US SUPREME COURT DECISIONS

SEYMOUR V. FREER, 75 U. S. 202 (1868)

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U.S. Supreme Court

Seymour v. Freer, 75 U.S. 8 Wall. 202 202 (1868)

Seymour v. Freer

75 U.S. (8 Wall.) 202

Syllabus

1. In May, 1835, an agreement was entered into between Price and Seymour which provided on the part of Price that be should devote his time and best judgment to the selection and purchase of land to an amount not exceeding five thousand dollars in certain designated states and territories or in such of them as he might find most advantageous to the interest of Seymour; that the purchases should be made during the then existing year, and that the contracts of purchase should be made, and the conveyances taken in the name of Seymour; and on the part of Seymour that he should furnish the five thousand dollars; that the lands purchased should be sold within five years afterwards, and that of the profits made by such purchase and sale, one-half should be paid to Price and be in full for his services and expenses. Under this agreement, lands having been purchased by Price and the title taken in the name of Seymour.

Held:

i. That Seymour took the legal title in trust for the purposes specified -- that is, to sell the property within the time limited, and, after deducting from the proceeds the outlay, with interest and taxes, to pay over to Price one-half of the residue, and that, to this extent, Seymour was a trustee, and Price the cestui que trust.

ii. That the trust continued after the expiration of the five years, unless Price subsequently relinquished his claim, the burden of proof as to such relinquishment resting with the heirs of Seymour.

iii. That the principle of equitable conversion being applied to the case, and the land which was to be converted into money, being regarded and treated in equity as money, the personal representative of Price was the proper person to maintain this suit, and it was not necessary that his heirs-at-law should be parties.

2. The statute of limitations has no application to an express trust where there is no disclaimer.

On the 9th of May, 1835, Henry Seymour, residing at Utica, New York, and Jeremiah Price residing at Chicago, Illinois, entered in New York, into a contract, thus:

"The said Price agrees that he will forthwith devote his time and attention, and exercise his best judgment, in exploring and purchasing land, to an amount not exceeding $5,000, in the States of Illinois, Indiana, and Ohio, and in the Territories of Michigan and Wisconsin, or in such of them as he may find most

Page 75 U. S. 203

advantageous to the interest of said Seymour, in whose name the contracts and conveyances shall be made and taken. The purchases shall be made after full and careful searches and explorations, for the most profitable investments, on or near the sites or expectant sites of towns or places of business, and, in general, in tracts of ground of moderate extent; and the said Seymour covenants, on his part, to furnish $5,000 for the above contemplated purchases, and that the lands, purchased as aforesaid, shall be sold within five years from the present time and out of the profit which may be made by such purchase and sale (after charging to the investment, the taxes and other charges, if any, together with 7 percent interest on the investment and the charges last mentioned), there shall be paid to the said Price one-half of the same, which one-half of the profit shall be in full of his services and expenses of every kind in making the aforesaid explorations, searches, and in doing all such other things as may be requisite and proper in making the contemplated purchases. It is understood that the purchases shall be made during the present year, and that no payment for services or expenses will be made by said Seymour, except from the profits made as aforesaid."

Contemporaneously with the making of the contract, Seymour placed into the hands of Price the $5,000 mentioned in it. And between June and October, 1835, Price bought about thirty pieces of land in Illinois, thus using all the money.

The lands were unproductive, and consisted, in their sundry parcels, of two thousand four hundred and forty acres and some village lots, situate in Joliet. It was all conveyed to Seymour.

In August, 1837, Seymour died; he left two sons, viz., Horatio and John F., and four daughters, two of them being, at his death, and at the expiration of the five years mentioned in the contract, infants. By his will, he appointed Horatio, John F., and another, his executors, and his real estate, under the directions of his will, went to his heirs, except the share of one daughter, which was vested in trustees.

No part of the land was sold during the five years specified in the contract. It was admitted of record that, at the expiration of the time for sale, stated in the contract (May, chanrobles.com-red

Page 75 U. S. 204

1840), the lands were unsalable, and that it was entirely uncertain how much they could have been sold for, or whether they would ever have brought enough to repay the original investment and interest.

During the five years, there were no taxes upon, or expenses as to the lands purchased, except taxes upon the lots in Joliet, amounting, in all, to $19.33. These were paid by Price with money furnished by Seymour. Subsequently to the five years, Price till his own death, in 1854, paid the taxes on the lands; Seymour's executors furnishing him the money to pay them, as also to pay any small expenses he was put to.

The accounts of Price (independently of the outlay for the purchase, and in which all the taxes and expenses just spoken of were entered), began March 4, 1837. They were headed:

"Account of payments on account of H. Seymour."

They began 24 December, 1841, comprised eighty-four items amounting to $2,054, and ran to near the date of Price's death in July, 1854, terminating 16th June, 1854. The items were chiefly of taxes on the different pieces of property. But there were several charges for postage on letters, for a small item of traveling expense in paying taxes, for interest on small sums advanced to pay taxes &c., and one in March, 1845, of $1.53 paid as a charge for advertising a county tax, "because," said the account, "funds not sent." But there was no charge or claim for services by Price or any other person as agent. In fact, in one or more instances he apparently suffered lands to be sold for taxes. At the date of Price's death all Price's charges for taxes paid and for these small outlays had been settled, Seymour's executors having sent him, from time to time, and apparently as informed of them, checks for the sums due. Between December, 1841, and Price's death in July, 1854, the executors had thus sent him about sixteen different checks.

Price as already said, died in July, 1854, in Illinois. John High became his administrator. High now looked chanrobles.com-red

Page 75 U. S. 205

after the lands; under what exact source of interest was a matter disputed. His accounts of money received and of lands sold were thus headed:

"Account of money received from heirs and devisees of Henry Seymour, deceased (after his decease and after decease of Jeremiah Price), by John High, Jr., as agent for heirs and devisees, to pay taxes and other expenses on lands aforesaid."

"Account of sales made by John High, Jr., as agent for estate, heirs and devisees of Henry Seymour, deceased, from lands purchased by Jeremiah Price deceased."

In 1855 and 1856, High negotiated sales of portions of the land, which were consummated by contracts executed by the heirs and the purchasers. The sales were profitable. Two hundred acres were sold for $69,200; and High now, as administrator of Price alleging that the original outlays, costs, and interest had been repaid, claimed one-half the surplus; contending that he was entitled to it under the contract of 1835. The representatives of Seymour not being of this opinion, High (who dying in the course of the suit was succeeded by Freer), now, February, 1857, filed a bill in the court below against all the executors of Seymour, his heirs-at-law, and the trustees of the cestui que trust's daughter.

The bill set out the contract, stated that no sales had been made within the five years, and that Price had not insisted on their being so made, because it was thought that the interest of all parties would be promoted by holding on for better times, but that nothing was done to release Seymour or his representatives from their original obligations; that High, after Price's death, had acted at agent of Seymour's representatives, and effected sales; and that the original $5,000, interest &c., being all refunded, and the surplus being clear profits, he, High, as administrator, claimed one-half of it for the estate of Price and that he had always been and was now ready to agree upon and define the relative rights of the two estates, and divide the profits, but that chanrobles.com-red

Page 75 U. S. 206

in consequence of the number of the parties interested, on Mr. Seymour's part, the distance of their residence from the subject matter, the death of the original party, and the intervention of descents, marriages &c., and from the refusal of several of the parties so in interest to admit Price's rights, he was afraid that in case the residue of the lands should be sold out, and the whole converted into money and be allowed to go into the hands of Seymour's representatives, he would, owing to their number and to the fact of their residence being without the jurisdiction of the courts of the state where the whole profits had been made, lose Price's share; on which account as he conceived the interposition of a court of equity was necessary. Price's heirs were not made parties to the bill.

The answer, admitting the agreement, purchase, and advance of money, stated that the lands were situated near Price's residence and being wild required no particular care; that during the five years Price did nothing except what was required of him by his agreement; that at the death of Seymour one of the defendants was a married woman, and two others were infants. It denied that the omission to sell during the five years was for the benefit of the defendants, but averred, on the contrary, that both Seymour, in his lifetime, and the defendants, afterwards, had at all times been anxious to sell if they could do so without loss. It denied that Price did not waive a right to have the property sold within five years, but averred, on the contrary, that he did. It averred moreover that Price always treated the defendants as the sole owners, and solely entitled to the proceeds, and never pretended to have any interest; that he refused to pay the taxes or any portion of them, "but claimed that he ought to be allowed a reasonable compensation for his services as agent, and not under the contract;" that the defendants had always been willing to allow him such compensation. It set up further that by the legal effect of the agreement Price's interest was to be half the profits to be got upon a sale to be made in five years, and averred that no profits on sales could be made or were made within chanrobles.com-red

Page 75 U. S. 207

that time, and averred that the defendants had in no way continued or extended the agreement with Price.

As to any claim for a breach of the agreement in not selling in five years, the answer pleaded the statute of limitations.

As to the agency and the expenditures of High, it stated that after the death of Price he, High, was requested by Horatio and John F. Seymour to find purchasers for the land if he could, but that he had no other power respecting the lands; that the contracts for the parcels sold were executed by the defendants and not by High; that the negotiations for such sales were made by the defendants through High, and were subject to the ratification of the defendants, and that High was not employed in consequence of any relationship which he had to Price or to his estate, or on account of the agreement between Henry Seymour and Price.

Finally, it denied that any cause existed for the interposition of a court of equity, submitted that the defendants were improperly joined, for the want of a common interest among them, and asserted that no receiver was wanted, the devisees of Seymour being all well known as citizens of New York, and fully competent to dispose of the lands without the aid of a receiver, and not wanting in ability to refund &c.

General replications were filed. No proofs were taken, nor did it appear from the evidence, that any letters from either side were called for or produced. Certain facts were admitted.

An interlocutory decree making a reference to a master adjudged that Price by virtue of the agreement of 1835, was "entitled, as an equal co-partner" in the property to one equal half of the net profits made, or to be made from the sales; that the lands having been purchased by Price as an "adventure or investment on joint account of himself and said Seymour," the sales already made and the sales yet to be made were to be deemed and taken as made, and to be made "on joint account" of the estates of Seymour and Price.

The final decree recited the former decree and a master's chanrobles.com-red

Page 75 U. S. 208

report made to enable the court to administer the property on "just partnership principles," and, after making a disposition of the proceeds of sales of the lands, it provided that

"the balance which shall remain thereof being clear profits of the partnership land purchase and sale up to the present time, be equally divided between the parties in this suit: one-half to the complainant, and the other half to be held by the heirs and devisees of Henry Seymour, deceased."

And it spoke of "closing and selling the partnership accounts so far as the sales and collections have progressed."

The solicitor of the complainants, by consent of parties, was appointed receiver, with an agreement that he might sell at private sale.

The representatives of Seymour brought the case by appeal here. chanrobles.com-red

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