Ex parte Robinson

• Decision Date: 08 April 1943
• Docket Number: 3 Div. 380.
• Citation: 244 Ala. 313,13 So.2d 402
• Parties: Ex parte ROBINSON.
• Court: Alabama Supreme Court

13 So.2d 402

244 Ala. 313

Ex parte ROBINSON.

3 Div. 380.

Supreme Court of Alabama

April 8, 1943

Rehearing Denied May 13, 1943.

Petition for mandamus.

Sollie F. Commander, of Montgomery, for petitioner.

Walter J. Knabe, of Montgomery, for respondent.

FOSTER, Justice.

The chief question here depends upon whether the defendant in an ejectment suit has an equitable question, the decision of which should dispose of the cause, and which cannot be disposed of on the law side of the court.

The question arises on a retransfer of the cause to the law side ordered in the decree which sustained demurrers to the bill filed by defendant in ejectment, after it had been removed to equity. It is here on an original mandamus to require the judge to vacate the order sustaining the demurrer and retransfer it. Title 13, section 155, Code of 1940.

This procedure is not questioned, and is approved by our cases. Jones v. Wright, 220 Ala. 406, 125 So. 645; Altman v. Barrett, 234 Ala. 234, 174 So. 293.

The facts which are relied on to sustain petitioner's equitable claim will be stated with only such detail as is necessary to illustrate the question presented.

Assuming the ownership of a tract of six acres of land by Ruth J Lambert on June 10, 1931, she on that day entered into a lease sale contract of the land to Knechtel, containing the following provision: "It is understood and agreed between the parties hereto that the property herein described will be subdivided, at the expense of the party of the second part; into approximately fifty-seven (57) lots of substantially the same size and value. It is further agreed that the party of the first part will release from the operation of this agreement and deed to the party of the second part or such person as the party of the second part may designate, any lots or lot upon payment to the party of the first part of the sum of seventy-five ($75.00) dollars in cash for each lot so released and deeded. Any payment made under the provisions of this paragraph shall be credited on the outstanding note on said series of notes, last maturing interest on payments so made to abate from date of payment."

The bill alleges that on November 15, 1931, Knechtel entered into a written agreement with petitioner, binding both to the sale and purchase of lot twenty according to a certain survey of the aforesaid six acres, for the sum of $150 to "be paid in ten days after the complainant received the money which was due to him from the U.S. Government." The bill alleges that petitioner was at once put into possession of the said lot No. 20, supra, by Knechtel, and he immediately made improvements on it to the value of $1,200, including a dwelling house which he occupied. That he has since November 15, 1931, continuously occupied and held the lot "by adverse, actual, open, visible, exclusive, hostile, peaceable and undisturbed possession."

On July 28, 1932, Knechtel executed a quitclaim deed back to Lambert. At that time petitioner was in possession of lot No. 20 supra, but had paid no part of the purchase money. The deed by Knechtel to Lambert is not attached as an exhibit, and we are not advised of any special circumstances which were the occasion of its execution. It is not alleged that Knechtel had failed to pay any of the installments of the purchase price, or to comply with any of the terms of the agreement with Lambert which justified a forfeiture of his right as a purchaser, and thereby to become a tenant of Lambert; or that she had made such a claim.

It does not appear that Lambert asserted any right in lot 20, supra, then in possession of petitioner, of which he had notice, or ever called on him for its possession.

But after said quitclaim by Knechtel to Lambert, and on October 26, 1932, Knechtel and petitioner entered into another contract in writing carrying out and supplementing the original contract between them, in which receipt of seventy-five dollars is acknowledged with an agreement to pay the balance in annual installments.

On August 9, 1932, Lambert executed a warranty deed to Simpson conveying certain parts of this tract including lot 20, supra. And plaintiff in the ejectment suit claims under Simpson.

When Lambert acquired the quitclaim deed on July 28, 1932, and at the time of her conveyance to Simpson, and of the execution of the other deeds under which plaintiffs in the ejectment claim title, the actual, visible possession of lot No. 20 is alleged to have been in petitioner. So that whatever rights any of them acquired by such conveyances were with constructive notice of petitioner's claim. First National Bank v. Haynes, 236 Ala. 133, 181 So. 495.

Since the bill does not allege that at the time the contract with petitioner was made by Knechtel November 15, 1931, Knechtel had made default or that Lambert had the right to declare a forfeiture by him, or had undertaken to do so, petitioner thereby became entitled to the benefits of a subpurchaser under the clause of the contract which we have quoted. That contract does not fix a time when the seventy-five dollars shall be paid to Lambert, except that it should be construed to be at or before the execution of a deed to him by her.

So that if on July 28, 1932, when she received the deed from Knechtel there had been no default or forfeiture declared, that deed would undoubtedly be subject to the rights which petitioner acquired by his contract with Knechtel on November 15, 1931, as would also the deeds of her subpurchasers, the present claimants of the lot. First National Bank v. Haynes, 236 Ala. 133, 181 So. 495.

The bill should probably be so construed for present purposes, which is only now reviewed on its general equity, there being only a general demurrer sustained by the trial court. But it is open to attack on a special ground of demurrer for the failure to allege that there was no forfeiture declared on a default of Knechtel which had then occurred. We think it not inappropriate to consider its sufficiency in that respect when tested by a special ground of demurrer as it doubtless will be on a further trial.

That brings us to the question of whether petitioner acquired rights by his contract which bound Lambert even though Knechtel may have made default which justified a forfeiture insofar as he was concerned, or whether a court of equity will set aside such forfeiture.

The rule is thus stated in 66 Corpus Juris 1080, section 872: "A subpurchaser creates between the original vendor and subpurchaser a privity of estate, but does not, in the absence of agreement, create a privity of contract. When the vendor is notified of the sale by the purchaser he holds the legal title subject to the equitable estate acquired by the subpurchaser." And, on page 1081, section 875: "Where a vendor who has contracted to sell land for the purpose of resale receives part of the proceeds paid by a subpurchaser in possession under a subcontract, equity will render a decree that will do equity to all parties." And in section 876: "On the same principle that an ordinary contract of sale converts the owner of land into a trustee for the purchaser, a subsale converts the (first) purchaser into a trustee for the subpurchaser." This relation between an original seller and his purchaser is well known, when both parties are bound by the contract. Love v. Butler, 129 Ala. 531, 30 So. 735; Wimbish v. Montgomery B. & L. Ass'n, 69 Ala. 575; Bay Minette Land Co. v. Stapleton, 224 Ala. 175, 139 So. 342(10); Loventhal v. Home Ins. Co., 112 Ala. 108, 20 So. 419, 33 L.R.A. 258, 57 Am.St.Rep. 17.

Time is not generally of the essence of a contract for the sale of real estate. Forrester v. Granberry, 211 Ala. 402, 100 So. 551; Isom v. Johnson, 205 Ala. 157, 87 So. 543.

Unless petitioner lost his equity in the land by reason of some forfeiture in the contract between Lambert and Knechtel, it can be enforced on the showing made by the bill against those who with notice acquired the land from Lambert now asserting title against petitioner. First National Bank v. Haynes, supra.

But assuming that there had been a forfeiture. The jurisdiction of a court of equity to relieve against forfeitures is well known. It "is founded upon the principle that a party having legal rights shall not be permitted to use them oppressively to the injustice of the defaulting party." Hunter-Benn & Co. Company v. Bassett Lumber Co., 224 Ala 215, 139 So. 348, 349. "The hard and harsh remedy of forfeiture yields to compensation when...