Court Opinion

ID: 7891096
Source: CourtListenerOpinion
Date Created: 2022-09-08 21:49:03.589058+00
Date Added: 2024-06-11T16:31:51.536136
License: Public Domain

The opinion of the court was delivered by
Smith, J. :
It is not necessary, in determining this case, to question the rule that instruments such as deeds, mortgages, etc., placed in escrow to await the performances of conditions precedent to delivery, do not take effect until such conditions are complied with. The agreement set out in the statement is a contract'of sale. It expressly states that E. Gilmore has sold to A. Strausbaugh the land described for the sum of $5250, to be paid in the instalments mentioned. It further provides that Strausbaugh. shall not encumber the premises in any manner. A reasonable construction of the language employed by the parties forces the conclusion that a present sale of the property was intended. To say that the intention was to give Strausbaugh a mere option of purchase, and *609that he took no title, would require the rejection of language used in the contract, and a substitution therefor of words of different meaning. The contract does not contain a condition that no title shall pass to the grantee until the delivery of the deed, the language used being at variance with this construction. Upon the performance of the conditions of payment, a deed containing covenants of warranty was to be delivered to the grantee, conveying to him the legal title, whereas, under the contract, he was the equitable owner. (Jones v. Hollister, 51 Kan. 310, 32 Pac. 1115.)
“It seems to be well settled that when articles of agreement are entered into for the sale and purchase of land, the purchaser is considered the owner in equity of the land, subject to the payment of the purchase-money ; he is regarded as trustee of the purchase-money for the vendor, and the vendor is treated as a trustee for the purchaser of the legal title, having no interest in the land beyond the amount of the purchase-money due. It does not seem to be necessary to produce this effect, that añy part of the purchase-money should be paid ; it results from the contract.” (Liter, James & Co.’s Appeal, 26 Pa. St. 178.) See Miller’s Administrator v. Miller, 25 N. J. Eq. 354.
The amount of the consideration to be paid was stipulated in the agreement, and Strausbaugh was to have time to pay a large portion of the same, as evidenced by the notes. The provision relating to the deferred payments secured by the mortgage was for the benefit of Strausbaugh. He could not divest himself of the equitable title conveyed by the agreement by making default in payment. He still held such title thereafter, subject to the lien of Gilmore for the purchase-money. This being the state of the title, the administrators of Gilmore were proper parties plaintiffin the suit. “A contract for the sale of real estate *610works an equitable conversion of the land into personalty from the time when it was made, and the purchase-money becomes, thereupon, a part of the vendor’s personal estate, and, as such, distributable, upon his death, to his widow and next-of-kin. (Miller v. Miller, supra.)
The action of Juliann Gilmore in taking a deed from Strausbaugh after the death of her husband is not material. It merely showed her construction of the legal effect of the contract.
There being a sale of the property to Strausbaugh at the date of the delivery of the contract, followed by possession, it would be inequitable for him to occupy the land, make default in payment of the notes in escrow,' and then say that the grantor could not recover on the notes which evidenced the amount he was to pay. The conditions and terms of the notes and mortgage must, under the circumstances of the case, be considered as part of the contract of sale.
The judgment of the district court will be affirmed.