Legro v. Lord

Mellen C. J.

delivered the opinion of the Court at the ensuing May term, in Oxford.

In the decision of the question reserved, it is proper for us to consider the facts which the counsel for the demandant offered to prove, in the same manner as though they had been proved ; and the inquiry then is, whether on all the facts thus existing, as reported, the action is by law maintainable ; if so, the nonsuit must be set aside. At the argument, the counsel frankly stated that he did not contend that parol evidence was admissible to contradict or vary the facts appearing on the face of the deed from Hayes and Lord to Ivory Lord, or in any manner control its construction; as by shewing that the money tendered by Ivory Lord was the money of Benjamin Lord, and that, so, a resulting trust was created ; but merely for the purpose of shewing a tender made to Hayes and Lord, in due season, of the sum due to them; that is, within one year from the time Benjamin’s equity of redemption was sold and conveyed by the officer to Maddox ; contending at the same time, that such tender, of itself, and independently of any conveyance from Hayes and Lord, at once extinguished all their interest in the equity of redemption; and that thereupon the same was restored to, and became the property of Benjamin Lord, and was therefore rightfully seised and sold the second time on execution to the demandant, at the suit of Benjamin’s creditor, notwithstanding the previous conveyance from Benjamin to Ivory; because, as the demandant contends, Benjamin then being indebted, the deed was fraudulent and void as against creditors. This appears to be the ground and the essence of the demandant’s objection to. the ruling of the presiding Judge, by which the parol evidence offered was excluded. — The facts of the case, arranged in order of time, are briefly these. Benjamin Lord, on the 15th of July; 1828, being then the owner of the demanded premises, conveyed the same in mortgage to Messrs. Hayes and Cogswell. On the 15th of April, 1829, the mortgager’s equity of redemption was legally sold on execution and a deed thereof given to Maddox; who, on the 12th of December, 1829, conveyed the same to Hayes and Lord. On the 21st of the same December, Benjamin Lord, the mortgager, by his deed of that date, released to Ivory Lord, all his right, title and claim to redeem the demanded premises, “ from the “ sale made in April lastand authorised the said Ivory to redeem said right in equity from said Maddox and his assigns; and also released all his, said Benjamin’s, right and interest in the ■ demanded premises. On the 13th of April, 1830, the day on which the tender was made, the said Hayes and Lord conveyed to Ivory Lord the “ right in equity of redeeming said] farm,” (the demanded premises) “ sold to Aaron Maddox.”

If the foregoing facts have not been disturbed, nor their effect destroyed by the proceedings on which the demandant relies, and the application of legal principles to them, the non-suit must be confirmed. He claims title to the premises in question under a second sale of the same equity of redemption, made on the 25th of December, 1830, as the property of Benjamin Lord. Now, according to the deeds and dates before mentioned, what estate or interest of any hind, .had Benjamin Lord, at that time in the demanded premises, or legal or equitable title or claim thereto ? His equity of redemption was sold and conveyed to Maddox almost two years before; and his right to redeem that equity of redemption, it is contended, he had conveyed to Ivory Lord, above twelve months before; and that both those rights had been conveyed to, and vested in Ivory Lord, more than ten months before. By the 57th section of chap. 60, of the revised statutes, a right in equity of redeeming real estate mortgaged, is made a subject of attachment, and of sale on execution, for payment of the debts of the mortgager; but the right, for one year, of redeeming such equity of redemption, when so sold on execution, u>as not liable to such attachment or sale, by any statute or principle of law, until March 4th, 1833. Kelly & al. v. Beers, 12 Mass. 387. Therefore, though Benjamin Lord might have been insolvent when he made the deed to Ivory, (though there was no proof, or offer of proof that such was the fáct, nor does the report disclose any,) still he had an unquestioned right to convey whatever was conveyed by the deed to Ivqry, without being impeached, on that account only, as acting the part of a fraudulent debtor. No creditor can be, in legal contemplation, defrauded by a mere conveyance made by his debtor of any of his property, which such creditor has no right by law to appropriate or even to touch by any civil process. This principle is perfectly plain, and its application is important in this case. It is also important to observe that the deed from Benjamin to Ivory is an absolute conveyance of all his right, which was the right of redeeming the equity of redemption.

In the above particular, the case at bar is distinguished from, that of Reed v. Bigelow, 5 Pick. 281, cited for the demandant. In that case, the Court, speaking of Kelly & al. v. Beers, say, “ By the equity, the mortgager’s whole legal estate passed; but “ he had a right to redeem that equity; and when he assigns “ this right by way of mortgage,” (as was the case in Reed v. Bigelow) “ he has a right to redeem it back again by perform- “ anee of the condition. This new right, created by the second “ mortgage, we think attachable, and may be sold on execution.” No one will doubt the correctness of the above principle, or fail to perceive the manifest distinction, in an essential point, between that case and the one under consideration.

We would again observe, that it is contended by the counsel for the tenant, that all the rights which Benjamin had, he undertook to convey, and did convey, by his deed to his son Ivory; that though he had no legal estate in the premises, he had one equitable right, and Hayes and Lord had another; and that both these rights were acquired by Ivory and united in him on the 13th of April, 1830, according to the language of the two deeds. If such was the fact, and if the transaction was fair and in good faith, which terminated in this arrangement, then the cause seems clearly with the tenant; for though the right to redeem an equity of redemption is not liable to attachment and sale on execution, yet it is assignable, as was decided in Bigelow v. Wilson, cited in the argument. But it is contended that it appears from the very terms of Benjamin’s deed to Ivory, that he was to act as the attorney and for the benefit of Benjamin in the redemption of the right in equity to redeem the mortgage, and that a real sale seems not to have been in the contemplation of the parties to that deed: — and it is further contended, that the deed was fraudulent, and that the demandant should have been permitted to introduce the evidence to prove the fraud, which, however, the presiding Judge excluded. This is a point upon which, for some time, our minds have been in a state of vibration, in consequence of the peculiar nature of the right which Benjamin conveyed to Ivory ; the same not being by law attachable, or saleable on execution. We now say, as we have before said, that the mere conveyance of this right, unconnected with other circumstances and events, could not be a fraud on creditors ; because creditors could not attach or seise it on execution. But if the money tendered and received, was the money of Benjamin, and the right was conveyed to Ivory with the intent and for the purpose of enabling him to redeem the equity of redemption in his own name, and for the further purpose of his redeeming the mortgage in his own name, and holding the estate secure from the creditors of Benjamin, and for his use ; pursuant to a fraudulent arrangement made between Benjamin and Ivory, we are of opinion that the creditors of Benjamin may prove the fraud, one of whom is the present demand-ant ; and such a fraud being proved, the effect must have been, that by the tender made to Hayes and Lord of the sum due, their rights at once were at an end, without a deed of conveyance from them, and the equity of redemption immediately was restored to Benjamin, and was lawfully seised and sold on execution and conveyed to the demandant by the officer. Such a construction of such an arrangement, if fraudulently made for the purposes above-mentioned, is necessary to secure to honest creditors their rights, and prevent the triumph of intrigue, dishonesty and fraud.

From what we have stated, it is perceived that there must be a new trial; and to prevent further examination of any of the questions of law which have been discussed by the counsel, we would now observe that we can see nothing resembling a merger, as has been contended. It is difficult for us to discover the bearing, or, indeed, the meaning of the argument on this point. No doubt, as we have before observed, there was a union of the two equitable titles or rights in Ivory; at least as to all persons but creditors ; but surely there is no union of the titles of the mortgagees and mortgager in the present case. The rights of the mortgagees have not been affected by any of the acts of the mortgager or his assigns or any creditor of the mortgager, either in respect to the equity of redemption or the right in equity of redeeming the same. The mortgage remains in full force : and with that title the demandant has no connection at present. “ A merger takes place when there is a union of the freehold “ or fee, and a term in one person, in the same right and at the “ same time,” — “ an estate for years may merge in an estate in “ fee, or for life : the merger is produced, either from the meet- “ ing of an estate of higher degree with an estate of inferior “ degree; or from the meeting of the particular estate, and “ the immediate reversion in the same person.” 4 Kent’s Com. 98.

We are all of opinion that, for the reasons we have assigned, there must be a new trial.

Nonsuit set aside and new tidal granted.