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JUDGMENT RENDERED WITHOUT SERVICE OF PROCESS — ACTION TO SE ASIDE. – Relief against a judgment rendered against a party without ser vice of summons is by motion in the original cause: Crocker v. Allen, 34 8. C. 452; 27 Am. St. Rep. 831, and note; note to Morrill v. Morrill, 23 Am. St. Rep. 117. And an execution issued under a void judgment is absolutely void, and may be attacked collaterally as well as directly: Olson v. Nunnally, 47 Kan. 391; 27 Am. St. Rep. 296, and note. An action may be maintained to set asido a judgmont rendered by a court which had obtained no jurisdiction from want of service of process: Magin v. Lamb, 43 Minn. 80; 19 Am. St. Rep. 216; People v. Greene, 74 Cal. 400; 5 Am. St. Rep. 448, and note; Dobbins v. McNamara, 113 Ind. 64; 3 Am. St. Rep. 626. See extended note to Oliver v. Pray, 19 Am. Doo. 603, and especially extended note to Taylor V. Lewis, 19 Am. Dec. 137.
SAOUFE V. GRIFFITHS.
(4 WASHINOTOX, 16L ) EQUITABLE TITLI TO LAND IS IN PARTY W10 Pays ACTUAL PURCHAN
PRICE WHEN. – Where ono member of a syndicate purchases land for the syndicate, and falsely represents to the other members thoroof that the purchase price is more than it actually is, and that he is paying for a proportionate interest in the land, while in fact the other members of the syndicate pay the whole price, the equitable title to the land is in
the parties who have paid the actual purchase price. Boxa FIDE PURCHASER, DOCTRINE OP, APPLICABLE TO PURCHASER OT LEGAL
TITLE ONLY. — The doctrine which protects a bona fide purchaser with out notice is applicable solely to purchasers of a legal title; the pur chaser of an equitable interest purchases at his peril, and acquires tho property burdened with every prior equity charged upon it. Where, thereforo, a party, having, at most, an equitable estate in lands the legal title to which is in a trustee for a syndicate, mortgages such lands, the
mortgage is void. ESTOPPEL – ACTUAL OWNERS OF LAND NOT ESTOPPED FROM ASSERTINO
THEIR RIGHTS WHEN. — Although a declaration of trust made and ro oorded by the members of a syndicato formed for the purchase of lands declares that a certain interest in such lands belongs to a party who has made false representations to them, yet where such declaration was made in ignorance, which was not chargeable to neglect, and the person to whom the party who made the false representations mortgaged the lands had no knowledge of the execution of the declaration, the actual owners of the lands are not estopped from asserting their rights thereto. ACTION brought by John Shoufe and Hugh McCrum, under the name of Shoufe and McCrum, against H. H. Griffiths and M. L. Abbott, doing business under the name of Abbott and Griffiths, William B. Robertson, Minda S. Graff, Hannab Kistenmacher, Alice J. Roberts, G. W. Traverse, and Thomas B. Hardin, to foreclose a mortgage on the alleged undivided two-thirds interest of Abbott and Griffiths in certain real es
tate. The mortgage was executed to George H. Bell, and by him assigned to Shoufe and McCrum. Abbott and Griffiths held a bond for a deed from John Kruinm and wife, conditioned for a conveyance of certain land for five thousand five hundred dollars, reciting that Abbott and Griffiths had paid the obligors, on the date of the bond, two thousand five hundred dollars, and that thirteen hundred dollars in money was to be paid at the time of the conveyance, and two mortgages given by Krumm as security for seventeen hundred dollars to be assumed by the grantees. The actual price was $3,550, of which $500 was paid when the bond was executed, and the balance was to be paid in cash and by the assumption of the two mortgages for $1,700, upon the execution of the deed. Abbott and Griffiths organized a syndicate for the purchase of the land, composed of the following persons: M. L. Abbott H. H. Griffithe, G. W. Traverse, and Minda S. Graff, each holding a one-fifth interest, and Alice J. Roberts and Hannab Kistenmacher jointly holding a one-fifth interest. According to the price alleged by Abbott and Griffiths, the syndicate had to contribute three thousand eight hundred dollars in cash. Alice J. Roberts and Hannah Kistenmacher jointly contributed $740, and Minda S. Graff and G. W. Traverse each contributed $740. As the actual cash required for the purchase was only $1,850, they had contributed an excess of $470, which Bum Abbott and Griffiths, who were conducting other negotiations, appropriated. Abbott and Griffiths had represented that the agreed price was $5,500, and that they were contributing $740 each, which, with $100 realized from a sale of a portion of the land and applied on the purchase price, made the sum of $3,800. The land was deeded H. H. Griffiths and Minda S. Graff, trustees. Subsequent to the conveyance, Abbott and Griffiths executed a mortgage to George H. Bell, on an undivided two fifths of said land, to secure certain notes which were assigned by Bell to Shoufe and McCrum. The superior court made a decree declaring the mortgage no lien upon the property, and finding that the title to said property is in Minda S. Graff, an undivided one third; G. W. Traverse, an undivided one third; and Alice J. Roberts and Hannah Kistenmacher, an undivided one third. The plain. tiffs appealed. Other facts appear from the opinion.
Tustin, Gearin, and Crews, for the appellants.
Scott, J. It is contended by the appellants that the land in question was sold to Abbott and Griffiths by Krumm and wife, and was by Abbott and Griffiths sold to the syndicate of which they were members. The fact that the preliminary negotiations for the purchase had been conducted by Abbott and Griffiths, and that the bond given by Krumm and wife ran to them, lends some color to this claim. But from an examination of the whole proof, as well as of the syndicate agreement itself, we are led to the conclusion that the purchase was made by the syndicate direct from Krumm and wife, and that this was the understanding of the members of the syndicate as between themselves, and was the fair intendment to be drawn from all their dealings. It clearly appears that the members of the syndicate were to engage in the enterprise upon an equal footing, according to the representations of Abbott and Griffiths, and appellants' contention that the facts in this case are not such as will warrant the granting of any relief to the respondents, Graff, Kistenmacher, Roberts, and Traverse, is untenable. The fact that the land was worth all that Abbott and Griffiths falsely represented to be the purchase price does not alter the case, for the difference between the actual purchase price paid to Krumm and wife, and the price represented by Abbott and Griffiths to have been paid or agreed upon, resulted in a direct loss to the other members of the syndicate in the proportion paid by each. They could have bought the land just that much cheaper, and their profits in case of a sale for an enhanced price would have been just that much more. It is true that the other members of the syndicate relied upon the representations of Abbott and Griffiths as to the value of the land, but they also relied upon the further fact, as they supposed and were induced to believe, that Abbott and Griffiths were substantiating their representations as to the value of this land by an investment of their own money to the same extent proportionately as that contributed by the other members of the syndicate; and it is not at all likely they would have engaged in the enterprise on the terms they did engage in it had they known the true inwardness of the transaction. While all willful, false representations resulting in loss or damage will not afford a basis for a recovery, the foundation here is sufficient. The aim of the law is to grant relief in all such cases where possible, and the law will not look with favor on a party who flippantly admits having made false representations to another, thereby
inducing him to act in a certain way, but who insists there is no remedy. There is a legal distinction, if not a moral one, between the facts of this case and of one where a party in selling a piece of property as his own to one who understands he is buying it from such party, falsely represents that he paid more than he really did pay for it. In this case these respondents were induced to pay the full purchase price for the land, and to allow Abbott and Griffiths a two-fifths interest therein by reason of the representations of Abbott and Griffiths that they were contributing a proportionately equal amount. The respondents aforesaid were induced to pay that much more for their respective interests than they otherwise would have paid. In Crater v. Binninger, 33 N. J. L. 513, 97 Am. Dec. 737, a recovery was permitted under very similar circumstances.
Appellants further contend that they stand in the position of bona fide encumbrancers without notice. This does not avail them anything. The most which the mortgage could encumber was an equitable estate in Abbott and Griffiths The doctrine which protects bona fide purchasers without notice is applicable solely to purchasers of a legal title; and the purchaser of an equitable interest purchases at his peril, and acquires the property burdened with every prior equity charged upon it: Shirras v. Caig, 7 Cranch, 34; Vattier v. Finde, 7 Pet. 252; Boone v. Chiles, 10 Pet. 177. They had notice that Griffiths and Minda S. Graff held the legal title to the land as trustees for the benefit of the syndicate.
It is further urged that these respondents are estopped from asserting their rights, in consequence of the declaration of trust made by them, which represented Abbott and Griffiths as the owners of a two-fifths interest in the land. But it seems to us that this claim is wanting in several essentials. In the first place, it appears that when this declaration was made the respondents, Graff, Kistenmacher, Roberts, and Traverse were ignorant of their rights in the premises, which ignorance was not chargeable to their neglect. While the declaration was made and recorded prior to the execution of appellants' mortgage by Abbott and Griffiths, it does not appear that Bell, the mortgagee, nor his assignees, the appellants, had any knowledge of its existence. If they had no such knowledge, they cannot well claim they were misled by its contents. The doctrine of constructive notice cannot be invoked in their favor, and, in any event, if they did know of
AM. ST. REP., VOL XXXI.- 58
it, or if such representations were made to them personally, it would be necessary for them to show that by reason thereof they were induced to take the mortgage, and there is no such proof in the record. In support of the above propositions, see Whitaker v. Williams, 20 Conn. 98; Preston v. Mann, 25 Conn. 118; Danforth v. Adams, 29 Conn. 107; Boggs v. Merced M. Co., 14 Cal. 366; Daviş v. Davis, 26 Cal. 41; 85 Am. Dec. 157; Fletcher v. Holmes, 25 Ind. 469; Long v. Anderson, 62 Ind. 537; Greensburgh etc. Turnpike Co. v. Sidener, 40 Ind. 424.
The judgment of the superior court is affirmed.
Trusts — RESULTING, WHEN ARISE. — If real property is purchased, and the conveyance is taken in the name of one person, while the purchase price is paid by another, a resulting trust arises in favor of the person paying the purchase price: Champlin v. Champlin, 136 Ill. 309; 29 Am. St. Rep. 323, and note, in which all the cases discussing this subject are collected. See extended note to Neill v. Keese, 51 Am. Dec. 751.
VENDOR AND PURCHASER - BONA FIDE PURCHASER – DOCTRINE APPLI• QABLE TO PURCHASER OF LEGAL TITLE ONLY. – A purchaser means one who has acquired the legal title: Gilpin v. Davis, 2 Bibb, 416; 5 Ann. Dec. 622 The purchaser of an equitable title takes it subject to all equities, though he purchases it bona fide, for a valuable consideration, and without notice thereof: York v. McNull, 16 Tex. 13; 67 Am. Dec, 607, and note; Polk v. Gallant, 2 Dov. & B. Eq. 395; 34 Am. Dec. 410, and note: Craig v. Leiper, 2 Yerg. 193; 24 Am. Deo. 479, and note; extended note to Walton v. Har groves, 97 Am. Deo. 433.
PRIGNON v. Daussat.
(4 WASHINGTON, 199.) DELIVERY OF DEED BY AGENT OF GRANTOR VALID WHEN. Where
deed is drawn up by the grantee, and sent to the grantor to be executed with directions to record it, the recording officer, when the deed is de. livered to him pursuant to such directions, becomes the agent of the
grantee, and such delivery gives the deed full force. CONTRACT OF MARRIAGE VALUABLE CONSIDERATION FOR DEED, AND NEED
NOT BE IN WRITING WHEN. – A contract of marriage is not only a good, but also a valuable consideration for a deed. And where a deed recites that the consideration thereof is the promise of the grantee to marry the grantor, and is drafted by the grantee, and sent to the grantor for execution, it is not necessary, in order to render the consideration sufficient, that there should be a written memorandum of the contract
of marriage signed by the grantee. DEED, VALIDITY OF, NOT AFFECTED BY ANYTHING THAT MAY HAPPEN AF.
TER ITS EXECUTION. - When a deed executed upon a good and valid consideration, the transaction is complete, and the deed will be unaf. fected by anything that may happen thereafter. Where, therefore, a grantee, at the time of the execution of a deed to her, in consideration of her promise to marry the grantor, is unaware of the intention of the