Where a woman, with the consent of her husband, bought land and
gave her promissory notes for part of the purchase money, which
bear ten percent interest per annum, a rate allowed by the laws of
the state when a special contract therefor is made, and the vendor
reserved in the deed a lien to secure the payment of the notes, and
she and her husband went into possession, erected permanent
improvements, and made payments on the notes,
Held:
1. That she, though consenting to account for rents and profits,
is not entitled, by reason of her coverture, to have the sale set
aside and the purchase money already paid refunded, nor will she or
her husband be allowed anything for the improvements.
2. That for the amount remaining due upon the notes according to
their tenor and effect, the lien may be enforced by a sale of the
land.
The case is fully stated in the opinion of the Court.
MR. JUSTICE BRADLEY delivered the opinion of the Court.
This case arises on a bill in equity filed by G. W. Burton, the
appellee, alleging that in February, 1872, he sold and conveyed to
America Bedford, one of the appellants, wife of John R. Bedford,
the other appellant, in fee, for her separate use, free from the
control of her husband, a certain tract of land in Tennessee, for
the consideration of $7,500, one-third of which was paid down,\ and
the balance secured by the promissory notes of Mrs. Bedford,
drawing interest at the rate of ten percent per annum. The deed of
conveyance specified these notes, and reserved a lien on the land
for the payment thereof. The notes were paid in part but not in
full, and the bill was filed for the foreclosure and sale of the
land to raise the balance due. The defendants, Bedford and wife,
filed a demurrer, which was overruled, and thereupon they filed an
answer and cross-bill, admitting the facts stated in the bill, and
that they took and still had possession under the purchase, and the
cross-bill alleged that the defendants had made permanent
improvements on the land to the value of $500, and claimed that the
sale was void because of the coverture of the grantee, and
Page 106 U. S. 339
prayed that it might be declared void, and that Burton should be
decreed to refund the amount paid on the purchase, together with
the value of the improvements, with interest, after deducting the
value of the rents while the property was occupied by the
defendants. Burton demurred to the cross-bill, and on final hearing
the court sustained this demurrer and made a decree for the
foreclosure and sale of the property as prayed in the original
bill, but declared that the complainant was not entitled to a
personal judgment against America Bedford. From this decree the
defendants have appealed.
The decree is sought to be reversed on two grounds, first
because the sale to America Bedford was void by reason of her
coverture, and ought to be declared void and the money paid by her
decreed to be refunded; secondly because the decree gives ten
percent interest on the notes -- a rate of interest which is not
allowed by the law unless there is a special contract therefor, the
legal rate being only six percent, and a
feme covert is
incapable of making such special contract.
The authorities are numerous and conclusive to the effect that a
feme covert may, with her husband's consent, take land by
purchase, and that a security given thereon by her for the purchase
money will be enforced. It was so held by this Court in the case of
Chilton v. Braiden's
Administratrix, 2 Black 458, where a lien for the
unpaid purchase money of land sold to a married woman was enforced
by a decree for the sale of the land. Mr. Justice Grier, delivering
the opinion of the Court, said:
"When one person has got the estate of another, he ought not in
conscience to be allowed to keep it without paying the
consideration. It is on this principle that courts of equity
proceed as between vendor and vendee. The purchase money is treated
as a lien on the land sold, where the vendor has taken no separate
security."
In a well considered case decided by the Chancellor of New
Jersey,
Armstrong v. Ross, 20 N.J. 109, where property was
sold and conveyed to a married woman and she and her husband
executed a mortgage for the purchase money, but the execution by
the wife was void because she was not privately examined, it was
nevertheless held that the vendor had a lien for the purchase
money, and also that the mortgage, being given for the benefit of
her
Page 106 U. S. 340
separate estate, although void as a mortgage, might be decreed a
lien on such separate estate. In the case of
Willingham v.
Leake, 7 Baxter 453, it was held by the Supreme Court of
Tennessee that where land was sold and a title bond given to a
married woman, who gave her notes for a part of the purchase money,
the vendor's lien could be enforced although the notes might be
void as against the vendee personally. In the subsequent case of
Jackson v. Rutledge, 3 B.J.Lea 626, decided as late as
December term, 1879, the same court held that if a married woman
buy land partly for cash and partly on time, and accept a deed of
conveyance to her separate use, a lien being retained for the
unpaid installments, she cannot have the money which she has paid
refunded merely because of her coverture, and the lien reserved for
the payment of the purchase money may be enforced in equity. This
case was nearly parallel to the present. A deed was executed to the
married woman for her sole and separate use, retaining a lien on
the land for the payment of the notes given for the purchase money,
and the grantee and her husband went into possession. A cross-bill
was filed, as in the present case, seeking to set aside the
contract as void and for a return of the money paid and the value
of permanent improvements. A decree for the sale of the land to
satisfy the unpaid purchase money was made by the chancellor, but
no personal decree against the parties. This decree was affirmed by
the supreme court in an elaborate judgment in which the authorities
on the subject are fully reviewed. The court concludes the
examination by saying,
"If the conveyance be to the sole and separate use of the
married woman, there seems to be no difficulty in treating a debt
contracted in the purchase as binding on the property, although not
personally obligatory on the feme, because where she takes
possession under the conveyance the debt is contracted for the
benefit of her separate estate."
Again:
"Her incapacity to execute valid notes, if we treat the purchase
notes as void on that ground and because not expressly made
obligatory on her separate estate, would not affect the vendor's
right to subject the land to the satisfaction of the unpaid
purchase money by virtue of the vendor's equity and of the lien
reserved. By the delivery and acceptance of the deed of conveyance,
the
Page 106 U. S. 341
contract was executed and the title vested in her. She takes the
title subject to the charge created by the terms of the deed.
Trezenant v. Bettis, 1 Leg.Rep. 48;
Lee v.
Newman, 1 Memph.L.J. 139;
Eskridge v. Eskridge, 51
Miss. 522. Under such circumstances, the married woman is not
entitled to have the cash payment refunded. In making the payment,
as we have seen, she exercised a right which the law concedes. . .
. All she can claim is exemption from personal liability."
These cases decided by the highest court of Tennessee, where the
land lies and where the transaction took place, are of stringent
authority, and they accord with our own views of the law.
It should be added that by the statute law of Tennessee,
"Married women over the age of twenty-one years, owning the fee
or other legal or equitable interest or estate in real estate,
shall have the same powers of disposition, by will, deed, or
otherwise, as are possessed by
femes sole, or unmarried
women."
Code of Tennessee, sec. 2486. This provision would seem to be
sufficient to confer upon a married woman purchasing land to her
own use power to execute a mortgage upon the land to secure the
purchase money -- binding at least upon the land, if not creating
any personal obligation against her.
But the present case is a stronger one than that of a mortgage.
The deed by which she holds the property is qualified by expressly
retaining a lien for the payment of the purchase money. The lien
goes with the estate and affects it in a manner similar to a
condition. It is indeed in the nature of a condition impressed upon
the estate itself. It makes the deed say in effect, "I convey to
you the land, but only upon the condition that you pay the notes
given for purchase money; if they are not paid, I am to hold it as
security."
This peculiar character of the lien seems to be a good answer to
the second ground for reversal -- the reservation of interest at
the rate of ten percent per annum on the notes. Ten percent is not
an unlawful rate of interest in Tennessee. It may be reserved if
the parties so agree. If they make no agreement, the law gives six.
The agreement to pay ten percent in this case may not be binding on
the wife personally,
Page 106 U. S. 342
but it is not binding on the same ground that the principal is
not binding upon her personally. Nevertheless, as it is a rate that
may be lawfully stipulated for, if it is stipulated for and is made
part of the consideration for which a lien is retained on the land,
it is as much secured by the lien as the principal is.
We see no error in the decree, and it is therefore
Affirmed.