ÆäÀÌÁö À̹ÌÁö
PDF
ePub

sum of $46, for which the same was sold; and that the payment by him of the purchase money at such tax sale was but the payment of the taxes and expenses, which he was under obligation to pay." The prayer of the bill is: (1) That the tax sale may be declared void; (2) that the deed from the collector may be declared void, and be vacated and annulled; (3) that a decree may be passed declaring the appellant to be seised in fee of the reversion in said lot, and to be entitled to collect the rent reserved in the original lease from Ellinger. The appellee demurred to the bill, and assigned the following grounds: (1) That the bill stated no sufficient case to entitle the plaintiff to relief; (2) that the court had no jurisdiction to hear and determine the matter; (3) that the plaintiff's remedy, if any, was in a court of law; (4) that there was a full, complete, and adequate remedy at law; (5) that the plaintiff had neither the legal title to nor the possession of the property.

At the hearing the court sustained the demurrer, and dismissed the bill, holding in the opinion filed that, as there was no allegation of possession by the plaintiff at the time the bill was filed, the case was governed by the case of Textor v. Shipley, 77 Md. 474, 26 Atl. 1019, 28 Atl. 1060, and those which preceded it, in all of which it is held that there must be such averment of possession, followed by proof, to warrant a decree for plaintiff. There can be no doubt that such is the general rule of equity, and that as such it is firmly established in this state by numerous decisions. In Helden v. Hellen, 80 Md. 621, 31 Atl. 506, 45 Am. St. Rep. 371, where a bill filed to remove a cloud upon the title failed to allege possession by the plaintiff, the bill was dismissed on demurrer; the court saying: "If the possession is in another, the remedy is by an action of ejectment. * * * Whatever may be the decisions elsewhere, no case in this state has gone so far as to maintain a bill in equity under the facts and circumstances of this case." And the rule was reaffirmed in Keys v. Forrest, 90 Md. 132, 45 Atl. 22, the latest case upon the subject in this court. But, while this is the general rule, there are some recognized exceptions to its application. In Crook v. Brown, 11 Md. 172, applying the general rule to the facts of that case, Judge Tuck said: "We know of no head of equity jurisdiction under which this [amendment to the bill] can be maintained. It would be substantially to give to a chancery suit the effect of an action in ejectment.

There are some circumstances under which courts of equity will remove a party in possession, and put in another, but these are cases of peculiar character." So, in Livingston v. Hall, 73 Md. 395, 21 Atl. 49, Judge Alvey said: "To maintain a suit of this character, it is, as a general rule, necessary that the plaintiff should be in the possession of the property." And in Steuart v. Meyer, 54 Md. 467,-a case arising under a tax sale of

property subject to ground rent,-relief was granted notwithstanding the plaintiffs were not in possession; Judge Alvey saying: "They are interested only in the annual ground rents and in the estate of the reversion. They are not entitled to the possession, and could not, therefore, sue in ejectment for the recovery of the property. Under the circumstances of this case, without resort to a proceeding like the present, the parties would be without adequate remedy for relief against the effect of the prima facie title in the purchaser." In Textor v. Shipley, 77 Md., 26 Atl., 28 Atl., supra, it was argued that the decision in Steuart v. Meyer was in conflict with all the other cases in this court on that subject, and overruled the previous cases, but the opinion filed by Judge Robinson on the reargument in Textor v. Shipley, in which Judge Alvey concurred, explained what were the circumstances alluded to by him in Steuart v. Meyer, and showed that in that case, when the bill was filed, the property in controversy was in the possession of receivers appointed by the court, and that the plaintiff could not resort to the ordinary remedy by ejectment against Meyer as a disseisor, for the reason that he was not in possession of the property, and that in maintaining the jurisdiction of equity under the peculiar circumstances of that case it was not meant to question the general rule laid down in the earlier cases; "that those only who have a clear legal and equitable title to land, connected with the possession, have any right to claim the interference of a court of equity to give them peace, or dissipate a cloud on title." There are decisions elsewhere from courts of repute that actual possession by a tenant is equivalent to actual possession by the landlord for the purpose of such a bill, but these are not consistent with the decision in Steuart v. Meyer, as explained in Textor v. Shipley, and need not be referred to. There are, however, well-established legal principles applicable to the facts of this case, which, in our opinion, take it out of the general rule, and bring it within the exceptions in which equity has jurisdiction. These principles cannot be better stated than in the language of Judge Cooley, extracted from his Law on Taxation: "Some persons, from their relation to the land or to the tax, are precluded from becoming purchasers, on grounds which are apparent when their relation to the property and to the taxes is shown. The title to be given on a tax sale is a title based on the default of the person who owes to the public the duty to pay the tax, and the sale is made by way of enforcing that duty. But one person may owe the duty to the public, and another may owe it to the owner of the land, by reason of contract, or other relations. Such a case may exist where the land is occupied by a tenant, who, by his lease, has obligated himself to pay the taxes. Where this is the relation of the parties to the land, it would cause a shock to the moral sense if the law

were to permit this tenant to neglect his duty, and then take advantage thereof to cut off his lessor's title by buying in the land at a tax sale. * There is a general principle applicable to such cases, which may be stated thus: That a purchase made by one whose duty it was to pay the taxes shall operate as a payment only. He shall acquire no right, as against a third party, by a neglect of the duty which he owed to such party. This principle is universal, and is so entirely reasonable and just as scarcely to need the support of authority. Show the existence of the duty, and the disqualification is made out in every instance." A long list of cases illustrating the application of the principle thus stated under a great variety of circumstances is given in a footnote to the text, and a valuable note on the same subject will be found upon page 939 of 53 L. R. A., appended to the case of Smith v. Newman (Kan.; 62 Pac. 1011), in which it is said that the cases are all agreed that a tenant cannot acquire a valid title, as against the landlord, by virtue of a tax sale during the tenancy for taxes which the tenant had agreed to pay. Among these may be cited the folowing: "At most the tenant could only become seised under the tax deed in trust for his landlord if living; if dead, then for his heirs or their assigns." Burgett v. Taliaferro, 118 Ill. 516, 9 N. E. 334. "Payment of taxes by a tenant at a tax sale will be considered as a redemption of the land for his landlord, and he will remain his tenant as before." Williamson v. Russell, 18 W. Va. 625. "In such case the tenant can acquire no valid title as against such owner, but would hold any title thus acquired in trust for such owner." Bertram v. Cook, 32 Mich. 519. "A tax purchase, made while such relation exists, is made in wrong; and the law, in circumvention of dishonesty, will conclusively presume that it was made in performance of duty, and not in repudiation of it." Conn. Mut. Life Ins. Co. v. Bulte, 45 Mich. 120, 7 N. W. 707. "A title so acquired would remain void in the hands of a bona fide purchaser without notice." Blake v. Howe, 1 Aikens, 306, 15 Am. Dec. 681. "Where a lessee covenanted to pay all taxes and assessments on the demised premises during the term, he was bound to pay a special assessment for planking and curbing the sidewalk in front of the premises; and where he disputed this liability, and permitted the lot to be sold to pay this assessment, and after the expiration of the term became the assignee of the purchaser, and took the tax deed, the lessor was held entitled to a judgment that the lessee quitclaim the premises to him, and that he be restrained from conveying or incumbering them." Shepardson v. Elmore, 19 Wis. 424. Some of these cases were actions of ejectment; others, and notably the last cited, were bills to remove cloud upon title. To the same effect are the cases of Stout v. Merrill, 35 Iowa, 47; Haskell v. Putnam, 42 Me. 244; Willard v. Ames, 130

Ind. 351, 30 N. E. 210; Reily v. Lancaster, 39 Cal. 354; Coxe v. Gibson, 27 Pa. 160, 67 Am. Dec. 454; Rothwell v. Dewees, 2 Black, 613, 17 L. Ed. 309; Lamborn v. Dickinson County Commissioners, 97 U. S. 181, 24 L. Ed. 926.

It is true that in an action of ejectment this plaintiff would be entitled to recover upon proof of the facts she alleges in her bill, but it does not follow that equity has not jurisdiction to grant the relief prayed, and we think an examination of the authorities will show that it is our duty to sustain this bill, and not to send the plaintiff to a court of law. In Hamilton v. Cummings, 1 Johns. Ch. 523, a bill was filed praying the delivery up and cancellation of certain bonds executed by the plaintiff's testator, which it was charged were given to indemnify defendant as bail in certain suits, but which were to be surrendered and canceled if defendant was not damaged or put to costs. The bill alleged that the suits were all settled, and that defendant had been put to no costs or damage. In considering the objection made to the jurisdiction of equity in that case, Chancellor Kent said: "I am inclined to think that the weight of authority and the reason of the thing are equally in favor of the jurisdiction of the court, whether the instrument is or is not void at law, and whether it be void from matter appearing on its face, or from proof taken in the cause. * But while I assert the authority of the court to sustain such bills, I am not to be understood as encouraging applications, where the fitness of the exercise of the power of the court is not pretty strongly displayed. Perhaps the cases may be reconciled on the general principle that the exercise of this power is to be regulated by sound discretion, as the circumstances of the individual case may dictate; and that the resort to equity, in order to be sustained, must be expedient, because the defense, not arising on its face, may be difficult or uncertain at law, or from some other special circumstances peculiar to the case, and rendering a resort here highly proper, and clear of any suspicion of any design to promote expense and litigation." In Van Horne v. Fonda, 5 Johns. Ch. 406, two devisees were in possession of lands under an imperfect title devised to them by their common ancestor, and it was held that one of these could not buy up an adverse title to disseise or expel his co-tenant, but that such purchase would inure to their common benefit, subject to an equal contribution to the expense; and the same high authority said: "It is not consistent with good faith, nor with the duty which the connection of the parties, as claimants of a common subject, created, that one of them should be able, without the consent of the other, to buy in an outstanding title, and appropriate the whole subject to himself, and thus undermine and oust his companion. It would be immoral, and repugnant to a sense of refined and accurate

justice." Accordingly, the chancellor sustained a bill for an account filed by the devisee sought to be ousted under the adverse title bought by his co-devisee. That case was relied on as conclusive by Chancellor Cooper in Harrison v. Winston, 2 Tenn. Ch. 544, in which it was held that a beneficiary under a trust assignment for the benefit of creditors, who is a party to the suit for the execution of the trust, consenting thereto, and accepting its benefits, cannot acquire a title to any of the property under a tax sale free from the trust; and that one who joins with him in the purchase with knowledge of his fiduciary relations will stand in no better position; and that the complainant was entitled to a decree perpetually enjoining an action of ejectment brought by the purchaser of the tax title, and declaring that the tax title inured to the benefit of the trust.

Applying the principles thus declared to the case before us, we cannot say, as was said in Crook v. Brown, supra, "we know of no head of equity jurisdiction under which this can be maintained." We perceive at once that upon the allegations of the bill there was fraud in the acquisition by defendant of the tax title, and that, as a result of this fraud, the title is held by the defendant in trust for the plaintiff, and we know that fraud and trusts are independent heads of equity jurisdiction. In King v. Carpenter, 37 Mich. 366, it was held that, "where a party has an equitable cause of action against another, coming within any recognized rule of equity jurisdiction, such right can be enforced in equity, whether the complainant is in possession or not." In Sheppard v. Nixon, 43 N. J. Eq. 633, 13 Atl. 617, the court said: "The exception to the rule [that the plaintiff must be in possession] is where the case presents some special ground for equitable interposition, such as fraud, accident, or mistake, requiring the setting aside or reformation of deeds or instruments of conveyance. If these elements be wanting, a bill to establish complainant's title is an ejectment suit, pure and simple." To the same effect is Essex County Bank v. Harrison (N. J. Ch.) 40 Atl. 211. And in Security Savings & Trust Co. v. Mackenzie (Or.) 52 Pac. 1046, it was held that the question of possession of real estate, as required by a statute of the state, in a suit for an interest therein, was immaterial, when the relief sought is such that an equity court has jurisdiction independent of the statute. This view of the law is sustained in 17th Enc. of Pleading & Practice, 309, where it is said: "Where there is any other distinct head of equity jurisdiction sufficient to support the action, possession by the plaintiff is not required, but equity will retain the cause, and grant relief by quieting the title or removing clouds." In the present case fraud in the acquisition of the title is distinctly charged; such fraud as would raise a trust in favor of the plaintiff. The defendant has demurred, and the effect of his demurrer is

to admit all matters of fact well pleaded, and we think the fraud is well pleaded. Again, in 17th Enc. of Pleading & Practice, 311, it is said that "it would seem that ejectment is an inadequate remedy in all cases where, although the plaintiff might recover possession, a void instrument or muniment of title would be left outstanding and uncanceled," and it was so held in Redmond v. Packenham, 66 İll. 434. Here, if the plaintiff were to recover in ejectment, the tax title would remain outstanding, and would, after such recovery, still constitute an apparent cloud upon the title whenever the property might be upon the market. Consequently, we think the demurrer should have been overruled and the bill retained.

Nothing that we have said, however, is to be understood as overruling or impairing the authority of any of the previous cases in this court, none of which presented the question now before us. In Keys v. Forrest, supra, the case was not presented on demurrer, but was heard upon bill, answer, and testimony. The bill alleged, and the answer denied, fraud in the acquisition of the tax title; and it will be seen on reference to the record that the lower court considered the allegation of fraud, and found it was not sustained, and this court concurred in that finding. Had the possession by the plaintiff been essential in that case, it would have been idle to determine the question of fraud. There is therefore no conflict or inconsistency between this case and any of the earlier cases in this court. For the reasons given, the decree of the circuit court will be reversed.

Decree reversed, with costs to the appellant above and below, and cause remanded for further proceedings.

(96 Md. 514)

SNOOK v. MUNDAY. (Court of Appeals of Maryland. Jan. 23, 1903.)

PRINCIPAL AND SURETY-ESTOPPEL-RIGHT OF SUBROGATION-TENDER-PLEADING -AMENDMENT-APPEAL.

1. Under Code, art. 16, § 16, providing that a party to a bill in equity shall have the right, on payment of such costs as the court may di rect, to amend so as to bring the merits fairly to trial, the application to amend is addressed to the discretion of the court, and there is no appeal from an order permitting an amendment.

2. Where a wife, as surety for her husband, joined him in a mortgage which stated that "the debt is a joint and several one," in an action praying leave to pay the debt and be subrogated to the rights of the mortgagee she may show that she was simply surety, though she could not do so to defeat the mortgage.

3. Where, in a suit by a surety to a debt secured by mortgage for leave to pay the debt and for subrogation to the rights of the mortgagee, the plaintiff alleges that she endeavored, but failed, to ascertain the exact amount due, and then paid into court a sum in excess of

1. See Appeal and Error, vol. 2, Cent. Dig. §§ 582, 706.

the debt, interest, and costs, the tender was sufficient.

Appeal from circuit court, Washington county, in equity; Edward Stake, Judge.

Action by Elizabeth Munday against Catherine Snook. From a judgment in favor of plaintiff, defendant appeals. Affirmed.

Argued before McSHERRY, C. J., and FOWLER, BRISCOE, BOYD, PAGE, PEARCE, SCHMUCKER, and JONES, JJ.

Thompson A. Brown and Chas. A. Little, for appellant. Alexander Armstrong and Samuel B. Loose, for appellee.

PAGE, J. John Munday, deceased, in his lifetime, together with the appellee, executed a mortgage upon certain lands to secure the payment of $1,600, evidenced by two promissory notes in favor of Edward Mealey. The appellee, who, under the last will of John Munday, is the life tenant of the mortgaged property, filed a bill in the circuit court for Washington county praying for the writ of injunction to restrain the appellant, as assignee of the debt and mortgage, from making a sale, and for a decree requiring the appellant to receive from her, as the surety of John Munday, the money due and owing, so that she may stand in the place of the mortgagee, and be subrogated to all of his legal and equitable rights. This bill was also demurred to by the appellant, the demurrer was overruled, and a decree passed allowing the relief prayed for, whereupon the appellant took this appeal.

One of the contentions in support of the demurrer made by the appellant is that the amended bill is not an amendment of the old one, but in fact a new bill, which the court should not have permitted to be filed. But an application to amend is addressed to the discretion of the court before whom it is made, and is not the subject of an appeal to this court. In Calvert v. Carter, 18 Md. 108, where the court was considering the effect of the act of 1854, c. 230, now article 16, 16, of the Code. it was said: "The best construction we have been able to give it is that it was intended to enlarge the time within which the amendments may be made in proceedings in equity. Formerly the 'proper time' to apply for leave to amend was before the cause was at issue. The act authorizes amendments to be made at any time before final decree. They are still to be made 'on application to the court,' 'so as to bring the merits of the case fairly to trial.' The court to which the application is made must of necessity judge of the propriety of the proposed amendment.

*

We think the act of 1854 must be construed in the same way. It does not, in terms, confer any right of appeal, and we think none exists." The relief prayed for in the bill is based upon the claim of the appellee that she is "simply" the surety of her husband. An additional contention of the appellant is

that the complainant cannot now set this up, because of the fact that by the terms of the mortgage it is established that "the debt is a joint and several one." But this is not a proceeding between the payors and the holders of the note, nor is there any attempt to deny the liability of the appellee as a joint maker. The allegation of her suretyship, only, is not made to alter or vary her liability to the payee, but solely for the purpose of proving her relation to her comaker. If, in fact, whatever may be the form of the transaction, as between herself and her co-maker she is a surety only, it would be contrary to the principles of equity for the creditor to permit, or by his conduct to cause, her co-maker, the principal debtor in fact, to be exempt from payment, or from liability to his surety to make good what the latter has paid on his account. This is an equity binding upon the conscience of the creditor, though not within the actual words of the contract. All the rights of co-sureties inter sese rest upon this principle. "Subrogation," says Sheldon (page 3), "as a matter of right, independently of agreement, takes place for the benefit of a co-obligor or surety who has paid the debt which ought, in whole or in part, to have been made by another." See, also, as to the basis of the right of contribution between sureties, Dering v. Earl of Winchelsea, 1 Cox, 318; Stirling v. Forrester (0. S.) 3 Bligh, 590. When, therefore, the true relations of co-makers of a note, inter sese, are in issue, or, in plainer terms, where the question at issue is not the contract between the makers and the payees, but the measure of obligation between the makers, parol evidence establishing the, true relations between themselves does not vary the terms of the contract as evidenced by the note, and may therefore be offered in evidence. Mansfield v. Edwards, 136 Mass. 15, 49 Am. Rep. 1; Clapp v. Rice, 13 Gray, 403, 64 Am. Dec. 639; Sweet v. McAllister, 4 Allen, 355; Nurre v. Chittenden, 56 Ind. 462; Melms v. Werdehoff, 14 Wis. 18; Carpenter v. King, 9 Metc. (Mass.) 511, 43 Am. Dec. 405; Barry v. Ransom, 12 N. Y. 462; Montgomery v. Page, 29 Or. 320, 44 Pac. 689; Weston v. Chamberlin, 7 Cush. (Mass.) 404; Phillips v. Preston, 5 How. 278, 12 L. Ed. 152. This court also has applied the same doctrine in Chapman v. Davis, 4 Gill, 179,-an action of assumpsit brought by Davis, as executor, to recover money paid by his decedent on account of a promissory note signed, as co-makers, by Chapman and Davis. The contention on the part of the latter was that while his decedent was apparently a joint obligor, he was in fact a surety only for Chapman, and therefore, having paid part of the obligation, he was entitled to recover it from the estate of Chapman, the principal. To establish this relation toward each other, he offered evidence that, at the time the note was signed, both were members of the vestry

of Port Tobacco Church. On objection, the lower court rejected this evidence, but on appeal this court reversed the ruling; saying, as it did so, that "the fact proposed to be proved by the defendant was material to the issue, as the jury might have found from the position of Davis, as a member of the vestry, in connection with other testimony, that he intended to sign the note in question, not as the surety of Chapman, but as a principal obligor." It seems to be clear that, if she is at liberty to prove by parol testimony that her true position as between herself and her co-maker was that of surety only, it was proper (indeed, in this case it was imperative upon her) to allege it in the bill. The demurrer admits the averment to be true, and therefore, being a surety, she is entitled to pay off the debt of her principal, and be subrogated to all the rights of the creditor. Freaner v. Yingling, 37 Md. 497.

With respect to the tender of the money due, we think the allegations of the bill are sufficient. It appears therefrom that the appellee sought, but failed, to ascertain the exact amount due. She then paid into court a sum more than sufficient to pay the debt, with all proper interest and costs. Chicora Co. v. Dunan, 91 Md. 144, 46 Atl. 347, 50 L. R. A. 401; Maughlin v. Perry & Warren, 35 Md. 358.

The order will be affirmed, with costs, and the cause remanded, that the defendant may answer. Order affirmed, with costs, and remanded.

(96 Md. 495)

REICHARD et al. v. IZER et al. (Court of Appeals of Maryland. Jan. 22, 1903.) WILL CONTEST-OPPOSITION TO CAVEAT-ES

TOPPEL-EXPLANATION-SUFFICIENCY.

1. Certain of testator's heirs filed a petition protesting against a caveat filed against the will by a brother and sister of petitioners, and alleged that they had peculiar means of knowledge of the circumstances attending the making of the will, and that all the allegations made against the validity of the will were untrue, to their personal knowledge. The petition prayed that the administration be continued by the executors, and that the petitioners be made parties caveatees. The caveat was dismissed, and thereafter petitioners sought to contest the will on the same grounds alleged in the original caveat. In explanation of this action, they alleged that when they signed the original petition they were ignorant of the true facts surrounding the execution of the will, and signed the petition at the instance of the executors, and that, having taken their position with the caveatees, they were not in a position to ascertain facts which since came to their knowledge. It was alleged that one of the executors had stated that he knew the will could be set aside on the ground of fraud, but that it was better that the caveat should be dismissed, as a long litigation would have resulted; but it was not alleged when this statement was made, or to whom. It was also alleged that, after the signing of the first petition, one of the executors was required to produce vouchers for certain sums claimed by him, and that when he filed them the petitioners "were aroused to the import

ance of an investigation," and filed exceptions to the account. The account, as filed, contained some charges which should not have been allowed; but they amounted to but a few dollars, relating to the personal expenses of the executor, and had no bearing on the validity of the will. It was further alleged that the petitioners had learned, from letters written by one of the executors, of the exercise of undue influence by him, but the only letter relied on in support of this claim was one which was in possession of the caveators at the time the first petition was filed. Held not a sufficient explanation to justify the court in allowing petitioners to appear and contest the will in contradiction of their first petition.

Appeal from orphans' court, Washington county; Elias Cost, A. D. Sager, and Wm. L. Hammond, Judges.

Petitions by Nancy E. Izer and others against V. Milton Reichard and another, as executors of the will of Margaret Shipley, deceased. From an order allowing petitioners to appear as contestants of the will, the executors appeal. Reversed.

Argued before McSHERRY, C. J., and FOWLER, BRISCOE, BOYD, PAGE, PEARCE, SCHMUCKER, and JONES, JJ.

J. Clarence Lane, Henry H. Keedy, Jr., and M. L. Keedy, for appellants. Thompson A. Brown, John E. Wagaman, and Chas. D. Wagaman, for appellees.

BOYD, J. The question before us in this case is whether or not the appellees have made such allegations in their amended petition and caveat as were necessary to avoid the effect of the papers signed by them, and referred to in Reichard et al. v. Izer et al., 95 Md. 451 (s. c. 52 Atl. 592). As is shown in that case, Wynkoop Shipley and Emma F. Davis, a brother and sister of Mrs. Izer, had filed a caveat to the will of their mother, Margaret Shipley, which included the same grounds, in substance, as are now relied on by the appellees. While that was pending in the orphans' court of Washington county, Mr. and Mrs. Izer, and others interested in the will, filed, on February 12, 1901, a petition in that court, which was there called, and will be herein referred to as, "Exhibit B," in which they alleged "that all the allegations made against the validity of the said last will and testament, and codicil thereto, are untrue and unfounded in fact, and that the allegations therein made of undue influence, fraud, and misrepresentation, and alleged to have been exer cised by V. Milton Reichard and Edwin J. Farber, executors named in said will, are false and without any foundation in fact; and your petitioners, on the contrary, further show and allege, from their knowledge of the circumstances and surroundings of their deceased mother, and from their intimate knowledge and acquaintance with the said Reichard and Farber, that all of said allegations in said caveat, so far as they reflect upon the character and conduct of the said Reichard and Farber, are unjust, untrue, and unfounded in fact." They then protest

« ÀÌÀü°è¼Ó »