Court Opinion

ID: 9810976
Source: CourtListenerOpinion
Date Created: 2023-08-31 22:05:44.918264+00
Date Added: 2024-06-11T13:40:23.047499
License: Public Domain

Clark, C. J.,
dissenting: J. H. McAden, trustee under the will of R. Y. McAden, on 29 October, 1902, entered into a contract with E. P. Cover to convey certain tracts of land in Cherokee and Olay counties. Before the deed was executed, both parties having died, under a proceeding instituted in Cherokee, judgment was entered decreeing that defendants herein convey to S. E. Cover and others, heirs of E. P. Cover, the plaintiffs herein, the said land at the price agreed upon of $2.25 per acre (which was paid 1 March, 1905), and the defendants, in their deed to plaintiffs, severally but not jointly, covenanted that the grantors were seized in fee of said land, have good right to convey the same in fee, that there were no encumbrances thereon, and that they would “warrant and defend the title against the lawful claims of all persons whatsoever.”
On 17 May, 1906, the heirs of F. P. Cover, grantees in the deed above referred to, and the plaintiffs in this action, conveyed the said land, with exactly the same covenants, to the Hiawassee Lumber Company. At the date of the aforesaid mentioned deed neither of the parties were in actual possession of the lands herein referred to. On 19 August, 1910, the United States brought action in the Circuit Court of the United States for the recovery of a certain part of said land, and the case was ultimately carried to the Supreme Court of the United States by appeal, and a final judgment in favor of the United States was entered 11 March, 1919, which adjudged that the United States recover of the said Hiawassee Lumber Company the 2,632 acres in controversy, and which had been conveyed by the defendants to the plaintiff. On 17 March, 1919, the Hiawassee Lumber Company demanded of the plaintiffs a *649return to it, with, interest, of tbe amount of money which it had paid to the plaintiffs for the land.
On 10 April, 1919, the plaintiffs demanded of the defendants the repayment of the sum of $2.25 per acre, with interest from the date of the payment thereof, as purchase money, which had been paid by the plaintiff to the defendant for the said 2,632 acres. This demand was repeated'in a letter of 25 April, 1919. On 6 May, 1919, the defendants acknowledged receipt of these two letters, and on 8 May they were again called upon for payment, to which their attorney made reply on 15 May, that the plaintiffs had no right to claim anything from the defendants until the plaintiffs had paid the Hiawassee Lumber Company its loss. Thereupon, on 23 May, 1919, the plaintiffs paid to the Hia-wassee Lumber Company said sum and took their full receipt therefor with interest. Notice of such payment was given to the defendants on 23 May, 1919, and demand made that they reimburse the plaintiffs. The defendants, refused to reimburse the plaintiffs for the purchase money paid by them, and this action was brought 11 December, 1919. It was admitted on the trial that the plaintiffs in this action had succeeded to all the rights of the heirs of F. P. Cover to recover of the defendants on their warranty in the deed of February, 1905, and that the lands recovered by the United States in the case against the Hiawassee Lumber Company were a portion of the lands conveyed by the defendants to the plaintiffs by above deed of February, 1905, and that neither the grantors in the deed from the McAdens to the Covers and none of the grantees in said deed ever had actual possession of the lands covered by the deed.
The sole defense was the statute'of limitations. The Hiawassee Lumber Company, grantee of the plaintiffs, having lost the land in question under a decree of the United States Supreme Court, and the plaintiffs having reimbursed said lumber company for said loss under their warranty, and neither the defendants nor plaintiffs having been in possession at the time of-the conveyance in 1905, it would seem unnecessary to discuss the liability of the defendants upon the warranty set out in the deed from them to the plaintiffs that “they had a good right to convey the land in fee, that there was no encumbrance thereon, and they would warrant and defend the title to their grantees,” and that in justice and in equity the defendants should be decreed to make good the purchase money they received in 1905 of $2.25 per acre on the 2,632 acres, and interest.
The statute of limitations is based upon the equitable principle that parties who have slept upon their rights are not entitled to recover, but ■ in this case there has been no delay.
The plaintiffs had no notice of any defect in the title, and thought themselves secure, and in good faith relied upon the warranty given *650by the defendants. There was nothing to put them on guard, neither-party was in possession, and there was no eviction until the recovery of the land by the United States. The defendants then refused to pay until the plaintiffs had reimbursed the lumber company, and after this! was done, on demand of repayment, the defendants refused, and this' action was promptly instituted. The defendants having conveyed to-the plaintiffs property to which they had no title, and having' received-money therefor, should reimburse the plaintiffs. This action was brought within less than a year after their mesne grantee was evicted by the* true owner of the title.
There could certainly be no action on a warranty to defend until there-was an eviction, or some act which amounted (.0 an eviction. In this case there was also a covenant of seizin at the time the deed was made,, and under some authorities the plaintiff would have been barred in a suit solely on such covenant, but in this case the action is brought on the* covenants of warranty and for quiet enjoyment on which-an action could not arise until there was an eviction or disturbance of the plaintiffs or their grantee in their right to possess the land. This occurred only after the judgment rendered against the Hiawassee Lumber Company-of eviction from the lands, and it was adjudged that the title was in the-United States. The statute of limitations, therefore, did not begin to-run until the entry of that judgment.
In 15 Corpus Juris., 1298 (sec. 181), the doctrine is thus stated: “The-right of action for a breach of covenant accrues at the time of the-breach, and the statute begins to run from that time and not from the time of execution of the covenant,” citing a large number of authorities, from many states and countries.
In 1 R. O. L., 1186, the same doctrine is thus stated: “It is well settled that the statute of limitations begins to run against an action for breach of warranty only from the time of actual or constructive eviction. Where, however, a superior title is outstanding in the third person, at the time of the execution of the warranty deed, the covenants of the deed are broken when that title is actually asserted and the covenantee is. obliged to surrender possession so that the statute of limitations commences then to run rather than from the date of the delivery of the deed.”
The Hiawassee Lumber Company was obliged to yield to the title of the United States by the judgment of the Court in 1919, and immediately 'the right of action against the defendants arose and the- statute-of limitation then began to run, and not before. “In an action for-breach of warranty, the question of action does not arise until there is. an ouster.” Mizzell v. Ruffin, 118 N. C., 69.
*651In Wiggins v. Pender, 132 N. C., 640, this Court said: “The plaintiffs’ cause of action is not barred by the statute of limitations. It did not occur until there was an eviction which took place in 1901, and the statute does not commence to run until the right of action has accrued.”
In 13 Anno. Gas., 700, the law is thus stated: “It is well settled that the statute of limitations begins to run against an action, brought for a breach of warranty, only from the time of actual or constructive eviction,” citing a large number of cases, among them Flowers v. Foreman, 23 Howard, 183; Mizzell v. Ruffin, supra; Wiggins v. Pender, supra, and Shankle v. Ingram, 133 N. C., 254.
In Flowers v. Foreman, supra, the United States Supreme Court said: “The cause of action accrues on a covenant of warranty when a judgment of eviction is rendered or when the defendant in that suit paid the money to satisfy the successful party in that suit.”
The authorities to the above effect are so numerous that we will not add any more, but will merely advert to the fact that if, as the defendants contend, the possession of lands belonging to the Government confers no right upon the possessor, no lapse of time should confer immunity upon a warrantor. Any other view would certainly work a great injustice in all such cases. It is difficult to see how the plaintiffs had a cause of action on the warranty to defend the title until the Government made its claim. Undoubtedly, if the plaintiffs had brought suit on the warranty to defend title before the Government made claim to the land, they would have failed in their action because their right to possession under the deed from the defendants had not been disturbed. All parties assumed that the lands belonged to the defendants, who warranted title and covenanted that they would defend it, and the title was not questioned by anybody until the Government brought suit in 1910.
The defendants should make good to the plaintiffs the money which the defendants received for the land, with interest, when they received notice that their grantees, the plaintiffs, had been compelled to make good under the same warranty to the lumber company, who had been evicted by the judgment of the Court in favor of the United States. It seems that the defendants themselves were of this opinion, for when payment was first demanded, their only objection, then, was that the plaintiffs had not then paid in full the Hiawassee Lumber Company, their own grantee.
The right of the plaintiffs to recover the purchase money paid by them to the defendants rests upon the soundest principles of justice which cannot be defeated by reference to minute technicalities in the complicated procedure under the Feudal System so long ago (1660) happily abolished by the statute, 12 Charles II.