Newton v. Newton

• Decision Date: 07 April 1891
• Citation: 46 Minn. 33,48 N.W. 450
• Parties: NEWTON v NEWTON ET AL.
• Court: Minnesota Supreme Court

46 Minn. 33

48 N.W. 450

NEWTONvNEWTON ET AL.

Supreme Court of Minnesota.

April 7, 1891.

(Syllabus by the Court.)

1. A party to a contract may obligate himself for a valuable consideration to make his will in a particular way, or to give certain specific property to a particular person, so as to bind his estate.

2. It is alleged and found that the note in controversy here was made to the payee, E. N., in her life-time, among other things, in consideration that at the death of the latter it should become the property of plaintiff, and that the payee would by her will give and bequeath the same to her. E. N. died intestate, and B. N. holds the legal title thereof. Held, that upon the death of E. N. plaintiff became equitably entitled to the note, and that she might enforce her claim of title thereto, and her right to collect the proceeds thereof, as against the holder, unless he was a bona fide purchaser without notice, by an action in equity to have him declared trustee for her, and to restrain him from collecting and appropriating the proceeds thereof.

3. Where parties voluntarily proceed to trial on the merits in an equity suit it is too late to raise the objection that the plaintiff had an adequate legal remedy.

4. The title of a bona fide purchaser of a chose in action without notice of the prior equity of a third party against his vendor will prevail over such equity, but a purchaser with notice thereof acquires the title of such vendor only.

5. And the burden rests upon such vendee, if he would avail himself of the rule in favor of bona fide purchasers, to bring himself within it. He is bound to deny notice of the prior equity in order to raise the issue. The equity rule is equally applicable under the Code system of pleading.

Appeal from district court, Olmsted county; START, Judge.

Burt W. Eaton and Davis, Kellogg & Severance, for appellants.

Chas. C. Willson, for respondent.

VANDERBURGH, J.

The controversy in this case is over plaintiff's right and title to a chose in action,-an indebtedness of $4,000, due from the defendants Geisinger and Salina E. Newton, evidenced by a promissory note by them executed to one Emily A. Newton, now deceased, and dated on the 1st day of June, 1883. The makers were the executor and executrix of the last will of Angelo Newton, late of Olmsted county, who died in 1881; and the payee, who was his mother, residing in the city of New York, was a creditor and one of his legatees. The defendant Buno Newton, a son of Emily A. Newton, also claims to own the note, and to have acquired the same of her shortly before her death in 1888. It is claimed by the plaintiff and found by the court that in January, 1883, there was due Emily Newton from the estate of Angelo Newton upwards of $8,000; that the property of the deceased, consisting chiefly of unsalable real estate, could not be sold and converted into money without great sacrifice; and that, as the result of negotiations conducted between the parties, terms of settlement were agreed on, in pursuance of which the note in question was executed. They are concisely stated by the court in its findings as follows: “Thereupon such negotiations by letter were had by and between the said Emily A. Newton on the one side and the said Samuel Geisinger and Salina E. Newton on the other that it was mutually agreed between them that in payment of her said claim the said Geisinger and Salina E. Newton should raise and pay to her $4,000 by June 1, 1883, and execute and deliver to her their two personal promissory notes,-one for $600, due in six months from said date, with interest at the rate of seven per cent. per annum, and one for $4,000, due in five years thereafter, with interest, payable semi-annually, at the rate of seven per cent. per annum; and in consideration thereof the said Emily A. Newton agreed that the interest on the said $4,000 note should be collected by her during her life for her own use, but the principal thereof should remain uncollected by her, (the said note to be renewed if necessary,) and should be paid upon her death to her said grandchild, Bessie Newton, the plaintiff herein; and that, in aid of said agreement, she would bequeath to said Bessie said $4,000 note, and that said Bessie should have said note upon the death of the said Emily A. Newton, who was to receive only the semi-annual interest on said note during her life. That the defendants Geisinger and Salina E. Newton performed all the conditions of said contract on their part. They raised said $4,000 in cash from their own means, and by a pledge of their individual credit paid the same to said Emily A. Newton, and executed and delivered to her their personal notes pursuant to said contract, and during her life paid her the semi-annual interest on said $4,000 note, and the interest on said $600 note to June 1, 1888. Said notes are the same notes described in the pleadings in this action.” The agreement is thus found to have been fully performed on the part of Geisinger and Salina Newton; and it thus appears that the promise and agreement on the part of Emily Newton to make this specific provision for the plaintiff, her granddaughter, to take effect at her death, was founded upon a valuable and adequate consideration. Assuming the finding to be supported by the evidence, the contract is a valid one, and may be enforced. Such a disposition of property is as much the subject of an executory contract as any other. In other words, a party may obligate himself to make his will in a particular way, or to give certain specific property to a particular person, so as to bind his estate. But the courts will be strict in looking into the nature and circumstances of such agreements, and require satisfactory evidence of the fairness and justness of the transaction. Rivers v. Rivers, 3 Desaus. Eq. 195;Izard v. Middleton, 1 Desaus. Eq. 116;Johnson v. Hubbel, 10 N. J. Eq. 335, 66 Amer. Dec. 784, note, and cases. In this case, however, the transaction seems entirely reasonable. It was upon a fair consideration; and there was sufficient inducement for such provision for her grandchild in the settlement that was made out of the indebtedness of her father's estate to her. That such agreements are valid, and that their execution may be enforced, the counsel for the appellant do not question.

1. There is sufficient evidence to sustain the finding of the court in respect to the nature and terms of the contract. The testimony of defendants Geisinger and Salina Newton directly tend to establish it; and, whatever criticism upon its credibility may be suggested, it was not successfully or conclusively impeached, and we find no ground for opening the question of the credibility of these witnesses, which was fully considered and passed upon by the trial court. The testimony of both these witnesses is quoted in the brief of defendants' counsel, to show that it tended to prove that Mrs. Newton agreed to make a testamentary disposition of the note to the plaintiff, and nothing more;...