Noonan v. Brennemann — 54 N.Y. Super. Ct. 337

Majority

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MARY NOONAN, Plaintiff, v. CHRISTIAN BRENNEMANN, Defendant.

Headnote

Wills, fee descending to heirs at law notwithstanding—Bivesting the fee and vesting it in others, what will and what will not—Unless fee conveyed, good title cannot be given.

Where a will simply directs the executor to sell the testator’s real estate, and then gives directions as to the disposition of the proceeds, among which are directions that certain portions shall be held on certain trusts, the fee descends to the heirs at law, subject to the execution of the power to sell; and, in order to give a good title, that fee must be in some way conveyed.

It may be conveyed through the execution of the power of sale, or through a deed given on a sale under a judgment in an action to foreclose a mortgage, subject to which the land descended, the heirs at law being parties to the action.

It will not be conveyed by a deed, given on such a foreclosure sale, when the heirs at law are not parties to the action.

Before Sedgwick, Cb. J., and Ingraham, J.

Decided February 14, 1887.

Exceptions by defendant, heard at General Term.

This action was brought to recover the sum of money paid by plaintiff to the defendant upon the execution of a contract for the sale to and purchase by the plaintiff

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of certain real estate, pursuant to the terms of the contract, and also to recover the expenses of examination of the title.

The question litigated was as to whether the defendant had, or had not, tendered to plaintiff a good title.

The defendant’s source of title was under a referee’s deed given to on a sale under a judgment of foreclosure and sale. The foreclosure action was brought to foreclose a mortgage made by Francis Meehin and wife to Julius L. Hitchcock. The parties to the action were Julius L. Hitchcock, plaintiff, against Margaret M, Meehin individually and as executrix of the will of Francis Meehin, deceased. Francis Meehin in his lifetime made his will which is as follows:

“ In the name of God, etc., Amen, I, Francis Meehin, of the city of New York, being of sound mind and memory, and considering the uncertainty of this life, do therefore make, ordain, publish and declare this to be my last will and testament, that is to say, I direct my executrix, hereinafter mentioned, to sell and dispose of, at public auction or private sale, all of my real and personal estate, that I may own at the time of my death, as soon as possible, and fully empower and authorize my said executrix, hereinafter named, to give good and sufficient deed or deeds therefor, and to execute all papers necessary to carry out the provisions of said sale or sales. I further direct and authorize my said executrix, hereinafter named, to pay out of the proceeds arising from said sale my funeral expenses and all other just debts, including all mortgages or liens on my real estate, assessments, taxes and other expenses, and to pay over the net proceeds arising from such sale or sales for the uses and purposes hereinafter mentioned and set forth. I give and devise the net proceeds of one half of the money arising from such sale or sales of my real and personal estate, after payment of my debts and liens thereon as aforesaid, to my beloved wife, Margaret Mary Meehin, in lieu of dower

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in my said estate, real and personal, should she elect to receive the same, to have and to hold the same forever.

“ I give and devise the other one half of the net proceeds of money arising from such sale or sales of my real and personal estate, after payment of my debts and liens thereon as aforesaid, to my beloved wife, Margaret Mary Meehin, my sole executrix, to be hereinafter appointed, and to be held by her in trust, nevertheless, for the sole benefit of my beloved grandson, John Francis Morris, with special instructions to invest the same by bond and mortgage on good and sufficient real estate in the city of New York, and the net income arising therefrom to be expended for the maintenance, support and education of my said grandson until he becomes of the age of twenty-one years; and, after my said grandson becomes of age, I direct my said executrix, or her successor in office legally appointed, to pay and to make over the whole of the net amount arising from said sale as aforesaid to my beloved grandson, John Francis Morris, and fully authorize her to execute all necessary papers for such purpose. And I hereby commit the guardianship of my said grandson, John Francis Morris, until he shall attain the age of twenty-one years, unto my said wife, my said executrix, so long as she remains my widow, and, in case of her death or remarriage, to her successor in office legally appointed. In case of the death of my said grandson, John Francis Morris, before he shall arrive at the full age of twenty-one years, I will and direct my executrix, hereinafter appointed, to invest one-half thereof for the sole benefit of my granddaughter, Mary Ann Meehin, daughter of my son, Joseph C. Meehin, and the income thereof paid for her benefit until she become of full age, when the principal sum thereof shall be paid to her by my said executrix or her successor in office.

“I will and direct that the other one half thereof shall be paid to my brother, Patrick Meehin, residing in

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Ireland, within one year after the death of my said grandson, John Francis Morris.

“ I nominate and appoint my beloved wife, Margaret Mary Meehin, sole executrix of this my last will and testament, and fully authorize and empower her with full and' ample authority to carry out the provisions of this, my. last will and testament, hereby revoking all former wills by me made.”

Before the commencement of the foreclosure action, he died leaving his said will, which was duly admitted to probate. He left, him surviving, his widow, Margaret M., a son, Joseph C., and a grandson, John Francis Morris, the son of a deceased daughter. He also left a granddaughter, Mary Ann Meehin (mentioned in said will), the daughter of said Joseph C. Meehin, and a brother, Patrick Meehin (mentioned in said will). These persons were not made parties to the foreclosure action, although they were all then living. At the time of the death of Francis Meehin, Patrick was and has since continued to be a non-resident alien. At the time of the foreclosure action, John Francis Morris and Mary Ann Meehin were infants. The widow never executed the power of sale.

The evidence established the amount of plaintiff’s damages at $809.35.

The defendant moved to dismiss the complaint, which motion was denied, and defendant excepted.

The court then directed a verdict for plaintiff for $809.35, to which direction defendant excepted. A verdict was rendered according. Defendant’s exceptions were ordered to be heard in the first instance at the General Term.

Strong & Cadwalader, attorneys, and John L. Cadwalader, of counsel for plaintiff, on the questions contained in the opinion argued:

I. The estate in the land on Meehin’s death descended to his heirs at law, the executrix under the will taking a general power of

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sale in trust and nothing more. Revised Statutes (7th ed., vol. 3, p. 2181, sec. 56); Moncrief v. Ross, 50 N. Y. R. 431; and Prentice v. Janssen, 79 Ib. 478, and cases cited.

II. Again, apart from the necessity of making the heirs at law parties in whom the fee vested, the legatees, trustees and cestuis que trust having interests in the lands before the sale proportionate to their interest in the surplus, must be made parties. The widow, individually and as executrix only, was a party.

(1.) The provisions of the will, most favorably construed for the defendant, constitute a conversion of the land into personalty and the gift of the net proceeds, subject, however, to a reconversion.

Notwithstanding the doctrine of equitable conversion, the fee is somewhere—and in the heir at law.

(2.) As to the legatees. In Forster v. Civill, 20 Hun, 282 , where a testator bequeathed nine legacies which were charged on the land, and the remainder of his property to his wife; held, that the legatees were necessary defendants in foreclosure.

III. The case of Lockman v. Reilly, 95 N. Y. R. 64, is in no respect adverse to these views. It really confirms them.

Edgar Whitlock, attorney, and of counsel for defendant, on the questions considered in the opinion, argued.—

I. The heirs at law of Francis Meehin, deceased, were not necessary parties defendant to the foreclosure suit. The terms of the will of Francis Meehin, deceased, worked an equitable conversion of the testator’s real property into personalty, out and out, or as of the time of his death, and for all the purposes of determining the rights of his heirs at law, and of the parties taking under his will, the real estate, even before any sale by the executrix, must be considered as personalty. Stagg v. Jackson, 1 N. Y. 206 ; Moncrief v. Ross, 50 Ib. 431 ; Horton v. McCoy, 47 Ib. 21; Fisher v. Banta, 66 Ib.

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468, 476, 477; Lent v. Howard, 89 Ib. 169, 177; Robert v. Corning, 89 Ib. 225, 239.

H. It.has been claimed on the part of the plaintiff, and at first blush it would seem so to be, that, as the heirs at law became seized of the legal title, and, as incident thereto, with the right of possession, they were therefore necessary parties.

This is ordinarily so because, in almost every case, the holder of the fee has an interest in the equity of redemption. It is for that reason that the heir is a necessary party defendant, and not merely because he is seized of the legal title. If a case can arise where the heir at law, while seized of the naked, legal fee, has no interest in the equity of redemption, then he will not be a necessary party defendant.

Such a case has arisen here.

Let us suppose that the heirs at law had been made parties defendant, and the suit had been in all respects regular, and resulted in a surplus, would the heirs have been entitled to take possession of said surplus moneys ?

We answer, No. The point arrived at by the testator would have been accomplished, to wit: the actual conversion of the realty into personalty, and the executrix named in the will should then have received the surplus. To hold otherwise would be not only to oppose the settled wish of the testator, but possibly to defeat his intention and the ends of justice.. No custodian of the money proceeds should be allowed other than the one he named, and yet this would happen were the above question answered in the affirmative.. What assurance would the legatees under the will ever have of getting their money, if it once passed into the hands of the heirs at law ? They could recover judgment therefor, surely, but with how little certainty of satisfying that judgment need not be described.

While the real estate remained unconverted there could be no danger from the heirs at law, because their

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hands would be tied through their lack of power to assign or transfer the title.

There is still more formidable objection to the payment of the surplus moneys to the heirs at law.

If such payment were made, it would necessarily be on the theory that the character of the realty attached to the surplus mone}', and that as the legal title and possession of the realty belonged to the heirs at law, so also the legal title and possession of the surplus moneys vested in them. But, if once paid to them, how could it ever be taken from them ? Nothing could thereafter be done by the executrix to work a conversion of it into personalty, and the result would be that the very legal doctrine which turned the surplus moneys over to the heirs at law would enable them to retain such surplus forever.

If, then, the heirs at law are not entitled to take the surplus moneys, or have any part or share therein or thereto, it follows that they could not be necessary parties defendant in the suit, because the surplus moneys represent the equity of redemption.

III. Again: If the heir at law, because of his seizin of the legal fee merely, was interested in the equity of redemption, then a judgmentrcreditor of the heir would also be interested in the equity of redemption, and so on ad infinitum. The death of the heir would still further pass the legal title, and, therefore, an interest in the equity of redemption would pass to the devisees under his will, or to his heirs at law in case of intestacy,, liable to be incumbered by their j udgment-creditors, etc.

To hold such a doctrine Avould be preposterous, and we are thus brought to the conclusion that being seized of a legal title is not in itself sufficient, but that the legal title must, in some way, be beneficial to the holder.

Now the title of the heirs at law in the case at bar was not and never could, in any event, become a bene

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ficial one, because of the equitable conversion from realty into personalty worked by the testator’s will.

Not one cent could the heirs as heirs ever have realized from the property. All the rents which might have been collected by them they must have accounted for to the executrix. Their title was not one which they could have assigned or transferred. They had no such interest in the mortgaged premises as could be protected and rendered effectual by a redemption of the mortgage. If they had procured an assignment of the mortgage they would not have been strengthened in their position; their title as heirs at law would have been no better. They would simply have occupied a two-fold position, one as heirs at law, and the other as mortgagees.

. They could not, therefore, have compelled such an assignment, and so been subrogated to the rights of the mortgagees, because their position did not entitle them to the benefit of the doctrine of subrogation; to hold that it did would be equivalent to enabling them thus to defeat the rights of the legatees under the will.

IY. The heirs at law were in no way necessary parties to any proceedings which the executrix might take for the purpose of selling the property.

As the executrix was brought in and served in the foreclosure action, the judgment and sale therein included and cut off her power of sale, and carried to the purchaser all the title which her deed would have given.

The effect of the foreclosure sale was, therefore, as extensive and as far-reaching as could have been a sale by the executrix on the .familiar principle that “ the greater includes the less.”

Therefore the foreclosure sale worked the actual conversion of realty into personalty as thoroughly as would a sale by the executrix; and. if the heirs at law were not necessary parties to a sale by the executrix, neither

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were they necessary parties to the foreclosure sale, which worked the same result.

V. The issue involved in the first objection has been passed upon in a case in which precisely the same question was involved, and the decision therein squarely sustains the contention of the defendant herein. Graham v. Livingston, 7 Hun, 11 .

It is clear that, under the will of Francis Meehin, the fee of the real estate of the testator vested in his heirs at law subject to the power of sale contained in the will. Lent v. Howard, 89 N. Y. 177 .

Before the defendant could acquire a valid title to said property in fee, he must in some way acquire the fee vested in the heirs at law of Meehin. The action to foreclose the mortgage which was a lien upon the property at the death of the testator, did not divest the heirs at law of the fee vested in them; they were not parties to that action.

The deed of the referee under the judgment in the action, conveyed the estate of the parties to the action, but did not affect the property or estate of those not parties. The legal title is still vested in the heirs at law. That the testator intended to convert the real estate into personalty, does not affect the method by which the property is to be converted. As between the executrix and the trustee and the beneficiaries, the proceeds of the land when sold would be personal and not real property; but the fee of the land vested in the heirs, and it must in some way be conveyed to the defendant to enable him to comply with his contract. That could be done by an execution of a power of sale because the fee vested in the heirs at law, was subject to the execution of that power, but such power of sale was not executed. It could also be done by the foreclosure of the mortgage; but, as a sale under the judgment in the action to foreclose would only affect the

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title of the parties to the action, in order to divest the heirs at law of the fee vested in them, they must be parties to such action.

It is unnecessary to determine what interest in the property defendant acquired by the deed from the referee in the foreclosure action. Plaintiff was not bound to accept an equitable title, and, as the fee of the premises was not vested in the defendant, his conveyance was not a compliance with the contract.

The exceptions should, therefore, be overruled, and judgment ordered for plaintiff on the verdict with costs.

Sedgwick, Ch. J., concurred.

Cases cited

Stagg v. Jackson 1 N. Y. 206 N.Y. p. 341