Child v. C. H. Winans Co., 50.

• Citation: 183 A. 300
• Decision Date: 31 January 1936
• Docket Number: No. 50.,50.
• Parties: CHILD v. C. H. WINANS CO.
• Court: United States State Supreme Court (New Jersey)

183 A. 300

CHILD

v. C. H. WINANS CO.

No. 50.

Court of Errors and Appeals of New Jersey.

Jan. 31, 1936.

Appeal from Court of Chancery.

Bill by Mary B. Child against the C. H. Winans Company. Decree for complainant, and defendant appeals.

Affirmed.

The following is the opinion of Vice Chancellor Buchanan:

In and prior to July, 1930, complainant owned a tract of land of about 78 acres in Linden, N. J. On July 22, 1930, she conveyed a portion (about eight acres) of that tract to Prall W. Lambert. The portion of the said eight acres is hereafter referred to as the Lambert tract, and the remaining 70 acres as the Child tract.

Prior to that time, Lambert had leased the eight-acre tract from Mrs. Child, and spent a large amount of money in erecting a factory thereon, and hence desired to get a conveyance of the eight acres. In the negotiations between Lambert and Mrs. Child, she was willing to sell and convey him the eight acres, but insisted as a part of the transaction that he should also lease the remaining 70 acres, the Child tract, and should pay the taxes and assessments due and to become due on the Child tract, and it was only upon Lambert's agreeing so to do that she consented to convey to him the Lambert tract.

Accordingly, in consummation of this agreement, Mrs. Child executed to Lambert on that day a deed of conveyance for the "Lambert tract for the recited consideration of $1.00 and other valuable consideration," which deed contains an express provision that "This conveyance is also made subject to the agreement that the said Prall W. Lambert, his heirs, executors, administrators, or assigns shall and will pay all municipal taxes and/or assessments due or to become due to the city of Linden aforesaid upon the whole tract of which the premises herein conveyed are a part, consisting of a parcel of land containing seventy-three acres more or less * * * said payments, so to be made by Prall W. Lambert, his heirs, executors, administrators, or assigns, for and during the natural life of said Mary Baldwin Child, and at her death, for and during the natural life of Ruth Child, daughter of Mary Baldwin Child, or until the said balance of the said premises shall be sold or otherwise disposed of by either or both the said Mary Baldwin Child and/or Ruth Child, at which time the payment of said tax by said Prall W. Lambert, his heirs, executors, administrators, or assigns shall cease, and he or they shall be relieved from the further payment thereof, or should a certain lease for the balance of the whole of said parcel between the parties hereof of even date herewith be terminated before the expiration of its term according to the conditions therein, then he or they shall be relieved from the further payment thereof." This deed was duly recorded.

On the same day and as a part of the same transaction, Mrs. Child, and her daughter Ruth, made a written lease to Lambert, executed by all three of them, leasing the Child tract to him for and during the term of the natural life of the lessors, Lambert agreeing to pay as rent therefor all taxes and assessments assessed or that may be assessed against said property during the lifetime of the lessors. The lessors had the right to cancel the lease at any time on sixty days' written notice. It contained quite a number of other minor provisions, and also a provision that the lease "shall be binding upon the heirs, executors, administrators, or assigns of the respective parties hereto." This lease was acknowledged by the parties, but was not recorded.

By deed dated August 8, 1930, Lambert and his wife conveyed the Lambert tract to his corporation, P. W. Lambert & Co., Inc. This deed recites the deed from Mrs. Child to Lambert above mentioned, and also contains this provision: "This conveyance is also made subject to a certain agreement made between Prall W. Lambert and the said Mary Baldwin Child as recited in the deed last above referred to for the payment of the taxes upon the remaining acreage of the whole parcel of which the premises herein conveyed were formerly a part, which said agreement the party of the second part hereby assumes according to the terms hereof." This deed was also duly and promptly recorded.

On the same day, August 8, 1930, the P. W. Lambert & Co., Inc., executed a mortgage of $50,000 to C. H. Winans Company. This mortgage recited the lastmentioned deed, and contained an express provision that "In addition to the payment of the taxes upon the premises herein described as hereinafter provided, that the payment of the tax upon the adjoining parcel in accordance with an agreement made with Mary B. Child in a deed from her to Prall W. Lambert, shall be a condition of this mortgage; and that if there should be default in the payment of such taxes, the mortgagee should have the right to demand immediate payment of the full principal of the mortgage, or should have the option of paying the tax and add the amount to the principal of the mortgage."

Two years later, the P. W. Lambert & Co., Inc., gave to the C. H. Winans Company a second mortgage of $30,000 upon the same Lambert tract, containing similar recitals and similar provisions.

In December, 1932, P. W. Lambert & Co., Inc., was adjudicated insolvent, and a receiver was appointed for it. September 13, 1933, the receiver sold the said Lambert tract at public sale, free and...