; Davis v. Davis, 83 N. C., 71; Farmer v. Pickens, same volume, 550; Wilson v. James, 19 N. C., 349; Abbott & Foster v. Cromartie, 12 N. C., 292; Callendar v. Sherman, 21 N. C., 711; Town v. Butterfield, 91 Mass., 105; Brown v. Keller, 32 Ill., 157; Davis v. Williams, 130 Ala., 530; Rodgers v. Boynton, 57 Ala., 501; Ward v. Ryan, J. R., vol. 10, 76-77, p. 17; Peyton v. Stith, 5 Peters, 485; 2 McAdam Landlord and Tenant, see. 421; 18 A. and E. (2 ed.), p. 414; 24 Cyc., 946.

In Davis’s case, supra, Chief Justice Smith said: “It is well settled doctrine that one who, as tenant, gains possession of the land of another cannot resist an action for its recovery, brought after the termination of the lease, by showing a superior title in another or in himself, acquired before or after the contract. The obligation to surrender becomes absolute and indispensable. ‘Honesty forbids,’ says Ruffin, C. J., ‘that he should obtain possession with that view, or, after getting it, thus use it.’ Smart v. Smith, 2 Dev., 258. ‘Neither tenant nor any one claiming under him,’ remarks Daniel, J., ‘can controvert the landlord’s title. He cannot put another person in possession, but must deliver up the premises to his own landlord.’ Callendar v. Sherman, 5 Ired., 711. ‘If he entered as tenant, or, after entry, had become such,’ is the language of Rodman, J., ‘he was estopped from asserting his title until, he had restored tbe possession to tbe plaintiff.’ Heyer v. Beatty, 76 N. C., 292. Even a homestead right cannot be asserted in opposition to tbe recovery. Abbott v. Cromartie, 12 N. C., 292. Tbe rule does not preclude tbe tenant from showing an equitable title in himself on such circumstances as under our former system would call for tbe interposition of a court of equity for bis relief, and which relief may now be obtained in tbe action, as is held in Turner v. Lowe, 66 N. C., 413. Yet tbe force of tbe general proposition remains unimpaired, that where tbe simple relation of lessor or lessee exists without other complications, tbe latter cannot contest tbe title of tbe former. Forsythe v. Bullock, 74 N. C., 135. Tbe obligation to restore a possession thus obtained, before any inquiry into tbe title is permitted, although springing from tbe contract, rests upon tbe foundation of good faith and honest dealing among men.”

In Farmer v. Pickens, same volume, Dillard, J., tersely states tbe position: “It is settled that a person accepting a lease from another is estopped during tbe continuance of tbe lease, and afterwards, until be surrenders the possession to the landlord, to dispute bis title, being a rule founded on a principle of honesty which does not allow possession to be retained in violation of that faith on which it was obtained or continued.”

In Springs v. Schenck, supra, tbe Court held: “A tenant cannot be beard to deny tbe title of bis landlord, nor can be rid himself of this relation, without a complete surrender of tbe possession of tbe land.”

In Towne’s case, supra: “A tenant at will is estopped from denying his landlord’s title without surrender of tbe leased premises or eviction by title paramount or its equivalent.”

In Brown v. Keller: “A tenant must surrender the premises before asserting rights adverse to bis landlord which he acquired after renting tbe premises.”

And in Davis v. Williams:

“2. A tenant is estopped to dispute tbe title of his landlord, unless bis landlord’s title has expired or been extinguished, either' by operation of law or bis own act, after the creation of tbe tenancy (p. 58).

“3. It is only where there is a change in the condition of the landlord’s title for the worse, after a tenant enters into bis contract, in the absence of fraud or mistake of fact, that be is permitted to show tbe change in tbe condition of tbe title (p. 58).

“4. A tenant must first surrender tbe premises to his landlord before assuming an attitude of hostility to tbe title or claim of title of tbe latter (p. 58).

“5. An estoppel will be enforced in a court of equity as well as in a court of law (p. 59).”

A correct application of tbe principle declared and upheld in these cases are in full support of bis Honor’s ruling, it appearing, from a perusal of tbe pleadings, that, without any change having taken place in the title of the lessor since the renting, the plaintiff, after having become defendant’s tenant, and during his tenancy, has undertaken to acquire what he considers a superior title to that of his landlord, and, while maintaining the possession acquired under and by virtue of his lease and without surrender, he institutes the present action to have himself declared the true owner, and that defendants are in fact and truth his tenants.

It has been said that the estoppel referred to does not prevail in actions involving an issue as to title, but if such a limitation on the general rule prevails in this jurisdiction, it applies only to actions involving strictly the issue as to title, and does not extend to those where the possession and the right growing out of or incident to it are presented or in any way affected. Peyton v. Stith, 5 Peters, 485; Bigelow on Estoppel (6 Ed.), p. 585; 18 A. and E. (2 Ed.), p. 419.

"While the action seeks also to have a deed, referred to in the pleadings, declared to be a cloud on plaintiff’s title, this is only an incident and evidential. The gravamen of the action is to have plaintiff declared the true owner and that defendants are his tenants, and, under the authorities cited, such an action cannot be maintained by plaintiff unless and until he first surrenders the possession to the person from whom he rented.

There is no error, and the judgment of his Honor is

Affirmed.