U.S. Supreme Court
Lewis v. Hawkins, 90 U.S. 23 Wall. 119 119 (1874)
Lewis v. Hawkins
90 U.S. (23 Wall.) 119
1. Where a party agrees to sell land to another and as consideration therefor the vendee gives his promissory notes payable at a future date named, and the vendor gives his bond conditioned that on the payment of the notes, he will convey the premises in fee to the vendee, but makes no deed, the legal estate remains, until the payment of the purchase money, in the vendor, and he has, by the law of those states where such liens are recognized, a "vendor's lien." The vendee has an equitable title only -- one indeed which he can sell or devise, but one which if the purchase money is unpaid, he cannot sell so as to exclude the vendor's right to have payment of it. Any purchaser from the vendee who assumes to pay the notes takes the same title that the vendee had -- that is to say, an equitable title, the land being still charged with the payment of the purchase money.
2. A discharge of such purchaser from the vendee under the Bankrupt Act, will relieve such purchaser from paying the notes, but it will not give chanroblesvirtualawlibrary
him a legal title in fee to the lands. That title, subject to the equity of the vendee or of the purchaser from him, remains in the vendor.
3. A statute of limitations barring suits for the recovery of real estate after a certain lapse of time does not apply to a case like that above described. The vendee or the purchaser from him stands in the relation of a trustee to the vendor for the unpaid purchase money, or, as the matter is looked upon in some states, stands in that of a mortgagee, against whom the statute does not run.
4. If the notes are not paid, the vendor may apply by bill in equity against the vendee and the purchaser from him, tendering a good deed, and ask that they pay the purchase money at short date or be foreclosed from setting up any right to the land, and that it be sold and the proceeds applied to paying the purchase money.
5. Where confessedly the title of a party claiming land as owner and who has agreed to sell is denied by the vendee and a dispute has taken place about title, so that a tender of a deed would be a useless ceremony, costs on a bill filed to enforce the payment of the purchase money must abide the result of the suit.
6. If the purchaser from the vendee be dead, leaving a widow his executrix, and heirs-at-law to whom with her his real estate has descended, they ought to be made parties defendant to any bill to foreclose.
The case was thus:
A statute of limitation in Arkansas, passed January 4th, 1851, [Footnote 1] enacts that no suit at law or in equity for the recovery of real estate shall be brought after the lapse of seven years from the time when the cause of action accrued.
This statute being in force, Lewis, in November, 1853, agreed to sell to Hawkins certain real estate; Hawkins, for the consideration money giving to Lewis his two promissory notes, each for the sum of $500, payable one on the 1st of February, 1855, and the other on the 1st of February, 1856, and Lewis at the same time giving to Hawkins his bond in the penal sum of $2000, binding him, Lewis, upon the payment of the two notes to Hawkins, to convey in fee simple the premises so sold.
It did not appear that this bond authorized Hawkins to take possession of the property sold, or that he did so. chanroblesvirtualawlibrary
In October, 1855, Hawkins sold and conveyed the land to one Hamiter, Hamiter, as a part of the consideration, assuming the payment of the notes which Hawkins had given to Lewis. Hamiter went into possession of the premises and occupied them with his family until May, 1866, when he died, leaving a widow and nine children his heirs-at-law, and whom, with the widow, he made his devisees, the widow being made his executrix. The widow and her family had occupied the premises ever since Hamiter's, the husband's, death.
Nothing having been paid by anyone upon the two notes, Lewis sued Hawkins, and on the 11th of August, 1860, recovered a judgment against him for $1,201. The judgment remaining also wholly unpaid, Lewis filed, in August, 1871, a bill against Hawkins and the widow and executrix of Hamiter (his children and heirs-at-law not, however, being made parties) to enforce the payment of the notes and interest against the land.
The bill alleged that the complainant had always been and still was willing to perform the agreement on his part, and offered to execute and bring into court, to be delivered to the defendants, or either of them lawfully entitled thereto, a deed conveying the land in fee simple in accordance with the condition of the title bond on being paid the purchase money due, with the interest. And alleged further that the complainant, since the second note fell due, had duly tendered to Hawkins a deed of conveyance and demanded the payment of the amount due for the purchase money thereof, but that Hawkins refused to accept the deed and to pay the purchase money.
The prayer of the bill was that the equity of redemption of the defendants, and of all persons claiming through them or either of them, might be barred and foreclosed and that the defendants be compelled to pay to the complainant the amount due to him for the land with interest, the complainant being ready and willing to execute and deliver to the defendant Hawkins, or his assigns, a deed for the land in fee simple with warranty of title, and that in case the chanroblesvirtualawlibrary
said defendants would not pay the said purchase money by a short day to be named, the premises might be sold and the proceeds applied to the payment of the decree to be rendered for the purchase money.
Both defendants answered.
The answer of Hawkins denied that any tender of a deed as alleged in the bill had been made to him, and he set up as a defense his discharge in bankruptcy.
Mrs. Hamiter, the widow, relied upon the already-mentioned statute of limitations of Arkansas, which bars suits at law and in equity for real estate after the lapse of seven years from the time the cause of action accrued.
The depositions of both Lewis and Hawkins were taken. The former stated that the tender alleged in the bill had been made, the latter that no such tender had ever been made.
The court below dismissed the bill for want of equity, and from that, its decree, Lewis, the complainant, brought the case here. chanroblesvirtualawlibrary