Court Opinion

ID: 6687994
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:34:32.79198+00
Date Added: 2024-06-11T16:01:01.347353
License: Public Domain

WHITING, J.
(dissenting). While I agree with many things announced in the foregoing opinion, yet it seems to me that my colleague has, at several points in his discussion, started from false premises, and that, as a result, he has reached conclusions, some of which, while correct, rest upon reasons other than those advanced, others of which, and particularly the ultimate conclusion, being erroneous.
'I had supposed all would agree that there was not within this state a thing — real, personal, or mixed — the subject of prop*129erty in and to which there was not at all times- vested somewhere a title known as “legal/1 carrying with it an interest in such property known as the “legal estate.” I had also, -supposed that such “legal estate” — whether it be -the estate known as the fee simple, or whether if be one of the least known to the law, whether it be one in possession or one in expectancy, whether it be vested in one or in many persons, whether it may have had cut out of it and transferred to other owners, lesser legal estates, or whether its ownership may have passed to one holding a larger estate and it thus have become merged in -such larger estate, whether it be incumbered by lien-s or bounden by contracts and agreements conferring upon others- interests 'in or to the subject of property or in or to the said -estate — never ceased to exist except the subject of property itself ceased to exist. My colleague seems to be of fh-e view that there may exist what -is known as- an “equitable estate” of such magnitude and importance that if, for the time at least, absolutely wipes out of existence the so-called legal estate. To such proposition I must dissent, as I believe it to have no support in reason, and surely none in authority. It would seem from reading the foregoing opinion that my colleague has fallen into his error from assuming that there could be no- “estate” held by a person, except it carried with it the right to the present beneficial use of the property. This is certainly error. '
It has well been said- that an “estate” in property “signifies the state, condition, or circumstances in which -the owner stands in regard to his property, and has relation to the quantity or interest which the tenant has therein, and the time at which that quantity or interest is to be enjoyed, as well as the number and connections -of the tenants.” Title is “the lawful cause or ground of possessing that which is- ours. It is that which -is the foundation of ownership of property, real or personal.” Hunt v. Eaton, 55 Mich. 362, 21 N. W. 429. “Title has respect to that which is the subject of ownership, and is that which is the foundation of ownership, and with a change of title the right of property in the owner passes.” Springfield F. & M. Ins. Co. v. Allen, 43 N. Y. 389, 395; 3 Am. Rep. 711. In short, “estate” is that which *130one owns; “title” is that -through and by virtue -of which one acquires -such estate. There is no- property in -this, -state the legal title to which was not originally either in some person or in the United- States- -o-r the state (section- 191, Civ. Code), which legal title vested in its holder the legal estate. T-he only manner in which such legal estate can pass out -of its -original -owner — unless the subject of the estate ceases to exist — -is through -the vesting of the legal title -in some other -party. ' One of the many ways of creating a -legal title and transferring the legal -estate is by the execution and delivery of what is termed -a conveyance. Under the express provisions of the statutes of this state (section 987, Civ. Code), an executory contract for the sale or purchase of land ■is not a “conveyance.” I am unable to understand how1 the legal estate -originally existing can be destroyed by the holder thereof merely executing an instrument not of the dignity of -a conveyance, I will concede that i-t is- within the- power of the people, through statutory -enactment, ’to make of a purported. executory contract for the sale of land a legal conveyance passing the -estate therein described together w-ith the legal title thereto -to the grantee therein named. Warvell-e in his work -on Vendors, at section 400, says: “Estates are classed as legal and equitable, the former being tho-se which have- their -o-rigin -and derive their qualities an-d incidents from the common law, and the latter those w-hdcli are derived from the -rules and principles which prevail in courts of -equity. Formerly every estate was legal in the proper acceptation of that term, and in the contemplation of law there -is and can be but -o-ne estate, which may properly be denominated the legal -estate. But the introduction of what were known as uses, and the -subsequent origination of trusts, where one party held the title but upon some trust or confidence for -another, early led -the- court of chancery to take -cognizance of the rights of the beneficiary, and thus there grew up a -double ownership of lands -tliu-s situated, the .interests which wer-e cognizable as -such only in -a court of equity taking the name of equitable to- -distinguish t-h-em from legal estates.” Thus it -is seen that prior t-o the statute of uses (27 Henry VIII) the cestui que use had no- legal title, and hence no legal estate, in the land; -such title and .estate being in the *131“grantee to use.” The chancellor recognized and enforced the rights of the cestui que use, and his interest under the deeds became known as an equitable estate, exactly as the interest of the vendee under an executory contract for sale is now known and for the same reason, to wit, because it was only in a court of equity 'that such rights or estates were recognized and protected. Then came the statute of uses, declaring that, in case of the ordinary “deed to use,” the title should vest in the cestui que use, thus merging into one the legal and equitable estates, and vesting them so merged in the former holder of the equitable estate. In like manner our lawmakers might enact a law providing that upon the execution of such a contract as the one before us ithe title should pass to the grantee. Such legislation might be wise, but without it the legal title and estate remain with the vendor until he sees fit to execute the deed agreed upon, or until, in case the vendee has done everything required by him under the contract and has thus become vested with the equitable title, a court compels a deed conveying the legal estate to be executed by the vendor or by some party empowered to act for and in the. name of the vendor. It must also be remembered that there is an important 'distinction between title to an equitable interest or estate in a freehold and an equitable title to a freehold. The vendee in an executory contract for the sale of land has the first before a single covenant upon his part has. been performed, but he has not the equitable title to the freehold until he has performed all of his covenants. Warvelle says: “The essential feature of an equitable title is that it is one which appeals to equity for confirmation and enforcement. Hence a mere contract or covenant to convey at a future time on the purchaser performing certain acts does not create an. equitable title. It is only when ithe purchaser performs of tenders, performance of all the acts necessary to entitle him to a deed that he has an equitable title and may compel a conveyance. Prior thereto he has, at best, only a contract for the land when he shall have performed his part of the agreement.” Warvelle on Vendors, § 176.
I concede that the present beneficial use of property cannot be in different persons at • one and the same time where the said *132use rests upon separate and distinct estates, whether such estates be legal or equitable, buifc we should not lose sight of the fact that where, under the provisions of an executory contract for the sale of lands, the vendee is let into1 possession of the premises, such vendee does not hold such possession by virtue of the executory covenants for the sale of the premises, but holds same under and by virtue of an executed agreement or covenant, an agreement that amounts to a conveyance, an agreement that might be enforced in a, court of law as distinguished from a court exercising equitable jurisdiction,' an' agreement that creates a legal title to, and vests in the vendee, a legal estate as tenant at will, i Tiedeman on Real Property, § 2x6; 1 Washburn on Real Property, 622. The executory covenants in the contract before us are what creates the equitable estate, and not the agreement letting the vendee into possession.. Such possession and the agreement therefor vest in the vendee certain legal rights entirely unessential to his equitable estate, and these rights are of a nature that could be enforced in an action at law. The holding of possession by the vendee is under and not adverse to the title and estate of the vendor. Perhaps as clear -a distinction between an execxtted and an executory contract is that given in 9 Cyc. 244, where it is said: “An executed contract of sale is a bargain- and s-ale which has passed the property in the thing sold, while executory contracts -of sale are contracts -as opposed to conveyances and create rights iix personam to- a fulfillment of the terms, instead of rights in rem to an enjoyment of the property passed.” 'It -should be borne in mind that by -abolishing the court -of equity as a separate court and extending its jurisdiction to a court having also the so-called “legal” jurisdiction -w-e have only -changed the identity of the body through which well-recognized remedies may be obtained. Not only have substantive rights been in no manner changed, but the remedies left to- parties- are identically the same ■as before. At the best, the remedies are but more readily obtained in that one court may grant all the- necessary relief. It follows that until the -statutes shall, by express- provisions, -do- away with what are known as “equitable estates” under executory -contracts for sial-e of land by -declaring that such contracts shall carry *133the legal estate and title to the vendee, there must remain in the vendor the legal title and estate.
From what 'has been said .above it follows: That there may be a legal estate existing in a piece of property-without any existing equitable estate therein, but never an equitable estate except there is also a legal estate. Eomeroy in his- great work soys: “An equitable estate, in its very conception, and as a fact, requires the simultaneous existence of two estates or ownerships in the same subject-matter, whether that be real or personal, the one legal, vested in one person, and recognized .only by courts of law; the second equitable, vested in another person, and recognized onfy by courts of equity. These two interests must be separate, and as a rule must be held by .different persons; for, if the legal estate and the equitable estate both become vested in the same person by the same right, then, as a general rule, a merger takes place, and the legal estate alone remains.” i Pomeroy’s Equity Jurisprudence (3d Ed.) § 147. If there is one person vested with the legal freehold estate in a tract of land and another with the equitable freehold estate therein, certainly but one of such parties is competent, as such freeholder, to sign a petition such as the one before us ‘for consideration. It follows that my colleague is in error when he denies that the only thing for our determination is as to which one it is, the legal or equitable estate, the possession of which our lawmakers intended should qualify one to sign such petition. The determination of this question is absolutely unavoidable. My colleague says: “And the true test as to whether an estate is inheritable, -and hence a freehold, does mot depend upon the class of persons who may inherit, but upon the question whether the estate itself is capable of passing by inheritance.” With such proposition I must tal^e issue. Whether or not an estate is a freehold does not and never did depend upon its inheritable quality. My colleague has cited State v. Kokomo, 108 Ind. 76, 8 N. E. 718. A reading of the same will reveal that it has no bearing whatsoever upon the proposition in support of which it is cited. Originally at common law no. life estate was inheritable, yet it was a freehold estate. Today, under our statutes, any estate, whether in real or personal property, will pass by in*134■heritance providing the estate is of a nature to- survive the death -of tlie holder thereof, and yet -the freehold estate of - today includes, as at common law, only fees (base- and s-imple) and life estates. The basis- for the cl'a-ssificati-o-n of estates- into those of freehold and th-os-e not is clearly shown by the -definition, of “freehold” in Bl-ack’s- Law Disti-onary: “An estate in land or other real property of-uncertain -duration; that is, either of inheritance or which may possibly last for the life of the tenant at least (as distinguished from a leasehold), and held by a fr-ee tenure (as distinguished from a copyhold or villenage).” If by statute tomorrow all estates, even fee simple, became uninheritable, the fees and life estates w-o-uld still remain freeholds as the quality (of uncertain duration) that makes th-em freeholds w-oul-d s'till remain. There can- be no- question but that under the contract in question Hjdgeson acquired an equitable estate in the freehold, that such estate is inheritable, being made so by statute, but that it -is a freehold for reasons separate and distinct from the quality of inheritabiliity.
My colleague -discussed, to considerable extent, - the rule of equitable conversion, and I fully agree with what he says in relation thereto, except as -to- -its bearing upon the question before us. Yv i-th this p-art of his opinion I am unable to agree, -as- it seems to me the question of equitable conversion has -absolutely no bearing thereon. The necessary result of the majority opinion herein is to render the vendee under a purely -executory contract a competent signer of one of these petitions, though, under our statute, his contract is not a conveyance and is not protected by our recording acts. Applying it -to -case at bar, it would result in holding Helges-on a qualified -s-igner if his contract had been purely executory in all its terms and no possession given thereunder. I cannot subscribe to any holding that mus-t bring such a result, where there is nothing in the wording -o-f the statute to warrant it. Let u.s recognize the legal estate as the -o-ne which qualifies its holder to do- whatever the statute may empower the holder of an estate -to do, and not resort to- the doctrine of equitable -conversion in order to qualify a party to perform an- act pertaining ■to citizenship. When -parties enter -into a contract for .the sale *135of land, they, by their contract, allow- the legal estate to remain in the vendor, and at best vest but a mere equtable estate in the vendee. The equitable estate may never ripen into' a legal estate and tíre legal estate miay never pass from the present holder thereof. The legal estate may always remain greater -in value ■than the equitable estate which may be and may always remain merely nominal in value, or such legal estate may gradually dwindle until it is merely nominal in value 'and the beneficial interest pass -almost entirely to the holder of the equitable estate, but so long as, under their contract, the legal estate is by right vested in the actual holder thereof, .tire other party can have no claim for the same and cam acquire no right dependent thereon. It i-s for this court merely to determine whether the Legislature -intended the owner -of the legal estate to be the signer of a petition or the owner of the equitable estate. It cannot be both, and we are not at liberty to, and the Legislature certainly did not intend to, invest any person or tribunal with power to, -in each case, malee an inquiry -into the relative values of the two estates and grant the right of petition to the holder of the estate greater in- value, nor -to the party in possession, who- might perchance be some party other than the holder of either the legal or equitable freehold. It would s-eem that there is no escape from' the conclusion that the person who holds or is fully entitled to be vested with -the legal freehold estate is the proper signer of a petition, and that nothing short thereof is sufficient to qualify him as such signer.
The first two cases below hold that, where one is the real owner of the legal title, he will be treated- as a freeholder, though some one else holds 'the naked legal .title for him. It was held in Twp. of Bernans v. Twp. of Warren, 15 N. J. Law, 447, that, where a freehold estate in land i-s conveyed by A. to C. in trust for B. during the term of bis life and from and after his dpath to his wife and then to his heirs, B. was. seized of a freehold estate sufficient -to give him a settlement in the county where land was situate, there being a statute establishing a settlement in a party holding a freehold estate in land. It was held in Goodwin v. Bd. of Ed., 38 Mich. 95, that “a person for whose sole benefit an undivided interest in fee' is held- by another in trust absolute *136■appearing on the conveyance is a freeholder.” In the case of People v. Hynds, 30 N. Y. 470, the writer of the opinion 'held- that ■a contract for the conveyance of a freehold interest in land upon the payment of certain sums covenanted to be paid under said contract did not make the holder of the equitable interest a freeholder, the justice saying: “He had an equitable title which might perhaps be converted into a legal title. The statute, by freeholders, means such as 'have -the legal title to- real estate, such as are freeholders without a proceeding in court to make or entitle them so.” It is true that in this case the justice based- his decision up-on -other grounds as well ás the fact that the vendee in the contract was not a freeholder, and that the other ju-dges concurred in the decision upon one of the other grounds. In the case of of Commonwealth v. Reynolds, 31 Va. 663, the- question now before us wa-s squarely before the court, -and was passer upon. The statute of Virginia provided that a person must be a freeholder to qualify him as a grand juryman. It appears that one Smith, the 'holder of a freehold estate in- land, had covenanted to convey this land to Monroe upon Monroe’s performing certain ■covenants upon his part, but it does not appear that Smith had actually conveyed the land or that Monroe was yet vested with an equitable title; that is, that he was yet entitled under the contract to demand a conveyance thereof. The court hel-d that Smith, under the above circumstances, wa-s a proper juryman. It must therefore follow that M-onroe would- not have been one; and that, as applied to the facts in this case, Dillman, if a voter, would have been a proper petitioner and that Helgeso-n wa-s not.
No state has gone farther in recognizing the doctrine of equitable conversion, -as applied to- the administration and -distribution of estates, both in legislative enactments and in the decisions--of its courts- than- has the state of Nebraska. See Cutler v. Meeker, 71 Neb. 732, 99 N. W. 514, 8 Ann. Cas. 951; Hovorka v. Havlik, 68 Neb. 19, 93 N. W. 990, 110 Am. St. Rep. 387. In the Hovorka Case the court calls attention to their statutes similar ¡to statutes found in our Probate Code. My colleague finds nothing in the ca-se of In re Cohn, 84 Neb. 230, 121 N. W. 107, conflicting with his views, and holds, -that -there is nothing in Judge *137Holcomb’s definition- of freeholder inconsistent therewith. Granting that Judge Holcomb’s words define a freeholder whether legal or equitable, certainly it must be conceded that -the court, in its decision in the Cohn Case, was not applying the doctrine of- equitable conversion to -the executory contracts before it in that case, where in holding -that the vendees thereunder were not freeholders it says: “The holdings in this -state are not in entire harmony as to the meaning of the term as used in -difieren! statutes; but we are not -aware of any decision to the effect that persons having less than a title to- land are competent signers of a petition for liquor license. * * * Hence the use of the words ‘resident freeholders’ which must be construed to mean those living within the 'subdivision- holding title to- real estate.” Any person reading th-e above decision in full cannot fail to- understand that by the use of the word “title,” as above quoted, such court had reference to the “legal title.” The contracts construed in that case were not mere options, but clearly the -ordinary contracts for the -sale of real estate and were of the class of contracts to which the doctrine- of equitable conversion might apply. As stated in -such opinion, they were contracts wherein one party -agreed to sell lands to another f-or a certain consideration, part of which was paid, the other payment to become due in- one, -two, and three years thereafter, there being the common provision that time should be of the essence of the contract, and that failure to pay s-ho-ulcl work a forfeiture -of the contract. It was covenanted therein that, “in consideration of the -stipulations herein contained and the payments to be made as hereinafter specified, the party of the first part agrees to sell- unto the party of the second part. * * *”
Certainly the above holdings are -directly' applicable- to the facts in this case, and, if we h-o-ld Helgeso-n to be a lawful petitioner, we can find no -support except in the -one Texas case (Hannah v. Shepherd [Tex. Civ. App.] 25 S. W. 137), an. examination of -which -shows a m-ere statement of a conclusion arrived -at without any attempt to support the same by reason or authority.