Graeme v. Cullen

• Decision Date: 02 April 1873
• Citation: 64 Va. 266
• Court: Virginia Supreme Court
• Parties: GRÆ ME v. CULLEN & als. HUNTER v. JOHNSTON & als.

64 Va. 266

GRÆ ME v. CULLEN & als.

HUNTER v. JOHNSTON & als.

Supreme Court of Appeals of Virginia.

April 2, 1873

1. Deed of trust to two trustees to secure debts, empowers the two, or either of them, to sell upon the demand of the creditor. If one of the trustees refuses to unite in the sale, the other may make a valid sale.

2. The house on the lot in a city conveyed in trust is burned down and the grantor in the deed employs workmen to build another house, upon an agreement to give them a lien upon the lot and house for the cost of the building. The workmen are not informed of the first lien, until they have nearly completed the work, though it was duly recorded. The whole property is subject to satisfy the first lien.

3. The act, ch. 135, s. 30-34, " concerning the action of ejectment," and the act, ch. 136, concerning the allowance for improvements," do not apply to this case. They are confined to cases of ejectment, or cases in which a decree or judgment is rendered against any defendant for land.

4. Though the builders have obtained a second deed of trust on the property, and claim that only the value of the lot without the house should be applied to satisfy the first lien, this is not such a cloud on the title as forbade the trustee to sell under the first deed; especially as the grantor in the deeds had obtained an injunction to a sale of the property on that ground; which had been dissolved before the advertisement of the second sale.

5. The trustee should sell according to the provisions of the deed.

6. In what cases, and upon what principles, a party making permanent improvements upon land, which belongs to another will be allowed compensation therefor; see the opinion of Moncure, P.

7. A vendor of a house and lot transfers to the vendee an insurance policy upon the house, and takes a deed of trust upon the house and lot to secure the purchase money. The house is afterwards consumed by fire. The debt not being paid, the vendor is not bound to pursue the insurance company, but may enforce payment by sale of the house and lot.

8. Upon a sale of a house and lot, upon credits extending through several years, separate bonds are taken for the interest. They will bear interest from the time they fell due.

By deed bearing date the 15th of February 1860, John Græ me, of the city of Richmond, conveyed to Gustavus A. Myers and John Græ me, jr., a certain lot of land in the city of Richmond, situated on the south side of Main street, on which there was a brick house, and bounded by the same boundaries as when Patrick Cullen purchased the same from James Talley on the 23d of January 1835; in trust to secure to Patrick Cullen the payment of the sum of $22,200, for which the said Græ me had that day executed and delivered to the said Patrick Cullen thirty writings obligatory commonly called single bills, by which he promised to pay to said Cullen, the several sums of money, and at the times, respectfully set forth and specified in a schedule annexed to the deed. These single bills were for various amounts and their times of payment ran from 1860 to 1875.

The deed provides that in the event that default be made in the payment of either of the above mentioned writings obligatory as they become due and payable, then the trustees, or either of them, on being required so to do by the said Patrick Cullen, his executors, administrators or assigns, shall sell the property hereby conveyed. And it is covenanted and agreed between the parties aforesaid, that in case of a sale, the same shall be made after first advertising the time, place and terms thereof, for ten days in some newspaper published in the city of Richmond, and upon the following terms, to wit: For cash as to so much of the proceeds, as may be necessary to defray the expenses of executing this trust, the fees for and recording this deed, if then unpaid, and to discharge the amount of money and interest then payable upon the said writings obligatory; and if at the time of such sale any writing shall not have become due and payable, and the purchase money be sufficient, such part or parts of said purchase money as will be sufficient to pay off and discharge such remaining writings obligatory shall be made payable at such time or times as the said writings obligatory will become due; the same to be properly secured; and for any residue, of purchase money on such credit as Græ me his executors, & c., should direct, or on his failure to direct as the trustees should think fit.

This deed was not executed by the trustees. It was recorded in the clerk's office of the Hustings court of the city of Richmond on the acknowledgment of Græ me, on the 21st of February 1860.

The house and lot conveyed in this deed, had been sold by Cullen to Græ me, and the writings obligatory mentioned, were for the purchase money. About the time of the conveyance by Cullen to Græ me, Cullen assigned to him a policy of insurance on the house.

The writings obligatory were paid by Græ me as they fell due, up to the year 1864. Those that fell due that year and subsequently were not paid; and on the 3d of April 1865 the house was burned in the fire which consumed a great part of the city.

In July 1865 John Græ me being the owner of the ground extending from the lot conveyed as aforesaid, to Twelfth street, and running back on that street, made a contract with S. H. and J. F. Adams, of Baltimore, for the building of three tenements on his ground on Main street, and two to front on Twelth street; and the agreement seems to have been that the contract should be reduced to writing and placed on record, so as to give them a lien on the lot and buildings for the price of building them. This, however, was not done until November, for the reason as S. H. Adams states, that they were advised by their counsel, that the clerk's office was in the possession of the United States Military authorities, and therefore it could not be recorded. In November they had been informed of the deed of trust held by Cullen, and then John Græ me and James Hunter and Mary his wife, who was the daughter of Græ me, entered into an agreement in writing, which was admitted to record, by which Græ me covenanted that the Adams' should have a lien on the ground and the buildings they were putting up for Græ me; and Hunter covenanted that they should have a lien on certain real estate of his own, for the cost of building the said houses; and by deed bearing date the 15th of March 1866, and duly admitted to record on the 17th Græ me conveyed to Andrew Johnston and John Græ me, jr., the ground and buildings aforesaid, and Hunter and wife conveyed to them the real estate mentioned in his agreement, in trust, to secure to S. H. Adams for himself and his partner J. F. Adams, the payment of seven negotiable notes bearing date the 15th of March 1866, with interest from the date, executed by Græ me to S. H. Adams, payable in from one to six years, amounting together to $58,660. The first of these notes, which was payable in one year, was for $9,450, and the second, which was payable in eighteen months was for $5,525.

The trusts of the deed were to sell if and when any of the said notes were not paid; and for cash for expenses of executing the trust, and to discharge all principal and interest then due, and upon a credit for such sums and at such times as required to meet the other notes not then due, if any, and the surplus if any was to be paid as Græ me should direct. And it was provided that as soon as the first two notes were fully paid Hunter should be entitled to have and receive a release of the property which he conveyed by the deed. By another deed bearing date the 14th of March 1867, executed by Græ me, Hunter and wife, the trustees and S. H. Adams, reciting the sale by Græ me to Robert A. Mayo, of a part of the property conveyed by him, in consideration of the trustees and Adams uniting in a conveyance of the same to Mayo, Turner and wife released the provision in his favor for a release of his property on the payment of the first two notes.

By the direction of Cullen the trustees, Myers and John Græ me, jr., advertised the property embraced in the deed from John Græ me to them to be sold on the 7th of March 1868 on the terms of the deed. The advertisement set out the several writings obligatory secured by the deed, then stated the several bonds then due, and also the bonds which were yet undue, with the amount of each and the time it fell due. The amount due and for which cash was required was between seven and eight thousand dollars, the amount to fall due and for which a credit was to be allowed, was $8,680, and extended from August 1868 to February 1875.

To enjoin this sale John Græ me filed his bill in the Circuit court of the city of Richmond. The grounds on which the injunction to the sale was asked, was that the building which was on the lot when Cullen sold it to Græ me had been burned, and the new building put upon it by the Adams' and built under an agreement that gave them a lien upon it; and that Cullen with a knowledge that they were putting up the building, had not given them any notice of his lien. The plaintiff insisted, therefore, that Cullen was entitled to a lien to the value of the ground, and that the Adams' were entitled to the balance of the price at which it should be sold; and that the property should not be sold until this question was settled.

The injunction was refused by the judge of the Circuit court, but was granted by a judge of the court of Appeals. This injunction was dissolved on the 11th of April 1868. And then Cullen directed the trustees to proceed to sell the property under his deed of trust; and John Græ me, jr declining to unite in the sale, it was advertised by ...