Case ID: wis_163/html/0264-01.html
Source: Caselaw Access Project
Author: {"author": "SiebecKER, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Ditberner, Respondent, vs. Bess, Appellant.
    
      April 4
    
    May 2, 1916.
    
    
      Vendor and purchaser of land: Fraud: Estoppel: Resale: Foreclosure of contract: Equity: Rights of original 'vendee: Liens: Parties.
    
    1. One G., who bad an interest in land, agreed to procure the title of the other owners and convey to plaintiff for $2,000. Plaintiff paid $50 down, also paid off a mortgage of $258 owing by G., and took possession. Afterwards defendant contracted to purchase the land from plaintiff for $2,500, paid $50 down, and agreed to pay $750 in one month and give a mortgage for the remainder. Plaintiff turned over the possession to defendant. Thereafter, by collusion with G., defendant purchased and got conveyances of the land from G. and the other owners for $2,100. Defendant having defaulted on his contract with plaintiff, the latter sued to foreclose that contract. Held that, by conveying to defendant, G. and the other owners had estopped themselves from claiming any purchase money from plaintiff under his contract with G., and that plaintiff, being relieved from that obligation, was not entitled to strict foreclosure or recovery of the full contract price against defendant, but was entitled to enforce against defendant and the land an equitable claim for the amounts ($308) paid out by him, and also the amount ($500) which defendant was to pay to plaintiff over and above what plaintiff was to pay to G., less the $50 which defendant had already paid to plaintiff.
    2. On reversal, in such case, of a judgment of foreclosure and for the full purchase price under the contract between plaintiff and defendant, plaintiff is allowed to bring in as parties any persons claiming liens on the land under the defendant, and also to bring in G. as being a joint wrongdoer with the defendant in an attempt to defraud the plaintiff.
    Appeal from a judgment of tbe circuit court for Buffalo county: Geobge ThompsoN, Circuit Judge.
    
      Reversed.
    
    This is an action to foreclose a land contract for the purchase of certain lands by defendant from plaintiff. Defendant defaulted in making payments of the purchase price as the contract provided.
    The land in question was owned by Peter Guler and his seven children. After some negotiations between plaintiff and Peter Guler and the children, Guler agreed to procure the title and sell the land to plaintiff for $2,000. The parties engaged an attorney to have the necessary papers drawn up, and upon learning that it would take some time to get the clear title from the children an agreement was signed by Peter Guler whereby he acknowledged payment of $50 and agreed to procure good title for Ditberner. The payment of the balance of the purchase price was also agreed upon in this contract. Some of the children executed the necessary deeds and left them with the attorney. The defendant, who had some furniture stored in the house, turned the keys over to plaintiff and plaintiff took possession. The plaintiff planted the land to corn and cared for it up to the time he surrendered possession to' defendant. The defendant, Bess, ■negotiated with the plaintiff for the purchase of the land, and on June 1Y, 1914, signed a written agreement to purchase it at the price of $2,500. The plaintiff and Bess consulted the attorney who was acting for plaintiff and Peter Guler, to have the necessary papers prepared. The attorney explained to them that tbe plaintiff could not then give a clear title, as the Guler children had not all deeded their interests to him. A memorandum of the agreement of sale was drawn up and signed by plaintiff and $50 was paid him by the defendant. This memorandum provided for the payment of $’750 on July 1, 1914, and the giving of a first mortgage to plaintiff to secure the balance of the purchase price. Plaintiff turned over possession of the place to defendant after this contract was executed. Soon after this Peter Guler went to plaintiff’s attorney and told him to do nothing more in regard to his sale because he was not going to carry out his original agreement with the plaintiff. Peter Guler and defendant colluded to ignore their contracts with the plaintiff and that Peter Guler should sell the land to defendant at the price of $2,100, which was $400 less than defendant had agreed to pay plaintiff for it. The defendant procured deeds from Peter Guler and all his children, who had an interest in the land, and had them recorded. About the 1st day of July plaintiff demanded payment of defendant under his contract and stated that he was ready to close the deal. Defendant refused to pay plaintiff and also refused to give plaintiff the possession of the land upon plaintiff’s tender to return the $50 he had received from defendant.
    The defendant alleges that the plaintiff was acting as his agent in the original purchase from Peter Guler and had falsely represented the price to him and had fraudulently taken the contract with Peter Guler in his own name. Further, that plaintiff had falsely and fraudulently induced the defendant to enter into the contract here involved and to pay the sum of $50, and by way of counterclaim defendant asks to recover the $50 so paid.
    The trial court found that plaintiff was not guilty of any fraud in the transaction, as alleged by defendant, and entered judgment to the effect that the defendant be barred from all right, lien, claim, interest, or equity of redemption in the land if be did not pay to plaintiff witbin thirty days from tbe time of tbe service of a copy of tbis judgment on bim or bis attorney tbe sum of $750 with interest, together with tbe costs and disbursements of tbe action, and execute and deliver to plaintiff a first mortgage on tbe premises to secure tbe sum of $1,700, payable in annual instalments of at least $100 each, with interest thereon at tbe rate of six per cent, per annum from July 1, 1914, as stated in tbe agreement. From such judgment tbis appeal is taken.
    
      M. L. Fugindj for tbe appellant.
    
      3. G. Gilman, for tbe respondent.
   SiebecKER, J.

Tbe judgment awarded goes upon tbe ground that plaintiff is entitled to recover tbe purchase price of tbe farm under tbe land contract between himself and defendant, and in default of tbe payment thereof to have tbe title to tbe premises transferred to bim from defendant. As appears from tbe foregoing statement, tbe plaintiff bad not tbe title to tbe land when be contracted with defendant to convey title upon tbe conditions expressed in tbe contract, and be is not capable of conveying tbe title of tbe premises to defendant pursuant to bis contract because Peter Guler has disabled himself to acquire title thereto for plaintiff as required by bis contract with plaintiff. It also appears that defendant has acquired title to tbe premises by conveyances from Peter Guler and bis children and that'this is the title plaintiff contracted to acquire and convey to defendant. Tbe Gulers by their conveyance of the. premises to defendant have estopped themselves from claiming any right to any of tbe purchase money from tbe plaintiff under bis contract with Peter Guler for tbe conveyance of tbe premises. They must look to defendant for tbe purchase price of tbe farm. Tbe result of- these transactions is that defendant has tbe title to tbe premises which plaintiff promised to acquire for bim and that plaintiff is relieved from bis obligations under bis contract with Peter Guler. Plaintiff, however, has a right to enforce whatever claim he has against defendant arising out of their contract for the sale and conveyance of the premises. Since the defendant’s transaction with the Gulers relieved plaintiff from paying them the balance due on the Peter Guler contract, equity demands that the defendant receive the benefit there®f to discharge his obligations under the contract with plaintiff. It appears that the plaintiff had paid Peter Guler $50 as part payment of the $2,000 purchase price of the farm. Plaintiff also paid a $258 mortgage on the farm owing by Peter Guler. These two payments total $308. The plaintiff was also entitled to receive from the defendant the amount which defendant agreed to pay plaintiff for the farm over and above the amount plaintiff agreed to pay Guler, namely, $450, in addition to the $50 defendant paid plaintiff when the contract was signed. The plaintiff’s equitable claim and interest in the land arising out of these transactions therefore amounts to $758, and he has an equitable claim on the premises for this amount and for his costs in the action. From this it follows that the court erred in awarding plaintiff a judgment for the full contract price defendant agreed to pay plaintiff for the premises, and also erred in awarding a strict foreclosure of all of defendant’s interest and title that he had .acquired from a source other than plaintiff in default of the payment of the full $2,500 purchase price. The result, of the decree would be to transfer to plaintiff a title and interest in the land he never owned and which he under the circumstances could not acquire. True, he had a contract right to acquire title to the premises from Peter Guler, but Peter Guler defaulted in securing title for plaintiff as he had agreed, and plaintiff had no legal grounds to compel the Guler children to deed to him. The defendant purchased the premises directly from Peter Guler and children, but this transfer does not operate to confer on plaintiff the right to -have such title and interest transferred to him upon defendant’s default under bis contract witb plaintiff. Tbe only right plaintiff bas under bis contract of tbe sale of tbe premises to defendant is to enforce bis equitable interest in tbe premises to tbe extent of tbe amount be bas invested in tbe land, wbicb is, as above shown, tbe sum of $'758. This interest arises out of bis contracts witb Peter G-uler and tbe defendant and under tbe purchase or payment of the Guler mortgage.

Plaintiff’s rights against defendant for bis claim can be secured by a judgment awarding him an equitable interest by way of a judgment lien on tbe premises to this amount, and, in case defendant defaults in paying it, directing a foreclosure and sale of tbe defendant’s interest in tbe land and applying tbe proceeds of such sale in satisfaction of plaintiff’s claim and tbe costs be incurred to enforce bis rights. It also appears by tbe evidence that tbe defendant, Bess, bad not tbe cash to purchase this land and that bo intended in case of purchase to mortgage it or otherwise convey tbe title to secure tbe money to pay tbe purchase price. Tbe record does not disclose what bas been done in this regard. There is evidence tending to show that Peter Guler colluded witb defendant to defraud plaintiff out of tbe $500 tbe defendant agreed to pay plaintiff for tbe land above tbe amount tbe plaintiff agreed to pay Peter Guler for securing and conveying a clear title thereof to plaintiff. It cannot be determined from tbe record whether plaintiff can be protected as against others who may have obtained liens on defendant’s interests. In view of tbe fact that tbe judgment appealed from must be reversed, tbe plaintiff may desire to have others claiming liens, if any exist, made parties to this action and have their rights determined and declared. Tbe plaintiff may also, if be is so disposed, ask to have Peter Guler, apparently a financially responsible person, made a party to this action upon tbe theory that be is a joint wrongdoer witb defendant to defraud plaintiff of bis rights to and interest in the lands, so as to enable plaintiff to seek satisfaction of bis demands by securing judgment against both Bess and Peter G-uler. In the light of these conditions we consider it appropriate that this court should not enter a final judgment upon the record, but that the case should be remanded to the circuit court for such further proceedings as the parties may deem proper and as the court may find just and conformable to law.

By the Court. — The judgment appealed from is reversed, and the cause is remanded to the circuit court with direction for further proceeding as indicated in this opinion, conformable to law.