Bell v. Stainer

Jewett, Chief J.

The object of the complainant’s bill was to set aside, and procure to be cancelled, a bond and mortgage, executed by the complainant to James H. Bell, one of the defendants in the court below, and which he assigned to Isaac Bell, the appellant, on the ground of fraud. The bond and mortgage as is alleged and admitted to be true, were given to secure the payment of two third parts of the purchase price of three lots of land in the city of Sandusky, state of Ohio, which J. H. Bell contracted with the complainant to sell him in June, 1836. The fraud, as alleged in the bill, is, that J. H. Bell, never having had any legal or equitable title to the premises, except such as he derived through -a contract for the purchase thereof of the owner, which had become forfeited, and which he concealed from the complainant, with the view and intent to defraud him at the time he made the contract with the complainant to sell him the premises, and received $2,000 toward the purchase price thereof, and with the view and intent to. defraud him, pretended to he the owner thereof . The defendants answered under oath, as called for by the bill.

J. H. Bell, in his answer, positively denies that he ever pretended to be the owner of the premises, with the view and intent to defraud the complainant; or that he ever pretended to be the owner thereof, or that he concealed the existence of the alleged contract of sale,, or conditional sale, as called in the bill, with the view and intent to defraud the complainant, or that he concealed it at all from the complainant. It appears that J. H. Bell, at the time of the contract, resided at Sandusky, and that the complainant resided in New-York : that one A. A. Melly, as the agent of the complainant, was at Sandusky, and in his behalf made the contract with J. H. Bell for the purchase of the premises, and drew upon the complainant in favor of Bell for $2,000, in part satisfaction of $6,000, agreed upon as the consideration of the purchase.

J. H. Bell further in his answer says, that Melly, previous to and at the time of making the contract, and while he' was such agent and acting in that character, was fully aware of his title to said premises, and that he had only a contract from J. and J. W. Hollister for the sale of them to him; that the contract between the complainant and him was made with a full knowledge, on the part of Melly, and that the same was made under said contract which he had entered into with said Hollisters.

This answer thus far is responsive to the bill, and, as such, evidence of the truth of the matter so set up: the inquiry then follows, is it overcome by the testimony in the cause 1 The rule on this point is admitted to be, that unless it be overcome by the testimony of at least two witnesses, or by one witness and by circumstances, equal to another, the answer must prevail.

The only- wdtness relied on to impeach the answer by his evidence is Melly. He says, in the spring or early in the summer of 1836 he met J. H. Bell at Sandusky, and then told him that Stainer wanted to invest some money in lots at San-dusky : that Bell either said that he had some lots, or would buy some lots for Stainer, and showed him the lots so to be sold to Stainer, and marked lots on the map so to be sold to him; that he did not know whether the lots belonged to Bell or not; he told Bell that Stainer had authorized him to draw on Stainer for one-third of the purchase money, the balance to be left on bond and mortgage: that Bell said nothing about the title he had, nor anything as to any agreement which he held for the purchase of said lots. He said he would send the paper titles to New-York. That he did not learn for a year or more after the sale that Bell had -no deed for the lots. At the time of the sale, Melly understood, as a matter of course, that the titles thereto were to be perfect and good ; that when in the spring or summer of 1836 he asked for his title deeds, Bell said that he could not then give them to him, as the register was absent, or something to that effect.

This is all of the testimony which affects this question, unless it may be that the contract for the sale of the lots was merely verbal, not reduced to writing, and that Melly drew the draft for $2,000 toward the price, and delivered it to Bell.

The fact that Bell assumed to sell the lots is not denied, although the fact that he pretended to be the owner thereof is professed to be. It must rest upon a distinction which is evidently intended to be taken by the answer, between the position of a person when contracting to sell and convey a piece of land without in words alleging himself to be owner, and that of one who, when making the like contract in words, announces himself to be the owner; a distinction too slender and nice, I apprehend, for any principle of law or equity to see or comprehend.

The acts of Bell, as detailed in the answer above, are sufficient, in my judgment, to say that he occupied the position toward the complainant of pretending to be the owner of the lots. He contracted to sell, and I entirely agree with the. assistant vice-chancellor, that it was not necessary for Bell to use words to hold, himself out as the owner. The answer in this respect must be understood as denying merely that Bell in words told Melly that he was the owner; and in that sense there is no conflict between it and the testimony of Melly, or the circumstances of the transaction. The- answer denies that he concealed from the complainant the existence of the contract of sale which he, Bell, had for the purchase of the lots.

And he goes further, he does not say in so many words that he told Melly that his title rested in a contract with the Hollisters for a purchase of' the premises; but he says he had only such contract, and that Melly was fully aware of his title ; and also that he had only such contract; and with full knowledge. on the part of Melly of these facts, the complainant, by him, entered into the contract of purchase with him, Bell. That Melly knew of the contract under which Bell claimed the premises, or that he claimed at all under a contract, and not under a deed, is fully contradicted by the testimony of Melly. But I do not see in this case any circumstances to corroborate Melly’s testimony in that particular, beyond what may be inferred from the ordinary conduct of most men, attentive to their own interests, and security in dealing, in any other year than 1836, would have been the conduct of the complainant, or of Melly his agent, if he did know upon what baseless foundation Bell’s title rested, which I do not think can be allowed at any time, as circumstantial evidence to overthrow the positive evidence of an answer under oath responsive to a bill: and more especially in favor of a party confessedly entering into a mere verbal contract with a man residing in a distant place, for the purchase of lands there situated, upon so large a consideration as $6,000; and advancing one-third of the sum at the time, without making the slightest examination as to the title, or, so far as it appears, without any definite time fixed by the contract for its consummation.

Therefore, in my opinion, unless we say that the evidence in the case shows that Melly, at and before the time he entered into the contract with Bell, had knowledge that Bell had no other title to the lands in question than such as the contract with the Hollisters passed to him, and upon that ground, and no other, Bell assumed to be the owner, we should fail to give the answer the force and effect to which it is entitled by well settled principles. If Í am right in this conclusion, the case shows that Bell was not guilty of any fraudulent concealment, that his title rested upon the contract with the Hollisters, or any fraud in holding out to Melly that he was then the owner of the premises. But this is not all. Up to January, 1837, the parties were under no legal or equitable obligation with each other to perform the contract. Bell was liable to refund the $2,000 on demand. What took place at that time we have not only the answer of Bell, but it is admitted by the stipulation of the solicitor for the complainant, so far that in that month Bell came to New-York, then saw the complainant, who was shortly to leave the city for Europe; that Bell then executed to the complainant the deed set forth in the bill, (which bears date the 1st of August, 1836;) that the complainant thereupon, by his attorney, Dutilh, executed and delivered to Bell the bond and mortgage in question, and who thereupon assigned the same to Isaac Bell for the consideration of $3,500, then paid to him by the latter.

The answer goes further; it alleges 'that he, J. H. Bell, at that time told the complainant that he could not give him any other paper than a release, or quit-claim, of his right and title under the contract with the Hollisters; that he had not then the legal title to the premises, and only held said contract of sale; and that he would not then make a legal title. That the complainant said he would be satisfied with any thing that Bell could or would choose to give him, as an evidence that he had any title whatsoever in the premises; and that as he was in' a hurry and going to Europe, he had not time to attend to it, and would authorize Mr. Dutilh to give Bell a bond and mortgage for the balance of the purchase money; that Bell then completed the purchase with the complainant by executing and delivering to him the deed, and received the bond and mortgage executed by the complainant by his said attorney, to secure the payment of $4,000, the balance of the purchase money. It is said that this statement is not credible ; but it is responsive to the bill, and entitled to be credited as true, unless there is competent evidence in the case to show it false. What evidence of that -character is there in the case 1 There is not the evidence of any witness on the subject, substantially; all the facts in that respect stated in the answer, except that which relates to the conversation alleged to have taken place in relation to Bell’s title, and his ability to convey a valid title, is admitted. It is said that the giving of a deed by Bell, with a covenant of warranty for quiet enjoyment, is a declaration that he was the owner in fee simple absolute. I do not see that why may it not as well be taken as showing that the complainant reposed full confidence in Bell’s ability, at some future day, to complete his title to the land under his contract with the Hollisters, and a reliance upon his integrity, as well as pecu-' niary interest, so to do, by which, the title would enure to his benefit, and thereby save any breach of his covenant which might otherwise thereafter occur; and if he failed thus to complete his title, he could safely fall back upon the covenant of warranty, and obtain ample redress; and that Bell, fully believing that he could and should thereafter complete his title, did not hesitate to give such deed. But again, it is said, if Bell had given the complainant such information in regard to his interest as stated in the answer, and intended honestly to transfer to him such right as he had, he would have executed an assignment of the contract which he held for the lots, leaving the complainant to fulfil the unpaid purchase money on the Hollisters, and taken his personal obligation for the residue of the $4,000.

I am not able to see a foundation for such inference strong enough to impugn the truth of this answer. So far as the case shows the facts, admitting the answer in this respect to be true, and conceding to Bell an honest intention to convey to the complainant what interest he had in the premises, I do not think it at all clear that men of ordinary sagacity would have transacted that business in the manner suggested.

It does not appear how much was due upon the contract to the Hollisters, whether more or less than $4,000 ; nor certainly hut that the contract was forfeited, and the Hollisters absolved from its performance. It does appear that there had been a breach of it on the part of Bell—he had not paid according to its terms. Stainer, as I infer from the fact of his paying subsequently one year’s interest, and that the $4,000, by the contract was to be kept on bond and mortgage, was to have some time thereafter to pay. He was on the eve of going a journey to Europe. Now under these circumstances, living at the distance he did from the premises, probably a stranger to the Hollisters, having confidence in the pecuniary responsibility as well as the honesty of purpose of Bell, is it not quite as probable that he would prefer to take tho deed, and give the bond and mortgage, than to take an assignment of the contract, and take upon himself the trouble, responsibility, and risk of obtaining a title through it. He might well have supposed that Bell, by his covenant in the deed, would feel a desire to obtain a title to save it; and that being a neighbor to, and acquaintance of the Hollisters, would, in case of a technical forfeiture of the contract, be more likely to obtain the title under it than he would, situated as he was.

Other considerations have been suggested in regard to the transaction of giving the deed, from which references have been drawn to impeach the answer in that particular, which seems to me to be too light to be indulged for such purpose. It seems to me, therefore, that the case fails to show that J. H. Bell was guilty of the fraud charged in the bill, either in making the contract or in its consummation, by giving the déed and taking the bond and mortgage; and that it is unnecessary to consider whether the complainant, by any act of his, subsequently waived or barred his defence to the bond and mortgage in the hands of Isaac Bell.

I am of opinion that the decree of the court of chancery, and that of the assistant vice-chancellor, should be reversed, and that the bill should be dismissed with costs of the court of chancery.

Decision—Decree of the court of chancery, as also that of the assistant vice-chancellor, reversed, and bill dismissed with costs in the court of chancery—unanimously.

Note.—Jewett, G. J. Held, that the case failed to show that James H. Bell was guilty of the fraud charged in the bill, either in malting the contract or in its consummation by giving the deed and talcing the bond and mortgage; and that it was unnecessary to consider whether the complainant, by any act of his subsequently, waived or barred his defence to the bond and mortgage in the hands of Isaac Bell.

Not reported.