Court Opinion

ID: 5574596
Source: CourtListenerOpinion
Date Created: 2022-01-11 01:20:12.421008+00
Date Added: 2024-06-11T08:35:52.955733
License: Public Domain

EvaNS, J.
(After stating the facts.) 1. This not being the first grant of a new trial, and the presiding judge having expressed himself as satisfied with the finding of the jury upon the only issue submitted to them for their determination, their verdict should be .allowed to stand if sufficiently supported by the evidence, unless the plaintiff in fi. fa., Lewman, was unjustly prevented from presenting his contention that the Equitable Loan & Security Co. was es-topped from asserting title to the land levied on. There was, we think, ample evidence to sustain the conclusion that the deed from Mrs. Harris to Farrar, in the execution of which two of her daughters joined, was delivered to him in 1878. He testified on the trial that he could recollect nothing with regard to its execution and delivery to him, and would not have assisted his wife in procuring a loan on the land as her property in 1898 had he at that time known of its existence, and. that he did not remember ever having seen the paper till, some months after he received the bundle of papers which Miss Josephine E. Harris stated had belonged to her mother, he discovered it among them. ' Miss Harris testified she had no remembrance of signing it and could not identify as genuine the signature of herself or sister, though what purported to be the signature of her mother corresponded with her handwriting. On the other hand, there was testimony, which Farrar did not undertake to question, that the paper was drawn up in his handwriting, as was also the affidavit of one of the subscribing witnesses. This witness was sworn at the trial, and testified that the document was genuine and he had signed the probate indorsed thereon before W. W. Grant, a notary public, at the West Point freight-depot, in the City of Atlanta. The notary public was shown to be no 'longer in life. The tax returns showed that Mrs. Harris did not, after the year 1878, return this south half of the land for taxes, but that the same was returned in the name of E. M. Farrar as owner from 1879 up to 1898. He stated he had, with money borrowed for the *196purpose, erected on the lot the house in which he lived up to 1886, but gave no satisfactory account of the circumstances under which he assumed to take possession of the premises, further than to say he had to live somewhere, and that he occupied the house without objection from Mrs. Harris. In her will, Mrs. Harris recognized this lot as belonging to Farrar, by describing the premises she devised" to her daughters as being bounded on the “south by house and lot of Eobt. M. Farrar.” The deed was never recorded prior to-the commencement of this litigation, but there was testimony from which the jury could infer that it was designedly kept from record because Farrar was financially embarrassed and did not wish the fact of his ownership of the lot to become known to his creditors. In view of all the circumstances brought to light, we are of the opinion that the finding of the jury should not be disturbed; and in our further discussion of the case the fact will be assumed that in 1878 Mrs. Harris did execute and deliver to Farrar a deed covering an undivided four-fifths interest in the land in controversy.
2, 3. The true owner of property may estop himself by his conduct from asserting title to his own property, as when he stands by and allows property' belonging to him to be sold to an innocent purchaser for value as the property of another. American Mortgage Co. v. Walker, 119 Ga. 341, and cit. Or, he may so estop himself by attesting a deed, of the contents of which he knows, made by a person who has no title. Ga. Pac. Ry. Co. v. Strickland, 80 Ga. 776. The negotiation of the loan from Lewman by Farrar in behalf of his wife and his attestation of her deed given to secure the loan would estop Farrar from asserting title in his own favor as against Lewman, assuming, of course, Léwman’s ignorance of the true title. This estoppel in pais occurred pending the suit, but before the rendition of the judgment under which the land was sold. While the doctrine of caveat emptor applies to sheriff’s sales, a bona fide purchaser at an execution sale, who has paid the purchase-money without notice of an equity, will be protected against the same. Johnson v. Equitable Co., 114 Ga. 604. The purchaser is subrogated to all the rights of the execution creditor bringing about the sale; and before the title of a bona fide purchaser can be defeated by an equity in a third person, the purchaser must not only have actual notice of the equity, but that equity must be superior to the lien of the judgment creditor bringing about the sale. *197Atkinson v. Beall, 33 Ga. 153; Humphrey v. Copeland, 54 Ga. 543. “It is the right of the judgment creditor to sell whatever his judgment binds. This right would be impaired if purchasers were not ■allowed a corresponding right to buy. This corresponding right to buy purchasers would not have if they were liable to be affected by .a notice of other liens or claims inferior to the judgment.” Smith v. Jordan, 25 Ga. 689. From these observations it will appear that no proper solution of the rights of the purchaser at sheriff’s sale can be arrived at without determining the relative superiority of the lien of the Kountree execution, which sold the'land, and the lien of Lewman acquired by virtue of Mrs. Farrar’s security deed, ■aided by the estoppel of Farrar. While great stress was laid, in the argument, upon the fact that the estoppel occurred a few days before the judgment was entered, we do not think this circumstance at all conclusive. The suit of Eountree which eventuated in the judgment was pending at the time the Lewman loan was effected. This particular creditor of Farrar had a right to reduce his debt to judgment, and the lien of his judgment ought not to be restricted because his judgment debtor had defrauded some one else. The general rule of estoppel is that only parties and their privies to "the act or representation relied on to estop are affected by an es-toppel in pais. 11 Am. & Eng. Enc. L. (2d ed.) 439. It can hardly be contended that any privity could exist between two ■creditors of a common debtor, each contending for priority of lien .and preference in payment of his debt, where neither conspired with the debtor to defraud the other. In Shearer v. Woodburn, 10 Pa. St. 511, the Supreme Court of Pennsylvania held that “declarations by one reputed to be the owner of lands that the title was in A, made to one who thereafter purchased A’s title, will not estop a subsequent purchaser under a judgment recovered against such person, at or about the time of his making such declarations, from ■setting up his title against the purchaser from A.” A similar ruling was made in Lyon v. Morgan, 64 Hun, 111, by the Supreme Court of New York. Bigelow, in his work on Estoppel (5th ed.), 609, says “it would seem that a purchaser of goods is not a privy in estate or otherwise with his vendor so as to be affected by an ■estoppel in pais resting on the vendor in respect of the goods. Thus, if a person stand by and allow his goods to be sold as the .goods of another to one who does not take possession, and the actual *198owner afterwards sell the same to another person for value and without notice of the previous transaction, the latter would be entitled to the goods against the first purchaser. The owner would simply be precluded from setting up title against the purchaser. It is not the office of an estoppel to pass title. The title remains, but it can not be asserted against the party who acted upon the false representation. With reference to others it may be asserted or conveyed; and a purchaser, not being a privy, would not be estopped to assert title to the goods. This is certainly true of a purchaser under an execution against the real owner.” The author cites Richards v. Johnston, 4 Hurl. & N. 660, in support of this last proposition. In that case it was said that “A sheriff who comes to seize the goods of a debtor under a writ of execution is not bound by an estoppel which might have prevented the debtor himself from claiming the goods.” In a later English case, that of Richards v. Jenkins, 18 Q. B. Div. 456, 56 L. J. Q. B. 293, Lord Esher said: “Such an estoppel merely prevents the party who is estopped front saying as against some other party that the goods do not belong to such other party, though in fact they do not belong to him; and it only takes effect as between parties and privies. If the execution creditor could for this purpose be said to claim through and under the execution debtor so as to be in ¡Drivity with him, he might be estopped. But I do not think he can be said to so claim; he claims through and by the law as against the execution debtor and not through and under him.” In a Nebraska case it appeared that the owner of a business, by representing that it belonged to his wife, induced persons to sell goods to her and to take a. mortgage as security. Other persons, who had no knowledge of this misrepresentation, sold goods to the husband, and afterwards issued attachments against him. The court held that the attaching creditors were not bound by the estoppel, and consequently took priority over the mortgage. Oberfelder v. Kavanaugh, 29 Neb. 428. See also Bingham v. Kirkland, 34 N. J. Eq. 229. In Water’s Appeal, 35 Pa. St. 526, Woodward, J., said: “The truth is, the relation of judgment creditors to their debtor’s real estate is anomalous. They have a lien upon it by virtue of statute law, but they have no interest in it such as makes them privies in estate with their debtor.” A contrary view was expressed in Parker v. Crittenden, 37 Conn. 148, in which case it was held that attaching creditors of a debtor, *199who with intent to defraud his creditors had conveyed a hack to another and then stood by and allowed him to sell to an innocent purchaser, were privies in estate with their debtor, and, as such, estopped to set up title in him. This was ruled notwithstanding it. appeared that the innocent purchaser had not paid for the property, the court saying he “had a right to the-benefit of his purchase.’*' In Ewart on Estoppel, 208 et seq., the author, in commenting on these two lines of decisions, which differ as to whether'an estoppel upon a debtor will bind his creditors, says (p. 210) : “Solution of the question in hand by a discussion of the existence of privity does not appear to promise great success.” He expresses the opinion that if privity in estate be the test, a purchaser at sheriff’s sale gets only that which the debtor had, subject to all equities of every sort; but suggests (p. 209) that the true test to be applied, in determining whether or not a party other than the one who has estopped himself by his conduct can assert title in any’given instance, is to “ascertain upon general principles who ought to have priority, and then, in accordance with the conclusion so arrived at, declare that the sheriff’s purchaser was, or was not, in privity with the vendor, and so bound by the estoppel.” This seems to be the proper test, looking to the origin and the purpose of the doctrine of equitable estoppel and its application to a case where the owner of property stands by and allows it to be purchased as the property of another. Those only who are chargeable with the fraud, actual or constructive, perpetrated upon the innocent purchaser, and those who seek to gain some benefit or advantage therefrom or, as volunteers, succeed to the rights of the person who has estopped himself by his conduct, should be held bound by the estoppel. Creditors gain nothing by the commission of such a fraud upon an innocent purchaser, but (if held bound by the estoppel upon their debtor) must suffer the loss of their demands against him, in whole or in part. They do not seek to ratify or confirm any. act which he has done with respect to his property, but repudiate an act which was fraudulent, not only as against the innocent purchaser, but as against them as well; for by that act the debtor disclaims title to property which ought to go towards paying off his just debts, instead of being sold for the benefit of a person who has no title or interest in it nor lien upon the same. Certainly, as a general rule, “No privity exists between creditor and debtor; there is neither devolution nor *200subordination of rights in the relation.” Bigeldw on Estoppel (5th ed.), 343. As between creditors of a common debtor, one is not entitled to prevail over another unless he has acquired a superior lien such as is recognized by law in the way which the law prescribes. Thus, in Water’s Appeal, supra, an owner of land conveyed it to another with general warranty, acknowledging receipt of payment of the purchase-price and taking judgment for a portion of the purchase-money which had not in point of fact been paid. Subsequently, other creditors of the vendee obtained judgments against him, which were levied on the land, and the proceeds of the sale were paid into court. These creditors then sought to exclude the vendor from participation in the distribution, because of the recitals in his deed to their debtor; but the court held there was no .estoppel of which they could take advantage. So it will be seen that the rule of estoppel, based upon the theory of privity in estate, works both ways, and can not be relied on as bringing about equitable results, as was recognized in the case just cited. “Estoppel arising in virtue of a misrepresentation is the' converse of an action of deceit. The property or interest claimed by reason of the es-toppel corresponds to the damages sought in the action of deceit; and in order to make good the claim of estoppel, the same things, it should seem, are requisite that are necessary to the maintenance of the action mentioned.” Bigelow on Estoppel (5th ed.), &09-610. The wrong committed upon an innocent purchaser from one other than the true owner, who stands by and allows a fraud to be committed upon the party misled, gives to him a cause of action. As against the true owner, he has two remedies: one an action for damages for the deceit practiced upon him, and the other a plea of equitable estoppel against asserting title to the property so bought. If the former remedy were pursued, no one could contend that, by reason of the purchase under such circumstances, the purchaser acquired any estate or interest in the property, or lien thereon. Only by proving his cause of action and procuring judgment upon his demand against the true owner could the purchaser obtain any lien upon the property, and the judgment lien would rank in dignity, as against other liens on the propertjq only in the order of its date. He would not, until he in this way established a lien, stand in any better position, relatively to other judgment creditors of the owner, than any one who had a demand against *201him not reduced to' judgment. The law gives priority, among ■creditors, to those who first avail themselves of the remedies whereby they can establish and enforce their rights against the common ■debtor. The innocent purchaser who is the victim of the fraud ■can not, by way of equitable estoppel, gain an advantage over others having claims against the owner of the property, since he has no lien thereon nor legal nor equitable estate therein. He is simply the victim of a tort, and has no greater interest in the property •of the tortfeasor than would a person who was injured by its owners ■carelessness or wilfulness in running over him in the street with a ■carriage or automobile.
As we have endeavored to show, the purchaser of the land under the Rountree fi. fa. is remitted to all the- rights of the plaintiff in fi. fa.; and as the record suggests nothing even tending to estop the original execution plaintiff, it-is immaterial what notice may have been given on the day of the sale, or what wTas the arrangement between the purchaser and the transferee of the execution looking' to the bringing of the land to sale. The purchaser’s title was altogether unaffected by the estoppel of Farrar, and if the legal title was in Farrar at the date of the judgment under which the sale was made, then it passed by virtue of the sale to the purchaser. The finding of the jury that the deed from the Harrises to Farrar had been delivered settled the issue of fact as to title.
4. It was further urged in the amendment offered, and which was ■disallowed, that the claimant undertook and agreed to pay the indebtedness to the plaintiff in writing, and that, on account of this assumption of the indebtedness and agreement to pay the same, the •claimant can not now dispute either the amount thereof or the priority of the same over any title it may have. It does not appear from the allegations of the equitable amendment with whom the •claimant entered into this agreement. If the agreement was made with the plaintiff in fi. fa., his remedy is upon the contract; if made with some other person, he is a mere stranger to it and it can not be urged as an estoppel against the claimant in asserting its title to the premises.
5. Criticism is made on the instruction of the court on the subject of delivery of a deed, the plaintiff insisting that-one of the phrases used by the court was technical and should have been explained to the jury. The court instructed the jury that delivery *202was sufficient if the deed went out of the hands or control of the grantor, “with her intent that it [should] operate and inure as a muniment of title to the grantee.” This expression is characterized as so technical that its meaning should have been explained to the jury. Considered in connection with the context, we can not think that an intelligent jury could have failed to apprehend the meaning of the court. Besides, if the plaintiff had desired any further elucidation of the instruction, he should have made a timely request of the court. Holmes v. Clisby, 121 Ga. 248. In these modern times, where there is such a general diffusion of education among the masses and our juries are made up of intelligent and upright citizens, it would seem that they should be given some credit for intelligence and comprehension, even though the idea be expressed in other than colloquial speech.
6. In the third, fourth, and fifth grounds of the motion for a new trial complaint is made that the court submitted to the jury the single issue whether or not the deed from Mrs. Maria L. Harris,, Josephine E., and Matilda F. Harris to Robert M. Farrar had ever been delivered; and failed to instruct the jury that inasmuch as this deed was not recorded, it was junior to the deed held by Lewman from Frances F. Farrar, for the reason that the title held by her and conveyed to Lewman was derived through the will of her mother and her sister, Matilda, and by a deed from Josephine E. Harris, which was duly recorded — provided Frances F. Farrar took this deed from Josephine E. Harris without notice of the prior conveyance made to Robert M. Farrar. Prior to the recording act of 1889 (Civil Code, §2778), a recorded deed from an heir or devisee was inferior in dignity to an unrecorded deed of the ancestor. Webb v. Wilcher, 33 Ga. 565; McCandless v. Inland Acid Co., 108 Ga. 618. This rule was changed by the act of 1889, and that statute applies where the senior deed was made by a testatrix and the junior by her devisee. Holder v. American Investment Co., 94 Ga. 641. But the court properly omitted to submit to the jurjr any issue as to the relative priority of the unrecorded deed to Robert M. Farrar, for the reason that under the undisputed facts the junior deeds relied on by Lewman should not have been given priority, inasmuch as the record of the title of Frances F. Farrar to the lot in controversy was sufficient to put Lewman on notice that Mrs. Mariá L. Harris had, prior to the *203execution of her will, disposed of this lot to Robert M. Farrar, and that it therefore constituted no part of the residuum of her estate. It will be remembered that in the will of Maria L. Harris the lot on Collins street, which was specifically devised to two of her daughters, was described as being bounded on the “south by house and lot of Eobt. M. Farrar,” who was then in possession of the premises. This lot is the one now in controversy. In the will of Matilda F. Harris she undertook to devise only her half interest in the house and lot which had been occupied by Mrs. Maria L. Harris prior to her death, and reference was made to her will for a more particular description of this lot. An investigation of Mrs. Far-rar’s claim of title would have disclosed to Lewman that she got no estate by inheritance from her mother, but derived such title as she had under the will of her mother and the subsequent will of her sister, Matilda. The recitals to the contrary in the deed from Josephine E. Harris to Mrs. Farrar were untrue, as an examination of the records by Lewman at the time of making the loan to Mrs. Farrar would have demonstrated. The records disclosed, not only that Mrs. Harris died testate, but that in her will she recognized that the house and lot forming the southern boundary of her home place and then being occupied by Farrar belonged to him and formed no part of her estate. In view of this unequivocal disclaimer of ownership on the part of Mrs. Harris, no one would be warranted in assuming that the lot in controversy passed under her will ás a part of the residuum of her estate. Lewman thus had constructive notice that Mrs. Harris recognized the title- to this lot to be in Robert M. Farrar, and therefore is not in a position to assert that he stands in the attitude of an innocent purchaser without notice of the unrecorded deed from her to Farrar.
The foregoing discussion disposes of all the questions presented with which it is necessary to deal. The court below very fully and fairly submitted to the jury the only issue which was really involved in the controversy, and their finding upon this issue should, we think, be allowed to stand.

Judgment on main bill of exceptions reversed; on cross-bill affirmed.

All the Justices concur, except Lumplcin, J., disqualified, and Beck, J., not presiding.