Ross v. Midelburg
| Decision Date | 01 April 1947 |
| Docket Number | CC 715 |
| Citation | 129 W.Va. 851 |
| Court | West Virginia Supreme Court |
| Parties | J. Shirley Ross v. Charles A. Midelburg, et al. |
A party to an oral contract for the sale of land, to which the statute of frauds is applicable, may, by conduct on his part, be estopped in equity to assert the statute of frauds as a defense to such contract.
An oral contract for the sale of land, as to which a party to it is estopped to assert in equity the defense of the statute of frauds, but which is in all other respects sufficient, is a binding and enforceable contract.
A conveyance of real estate, in form an absolute deed by the grantor to the grantee, and a separate written agreement between them, which is dated nine days after the date of the conveyance, which recites the making of such deed and the holding of the title thereunder by the grantee, and which gives an option to the grantor to repurchase the property from the grantee by a specified date but not thereafter, may, notwithstanding the language of the conveyance and of the agreement to the contrary, be shown by parol evidence to be parts of the same transaction under a prior oral agreement between the parties and to constitute, instead of a deed absolute and a conditional sales agreement, a mortgage given as security for the payment of indebtedness owing by the grantor to the grantee. In such case parol evidence is permitted, not to vary or contradict the terms of the written instruments, but to establish a constructive fraud vitiating them or to establish a superior equity of a mortgage between the parties.
Certified from Circuit Court, Kanawha County.
Suit by J. Shirley Ross against Charles A. Midelburg and another to obtain settlement of account between plaintiff and the defendants and to compel the defendants to convey to plaintiff certain unsold parcels of real estate now held by them. The circuit court sustained defendants' demurrer to the amended bill of complaint and, on its own motion, certified its ruling upon the demurrer to Supreme Court of Appeals.
Ruling reversed; case remanded.
Watts, Poffenbarger & Bowles, Edward S. Bock, Jr., and Charles E. Mottesheard, for plaintiff.
Silverstein & Angel and L. H. Barringer, for defendants.
The plaintiff, J. Shirley Ross, instituted this suit in the Circuit Court of Kanawha County to obtain settlement of an account between him and the defendants, Charles A. Midelburg and Katharyn Wilson Midelburg, his wife, and to compel the defendants to convey to him certain unsold parcels of real estate now held by them.
The circuit court, a special judge acting in lieu of the regular judge, sustained the demurrer of the defendants to the amended bill of complaint and on its own motion certified its ruling upon the demurrer to this Court.
Charles A. Midelburg is the principal defendant and when his complete name is not used he is referred to in this opinion as the defendant, the defendant Midelburg, or Midelburg.
The following facts appear from the allegations of the amended bill of complaint, which, on demurrer and for the purpose of considering the ruling of the circuit court, should be regarded as true.
Prior to July 23, 1938, and on that day, the plaintiff was the owner in fee simple of ten parcels of valuable real estate in Kanawha County, West Virginia. He was in debt and a decree of sale of eight parcels of his land had been entered and special commissioners appointed in a pending lien creditors' suit which had been instituted for the purpose of subjecting his real estate to the payment of his debts. The value of the real estate decreed to be sold exceeded by a substantial margin the amount of the indebtedness of the plaintiff.
The defendant, Charles A. Midelburg, offered to assist the plaintiff in his financial difficulties. Conferences between them were had prior to and after May 7, 1938. As a result the plaintiff and the defendant, Charles A. Midelburg, entered into an oral agreement whereby Midelburg agreed to attend the sale, bid on the properties to be sold, and, if possible, purchase them and save to the plaintiff his equities in them. The agreement provided that if Midelburg should purchase the properties at the sale, he should be repaid the amount paid by him for the properties and the expense incurred by him, with interest; that Midelburg was to have the right to rent, sell, manage and control the properties he should acquire at the sale, if he or the plaintiff should find tenants or purchasers for them; that the rents and the purchase money from sales received by Midelburg were to be applied as credit upon the money paid and expended by him; and that if any of the property remained in his hands after he had been fully repaid he was to convey to the plaintiff the unsold parcels and to pay to the plaintiff the residue of such funds. The agreement also provided that if any other bidder should offer more than the amount which the plaintiff regarded each of the properties to be worth, Midelburg should permit such property to be sold to such bidder.
The eight parcels of real estate decreed to be sold were designated as parcels Nos. 1, 2, 3, 4, 5, 6, 7 and 10. The amounts at which the plaintiff was willing that these properties should be sold to a bidder other than Midelburg were listed in a written memorandum delivered to Midelburg before the sale. These figures were, for parcel No. 1, $8,000.00 cash; for parcel No. 2, $12,000.00, one-third cash; for parcel No. 3, $3,000.00, one-third cash; for parcel No. 4, $6,000.00 cash; for parcel No. 5, $10,000.00 cash; for parcel No. 6, the assumption of a deed of trust debt and $10,000.00; for parcel No. 7, $100.00; and for parcel No. 10, $100.00, or a total of $47,200.00. These amounts the plaintiff considered low, but he was willing that the properties be sold at the listed prices, which would be sufficient to satisfy the lien indebtedness owed by him on the properties and the costs and leave an excess sufficient to enable him to discharge a lien debt which existed against other real estate owned by him, known as the Splash Beach property. If the sale were made on the basis stated above, the plaintiff would save the Splash Beach property free of the lien and be able to retain as his own several thousand dollars from the sale of the eight parcels.
The sale was made by the special commissioners on July 23, 1938. Twenty or twenty-five bidders and Midelburg attended the sale, at which Midelburg purchased parcel No. 1 for $5,100.00, parcels Nos. 2 and 3 for $12,500.00, parcels Nos. 4 and 5 for $14,450.00, parcel No. 6 for $3,700.00, parcel No. 7 for $10.00, and parcel No. 10 for $10.00, or a total of $35,820.00. Parcels Nos. 2 and 3 and parcels Nos. 4 and 5 were sold for one-third cash and the residue of the purchase price was payable in one and two years, with interest, to be secured by vendors' liens, and parcel No. 6 was sold subject to an existing deed of trust lien. The other parcels were sold for cash. Deeds for these properties were made by the special commissioners on July 28, 1938, to the defendant, Charles A. Midelburg.
Later, on August 16, 1938, the plaintiff assigned to the defendant, Charles A. Midelburg, by writing addressed to the special commissioners, any funds remaining in their hands after the payment of the debts, the liens and the costs in the creditors' suit, and authorized them to deliver a check for such funds to Midelburg. By virtue of that assignment the special commissioners paid to Midelburg on November 27, 1939, the sum of $3,724.30.
By deed dated July 23, 1938, signed and acknowledged August 8, 1938, the plaintiff conveyed to the defendant, Charles A. Midelburg, parcels Nos. 8 and 9 of his real estate, known as the Splash Beach property, as further security to Midelburg for the repayment to him of the amounts paid and to be paid by him in his efforts to save to the plaintiff his equities in the properties sold in the creditors' suit.
After the sale the plaintiff, pursuant to the understanding between him and Midelburg, assisted Midelburg in carrying out the oral agreement and in enabling Midelburg to rent and sell the properties which he had purchased at the judicial sale.
By reason of his purchase and his use and operation of the properties, the defendant, Midelburg, paid and expended a total of $48,177.94. The properties were worth, at the time of sale, an amount largely in excess of the total amount of $47,200.00, for which the plaintiff was willing for them to be sold to a purchaser or purchasers other than Midelburg.
Several days after the sale, Midelburg presented to the plaintiff for execution a writing dated August 1, 1938, which recited, among other things, the purchase by Midelburg of the eight parcels of real estate, the making of the deed, dated July 23, 1938, by the plaintiff to Midelburg for parcels Nos. 8 and 9, known as the Splash Beach property, owned by the plaintiff, and which had not been sold at the judicial sale, and the holding of the legal title by Midelburg to all the property formerly owned by the plaintiff, by virtue of the deeds from the special commissioners and the deed from the plaintiff for parcels Nos. 8 and 9, known as the Splash Beach property. The writing then stated that it was agreed between the plaintiff and the defendant, Charles A. Midelburg, that the plaintiff should have the exclusive right and option to purchase all of the property from Midelburg, on stated terms, at any time prior to, but not after, October 31, 1938. It further provided that the transaction between the parties was not, and was not intended to be, a loan, but an act upon the part of Midelburg to give the plaintiff an opportunity" to endeavor to raise funds with which to regain the properties which had been lost to him at the judicial sale. It stated that the plaintiff, at the time, had no right or interest in the property, other than the right...
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