A. and B. in November, 1848, entered into an agreement under
seal providing for the settlement of longstanding and disputed
accounts. A balance from B. to A. was ascertained and the mode of
payment and security agreed upon. A. released property of B. from
the lien of judgments. B. among other things stipulated that he
would obtain partition of certain lands wherein he had an undivided
interest and convey in fee the part assigned to him in severalty to
A. at such price as should be adjudged by three appraisers, one to
be appointed by A., one by B. and one by the other two, such price
to be credited on the judgments held by A. against B., and that the
latter would give good security for the balance remaining due. B.
died in 1849. There was no partition until 1866, when it was
effected by his devisees, a fact not known to A. until 1872. They
have made to A. no conveyance of the part of said lands assigned to
them in severalty. A. filed his bill in 1876 alleging that he had
performed all the stipulations on his part to be performed and that
$40,000 of the original debt with accruing interest remains unpaid,
and praying for such a conveyance, for the ascertainment of the
balance under the order of the court and for general relief. The
devisees demurred.
Held:
1. That upon the case made by the bill, A's remedy was not
barred by the lapse of time.
2. That A., having under the agreement parted with rights, and
B. received value the consideration of which was in part the
stipulation concerning the lands, the agreement for the conveyance
can be specifically enforced, and the court will, if it be
necessary, provide a mode for ascertaining the value of the
lands.
Page 101 U. S. 427
The facts are stated in the opinion of the Court.
MR. JUSTICE MILLER delivered the opinion of the Court.
The appellants, in their character of trustees of the Bank of
Washington, brought this suit against the executors and devisees of
Daniel Carroll. The charter of that bank expired a great many years
ago, and the trustees who conduct its affairs are acting under a
statute of Congress. At the time of the expiration of the charter,
there was a large indebtedness on his part to the institution, a
portion of which was secured.
There were several judgments against him in favor of the bank,
and he had a suit in chancery for the adjustment of disputed
matters in regard to that indebtedness.
On the 3d day of November, 1846, an agreement under seal was
entered into between him and the trustees by which all their
disputes were settled. The sum due by him to the bank was
ascertained and the mode of payment and security agreed upon.
This agreement is the foundation of the present suit. Among
other things completed at the time was the payment of part of his
debt, the release of certain real estate from the lien of the
complainants' judgments, and his transfer of judgments held by him
against other persons to the trustees, with an understanding that
all moneys thereafter collected on them should be credited on the
judgment of the bank against him. Certain property known as the
Sligo estate, in which he had an undivided interest, was by him to
be conveyed to the bank as soon as he could procure a partition
with the other part owners. He also covenanted that after all this
was done, he would give good security for any balance due by him to
the bank. As the agreement with regard to the Sligo property is the
matter of principal importance in this suit, we give that part of
it verbatim:
"The said Daniel Carroll shall forthwith cause, at his expense,
the property known as the Sligo estate, of which he is the owner of
an undivided share, to be legally or equitably divided between him
and the other owner or owners thereof, and
Page 101 U. S. 428
shall immediately thereafter, by a valid deed, convey the share
or portion of said property which may be allotted to him unto the
trustees of the said bank, or as they may direct, in fee simple at
such price as three competent freeholders -- to be selected, one by
the said Daniel Carroll, another by the trustees of said bank, and
the third by the other two appraisers -- shall estimate and adjudge
the same to be worth, as if sold on a credit of three equal
payments at one, two, and three years, with interest thereon
payable semiannually, and the price, on the due execution of said
conveyance to the trustees of said bank or as they may direct,
shall be credited against the said judgments so as aforesaid held
by the bank against said Daniel Carroll."
Much of the agreement was performed on both sides. Money was
paid and property released. The bill avers that all which the
trustees agreed to do, or could do, was done, and that there is,
including interest, over $40,000 of the original debt unpaid, and
that no security has been given. In reference to the Sligo
property, it is alleged that no partition was made by Carroll in
his lifetime -- he died in May, 1849 -- but that his devisees
effected such partition in 1866, and have since sold some part of
the property allotted to them in that partition and received the
purchase money. It also alleges that the trustees were not aware
that any such partition had been made until 1872, this suit having
been commenced in 1876. They also set up an attempt in 1875 to
bring these matters before the court in the original chancery suit,
pending when the agreement was made, by an amended bill and
revivor, which was overruled.
The defendants filed a general demurrer setting up twenty
grounds of demurrer. It was sustained by the court below and the
bill dismissed.
The demurrer must be overruled if there be any part of the bill
which entitles the complainants to relief.
The main ground of the demurrer -- the lapse of time since the
cause of action accrued -- is relied on in reference both to the
statute of limitations and the general doctrine of laches. If the
judgments against Carroll have never been revived by
scire
facias or otherwise, the debt which they represented is
Page 101 U. S. 429
barred by limitation and its collection cannot be enforced by
any proceeding at law. The bill is silent on that subject. It may
admit of doubt whether in the mere absence of any such allegation
the court will raise the presumption of payment on which the
equitable defense is founded. Without deciding this, we think there
is another ground on which defendants must be put to their answer,
and in that answer they can plead or rely on the statute or the
lapse of time coupled with an averment that the judgments are no
longer alive.
That matter concerns the Sligo property. No bill for specific
performance could have been brought against Carroll or his devisees
before the partition required by the agreement was made. The delay
in making it was that of Carroll and of his devisees. For this the
complainants were in no manner chargeable with laches, and should
receive no detriment. Frye on Specific Performance, sec. 740;
Ridgway v. Wharton, 6 H. of L. Cas. 237.
The partition was made in 1866, and the knowledge of it did not
come to the complainants until 1872. If they had known it as soon
as it occurred, six years, under all the circumstances, would not
be considered as an unreasonable delay on their part in view of the
fact that the defendants had taken twenty years to perform one part
of the contract -- namely to make partition.
In 1872, as soon as they learned that the partition had been
made, the trustees attempted to assert their rights by an effort to
revive the old chancery proceeding out of which the agreement
arose. Being defeated in this, they commenced the present suit in
March, 1876. We think that on the face of the bill, they are not
barred by lapse of time. If there are other matters not shown in
the bill which would make that a bar, no injury can accrue by
requiring them to be shown by way of answer or plea.
It is said, however, in regard to the Sligo property that the
original contract is one of which a court of equity cannot enforce
specific performance because the price to be paid for it is not
definitely fixed, and a court of equity cannot enforce the
agreement to submit the question of price to the award of
arbitrators.
Page 101 U. S. 430
It cannot be successfully disputed that in the general terms
thus stated, this is the established equity doctrine. It would be
applicable if this was a case in which the complainants had agreed
to buy and the defendants to sell, the conveyance of the property,
and the actual payment of the price resting in covenants yet to be
performed, the latter being the sole consideration of the
former.
It is, however, quite otherwise in the matter before us. This
particular clause was only one of many which adjusted longstanding
and complicated transactions and compromised a vexatious
litigation. Moneys were paid, liens released, sureties discharged,
and suits settled by this agreement. Under, it the complainants
parted with rights and Carroll received value, the consideration of
which was, at least in part, this stipulation about the Sligo
estate.
The contract differs in another particular from the cases cited
to show that it cannot be enforced. The doctrine there rests upon
the ground that the court must be enabled to enforce the payment of
the price simultaneously with compelling the conveyance, and it
cannot do this by enforcing an arbitration. But in the case before
us, the price was already paid. The money was in Carroll's hands.
The only thing to be done was to determine how much of his debt to
the bank was to be satisfied by the conveyance. The case is
therefore one in which the land was sold to the bank and the
purchase money left in the hands of the vendor. By the terms of the
agreement, Carroll was to convey immediately after partition, and
then the price was to be ascertained. If he had conveyed, as it was
his duty to do, or if his heirs had conveyed as soon as they had
made partition, the conveyance would not be rescinded because they
could not agree upon the price or upon arbitrators. With the title
in the complainants and the money in possession of defendants, a
court would find a way to ascertain the credit to be allowed on
Carroll's debt to the bank.
Another view is the probability that Carroll's debt as to
everything else is barred, and that the debt is three or four times
the value of this property, so that its valuation is a mere form,
immaterial to either party.
In view of a court of equity, a contract for the sale of land
is
Page 101 U. S. 431
treated, says Mr. Justice Story, for most purposes precisely as
if it had been specifically performed. The vendee is treated as the
owner of the land and the vendor as the owner of the money. The
vendor is deemed in equity to stand seised of the land for the
benefit of the purchaser, and the trust attaches to the land so as
to bind the heir of the vendor. 1 Story, Eq.Jur., sec. 790, and the
cases there cited. Of course the equity here stated is stronger
when the purchase money is actually in the hands of the vendor.
Nor is the principle inflexible that the court will not
specifically enforce the contract where the price is not fixed or
is left to be fixed by arbitration.
Cheslyn v. Dalby, 2 Y. & C. 170, is very much like
the present case. Cheslyn, being indebted to Thomas Dalby in a
large unliquidated sum, gave a deed of trust for money borrowed at
the time from another party, with a stipulation that it should also
stand as a security for the unliquidated debt of Dalby to be
afterwards ascertained by arbitration. Cheslyn having paid the
principal sum secured by that deed, brought suit for a
reconveyance, and Dalby filed a cross-bill to have his debt paid
out of the property before this was done. The objection was raised
that this was in the nature of a specific execution of the deed,
which the court would not decree, as the amount was uncertain and
could not be ascertained in the stipulated mode, as no award had
been made and the umpire was dead. But the objection was
overruled.
Alderson, B., said:
"This agreement is composed of two distinct parts: 1. It is
admitted there is some balance due to Thomas Dalby, and it is
agreed that the estate is to be subject to a lien for that balance;
but 2dly, there is also an agreement as to a specific mode of
ascertaining that balance in case of dispute. Now the latter has
failed by events over which the parties had no control. But it
seems to me that notwithstanding this, the former part remains
entire, and if Mr. Cheslyn has admitted that there is a balance
due, and has by a deed, executed under such circumstances as that
it ought to be enforced, agreed that his estate should be subject
to a lien for that balance, why am I to decree a reconveyance of
the estate without compelling him to fulfill that part of the
agreement? "
Page 101 U. S. 432
It was accordingly referred to a master to state an account in
which this unascertained balance of Dalby's debt should be
included.
In the present case, Carroll made his agreement, in which a
balance ascertained was admitted to be due; the land was to stand
in part payment of this balance. He died before arbitrators could
be appointed to fix the sum at which the estate should be taken.
The demurrer admits all this.
Dinham v. Bradford, Law Rep. 5 Ch. 519, is another case
in which, where one partner was in a certain event to take the
partnership assets at a valuation to be ascertained precisely as in
the case before us, Lord Hatherley said:
"Here is a man who has had the whole benefit of the partnership
in respect of which this agreement was made, and now he refuses to
have the rest of the agreement performed on account of the
difficulty which has arisen. . . . If the valuation cannot be made
modo et forma, the court will substitute itself for the
arbitrators."
So of the case before us. Carroll has all the benefit of the
agreement, in releasing property from liens, in paying his debt by
his claims on others and in a long indulgence, and now, because he
has died without appointing arbitrators, his heirs say this part of
the agreement must fail.
We think on the whole the demurrer should be overruled and
defendants put to their answer, and for this purpose the decree of
the court below will be reversed, and the case remanded to it for
further proceedings, and it is
So ordered.