Pickens v. Daugherty

• Decision Date: 06 December 1965
• Citation: 21 McCanless 349,217 Tenn. 349,397 S.W.2d 815
• Parties: , 217 Tenn. 349 C. O. PICKENS et al., Petitioners, v. J. E. DAUGHERTY et ux., Respondents.
• Court: Tennessee Supreme Court

Page 815

397 S.W.2d 815

21 McCanless 349, 217 Tenn. 349

C. O. PICKENS et al., Petitioners, v. J. E. DAUGHERTY et ux., Respondents.

Supreme Court of Tennessee.

Dec. 6, 1965.

Rehearing Denied Jan. 10, 1966.

Thomas E. Mitchell, Johnson City, for petitioners.

Curtin, Haynes & Winston, Bristol, for respondents.

CHATTIN, Justice.

On January 18, 1884, Nathan Gregg conveyed a tract of land containing one-half acre to Sullivan County for school purposes. The applicable provisions of the deed are as follows:

'The conditions of the above gift is that the said E. R. King, N. Hughes and J. F. King, School Directors as aforesaid, and their successors in office are to erect on the said parcel of land a good and suitable house for the purpose of having taught therein a public free school to the use and benefit of said public free school, the same is to be at all times used but if at any time the same shall cease to be used for said public free school purpose then the title to said piece or parcel of land is to revert back to the said Gregg, his heirs and assigns in as full and ample a manner as if this instrument had never been given.'

The one-half acre tract was carved out of a tract of 149 acres owned by Gregg. On July 14, 1903, the Executor under the will of Nathan Gregg conveyed the entire 149 acres, including the school lot to Graves, et al. This deed makes no reference to the lot previously granted for school purposes. By other mesne conveyances, likewise containing no reference to the school lot, Daugherty and wife became the owners of the property. They were in possession of 148.5 acres under their deed when Sullivan County, in 1962, by resolution of its County Court, abandoned the property as a school site.

Petitioners, C. O. Pickens, and others, as the heirs at law of Nathan Gregg, filed the bill in this case in which they alleged the respondents, J. E. Daugherty, et ux., had procured the keys to the school building and were claiming the property by virtue of their deed. They further alleged petitioners were the rightful owners of the school lot because the lot reverted to them as the heirs of Nathan Gregg under the provisions of the deed above quoted. The prayer of the bill was that they be declared the owners of the lot and a mandatory injunction issue requiring the respondents to surrender possession of the lot to petitioners.

The respondents answered and admitted they were claiming the school lot by virtue of their deed, the calls of which embraced the one-half acre in controversy.

They averred in their answer that the common law rule which formerly prevailed in Tennessee to the effect a reversionary interest in the nature of a possibility of reverter was not assignable has now been changed by T.C.A. Section 64-501, which provides:

'Every grant or devise of real estate, or any interest therein, shall pass all the estate or interest of the grantor or devisor, unless the intent to pass a less estate or interest shall appear by express terms, or be necessarily implied in the terms of the instrument.'

They further averred that in the event the deed of Gregg's Executor did not convey his 'right of entry for breach of condition' or 'possibility of reverter,' nevertheless the attempted conveyance by that deed extinguished the right of his heirs to re-enter after a breach of the condition and therefore the heirs of Gregg had no right to maintain the suit.

The Chancellor correctly held the possibility of reversion contained in the Gregg deed to the School Directors was not an alienable right. Board of Education of Humphreys County v. Baker, 124 Tenn. 39, 134 S.W. 863 (1910); Yarbrough v. Yarbrough, 151 Tenn. 221, 269 S.W. 36 (1924); Atkins v. Gillespie, 156 Tenn. 137, 299 S.W. 776 (1927); Newman v. Ashe, 68 Tenn. 380 (1876).

He held, however, the school lot reverted to petitioners as the heirs of Nathan Gregg, in 1962, when Sullivan County, by resolution of its County Court, abandoned the property as a school site.

Respondents appealed to the Court of Appeals. That Court found the Chancellor had pretermitted the question raised by respondents' answer that the attempt of Gregg's Executor to convey the possibility of reverter contained in the deed to the School Directors extinguished the right of Gregg's heirs to re-enter upon the abandonment of the property by Sullivan County for school purposes with the result petitioners are without a right to maintain the suit.

The Court of Appeals correctly found the deed of Nathan Gregg to the School Directors created an estate upon a condition subsequent.

The Court of Appeals then found the question of the extinguishment of the right of re-entry after condition broken by the attempted conveyance of Gregg's Executor was improperly pretermitted by the Chancellor. That Court further found petitioners lost the right to re-enter and claim the land after Sullivan County abandoned the property for school purposes because of the attempted conveyance by Gregg's Executor to Graves et al. That Court held the action of Gregg's Executor extinguished the right of re-entry altogather. Accordingly, the Court of Appeals held petitioners had no title to the school lot entitling them to maintain their suit and dismissed the suit on that ground.

We have granted certiorari. Both parties have assigned errors.

Petitioners assign as error the action of the Court of Appeals in finding the attempted conveyance of the right of re-entry extinguished the right altogether.

The Court of Appeals in reaching the conclusion the attempted conveyance of the school lot by Gregg's Executor extinguished the right of re-entry altogether relied upon the authority of Board of Education of Humphreys County v. Baker, supra. It was held in that case an attempted conveyance of a right of re-entry upon a breach of conditions subsequent extinguished the right altogether and in such event the property remained in the grantee; and that such attempted conveyance was a cloud upon the title of the grantee.

In 33 Am.Jur., Life Estates, Remainders, etc., Section 210, page 693, it is said, except where abrogated by statute this common law rule of extinguishment by waiver resulting from an attempt to convey a right of re-entry for condition broken has persisted despite attacks upon it.

However, it is difficult for us to understand the logic of this rule. How can it be said the right of re-entry upon condition broken is inalienable but an attempt to convey it destroys the right altogether? How can it be said that which does not pass does not remain?

This same rule was approved in Restatement of the Law, Property, Future Estates, Section 160, Comment (C) (1936). But the position of the 1936 restatement was reversed in 1948. See Restatement of the Law, Property, Section 160, Comment (C), (Supp.1948), wherein it is said:

'An attempt to transfer a power of termination, which under the rule in this section is ineffective to make such transfer, does not destroy the power of termination. The ineffective attempt to part with the interest is no sufficient basis for forfeiting the interest and thereby relieving the land from all further obligation under the condition subsequent. No sound historical or practical basis exists for the opposite.'

It is further stated in Restatement the doctrine of extinguishment is undesirable and questionable in its foundations. In fact, Restatement affirms that no English decision supporting the rule of extinguishment 'has ever been found,' and that 'no rational or adequate historical basis for the rule has ever been suggested.'

'This seems to be an unduly harsh penalty for an attempted alienation which did no harm because it was ineffective to pass the interest.' American Law of Property, Volume I, Section 4.69, page 529.

We agree the rule is unsound and illogical and for that reason we think the case of Board of Education of Humphreys County v. Baker, supra, should be overruled insofar as it approves the doctrine of extinguishment and we so hold.

In other words, it is our opinion the attempted conveyance of Gregg's Executor was ineffective to destroy or extinguish the right of re-entry on condition broken altogether; and the right of re-entry upon condition broken remained in Gregg's heirs despite the conveyance.

The rule at common law is a right of re-entry upon condition broken is inalienable.

In Board of Education of Humphreys County v. Baker, supra, the rule was stated to be:

'It is not every right in real estate that is the subject of grant. A bare possibility of an interest, which is uncertain, is not grantable. It must be an interest in the land existing in possession, reversion, or remainder, or by executory devise, or contingent remainder.'

This State is a common law state and unless our statute, T.C.A. 64-501, as insisted by respondents, abrogates the common law rule, it still persists in this State.

The purpose of T.C.A. Section 64-101 and T.C.A. Section 64-501 was to abolish the common law rule requiring words of inheritance as an indispensable prerequisite to the creation of an absolute estate in fee simple. And since the...