Stephen v. Beall - 89 U.S. 329 (1874)
U.S. Supreme Court
Stephen v. Beall, 89 U.S. 22 Wall. 329 329 (1874)
Stephen v. Beall
89 U.S. (22 Wall.) 329
1. Where one of four joint tenants makes a deed of trust (a mortgage) of land conveyed to the four -- the deed of trust purporting to convey the whole estate -- it is not necessary, on a bill filed to have the land sold under the deed of trust (in other words, to foreclose the mortgage), to make the three who do not convey parties defendant to the bill.
2. It is settled doctrine that a married woman may charge her separate property for the payment of her husband's debt by any instrument in writing in which she in terms plainly shows her purpose so to charge it, she describing the property specifically and executing the instrument of charge in the manner required be law.
3. Though equity will enforce in the most rigid manner good faith on the part of a trustee, and vigilantly watch any acquisition by him in his individual character of property which has ever been the subject of his trust, yet where he has sold the trust property to another, that sale having been judicially confirmed after opposition by the cestui que trust, the fact that thirteen years afterwards he bought the property from the person to whom he once sold it does not of necessity vitiate his purchase. The question in such a case becomes one of actual fraud. And where, on a bill charging fraud, the answer denies it in the fullest manner, alleging a purchase bona fide and for full value paid, and that when he, the trustee, made the sale to the person from whom he has since bought it, the purchase by himself, now called in question, was not thought of either by himself or his vendee -- the court will not decree the purchase fraudulent, the case being heard on the pleadings and without any proof's taken.
4. The complainants in this case, who alleged fraud and relied on the trustee's possession of the trust property after an alleged sale of it as evidence of it, not stating when the trustee came into possession -- that is to say, how soon after his former sale -- the court assumed the time to be thirteen years, this term having elapsed between the date of the sale by the trustee and the filing of the bill (or cross-bill, rather) to set it asides, the court acting on the presumption that the complainant stated the case as favorably as he could for himself, and would have mentioned the fact that the trustee had been in possession long before the bill was filed if he had really been so.
In the year 1849, by deed of bargain and sale, all in technical form, one Colburn conveyed to Mrs. Mary Bell and to her three children, John, Sarah, and Maria, by name, a piece of ground described, in the District of Columbia, with the appurtenances, the grant being
"unto the said Mary, John, Sarah, and Maria, their heirs and assigns forever, to have and to hold the said described land and premises with the appurtenances unto them the said Mary (the mother), John, Sarah, and Maria, their heirs and assigns forever, to them and their sole use, benefit and behoof forever."
The mother subsequently married a man named Beall, and so became Mrs. Mary Beall.
In this state of things, the estate of one Magruder, in Maryland, being about to be sold by a certain Stephen, as trustee, under a decree of court there, Beall bought it for $10,100, and in pursuance of the terms of sale as prescribed by the decree paid to Stephen, the trustee, $1,000 in cash, and gave to him his three notes, each for $3,033.33 1/3, secured by a deed executed by himself and wife, all with recitals of its history and purpose and with everything in or about it, in form, purporting to convey the whole of the tract of land which Colburn in 1849 had conveyed to her the said Mrs. Beall (while bearing the name of Bell), and to her three children. The children were not parties to the deed of trust.
The order of court for the sale of Magruder's property
directed that a deed should be given by Stephen, the trustee, only on the payment by the purchaser of all the purchase money.
Beall, the husband, did not pay his three notes, and a resale by Stephen of the original property was directed by the court having jurisdiction of the matter. The proceeds were directed to be applied to discharge the three notes, and any surplus was to be paid to Beall. A resale by public auction was accordingly made on the 5th of May, 1859; the purchaser being one Crowley. The price, however, thus obtained was but $6,478, thus leaving a debt due by Beall of $2,622, exclusive of interest. The resale was reported to the court and was confirmed by it, after an opposition to it by Beall. To get satisfaction for the deficit of $2,622 and interest Stephen, the trustee, now, June, 1871, filed a bill in the court below against Mr. and Mrs. Beall, praying an account of what was due to him on the notes and a sale of the property which had been conveyed to him by Mr. and Mrs. Beall in the deed of trust, or of so much of it as would satisfy what should be found due.
Mr. and Mrs. Beall answered. They set up that at the time of the execution of the deed of trust, the title to the lot was in Mrs. Beall (then Mrs. Bell), "jointly with her children," naming them; and "submitted that the lot could not now be sold without affecting their rights."
They submitted further that Mrs. Beall could neither at law nor in equity pledge her separate estate for the payment of her husband's debt.
On a cross-bill filed by them, they averred that when the sale was made by Stephen as trustee, to Beall, Stephen misrepresented the value of the property, much exaggerating it, and promised to execute a valid deed to Beall for it, on receiving the $1,000 and the notes.
They averred further that Stephen was now in possession of the land of Magruder said to have been resold to Crowley, that the said resale was really made for Stephen, the trustee, and fraudulent as being a purchase made by a trustee at his own sale. They did not in this cross-bill state
when Stephen came into possession of the property once held by him in trust, nor state any other thing to show how long after the "resale" it was. The cross-bill itself was sworn to February 28, 1872.
Stephen, in answer to this cross-bill, denying his promise to execute any deed before the full purchase money was actually paid, admitted that he was in possession of the land resold, but averred that the resale to Crowley was a bona fide sale, and that he Stephen was in possession by a bona fide purchase from Crowley, and for full consideration which had been paid by him. He denied all fraud in the said purchase by Crowley on the resale and in his own purchase, and averred that his own purchase from Crowley was not thought of by either himself or Crowley until after Crowley's purchase had been made, and, of course, that it was made without any fraudulent combination with Crowley. But he did not state the date when he came into possession of the property on his alleged purchase from Crowley.
No proofs being made, the case was heard on the pleadings.
The court below dismissed the bill, and Stephen appealed.