Sawyer v. Cook
| Decision Date | 18 May 1905 |
| Parties | SAWYER v. COOK et al. COOK et al. v. SAWYER. |
| Court | United States State Supreme Judicial Court of Massachusetts Supreme Court |
Wm. D. Turner, for Sawyer.
Percy G. Bolster for George M. and Mary A. Cook.
Under the deed by which title was acquired originally to the land referred to in these bills of complaint, Nathan Sawyer, since deceased, his son, Henry N. Sawyer, and George M. Cook parties to the present suits, became seised as tenants in common of a large tract of unimproved real estate. The purchase price was $65,000, and of this amount $38,000 was secured by a mortgage back to the grantor, while the remaining $27,000 was paid in money, advanced by father and son, with the exception that of this sum $5,000 was the avails of a promissory note, made by all the grantees, but has since been paid by the first two. Within a short time after their acquisition of title, at the request of the other grantees, Cook conveyed to them his interest. A week later all the parties mutually sealed, executed, acknowledged, and delivered the written agreement which is the foundation of each of these suits. Their legal relations and corresponding rights are to be determined under this deed with the accompanying agreements, as obviously they are parts of and form one transaction. It evidently was the common purpose to divide this tract into lots, put them upon the market, and by their joint efforts not only to realize from sales the original cost, but also to make a profit by the venture. For convenience in making conveyances, it is expressly stated that the fee is conveyed by Cook to them. They also are permitted to first repay themselves from the money received from sales for all advances made at the time of purchase, and, further, were authorized also to pay therefrom the outstanding mortgage and the unsecured note. By this arrangement a less cumbersome method in disposing of the lots, and at the same time providing security for payments of advancements and money borrowed, was perfected. After the full indebtedness had been paid, they all were to share in the money received from the remaining lots as sold, in the proportion, however, of one-fourth to Cook and three-fourths to the Sawyers. The complainant, Sawyer, who has acquired the title of his father, and is now seised in fee and in possession of the land remaining unsold, contends that this agreement is to be treated as a simple contract, and nothing more, under which Cook did not gain any equitable interest in the real estate. But, while the latter conveyed the fee, it was only for the accomplishment of the objects recited in the agreement. No particular form of words is required to create a trust. But whether one exists or not is to be ascertained from the intention of the parties. Carpenter v. Cushman, 105 Mass. 417, 419; Combs v. Brown, 29 N. J. Law, 36, 39. Plainly, Cook did not intend to surrender the advantage coming to him under the bargain, though willing that his associates, for their own security and convenience, should have the sole legal title, while it was understood between them that the instrument should not be placed on record. Even if the ratio of division was changed from what it would have been under the first deed, the less amount coming to him well may have been decided upon in view of the financial burden assumed by them, to which he has not proportionately contributed. They engaged and became bound to deal with the property not only for their own benefit, but for his. In doing so they were under an obligation to proceed diligently, to act in good faith in its management, to account for all sales, and to pay over his share of the common fund, which, upon sales being made, took the place of the land. Although not nominally so designated, they thus became trustees under an express trust. Baylies v. Payson, 5 Allen, 473, 488; Urann v. Coates, 109 Mass. 581; Brown v. Cowell, 116 Mass. 461; Dorr v. Clapp, 160 Mass. 538, 36 N.E. 474.
We proceed, then, to inquire whether Cook, or his assignee, can maintain their bill for an accounting. The parties contemplated, and it is expressly stipulated, that all are to 'make use of their best skill and exertions to make sale of said real estate.' There was a joint enterprise, to the successful promotion of which each was to contribute his time and services. No permission is given, nor is any implied, that either party, without the assent of the other, should assign his interest, and, while freeing himself from a personal performance of his part of the obligation, insist upon its satisfaction by the other. All clearly were bound to participate in the joint undertaking, and to contribute their individual efforts for its success. Griggs v. Moors, 186 Mass, 354, 361, 47 N.E. 128. If Mary A. Cook, as the assignee of her husband, in equity can bring suit in her own name on the cause of action assigned, her right of recovery is commensurate with whatever equitable claim he may have. When this is ascertained, her rights also are defined. Pike v. Waltham, 168 Mass. 581, 47 N.E. 487; Chapin v. Pike, 184 Mass. 184, 68 N.E. 42; Griggs v. Landis, 21 N. J. Eq. 494, 514. In order to make the enterprise commercially profitable, it was contemplated that the lots should at once be put upon the market, and sales continuously made until all were sold. The element of time thus became material, and before any final accounting could be asked for by Cook he must have performed his covenant. Garcin v. Pennsylvania Furnace Co., 186 Mass. 405, 71 N.E. 793; Dunklee v. Adams, 20 Vt. 415, 50 Am. Dec. 44. Instead of contributing his services to the development of what had been undertaken, after little more than a year had elapsed by his demurrer he admits mits that voluntarily he ceased to participate, made an assignment of his interest, through a third party, to his wife, then went into bankruptcy, and shortly thereafter removed from the state; while, under the allegations of his own bill, from 1876, when he severed his connection with the enterprise, to 1905, when he brought this suit, or for a period of 29 years, he failed to make any exertions, use his skill, or interest himself in any manner in making sales. But one conclusion justly can be reached, which is that he deliberately failed to perform the peciprocal duties imposed upon him, and intentionally abandoned the undertaking.
It is argued that, if the rendition of services by Cook is treated as a condition precedent to any right to an accounting by him of all that has been done under the trust up to the time of his suit, such construction is equivalent to a forfeiture of his equitable interest. And the result thus reached would be the same as if the stipulation were considered a condition subsequent, where equity affords relief from a forfeiture but does not lend assistance to enforce it. Horsburg v. Baker, 1 Pet. 232, 236, 7 L.Ed. 125. But, while the principle invoked is well settled, and should be applied in a proper case to prevent injustice, in the discretionary power of a court of equity it should not be used to the manifest wrong of those against whom its application is sought. Mactier v. Osborn, 146 Mass. 399, 402, 15 N.E. 641, 4 Am. St. Rep. 323, Henry v. Tupper, 29 Vt. 358. Performance of the agreement as originally contemplated was made impossible by the act of Cook. He deliberately put the whole burden upon his associates, with any attendant inconvenience and loss to them which might arise from his failure of co-operation. They are not in default, and to allow him to treat his failure to perform as conferring...
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