Case Name: ELLIS v. LOCKETT, trustee
Court: Supreme Court of Georgia
Jurisdiction: Georgia
Decision Date: 1897-03-29
Citations: 100 Ga. 719
Docket Number: 
Parties: ELLIS v. LOCKETT, trustee.
Judges: All the Justiees emicwrmvg.
Reporter: Georgia Reports
Volume: 100
Pages: 719–732

Head Matter:
ELLIS v. LOCKETT, trustee.
1. Where a suit was brought by a vendor against a vendee for the purchase-money of land of which the defendant was in undisturbed possession under a deed from the plaintiff, and an essential element of a defense which the defendant attempted to set up by special pleas was want of title in the plaintiff at the time such deed was executed, and the pleas in question did not by their allegations affirmatively show such “want of title, there was no error in striking them on demurrer.
2. If in. point of fact it was understood and agreed between the vendor and the vendee that the latter was to receive a title of a particular kind and character, as, for instance, a title which would he pronounced good and “merchantable” by any reputable attorney in a named city, and if the defendant actually purchased upon the faith of representations that the deed in question would operate to pass to him just such a title, which representations proved to be false, pleas attempting to set up a defense based upon these alleged grounds, hut which failed to state them with the requisite clearness and distinctness so as to present issues for determination by a jury, could not he made available to defeat a recovery by the plaintiff— the pleas not otherwise alleging anything showing that the defendant’s title under the deed would not be good.
3. If in the contract between the vendor and the vendee it was stipulated that the deed which the vendee was to receive should' contain a specified warranty, and the latter accepted it and went into possession under it without such warranty, he could not afterwards set up the fact that the deed failed to contain the stipulated warranty, in defense to an action for the purchase-money.
Argued February 25,
Decided March 29, 1897.
Foreclosure of mortgage. Before Judge Felton. Bibb' superior court. 'April term, 1896.
J. W. Lockett, trustee of Fannie Lockett, brought Ms-petition against William Lee Ellis, to foreclose -a mortgage, ruadle to secure ifflie payment of certain promissory note's-given by Ellis fo-r part of the purchase-money of certain realty in tire city of Macon, bought by him from the plaintiff. Ellis filed several pleas which were stricken upon demurrer upon the ground that they set forth no legal issue-upon which the court could pass. They'contained the following allegations:
At the 'time and before he 'bought the land in question.' and paid a part of the purchase-money thereon, he asked' plaintiff’s agent and attorney, with whom he was dealing’ and from whom he 'bought the land, as 'to how were tie titles to it; -and said agent -and attorney assured him that 'they were perfectly good and straight, that there was no need. for him to employ an 'attorney to examine them, as he could assure him that they were all right. Acting entirely upon, these representations and assurances from said agent and attorney, he bought said lands, paid said agent and attorney $2,500 cash, and delivered to him the mortgage and notes,, without having the title examined. These representations; and assurances induced him to believe that said agent and attorney had examined the titles, and this was known to said agent and attorney at the time. But for these assurances and statements, he would have and intended to have-the title examined by some attorney. He is not -an attorney,, and is not capable of examining the titles to a piece -of land, so as to tell whether they are good -or defective; and thia fact was known to plaintiff, his agent and attorney, at the time. Said statement, representation and -assurance were-made by said agent and attorney, as defendant believes,, recklessly and without -examination of said title, and with, knowledge of the confidence that defendant had in him, in his great legal ability, knowledge and opinion as to the titles; defendant believing at the time from said assurances and statements that said -agent and -attorney had fully and carefully examined the titles to the land and was 'thoroughly familiar with the same, and that said title was perfectly regular and straight in -every particular on the records of said county. He has always had the greatest confidence in said agent and attorney, and in his legal ability and opinion; and it was solely upon his said representations, acting as agent and attorney of plaintiff, that 'defendant bought the property for the full and fair price -of $11,500, paid the $2,500, ’and gave the notes; and by these statements and assurances of said agent and attorney he was dissuaded from having the titles examined -as otherwise he intended and would have done. Very recently he has had said titles examined as f'ar -as the same could be done, and finds the same irregular and defective-on the records of this court; and having had hut very few of the title deeds of said land in his possession, he can only speak of it as it appears on 'the records. It cannot-he traced on the records further hack than a few years; if the chain of title is good and regular, the deeds must have been hidden away, lost or destroyed without being recorded; there is no evidence that said deeds ever had existence at all; the title is clouded, irregular, defective, and one mass of uncertainty and chaos; it would be impossible for him to show any purchaser a clear and undoubted title; had he known or suspected, at the time he was bargaining for the land, that the titles were in the condition in which he has discovered them, he would not have purchased at all; the titles being in such defective condition, the land is thereby rendered unsalable and of little if any market value; .the titles are in the same condition as when he bought the land from said agent and attorney, and being in said condition, defendant is not able to sell the same or to borrow money on it as security; if the land was of value at all at the time he purchased it, it was, by reason of the condition of its titles, several thousand dollars less valuable in its selling and in its borrowing value than $11,500; and had he bought it at all, it would have been at a reduction of several thousand dollars from said sum, -though he asserts and believes he would not have bought it at all, as it would have been >of little-or no value to him, as he could not sell it except on his -own warranty of title, and then only •at a sum very much less than $11,500, and could not have borrowed on it, since no lawyer of reputation and standing -would have recommended and approved the titles. ¡Where the title to a tract or parcel of land situated in the part of Macon where this lot was located, and having on it -as valuable improvements as 'this lot has, is in the condition in which the title to this lot is, it is practically unsalable, and even when it can be sold at all, it will bring only a small part of the amount it should and would bring were the title straight, regular and good on 'the records of deeds in Bibb superior court; and this fact was known to plaintiff, his agent and attorney at the time of the sale of the land to defendant. It is the universally understood rule -among the •attorneys -of Macon who examine titles, that, for a title to real estate of the value and location of said lot to be called .and considered good, the records or original title deeds must .show an unbroken and perfect chain of title from the city of .Macon (this being considered and recognized as the real and true basis or starting point of a good title), or for a period •of forty or more years; and when the title to a piece of real •estate of the value and location of said lot can be traced on .said-records or by the original title deeds for a period of only from fifteen to twenty-five years, unless said title runs into .the city of Macon as the starting point, it is considered and pronounced bad and is rejected; and this fact was known to said agent and attorney at the time he made to defendant said statements and representations from which defendant •■understood that he was buying what was and is understood in Macon as a good and straight title, and wbat any good lawyer in said city would bave so pronounced. He is advised and believes that the order of court, a copy of which is •exhibited, under which the deed from plaintiff to him was made, is defective and illegal, is insufficient to authorize plaintiff to convey to him whatever title plaintiff held at the time, and does not authorize him to make to defendant a ■warranty deed as he did, such being the only kind of deed -defendant would have accepted even were the titles all right. This order of court was got by said agent and attorney before he made to .defendant said statement and assurance which was intended and did cover and exclude [include?] ■said order of court. Plaintiff is not a resident of Georgia; both he and his cestui que trust are residents of the District of 'Columbia; .and though it should be adjudged that ■plaintiff was authorized to bind 'his cestui que trust by the warranty deed so made, yet because of said non-residence it would put defendant to the greatest trouble and inconvenience to sue the trustee and cestui que trust in a dif fersnt part of 'the country, if he should be ousted of the-property aud should have to sue upon a breach of warranty-The trustee amid cesitui que trust ¡have no property other-than this lot in said county.and State, as defendant believes;, neither would a judgment on said breach or warranty,, as he ■ is advised, be good or collectible against them in their place of residence. These facts and circumstances 'and said state- ■ ments, assurances and representations operated upon defendant tas ia legal fraud. He prays tihtait the sale be rescinded and the mortgage and notes be cancelled on his'making to plaintiff a deed without warranty to the land,, which, hie is ready 'and offers to 'do; and that he have judgment against plaintiff for the sum paid by him on the lot,, with interest, less a fair and just rental for the property, and such -accounting as is legal and just in every particular, and. general relief.
Exhibited is an abstract of the title as shown by the records in the office of the clerk of Eibb superior court, viz:. (1) City of Macon to Robert Collins, February 14, 1837;; recorded August 21, 1840. (2) Robert Collins to 'William-Cook (quitclaim), March 1, 1839; recorded August 21,. 1840. (3) Thad Gr. Holt, Jr., to Francis Lake, May 5, 1873; recorded April 3, 1874. (4) Sheriff of Bibb county (for Francis Lake) to Asher Ayers, Jnne 5, 1877; recorded August 7,1877; reciting sale under mortgage fi. fa., but noil. fa. recorded 'with deed, though found by plaintiff since: this suit began. (5) Asher Ayers to J. W. Lockett, trustee, February 2, 1881; recorded February 3, 1881.
From the record exhibited of the proceedings under which ■ the order for sale -o£ the property -was ob+aimed by plainr - tiff, it appears that -on May 30, 1891, he as trustee brought Ibis petition to 'the judge of -tihe superior count of Bibb county, describing the land as in 'the petition in the present case (except that, by seeming clerical error, the word “lot” is used instead of the word “alley” iu one place where • occurs tibe expression, “said alley being ten feet wide-”).. It is further stated in the petition of the trustee, that the lot is the same as was conveyed to the trustee for [by] Asher Ayers on February 2, 1881, and that under the terms of .■said deed the property was held by petitioner under trust for the sole and separate use of Mary B. Lockett, wife of petitioner, now dead and intestate, leaving no debts; that of ■ the two children of the marriage one is dead intestate, and ■the only issue of the marriage uow left is Fannie Lockett, .about 'twenty years of age> the daughter of petitioner; that he has bargained the property to Ellis for $11,500, one fourth -cash and the balance in four annual installments, ■which he is advised is a fair market price for the property; that his daughter will continue her residence with him in "the city of Washington, and it is desirable to sell the prop- ■ erty as she will soon .be of age, when she will desire to come .into actual possession of the proceeds arising from the sale, .lie prays for the appointment of a guardian ad litem for her, to answer under oath as to the advisabilty and justice of the .sale; that she he served with a copy of this petition, with the privilege of acknowledging service thereon; and that thereupon an order be passed authorizing petitioner to sell the ■property at private sale, which can be done upon the trust in which the property is held. Thereupon it was ordered that Fannie Lockett be served or acknowledge service as prayed, and upon such acknowledgment being exhibited to the ■court, that Joseph Bond be appointed guardian ad litem for ,’h.er and make- answer under oath. She thereupon acknowledged service of a copy of the petition, with the further •statement -that, so far as she could do so, she joined in the .said petition and asked that it he granted. Another order, reciting that it appeared that Fannie Lockett had been .served with a copy of the petition, directed that Bond be . appointed guardian ad litem for her and represent -her in this application. The guardian ad litem answered under •oath, that he was familiar with the property, and believed :it for -the best interest of the cestui que trust that the same te sold in tike manner and at the price named in the petition. Thereupon the order prayed for was granted by the-court, with direction that -the trustee make bond for titles, to the purchaser, or execute title to him and take mortgage-for the balance of'purchase-money after the cash payment,, as should seem best for the 'trust estate, holding the proceeds, subject to the same trusts; and that he make report of the-same as required by ’act of 1887. On January 4, 1892' (which is '.the date of defendant’s mortgage to plaintiff), the-trustee brought his petition, reciting the passage of the last' mentioned order, and stating that, owing to 'the general, financial depression in the community, he had not been able' to make the sale he had in vieiw when said order was granted,, but that Ellis had agreed that if the terms of said postponed sale were modified as hereafter set forth, he would be ready to conclude the contract o-f sale instante. It was prayed', that said terms he so modified that petitioner could sell to< Ellas the property on torras of $2,500.00 cash and the balance in four installments falling due three, four, five and* six years after date, and bearing interest, a deed to be made-to him, .and said four installments to be secured by notes' and mortgage; it being greatly to the benefit of the cestui.-, qne trust that the order be so modified. Accompanying-this petition was an -affidavit of Bond, the guardian ad litem, of Eannie Lockett, that he had read the petition for modification of the order of sale, and that he was advised and' believed, and stated on -oath, that the modification as prayed' for would be for the best interest of Fannie Lockett; -and', he j-oined in 'the prayer for said -order.
Exhibited with one of the amendments to the plea is the-deed from Ayers to Lockett, trustee, which contains the-following words creating the trust: “To have and to hold-, .the -af-oregranted premises to 'the said Jiam.es ~W. Lockett: and his successors, in trust nevertheless for the sole and: separate use of M'ary G. Lockett, wife o-f the said James W. Lockett, for and during her natural life, and after her ■ death to her children hy her present or ¡any future husband, and the representatives of any such children who may ¡have died, -share -and ¡share alike, the representatives of children taking the interest of their deceased parent; with power to the said Mary G. Lockett, if she shall die without children or ¡the representatives of children living at her death, to dis- ■ pose of the ¡salid prlo-perty hy will; and with power also to the said Mary G. Lockett by writing under her hand to empower the said James W. Lockett, without an order of court, to sell any part or the whole of stód trust estele, and to- reinvest the -proceeds in such other property, subject to the above described trusts, as he and she shall deem most for the interest of her trust estate; and to appoint another trustee instead of the said James W. Lockett, whenever for any cause he shall -cease to represent said trust; said trustee so appointed by her taking th-e said estate subject to the trusts hereinbefore expressed, which are identical with those which are expressed in the deed creating the trust estate represented by the said Lockett, made by L. 1ST. "Whittle and James T. LTigbet, commissioners of the Bond etate, and now of record in the office of the clerk of the superior court of Bibb county.”
Defendant further ¡alleged, hy ¡amendments to- his plea, that plaintiff, his agent and attorney, knew before and at the time of 'the trade for ¡the property that defendant was contracting f-or -and would no't have accepted .any but a warranty deed to the premises, with covenant of warranty legally binding on ¡the ¡cestui que trust and the trust estate, as shown by the deed itself made by the trustee to defendant. The trustee was not authorized, either by the orders of ¡the court or hy 'the -terms of the trust and 'his powers under the trust deed, to make to defendant a covenant of warranty binding the cestui quo trust, and defendant did not know this at -the time, hut relied entirely and -absolutely upon the statement and assurances of said agent and attorney of plaintiff (by whom .the orders of court were drawn and secured) that the title and deeds and power to make said deed in said trustee were all right and straight and absolutely good, and expressed the trade for the property as before set out in the plea. Furthermore, ‘the petition to sell, etc., under which the order of sale was passed, were not legally served on Fannie Lockett, are not binding upon her, and do not give, in connection with said deed, a good title to defendant. He, not being a lawyer, did not know ‘anything about said orders of court, what they should contain, how they should have been served, bow they were legally to be construed, and in fact never saw them until recently. He expected to- employ an attorney to examine the title for him and look into all these matters, but was dissuaded from doing so after the assurances and statements made to him by said agent and attorney, and relied entirely 'and absolutely upon said assurances and statements as to the title being absolutely good and perfect; and it was known to plaintiff and said agent and attorney at the time that he was no lawyer and was incapable of investigating and passing upon suck legal matters, and that he relied upon said agent and attorney’s assurances and statements as to said title, order, etc. About the time the trade for -the property was nearly completed, said agent and attorney stated to defendant 'that the trustee preferred that defendant should take a deed and give a mortgage for the 'balance of 'the purchase money; and defendant, -being entirely ignorant of any legal difference it might make to him whether he took a deed or bond for titles, expecting in good faith to pay the balance of the purchase money, and relying entirely and absolutely on said statement land assurances of the agent and attorney that the title was absolutely straight and good, accepted the deed and executed the mortgage, which but for said statement and assurances he would not have done, at least until he had had the title examined by 'an attorney. -The deed to 'defendant, though executed on Tune 18, 18-91, was not delivered to him until January 4, 1892, nor was the trade completed until that date; the order of count under -which .he bought the land -and gave the mortgage, granted on the .latter date, -is very different from the order under which the •deed was executed, for which reason the deed is defective .and invalid; and this fact was not known to- defendant until recently, long after the making of the deed 'and mortgage. The trastele had n)o authority -to convey the property described in 'the mortgage, and did not by his dteed put the title thereto in defendant, by reason of (the want of authority and power so to do. The trustee did not have authority to bind ■the trust estate or the ciesibui que itruslt by covenant of warranty. It was not until a long time after paying the $2,500 ■•and giving the mortgage that defendant discovered that the •deed from the trustee .did not put the title in defendant, and that 'the trustee did not have .authority to execute a deed with covenant of warranty binding on the trust estate of the cestui que 'trust, or to make ¡him ia deed and title to the property, >and that the title to 'the same had never vested in him; .and had he known said facts 'before he bought the property ¡and before he executed the mortgage and paid the money, he never would have done these things; and these facts were known to plaintiff, his agent .and attorney, at .the time h.6 bought the property and. gave the mortgage, and they constitute a fraud upon defendant for which he is remediless .at law. Lockett is under no bon'd as trustee, was not appointed '.trustee by any court, and became such only by ^reason of the deed from the heirs. He and .his agent and .•attorney knew at the time that defendant was contracting ■for, and would not have bargained for, bought and accepted .any but a warranty deed and title with covenant of warranty legally binding on the cestui que trust and the trust -estate; and defendant thought he was getting the same, relying as he did upon said assurances of the agent and attorney.
Ryctils '& ‘Stone, for plaintiff in error.
'Hard&mm, Davis '& Turner, contra.

Opinion:
Cobb, Justice.
1. 'When a Tendee seeks to avoid the payment of the-purchase money of land in defense -to a suit brought by the-vendor agaiuslt him, on the ground that the vendor had no title at the time the deed was executed, and where the vendee is in undisputed possession under such deed, it is encumibenit upon him in his plea to set up such facts as would show -that the vendor ihlad no title. If there are several, ways in which the venidtor's titile ibo the premises could have-been acquired, a plea of want of title in defense to a suit for the purchase money would be fatally defective, if it failed, to negative every fact which would be consistent with title-in the vendor. The vendor might have title by a chain beginning with a grant'from the State; or where the- title; originates -with a municipal corporation, by a chain beginning with that corporation; or a title by possession and prescription. Therefore where -the vendee pleads want of title,, ho must show, -mat only that his vendor did moit have a complete paper title, hut he must negative facts which would show title by prescription. In this case one of the defendant's pleas setting up want of title shows that the vendor-did not have a complete chain of title, either from the State, or from the city of Macon, hut did show conveyances, to tire vendor and his predecessors in title extending hack •to May 5, 1873. The plea did not allege that the vendor- and his jtredecessors in title were not in iiossession under these deeds; and as possession consistent with them for the period between 'the date of the sale 'and May 5, 1873, would have made a good prescriptive title in the vendor, a plea failing to negative this fact was defective, and properly stricken on demurrer.
2. In the sale of land it is competent for the parties io< contract for a title of a particular kind and character, although a title of a different character would be, under the. law, good. In the absence of a stipulation for a particular-kind and character of title, a good title, under the law, would be held to be all that was contemplated hy the parties to the-contract. -But if the parties stipulate for a title of a. different kind, then 'they are bound by their stipulation, but it must clearly appear from the contract in what respect, the title contracted for -differs in kind and character from, that considered good raider the 1-aw. Therefore, it would be perfectly competent for (the vendor ¡and ¡the vendee to -stipulate that the title of the vendor should be such as-would be pronounced good and merchantable by any reputable attorney in ¡a named city. If the vendor or 'bis agent-represented at the time of the negotiation that the title would be -of this -character, -or knew that the vendee was intending to purchase only upon condition that the title w-as of this-character, ¡then a failure to give to ¡the vendee- a title -of the-kind -and character contracted for would be a defense to a suit for the purchase money. The pleas in this case fail tosho-w that there was an express stipulation between ¡the vendor's agent and ¡the vendee for ¡a -title ¡other than one which would be considered go-od land sufficient (in law; -and they further fail -to show with sufficient clearness that the vendee.intended to purchase only upon condition that a particular-kind and character of title would be given, and that this-intention was known to the vendor's agent so as to become a part of the contract. There was no error in striking the-plea on demurrer, as the same did not allege anything which, would show that the defendant's title would not be good, under the law.
3. The character of wia-rranlty which the vendor would give to the vend-ee in the sale of land is a matter purely f or stipulation, and if 'the vendor agrees at the time -of ithe purchase to deliver to the vendee a deed which contains a warranty ¡of a specified character, -then a failure to give the¡ warranty would be a sufficient reason for 'the vendee to refuse to receive the deed; but where it appears from the allegations in the plea setting up a failure -on the part of the-vendor to comply with his contract as to- the warranty agreed-. to be given, .that tbe vendee accepted tbe deed with the warranty different from that which had been agreed upon, and went into possession, he could not afterwards, when sued for the purchase money, set up -the fact that the deed failed to contain the warranty which -had been contracted for. His acceptance of the deed and the possession under it would .amount to a waiver of his right to complain in regard to this matter. While in this case it is probable that the warranty .-stipulated for, that is, one by the trustee which would bind the trust estate, could not be legally given, still as the vendee .accepted the -deed without the warranty, it is not necessary to decide the question as to whether a trustee can bind the trust estate by a covenant of warranty. He certainly cannot, without au order from the judge of the superior court
.authorizing it. Shacklett v. Ransom, 54 Ga. 350, 353.
Jlodgment -affirmed.
All the Justiees emicwrmvg.