Court Opinion

ID: 6539815
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:14:41.01338+00
Date Added: 2024-06-11T15:55:47.297606
License: Public Domain

G-Regg, J. and 'Whytock, (Special J.) dissenting, say: There are several important questions in this case, the most difficult of which seem to arise upon a construction of the deed from Payne and Robinson to Sheppard, (except detailed descriptions of property, not necessary to a clear understanding and proper construction of the deed), it is as follows, to-wit: “Know all men by these presents that we, James B. Payne and Elizabeth Robinson, in consideration of the sum of thirty thousand dollars, to us in hand paid by James Sheppard, and of the further sum of eighty-six thousand one hundred and forty dollars to be paid to us by the said James Sheppard, in five equal annual installments, to wit: the sum of seventeen thousand two hundred and twenty-eight dollars on the first day of February, 1862, the like sum of seventeen thousand two hundred and twenty-eight dollars on the first day of February, 1863, the like sum of seventeen thousand two hundred and twenty-eight dollars on the first day of February, 1864, and the residue or like sum of seventeen thousand two hundred and twenty eight dollars on the first day of February, A. D. 1865, all of said installments without interest until maturity, but if not paid at maturity, then to bear interest at the rate of eight per cent per annum from due until paid, payable at the Citizens Bank, in the city of New Orleans, La., in money or New York exchange, with the privilege to the said James Sheppard to pay off the same, or any part thereof, at. any time before maturity, at eight per cent per annum discount, by depositing the money or New York exchange for that purpose in said bank to the credit of the said Payne and Robinson, and the certificate of deposit of said bank therefor, shall be evidence of such payment, according to the tenor and, effect of the five several writings obligatory of the said James Sheppard, of even date herewith, now executed and delivered to us, payable as aforesaid, reference being thereto had will more fully appear, do hereby grant, bargain sell and convey,, unto the said James Sheppard, the following described lands,, negroes.and personal property, situate and being in the county of Jefferson and State of Arkansas, to-wit: The east half of the north east quarter offsection thirty-one, etc. etc., in Township five south of Range eight west, etc., containing together six hundred and twenty acres, (620) more or less, of land, together with all and singular the privileges and appurtenances thereunto in any wise belonging, the same being and constituting the plantation now occupied and cultivated by us, the said Payne and Robinson, and also the following named negro slaves, forty-six in number, now on said plantation, to-wit: Jack, Eloyd, etc. etc., and also the following described personal property, now on said plantation, to-wit: two thousand bushels of corn, five work horses, one saddle horse, seventeen mules, etc., on the place. To have and to hold all and singular the lands, slaves and personal property aforesaid, to the said James Sheppard, his heirs and assigns forever, hereby covenanting with the said James Sheppard, his heirs and assigns, that we the said James Payne and Elizabeth Robinson are lawfully seized in fee,of said land, have a good right to sell and convey the same and that we will, our heirs, executors and administrators shall warrant and defend the title thereto against the lawful claims of all persons, and also that said negroes are all slaves for life, and that we will, our heirs, executors and administrators shall warrant and forever defend the title to said negro slaves, and all and singular the pei’sonal property aforesaid,, unto the said James Sheppard, and his heirs and assigns against the lawful claims and demands of all persons whomsoever, and for the consideration aforesaid, and I, Mary Payne, wife to the ' said James B. Payne, do hereby release and forever quit claim unto said James Sheppard, his heirs and assigns, all my right, claim, or possibility of dower in or out of the aforementioned premises. “Provided ahoays, nevertheless, And that this deed is made upen the condition, that the said James Sheppard shall well ■and truly pay, or cause to he paid, the said sum of eighty-six ■thousand one hundred and forty dollars, purchase money, remaining due and unpaid, as aforesaid, with all interest that may accrue thereon, and according to the tenor and effect of his said several five writings obligatory, therefor, as aforesaid; and furthermore, that the said sum of eighty-six thousand one hundred and forty dollars, purchase money, so remaining due .and unpaid, as aforesaid, together with all interest and costs that may accrue thereon, shall be, and remain a lien on all and singular, the lands, slaves and personalty hereinbefore mentioned and described; and also, on the increase thereof, and all additions that may hereafter he made thereto, until the same shall he fully paid off and discharged, when and whereupon, and not before, this deed shall become absolute and in fee simple forever, and we, the said James B. Payne and Elizabeth Robinson, herein and hereby retaining and reserving our equitable lien, and all and singular the lands, slaves and personalty, with the increase thereof, and all additions that may he made hereafter, thereto, as aforesaid, with the right to subject the same, or any part thereof, to the payment of the said sum of eighty-six thousand and one hundred and forty dollars, purchase money, so remaining due and unpaid, as aforesaid, or any part thereof, as the same may fall due and become payable as aforesaid, and in -default of the payment thereof, or any part thereof, do hereby waive and relinquish all our rights in law or equity to recover the same or any part thereof, of and from any other lands, negroes or property of the said James Sheppard, hut do hereby expressly exempt the same from any liability for the payment of said purchase 'money, so remaining due and unpaid, as aforesaid, and rely entirely on our said lien, for security and payment thereof, as aforesaid. In testimony whereof, we, the said James B. Payne, and Mary, his wife, and Elizabeth H. Robinson, have hereunto set our hands and seals, at the county of Jefferson, in the State of Arkansas, on this, the 25th day of January, A. D. 1860. JAMES B. PAYEE, (Seal.) MARY PAYEE, (Seal.) ELIZABETH H. ROBIESOE, (Seal.) Ve concur with the majority ot the court that this dee'd does not evidence a mere agreement to convey nor a conditional sale, but upon its face shows a conveyance in fee, to the vendee. Gullett & Wade v. Lamberton, 6 Ark., 109; Muller v. Ruggs, 25 Cal. 187; Jackson et al. v. Blodgett, 16 Johns. 172; 38 N. H. 218; 36 Maine, 315; 1 Kernon N. Y. 320; Davis v. Tarwater, 15 Ark. 287. We are of opinion that this being an equitable proceeding, presents the question as to the validity of contracts made for slave property, but, without argument, we will treat that as. settled in the cases of Dorris v. Grace, 24 Ark., 326; Haskel v. Sevier, 25 Ark., 152; Jackoway, adm’r., v. Denton, 25 Ark., 625, and Pillow v. Pointer’s exr’s., 26 Ark., 240. We concur in the declaration of the court that Payne and Robinson could have enforced a lien against the lands. But we dissent from the holding of the court that Thomas cannot, as such assignee, enforce such lien. There are two kinds of vendor’s liens; a lien by express contract, or by agreement between the parties, and there is an equitable lien arising between the parties, where an absolute conveyance is made and no expression of an intention to reserve a lien is had; this latter lien is purely a creature of the law, and between the parties is enforced in equity, because it is unjust that one should hold the land of another, and not pay the purchase price. This lien is personal between the parties, or their privies, and "where innocent parties come in, or the notes pass off in the course of trade into the hands of third parties, such equities no longer exist, and no liens can be enforced. But where a vendor stipulates for a .lien to secure the pay. ment of the purchase price, and gives the proper notice to all •who may be concerned, such lien, then, becomes a security for sncli purchase, and may be enforced by tbe vendor, or be may assign it to another, and such holder may enforce it, because-all the world having notice of the existence of such lien, there-can be no innocent purchaser, and all being notified that the-purchase money remains due and unpaid, equity and justice requires that it should be paid before any other incumbrance should attach upon the land, and all subsequent contractors, must stipulate to meet such equities; Terry v. George, 37 Miss.; Amory v. Reely, 9 Ind., 490; 21 Cal. 178. And we hold that it is not material whether this lien is reserved by a separate contract' as by mortgage, or by an agreement in the deed of conveyance; in the first instance, the vendor parts with the whole title, and then has a right of lien re-conveyed to him; in the- latter, he parts with all his title except a right of lien, and that he reserves to himself to secure the purchase money, and in either case the property belongs to the vendee; but the vendor has the right to enforce the payment of the purchase price, out of it, before any assignee ©f the vendee can have a perfect title. And we hold that, in deeds, as well as in parol contracts, it is wholly immaterial what form of words the parties use, so that the language sufficiently evidences the intention of the parties; from the whole instrument executed, we are to arrive at their meaning, the understanding had Between the parties. In the case of Davis v. Tarwater, 15 Ark., 287; this court said: “The intent, and not the words, is the essence of every contract. In the construction, of deeds we are to consider the entire instrument, and not any particular part of it, and such exposition should be given as that every, part of a deed may, if possible, take effect and every word operate.” Courts of equity are not so much, as- courts of law, bound by the form of words. Equity seeks for the intention of the contracting parties, and decrees that such intention be carried out; and while there may be finely wrought distinctions between liens secured by mortgage and those otherwise incorporated into the contract by the parties in purely courts of law, such -discriminations do not exist in a court of equity. At law, the mortgagee may claim a legal title, but in equity, the substance of the estate, the body of the thing,, is in the mortgagor, and the mortgagee has a mere trusteeship to secure the performance of some acts, or the payment of certain moneys; Johnson’s Exrs. v. Clark, 5 Ark., 335; 4 Kent Com. 135, et seq. These distinctions should not be lost sight of when, as in this ease, we are investigating rights in a court of equity. .Row we repeat that courts of equity look to the actual intention oí the contracting parties, and endeavor to carry out that intention, and it is wholly immaterial whether that intention is expressed in one instrument or in more than one, so that by examining the various steps in the agreement, the will of the parties can be known. In Blakemore v. Byrneside, 7 Ark., 508, this court said : “In equity, the character of the conveyance is determined by the olear and certain intention of the parties. A deed absolute on its face and registered as such, will be valid and effectual as a mortgage between the parties, if it were intended by them to he merely a security for a debt.” In the case of the Planters’ Bank v. Courtney, 1 S. and M., 40, wherein the vendor sold a lot of land, gave his notes and stipulated in the deed that the lot was to be bound until both the notes were fully paid and-•satisfied; the notes had been assigned to the banks after the lots had been sold under execution to Isely, who sold to Henry ■Courtney, and he, to the defendant; the bill prayed a foreclosure. The answer set up that the original notes had been paid off and canceled, and others, with personal security, taken in satisfaction of the first, etc. The court said the only question was, whether the present notes were taken in satisfaction of the lien, not even doubting the propriety of foreclosing the equity of redemption, if the notes had not been satisfied,, And, in this case, the notes and lands had both passed out of the hands of the original parties. In a later ease the same court approve of this opinion, and further declare an indorsement on a deed to constitute a mortgage in equity. Baldwin et al. v. Jenkins, et al. 23 Miss. In Pennsylvania, the policy of the law has always been against equitable liens, and her courts have persistently disallowed them. The Superior Court of that State said: “Equitable liens, though long prevalent in English and some of the American courts of chancery, was never intended to be admitted into Pennsylvania jurisprudence.” But in the case of Heister v. Green, 48 Penn. S. 101 and 102, the court of appeals say: “The sum of the authorities is, that though equitable liens are not favored by our law, yet parties may, by clear and express words, in deeds of conveyance, create liens upon lands, either for purchase money or for the performance of collateral conditions,” etc. If these rules be admitted, we then have to examine the deed and find out the intent of the parties. Did they, by this instrument, intend to sell and transfer the lands and personal property, specified in this deed, to Sheppard ? It is clear that they did. This question is settled by the whole court. Next, did they intend to reserve a lien, upon this property, to secure the payment of the purchase money ? Immediately after the close of that clause in the deed vesting the title in Sheppard and his heirs, they proceed to say, “the deed is made upon the condition that he pay the remainder of the purchase money, and that the said sum of $86,140, together with all interest that may accrue thereon, shall be and remain a lien on all and singular the lands, slaves and personal property hereinbefore mentioned,” etc. Is this language not clear and explicit? Does it not show the intention of the parties ? It does not declare that a lien is reserved to hold Payne and Robinson harmless, but the lien is to secure the payment of all the purchase money and Ínteres^, and upon such full paymént the deed is to become absolute. Then follows a clause in which they say, retaining their equitable lien on this property for this sum, they relinquish all rights to collect any part of the amount, out of any other property of said Sheppard, and they rely entirely on their said lien for security and payment. How, if Payne and Robinson did not intend to retain a lien by contract, if it was not intended as a part of the agreement, why should they as often as three times, announce that such lien was retained ? In this, we not only have the express language of the grantors that they retain a lien, but another fact showing why they retained it; that is giving the best reason for its retention, that was, they were parting with $86,140 worth of property, and releasing all right to- collect anything, except out of the property they were turning over to Sheppard. If it can be made more clear, this certainly gives force to their positive assertion, that they do retain a lien. How, it seems to us, the majority of the court commit a mistake, wherein they say: The clause in the deed by which the lien is said to be executed, and which Thomas claims was assigned to him by the mere assignment of the notes reads as follows: “And we the said James B. Payne and Elizabeth Robinson, herein and hereby reserving and retaining our equitable lien on all and singular the lands” etc. etc., “and release all other property” etc. etc. How this clause, in the deed, is not the clause by which the lien is created and declared. The object of this clause was to release Sheppard from liability, so far as all other property was concerned, and it only contained a reference to the lien, the amount unpaid and the property upon which they relied for payment. It was the preceding clause that announced that the property was conveyed upon condition that Sheppard should pay all the balance of the purchase money, and that they retained a lien thereon for the amount due, and that upon the payment-of that sum and interest, and not before, Sheppard’s title should be absolute. This is the clause limiting Sheppard’s title, and nothing is said about the lien being equitable; but in this emphatic manner they declare their lien shall exist, and Sheppard’s title shall not be absolute and in fee until the payment of all this money. But if the draftsman of the deed had used terms less appropriate or inappropriate, a court of equity would have reviewed the whole transaction and decreed according to the meaning of the contracting parties, and without hesitating at the use of an improper or inappropriate word. And there is certainly a marked difference between an equitable lien that is created solely by the law, and one created by agreement or contract between the parties. The equitable lien arises out of the relationship between the parties; the peculiar circumstances surrounding them, which show that injustice would be done for one to hold property without compensating the former holder; while a legal lien or lien by contract is where the original owner stipulates that a lien shall exist for the payment of the money or performance of some stipulation, and we hold that it is wholly immaterial whether the lien is by reservation in the deed of conveyance or whether that deed is absolute, and a reconveyance by mortgage as security, and that in equity no distinction is made. Is it not clear, if one has an absolute title to property, he can convey the whole of it, or just such part as he chooses? May he not make a deed to pass title at once, or upon condition, or at a fixed time in the future? May he not fix the title in one and the use or profits in another, or reserve the use of a part thereof to himself, etc. etc ? He can sell what he chooses and reserve what he desires, and when he only conveys a legal estate, and retains a right to collect so much purchase money as may be unpaid, that much interest in the estate is as effectively and legally in him as it can be, because he held all interest, and to that extent it has been conveyed away. But the majority say, Payne and Bobinson had a lien upon the land for the payment of the purchase money, without having this reservation in the deed, and therefore, the reservation was surplusage; it was a work of supererogation to insert such clause in the deed, and the deed meant no more with this clause than the law implied without it. Can I not say, with the same force of argument, that there is no use in a vendor taking a deed of. mortgage to secure his‘unpaid purchase money; that notwithstanding his deed is absolute on its face, equity gives him a lien for that money, and it is a woi’k of supererogation to take a mortgage ? Suppose the court should say, without a mortgage an assignee can not enforce payment -out of these lands, or an innocent purchaser might get these lands, we repeat the same argument. In this instance, the lien was' reserved, not alone to Payne and Robinson, but to ■secure the payment of the purchase money, in whose hands •soever, and the lien was patent upon the face of the deed; and Sheppard could convey to no one who could he an innocent purchaser, because when they looked upon his title, they would see the amount to pay before the title in him was absolute, and when he registered that deed, then the public records gave notice to the world of the amount to be paid before the title in Sheppard was clear; and the deed set out a full description of the notes which were to be paid. Then it seems evident that a lien by contract is preferable to a mere equitable one, and it will be seen by carefully examining this deed that every clause on that subject declares this lien for the security ■of the purchase money, and to say that it is not more than an ■equitable lien that can reach no further than to Payne and Robinson personally, is a construction we do not sanction. The majority held that the parties, contracting, must be presumed to use terms, in conveyancing, with an understanding of the law, and the former decisions of our courts. If so, the draftsman of this deed must have known that Payne and Robinson had an equitable lien to secure them, without any reservation in the deed. Knowing that when they inserted in the deed a clause declaring that a lien was reserved until the purchase money and interest was all paid, they necessarily meant more than ‘an equitable lien; they meant a lien that would attach the property until the notes were paid, and if they meant that, this court, in the case of Davis v. Tarwater, said their meaning and intention must be carried out by the court of chancery. In the case of Heist v. Baker, 49 Penn. S., 13, where a deed conveyed tbe lands in fee with this clause, “under and subject, nevertheless, to the payment of the sum of $932 52, at the decease of the said Elizabeth G-ross, unto the above named Anna Eliza,” etc., the court said, “The ruling of the learned judge is resisted on the authority of Heister v. Green, 12 Wright. 96, but this is the very converse of* that case. There was no express charge upon the land, and here there is. Such is our repugnance to implied or constructive liens that we refused to treat a recitation of unpaid purchase money as a lien, though standing in the channel of title, and we desire to be understood as having refused, after great consideration of the subject, but where it is expressly charged, the lien must be supported. It is the distinction between express and implied liens.” ~We allude to this because Pennsylvania, above all other States, opposes implied or equitable liens, yet they uphold a lien expressed on the face of the deed. See Royer v. McCook, et al., 7 Ala., 318; Anthony v. Smith, 9 Hump. 508; Claner v. Rawlings et al., 9 S. & M. 122. In the case of Murray v. Able, 19 Tex. 213, the Supreme Court say: “Able sues for the use of Mills and Jockusch, on notes given to Able in the purchase of land, and the vendor’s lien on the land is expressly reserved in the notes; the court enforced the lien; also, see McAlpine et al. v. Burnett et al., 19 Tex. 497 and 1 Tex. 326; Haley v. Bennett, 5 Porter, 452; Eskridge v. McClure and Walker, 2 Yerger, 84. In the case of Lewis v. Carilland, 21 Cal., 178, Burlingame executed, to Carilland and Nye, a warranty deed, of which the consideration clause is as follows:. “In consideration of the sum of ten thousand dollars, received to their full satisfaction of Charles Carilland and M. E. Nye, both of the same county and State, aforesaid, grantees, to be paid as follows: $4,000 in cash down, and the balance, by the assuming, on the part of the said grantees, the payment of a certain mortgage upon the property hereinafter described, made by the above described Joel Burlingame, on the 7th day of August, 1855, in favor of T. N. E. Lewis, for $6,000.” On the 25th of September, 1857, Carilland and Lewis agreed to release tbe mortgage, and Carilland gave two notes and a mortgage, but not for enough to cover tbe original $6,000 claim; and Lewis gave up tbe first mortgage, and entered upon tbe record thereof satisfied by being released. In 1858, Bur-lingame assigned, by a written instrument to Lewis, any and all right or claims be might halve against the parties and the lots, and the Supreme Court held that for this old claim, Lewis could enforce a vendor’s lien; the mortgage had been released, but the original deed showed upon its face that part of the purchase money had not been paid. Stratton v. Gold, 40 Miss. 778, is a case exactly in point, in which that Supreme Court says: “Here the lien is retained in the very deed which conveyed title to the vendee, which must necessarily be recorded, and of which every purchaser must take notice; and for all the reasons upon which equitable rights in such cases are founded, it appears to differ in no substantial respect from a technical mortgage. It contained the express contract of the parties, and was shown in such a way that all persons were bound to take notice of it. In principle, and as to the substantial rights of the parties, it does not differ from a technical mortgage, and in case of such a mortgage, it is held that a legal transfer of the note secured is an assignment of the mortgage,” etc. We cannot quote all that is applicable, because the whole ©pinion is a strong argument in favor of the views we entertain, and the judgment directly against the majority of this court. In the case of Bowen v. Gilman, 4 Wheat. 290, which grew out of a sale and deed of lands, from the Georgia land company to the New England land company, Chief Justice MARSHALL , in delivering the opinion of the Supreme Court of the United States, said: “In examining this question, the nature of the contract, the motives of the New England and Mississippi companies, and their acts are all to be considered. * * * * In the original agreement an express stipulation is made that the pr operty shall remain liable for the first payment, but the separate securities stall be taken for tbe residue of tbe purchase money. Tbe deed itself remains an escrow until tbe first payment shall be made, and is then to be delivered as tbe deed of tbe parties, after which tbe vendor’s consent to rely on tbe several notes of tbe respective purchasers; this is equivalent to a mortgage of the premises, to secure the first payment, and a consent to rely on the several notes of tbe purchasers for tbe residue of the purchase money. Tbe express contract that tbe lien shall be retained to a specified extent, is equivalent to a waiver of that lien to any greater extent.” Tbe Supreme Court of Kentucky bolds that a recitation in a deed that tbe purchase money has not been paid, or that it is to be paid in a certain manner, is constructive notice of the lien, and that tbe lands, in tbe bands of one bolding under tbe vendee, are subject to tbe original lien, and that such subsequent bolder cannot be an innocent purchaser, because be is bound to take -notice of -the recitation in tbe deed to bis vendor, and that affects him with notice. Honore v. Bakewell et al. 6 B. Mon. 67; Thornton, v. Knox, etc., Ib. 74; Woodward v. Woodward, 7 B. Mon. 116. Eor these reasons we have not concurred with tbe majority.