Burhans et al. v. Van Zandt et al.

Burhans et al. v. Van Zandt et al. Estoppel. — Adverse possession. — Constructive Trust The representatives of the plaintiff in a chancery suit, are estopped from litigating, in another action, the validity of a deed, which was directly in issue and determined in the former one. The purchaser at a judicial sale of the life-estate of a judgment-debtor, does not hold adversely to the reversioner. If a tenant for life, in possession, acquire title to the undivided interest of one of the reversioners, and suffer the property to be sold for a municipal assessment, and himself become the purchaser, he cannot hold for his own exclusive benefit; the title thus acquired inures to the common benefit of the several parties in interest. Burhans v. Van Zandt, 7 Barb. 91, reversed. Appeal from the general term of the Supreme Court, in the third district, where a decree had been made, dismissing the plaintiffs’ bill, without prejudice to their remedy at law. (Reported below, 7 Barb. 91.) This was a bill in equity, filed in the late court of chancery, by Hannah Van Antwerp and others, to set aside a purchase under a municipal assessment, as a fraud upon the rights of the complainants, and to compel a surrender of the premises to David Burhans, their trustee. On the 14th August 1816, Thomas Van Zandt being seised in fee of a block of ground, in the city of Albany, bounded east by South Pearl street, south by Beaver street, west by Market square, and north by the public market, executed a deed of trust, whereby he conveyed the premises to Daniel L. Van Antwerp, his brother-in-law, in trust to pay the income thereof to himself, the grantor, during his lifetime, and after his decease, to pay the income to Hannah Van Antwerp, his sister, the wife of the grantee, during life, and at her decease, to convey the premises to their children (named in the deed), or to such of them as should be then surviving, as tenants in common in fee. David Burhans, one of the plaintiffs, was, on the 30th January 1843, appointed trustee by the court of chancery, in the place of Daniel L. Van Antwerp, who died in 1832. In February 1821, John Van Zandt, a brother of Thomas Van Zandt, the grantor, obtained a judgment against the latter for $1728.78; and by virtue of an execution issued thereon, the right, title and interest of the judgment-debtor, in the premises in question, were sold by the sheriff to William J. Van Zandt, a son of John Van Zandt, the plaintiff in the execution, for the sum of $1000. On the 15th October 1822, the sheriff executed a deed to the purchaser. On the 20th August 1828, William J. Van Zandt filed his bill in chancery against Daniel L. Van Antwerp, his wife and their children, alleging that he had acquired an absolute title to the premises, by virtue of the sheriff’s deed, and that the trust-deed of 1816 was fraudulent and void, and a cloud upon his title; and praying that it might be so declared, and he quieted in his possession. The defendants answered, insisting upon the validity of the trust-deed, and alleging that the judgment, sale and conveyance, under which the plaintiff claimed, were colorable, fraudulent and void as against them. Proofs were taken; and upon a hearing upon the pleadings and proofs, a decree was made on the 21st October 1833, dismissing the bill, with costs. On the 27th November 1834, Stephen L. Van Antwerp, one of the children of Hannah Van Antwerp, and one of the cestuis que trust in remainder, released his right, title and interest in the premises to William J. Van Zandt, the purchaser of the life-estate. Thomas Van Zandt died in April 1842. On the 5th April 1836, whilst William J. Van Zandt was in possession, and receiving the rents, the premises were sold to satisfy a municipal claim, in favor of the City of Albany, for an assessment of $195.75, for the widening of Beaver street; at the sale, Robert Packard became the purchaser, for the term of 1000 years; he received the usual certificate of sale from the corporation;. and on the 20th July 1848, conveyed his interest in the premises, by indorsement upon the declaration of sale, to the said William J. Van Zandt. The bill in this suit charged, among other things, that William J. Van Zandt, the defendant, being in the possession and enjoyment of the premises, as the purchaser of the life-estate of Thomas Van Zandt, was bound in equity to protect the estates in remainder and in expectancy, depending on the termination of the life-estate; to keep down any incumbrances upon the premises, to pay off and satisfy all reasonable assessments and taxes thereon, and to save from sacrifice the several rights, interests and estates of the plaintiffs; that the sale to Packard was fraudulently procured by William J. Van Zandt, for the purpose of cutting off the plaintiffs’ rights; and they insisted, that it was a violation of his duty, and was fraudulent and void. The answer alleged, that the trust-deed was procured by undue influence, that the defendant took possession immediately after the sheriff’s sale, with the knowledge of the plaintiffs, and had ever since held the same, claiming as owner in fee; and that he had, with the knowledge of the plaintiffs, made large and valuable improvements upon the premises, besides the payment of over $200 for the redemption thereof from the sale under the municipal assessment for widening Beaver street. A replication was filed, and the cause referred to a referee to hear the proofs and allegations, and determine the matters in controversy, with a proviso, that either party might bring the cause to a hearing, upon the report of the referee, or upon a case to be settled as provided in the order. The referee reported that the trust-deed was duly executed and delivered, and conveyed the premises to the grantee named therein, in trust for the purposes therein specified. That the defendant, by his redemption of the sale under the municipal assessment, acquired no title as against the other parties in interest. That he should release to the plaintiff Burhans, as trustee, the title so acquired; and should deliver up the possession. That he should account for the rents and profits, since the death of Thomas Van Zandt, with interest thereon, with an allowance for all permanent improvements and all assessments, and other'proper charges, since the death of of the tenant for life; and that a reference should be directed to take an account thereof. William J. Van Zandt died, after the filing of the report, and on the 26th October 1848, his heirs and personal representatives were substituted as parties defendant. Exceptions were taken to the referee’s report, and the cause was brought to a hearing upon the report and exceptions, together with a case settled in pursuance of the order of reference. The supreme court, on the hearing at general term, dismissed the plaintiffs’ bill, without costs, and without prejudice to their rights at law; whereupon, they took this appeal. Van Burén, for the appellants. Stevens, for the respondents. [MAJORITY — ''Gardiner, J.] ''Gardiner, J. I am inclined to the opinion, that the decree dismissing the bill of William J. Van Zandt, absolutely, and without reservation, was conclusive evidence of the validity of the deed executed by Thomas Van Zandt to Van Antwerp, on the 14th of August 1816. The decision was after proofs taken, and upon the merits, and I am unable to perceive, why this case should be excepted from the general principle, that a party shall be concluded from insisting in his defence to a second suit between the same parties, or their representatives, upon piatters which were actually litigated and determined against him in a former one. (5 Conn. 550; 8 Id. 268; 2 Cow. & Hill’s Notes 826.) In the first suit, in which William J. Van Zandt was complainant, and the trustee, and cestuis que trust under the deed of settlement, were defendants, the validity of that conveyance was affirmed by one party and denied by the other. The evidence was directed to this issue, and the decree above alluded to cannot be upheld, except upon the supposition that the court of chancmy determined that issue in favor of the defendants. It was argued, that the deed could f.-vly operate as a deed of bargain and sale, and as such, it was void for want of a pecuniary consideration, and that this question was not presented or determined in the former suit. The answer is, that the question is not made in this case by the pleadings, nor was it raised in the court below, so far as we can judge from the opinion before us. William J. Van Zandt, in his answer, nowhere claims that the conveyance was not effectual between the parties to it, if obtained without fraud. The objection is of the most technical character (3 Johns. 492), and in this stage of the proceedings, may be properly met by a technical answer. * Again, the referee in this cause has found, and in this finding the supreme court concur, that if this controversy was res nova, there is not evidence to impeach the deed of settlement. By this conveyance, if we assume its validity, the fee of the premises rested in Van Antwerp, in trust for “the use and benefit of the grantor, during his life, then for the use of Mrs. Van Antwerp, his sister, for life, at her death to be conveyed in fee to her children.” The deed was duly recorded, but the grantor, having the beneficial interest in the property for life, remained in possession, with the assent of the trustee, and received the rents and profits. Under these circumstances, the judgment in favor of John Van Zandt was obtained, and the interest of- Thomas in the property, sold by the sheriff. Thomas had no right or title, legal or equitable, at this time, in this property, but that which was secured him by the deed of settlement; his possession was consistent with that deed, and whether he is considered as tenant at the will of the trustee, or for life, in either case, it was in subordination to the title and estate which he had voluntarily conveyed to his trustee. William J. Van Zandt, the purchaser at the sheriff’s sale, could acquire no higher right than that of the debtor. (2 Ves. sen. 481; 18 Johns. 94.) He succeeded to the possession of Thomas Van Zandt, with all its incidents. (Jackson v. Graham, 3 Caines 188.) He was, therefore, like the judgment-debtor, bound to surrender the possession held under the trustee, in virtue of the deed of settlement, before he could question the right of the former, or lay the foundation of an adverse possession. There was no claim inconsistent with the rights of those holding or claiming an interest under the deed, until September 1828, when the purchaser filed his bill to set aside the settlement, as fraudulent. Up to this time there was no apparent change of possession; Thomas Van Zandt continued to receive the rents, or some p&rt of them, and there was nothing to indicate that William J. Van Zandt claimed in hostility to the deed executed by Thomas. From 1828 to the commencing of the ejectment suit by Mrs. Van Antwerp, in October 1842, was *fourteen years, and to the ~ filing of the bill, in September 1845, about seven- *- teen years only. The statute of limitations has not run, therefore, so as to bar the rights of the complainants, nor can the commencement and prosecution of the first suit by William J. Van Zandt, be claimed as in any way changing his relation to the cestuis que trust. That litigation, as we have seen, terminated in establishing that William J. Van Zandt acquired no right under the sheriff’s deed, to the prejudice of those claiming under the settlement; on the contrary, the decision established that the title of the purchaser, whatever it was, was in subordination to the deed to Van Antwerp. William J. Van Zandt acquiesced in that decision, as correctly settling the rights of all parties, and, after purchasing the right of one of the cestuis que trust, set himself to defeat the interests of his equitable co-tenants, by a redemption or re-purchase of the premises which he had suffered to be sold for a small assessment. The learned judge, whose opinion is before us, seems to think, that it cannot be supposed that he intended to abandon his title by the purchase from Stephen L. Van Antwerp, and, if he did not, he was authorized, being in possession^ to purchase an outstanding title, without changing the character of his claim. The answer is, that he had preferred that claim, for the first time, in the court of chancery, which had determined against it as early as October 1833. He acquiesced, as we have seen, in the judgment of the tribunal to which he had appealed. Under these circumstances, the more legitimate presumption would seem to be, that, in his opinion, the decision was just, and that he intended to abide by it, instead of repudiating it by insisting on an absolute title to the whole premises. Accordingly, he subsequently purchases the interest of Stephen L. Van Antwerp, one of the cestuis que trust in remainder. The.primd facie inference from the act is, that the purchaser believed that the vendor had some interest, existing or contingent, under the settlement, rather than that he had nothing to sell. The presumption is not weakened by the fact, that a court of equity, after a contestation, had -j pronounced in favor of *the conveyance. He next -* suffers the property to be sold to a friend, for a trifling city tax, with ample resources — the issues of the premises in question — in his hands at the time; and subsequently, on the 20th of July 1838, he procured an assignment from Packard, the vendee of the city, and paid him as he alleges in his answer, $200 for the “ repurchase and redemption of the premises.” The conduct of the defendant in these particulars, seems rather to indicate a design to forego his claim to an exclusive title under the deed of the sheriff, in order to secure to himself the fee through the tax-sale. At all events, the most that he can claim for his acts and declarations is, that they are equivocal. There can beno injustice, therefore, in limiting this defendant to the rights which he actually possessed in law and equity, and in holding him to the responsibilities which those rights, and the relations arising from them, imposed upon him. If he repudiates the title which the law adjudges to him, in order to establish an adverse possession, his acts should, at least, be unequivocal. If we are right in this, the case is disposed of. The defendant, William J. Van Zandt, obtained by voluntary purchase, the interest of one of .the cestuis que trust, and thus became-a co-tenant with the other children of Mrs. Van Antwerp, in equity, in the remainder secured to them by the deed of settlement. Under these circumstances, while in possession, as we have seen, under f1- * conveyance, he could not rightfully redeem or purchase the common property for his exclusive benefit; the cases of Van Horne v. Fonda (5 Johns. Ch. 388) and Holridge v. Gillespie (2 Id. 30) are full to this point. He represented the interest of Thomas, who was entitled to the rents and profits of the premises for life, and the share of Stephen L. Van Antwerp, one of the remainder-men, and was bound to protect the interest of those who stood in the same relation with himself to the property. So far from doing this, the whole transaction in reference to the sale by the corporation of Albany, the purchase by Packard, and the assignment to the defendant, was obviously collusive, and designed to vest the estate in the latter, to the prejudice of *all others interested in the premises. The sum *- paid for the redemption or repurchase, shows- that the original purchase by Packard was not for himself but for his friend. No sane man would have suffered the sale of valuable property, yielding a large income, to pass from him in this way, without some understanding, express or implied, that it should be reconveyed. Indeed, in his answer, the defendant does not set up the title acquired by the assignment, but only insists upon the sum paid on the repurchase and redemption, in connection with other liens there mentioned, as having been discharged by him. The judgment of the supreme court, for the reasons assigned, should be reversed, and a decree entered substantially in accordance with the decision of the referee. Judgment reversed. The decree of a court of chancery, dismissing a bill upon its merits, is conclusive between the parties. Kelsey v. Murphy, 26 Penn. St. 78. It is as conclusive as a judgment at law. Westcott v. Edmunds, 68 Ibid. 34.