Canoy v. Troutman, 29 N.C. 155, 7 Ired. 155 (1846)

Dec. 1846 · Supreme Court of North Carolina

29 N.C. 155, 7 Ired. 155

DEN ON DEMISE OF JACOB CANOY vs. HENRY TROUTMAN.

A fraud in the consideration or treaty, on -which a deed is obtained,- is a ground for impeaching it in equity, but it does not avoid it at law. To have that effect, it is necessary the execution of the deed should be obtained by fraud, so as to make a case for the defendants on the plea of non est factum.

When land is conveyed in fee to a person, under certain trusts mentioned in the deed, the trustee can convey a legal title to the property, so as to enable the alienee to maintain an action of ejectment. The question, as to his equitable right to convey, (or a different purpose than that authorized by the trust, is one of purely equitable jurisdiction, and cannot be entertained in a Court of Law.

The cases of Logan v.’Simmons, 1 Dev. & Bat. 13, and Reed v. Moore, 3 Ired. 310, cited and approved.

Appeal from the Superior Court of Law of Cabarrus County, at the Spring Term, 1846, his Honor Judge Caldwell presiding.

Upon the trial of this ejectment, the plaintiff, in order to shew a title in his lessor, read in evidence a deed for the premises mentioned in the declaration, which was made by the defendant to one Jacob Troutman on the 4th of May, 1843. It purports, that the defendant, “ Henry Troutman, in consideration of the sum of one dollar, to him in hand paid by the said Jacob Troutman, the receipt whereof is hereby acknowledged, hath bargained and sold and by these presents doth bargain and sell unto the said Jacob, his heirs and assigns, that certain parcel of land lying &c. to have and to hold to the proper use and behoof of the said Jacob, his heirs and assigns forever : In trust however, and to the intent and purpose, that the said Jacob hath entered surety for said Henry on a judgment obtained against him by Conrad Casper, before a Justice of the Peace for an appeal to the County Court of Cabarrus County: and if the said suit be decided in Court and the said Henry Troutman shall be east and made liable for the costs and shall fail to pay them within two months thereafter, then, and in that case the said Jacob is to enter into the premises, and take possession and expose the said lands to public sale on the premises for cash, after giving twenty days notice, and out of the money arising from the sale of such land, shall pay all the costs and charges of the aforesaid suit, and the residue of such money, if any, shall pay to the said Henry or his assigns.” The plaintiff further proved a sale made by Jacob Troutman on the premises, to the highest bidder, and that the lessor of the plaintiff became the purchaser at a fair price, and received a conveyance from Jacob Troutman.

The defendant then, in order to impeach the foregoing title, proved that in April 1843, Conrad Casper obtained a judgment against him before a Justice of the Peace for $50 ; and that he prayed an appeal therefrom and obtained leave to give security therefor within ten days : that he applied to Jacob Troutman to be his surety for the appeal, and proposed to give him, when requested, a deed of trust for his land as an indemnity; and that said Jacob assented thereto,, and agreed that he would go to the Justice, and become the surety accordingly: that within the ten days* the said Jacob went to the Justice* . in the absence of the defendant, and offered himself as surety for a stay of execution ; and that the lessor of the plaintiff, being then present, remarked to the said Jacob, that the defendant did not want a stay of execution, but wanted an appeal ;■ and that, nevertheless, the said Jacob persisted in becoming surety for the stay of execution, instead' of an appeal': that, within a few days thereafter, Jacob Troutman applied to.the defendant to give him the deed of trust, as he had promised; but did not inform the defendant, that he had not become surety for an appeal, but for a stay of execution: and that the defendant thereupon executed the deed herein before set forth. When the stay of execution expired, Jacob Troutman paid the judgment, and then made the sale and conveyance to the lessor of the plaintiff: at which sale the defendant was present, and forbade the same.

Upon the foregoing evidence, it was insisted on the part of the defendant, that Jacob Troutman had been guilty of a fraud, which avoided the deed to him ; and therefore, that the plaintiff could not recover. But the Court was of opinion, that there was no evidence of a fraud in obtaining the execution of the deed, and therefore that it was not void on that ground.

And it was further insisted on the part of the defendant, that the contingency had never arisen, on which Jacob Troutman could rightfully sell and convey the land. Without any decision thereon, a verdict was, by the consent of the parties, rendered for the plaintiff, subject to be set aside, and a non-suit entered, if the Court should be of opinion for the defendant, on that point. On consideration thereof, his Honor held, that no power to sell had accrued to Jacob Troutman, because there had not been an appeal, nor costs incurred in Court, which the defendant failed to pay, as provided for in the deed to him ; and therefore, that said Jacob could not make a good title to the lessor of the plaintiff. Accordingly, the verdict was set aside, and a judgment of non suit given: from which the plaintiff appealed.

Osborne, for the plaintiff.

Alexander, for the defendant.

Ruffin, C. J.

The Court is of opinion, that there ought to have been judgment for the plaintiff on the verdict in his favour. On the first point made, this Court concurs with his Honor. A fraud in the consideration or treaty on which a deed is obtained, is a ground for impeaching it in equity ; but it does not avoid it law. To have that effeet, it is necessary the execution of the deed should be obtained by fraud ; so as to make a case for the defendant on non est factum. Logan v. Simmons, 1. Dev. & Bat. 13. Reed v. Moore, 3 Ired. 310.

Upon the other point the Superior Court treated the deed, as if it created only a power in Jacob Troutman to make a sale in certain events; which events, it is very clear, did not occur. But that is not the true construction of the instrument. It neither confers a contingent power merely, nor even an estate on condition. But it is a deed of bargain and sale in fee, and carries with that estate every legal incident to it, including that of alienation. The estate is absolute at law, without any limitation or restriction. It is true the legal estate is conveyed and accepted upon a trust, and on it are engrafted certain conditions and restrictions. But with the construction and enforcing of trusts, or giving redress for the breach of them, a Court of law has no concern. That jurisdiction belongs to another tribunal; which may, and probably, will hold the present lessor of the plaintiff to hold the legal title precisely upon the same trusts, on which his bargainor did. Yet he is not the less tenant in fee-by virtue of the conveyances from the defendant to Jacob Ti'outman, and from the latter to him ; and as tenant in fee he must recover in an action of ejectment against even his own cestui que trust, because a Court of law cannot take notice of a trust, excópt so far as it is in some instances made the subject of cognizance at law by certain statutes. Not only does this deed convey the estate,, and not simply create a power in Troutman to sell, but it does not convey the estate as a mortgage does, upon a condition, by the performance of which the estate of tho mortgagee determines and the title revests in the mortgagor without a reconveyance. Thus in the case of a proper mortgage,, if the- mortgagor pay or tender the money at the day, he saves the forfeiture of the estate, and it is immediately in him by force of the terms of the deed, as a legal interest. But deeds of trust like the present, are entirely different, and convey the whole title at law to the trustee, and he is accountable in equity only. It is in vain to say, that he ought not, according to the trusts, on which he took the legal title, to have sold. For, still he had the legal title and conveyed it; and the legal title «ought always to carry a person through a Court of law in an action turning on the title. For an injury to another, by perverting his legal title to a different purpose from that on which he took it, he is amenable in a different form.

The judgment must therefore be reversed, and judgment be entered for the plaintiff on the verdict in his favour.

Pee Curiam. Judgment reversed and judgment for the plaintiff.