The President Directors and Company of the Bank of Columbia v. Hagner

THE plaintiffs instituted their suit in the Circuit Court for the county of Washington, against the defendant, on a special agreement to purchase two lots of ground in the city of Washington. The plaintiffs to support the issues joined on their part, offered in evidence certain deeds, papers and letters; the hand writing of the parties and the delivery of the letters, at their several dates, being admitted.

John Templeman, being indebted to the plaintiffs in a large amount, conveyed by deed, dated 31st March 1809, to Walter Smith, in trust to secure the debt, certain lots in the city of Washington, the two lots alleged to have been sold to the defendant included; the said trustee being authorized to sell, at public sale, the property conveyed.

On the 31st of March 1821, the bank, under seal, authorized Walter Smith to release the two lots to John Templeman, and under this authority the trustee conveyed the property to Templeman, who by deed dated 29th April 1821, conveyed the same to Peter Hagner, the defendant.

The conveyance, by Walter Smith to Templeman, and from Templeman to Mr. Hagner, were made by the direction of the bank, for the purpose of vesting a title to the two lots in Mr. Hagner, in execution of their part of the agreement upon which the suit was founded, and before the suit was commenced.

The material evidence offered by the plaintiffs to establish their claim upon Mr. Hagner, and to prove a contract made by him, for the purchase of the two lots was contained in a correspondence, &c. between General John Mason, the President of the Bank, and Mr. Hagner; commencing on the 14th May 1817, and ending on the 19th of May 1821, numbered from 1, to 11.

No. 1, dated 14th May 1817, letter, Peter Hagner to General Mason, expressed a wish to purchase the lots, if the bank was disposed to sell them, at a reasonable price-No 2, from General Mason to Mr. Hagner, dated October 16th 1817, stated, that the Board of Directors had fixed the price of the lots at twenty-five cents per square foot-No. 3, from Mr. Hagner to General Mason, dated October 17th 1817, communicated an offer of ten cents per square foot, which, by letter dated 17th December 1817, No. 4, was extended to fifteen cents per square foot-No. 5, was a memorandum sent by Mr. Hagner to General Mason, to be signed by him, and which was so done, on the 27th of April 1818; the memorandum bearing date April 25th 1818, and stating that the lots were on that day sold to Mr. Hagner, at twenty-five cents per square foot; 'payable at such periods as the bank may approve.'

On the 27th April 1818 No. 6, Mr. Hagner wrote to General Mason, desiring to have the payments for the lots purchased by him, at twenty-five cents per square foot, to meet his income; and proposed to have the same divided into six quarterly payments, the first to be made on the first day of the following October; offering his notes, and asking for a deed; or if this should not be agreed to, stating that he would bind himself to pay the money as proposed, 'and receive a bond of conveyance, conditioned to give a full title, when the money should be paid.' This letter requested a return of the memorandum, No. 5.

Upon this letter, there was written, in pencil, in the handwriting of General Mason, according to the usual practice at the sittings of the Board of Directors, 'accepted-interest on each note, as it becomes due'-No. 7, April 27th 1818, from General Mason to Mr. Hagner, enclosed the memorandum, No. 5, and mentions that his proposition would be submitted to the Board.

On the 7th October, 1818, Mr. Hagner wrote to Gen. Mason, (No. 8,) stating that he was prepared to pay the instalment falling due on the 1st October, and requesting a bond of conveyance. December 26, 1820, (No. 9, (No. 9), Mr. Hagner, by letter, states that a long time had passed since his purchase, without the title to the lots having been completed; and the bank continues without authority to convey. The bank at the time of the purchase had no authority to sell at private sale, and must have made title by a circuitous and doubtful process of a public auction, at which some one might have interposed and obtained the lot. That the bank might have held him bound to take the property, although not reciprocally bound; and that the answer of the President of the Bank, was not certain and absolute, but was referred to and made dependent on the determination of the Board of Directors. Under these, and other circumstances stated by him, he communicates his determination to relinquish the purchase.

On the 8th May 1821, Mr. Hagner notifies General Mason, (No. 10,) that he considers his agreement to purchase the lots void, and that he has no claim or title to them. In reply to this letter, upon the 19th May 1821, (No. 11,) Gen. Mason says:--

'You will no doubt, Sir, recollect a conversation I had with you soon after the reception of your letter of the 26th December last, when I informed you that that letter had been submitted to the Board of Directors, and that it had been determined that the purchase by you of the lots in question being considered in all respects a firm and bona fide purchase, it would not be relinquished, and that measures would be taken to make you a title valid in law. I am now instructed to inform you that those measures have been taken-that deeds to that effect have been made by the proper parties, which are expected to be soon received here, when they will be tendered you, and a compliance with your part of the contract expected.'

Evidence was also given, on the part of the plaintiffs, to prove the entire insolvency of John Templeman, and the non-payment by him of any part of his debt to the plaintiffs. That on the 28th September 1821, a tender of the deeds already mentioned was made by an officer of the bank to the defendant, who refused to accept them. The deed of Templeman to Hagner, dated 3d of April 1821, was recorded by the consent without dated 3d of April 1821, was recorded by the consent without prejudice.

A witness also proved, that in the month of June 1818, he was employed by defendant to enclose the two lots in question, and did enclose them with a board fence: that before enclosing the said lots, an old house was pulled down by order of the defendant, and some part of the materials used in making the said enclosure; that some time afterwards, the witness was employed by defendant to pull down the fence, which was done, and the lots left open; that the said house was a small frame house, very old, and in bad repair; that it had been inhabited some time before, but was not in tenantable order and condition; that if the house had been put in good repair, which would have cost half as much as building a new house of the same size and kind, it would have rented for about three dollars per month.

The clerk of the Circuit Court of the District of Columbia certified that there was no judgment in force on the 30th day of March 1821 against John Templeman, and proof was also made that the taxes on the two lots of ground from 1809 to 1821 inclusive, had been assessed to, and paid by the Bank of Columbia.

On the 19th of May 1821, the situation of the lots was examined by order of the President of the bank, and it was found 'that the fence had been removed apparently that spring, and the lots appeared to have been cultivated the fall before.'

Upon this evidence the defendant, by his counsel, prayed the Court to instruct that jury, that upon the evidence, so given on the part of the plaintiffs, though found by the jury to be true as above stated, the plaintiffs are not entitled to recover in this action the purchase money for the lots in the declaration mentioned; which instruction the Court gave as prayed.

The plaintiffs prayed the Court to instruct the jury, that upon the evidence the plaintiffs were entitled to recover such damages, as the jury should think the plaintiffs had sustained by the defendant refusing to comply with the contract stated in the declaration, if they should believe from the said evidence that the defendant consented to the delay on the part of the plaintiffs to make a deed, or give a bond of conveyance for the lots mentioned in the declaration; which instruction the Court refused to give.

A bill of exception was then tendered, by the counsel of the plaintiffs, to the instructions given by the Court on the prayers of the counsel for the defendant, and also to their refusal by the Court to give the instructions to the jury prayed for by the counsel for the plaintiffs.

While the bill of exceptions was preparing, the following additional evidence was discovered by the plaintiffs, and was offered and read to the jury:--

A deed, commissioners to J. Templeman 19th September 1801. Liber G. fol. 490.

A deed, Templeman & Stoddart to Bank of Columbia, 19th January 1802. H. 386.

A deed, Stoddart to Templeman, 25th September 1804. M. No. 12, 151.

A deed, Templeman to Bank of Columbia, 7th March 1807, No. 18, 346.

The deed of 7th March, 1807, conveyed inter alia to the plaintiffs the two lots alleged to have been sold by Mr. Hagner, and authorized the bank to sell the property vested in them by private or public sale.

This evidence being exhibited, the Court adhered to the instructions and opinions given to the jury, and an additional exception was taken thereto by the counsel for the plaintiffs, and a writ of error was prosecuted to this Court.

For the plaintiffs in error it was contended, that upon the evidence, the plaintiffs were entitled to recover, and that the Circuit Court ought to have so instructed the jury.

Mr. Key for the plaintiffs.

1. A contract for the purchase and sale of the two lots of ground was made between Mr. Hagner and the Bank of Columbia, the President of the bank having full authority from the Board of Directors to conclude the same. That the defendant had no evidence of the authority of the President to make the contract was his own neglect, and he dealt with him as the agent of the bank, and under the contract took possession of the property.

By the contract the defendant was to pay for the lots, according to his proposition in the letter of the 27th April 1817, and the acceptance 'noted in pencil' is the agreement in writing by the bank to the terms proposed, of which, sufficient evidence exists, in addition to the circumstances of the defendant's entry on the lots, showing that he knew of the agreement of the bank.

2. The contract subsisted down to the period of the defendant's refusal to fulfil it.

It subsisted on the 7th October 1818, as shown by his letter referring to his propositions of payment upon the 27th April 1817; by his remaining in possession, and this continued until January 1820, when all the payments became due, no application having been made to complete the title, although it may be inferred that he knew some measures would be required for the purpose. The acquiescence of the defendant in the delay, bound him during its existence.

3. When on the 26th December 1820, he communicated his determination to withdraw from the contract, he had no such privilege. He was bound to wait, if the title was not incurably bad, a reasonable time until it should be completed. Sugden, 252-3-4-5. If aware of the difficulties in the title arising from the sale made under the deed of trust by Walter Smith, by which a public and not a private sale of the lots was to be made, he should have tendered performance on his part and demanded performance of the vendors. Instead of this, if by that letter he intended to renounce at once, this could not be done, legally, unless in the case of an incurably bad title. The formal relinquishment is made on the 8th of May 1821, and this being the first complaint of non-performance by the bank, it was promptly attended to. Cited Sugden on Vendors, 157. 249-50-51-52-34, 35. The refusal on the part of the defendant made a tender of performance by the plaintiffs, previous to a bill of specific performance on this action; unnecessary. Sugden, 162, 163. 3 Douglass, 684. But no such tender was necessary. Sugden on Vendors, 160, 164.

The bank did offer a good title, as is shown by the evidence. Templeman had no ultimate interest; it was released, and his deed made with the consent of the bank, gave a good title. Those who are entitled to the money, which may arise from the sale of an estate are the substantial owners of it. Sugden, 300. To sustain this suit, it is sufficient if a good title can now be made, and this can be done under the deed of 7th March, 1807. Sugden, 250-1.

Mr. Jones for the defendant.

1. There never was a complete contract entered into by Mr. Hagner. He made propositions, and they were never full accepted by the bank; nor was he at any time informed of the order or determination of the bank thereon. It was the duty of the plaintiffs, when the money became due, to have tendered a performance of their contract, and not to have postponed the same until September, 1821, the day before the action was instituted.

No purchaser is bound to take an equitable title, and in this case the bank had not a legal title under the conveyance to Walter Smith, under which the title tendered was derived. The title must be complete at the time of performance of the contract. Sugden on Vendors, 158.

When the original security is in form of a trust, it must remain so until the trust is executed, by a sale of the property in the time prescribed.

A Court of Equity would not have confirmed the title to the defendant, they would have said to the trustee Walter Smith, go and execute your trust.

As to the title of the 28th of September 1821, tendered to the defendant, it was not a valid title. By the law of Maryland, no land can be conveyed by a power of attorney; it was not made by the bank, and it passed through Templeman, who was insolvent. The defendant could not be compelled to accept such a title. There is no authority to be found by which a vendor can call on another to complete a title which he contracted to give.

Entry on the property does not furnish any thing but a presumption, that a title would be made; and this was never done.

As to the time which will be allowed for completing a title, the following cases were cited. Sugden on Vend. 284. 1 Marshall, 583. 6 Taunt. 259. 5 East, 198. 1 Smith's Rep. 390.

The plaintiffs after the case had gone to the jury, exhibited a new title. The first was as a creditor, and the conveyance was to be derived from the trustee; the second title was under an old deed, by which the bank was authorized to convey. The deed of 1807 was controlled or revoked by the subsequent deed; and notwithstanding that deed, the trustee alone could make the sale. 1 Marshall, 285. 5 Taunt. 282, 3 ''Bos. & Pull.'' 181.

Mr. Justice THOMPSON delivered the opinion of the Court.--