Buford v. Dahlke

• Decision Date: 22 January 1954
• Docket Number: No. 33414,33414
• Citation: 62 N.W.2d 252,158 Neb. 39
• Parties: BUFORD v. DAHLKE et al.
• Court: Nebraska Supreme Court

Page 252

62 N.W.2d 252

158 Neb. 39

BUFORD v. DAHLKE et al.

No. 33414.

Supreme Court of Nebraska.

Jan. 22, 1954.

Syllabus by the Court.

1. An appeal from a judgment of dismissal of the case after a general demurrer to the petition has been sustained presents for decision the sufficiency of the facts well pleaded to state a cause of action.

2. An executory contract for the sale and purchase of real estate, enforceable for and against vendor and vendee, is a present equitable conversion of real estate into personalty and of personalty into real estate.

3. The creation as well as the continued existence of an estate in joint tenancy under the common law, which is allowed to exist in this jurisdiction, requires a unity of possession, a unity of interest, a unity of time, and a unity of title in all holding an interest in such estate.

4. Any act of a joint tenant which destroys one or more of its necessarily co-existent unities operates as a severance of the joint tenancy and extinguishes the right of survivorship.

5. A contract to sell real estate owned by a husband and wife as joint tenants made by both the tenants destroys the joint tenancy in the real estate and effects an equitable conversion of it into personalty consisting of the contract for sale in which the husband and wife each own an undivided one-half interest though they retain legal title to the real estate as security for a part of the purchase price.

6. If a contract for the sale of real estate is silent as to the relationship of the vendors as owners of the contract they own it as tenants in common.

7. A joint tenancy may be created only by contract and the purpose to do so must be clearly expressed otherwise the tenancy is presumed to be in common.

Charles E. O'Brien, Robert H. Petersen, Omaha, for appellant.

Oscar T. Doerr, Omaha, for appellees.

Heard before SIMMONS, C. J., and CARTER, MESSMORE, YEAGER, CHAPPELL, WENKE, and BOSLAUGH, JJ.

BOSLAUGH, Justice.

This appeal developed because of a general demurrer by appellees to the petition of appellant, the action of the court sustaining the demurrer, the refusal of the appellant to plead further in the case, and a judgment of dismissal.

The appellant alleged in his petition that: He was the appointed and qualified administrator of the estate of Ernest R. Dahlke. Prior to September 1, 1949, Ernest R. Dahlke and Laura H. Dahlke, his wife, were the owners in joint tenancy of a described tract of real estate in Douglas County Nebraska, and on that date they contracted in writing to sell it to George N. Chadwell and J. Louise Chadwell for $4,750, payable to Ernest R. Dahlke and Laura H. Dahlke at the times fixed by the contract. A copy of the contract was attached and made a part of the pleading. The vendees had paid to Laura H. Dahlke, since the death of her husband on January 13, 1951, $192 because of the contract. The unsatisfied part of the purchase price was $2,929.50. One-half of the money paid or to be paid because of the contract after the death of Ernest R. Dahlke was an asset of his estate. The wife of the deceased had refused to account to appellant for one-half of the amount paid to her by the vendees on the contract after the death of the deceased, and the vendees have refused to account to appellant for one-half of the amount due by the terms of the contract. The vendees maintain that they should, and they have declared that they will, pay all further amounts required by the contract to Laura H. Dahlke, the surviving wife of the deceased, and will not pay to appellant one-half thereof as he has requested and demanded. The appellant asked for a judgment against appellees for one-half of the amount paid by the vendees to Laura H. Dahlke since the death of her husband, for a declaratory judgment that one-half of all amounts to be paid by virtue of the contract constitute an asset of the estate of the deceased and should be paid to appellant, and for other equitable relief.

The vendors are named in the contract as 'Ernest R. Dahlke and Laura H. Dahlke, husband and wife, parties of the first part' and the purchase price is required to be paid to them. They are not referred to therein in any other capacity or status. The vendees are described in the contract as 'George N. Chadwell and J. Louise Chadwell, as joint tenants with right of survivorship, parties of the second part' and they were given possession of the premises from the date the contract became effective.

The appeal presents for decision the sufficiency of the facts well pleaded by the petition to state a cause of action in favor of the appellant. Panebianco v. City of Omaha, 151 Neb. 463, 37 N.W.2d 731; Koehn v. Union Fire Ins. Co., 152 Neb. 254, 40 N.W.2d 874.

The real estate described in the petition and in the contract of sale and purchase referred to therein was owned in joint tenancy by Ernest R. Dahlke and Laura H. Dahlke. They, on September 1, 1949, obligated themselves in writing to sell and convey it for a stated consideration to George N. Chadwell and J. Louise Chadwell, as joint tenants with right of survivorship, and they agreed to buy it and pay the purchase price partly in cash and the balance in installments. The contract was properly executed and delivered. Its validity and enforceability has not been questioned and obviously could not be because appellant pleads it as the basis of the relief he seeks and appellees admit all facts concerning the contract asserted by the pleading of appellant. The specific problem is who was entitled to the unpaid part of the purchase price of the property at the time of the death of Ernest R. Dahlke on January 13, 1951. The appellant claims one-half of it as an asset of the estate of the deceased. The appellee, Laura H. Dahlke, says she is the owner of all of it by right of survivorship.

It is important to consider who was the owner of the real estate at the time of the death of Ernest R. Dahlke. That is clearly outside the range of argument. It has been frequently and consistently decided by this court, as it is quite unanimously agreed by courts generally that if the owner of real estate enters into a contract of sale whereby the purchaser agrees to buy and the owner agrees to sell it and the vendor retains the legal title until the purchase money or some part of it is paid, the ownership of the real estate as such passes to and vests in the purchaser, and that from the date of the contract the vendor holds the legal title as security for a debt as trustee for the purchaser. The interest or estate acquired by the vendee is land and the rights conferred by the contract upon and vested in the vendor are personal property. In case of the death of the vendee intestate his interest or estate in the land would descend to his heirs and in the case of the death of the vendor intestate the rights acquired by him because of the contract would pass as personal property to his administrator. In Hendrix v. Barker, 49 Neb. 369, 68 N.W. 531, this court said: 'In an executory contract for the sale of real estate, equity treats the vendor as the trustee of the purchaser, and the purchaser as the trustee of the purchase money for the vendor. This rule rests upon the doctrine that equity considers that done which ought to be done.' The statement of the rule in Jewett v. Black, 60 Neb. 173, 82 N.W. 375, is: 'An executory contract for the sale of land vests the equitable ownership of the property in the purchaser, and in such case the seller retains the legal title as security for the deferred installments of the purchase price.' It is said in Grandjean v. Beyl, 78 Neb. 349, 110 N.W. 1108: 'A vendee in possession of land under a contract of purchase, on which part of the purchase price has been paid, holds equitable title to the land which, on his death, descends to his heirs.' In re Estate of Wiley, 150 Neb. 898, 36 N.W.2d 483, 485, contains this language: 'An executory contract for the sale and purchase of land, enforceable for and against vendor and vendee, is a present equitable conversion of land into personalty and of personalty into land. * * * Where an owner of realty entered into a binding contract for the sale thereof prior to his death equity will treat the realty as personalty in distributing his estate.' See, also, Dorsey v. Hall, 7 Neb. 460; Gardels v. Kloke, 36 Neb. 493, 54 N.W. 834; First Nat. Bank of Falls City v. Edgar, 65 Neb. 340, 91 N.W. 404; United States v. Sode, D.C., 93 F.Supp. 398; 19 Am.Jur., Equitable Conversion, § 15, p. 15. This court has not deviated from this doctrine and has applied and enforced it when the contract of purchase and sale was 'enforceable for and against vendor and vendee'. Grandjean v. Beyl, supra; In re Estate of Wiley, supra.

A matter of prime importance was the effect of the contract of sale and purchase upon the status of the vendors as joint tenants. An indispensable requisite of a common-law joint tenancy was the four unities of time, title, interest, and possession. The tenants thereof were required to have one and the same interest resulting from the same conveyance, commencing at the same time, and accompanied by undivided possession. These were required to be continued during the jointure. Any act which destroyed one or more of the unities caused a severance and destruction of the joint tenancy. In Stuehm v. Mikulski, 139 Neb. 374, 297 N.W. 595, 596, 137 A.L.R. 327, it was said: 'The creation as well as the continued existence of an estate in joint tenancy under the common law, which is allowed to exist in this jurisdiction, requires a unity of possession, a unity of interest, a unity of time and a unity of title in all holding an interest in such estate.' See, also, Anson v. Murphy, 149 Neb. 716, 32 N.W.2d 271.

Any act of a joint tenant which destroys one or more of its necessarily co-existent unities operates as a severance of the joint tenancy and extinguishes the right of survivorship. Stuehm v. Mikulski, sup...