Opinion
No. 36425.
April 21, 1947. Suggestion of Error Overruled May 19, 1947.
1. GUARDIAN AND WARD.
Where validity of guardian's sale was attacked, decree for defendants must be held to imply a finding that purchaser paid required consideration and that sale was in good faith.
2. GUARDIAN AND WARD. Trusts.
Where possession had been taken under guardian's sale more than two years prior to action to annul sale, and purchase prices was paid in good faith, the wards were in no position to assert either the invalidity of sale or to claim a resulting trust therefrom, since any claim was barred by limitation (Code 1942, sec. 745).
3. TRUSTS.
A resulting trust transforms a prior intention of parties into an obligation by the grantee to hold and deal with land in recognition thereof.
4. TRUSTS.
Where all the parties deemed lands with existing loan a liability and the assumption of such obligation by the grantee was not only beneficial to the grantor but was in compliance with such intention, no resulting trust existed.
5. PARTITION.
In suit for partition of lands and for the fixing of a lien thereon to secure payment of any amounts of rent or other gains to be revealed by an accounting, finding that there was no bad faith on part of defendant who had purchased land from tenants in common was sustained by the evidence.
6. TRUSTS.
Where lands of tenants in common were encumbered by trust deed to Federal Land Bank and complainant tenant before conveyance of her interest to cotenant had authorized the other to use entire income for payment of expenses, that subsequent purchaser from complainant's grantee wrote complainant concerning the Federal Land Bank stock which was an adjunct of loan contract and referred to complainant's letter to her cotenant and assured complainant that the income would be utilized in conformity with her authorization, did not result in an enforceable obligation to reconvey to complainant her original interest or to hold it for her in trust.
ON SUGGESTION OF ERROR. (Division B. May 19, 1947.) [30 So.2d 513. No. 36425.]1. APPEAL AND ERROR.
Where there was evidence to sustain chancellor's finding that guardian's sale of minor's interest in realty was not for a grossly inadequate consideration, Supreme Court could not say that chancellor was manifestly wrong in his decree, though there was testimony to the contrary (Code 1942, sec. 745).
2. ESTOPPEL.
Where minors after becoming of full age, stood silently by for more than three years while purchaser of realty made large expenditures for improvements or betterments out of his own funds before they for the first time asserted their claim that their guardian's sale of their interest in the realty many years before was invalid because for a grossly inadequate consideration, doctrine of equitable estoppel applied.
APPEAL from the chancery court of Claiborne county. HON. R.W. CUTRER, Chancellor.
Satterfield, Ewing Hedgpeth and Dan H. Shell, all of Jackson, for appellants.
The sale of the interests of the minors in 1927 was void on its face and no person could be a bona fide purchaser without notice in reliance thereon.
Enochs Flowers, Ltd., et al. v. Bank of Forest, 172 Miss. 36, 159 So. 407; Allen v. Poole, 54 Miss. 323, 332; Mitchell v. Harris, 43 Miss. 314, 324; Allen v. Martin, 61 Miss. 78; Corley v. Myers, 198 Miss. 380, 22 So.2d 234, 575; Temple v. Hammock, 52 Miss. 360; Theobald et al. v. Deslonde et al., 93 Miss. 208, 46 So. 712; Shannon et al. v. Summers, 86 Miss. 619, 38 So. 345; Hemingway's Code of 1917, Sec. 1983; Laws of 1922, Ch. 228; Griffith's Mississippi Chancery Practice, Secs. 655, 656; 39 C.J.S. 211, 212, Sec. 131.
Even if the guardian sale had been valid and consideration had been paid for the conveyance by Mrs. Orah B. Jones, a resulting trust arose upon the execution of the conveyances and exists to this date.
Shepherd et ux. v. Johnston, 201 Miss. 99, 28 So.2d 661; Maas v. Sisters of Mercy of Vicksburg et al., 135 Miss. 505, 99 So. 468; Wilson v. Hoffman, 104 Miss. 743, 61 So. 699; 65 C.J. 363, 454, Secs. 139-212.
There is no statute of limitations which bars title of the appellants to the property here involved. No facts appear in this record upon which there may be invoked the ten year statutes of limitation or of adverse possession.
Code of 1942, Sec. 746.
The two year statute of limitations as to sale under decree of the chancery court (Section 745 of the Code of 1942) is not applicable in the case at bar.
Moores v. Flurry, 87 Miss. 707, 40 So. 226; Jeffries et al. v. Dowdle et al., 61 Miss. 504; Shannon v. Summers, 86 Miss. 619, 38 So. 345; Foster v. Gulf Coast Canning Co. et al., 71 Miss. 624, 15 So. 931; Sharpley et al. v. Plant, 79 Miss. 175, 28 So. 799; Smith et al. v. Strickland, 139 Miss. 1, 103 So. 782; Dendy et al. v. Commercial Bank Trust Co., 143 Miss. 56, 108 So. 274; Gibson v. Currier, 83 Miss. 234, 35 So. 315; Cusimano v. Spencer, 194 Miss. 509, 13 So.2d 27; Code of 1942, Secs. 738, 745.
The mere silence of the appellants in reliance upon the agreement of April 26, 1938, does not estop them from asserting the title otherwise vested in them and the elements of laches do not appear in this case.
Aetna Ins. Co. v. Robertson, 131 Miss. 343, 94 So. 7; Comans v. Tapley, 101 Miss. 203, 57 So. 567; Brantley v. Wolf, 60 Miss. 420; Meyerkort v. Warrington, 19 So.2d 433, 198 Miss. 29, 20 So.2d 708; Sample v. Romine, 193 Miss. 706, 8 So.2d 257.
There is nothing in the conference held by the families in the fall of 1937 which could invoke the principle of laches or estoppel, especially in view of the written recognition of the rights of the Joneses by Mrs. Annie P. Crawford, agent, thereafter the owner of the property.
Mobile O.R. Co. v. Swain, 164 Miss. 825, 145 So. 627, 629; Roberts v. Bookout, 162 Miss. 676, 139 So. 175.
James D. Thames, of Vicksburg, for appellees.
The chancellor's finding of fact are not reversible unless manifestly wrong.
Griffith's Mississippi Chancery Practice, p. 783, Sec. 674.
The alleged claim is barred by the statute of limitations.
Morgan v. Hazlehurst Lodge, 53 Miss. 665; Hubbard v. Massey, 192 Miss. 95, 4 So.2d 230; Code of 1942, Sec. 745.
The appellants allege that the facts under the law, impose a resulting trust upon the title of A.L. Arnold, Jr. This question is a factual question and not a legal question, and the chancellor specifically held that the facts were not sufficient to create a resulting trust. This finding is conclusive of this question on this appeal. Appellants predicate their position upon an alleged oral promise made in 1927 by Dr. John F. Crawford, now deceased, that he would hold the title to said lands for the use and benefit of Paul Jones, Silas Jones, Mary Jones Powell and an alleged later promise by Mrs. Crawford to hold the title for Mrs. Jones. The appellees denied the existence of these alleged oral promises. The chancellor determined that no such promise was made. These alleged oral promises constitute, if anything, expressed trusts which are void and unenforceable under Section 269 of the Code of 1942.
The appellants were guilty of laches.
Comans v. Tapley, 101 Miss. 203, 57 So. 567; Marks v. Toney, 196 Miss. 572, 18 So.2d 452; Sample v. Romine, 193 Miss. 706, 8 So.2d 257.
Bill was filed by Mrs. Jones and her children for partition of lands known as the Pecan Grove Plantation in Claiborne County, and for the fixing of a lien thereon to secure payment of any amounts of rent or other gains to be revealed by an accounting.
The lands were bought by J.J. Jones and J.F. Crawford in 1920. In 1922, grantees procured a loan secured by deed of trust thereon in favor of the Federal Land Bank. In 1925, Mr. Jones died intestate, his heirs being the appellants.
In July 1927, there was a sale by Mrs. Jones, as guardian of her three children, to Mrs. J.F. Crawford. The undivided one-eighth interest of each of such wards was conveyed, subject to the outstanding indebtedness, for and in consideration of the payment of $100 to each. In 1937, Mrs. Jones conveyed her interest to Mrs. Crawford. On January 24, 1938, Mrs. Crawford conveyed the entire interest, still subject to the said indebtedness, to her son-in-law, A.L. Arnold, Jr., one of the appellees.
The bill attacked the validity of the guardian's sale. It also sought to establish a resulting trust in complainants' favor arising out of the sales to Mrs. Crawford and the sale by her to Arnold.
There were irregularities in the guardian's sale which, if seasonably asserted, may have avoided it. The decree of the chancellor, which is sufficiently supported by the record, must be held to imply a finding that Mrs. Crawford paid the required consideration and that the sale was in good faith. Since the youngest of the wards became of age more than two years before suit was filed, the bar of Code 1942, Sec. 745, is complete. They are not, therefore, in a position either to attack the validity of this sale or to claim a resulting trust therefrom. Although there was some testimony that the value of the lands was in excess of the amount paid by Mrs. Crawford, such amount was that represented by the guardian in her petition as fair, and there is no such disparity as subjects the sale to suspicion of fraud.
Both the sales to Mrs. Crawford were induced by the common anxiety that the lands might be lost through the inability to make payments of taxes, interest and principal installments upon the loan. The lands were not being, and had not been, profitably operated. Also, both sales were in their outset contemplated to be effected to grantees other than Mrs. Crawford. Yet, in both cases the proposed grantees would not or did not take the property, and the sales to Mrs. Crawford were upon the same terms proposed respectively in each case. The sale by Mrs. Jones of her interest was to be upon the consideration that the prospective grantee would relieve her of any responsibility for the upkeep of the place and for payment of the existing loan. This, Mrs. Crawford did. Under her subsequent sale to Arnold, he informally assumed, and has made, all payments due thereon, and has expended considerable sums in maintenance and development.
A resulting trust transforms a prior intention of the parties into an obligation by the grantee to hold and deal with the land in recognition thereof. Here, there was no resulting trust since all parties deemed the lands, with its existing loan, a liability, and the assumption of such obligation by the grantee was not only benficial to the grantor but was in compliance with such intention.
On February 25, 1927, Mrs. Jones executed an instrument acknowledging her inability to bear any part of the expense of maintenance of the lands, and authorized Dr. Crawford, who held an undivided one-half interest, to use all income from the operations to reimburse himself for his outlays. We do not find this authorization significant except as an acknowledgment that the lands were a mere liability so far as she was concerned. Despite frequent divergencies as to other details, all of the appellants were unanimous in subscribing to the popular appraisement of the plantation as a "white elephant." The implication that if and when the place should emerge from the doldrums of debt, her one-eighth interest would be restored to her untrammeled ownership, is likewise made incidental by her conveyance to Mrs. Crawford in 1937 in consideration of an acquittance of the grantor of further responsibility.
The chancellor was justified in finding no bad faith upon the part of Mrs. Crawford who is shown to have repeatedly offered the property to appellants or to any one who would assume its outstanding obligations. Her zeal to disencumber herself of the over-burdened lands is measured by her offer, made repeatedly to appellants and others, to pay a bonus of $3,000 to any one who would assume the role and responsibility of a grantee. This offer was finally accepted by Arnold who sold out his holdings in Kentucky, moved upon the place, and has assumed and met its obligations.
Arnold bought the lands January 24, 1938. In April of that year, he wrote Mrs. Jones concerning the Federal Land Bank stock which is an adjunct of its loan contracts. With his letter he enclosed a copy of Mrs. Jones' instrument dated February 25, 1927, authorizing Dr. Crawford to utilize the entire income to pay expenses. We do not find in this act an enforceable obligation to reconvey to Mrs. Jones a one-eighth interest or to hold same in trust. This too, in spite of his assertion in his letter that "I can assure you that it will be carried out." If this is an agreement, which we do not decide, it was several months after he had been conveyed the land by Mrs. Crawford, and was, moreover, without consideration.
The case furnishes materials for plausible contentions by both sides of the controversy, and we are unable to justify overturning the decree of the chancellor. Nor are we vexed by any reservations that the decree must be upheld despite probable injustice, for adjudged as of the date of the several conveyances each transaction represented a consummation then devoutly wished by those who now have found reason to question anew their erstwhile judgment.
Affirmed.
It is earnestly urged on the suggestion of error that the guardian's sale of the three-eighths interest of the minors in 1927 was for a grossly inadequate consideration and, therefore, was not in good faith so as to fall within the protection of Section 745, Code 1942, and it is said that the evidence to that effect is undisputed. They say that it is undisputed that the guardian's sale was made in view of an offer made by a woman in Florida of $2,000 and some lots in Florida plus the assumption of the mortgage. It is not shown that this was worth anything as a binding offer, or that it was anything more than a prospect — a prospect which did immediately dissolve into thin air, and which if of any weight on the question of value was of little weight.
On the other hand, Mr. Gage, the executive vice-president of the Port Gibson Bank, whose testimony shows him to have had a close knowledge of financial and market conditions in that immediate territory throughout the years covering all these transactions, and whose successful management of that bank during the distressing periods involved demonstrates his trustworthiness on such questions, testified that Pecan Grove Plantation was not worth in 1927 any more than the $10,000 mortgage then resting upon it. The guardian had, in substance, so stated in her sworn petition for the sale. And the fact that the minors' said interest was sold at public auction and no bid was made above the amount for which the sale was made, is to be taken into consideration; wherefore the chancellor had such evidence before him as renders it beyond our reach to say that he was manifestly wrong in his decree, and this in spite of the fact that there was testimony to the contrary.
Moreover, the case on its full facts justifies the application against appellants of the doctrine of equitable estoppel, for the reason that although appellee Arnold moved upon the property in 1941 and thereupon and since has made large expenditures amounting to more than $15,000 in improvements and betterments out of his own funds and beyond funds obtained from the property itself, and although appellants were in 1941 of full age, and knew or had information of facts equivalent to knowledge that Arnold was acting in what he did as owner, under an unbroken chain of apparent title, they stood silently by throughout more than three years, and until 1945 when, for the first time, they asserted their claim in pais by their present bill of complaint. See Kelso v. Robinson, 172 Miss. 828, 829, 161 So. 135, and the long line of cases cited therein.
Suggestion of error overruled.