Bradley v. Luce

• Decision Date: 14 May 1881
• Citation: 1881 WL 10541,99 Ill. 234
• Parties: MERRITT E. BRADLEY et al.v.BENJAMIN C. LUCE et al.
• Court: Illinois Supreme Court

99 Ill. 234

1881 WL 10541 (Ill.)

MERRITT E. BRADLEY et al.

v.BENJAMIN C. LUCE et al.

Supreme Court of Illinois.

Filed at Ottawa May 14, 1881.

OPINION TEXT STARTS HERE

WRIT OF ERROR to the Circuit Court of Lake county; the Hon. CHARLES KELLUM, Judge, presiding.

On the 12th day of April, 1870, Benjamin C. Luce, defendant in error, being the owner of a farm in Lake county, consisting of 544 acres, sold to William Darby 188 acres of the place for $8186, payable, $3000 January 1, 1872, $3000 April 22, 1873, and $2186 April 22, 1874. These notes were secured by a mortgage given by Darby on the land so purchased. The balance of the farm Luce occupied until the spring of 1872, when he leased his farm to one William Ruth, for the term of three years, and moved to the city of Chicago. In the fall of 1872 he fell in with Merritt E. Bradley, one of the plaintiffs in error, who was a real estate dealer in the city of Chicago, and to whom Luce went, as he says, to engage him to sell the farm in question. Bradley examined the farm and proposed to buy it, but wanted it for less than $60 per acre, the price at which it was held by Luce. After some negotiations a trade was agreed upon between Luce and Bradley, in which Luce sold Bradley the farm, the notes and mortgage on Darby, and a quantity of stock, farming implements and grain on the farm, all amounting to something over $30,000, for the property. Bradley agreed to convey Luce certain lots in Irving Park, being 900 to 1000 feet front, which were valued by Bradley at $30 per foot. Subsequently it turned out that Bradley had no title to the Irving Park property, or at least could not make Luce a title to the property, and another arrangement was entered into between the parties, under which Bradley agreed to give Luce for the property, cash, $3000; 170 shares of stock of the St. Louis and Wisconsin River Lumber Company, represented by Bradley to be worth $14,450; four notes executed by Charles Walters, three for $2000 each and one for $1630, with ten per cent interest thereon, amounting to $7630, secured by mortgage on one-half of 100 acres of land in the county of Allegan, Mich.; and two notes of $2500 each, executed by one George A. Allen, amounting then to $5000, secured by mortgage on the other half of said 100-acre tract of land. In addition to this, Bradley agreed to assume and pay a note of $3000, given by Luce to one James Wells, and secured by mortgage on the farm owned by Luce. Under this arrangement Luce and his wife, on the 14th day of November, 1872, executed and delivered to Bradley a deed for the farm, and also transferred to him the Darby notes and mortgage. Bradley turned over the Darby notes and mortgage to Benjamin L. Pease, and obtained from him a loan of $3000, which he paid over to Luce. On the 27th day of November, 1872, Bradley, with the consent of Pease, surrendered the Darby notes and mortgage to Darby, in consideration of which Darby and his wife conveyed to Bradley the 188 acres of land which Luce had formerly sold to Darby. On the day following, Bradley, through Benjamin L. Pease, obtained a loan of one Hiram Barker, of $6000, and to secure the payment of the principal and interest he executed a deed of trust on the land Luce had conveyed, as well as the land Darby had deeded to him. Bradley paid off the James Wells mortgage, which he had agreed to assume, with $3000 of this money.

At the time Luce delivered his deed for the farm to Bradley, the latter did not turn over the notes against Walters and Allen, secured by the mortgages on the Michigan lands. Bradley represented that the mortgages were then sent for record, and he would deliver the notes and mortgages, with an abstract of title, in a short time. In the meantime, however, he left with Luce 200 shares of St. Louis and Wisconsin River Lumber Company stock, in addition to the 170 shares that he had sold Luce, as collateral security to the Michigan notes and mortgages. The abstracts of title for the Michigan lands not having been furnished by Bradley, Luce became somewhat dissatisfied, and upon making inquiry he became satisfied that the lumber company stock was of little or no value, and that the parties who had executed the Michigan mortgages were insolvent, and the lands embraced in the mortgages were worth but a small amount, and that the representations made by Bradley in regard to the stock and mortgages were false.

Under these circumstances, on the 18th day of December, 1872, Luce filed a bill in equity, in the circuit court of Lake county, against Bradley, to set aside the deed he had made and cancel the contract, on the ground of fraud and imposition.

Prior to the filing of the bill, however, and on the 14th day of December, 1872, Bradley and his wife deeded the property to one Oliver S. Lincoln, and he conveyed to Mrs. Bradley, but these deeds were not recorded until June 1, 1874. Bradley having failed to pay the interest as it became due, on the trust deed given to Barker to secure the loan of $6000, Henry M. Wells, plaintiff in error, purchased the notes secured by the trust deed, and caused the trustee to advertise and sell the whole farm, and at the sale Wells became the purchaser for $5500, and received a deed for the premises.

Afterwards, and on the 22d day of June, 1874, Mrs. Bradley filed her bill against the trustee and Wells, to set aside the sale. Subsequently this case came on for a hearing before one of the judges of the circuit court of Cook county, and after hearing the evidence he decided that the sale had not been advertised in such a newspaper as the law requires, and that the sale had been fraudulently made, and directed that a decree be prepared to set aside the sale. No decree was, however, prepared or signed, but in a short time Mrs. Bradley and Wells had an interview, which resulted in an arrangement that the bill should be dismissed at plaintiff's costs, that Mrs. Bradley should deed the property to one Charles B. McCoy, and that he should deed 200 acres of the property to Wells, and that Wells should convey the balance to McCoy, which was accordingly done. Subsequently McCoy conveyed to Mrs. A. E. Kent, of California, who brought ejectment to recover possession of the property. In the meantime Luce filed an amended bill, his original bill not having been heard, and obtained an injunction, and on the hearing a decree was rendered in his favor, and the defendants therein prosecute this writ of error.

Messrs. TENNEY & FLOWER, for the plaintiffs in error:

A mortgagee, in equity, is regarded in the light of a purchaser. 2 Washb. on Real Prop. 90; Clark v. Hunt, 3 J. J. Marsh. 557; Wood v. Bank of Kentucky, 5 Mon. 194.

A purchaser in ignorance of any fraud, for a valuable consideration, will be protected. 1 Story's Eq. Jur. secs. 434 and 381; 3 Washb. on Real Prop. 299; Dennis v. McCagg et al. 32 Ill. 429; Gavagan v. Bryant, 83 Id. 380. Pease, being an innocent purchaser, had a right to sell to anybody he could trade with. Brandlyn v. Ord, 1 Atk. 571; Lowther v. Carlton, 2 Id. 242; Sweet v. Southcote, 2 Brown Ch. 55; Bumpus v. Platner, 1 Johns. Ch. 213; Moore et al. v. Hunter et al. 1 Gilm. 330; Peck v. Arehart, 95 Ill. 117; Boone v. Chiles, 10 Pet. 178; Trull v. Bigelow, 16 Mass. 418; Boynton v. Reeves, 8 Pick. 332; Hogthorp v. Hook, 1 Gill & J. 273.

The complainant is estopped from attacking the Pease title, now held by defendants. Waughop v. Week et al. 23 Ill. 350; Anderson v. Armstead, 69 Id. 452; Knœbel v. Kircher, 33 Id. 308; Kinnear v. Mackey, 85 Id. 96; Noble v. Chrisman, 88 Id. 198; Higgins v. Ferguson et al. 14 Id. 269.

The court erred in setting aside the deed from Henry M. Wells to Charles B. McCoy, securing the claim of McCoy & Pratt, they not being parties to the suit. Herrington v. Hubbard, 1 Scam. 569; Adams Eq. 472; Hopkins et al. v. Roseclare Lead Co. 72 Ill. 373; Atkins v. Billings, Id. 597.

The court erred in setting aside the sheriff's deed to Ellen A. Ball, conveying the premises. Stevens v. Hollingsworth et al. 74 Ill. 212; Leopold v. Krause, 95 Id. 440.

Mr. GEO. F. HOEFFER, for the defendants in error:

In setting up a bona fide purchase, the party must state the deed, the date, parties, and contents, briefly;--that the vendor was seized in fee and in possession, and the consideration must be stated, with a distinct averment that it was bona fide and truly paid, independent of the recital in the deed, and notice must be denied. Boone v. Chiles, 10 Pet. 178; Metropolitan Bank v. Godfrey, 23 Ill. 606.

Possession of premises is notice to a purchaser of the possessor's title, both legal and equitable. Daniels v. Davidson, 16 Ves. 524; Jackson v. Post, 9 Cow. 120; Tuttle v. Jackson, 6 Wend. 213.

Lis pendens is notice as to the property described in the proceedings. Green v. Slayter, 4 Johns. Ch. 38; Miller v. Sherry, 2 Wall. 237. And applies to purchasers from a party to the suit of the thing in controversy. Hopkins v. McLaren, 4 Cow. 678; Parks v. Jackson, 11 Wend. 442; Cole v. Lake Co. 54 N. H. 272; Jackson v. Warren, 32 Ill. 340; Adams' Eq. 157.

To constitute an equitable estoppel there must be a representation, or concealment, of material facts, and the representation must be made with a knowledge of the facts, and with the intention that the other party shall act upon it. The party to whom it is made must have been ignorant of the truth of the matter, and have been induced to act upon it, and there must have been a fraudulent purpose and a fraudulent result. Dozell v. Odell, 3 Hill, 219; Stevens v. Dennett, 51 N. H. 324; Martin v. Zellerbach, 38 Cal. 300; Baggs v. Merced Co. 14 Id. 367; Davidson v. Young, 38 Ill. 152; People v. Brown, 67 Id. 435; Ruard v. Gardner, 39 Id. 125; Bigelow on Estoppel, 437; 3 Washb. 80; Story's Eq. (Redfield's ed.) sec. 1543.

Silence as to that of which one has a right to presume the other party has notice, will not work an estoppel. Rice v. Dewey, 54 Barb. 455; Bales v. Perry, 51 Mo. 449; Shaw v. Spencer, ...