Zulver Realty Co., Inc. v. Snyder

• Decision Date: 10 November 1948
• Docket Number: 7.
• Citation: 62 A.2d 276,191 Md. 374
• Parties: ZULVER REALTY CO., Inc. v. SNYDER et al.
• Court: Maryland Court of Appeals

62 A.2d 276

191 Md. 374

ZULVER REALTY CO., Inc. v. SNYDER et al.

No. 7.

Court of Appeals of Maryland

November 10, 1948

Appeal from Superior Court of Baltimore City; Joseph Sherbow, Judge.

Suit by Nathan Snyder and another against the Zulver Realty Company Inc., to recover a deposit made as part payment in purchase of a lot. From the judgment, defendant appeals.

Reversed without a new trial.

Abram C. Joseph, of Baltimore (Samuel B. Rochkind, of Baltimore, on the brief), for appellant.

Eugene Hettleman, of Baltimore (Earl I. Rosenthal, of Baltimore, on the brief), for appellees.

Before MARBURY, C.J., and DELAPLAINE, COLLINS, HENDERSON, and MARKELL, JJ.

DELAPLAINE Judge.

This suit was instituted by Nathan Snyder and Isaac Read to recover from Zulver Realty Company, Inc., a Maryland corporation, a deposit of $2,000, which they had made as part payment in the purchase of a lot of ground improved by a three-story apartment building situated at 3022 Garrison Boulevard in the City of Baltimore.

The property was sold at auction on November 6, 1947, for $20,925, and the purchasers agreed to pay the balance of the purchase price within 30 days. On November 25 Earl I Rosenthal, attorney for the purchasers, cast doubt upon the marketability of the title, advising the corporation that the property had been owned by Anna M. Shaw at the time of her death in 1944, and that it was subsequently sold by her executors, but that it was questionable whether they actually had the power to sell it. On December 8 the attorney wrote another letter to the corporation demanding that it procure a confirmatory deed from the heirs of Mrs. Shaw on or before December 15. The corporation proceeded to do so, and on December 26 informed plaintiffs that it had received the instrument and would record it on Monday, December 29. But in the meantime on December 24 the purchasers had already entered suit to recover the amount which they had paid on the day of the sale. They alleged that they were ready and willing to consummate the sale prior to December 6, but defendant was unable to deliver a good and merchantable title to the property, and consequently they canceled the contract and demanded a return of the deposit. The Court held that the title was not marketable, and entered judgment accordingly in favor of plaintiffs for $2,000. From that judgment defendant took this appeal.

First. The chief objection to the title was that the will of Mrs. Shaw did not explicitly direct her executors to sell the property, and hence the sale was not valid and effectual, even though ratified by the Orphans' Court of Baltimore City. By mandate of the Legislature, the Orphans' Courts in this State shall not, under pretext of incidental power or constructive authority, exercise any jurisdiction not expressly conferred by law. Code 1939, art. 93, sec. 272. The Orphans' Courts thus have only a special and limited jurisdiction, and the facts necessary to clothe them with jurisdiction must affirmatively appear upon the face of their proceedings. Norment v. Brydon, 44 Md. 112, 116; Mudge v. Mudge, 155 Md. 1, 141 A. 396; Baldwin v. Hopkins, 171 Md. 97, 100, 187 A. 884; Talbot Packing Corporation v. Wheatley, 172 Md. 365, 369, 190 A. 833; Inasmuch Gospel Mission v. Merchantile Trust Co., 184 Md. 231, 234, 40 A.2d 506. One of the sections of the Maryland Testamentary Act provides that in case any executor or administrator shall not have money sufficient to discharge the just debts of and claims against the decedent, the Orphans' Court shall, on his application made after the return of an inventory, direct a sale of the whole property therein contained, or of such part, or to such an amount as the court may think proper. Code 1939, art. 93, sec. 292. In the case at bar it was conceded that the sale of Mrs. Shaw's real estate was not made in pursuance of that section. The sale was concededly made in pursuance of Section 301 of Article 93, which provides as follows: 'In all cases where an executor may be authorized and directed to sell the real estate of a testator, such executor may sell and convey the same, and shall account therefor to the orphans' court of the county where he obtained letters, in the same manner that an executor is bound to account for the sales of personal estate; * * * but such sale shall not be valid or effectual unless ratified and confirmed by the orphans' court, after notice by publication given in the same manner as practiced in cases of sales of lands under decrees in equity; * * *.'

From an examination of Mrs. Shaw's will, we find that she clearly expressed her intention to confer upon her executors the power to sell her real estate. She explains in her will that inasmuch as her daughter, Anna F. Shaw, had advanced the sum of $1,000 to pay for the building of a garage on one of her properties, it is her desire that, when the said property is sold, she may be repaid that sum; and she therefore bequeaths the sum of $1,000 to this daughter with the express direction that it shall be paid to her 'when the Executors shall sell my Garrison Avenue Home.' In addition, she directs that her executors shall pay all her debts, and divide the residue of her estate into six equal parts. It appeared from the account of the executors that there was no source other than the real estate from which the debts and bequests could be paid. Here, then, was an imperative necessity to make sale of the real estate in order to carry out the wishes of the testatrix. We hold that even when a testator directs that his real estate shall be sold, without expressly naming those who are to sell it, and also directs that the proceeds of sale shall be applied to the payment of debts or legacies, the executors have the power of sale by implication. Peter v. Beverly, 10 Pet. 532, 565, 9 L.Ed. 522, 535; Ogle v. Reynolds, 75 Md. 145, 151, 23 A. 137; Talbott v. Compher, 136 Md. 95, 100, 110 A. 100; Tilghman v. Frazer, Md., 59 A.2d 781. Moreover, whenever, it is necessary to sell real estate in order to effectuate the intention of the testator, there is an equitable conversion, although the testator gave the executor only a power of sale and did not expressly direct the sale to be made. The necessity to convert real estate into personalty to accomplish the purposes expressed by the testator is equivalent to an imperative direction to convey. Stake v. Mobley, 102 Md. 408, 415, 62 A. 963.

Second. Plaintiffs also questioned the validity of the deed from Isidor Zulver and wife to Zulver Realty Company, Inc., the last deed in the chain of title. The ground of attack was that when the grantors signed the deed on January 3, 1947 the grantee had not yet been incorporated. The certificate of incorporation was signed by Isidor Zulver and his wife and three other incorporators on January 4, and was received for record and approved by the State Tax Commission on January 6. It is elementary that it is essential for the validity of a deed that there shall be a grantee capable of taking the title at the time of the conveyance. Duffield v. Duffield, 268 Ill. 29, 108 N.E. 673, 675, Ann.Cas.1916D, 859; United States v. Southern Colorado Coal & Town Co., C.C., 18 F. 273, 276. So a deed to a supposed corporation which has not been duly incorporated and consequently has no legal existence does not pass any title. Harwood v. Masquelette, 95 Ind.App. 338, 181 N.E. 380; Long v. St. Louis Union Trust Co., 332 Mo. 288, 57 S.W.2d 1071, 1075; Black v. Stephenson, 166 Ark. 429, 267 S.W. 130, 132. But in this case the deed to Zulver Realty Company, Inc., was not recorded until October 27, 1947, nearly ten months after the company was incorporated. It is recognized that a deed takes effect only from the time of its delivery, and that time is the true date of the deed. 4 Kent's Commentaries, 13th Ed., 454. As Judge Bryan said in Gorsuch v. Rutledge, 70 Md. 272, 277, 17 A. 76, 77: 'A deed without delivery is in an imperfect state, and has no effect whatever.' In the absence of evidence of the date of delivery, there is a prima facie presumption that the deed was delivered on the day of its date. But this presumption may be rebutted by evidence that the deed was delivered on a subsequent day. Barry v. Hoffman, 6 Md. 78, 87. As emphasized by the United States Supreme Court in United States v. Le Baron, 19 How. 73, 15 L.Ed. 525, 526, when it is shown by competent evidence that a deed was not delivered to the grantee until a subsequent day, the deed takes effect as of that...