U.S. Supreme Court
Fisher v. Shropshire, 147 U.S. 133 (1893)
Fisher v. Shropshire
Argued November 22, 1892.
Decided January 3, 1893
147 U.S. 133
The courts of the United States enforce grantor's and vendor's liens, if in harmony with the jurisprudence of the state in which the action is brought.
The doctrine of a vendor's lien, arising by implication, seems to have been generally recognized in the State of Iowa. chanroblesvirtualawlibrary
If a suit to enforce a vendor's lien upon land in Iowa is pending at the time when the vendee conveys the land to a third party, no presumption can arise that that lien has been waived, as against the grantee of the vendee, whatever may be the general rule in that state as to the presumption of the waiver of a vendor's lien, in case of a conveyance of the tract by the vendee.
The filing of the petition in this case to assert and enforce a vendor's lien was notice of its assertion, and prevented third parties from acquiring an interest in the subject matter against and superior to the lien.
It does not appear to be necessary in Iowa to exhaust the remedy at law before proceeding to enforce a vendor's lien.
Under the circumstances of this case, as detailed in the opinion, held,
(1) That a vendor's lieu existed on the property for the complainants' benefit which could be enforced by them for the balance due them on the purchase money.
(2) That George Lyle was not a necessary party to the proceedings to enforce it.
(3) That there was an error in the master's computation which made it necessary to remand the case.
In 1876, Mrs. Loretta Shropshire owned in her own right five hundred and forty acres of land in Iowa, derived from the estate of a former husband, forty acres of which constituted her homestead. May 1, 1877, she borrowed from the German Savings Bank of Davenport, Iowa, $10,000 for three years, with interest at the rate of ten percent per annum, payable semiannually, and she and her husband, Alexander C. Shropshire, executed a mortgage on the five hundred and forty acres. Judgments were rendered against her for various sums, and her brother, Alexander Rhinehart, became her surety upon a bond for a stay of execution. The stay having expired, all the real estate of Mrs. Shropshire, except her homestead, was held for sale, subject to the prior mortgage of the bank.
The statute of Iowa provides that "in no action where the defendant has . . . stayed execution on the judgment shall he be entitled to redeem." McClain's Ann.Code § 4331. In February, 1878, Mrs. Shropshire applied for assistance to John Lyle, and it was arranged between her brothers, Alexander K. and Jehu Rhinehart, and herself, that Jehu Rhinehart should bid in the property at the sheriff's sale, and, if she chanroblesvirtualawlibrary
succeeded in raising the amount of the judgment, that he should deed the land to her or to whomsoever she might direct. Lyle thereupon advanced to Mrs. Shropshire $4,250, and Jehu Rhinehart executed to him a quitclaim deed, dated March 28, 1878, for five hundred acres of the land purchased at the sheriff's sale, for the expressed consideration of forty-two hundred and fifty dollars, and Mrs. Shropshire and her husband executed to Lyle a quitclaim deed for the forty acres of land constituting the homestead tract dated March 20, 1878, and expressing a consideration of one thousand dollars.
May 1, 1878, Mrs. Shropshire and her husband executed to Lyle a quitclaim deed of the entire tract, the consideration named being fourteen thousand two hundred and fifty dollars, Lyle purchased and took an assignment of the German Savings Bank mortgage. Mr. and Mrs. Shropshire continued in the possession of all the lands deeded to Lyle until January 1, 1881, when the property was surrendered to him, and he and those claiming under him have continued in possession from thence hitherto.
The original bill in this case was filed by Mrs. Shropshire February 26, 1883, in the District Court of Jasper County, Iowa, in which county the lands were situated, against John Lyle as sole defendant. On March 1, 1883, Lyle conveyed the lands to his grandson, George Lyle, and he took possession on the next day. The cause was then removed to the Circuit Court of the United States for the Southern District of Iowa, on September 14, 1883, on the application of John Lyle, upon the ground that he was a citizen of the State of Illinois, and the plaintiff, Mrs. Shropshire, was a citizen of Iowa. The bill was amended January 15, 1886, by making A. C. Shropshire, the husband, a party complainant, and on August 27 of that year, the bill was further amended. The bill, as amended, in substance alleged that the advancement by John Lyle of $4,250 was a loan; that the quitclaim deeds of Rhinehart, Mrs. Shropshire, and her husband were intended simply as mortgages to secure the amount of the loan; that upon that loan and the German Savings Bank mortgage various payments had been made; that John Lyle, being the holder of the quitclaim chanroblesvirtualawlibrary
deeds and the savings bank mortgage, bought the lands in question of Mrs. Shropshire at the price of $42.50 per acre, and took possession of the same about January 1, 1881, and that there was a large amount of the purchase price still due, which defendant had neglected and refused to pay. The bill prayed that an account be taken of the amount due complainants, that the defendant be decreed to pay the balance due upon the purchase price of the land, and that a vendor's lien be established therefor, and for general relief.
The defendant answered under oath, denying all the material averments of the bill and insisting upon the deeds as absolute conveyances, and alleged that in 1882 he sold, and in 1883 conveyed, the lands in question to one George Lyle, and that the deed was delivered and recorded before this suit was brought. Defendant also averred that Mrs. Shropshire was largely indebted to him, and that upon a final settlement, January 27, 1880, a balance of $7,900 had been found due to him from her. He further declared it to be wholly false and without color of truth that he purchased the farm from Mrs. Shropshire January 1, 1881 at $42.50 per acre or at any other sum or price, and that the alleged sale was "without any basis of fact whatever."
Defendant also moved the court to dismiss the bill for defect of parties, in that George Lyle had not been made a party defendant, which motion was overruled.
An interlocutory decree was entered November 11, 1886, determining that the deeds from the complainants to the defendant were mortgages, and that on or about January 1, 1881, defendant John Lyle had agreed to take the lands and pay therefor $21,600. A special master was appointed to take and state all the accounts between the parties, and in December, 1886, he filed his report showing a balance due Mrs. Shropshire upon the purchase of the land in the sum of $7,807.31, or, in another view, of $2,028.51, with interest from January 1, 1881. The accounts thus stated in the alternative were arrived at by charging Lyle with the $21,600 and crediting him with an alleged individual i881. The accounts thus stated in the alternative were arrived at by charging Lyle with the $21,600 and crediting him with an alleged individual i881. The accounts thus stated in the alternative were arrived at by charging Lyle with the $21,600 and crediting him with an alleged individual indebtedness of Mrs. Shropshire, as well as the joint indebtedness of husband and wife, amounting chanroblesvirtualawlibrary
together to $18,687.13, and deducting $4,894.44 payments, leaving $7,807.31; but the master reported that if the court should be of opinion that certain sums, which he enumerated and described as "individual indebtedness" of A. C. Shropshire amounting in the aggregate to $5,778.80, should also be deducted, then the balance due was but $2,028.51.
May 28, 1887, a final decree was entered confirming the master's report, and decreeing the payment of the sum of $10,810.46, with interest at six percent from that date, establishing a vendor's lien against all the lands above referred to, and directing a sale on default of payment. From this decree the pending appeal was prosecuted. The opinion of the circuit court is reported in 31 F.6d 4. chanroblesvirtualawlibrary