Ejectment. John Ormsby died in Alleghany County, Pennsylvania,
in December, 1805, having a son Oliver, who administered to his
estate. He had also a son who had married in Mississippi, and who
died in 1795, leaving an infant daughter. Oliver Ormsby filed no
inventory of the estate of his father, and never settled an account
as administrator, and in 1826, he confessed a judgment in favor of
the Messrs. Penns for a part of the purchase money of a valuable
real estate which had been held by John Ormsby in his lifetime. In
the suit against him for this debt, Mr. James Ross acted as the
attorney for the plaintiffs, and in 1827 the real estate was sold
under an execution issued by Mr. Ross on the judgment and was
purchased by Mr. Ross for three thousand dollars, he having, before
the purchase, given Oliver Ormsby to understand and having publicly
declared that he would hold the property as a security for the debt
due to the Messrs. Penns, and on the payment of the debt that he
would relinquish all claim to it. In April, 1831, Oliver Ormsby
paid the debt to Mr. Ross and took a conveyance of the property. At
the same time, he gave a receipt, as administrator of John Ormsby,
to the sheriff for the balance of the three thousand dollars. He
claimed to hold the property so purchased as his own. In March,
1828, Oliver Ormsby wrote to the wife of the plaintiff in this
ejectment, who was the daughter of John Ormsby, junior, stating
that his father had not left more property than would pay his
debts. There was evidence that less than one-tenth of the real
estate would have satisfied the judgment for which the land was
sold to Mr. Ross. Mr. Ross had no knowledge of any fraudulent
purpose of the administrator. The daughter of John Ormsby, junior,
having intermarried with Gabriel Swayze, with her husband brought
an ejectment to recover a moiety of the land which
was held by Oliver Ormsby under the conveyance from Mr. Ross.
The court instructed the jury that
"In matters of fraud, courts of law and chancery have a
concurrent jurisdiction. It is therefore within the province of the
jury to inquire whether the conduct and proceedings of Oliver
Ormsby whereby the legal title to the property in dispute became
vested in himself for his exclusive use and benefit were in fraud
of his co-tenant Mary Swayze, and if they were, the"
verdict ought to be for the plaintiffs.
"That the fraud should be brought to the knowledge of Mr. Ross,
and that if Mr. Ross took a valid title under the sheriff's deed,
the title of the vendee would be good under the circumstances"
disclosed in the evidence.
By the Court: "We think that the judge erred in charging the
jury that the deed to Ormsby was valid unless they should find that
Ross participated in the fraud."
It is clear that a purchaser at sheriffs sale cannot protect
himself against a prior claim of which he had no notice, or be held
a
bona fide purchaser unless he shall have paid the
money.
That fraud is cognizable in a court of law as well as in a court
of equity is a well established principle. It has often been so
ruled in this Court.
As there is no court of chancery under the laws of Pennsylvania,
an action of ejectment is sustained, or an equitable title, by the
courts of that state. Such is not the
Page 37 U. S. 12
practice in the courts of the United States, and if the
plaintiffs in an ejectment fail to show a paramount legal title in
themselves, they cannot recover.
The case, as stated, in the opinion of the Court was as
follows:
An action was instituted in the District Court of the United
States for the Western District of Pennsylvania by the lessors of
the plaintiffs, Gabriel Swayze and wife, citizens of the State of
Mississippi, for the recovery of a tract of land in Alleghany
County in the State of Pennsylvania, to October sessions, 1833.
The plaintiffs and the defendants claimed the land under a deed
from John Penn and John Penn, Jr., proprietaries of Pennsylvania,
the land forming part of one of the manors reserved by the
proprietaries. John Ormsby died intestate in 1791, and left a son,
named Oliver, a daughter, Sidney, who intermarried with John Gregg;
a son named John, who married and died in the State of Mississippi,
leaving a daughter Mary, an infant, at the time of his decease, and
who has since intermarried with Gabriel Swayze, the plaintiff in
error. In December, 1807, Oliver Ormsby administered to the estate
of his father, John Ormsby, and gave the usual administration
bonds, but he filed no inventory of the estate of the intestate,
nor did he at any time settle an account of his administration of
the estate.
The estate of John Ormsby, deceased, was indebted to John Penn,
and John Penn, Jr., for the land purchased from them, in the sum of
four hundred and sixty-seven dollars and sixty-four cents, and on 6
September, 1826, the administrator confessed a judgment in their
favor for the amount of the debt, upon which judgment an execution
was forthwith issued by Mr. Ross, their attorney, and the land of
John Ormsby was levied on and sold, Mr. Ross being the purchaser of
the same, for three thousand dollars. At the time of the purchase
of the estate, Oliver Ormsby, the administrator, was absent. Mr.
Ross declared in the most public manner that Ormsby, the
administrator, or any of the family of the deceased John Ormsby,
might redeem the land at any time, on the payment of the debt and
interest. Before the sale, Oliver Ormsby, the administrator, was
informed by Mr. Ross that he only wanted the money due upon the
judgment, and that he did not intend to buy the land to hold it.
Ormsby, the administrator, was in possession of the land at
Page 37 U. S. 13
the time of the sale, and continued in possession of it, and at
the time of the sheriff's sale, or when the deed for the land was
made to him by the sheriff, Mr. Ross paid no money. The rents and
profits of the land were continued to be received by Oliver Ormsby,
and in April, 1831, he paid to James Ross, Esq., the sum of five
hundred and twenty-three dollars, the amount of the judgment, and
the interest due thereon, and took from him a conveyance of the
land in fee simple, giving to the sheriff at the same time, as
administrator of John Ormsby, a receipt for the sum of three
thousand dollars, less five hundred and twenty-three dollars, the
amount of the payment to James Ross, Esq., in satisfaction of the
debt due to the Messrs. Penns. The land consists of eighteen coal
hill lots and of thirty-five acres of land adjoining to them, and
is now of great value. It was highly valuable at the time of the
sheriff's sale. The defendants were in possession of the property
as tenants of Oliver Ormsby when the suit was commenced.
In March, 1828, in answer to an application for information as
to the value of the estate of John Ormsby by Mrs. Swayze, one of
the lessors of the plaintiff, Oliver Ormsby wrote
"My father, at his death, was not possessed of more property
than a sufficiency to pay his debts, having, from time to time,
sold to individuals, and conveyed to his children."
Evidence was also given conducing to prove that by a sale of two
of the coal lots, the judgment could have been satisfied.
The case was tried at October term, 1835, and a verdict and
judgment were rendered for the defendants under the charge of the
district judge. The plaintiffs excepted to the opinion of the court
and prosecuted this writ of error.
On the trial of the cause, the counsel requested the district
judge to charge the jury
"In matters of fraud, courts of law and chancery have a
concurrent jurisdiction. It is therefore within the province of the
jury to inquire whether the conduct and proceedings of Oliver
Ormsby, whereby the legal title to the property in dispute became
vested in himself, for his exclusive use and benefit, were in fraud
of the rights of his cotenant, Mary Swayze, and if they were, the
verdict ought to be for the plaintiffs."
The court gave the instruction as requested, with this
qualification, that the fraud should be brought to the knowledge of
Mr. Ross; if he took a valid title, under the sheriff's deed, the
title of his vendee would be good, under the circumstances
disclosed in the evidence.
Page 37 U. S. 21
MR. JUSTICE McLEAN delivered the opinion of the Court.
An action of ejectment was brought in the Western District of
Pennsylvania by the plaintiffs against the defendants to recover
the land in controversy. Both parties claim by descent from John
Ormsby, R., who died in Alleghany County, Pennsylvania, in
December, 1805. The deceased had a son, Oliver, who survived him,
and who administered on his estate, and a daughter, Sidney, who
married Isaac Gregg. He had also a son called John Ormsby, Jr., who
married in the Mississippi country and died in August, 1795. Mary
Swayze, the wife of the plaintiff, is the daughter of this son, and
was an infant at his decease.
In December, 1807, Oliver Ormsby gave bond as administrator of
his father; but it seems he filed no inventory of the personal
estate, as the law required, nor did he ever settle his
administration account.
On 6 September, 1826, as administrator, he confessed a
Page 37 U. S. 22
judgment for four hundred and sixty-seven dollars and sixty-four
cents in favor of Messrs. Penns, Mr. James Ross acting as the
attorney of the plaintiffs. An execution was issued on this
judgment, and the premises were sold to Mr. Ross for three thousand
dollars. He declared publicly at the sale that Ormsby or any of his
family might redeem the land at any time on the payment of "debts
and interest," and Mr. Ross further states that before the sale,
Mr. Ormsby was informed that he only wanted the money on the
judgment, and that he did not intend to buy the land to hold
it.
No money was paid by Mr. Ross at the sheriff's sale or at the
time he received the sheriff's deed. Ormsby remained in possession
of the land, receiving the rents and profits, and in April, 1831,
four years after the sheriff's sale, he paid Ross five hundred and
twenty-three dollars, the amount of the judgment and interest, and
received from him a conveyance of the land. At this time Ormsby
receipted to the sheriff as administrator for the balance of the
three thousand dollars, after deducting the amount paid to Ross.
The sheriff's deed to Ross and the deed from him to Ormsby were
recorded on the same day.
The land in controversy consists of eighteen coal hill lots near
Pittsburgh and thirty-five acres adjoining them and which is now of
great value and was worth a large sum at the time of the sheriff's
sale.
There was a letter in evidence, written by Oliver Ormsby to Mrs.
Swayze, dated 19 March, 1828, at Natchez, in which he says:
"My father, at his death, was not possessed of more property
than a sufficiency to pay his debts, having from time to time sold
to individuals and conveyed to his children."
And there was evidence conducing to show that the sale of two of
the lots would have satisfied the judgment.
On these facts and others in the case, the counsel for the
plaintiffs prayed the court to instruct the jury that
"in matters of fraud, courts of law and chancery have a
concurrent jurisdiction. It is therefore within the province of the
jury to inquire whether the conduct and proceedings of Oliver
Ormsby whereby the legal title to the property in dispute became
vested in himself for his exclusive use and benefit, were in fraud
of his co-tenant, Mary Swayze, and if they were, the verdict ought
to be for the plaintiffs."
This instruction was given as requested with this
qualification,
"that the fraud should be brought to the knowledge of Mr. Ross
and that if he took a valid title under the sheriff's deed, the
title of
Page 37 U. S. 23
his vendee would be good under the circumstances disclosed in
evidence."
To the refusal of the instruction as requested and the
instruction as given an exception was taken which raises the
question of law whether to render the title of Ormsby as set up by
the defendants inoperative and void it is essential that Ross
should have participated in the fraud.
The charge of the judge was explicit on this point. He not only
instructed the jury that to make the title of Ormsby fraudulent,
Ross must have had a knowledge of the fraud; but assuming, it would
seem, the province of the jury, he declared that the fairness of
the transaction was above suspicion.
That fraud is cognizable in a court of law as well as in a court
of equity is a well established principle. It has been often so
ruled in this Court.
As there is no court of chancery under the laws of Pennsylvania,
an action of ejectment is sustained on an equitable title by the
courts of that state. Such is not the practice in the courts of the
United States, and in this case, if the plaintiffs fail to show a
paramount legal title in themselves, they cannot recover.
It is unnecessary to inquire whether, under the circumstances,
Ormsby did not receive the conveyance of the land from Ross in
trust for the heirs of his father generally. This inquiry would be
appropriate in the exercise of a chancery jurisdiction on a bill
framed for the purpose. But the jury was limited to the question of
fraud. The deed by the sheriff to Ross and the one from him to
Ormsby contain upon their face all the requisites of legal
conveyances, and they must be operative to convey the title unless
the circumstances under which they were executed make them
void.
In 1807, Ormsby took out letters of administration, but he seems
to have acted in the management of the estate without regard to the
law or the obligations of his administration bond. He filed no
inventory, made no settlement of his accounts. In 1825 he promised
to pay the debt in the hands of Ross, but he took no step to
fulfill this promise. It was his duty as administrator to make
application to the orphans' court for authority to sell as much of
the real estate as would pay the debt. But to obtain this order it
would have been necessary to show that the personal assets were
exhausted.
In 1826, he confessed a judgment and suffered an execution to be
taken out and the property in controversy to be sold. He
remained
Page 37 U. S. 24
in the undisturbed possession of the property, enjoying the
rents and profits, and then received a conveyance of the land from
Ross on the payment of the judgment and receipting to the sheriff
for the balance of the purchase money. And prior to this time, by
his letters he informs Mrs. Swayze, who lived in Mississippi, and
still resides there, that the property left by his father would all
be consumed in the payment of debts.
In deciding the question of law raised by the exception, it may
not be proper for this Court to say whether these facts do not show
fraud in the administrator. The facts were properly before the
jury, and it was for them to determine the question of fraud. But
may Ormsby and his representatives hold the land under their deed
unless it shall be shown that Ross participated in the fraud?
A
bona fide purchaser without notice is not affected by
the fraud of his grantor, and it is admitted that a conveyance by
such purchaser to a person who may have knowledge of the fraud
would be valid. But the purchase and conveyance of Ross cannot be
considered as coming within this rule.
In the first place, Ross did not purchase with the intention of
holding the property. This was declared publicly at the sale, and
some time before it took place the same determination was made
known by him to the administrator. And in the second place it
appears the purchase was never perfected by Ross. He received the
sheriff's deed, but he paid no part of the consideration. In this
state the matter remained four years, and until the administrator
paid the judgment and receipted to the sheriff for the residue of
the purchase money. On this payment he received a deed from Ross,
and then he caused the sheriff's deed to be placed on record.
In making the purchase, Ross seems to have had no design to aid
the administrator in the perpetration of a fraud, if such were his
intention, or to defeat or embarrass the claims of the heirs of
John Ormsby, Sr. By the proceeding, he was desirous of securing the
debt placed in his hands for collection and for the payment of
which he felt himself personally responsible. The judgment and the
sale of the land secured the desired object. It might have been
secured by the judgment only.
The purchase at the sheriff's sale was not made by Ross on his
own account or for the benefit of the plaintiffs in the judgment.
Having fixed a lien on the land by the judgment and sale, he did
not desire to complete his purchase by the payment of the
money.
Page 37 U. S. 25
And it is clear that a purchaser at sheriff's sale cannot
protect himself against a prior claim of which he had no notice, or
be held a
bona fide purchaser unless he shall have paid
the money.
Had the administrator, under the circumstances of this case,
become the purchaser at the sheriff's sale, could he have held the
land as a
bona fide purchaser? His omissions of duty in
failing to account for any assets which may have come into his
possession, and his neglect to apply to the orphans' court for
authority to sell a part of the real estate to pay the debt
connected with the judgment and the proceedings under it are facts
from which a jury might, in the exercise of their judgment, have
inferred fraud.
Had the administrator fraudulently furnished an agent with money
and employed him to purchase at the sheriff's sale, could a title
thus acquired be held valid against the heirs of John Ormsby, Sr.,
though the deed might have been made to the agent? The agent may be
supposed to have been made the innocent instrument of fraud by the
administrator, and whether the title apparently remained in the
agent or had been conveyed to the administrator, could not the
fraud be inquired into at law?
There may not have been, in terms, an agreement between Ross and
the administrator that the purchase should be made at the sheriff's
sale by the former as agent of the latter. But before the sale, the
administrator was assured by Ross that he would not purchase to
hold the land, and his high character was a sufficient guarantee on
the subject; and may not this conduce somewhat to show to a jury
why the eighteen lots, and the thirty-five acres adjoining, were
sold on the execution, when the sale of two or three of the lots
would probably have satisfied the judgment? The money was paid by
the administrator.
In making the purchase, Ross seems in effect to have acted as
the agent of the administrator, and it was proper for the jury to
inquire whether the transaction was not fraudulent. If the
administrator suffered the land to be sold through the agency of
Ross with the view of securing the title to himself, to the
exclusion of the other heirs of his father, the proceeding was
fraudulent and void. And as Ross could not be considered a
bona
fide purchaser against the legal and equitable right of the
plaintiffs, he not having paid the purchase money, the deed which
he executed to Ormsby is not a
bona fide conveyance. Had
the plaintiffs brought their action against Ross, he could not have
defended himself under the sheriff's deed
Page 37 U. S. 26
without showing the payment of the consideration. Nor is this
deed a good defense against the right of the plaintiffs under the
circumstances of the case when set up by Oliver Ormsby or his
representatives. To the objection already stated to the title of
Ross may be superadded all the circumstances going to show fraud in
the administrator, and of which the jury are the proper judges.
We think, therefore, that the judge erred in charging the jury
that the deed to Ormsby was valid unless they should find that Ross
participated in the fraud, and on this ground the judgment of the
court below is
Reversed and the cause remanded for further
proceedings.
This cause came on to be heard on the transcript of the record
from the district Court of the United States for the Western
District of Pennsylvania and was argued by counsel. On
consideration whereof it is now here ordered and adjudged by this
Court that the judgment of the district court be and the same is
hereby reversed, and that this cause be and the same is hereby
remanded to the said district court with instructions to award a
venire facias de novo.
