Opinion
November Term, 1848
H.Z. Hayner, for the appellant.
J.H. Reynolds, for the respondents.
It is assumed by the chancellor that the land was not lost to Van Buren in consequence of a defect of title; but that if the mortgage was properly foreclosed, the title had been lost by his neglect to pay it. I think there is an obvious mistake in that conclusion. The bill concedes that the title to the lands was not conveyed to Van Buren, although he as well as his grantors supposed it was, by the deed executed to him. The complainants and the administrator of Van Buren have since discovered that Van Buren's grantors were never seized of any estate in the lands; that the turnpike corporation, at the time of executing the deed, was seized of these lands, and so continued, until its dissolution in 1840. How then can it be said that Van Buren lost the land or the title thereto, (which he never had,) by neglecting to pay the mortgage ? If he had paid it, it would not have invested him or his grantors with the title. Neither lost the land or title to it, by the foreclosure and sale. Payment of the mortgage by Van Buren in his lifetime, or by his administrator after his death, could have had no other effect than to increase the amount of damages which he or his administrator would be entitled to recover of his grantors for the breach of their covenant of seisin contained in their deed to him. Van Buren's right of action for the breach of that covenant was perfect the instant the deed was executed. ( Hamilton v. Willson, 4 John. 72; McCarty v. Leggett, 3 Hill, 134.) It did not arise or depend in any respect upon the foreclosure of the mortgage and sale under it. Nor did the foreclosure and sale in the least affect the complainants' rights or liabilities.
If Van Buren had paid the mortgages, and then he or his administrator, after his death, had brought an action for the breach of the covenant of seisin, it would not have been a good ground in equity for relief against their covenant, that he could have compelled the corporation before its dissolution to convey the title to him. He would have the right to rely on his covenant and take his remedy by action upon it.
Van Buren's grantors agreed with him that they were seized of the land, and it was their business to see that their covenant in that respect was kept, when they executed the deed. Equity may compel parties to execute their agreements, but has no power to make agreements for them, or to substitute one for another. And besides, it appears from the bill that the corporation even did not lose the land or its title by the foreclosure and sale under the mortgage. It had lost its title nearly or quite three years before, in 1840, by its dissolution. At that time, and for that cause, the title reverted back to its original grantor or his heirs, there being no provision in its charter or in any other statute to avert that consequence upon its dissolution. ( Angel Ames on Corp. 128, 129; 2 Kent's Com. 305.)
At all events the bill shows the dissolution of the corporation at the time mentioned, without showing that the title to their lands was saved in such manner as that Van Buren, or his representatives, could by any means have acquired it under the agreement and deed, even if he had paid the mortgages subsequently and before foreclosure; and it is not set up that he had agreed to pay, or that the holders of the mortgages were bound to receive, or would have received payment of the mortgages, or either of them, prior to the time of the dissolution of the corporation, or prior to the time of the death of Van Buren; or that he at any time knew or had notice that he could compel the corporation, or any other person, to convey to him the title to said land; or even that he knew or was informed that his grantors were not seized when they executed the deed. Therefore it seems to me that there is no ground upon which to sustain this bill, founded upon the neglect of Van Buren to pay the mortgages, or either of them.
But the chancellor held that even if the bill could not be sustained to the whole extent claimed, the demurrer was properly overruled on the ground that the complainants were entitled to relief so far as to restrict the defendant's claim upon the covenant to the amount of the purchase money actually paid by Van Buren, with interest thereon. I take it that the principle is settled, that if the complainants can avail themselves of this branch of their defence at law, and that objection is raised by the demurrer to the bill they should be left to make it in the suit at law; and the decree overruling the demurrer cannot be sustained on that ground. ( Colton v. Ross, 2 Paige, 396, 400.) And I think it is well settled, that for the purpose of ascertaining the damages to which a plaintiff may be entitled in an action at law for the breach of the covenant of seisin in a deed, the true consideration, and that all or any part remains unpaid, may be shown, notwithstanding a different consideration is expressed in the deed, and although it contains an acknowledgment on the part of the grantors that it has been paid at the time of or before the execution of the deed. ( McCrea v. Purmont, 16 Wend. 460; Shephard v. Little, 14 John. 210; Morse v. Shattuck, 4 N. Hamp. R. 229; Greenvault v. Davis, 4 Hill, 647; Beldon v. Seymour, 8 Conn. R. 304; Cowen Hill's Notes, 1441, 1442.)
My conclusion therefore is that the decisions of the court below are erroneous and should be reversed, and the bill dismissed with costs.
Ordered accordingly.