Crawford v. Allen, 189 N.C. 434 (1925)

April 15, 1925 · Supreme Court of North Carolina
189 N.C. 434

JOHN W. CRAWFORD, Executor and Trustee under the Will of J. H. CRAWFORD, Deceased, v. R. G. ALLEN, JAMES M. ALLEN, and W. H. ALLEN, and CAPITAL REALTY COMPANY v. JOHN W. CRAWFORD, Executor and Trustee under the Will of J. H. CRAWFORD, Deceased, and LOUIS SAMUELS and ALEXANDER LEVY.

(Filed 15 April, 1925.)

1. Contracts — Bargain and. Sale — Covenants—Breach..

Where the owner of lands, for a valid consideration, enters into an unconditional contract for the sale thereof, at a fixed price, and the other-party unconditionally contracts to purchase the same at a future time, it is -an executory contract of sale and purchase, whereunder each of the parties acquire rights and equities for performance upon complying with its terms, and where the purchaser agrees to pay a certain per cent of the purchase money in lieu of interest, and the taxes and insurance, these considerations are to he regarded as covenants, and not conditions the breach of which will work a forfeiture of his right to specific performance.

2. Same — Equity—Liquidated Damages.

Where an executory contract for the sale and purchase of land expressly provides for the purchaser’s payment of a certain amount of liquidated damages in the event of his failure to perform its terms, and it appears upon the breach of the contract that the seller has not been damaged, no liquidated damages are recoverable; and where the purchaser has received the specified amount of liquidated damages, the courts of equity will apply such damages to the consideration for the transaction provided for "in the contract.

3. Same — Forfeitures. .

Courts of equity do not favor forfeitures; and where a contract of sale and purchase of lands provides for the payment of liquidated damages by the purchaser in breach of its terms, this provision will not be enforced where there has been no injury and no loss.

4. Same — Time of .the Essence.

A xn-ovision of a contract for the sale and purchase of land that “time is of the essence of the contract” will be disregarded in equity when it is apparent, under the application of equitable princixiles to the case in hand, that it was not of the essence thereof.

5. Same — Payment—Accounting.

Equity will decree specific performance in favor of a purchaser under a contract for the sale and xrarchase of lands who has failed to perform certain covenants therein required of him as to payments of certain moneys and the balance of the purchase price, and reasonably extend the time for payment when at the institution of the vendor’s suit for damages he is ready, able and willing to pay the amounts chargeable against him; and upon a disagreement as to this amount, an accounting between the parties may be taken.

*4356. Lis Pendens — Notice—Title to Lands — Registration.

When the title of the owner of leased lands is in litigation at the time of making the lease, in the county wherein the lands lie, it is notice to the lessees of the title adversely claimed, and the question of Us pendens of proceedings in another county affecting the title does not apply.

7. Appeal and Error — Record—Courts—Jurisdiction.

The jurisdiction of the court in the determination of an action does not arise on appeal when the record is silent as to the facts whereon the motion is based, and the matter is called to the attention of the Supreme Court, by demurrer, the first time.

Appeal by John W. Crawford, executor and trustee, and Louis Sam-uels, from judgment rendered by Horton, J., at Fall Term, 1924, of Waice.

The first action, entitled as above, was begun in tbe Superior Court of Wake County, on 1 February, 1924. Plaintiff alleged that defendant, R. G. Allen, had breached a contract for the purchase and sale of a lot of land, situate on Fayetteville Street, in the city of Raleigh, entered into by plaintiff and said defendant, in writing, dated 13 January, 1920, and extended from time to time, by mutual agreements, to 1 January, 1924, said extension agreements being in writing, signed by the parties, and setting forth the terms and conditions upon which same were entered into; and that plaintiff had been damaged by breach of said contract by defendant in the sum of $6,279.20. Plaintiff demanded judgment that he recover of defendant, R. G. Allen, and his codefend-ants, sureties on his bond, as alleged in the complaint, the said sum as damages.

Defendants, in their answer, filed on 8 March, 1924, admitted the execution of the contract and of the extension agreements, and also of the bond, as alleged. Defendants allege that said contract is still in full force and effect; that R. G. Allen had paid $2,000 on the purchase price of said lot, leaving a balance due, after said payments, of $43,000; that during the existence of said contract, plaintiff and said defendant had had dealings with each other, with respect to the lot, the subject-matter of said contract, as provided in the extension agreements, involving rents and income arising therefrom, and expenditures for taxes, insurance and repairs made thereon, and that defendants were ready, willing and able to pay the balance due on the purchase price for said lot when same had been ascertained and determined by an accounting between the parties. Defendants prayed that plaintiff be required to execute deed conveying to R. G. Allen, or his assigns, the said lot upon payment by defendants to plaintiff of the balance due on the purchase money.

The second action, entitled as above, was also begun in the Superior Court of Wake County, on 12 September, 1924. The plaintiff, Capital *436Eealty Company, alleged tbat on 28 June, 1923, E. G. Allen bad assigned to plaintiff, for a valuable consideration, all bis interest in tbe contract between tbe said E. G. Allen and defendant, John "W". Crawford, executor and trustee under tbe will of J. H. Crawford, deceased, relative to said lot, and bad conveyed to plaintiff all bis right, title and interest in and to said lot by virtue of said contract, and tbat said assignment and conveyance bad been duly registered on said date; tbat said contract was in full force and effect, and tbat plaintiff was ready, willing and able to pay tbe balance due on tbe purchase price for said lot in accordance with said contract; tbat in June, 1924, tbe said Crawford undertook to lease tbe said lot for a term of ten years to bis codefendants, Louis Samuels and Alexander Levy; tbat said Samuels and Levy bad notice of tbe contract under which plaintiff claimed and took tbe said lease, subject to tbe rights of jjlaintiff in and to said lot; tbat said Samuels and Levy were about tt» make certain repairs to and alterations in tbe building on tbe said lot, which would materially affect tbe value thereof. Plaintiff prayed for an order enjoining and restraining'defendants from making any repairs to or alterations in said building.

Defendants in their answers deny tbat plaintiff has any right, title or interest in or to said lot, alleging tbat E. G. Allen bad, prior to the date of tbe lease, forfeited all rights under tbe contract by breaches of tbe same, and tbat plaintiff acquired no rights with respect to tbe said lot by tbe alleged assignment or conveyance to it from E. G. Allen. Defendants Samuels and Levy deny tbat they bad any notice, actual or constructive, of any claim of plaintiff to said lot, and both defendants pray that the prayer of plaintiff be denied, and tbat said lease be declared in all respects valid and binding.

By consent of all parties, these two actions were consolidated for tbe purpose of tbe bearing. A trial by jury was duly waived, and tbe judge, by consent, found tbe facts from tbe evidence offered at tbe bearing. Tbe findings of fact and conclusions of law are set out in tbe record. Tbe judge, upon an accounting between John W. Crawford, executor and trustee, and E. G. Allen, finds tbat tbe balance due on the purchase price for said lot, on 1 January, 1924, is $50,881.24, and orders, adjudges and decrees (1) tbat Capital Eealty Company shall, on or before the date fixed in tbe decree, pay into tbe office of tbe clerk of tbe Superior Court of "Wake County tbe sum of $50,881.24, with interest from 1 January, 1924, less tbe sum of $333.33 for each and every month from and including January, 1924, until said sum of money is paid, with interest on said monthly payments from tbe last day of each month; (2) tbat upon payment of said sum of money into tbe said office, John W. Crawford, executor and trustee, shall execute a *437good and sufficient deed, conveying said lot in fee simple to Capital Realty Company or its assigns; (3) that the lease from John W. Crawford, executor and trustee, to Louis Samuels and Alexander Levy be and the same is canceled as against the rights of Capital Realty Company; (4) that John W. Crawford, executor and trustee, and said Samuels and Levy, shall deliver possession of said lot to Capital Realty Company or its assigns upon payment of said sum of money into the clerk’s office, as required in the judgment and decree.

John W. Crawford, executor and trustee, and Louis Samuels except to said judgment and decree, and appealed therefrom to the Supreme Court, assigning errors.

Robert C. Strong, R. N. Simms, W. Tolman Shaw, and. Manning & Harming for John W. Crawford.

Pou & Pou and J. L. Emanuel for Louis Samuels.

W. E. Yarborough, J. W. Bailey, and J. Crawford Biggs for Capital Realty Company and R. C. Allen, James M. Allen, and W. E. Allen.

Connor, J.

The questions presented on this appeal by John W. Crawford, executor and trustee, as stated by his counsel in the brief filed in this Court, in his behalf, are:

1. Whether the contract between Crawford, executor and trustee, and R. G. Allen is sufficient to entitle R. G. Allen, or his assigns to the equitable remedy of specific performance.
2. If so, whether by the terms of the said contract, all rights thereunder, in( or to the said contract or the lot, the subject-matter thereof, _ have been forfeited by R. G. Allen by his failure to' perform and comply with the said terms.
3. If so, whether Crawford, executor and trustee, upon the facts found by the judge, is entitled to judgment against R. G. Allen and the sureties on his bond for damages, as alleged by him.

These questions are fairly presented by the exceptions and assignments of error, appearing in the statement of the case on appeal and discussed in appellant’s brief. Answers to these questions will be determinative of this appeal.

The judge finds that “the contract of sale and purchase of the Crawford store in controversy was entered into between R. G. Allen and John W. Crawford, executor and trustee, on 13 January, 1920, and said contract was duly recorded in the office of the register of deeds of Wake County; that the date for payment of the balance of the purchase money was extended from time to time to 1 January, 1924, as per the agreements attached to the pleadings, the original contract being otherwise amended as appears in said agreements.

*438The evidence upon which theSe findings of fact are made is the contract and agreements, all of which are in writing and signed by both Crawford, executor and trustee, and R. G. Allen. It is admitted in the pleadings that-John W. Crawford, executor and trustee, had authority to enter into the various contracts with the defendant. The original contract dated 13 January, 1920, recites that the agreement is made “subject to the order of the court to be hereafter obtained.” It is provided in the contract dated 6 July, 1920, that “a controversy without action, under our statutes, shall be submitted to the Superior Court of Wake County, to adjudicate the title to a certain lot.of land in Raleigh, North Carolina, between Fayetteville and Salisbury streets, belonging to the estate of John H. Crawford, deceased.” It is alleged and admitted that the title of John W. Crawford, executor and trustee, has been favorably adjudicated. Thus the only condition precedent to the full, binding effect of the said contract has been complied with, and the parties thereto are vested with all the rights and subject to all the obligations set out therein. The contract is no longer conditional; the mutual rights and obligations of the parties are to be determined by the contract, which is in writing, signed by them. The contract was in full force and effect on 1 January, 1924, unless R. G. Allen had forfeited his rights thereunder by failure to perform and comply with the terms thereof.

Crawford, executor and trustee, contends that the contracts are not sufficient to entitle R. G. Allen or his assigns to a decree of specific performance, for that there is a want of mutuality of obligation in said contracts. This contention cannot be sustained. Crawford, executor and trustee, is by the express terms of the contract, under obligation to sell and convey, and Allen to purchase and pay for the lot. Neither has an option, each is entitled under the contract to rights, which are not dependent upon any further act -of the other; these rights are enforceable by either as against the other. The contracts are bilateral, and not unilateral. It is a contract of purchase and sale. As said by Justice Stacy, of the contract involved in Howell v. Pate, 181 N. C., 117: “The agreement contains the necessary elements of an executory contract, to wit, mutuality of obligation and remedy.” Davis v. Martin, 146 N. C., 281. Pollock v. Brookover, 6 L. R. A. (N. S.), 403; Rucker v. Sanders, 182 N. C., 607; See Solomon v. Sewerage Co., 142 N. C., 439. Bispham’s Equity, p. 377.

Nor can the contention that the contract is not enforceable by a decree of specific performance, because it provides for the payment, upon its breach by R. G. Allen, vendee, to Crawford, executor and trustee, vendor, if liquidated damages, be sustained. In the contract dated 13 January, 1920, Crawford, executor and trustee, acknowl*439edges tbe receipt from R. G. Allen of five bnndred, “to bind tbe trade.” It is therein provided that in tbe event Allen refuses to pay tbe purchase price upon tbe conveyance of title by Crawford, “tbe said sum of five hundred ■ dollars, given to bind tbe trade, is to be regarded as liquidated damages to cover tbe expenses that Crawford may have been put to, but that upon said Alien’s performance of bis part of tbe contract, tbe said five hundred dollars is to be allowed as a credit on tbe purchase price.” In tbe contract, dated 6 July, 1920, it is agreed that upon default by Allen in tbe payment of tbe xourebase price, “then said Allen shall pay tbe said Crawford, executor and trustee, tbe sum of one thousand five hundred dollars as liquidated damages for tbe breach of bis contract.” Upon tbe execution of this contract Allen deposited with a bank designated by Crawford, tbe sum of one thousand five hundred dollars, to be held in trust for said purpose. In tbe contract dated 1 April, 1921, providing, primarily, for an extension of tbe time for payment of tbe purchase price by Allen, it is recited that tbe balance due on tbe purchase price is $43,000, “tbe said sum being tbe original purchase price ($45,000) less tbe sum of two thousand dollars which Allen has paid thereon, which includes fifteen hundred dollars paid by Allen just before tbe expiration of this contract. In tbe last agreement, dated 16 December, 1922, extending time of payment to 1 January, 1924, tbe balance due on tbe purchase price is stated as $43,000, it being agreed that tbe deposit of $1,500 “is to be continued to be held in trust as liquidated damages.” In their brief, attorneys for Crawford concede that these sums should be deducted from tbe amount which be demands as damages.

"Whether, notwithstanding tbe reference, in tbe contracts, to tbe five hundred and tbe fifteen hundred dollars as liquidated damages, in view of tbe application of these sums by tbe parties to tbe contract as payments on tbe purchase price, a court, exercising equitable jurisdiction, considering tbe substance and not tbe form, will regard them as deposits to cover liquidated damages, need not now be determined. A court of equity, which does not favor forfeitures, and will not enforce penalties, but seeks to do justice in accordance with tbe rights of both parties, as determined by an enlightened conscience, will not be swift to sustain an undertaking to pay liquidated damages, where there has been no injury and no loss. Appellant’s insistence that be ought not to be decreed to convey this property to Allen or bis assigns, because it has greatly enhanced in value during tbe pendency of tbe contract relations of tbe parties, is hardly consistent with bis demand for liquidated damages, because Allen failed to pay him tbe purchase price agreed upon. If be could sustain bis contentions in this action, and thus be relieved of bis obligations under tbe contract, be would suffer no loss, *440for be now contends tbat tbe property wbicb be sold in 1920, for $45,000 is worth $75,000 or more.

In Gordon v. Brown, 39 N. C., 399, Ruffin, C. J., says: “It is true, as tbe defendant says, tbe penalty was tbe law of their contract, limiting tbe sum which could have been recovered from tbe defendant in an action of debt. But equity disregards penalties. If tbe penalty here bad been ten times as much, tbe defendant would have then thought it reasonable and equitable, tbat be should be relieved from it by performance of tbe act, upon tbe nonperformance of wbicb tbe penalty accrued by strict law. So tbe other side is not restricted to bis legal remedy by an action on tbe penalty, but may claim an execution of tbe contract, as it is understood by tbe Court; tbat is, as a stipulation, without reference to tbe penalty, to do tbe several things stated in tbe condition.” In tbat case tbe value of tbe property for tbe recovery of wbicb tbe action was brought was much larger than tbe penal sum of tbe bond. Tbe bond was for tbe return of tbe property, and the obligor contended tbat, it being found tbat be could not return tbe property, tbe recovery by tbe obligee was limited to tbe amount of tbe bond; tbe Court held tbat tbe obligation of tbe defendant was to return tbe property, and not primarily to pay tbe penalty of tbe bond. There tbe obligor was required to perform bis contract by payment of tbe full value of tbe property and was not relieved by bis obligation to do so by payment of tbe penal sum of bis bond. Here, tbe vendor is entitled only to bis actual damages, wbicb could be readily ascertained, in accordance with a well established principle of law, fixing tbe measure of bis damages, notwithstanding a provision in tbe contract for payment of a sum of money, arbitrarily fixed, as liquidated damages. Even if tbe provision in tbe contract, relative to liquidated damages is enforceable, it does not affect tbe equity of R. G. Allen or bis assigns to specific performance. 36 Cyc., 571. It does not destroy the mutuality of obligation, for R. G. Allen would not be relieved of bis primary obligation to purchase and upon conveyance to him of tbe lot, to pay tbe purchase price, by tbe payment of tbe sums, called liquidated damages. Nor does tbe provision affect Allen’s right to enforcement of tbe obligation of Crawford, executor and trustee. See Fry’s Specific Performance, sec. 142 et seq.

A full and careful consideration of tbe various contracts and agreements between tbe parties does not disclose tbat “time was of tbe essence of tbe contract,” although there is a recital to tbat effect in tbe contract dated 6 July, 1920. From and after tbat day, it is manifest tbat neither of tbe parties so regarded it. Allen assumed possession of tbe property on 6 July, 1920, and thereafter of tbe collection of tbe rents and tbe payment of all expenses of maintaining it. He indemni*441fied Crawford, executor and trustee, from any loss that might be caused by fluctuations in the price of Liberty bonds, in which Crawford intended to invest the proceeds of the sale of the property, and this he is required to do by the judgment and decree of his Honor. He guaranteed to Crawford a stipulated monthly rental for the property. On 1 April, 1921, he renewed his obligation with respect to the Liberty bonds, and “in lieu of interest and also to compensate Crawford, executor and trustee, for trouble and expense,” he agreed to pay a sum equaling 10 per cent per annum of $43,000, in equal monthly installments, and that he is required to do by the judgment and decree. On 7 November, 1921, he gave bond, in the sum of $10,000, conditioned for the performance by him of the terms and stipulations provided in the former agreements or any agreements for extension that might thereafter be made from time to time.

“It is the general doctrine in equity, in considering the rights of vendor and vendee under a contract of bargain and sale, that time is not of the essence of the contract. In cases in which it is seen really to be essential — that is, where it must have been understood by the parties at the time of the contract — -that events would probably happen in which interest would not be a compensation because the title to the property or its value might be greatly affected by those events, and one of them holds back until the contemplated contingency happened, that person cannot apply to enforce the contract which he has violated, and violated in bad faith, and as to a main ingredient of the bargain.” Ruffin, C. J., in Falls v. Carpenter, 21 N. C., p. 278. Even if time was deemed by the parties as a material element in the contract, on 6 July, 1920, the parties, by their subsequent conduct, could waive it. The extension of time for performance of the contract by Allen results in Crawford, executor and trustee, receiving 10 per centum per annum of the purchase price, rather than the small returns from Liberty bonds while he was guaranteed against loss by fluctuations in the price of the bonds.

The relation of Crawford, executor and trustee, and R. G. Allen, with respect to this lot of land, was that of vendor and vendee. It has been repeatedly held that this relation is substantially that subsisting between a mortgagor and mortgagee, and that it is governed, with respect to their mutual and reciprocal rights and duties, by the same general rules. Ellis v. Hussey, 66 N. C., 501; Jones v. Boyd, 80 N. C., 258; Killebrew v. Hines, 104 N. C., 182; Allen v. Taylor, 96 N. C., 37; Bank v. Pearson, 119 N. C., 494.

We must therefore hold that on 1 January, 1924, the contract on its face was valid and binding, and that each party thereto was entitled to have the same enforced by a decree of specific performance, unless by some act of default he had forfeited his rights to this equitable remedy.

*442“It is established in this jurisdiction that, in the absence o£ fraud, mistake, undue influence, or oppression, a binding contract to convey land will be specifically enforced by the court.” Flowe v. Hartwick, 167 N. C., 448; Bispham’s Eq., sec. 364. Equitable defenses must be specifically pleaded; otherwise, they cannot be proved. Goodman v. Robbins, 180 N. C., 239; Harper v. Battle, 180 N. C., 375. In the last case cited Chief Justice Hoke says that when the right to specific performance is properly established, it must be enforced as the parties have made it, or as far as practicable under existent circumstances.

Upon the evidence, and the facts found therefrom, the court was of the opinion, and held, “that the contract had not been forfeited or abandoned in 1923, but that it was in full force on 1 January, 1924, and that the failure of the Capital Realty Company (assignee of R. G. Allen) to tender the balance of the purchase money on 1 January, 1924, did not work a forfeiture of the contract of sale, in view of the claim of Crawford, executor and trustee, on 1 January, 1924, of the prior forfeiture of said contract, and his denial of said contract and the claim by him of an excessive amount (even if the contract was in force) and the failure of Crawford to tender a deed.”

The judge found as a fact that the Capital Realty Company (assignee of R. G. Allen) is ready, able and willing to pay the balance of the purchase money.

The failure of R. G. Allen, in accordance with his agreement, to pay the monthly installments of $358.33 from 1 March, 1923, to 1 January, 1924, making a total, with interest, of $3,681.96, as one of the considerations for the extension granted on 1 April, 1921, did not work a forfeiture of his rights under the contract, nor make the extension agreement void. His Honor deducted the total of the rents collected by Crawford during that period, and included the balance, to wit, $1,412.35, in the amount which he requires the Capital Realty Company (assignee of R. G. Allen) to pay. His Honor also includes in said amount all sums paid by Crawford during that period for taxes, insurance and repairs on the property, amounting to $1,392.74.

The judge further found that the difference between the price of Liberty bonds which could have been bought by Crawford, executor and trustee, on 6 July, 1920, and on 1 January, 1924/is $5,076.15, and this amount he also requires Capital Realty Company to pay.

The holding of his Honor upon this phase of the case, and the inclusion of these items in the amount which he requires the vendee to pay, is fully supported by well-established principles of equity, and meets the requirements of justice.

“The doctrine is fundamental that either of the parties seeking a specific performance against the other must show, as a condition prece*443dent to bis obtaining tbe remedy tbat be bas done, or offered to do, or is then ready and willing to do, all tbe essential and material acts required of bim by tbe agreement at tbe time of commencing tbe suit, and also tbat be is ready and willing to do all sucb acts as shall be required of bim in tbe specific execution of tbe contract according to tbe terms.” Pomeroy’s Eq. Jurisprudence (3 ed.), sec. 1407.

In Hudson v. Cozart, 179 N. C., 247, specific performance was denied because it was neither averred nor proved tbat plaintiff could or would perform tbe stipulation in tbe contract, which was tbe chief consideration for its execution by defendants.

Crawford, executor and trustee, having granted to E. G. Allen an extension of time for payment of tbe balance of tbe purchase price to 1 January, 1924, tbe failure of Allen to pay tbe rent, taxes and insurance, and to pay for tbe repairs on tbe building, did not work a forfeiture of bis rights under tbe contract or tbe extension agreement. Tbe agreement of Allen to make these payments were not conditions upon which tbe extension was granted, but covenants to be thereafter performed by bim. He was liable in damages for breaches of bis covenants, but sucb breaches did not affect bis rights under tbe contract; so tbat, on 1 January, 1924, tbe contract was in full force and effect. Crawford, executor and trustee, was under obligation to convey, and Allen (or bis assignee) was under obligation to pay tbe balance due, upon an accounting, on, tbe purchase price of tbe lot.

'The exact amount due on tbe purchase money on 1 January,' 1924, could not be determined until an accounting bad been bad. Tbe Capital Eealty Company, assignee of E. G. Allen, on said day, requested tbe accounting, and, tbe judge finds, was ready, willing and able, as it still is, to pay tbe said amount. Crawford, executor and trustee, denied bis obligation on tbe contract, and declined to offer compliance with same by tendering deed. He will not now be relieved upon bis contention tbat tbe Capital Eealty Company, did not strictly comply with tbe contract. “One of tbe reasons why tbe remedy of specific performance was introduced in equity was because at law tbe plaintiff is obliged to show on bis part precise compliance with all tbe terms of tbe agreement, whereas chancery would sometimes afford relief, although be was unable to prove this exact fulfillment. Courts of equity grant this relief by two methods, viz., one by decreeing performance with compensation for defects, and tbe other by giving time for tbe perforinance of tbe agreement.” Bispham’s Eq., sec. 488.

Tbe first two questions presented by Crawford, executor and trustee, having thus been determined in tbe negative, it becomes unnecessary to consider tbe third question. Tbe decree as to bim is approved and tbe judgment affirmed.

*444Tbe judge finds that Samuels and Levy took tbe lease from Crawford, executor and trustee, with full notice of tbe rights of tbe Capital Realty Company, and adjudges that- said lease is invalid and should be canceled as to said Capital Realty Company. To this finding, appellant, Samuels, excepted and assigns as error tbe conclusion of law on which this portion of tbe judgment is based. Tbe assignment of error is not sustained.

Tbe contract between Crawford, executor and trustee, and R. G. Allen, was duly recorded in Wake County on 13 January, 1920. Tbe assignment and conveyance by R. G. Allen to tbe Capital Realty Company was duly recorded in said county on 28 June, 1923. Tbe lease from Crawford, executor and trustee, to Samuels and Levy was executed in June and recorded on 18 July, 1924. Appellant, Samuels, therefore, bad constructive notice, at least, of tbe rights of tbe Capital Realty Company and of its assignor, R. G. Allen, when be and Levy took tbe lease. Such rights as they acquired i-n and to tbe lot were subject to tbe rights of tbe Capital Realty Company, under said recorded contracts. Tbe law as to Us pendens, so fully and interestingly discussed in tbe brief filed by counsel for appellant, does not necessarily apply.

The contention of both appellants that the Superior Court of Wake County is without jurisdiction, is not sustained by any facts appearing in the record. There are no allegations in the pleadings in either case, and no finding of fact by the judge upon which to base this contention. It is admitted that Crawford, executor and trustee, bad authority to make the contracts; that bis title bad been favorably adjudicated by the court. It cannot now be contended that Crawford, executor and trustee, was without authority to extend the time for the payment by R. G. Allen of the purchase money, certainly in the absence of evidence supporting the contention. It appears from bis report, filed as late as 21 February, 1924, in the Superior Court of Harnett County, that be bad granted extension to 1 January, 1924, and that the court was notified of such extension. the first action, begun on 1 February, 1924, against R. G. Allen and the sureties on bis bond, given pursuant to the agreement for extension, dated 16 December, 1922, was founded upon the allegation by Crawford, executor and trustee, that the contract bad been extended to 1 January, 1924. Appellant, Samuels, admits in bis answer that on 13 January, 1920, J. W. Crawford, executor and trustee, under the will of Ji H. Crawford, deceased, bad power and authority to sell and convey the lot of land, the subject-matter of this action.

Tbe findings of fact made by tbe judge are supported by competent evidence; bis conclusions of law are correct, and tbe judgment and decree are