Cassell v. Lowry

• Court: Indiana Supreme Court
• Writing for the Court: Hadley, J.
• Citation: Cassell v. Lowry, 164 Ind. 1, 72 N.E. 640 (Ind. 1904)
• Decision Date: 16 December 1904
• Docket Number: 20,419
• Parties: Cassell v. Lowry

72 N.E. 640

164 Ind. 1

Cassell v. Lowry

No. 20,419

Supreme Court of Indiana

December 16, 1904

From Benton Circuit Court; Joseph M. Rabb, Judge.

Action by Abram Lowry against Horace G. Cassell. From a decree for plaintiff on his complaint and against defendant on his cross-complaint, defendant appeals. Transferred from Appellate Court under § 1337u Burns 1901, Acts 1901, p 590.

Reversed in part, affirmed in part.

Charles M. Snyder, for appellant.

Burton B. Berry, for appellee.

OPINION

Hadley, J.

Lowry the appellee, brought this action to quiet his title to two lots in the town of Boswell, alleging that he was the owner in fee, and that the defendant claimed an adverse interest therein, which claim was unfounded and a cloud upon the plaintiff's title. Cassell, the appellant, in addition to the general denial, in substance answered that on October 5 1889, he conveyed by warranty deed to the plaintiff the identical real estate described in the complaint; that at the time of the conveyance the plaintiff paid all the purchase price except $ 100, for which he executed to the defendant his promissory note for $ 100, due six months after date; that no security of any kind was taken or received, but he (defendant) reserved his vendor's lien against the property, and which constitutes the cloud upon the plaintiff's title of which he complains; that said debt is due and wholly unpaid; that the plaintiff's wife was a sister of the defendant, and she, on December 26, 1896, paid the defendant $ 20 on said indebtedness, which he duly credited; that on account of said kinship, and believing and relying upon the payment of said $ 20 as having been made with the knowledge and consent of the plaintiff, and accepting said payment as indicating the plaintiff's purpose to pay the defendant as soon as he conveniently could, and believing he intended to do so, the defendant forbore to sue for said purchase money. Prayer that the plaintiff take nothing, etc. The court sustained a demurrer to the answer, and no exception was reserved. The defendant, however, pleaded the same facts, in various forms, with some elaboration, in four paragraphs of cross-complaint. In all these paragraphs he alleged the insolvency of the plaintiff, and prayed for a declaration of his vendor's lien and for an order of sale. The plaintiff's separate demurrer to each paragraph of the cross-complaint was overruled. The plaintiff then answered the cross-complaint generally in three paragraphs: (1) The general denial; (2) that said note was due and payable 180 days from its date; that no part of said note has ever been paid, and suit was not brought upon it against the cross-defendant within ten years after the cause of action accrued; (3) a verified answer of non est factum. Appellant's demurrer to the second paragraph of answer to the cross-complaint was overruled, and he properly excepted. Appellant then replied to said second paragraph, as an excuse for the delay in instituting suit upon the note, the same matter that he set up for a like purpose in his answer to the complaint. A demurrer was sustained to the reply, and appellant excepted. Trial by the court. Finding and judgment for the plaintiff quieting his title as prayed.

Appellant has assigned for error the overruling of his demurrer to the second paragraph of answer to the cross-complaint, the sustaining of the demurrer to his affirmative reply to the cross-complaint, and the overruling of his motion for a new trial.

The only important question presented by this appeal is whether a purchaser of real estate is entitled to invoke a statute of limitation to quiet his title against his vendor's lien for unpaid purchase money, when he asserts in his pleading that the consideration he agreed to pay for the estate remains unpaid? In other words, will a court of equity employ a limitation statute to aid a vendee in removing from his title a cloud cast upon it by his confessed failure to pay for the property as he had agreed to do?

A vendor's lien is an ancient rule, and had its origin in the principle of natural justice and equity, which impresses the conscience that it is not fair for a vendee of lands, who gives no other security, to have, as between the parties, the absolute estate until he has fully paid for it. It rests upon the same foundation as the doctrine of subrogation and contribution among sureties. Arbogast v. Hays (1884), 98 Ind. 26. A vendor's lien is not, then, founded on contract, but arises by implication of law. Warford v. Hankins (1898), 150 Ind. 489, 50 N.E. 468. It is created by the law solely to secure the payment of purchase money. It is therefore an incident of the debt, and, while it can not survive the debt, it continues to exist until the debt is paid or otherwise discharged. Lilly v. Dunn (1884), 96 Ind. 220, 225.

Under our system of procedure, we have but one form of action, and a statute of limitation applies alike to actions at law and suits in equity. The statute is directed to the substance, and not to the forum, or the form of the action. A promissory note given for unpaid purchase money, under the fifth subdivision of § 294 Burns 1901, § 293 R. S. 1881, is valid evidence of the debt for ten years from maturity, after which time the statute may be interposed to an action upon the note, and likewise applied to a suit in equity on the coexistent vendor's lien to subject the land to the payment of the same debt. For it must be said that a statute that bars the debt, the principal thing, bars also the incident, the lien. It follows that the second paragraph of answer to the cross-complaint, setting up the ten-year statute generally as a bar to the cross-complaint, was sufficient, both as to the action on the note and for foreclosure of the lien, and the demurrer thereto was properly overruled.

But this does not dispose of the case. It is a familiar doctrine that the statute of limitations is a statute of repose, and not one...