Case ID: serg-rawl_9/html/0397-01.html
Source: Caselaw Access Project
Author: {"author": "Tilghman, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

[Lancaster,
    May, 19, 1823.]
    AUWERTER against MATHIOT, Sheriff
    IN ERROR.
    The judgment creditors of a vendee of land who has paid part of the purchase money and has possession of the land, but has received no deed, are entitled to the-proceeds of sale of his title under an execution, in preference to the vendor.
    A sheriff’s sale may be set aside, where the purchaser may be injured in consequence of a’misapprehension of the terms of sale, occasioned by the act of the sheriff
    Error to the District Court for the city and county oí Lancaster, in a suit brought by Leonard Jluwerter, against John Mathiot, sheriff of that county, to recover certain monies in his hands arising out of a sheriff’s sale made by him of the property of William Lytle. On the trial of the cause in the court below, a verdict was given for the plaintiff, subject to the opinion of the court on a case stated in the nature of a special verdict.
    The following opinion of the president of the court below which contains the principal facts, was filed of record and was now brought up by writ of error.
    Judgments were obtained in the Court of Common Pleas of this county, against William, Lytle,
    
    By J. Griffith, for the sum of $ 550 48
    do. do. do. - - • - - 1100 00
    By M. Mussleman, for 'the sum of - - - 309 89
    And by L. Jluwerter, for - . - 1906 96
    Amounting in the whole to the sum of - - - $ 3867 33
    At the time of these judgments, W. Lytle was in possession of a tract.of land, which he purchased of one John Barkman. The contract of purchase was by parol, for the sum of 12,348 dollars. About 6000 dollars of the purchase money was paid to Barkman, and possession of the premises was delivered to Lytle, who- continued therein, but no deed was then executed, and the balance of Ihe purchase money is unpaid, and Barkman retains the legal title. So that Lytle had an equitable title only, but would have a right to call for the legal title upon payment of the remainder of the purchase money.
    To November Term, 1816, Lytle brought his action against Barkman upon his contract, which went to an arbitration; and on the 17th of January, 1817, the arbitrators filed their report, awarding that there was due to the defendant from the plaintiff, for the purchase money, the sum of 6530 dollars 47 cents to be paid on the defendant’s making a clear and indisputable title to the plaintiff, free of incumbrances, for the premises sold to Lytle, by the said parol bargain and sale. On the 25th of April, 1817, after this award, Barkman executed and tendered to Lytle, a deed for the premises with a general warranty; and demanded the balanceof the. purchase money, but it was not paid. There was an existing mortgage on the premises from Barkman to the executors of William Bullen, dated on the 13th,of April, 1805, for the payment of 121000, which was assigned on the 13th of August, 1812, to George Ellmaker, who on the 13th of April, 1817, assigned it to George and William Eckert. George Eckert, who was present at the tender of the deed, offered to release the mortgage on his receiving the amount due thereon, though the exact sum did not appear, out of the purchase money due to Barkman.
    
    In November Term, 1816, a suit was entered in the name of William Powers, jun. for the use of William Eckert, against Wm. Lytle and Reuben Marsh, which was referred before the return of the writ, and an award was filed and judgment thereon for the sum of #581 90. On the 11th October, 1816, upon the execution issued in this last mentioned suit, the sheriff, the defendant in this suit, on the 31st July, 1819, sold the land in possession of Lytle, and all his estate and interest therein for the sum of 5902 dollars, and the purchaser on that day signed the conditions of sale, which are referred to and made part of this case, for the greater certainty as to the terms'thereof. ()
    The sheriff executed his deed to the purchaser for the premises sold, which vyas acknowledged in the Court of Common Pleas, on the 26th of April, 1820, and delivered to the purchaser, who paid the purchase money, which is admitted to.be in the .hands of the sheriff, the now defendant.,() There are different claims to the proceeds of this sale, the judgment creditors contend that they Must be appropriated to their judgments, as far as they go; John Barkman claims it by virtue of his lien, and contends that the general judgment creditors can take nothing till he is satisfied for the balance of his purchase money, which is a specific lien on the land; that he is entitled to the preference, and'that his estate cannot be taken to pay the debts of William Lytle. This question is, therefore, distinctly raised by the case stated, anddf Bark-man is entitled to'the priority, his claim takes the whole money, and the judgment creditor getno-hing, and the plaintiffs in this suit must fail. But if Barkman be not entitled to have his claims satisfied out of the proceeds of sale then the claim of the plaintiff is covered by the amount of sales in the sheriff’s hands, and the verdict must stand. '
    The case has be argued on both sides, with great ability, and' I have given to it all the consideration in my power; and have struggled, if possible, to find a doubt, or difficulty. But I have not been able, with all the assistance of the arguments, to start a point, to create any hesitation as to the law of the case, and my opinion is clear and decided. ■ , •
    That John Barkman has a lien on the premises for his unpaid purchase money is without doubt; and that lien will follow the land into whose possession soever it may come; and a purchaser from Lytle, either directly or by operation of law, will hold subject to the same lien. Barkman has retained the legal title; and it is a principle, that where a subsequent purchaser acquires a mere equitable interest, he is not entitled to notice of the lien of the original vendor;, he must look to the interest he acquires; and if he finds no legal-conveyance of the land, he cannot set up the want of notice of the lien on the land for the original purchase money. As this ease is,- therefore, it. is clear of all the litigated questions- on the subject of lien, which have agitated the courts of late years, b'ut depends on first principles. It is not necessary to say'more upon it, or to enter-into a consideration of the cases on this very important subject. But Lytle has also a lien, so far as he has paid money on his contract, in case a. proper title be not made to him. And in this respect,'the right is reciprocal, and I incline to think; though it is not necessary to decide, that in this case a'judgment against Barkman, after the contract, and possession delivered to Lytle, would affect the land no further than to the extent of the purchase money unpaid; Barkman being a trustee for him, holding the legal title as a security for what may not be paid. Lytle, has, therefore, an equitable interest in the land, he paid a large sum of money on account, and had the possession. This is such an interest as by the law of Penny sliiania can bé taken in execution and sold. It is entirely distinct from the claim or lien of Barkman, ‘which cannot be prejudiced. . His lien affects the whole land and surmounts the mere equitable interest, which his general creditors have a right to, placing themselves in the situation of the vendee, with the right to call for the title, on payment of the balance of the purchase money.
    The purchaser at sheriff’s sale purchased only the title of the debtor, whatever it may be. If he has but an'equity, the purchaser acquires no more; he cannot raise himself higher than the debtor, and he must abide by the situation in which the debtor himself stood. If his title was defective the title of the purchaser.can be no stronger. The sheriff sells the interest of. the debtor in the execution, whatever that may be. He does not stipulate for the soundness of the title. The purchaser must take that at his risque, and so it'has been universally understood. He therefore does not sell out and put, as has been contended. He sells by authority of law, and cannot go beyond his power .or undertake to give a better title than the defendant in the execution himself had. He could not therefore sell or affect Barkman’s interest. Barkman was neither party nor privy; his interest was paramount, and could not be prejudiced. He shall not, therefore, interfere with the creditors claiming merely a lien-upon the equitable interest of Lytle, distinct from the legal title to the land which Barkman retained as a security for his contract.
    There is no analogy between this claim and the lein of a judgment. It is a.real interest in the land, a chai’ge upon which descends, and is assigned with it. The equitable owner has a distinct interest, which may be followed'by his creditors, who may take it in execution, and sell it; but they can only sell it Subject to this charge. The interest of the original vendor cannot be affected, tie sustains no injury by such sale, nor shall he take any benefit from the proceeds.' Thé verdict is to stand arid judgment is to be entered for the plaintiff.
    It was now assigned, for error in this opinion, that the court below erred, ' '
    ■ 1st. In not extending to the purchaser the legal and equitable protection of having the purchase money applied to discharge the liens and incumbrances against the estate purchased.
    2d. In not declaring the mortgage to William Butler transferred to EUmak'er and by him to-the Messrs. Eckerts, entitled to be paid out of the purchase money, in preference to any of William Lytle’s judgment creditors.
    Sd. In not declaring the judgment creditors of John Barkman, which bound his interest in this land, in the hands of Lytle, entitled to a preference over the judgment creditors of William Lytle.
    
    4th. In not declaring that John Barkman’s judgment for the balance of the original purchase money, due to him from Lytle for the lands since sold by the sheriff, which was secured by the legal or equitable title being retained by Barkman, was entitled to be paid in preference to Lytle’s judgment creditors.
    The case was argued by Rodgers and Hopkins, for the plaintiff in error; and by Buchanan, contra.
    
      
      For the defendant,
    
    it was contended, that on the day of sale, Lytle had the possession and an equitable, title; a right to the legal title, on payment of the 'residue of the purchase money. Bark-man had the legal title, subject to be divested on payment of the purchase money. The proceeds of sale of Lytle's interest in the land ought to be applied to the discharge of liens upon his property, held by his creditors, and not to other persons, in the situation of Barkman and his creditors. The latter have no claim to this money. Lytle had an interest subject to execution and sale by the sheriff, and the purchaser, according to the conditions of sale, bought all his interest, but the sale had no effect on Barkman1 s title. That 'remained, and he might sustain ejectment for the land. 1 Yeates, 12, 393. Irvine v. Campbell, 6 Binn. 11S. 4 Johns. 21C. The purchaser cannot complain, for he buys at sheriff’s sale, at his own risk. • 5 Serg. & Ilawle, 223. A prior mortgage is not affected by a subsequent judgment, and execution, and sale, by the sheriff. Febiger v. Craighead, 4 Dali. 151. 2 Yeates, 42. He need not take the money from the sheriff. It could not be that he. could take his balance of purchase money out of this fund, or not, at his pleasure.
    
      For the plaintiff,
    
    it was said, that Barkman, or his mortgagee were entitled. Lytle became, from the time of sale, the owner of the land, and Barkman had’ only an equitable lien, by virtue of which.he had a right to demand the money of the sheriff. The debt of Barkman constituted an equitable incumbrance, and equitable incumbrances are paid according Lo priority. 1 Fonb. 310. This court has exercised the power of appropriating the money arising from sales made by sheriffs. Patterson v. Sample, ’4 Yeates, 315. In the Bank of North America v. Fitzsimmons, 3 Binn. 358, the Chief Justice says, that “it has been a practice of long standing in this state, when the sheriff .sells land by virtue of an execution, to sell it for its full value, without regard to the lien of judgments, and to apply the purchase money to .the discharge of those liens, according to their order.” It is of great importance that lands sold by the sheriff should bring their full value, which' cannot be unless the purchase money be applied to payoff incumbran-ces of every sort. The intent of the sale, in this case, was, that the full value should be paid, and the money applied to pay incum-brances of every kind in their order, according to the practice, and the legal policy of Pennsylvania, since the act of 1700, 1- Sm. Laws, 7, and it was so understood by the purchaser. It will be a surprise upon him if he does not obtain a clear title. If Bark- . man’s claim is a lien,‘why should it .not be paid as well as a prior judgment or mortgage? It is in nature of a mortgage. In Le-vinz v. Will, 1 Dali. 430, the proceeds of sale were applied to the mortgagee holding an unrecorded mortgage. In Petry v, Beauvar-let, 1 Binn: 97, the court allowed the sheriff poundage on money paid on account of a prior mortgage. As soon as the agreement of sale was made, the vendee became a trustee for the vendor for the purchase money. Sudg. 130. Pow.on Cont. 56 to 59. Bark-man is a judgment creditor for this very money: and though his judgment was subject to Jdxiwerter’s, it binds from the time the lien accrued, namely, the time of the agreement to sell. It is not merged in tire judgment. Bantleon v. Smith, 3 Binn. 146. Gordon v. Correy, 5 Binn. 553. At all events, the mortgagee of Bark-man had a right to payment out of the money. His was the oldest incumbrance. And as Barkman has paid this mortgage by a sale of his other property, he has a right to take the place of the mortgagee, and come in to indemnify himself, on the fund in the sheriff’s hands.
   The opinion of the court was delivered by

Tilghman, C. J.

The judgment of the court below, in this cause, was given upon a case stated, which may be explained in a few words. William Lytle made a parol contract for the purchase of a tract of land of John Barkman, for the sum of 12,348 dollars. He paid about 6000 dollars of the purchase money to Barkman, who delivered him the possession, but did not make a conveyance of the land. While Lytle was in possession several of his creditors obtained judgments against him, on one of which judgments execution was issued, and all his right to this land sold by John Mathiot, the defendant, sheriff of Lancaster county, for the sum of 5202 dollars. This money was received by the defendant and is still in his hands. It is claimed by John Barkman, for the balance of the purchase money due to him from Lytle, and it is also claimed by the judgment creditors of William Lytle, who contend that they had a lien on the estate of Lytle, of whatever nature it might, be. The question is, which of tbcso claimants are entitled to the money. If the judgment creditors are entitled, then the judgment of the District Court is to be affirmed; but if Barkman has a better right, the judgment must be reversed.

By the law of Pennsylvania all the real estate of the debtor, whether legal or equitable, is bound by a judgment against him,, and may be taken in exece- ion ami sold for the satisfaction of the debt. At common law, an equitable estate is not bound by a judgment or subject to an execution. But the creditor may have relief in chancery. We have no Court of Chancery, and have therefore from necessity established u as a principle, that both judgments and execution have an immediate operation on equitable estates. We must consider then, what, was the nature of William Lytle’s estate in the land sold by the sheriff. It is very clear that he had only an equitable estate. The legal estate remained in John Bark-man, who had a right to retain it, until he received full payment of the purchase money. On the other hand, Lytle had a right to call for a conveyance on payment of the balance of the purchase mo- • ney. The judgment creditors of Lytle had a lien on his estate such as it was. Arid when the sheriff sold the estate of Lytle he sold it such as it was; that is to say, a right to demand a conveyance of the legal estate from Barkman, upon payment of the balance of the purchase money due from Lytle. Of the right of Barkman, the purchaser from the sheriff was bound to tafee notice at his peril. If he examined the title he would find tiiat. Lytle had not the legal estate; and if he did not examine it, the fault was his own. The sheriff had no authority to sell the estate of Barkman, nor-could he in any manner affect it. The process by virtue of'which he sold, commanded him to sell the estate of Lytle. It being the estate of Lytle then which was sold, the proceeds of sale belong to those creditors of Lytle who had a lien on his estate. The interest of Barkman was distinct from the interest of Lylle. Bark-man had no concern either in the sheriff’s sale, or the proceeds of sale. He retained the legal title, and might recover in an ejectment against the purchaser at the sheriff’s sale, who stood in the place of Lytle, so far as concerned the title to the land. The case of Lytle was altogether different from that of a man seised of a legal estate in fee, subject to the incumbrance of judgments,-&c. There, when the sheriff sells, he sells the legal estate, and it- has been the custom to apply the proceeds of salé to the discharge of the incumbrances according to their priority. But inasmuch as Lytle had not the legal estate, the proceeds of sale were applicable lo the discharge of the incumbrances on his equitable estate. .This equitable estate must be supposed to be valuable; for Lyle had paid about 6000 dollars for it. His judgment creditors therefore had a lien on something substantial. But according to the doctrine contended for by the defendant’s counsel, the judgment creditors lose every thing, and the purchaser at the sheriff’s sale gets the legal title for nothing. The purchaser, who bought only an equitable title, is to apply his money in the first place to the payment of the balance due to the holder of the legal title, which he did not buy, and thus he will obtain a complete title, both legal and equitable, and the judgment creditors of Lytle will get nothing. A principle which leads to such a result must certainly be unsound. But it has been said, that as it is the custom in Pennsylvania, to permit the purchaser at sheriff’s sales, to apply the money to the discharge of incumbrance, and thus obtain a clear title, the purchaser in the present instance supposed, that he was to have the same privilege, and will be very much injured if it be denied to him. To this it may be answered, that the purchasers at those sales buy at their own peril. There is uo Warranty of title, and therefore it is, that the property generally goes off at a price far below its value. Ne- ' vertheless there may be cases, where under a misapprehension of the terms of sale, the purchaser may be so much injured, that it would be unjust to hold him to his bargain. For instance, if in the very casé before us, the sheriff-had given cause to suppose, that the purchaser was to have a complete legal title, and on that presumption he'had bid the full value of the clear legal estate, it would be very hard that after paying his money, he should have to buy the legal title over again. But it was his business to inquire into that matter before the money was paid, and had he brought such a case as I have mentioned, before the court, he would probably have been discharged from the purchase, and a new sale ordered. But there is no such question now for "consideration. The case presented to us, is that of a man who purchased only an equitable estate, and we are to decide who is entitled to the purchase money. The answer is plain, those are entitled who had liens on the equitable estate. As the principle involved in this case is important, I have given it full consideration. I can see no ground on which John Barkman’s claim to the money in the hands of the defendant can be supported. It follows, that it must belong to the judgment creditors of Lytle. I am therefore of opinion that the judgment of the District Court should be affirmed.

Judgment affirmed.