McLennan v. Prentice

• Decision Date: 21 June 1893
• Citation: 55 N.W. 764,85 Wis. 427
• Parties: MCLENNAN v. PRENTICE.
• Court: Wisconsin Supreme Court

85 Wis. 427

55 N.W. 764

MCLENNAN

v.PRENTICE.

Supreme Court of Wisconsin.

June 21, 1893.

Appeal from circuit court, Ashland county; E. G. Bundy, Judge.

Action by James M. McLennan against Frederick Prentice to recover damages for breach of covenants of a deed to certain real estate. From a judgment for plaintiff, defendant appeals. Reversed.

The other facts fully appear in the following statement by PINNEY, J.:

This case was before this court on an appeal by plaintiff from a judgment rendered against him on the merits, (77 Wis. 124, 45 N. W. Rep. 943,) which was reversed, with directions to the circuit court, in its discretion, to grant a new trial, upon cause shown, of all the issues, instead of rendering judgment for the plaintiff for the amount of his claim to which he was entitled upon the facts, as they then appeared. Subsequently the circuit court granted a new trial pursuant to the right so reserved to it. The case is stated in 77 Wis. 124, 45 N. W. Rep. 943. It appeared upon the new trial that neither of the parties to the conveyance, upon the covenants of which the action is founded, had ever been in the actual possession of the premises described therein. This court had held that the action was one on the covenant of seisin, and that the burden of proof was on the defendant, the grantor, to show that he was seised of an estate in fee at the time of the execution of the deed, and in the absence of such proof the grantee therein was entitled to recover the purchase price, and interest from the date of the deed. The conveyance included all of lots 1, 2, 3, 4, 5, and 6, in block 23, constituting the entire block, (sold for $6,000,) and lots 20 and 21, in block 37, (sold for $2,500,) in Ellis' addition to Ashland, for the entire consideration of $8,500, and was dated April 2, 1887. In July of that year the plaintiff became satisfied that there were no lots in block 37, and became very much afraid that block 23 was not as the defendant represented it to be, and desired him to settle the matter up in respect to lots 20 and 21, in block 37. He had then found out that lots 2 and 3, in block 23, belonged to the railroad company, and about the title to the lots in block 23, except as to 1 and 6. At this time the plaintiff quitclaimed to the defendant lots 20 and 21, in block 37, for $2,500; and the purchase-money mortgage given at the time of the original purchase for $5,000 of the price, of $8,500, was discharged, and the plaintiff gave the defendant a new mortgage for $2,500, being the balance thereof, $3,500 having been paid down at the time of the purchase. The defendant then told the plaintiff he could not fix it up in regard to block 23 at that time; that he wanted to ascertain his rights more fully; and the plaintiff says he told him he “was perfectly willing to take block 23, under these circumstances, if he would make it right with me in regard to the balance of the purchase money;” that he “would do what was right about block 23 when he could find out more about it.” The plaintiff testified that he supposed that the title to the block was perfect when he purchased it, except as regards the title to two of the lots in the Wisconsin Central Railroad Company, which the defendant promised to obtain from the railroad company--lots 2 and 3--for him. The defendant had no title to lots 2 and 3, in block 23, at any time, except as riparian owner of lot 1; and on the 11th of May, 1888, the plaintiff tendered a quitclaim deed to the defendant of the entire block, and brought this action to recover the contract price. All of the lots in block 23 lie side by side under the shallow water between the shore of Ashland bay and navigable water, except lot 1, a considerable part of which was high land on the bank. The complaint charged that fraudulent representations were made by the defendant at the time of the purchase--First, in respect to the quantity of hard land in lot 1; and, second, that the defendant had a good title to the entire block. But in view of the former decision, and the finding and facts already stated, this branch of the case, it is understood, is eliminated from the present controversy. The court found, as matter of fact, that lots 4 and 5, in block 23, were both owned by the defendant, and that lots 1 and 6 had been formerly owned by him, and, in substance, that the title thereto was then held in trust for him; that after the conveyance by the defendant to the plaintiff, which was by warranty deed, he procured them to be conveyed to one Maddocks, and by said Maddocks to the defendant, who now owns the same; that as to lots 2 and 3 the defendant has not, and never had, title thereto. The evidence shows that the deed from Maddocks to the defendant for lots 1 and 6 was made December 13, 1887; that the plaintiff claimed that there was a total want of title to lots 1, 2, 3, and 6. It was also found that in 1883 the Wisconsin Central Railroad Company commenced building a track of its road in the street south of lot 1, and completed it the next year, erecting an embankment which extended on lot 1, and covered substantially all of the hard land thereon,--the embankment running to the water's edge, and on a portion of the lot extending into the water; that the embankment is permanent, and the railroad company thus appropriated all of the hard land on block 23, and continue to use it for the purposes of their track, and embankment supporting it, but had never acquired title to the land, nor instituted proceedings to condemn it; that the plaintiff purchased block 23 because it was deemed valuable for the riparian rights appurtenant thereto, and as a suitable place to carry on business connected with the navigation of the lake, and that the block is of little value for any other use or purpose; that in order to carry on such business it would be necessary to have free access to and from the shore, and from the northerly limits of such block, out to the navigable waters of the lake, and ownership of lots 2 and 3 in other parties would render it of no value for such purposes. The court found, as a conclusion of law, that the plaintiff was entitled to judgment for the sum of $6,000, and interest from the date of such sale, April 2, 1887.Tomkins & Merrill, for appellant.

T. L. Kennan, for respondent.

PINNEY, J., (after stating the facts.)

1. It was found that when the defendant executed the conveyance to the plaintiff in question he owned water lots 4 and 5, in block 23; and it was proved that he afterwards, on December 13, 1887, acquired title to lot 1, part of which was on the bank, and hard land, and the rest under shoal water of the bay, and also apparent title to lot 6, lying out beyond lots 4 and 5, and extending to or towards navigable water. This was many months before the plaintiff attempted to rescind the sale. The evidence shows that he was satisfied with block 23 at the time the arrangement of July, 1887, was made, whereby the mortgage on block 23 to the defendant was canceled, and another mortgage executed thereon for $2,500, after applying the proceeds of lots 20 and 21, above mentioned. He then had full knowledge, or the means of knowledge, as to the true state of the title to each lot in the block, and he knew that he had obtained no title to lots 2 and 3, but supposed he had good title to lots 4 and 5; and it was understood that he was to obtain good title to lots 1 and 6, and also to lots 2 and 3. He was then content to await the efforts of the defendant to complete the title. When the plaintiff tendered to the defendant, on the 11th day of May, 1888, a reconveyance of block 23, and commenced this action, he had acquired record title to all the block, except lots 2 and 3. The covenant of seisin in the deed from the defendant to the plaintiff was partially or wholly broken, if at all, when made; and if the deed did not pass any title to the plaintiff, or to the extent that it failed to pass title to the premises described in it, and if the grantee did not obtain possession, the covenant of seisin would thereby be turned, wholly or partially, as the case might be, into a right of action, and he might at once sue on the covenant of seisin, and recover the entire purchase money, with interest, or a proper portion thereof, if the failure to convey title was only partial. If the grantee had entered or been put in possession of the premises included in the deed, the breach of this covenant would be technical, and would entitle the grantee, in case he sued on it, to nominal damages merely; but he could not in such case recover substantial damages until he had been evicted, or in some way deprived of the whole or a part of the premises, or suffered substantial loss. Proof of eviction is not necessary to entitle the grantee to recover on this covenant, and has no bearing in an action on it, except on the question of damages. But where the deed contains a covenant of warranty, by which the grantee has obtained seisin of a title subsequently acquired by his grantor, it would be inequitable that he should have the seisin, and be allowed to recover back the consideration paid for it. Accordingly, when the defendant acquired the title to lots 1 and 6, December 13, 1887, his seisin at once inured and passed to the plaintiff, in virtue of the covenant of warranty in his deed. Baxter v. Bradbury, 20 Me. 260;Somes v. Skinner, 3 Pick. 52; Knowles v. Kennedy, 82 Pa. St. 445; Knight v. Thayer, 125 Mass. 25;King v. Gilson, 32 Ill. 348. If the plaintiff acquired, before the commencement of the action, by virtue of his deed, the seisin which it was the object of both the covenants of seisin and of warranty to secure to him, he would be entitled only to nominal damages. In King v. Gilson, supra, it was held sufficient to restrict the grantee to nominal damages if he acquired, by inurement, the legal title, at any time before the assessment of damages in the action on the covenant of seisin. Baxter...