Case ID: tenn_20/html/0491-01.html
Source: Caselaw Access Project
Author: {"author": "Turley, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Smitheal vs. Gray, et als.
    
    Ephraim Gray purchased a lot in the town of Portersville, paid the con, sideration money, and procured the execution of a deed therefor to his broth, er, H. Gray, for his own benefit: Held, by the court that H. Gray held this lot of ground as a trustee for the benefit of E. Gray, and that it was subject to be seized and sold byjt. fa. from a court of law against E. Gray, and that this trust could be raised by parol proof.
    No person is protected as a subsequent purchaser unless, either by his plea or answer, he shows himseli to be suoh by an explicit averment that he pur, chased for a valuable consideration, which he has paid without notice, and that he has taken a conveyance of the legal title.
    Where the defendant purchased of the trustee, took a deed and paid the purchase money after the levy of a fi. fa. upon the lot and before the sale under a venditioni exponas'. Held, that they had constructive notice of com. plainant’s claim and were not innocent purchasers.
    Where the defendant fails to put in an answer to a bill alleging that he was not a purchaser for a valuable consideration without notice, but that he was cognizant of all the facts and a party to the fraudulent transaction! Held, that he thereby admits the notice.
    Tobias Smitheal filed this bill in the chancery court at Brownsville on the 4th day of November, 1836, against John Polk and Murdoch Murchison, citizens of Tipton county». Ephraim Gray and Harvy Gray, citizens of Arkansas, and against M. T. Martin and Robert J. Clow, citizens of the republic of Texas,
    The bill alleges that Ephraim Gray purchased a lot in the town of Portersville, in Tipton county, paid the purchase money, and, with a view to defraud his creditors, procured the vendor to execute a deed in fee simple to his brother, Harvy Gray; that Harvy Gray held the lot in trust for the benefit of Ephraim; that complainant obtained a judgment before a justice of the peace of Tipton county for the sum of one hundred and forty dollars against E. Gray; that an execution was issued, levied upon this lot for want of personal property on the 12th of July, 1833, returned to the county court, and an order of condemnation entered up against the lot on the. 6th of September, 1833, and that it was sold on the 1st of March, 1834, by venditioni exponas, and that complainant became the purchaser. The bill further alleges that on the 10th of September, 1833, H. Gray sold and conveyed the lot to Martin and Clow; that on the 5th pf May, 1834, Martin and Clow sold and conveyed to ¿Tames Hodges; that Hodges on the 30th of January, 1835, sold and conveyed to John Polk, and that Polk on the — day of April, 1835, sold to Murdoch Murchison and gave him a bond with covenant for conveyance. The bill further charges that neither Martin and Clow, Hodges, Polk, nor Murchison were purchasers for a valuable consideration without notice; and prays that such of the defendants as ppssessed the title to the lot should be divested of it and that it should be vested in the complainant, and for other relief.
    By agreement of parties, answers from Clow, H. Gray and Ei Gray were not required and were not filed. Hodges did not answer. Martin answered and stated that Martin and Clow purchased and paid for the lot at the time stated in the bill; that he knew nothing of the truth of the allegation that E. Gray had purchased the lot and paid for it, and took a deed of conveyance in the name of H. Gray. Polk answered and admitted that he had purchased at the time stated in the bill, and that he had heard of the proceedings of complainant against the land at the time of purchase; and Murchison answered and stated that he had purchased and had a bond for title, and had never heard of the claim of complainant until after his purchase. Smitheal filed replications. Proof was taken, which established clearly that E. Gray made the contract for the lot, paid the purchase money and took a deed in the name of his brother, H. Gray, with a view to prevent his creditors from seizing upon it.
    The cause came on to be heard at the November term, 1838, upon the bill, answers, replications, exhibits and proofs. The bill was dismissed and an appeal taken to this court.
    
      G. D. Searcy, for plaintiff in error.
    1. Ephraim Gray, the defendant in this execution, having purchased and paid for the property and caused the deed to bo made to Plarvy, constituted Harvy a trustee, and as such he held the property for the use and benefit of Ephraim the ccstxá que trust. 3 Playwood, 70: Story’s Equity 443. This trust may be proved by parol; a declaration in writing is not necessary. Vernon, 376: 2 Atkins, 150: 1 John. O. R. 582: 2 John. C. R. 405: 11 John. R. 91. Harvy, the trustee, by virtue of the deed from Hodges, was seized of the lot. 4 Cruise, 58 and 59.
    2. Tiiis trust is the subject of sale under execution at law, by virtue of the statute of 29 Charles II, ch. 3, sec. 10, declared to be in force in this State. The language of the statute is broad; it directs the sale of all lands and tenements, &c. that any other person or persons be in any manner seized or possessed in trust for him against whom execution is sued out. This covers all trusts which are secured by or result from a conveyance. This is not a trust covenanted to be raised, but a trust raised by and resulting from the conveyance by Hodges to Harvy Gray, who by virtue of that conveyance was seized to the use of Ephraim, the defendant in the execution.
    The case of Russell vs. Stinson, 3 Haywood, 5, settles the question. Stinson purchased and paid for the land, and, to defraud his creditors, procured the deed to be made to his children; the court there held that by the payment of the purchase money Stinson acquired a trust which was, by our law, the subject of sale under execution at law. Al- - terwards, upon a bill filed for re-hearing, (3 Hay. 56,) the court, in adjudicating upon 29 Charles II, ch. 3, sec. 10, say “that it comprehends all trusts and all executed uses, no matter whether arising by express declaration or resulting by operation of law.” The case of Shute vs. Harder, 1 Yer. 9, does not overrule but affirms the decision in the case of Russell vs. Stinson. The court there decide that the statute extends to trusts which are raised by or result from a conveyance. In Foote vs. Calvin, 3 John. R. 216, it is held that if A buy land with the money of B, and take the conveyance to himself, he is a trustee for B, and such implied or resulting trust may be proved by parol, and the land may be sold under afi. fa. against B, the cestui que trust.
    
    The conveyance by Harvy Gray to Martin and Clow was after the levy of the execution and after the condemnation of the lot, but before the sale. This conveyance was subject to the lien acquired by the levy of the execution.
    Martin and Clow took the conveyance with notice. First: they purchased pending the suit: Secondly, their answer admits that they heard of complainant’s claim, considered it illegal, and did not hesitate to purchase. Therefore they purchased with actual and constructive notice of the trust and are bound by it, and became themselves ipso facto trustees. I Yer. 296: 3 Yer. 257. All the defendants had notice. The witnesses prove notice on Hodges. Polk’s answer admits he heard of the sale under the order of the circuit court. Murchison took a conveyance from Polk after the commencement of this suit. Notice before the execution of the conveyance is sufficient. Saunders on Uses and Trusts 217, note W, and references.
    
      Strother, for defendants in error.
    It is contended for the defendants that Ephraim Gray had not such an interest in the lot in controversy as is the subject of an execution, (l Yer. I,) and if'hehad, the complainant has not acquired such a specific lien thereon as will authorize this court to divest the defendants of title and vest the same in the complainant, for the reason that he has not shown any deed from the sheriff. The purchaser at execution sale in deraign-ing his title must not only show a judgment and levy but-also a deed from the sheriff. He cannot rely on the sheriff’s return; his title not being created by it, it is immaterial whether there be a correct or any return at all. 8 Yerger’s Rep. 183: 4 Peters’ Con. Rep. 521, and 1 John. Cases, 155.
    If the complainant has not acquired a specific lien by virtue of his judgment and levy this court will not, under the prayer in complainant’s bill, give any relief; for, if it cannot divest the complainant of title, it cannot decree that the lot be sold, or that the deeds to the defendants be cancelled; for where particular and general relief are prayed the latter cannot be more extensive than the former, or different from it. 9 Yer. Rep. 301: 2 Atkins, 141: Story on Eq. Plead. 42.
   Turley, J.

delivered the opinion of the court.

This is a bill filed by the complainant to have his rights to a lot of ground in Portersville, in the county of Tipton, declared, upon the following facts: Ephraim Gray purchased the lot from James Hodges and paid the consideration, and on the 17th day of January, 1832, caused a deed of conveyance therefor to be executed by him to his brother, Harvy Gray, in trust for himself. This trust is not expressed in the deed but is raised by parol proof. On the 14th day of July, 1832, complainant recovered a judgment before a justice of the peace in Tipton county against Ephraim Gray, upon which afieri facias was issued, which was, for want of personal property, levied on the 12th of July, 1833, upon the lot in dispute. The execution and levy were returned to the county court of Tipton, and a regular condemnation pronounced thereon on the 6th of September, 1833, upon which a venditioni exponas was issued and the lot sold on the 1st of March, 1834, to complainant, he being the highest bidder. In the meantime, on the 10th of September, .1833, Harvy Gray sold and conveyed the lot to M. T. Martin and Robert J. Clow, who, on the 5th of May, 1834, re-conveyed the same to James Hodges, who, on the 30th of January, 1835, sold and conveyed to John Polk, from whom Murdoch Murchison purchased on the — day of April, 1835, -taking a bond with covenant for conveyance.

Upon this state of facts two questions are presented for the consideration of the court: first, had Ephraim Gray such interest in the lot as was by law subject to execution on the 1st of March, 1834, the date of the sale and purchase under the venditioni exponas issued against him from the county court of Tipton? and secondly, if he had, do the defendants stand in such a position as to protect themselves against the complainant’s rights acquiredby said sale and purchase, and as subsequent purchasers for a valuable consideration without notice? The first proposition involves the question as to whether a resulting trust cam be raised by parol proof, and whether it is subject to execution from a court of law. Upon this proposition we are not left to argumentative induction; the question is settled by authority both in England and the United States so conclusively that it is no longer de-bateable; and however we may regret that trusts which carry an estate from the entire evidence of title have to be sustained by the courts, yet sic ita lex scripta est, and if it be desirable to have 'it changed, it must be done by the legislative department of the State. 1 John. Chan. Rep. 582: 2 John. Chan. Rep. 405: 11 John. Rep. 91: Vernon, 367: 2 Atkins, 159: 4 Cruise, 58-9. And finally and more conclusively upon us, because they are the decisions of our own courts, the cases of Russel and Vance vs. Stinson, 3 Hay. 5: Shute vs. Harder, 1 Yer. 9. Then Ephraim Gray had such interest as was subject to execution; and the complainant is entitled to his relief unless the defendants are protected from his claim as subsequent purchasers without notice.

Upon this proposition it is tobe observed: first, no person is protected as a subsequent purchaser unless either by his plea or answer he shows himself to be such by an explicit averment that he purchased for a valuable consideration, which he had paid without notice, and that he has taken a conveyance of the legal title. See the case of High and Wife vs. Battle and Bradley, 10 Yer. 335. This is not done in this case. And secondly, there is no pretence that the defendants or any of them are such purchasers. The complainant’s execution was levied on the lot on the 26th of July, 1833. Harvy Gray, the trustee, sold and conveyed to Martin and Olow on the 10th September, 1833, before the purchase under the venditioni exponas. They therefore had a constructive notice of complainant’s claim. They conveyed to Hodges on the 5th of May, 1834. But the bill expressly charges that he was cognizant of all the facts and a party to the fraudulent transaction, which by his neglect to answer he has admitted. He conveyed to Polk on the 30th of January, 1835, who in his answer admits that he had heard of the proceedings under the judgment in favor of the complainant. He sold it to Murchison, but has never conveyed the title, having only executed a bond for that purpose. We are therefore of opinion that the complainant purchased the legal title to the premises in dispute, and declare his rights accordingly. But inasmuch as he had no deed from the sheriff of Tipton conveying the title, we leave him to prosecute his remedy for the possession at law when he shall have obtained the conveyance.