Appeal
from Circuit Court, Union County: L. L. Fleeger, Judge.
Action
by Ingmar C. Vangsness against Fannie Bovill. While the
action was pending, the defendant died, and Robert Bovill, as
executor of the last will of Fannie Bovill, was substituted
for the original defendant. From a judgment for plaintiff
and from denial of application for new trial, defendant
executor appeals.
Reversed.
CAMPBELL
J.
On July
26, 1928, plaintiff and Fannie Bovill entered into a written
contract whereby he agreed to sell and she agreed to buy
certain realty in the city of Beresford. Mrs. Bovill paid
$500 in cash at the time of the execution of the contract and
agreed to pay the balance of the purchase price, amounting to
$6,800 (or to pay part and give a certain mortgage for the
remainder) on August 1, 1928, at which time the contract
provided that plaintiff should furnish and deliver to Mrs.
Bovill a good and sufficient warranty deed to the premises
duly executed, and should also furnish abstract of title
showing good and merchantable title to said property, and
should deliver and assign to Mrs. Bovill the unexpired term
of certain insurance in force on the premises. The contract
contained no provision that time should be of essence
thereof.
On
August 1, 1928, Mrs. Bovill and one Frieberg, an attorney at
Beresford who was acting as representative of plaintiff
Vangsness, met at the Beresford State Bank. Frieberg brought
to the bank a warranty deed executed by Vangsness and wife,
the insurance policy on the premises, and an abstract of
title. He inquired of Mrs. Bovill if she was ready to make
the settlement under the contract, and she said she thought
she was. Mr. Frieberg then handed to Mrs. Bovill the abstract
of title and she handed it to Mr. Ontjes, the banker, and
asked him to look it over. Mr. Ontjes said that he did not
examine titles for himself and did not want to undertake to
do so for her. Mr. Ontjes then inquired of Mr. Frieberg if he
(Frieberg) thought the title was all right. Mr. Frieberg says
that he replied, "I told him no one had retained me to
examine the title. I had looked it through at the time it was
in my possession and I presumed it was all right." Mr.
Ontjes' testimony with reference to Frieberg's reply
is as follows: "He says, well, there is a tax deed out.
I says that being the case I would advise Mrs. Bovill to have
an attorney to examine the title. She then told me to have
Mr. Kaye (also an attorney practicing at Beresford) examine
it." In any event Mr. Kaye was called in and requested
to make an examination of the abstract in behalf of Mrs.
Bovill. He appears to have raised some question concerning
the abstract or the insufficiency thereof in certain
particulars, and apparently some further information was then
added or attached to the abstract and Mr. Kaye again examined
it. Under date of August 8, 1928, Mr. Kaye rendered an
opinion to Mrs. Bovill as follows:
"I have re-examined the title to the property above
described as shown by the abstract thereof, after the
proceedings of the foreclosure of the mortgage at entry
number 2.
"I am unable to pass this title as merchantable. The
suit to foreclose the mortgage was never decided upon its
merits, but on a technical ground of the failure of the
plaintiff to put up a cost bond, it was dismissed. Hence,
there has never been any determination of the action on the
merits. In addition, there is an outstanding tax deed which
should be removed. This is set out in entry number 3.
"The title should be quieted. Martha Vaughn being a
defendant, or if dead, her heirs at law. John La Plant should
be an additional defendant, so that we may have a judicial
determination of the fact that he never acquired an interest
in the property."
Thereafter
Mrs. Bovill submitted the abstract for further examination
and opinion to Mr. Carlson, an attorney at law at Canton, who
rendered an opinion stating in part and in material portions
as follows:
"* * * 1. The title to this property was at one time in
Fred J. Deane. From the abstract referred to, I find certain
copies which may be copies of the proceedings in relation to
his estate; but there is nothing in the certificate to the
title nor in the abstract upon which you could hold the
abstracter responsible for the correctness of those copies.
These copies may as well not be on the abstract at all. No
paper attached to the abstract is of any value or force
unless it is identified by the abstracter as a part of the
abstract and this is not done in this case.
"2. Assuming these copies to show the record of the
probate proceedings, then the title is not merchantable
because it appears from these copies that there was an
inheritance tax of $324.45 assessed against this estate. The
only evidence of payment of any tax is an affidavit signed by
the administratrix. This affidavit is of no value and does
not prove payment under any circumstances; moreover, it does
not purport to show payment of inheritance tax, and even if
it did, that is not the way to show the payment of such tax.
"3. The Petition for Final Distribution alleges the
payment of all debts and the payment of inheritance tax; such
statement in the petition is not conclusive on either of
these points and the decree of distribution fails to find
that the debts have been paid. Hence the title is defective
on this account.
"4. A more serious and difficult question arises from
the tax deed shown at Entry No. 3 of the abstract. The
abstracter states that this deed was dated March 30th, 1885;
but in his remarks he states, 'sold for taxes of
1889.' Clearly one of these two dates is wrong. Assuming
the latter date to be correct, the title would be clouded by
this tax deed because the natural inference would be that
this deed was based upon the taxes levied against the land
while it was subject to taxes under the entry made by the
subsequent patentee, Rasmus Pederson. Hence as long as the
abstract
stands in the condition in which it now is, the title is
clouded by that tax deed.
"5. An amendment to the abstract may show that the tax
deed was based upon an invalid tax; but the examiner cannot
indulge a presumption to that extent in the face of the
record. The abstract shows that one John LaPlant made an
entry upon this land receiving a receiver's receipt on
July 23rd, 1880. Under 'Remarks' the abstracter
states that this entry was contested by Rasmus Pederson and
was finally cancelled March 23rd, 1886. This is hardly the
way to abstract proceedings relating to contests, and in this
instance, on account of this tax deed, such proceedings are
essential and should appear on the abstract in detail.
"Under the abstract as it stands, I am not able to say
whether the tax deed conveyed any title; whether it did or
did not depends upon whether the taxes, upon which this deed
is based, were legally levied.
"Clearly this land was what is known as 'Public
Land.' Such lands are not liable to taxation until entry
thereon has been made and full payment to the United States
has been made. In the case of a homestead entry, the land is
not liable to taxation until the settler becomes entitled to
a patent, so that if this tax was levied against the land
under the entry made to John LaPlant and if that entry was
cancelled before LaPlant had the equitable title, then the
tax levied was illegal and the tax deed would be illegal. But
an attorney cannot pass upon facts which are not disclosed.
"For the reasons above given, the conclusion must be
that the tax deed is a cloud upon the title.
"This does not mean that the title of the present owner
could be defeated; it means that this tax deed raises a
question as to the title of the present owner, which question
must be answered by record facts and not by things generally
known to be facts. * * *
"As above stated, the question of whether this title is
merchantable depends on extraneous facts which do not appear
from the abstract.
"Of course, if the abstract was amended so as to show
that the State had no right to levy the taxes referred to and
upon which that tax deed was issued, then it would be clear
that the tax deed conveyed no title. But in the present
condition of the abstract, the conclusion is forced that this
tax deed, old as it is, is a cloud upon the title. * *
*"
The
opinions of these two examiners, or copies thereof, were
promptly submitted to plaintiff. Plaintiff appears to have
made no effort to meet the objections raised, but on August
21, 1928, commenced the present action for specific
performance of the purchase contract. Findings, conclusions
and judgment were in favor of plaintiff. Mrs. Bovill, the
defendant, gave notice of intention to move for new trial,
and on July 8, 1929, served and filed written notice and
motion for new trial, which motion was, by stipulation of the
parties, brought on for hearing on August 9, 1929, before
Honorable Ray E. Dougherty, judge of the circuit court, and
thereafter, and on October 4, 1929, Judge Dougherty made and
entered an order granting said application for new trial.
Between July 8, 1929, when the notice of motion for new trial
was given, and August 9, 1929, when said motion was submitted
to the court, Mrs. Bovill, unknown to her attorneys, had
died. Thereafter, and on November 5, 1929, plaintiff's
attorneys moved to vacate and set aside the order of October
4, 1929, granting a new trial, and the present defendant
Robert Bovill, having meantime qualified as executor of
Fannie Bovill, made application to be substituted as a party
defendant in the action. Both motions...
