Groff v. State Bank of Minneapolis
| Decision Date | 22 June 1892 |
| Citation | 52 N.W. 651,50 Minn. 234 |
| Parties | Thomas W. Groff v. State Bank of Minneapolis |
| Court | Minnesota Supreme Court |
May 23 1892, Argued
Appeal by the defendant, the State Bank of Minneapolis, from a judgment of the District Court of Hennepin County, Hooker J., entered November 5, 1891.
Benjamin B. Groff and Hugh A. Gilson jointly owned a lot fronting south upon Nineteenth street in Minneapolis. It was fifty feet front by two hundred feet deep. On May 4, 1887, they conveyed this lot to William H. Groff. On June 18, 1887, he deeded back the east half to Gilson, and on September 10 1889, he deeded the west half to Thomas W. Groff, the son of Benjamin B. Groff. He did this on the father's request. The father was, by his tenants, in the actual occupancy of the west half of the lot from June 18, 1887, to September 10 1889, and the son was, thereafter.
The bank recovered a judgment against Wm. H. Groff for $ 804.42, which was docketed May 10, 1888. It claimed this judgment to be a lien on the west half of the lot, because the title stood of record in the judgment debtor's name. Thomas W. Groff, the son, filed this bill to remove the cloud, claiming that the judgment debtor never had any beneficial interest in the property; that the deed to him was made to enable him to convey to the owners in severalty the half each had theretofore owned in common, and that the possession of Benjamin B. Groff was notice of his rights. The District Court so held, and the bank appealed.
Fletcher, Rockwood & Dawson, for appellant.
If it be true that Benjamin B. Groff had a right to have the west half of the property reconveyed to himself, he had an equitable interest in it. The whole title as between him and Wm. H. Groff was not in Wm. H. Groff, and in order to convey the whole title to the plaintiff, it was necessary that Benjamin B. Groff should make a deed of his interest to plaintiff. There was no other way in which his interest could be conveyed to plaintiff. This was never done. Plaintiff stands then, with reference to the bank's judgment, just where Wm. H. Groff stood. He has no greater interest in the property than Wm. H. Groff had. Benjamin B. Groff still has his equitable interest. The conveyance of the property to Wm. H. Groff was for the purpose of creating an express trust mentioned in 1878 G. S. ch. 43, §§ 14, 20. It. therefore took effect according to the provisions of section 20.
It was the English rule that possession by a party, either by his tenants or himself, was notice of any right which he might have in the premises. In England, in the absence of registration laws, that rule was a necessity. It has not been adopted in the United States. The registration laws have provided a better means of notifying all the world of the rights of a party in any property. The necessity for the English rule does not here exist. But if it does, an exception is made in the case of a grantor holding possession after he has made conveyance of the land. So many and such eminent courts have adopted this exception that it is now the general rule in the United States. 16 Am. & Eng. Encyc. of Law, 803; Newhall v. Pierce, 5 Pick. 450; Cook v. Travis, 20 N.Y. 400; Abbott v. Gregory, 39 Mich. 68; May v. Sturdivant, 75 Iowa 116; Tuttle v. Churchman, 74 Ind. 311; Groton Savings Bank v. Batty, 30 N.J.Eq. 126; Patten v. Moore, 32 N.H. 382.
Benjamin B. Groff in August, 1887, caused Wm. H. Groff to mortgage the lot to secure the notes of Wm. H. Groff. This was notice to all the world that Wm. H. Groff, and not himself, was the owner of this property.
By his delay in securing a conveyance of the property, he allowed Wm. H. Groff to appear upon the record as the owner of it. He held out to the public and to the creditors of Wm. H. Groff, that this property belonged to Wm. H. Groff, and they had a right to rely upon it. The cases in this state are, Morrison v. March, 4 Minn. 422, (Gil. 325;) Roberts v. Grace, 16 Minn. 126, (Gil. 115;) Palmer v. Bates, 22 Minn. 532; Wilkins v. Bevier, 43 Minn. 213; New v. Wheaton, 24 Minn. 406.
S. A. Reed, for respondent.
The Supreme Court of Minnesota has fully settled the question of trust, and it is only necessary to refer the court to the case of Randall v. Constans, 33 Minn. 329.
One who purchases real estate in the actual occupation of a third person, is chargeable with notice of the interest of such person, and should communicate with him, and ascertain the particulars of his claim. Freeman, Judgments, § 357; Morrison v. March, 4 Minn. 422, (Gil. 325;) Groff v. Ramsey, 19 Minn. 44, (Gil. 24;) Wilkins v. Bevier, 43 Minn. 213; 2 Devlin, Deeds, §§ 762, 763, 764.
A person holding the title to land under a parol trust which has been executed by that person before sale upon execution against him, has no interest on which the lien of the judgment can attach. Blankenship v. Douglas, 26 Tex. 225; Siemon v. Schurck, 29 N.Y. 598; Norton v. Mallory, 63 N.Y. 434.
A judgment creditor having acquired knowledge outside the records, of the condition of the title and the claims of third persons, cannot prevail against such claims. Lamberton v. Merchants' Nat. Bk., Winona, 24 Minn. 281; Wolf v. Zabel, 44 Minn. 90.
This court has passed on this same question, as well as California, Illinois, and Wisconsin. New v. Wheaton, 24 Minn. 406; Pell v. McElroy, 36 Cal. 268; Illinois Cent. R. Co. v. McCullough, 59 Ill. 166; Brinkman v. Jones, 44 Wis. 498.
The undisputed facts in this case are that Benjamin B. Groff and Hugh A. Gilson, being the owners as tenants in common of certain real estate, on May 4, 1887, without consideration conveyed it to one William H. Groff for the sole purpose of effecting a partition of the premises between them by having William H. Groff convey one half in severalty to each. This conveyance was recorded July 13, 1887. In pursuance and execution of this arrangement, William H. Groff conveyed one half in severalty to Gilson, but made no conveyance at that time of the other half (the premises in dispute) to Benjamin B. Groff; but the latter immediately (June 18, 1887) went into the actual, open, and exclusive possession and occupancy of it, and so continued until it was conveyed to the plaintiff, as hereinafter stated. While Benjamin B. Groff was thus in the actual possession and occupancy of the premises, but the title of record in William H. Groff, the defendant, on May 10, 1888, obtained and docketed a judgment against William H. Groff. On ...
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