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Deeds - Exceptions And Reservations - Use Of Extrinsic Evidence To Interpret Uncertain Exceptions - Exception To Grant Described In Document To Be Drawn, Michigan Law Review

Michigan Law Review

In anticipation of becoming the owner of a tract of land, S agreed to convey to a water company that portion of the land which the company would require for its reservoir. On acquiring the land, S conveyed the tract to F "except about 25/100 acres on the westerly side to be deeded to the Centralia Water Works Co." Ten days later, S conveyed to the water company "all that part . . . that is now or shall hereafter be, covered by water in the reservoir of said . . . company to high water mark in flood time …

Landlord And Tenant - Necessity For Consideration For Lease, James A. Lee

Michigan Law Review

In an action to cancel a five-year lease, it appeared that the lessee had agreed to pay as rent an amount equal to one cent a gallon on each gallon of gasoline delivered, by it, on the leased premises. Held, that the lease was valid, as it created a bilateral contract supported by consideration on both sides, since according to the court's construction of the lease the lessee had impliedly promised to use the premises as an automobile filling and service station for the stipulated period and so would necessarily be required to deliver gasoline there. Jackson v. Pepper …

Taxation - Federal Estate Tax - Transfers In Which Decedent Had Reserved A Contingent Reversionary Interest - St. Louis Union Trust Cases Overruled, Robert M. Warren

Michigan Law Review

In 1919 decedent transferred property in irrevocable trust, income to be paid to X for life and on X's death, the corpus and accumulated income to be returned to the settlor, if he should then be living; but if he should then be dead, remainder to Y. The settlor predeceased the life beneficiary and the commissioner included the trust property in decedent's gross estate under section 302 (c) of the federal estate tax. The board of tax appeals reversed this determination, and the board was upheld by the United States Circuit Court of Appeals for the Sixth Circuit, …

Deeds - Construction Where Grantees Take "Jointly'', Michigan Law Review

Michigan Law Review

Land was conveyed to plaintiffs' ancestor and defendant by deed. The granting clause read: "hereby convey to Isaac . . . and Alice . . . "; the habendum clause: "Said real estate being taken by said grantees jointly . . . to have and to hold . . . to the said grantees, their assigns, heirs, and devisees forever." The heirs of Isaac, who died intestate, filed a partition petition; Alice, claiming as surviving joint tenant, answered and also started an action to quiet title. A statute provided that "Conveyances to two or more in their own right create …

Trusts - Right Of Trustee's Wife To Dower In Property Held Subject To Oral Trust - Effect Of Subsequent Memorandum - Dower Where Trustee Has Both Legal And Equitable Interest, Michigan Law Review

Michigan Law Review

Pursuant to an oral agreement and upon consideration furnished by them, A, B, and C procured land to be conveyed to A by a third party. Six days later A executed a self declaration of trust in the terms of the oral agreement; that he would operate it, and within a specified period sell the property and divide the proceeds between himself, B and C, as beneficiaries. A suit to remove A as trustee culminated in a judicial sale of the property to B and C. In this proceeding by B and C to quiet title, A …

Adverse Possession - Severance Of Minerals And Surface - Adverse Possession As Affecting Title To The Minerals, John M. Ulman

Michigan Law Review

The land in question was set aside by the state for school purposes. For some time prior to 1881 one Bailey had been in possession. At that time he and his children, to whom he had deeded parts of the land, conveyed the mineral interests to a grantee from whom plaintiff claims. At the time of the conveyance the evidence was insufficient to show title by adverse possession in Bailey. Bailey and his grantees, from whom defendant claims, remained in possession until this action was brought. The limitation ceased running against the state by an act of the legislature at …

Vendor And Purchaser - Right Of Vendor's Assignee To Specific Performance Where Contract Calls For Warranty Deed, Daniel Hodgman

Michigan Law Review

Vendor, a corporation, contracted to convey real estate to the vendee "by good and sufficient warranty deed, free of all incumbrances" upon payment of the purchase price by the vendee. The vendor assigned the contract to X as trustee and then went into receivership and liquidation. A new corporation was organized and the real estate subject to the contract was conveyed to it by the old corporation (vendor). The contract was then assigned to the new corporation by X, the trustee. The vendee being in default, the new corporation as assignee of the vendor sued the vendee for specific …

Purchaser's Remedies For Absence Of Marketable Title, Lawrence Linville

Michigan Law Review

"Where a person takes upon himself to contract for the sale of an estate, and is not the absolute owner of it, nor has it in his power by the ordinary course of law or equity to make himself so; though the owner offer to make the seller a title, yet equity will not force the buyer to take it, for every seller ought to be a bona fide contractor: and it would lead to infinite mischief if one man were permitted to speculate upon the sale of another's estate."

The apprehensions of Sugden were not groundless, as three quarters …

Principal And Agent - Liability Of Agent To Third Party For Contract Made Without Authority, Walter Probst Jr.

Michigan Law Review

The defendant conducted a real estate agency and had been requested from time to time to find a purchaser for a certain tract of land. The defendant negotiated to sell this land to the plaintiffs, who knew the defendant was acting as an agent. The land had before the time of this negotiation been conveyed to a third party by the principal. It was found that the defendant was acting in good faith. Held, that the defendant was not personally liable for the loss and damage sustained by the plaintiffs. King v. Russell, 278 Mich. 529, 270 N. …

Wills - Executors And Administrators -Titles - Effect Of The Revocation Of Probate Decrees On The Title To Realty Acquired By Bona Fide Purchase From Heir Or Devisee, Victor P. Kayser

Michigan Law Review

There are probably few chains of title to realty that do not contain at least one link consisting of a conveyance from one who claimed as heir or devisee of a decedent. The ability of the granter to convey resulted from the fact that he was heir of an intestate or was a devisee under the last will of his testator. Sometimes it has occurred that the grantee has purchased for value and with no knowledge or suspicion of an impending attack on his grantor's title, only to have it subsequently determined in a judicial proceeding that his grantor's ancestor …

Mortgages - Deed In Lieu Of Foreclosure - Validity, Elbridge D. Phelps

Michigan Law Review

Depression years have brought to the fore a question much controverted in the early law, but now said to have become settled. That question regards the effect and efficacy of a conveyance of the mortgaged land, or a transfer of the equity of redemption, by the mortgagor to his mortgagee. It seems to have been cheerfully assumed by some lawyers, and by laymen in general, that in the absence of liens subsequent to the mortgage, the procedure is perfectly safe and proper in every case. It is the purpose of this discussion, however, to point out certain dangers inherent in …

Mortgages - Subrogation Of One Whose Loan Is Used To Pay A Senior Mortgage, Theodore R. Vogt

Michigan Law Review

S mortgaged the property in question to U, then conveyed the land and certain water rights to H, who gave a second mortgage on the land to M. Thereafter H conveyed the land and water rights to F, who borrowed from Z funds to retire the first mortgage, giving to Z a mortgage which it was agreed between F and Z should be a first mortgage, and transferring to Z the water rights as additional security. In an action by M to foreclose, held, Z was entitled to subrogation to the position of first mortgagee …

Specific Performance--Damages--Action At Law By Vendor Of Land For The Full Purchase Price

Michigan Law Review

In an action at law by a vendor of land for breach of contract by the purchaser, the title not having passed, the traditional measure of damages is the difference between the contract price and the value of the land at the time the vendor's conveyance was due. But where a conveyance is not yet due from the vendor a majority of jurisdictions allow recovery of all but the last installment of the purchase money, on the ground that in that case the promise to pay is independent of the vendor's promise to convey. Even where a conveyance is due …

Trusts - Constructive Trusts - Breach Of Fiduciary Relation Between Husband And Wife With Respect To Oral Agreement Concerning Land

Michigan Law Review

In her last illness, Mrs. Jackson desired to transfer realty to her married daughter, plaintiff herein. To prevent creditors of the daughter's husband from reaching the property, Mrs. Jackson conveyed the land to her husband, Mr. Jackson, with the parol understanding that "he would see that Cora got it." Jackson failed to transfer the land and upon his death it passed under an ante-nuptial settlement to defendant, his second wife. In an action to recover the land, the court stated that defendant was in the position of a bona fide purchaser for value, and held that the statute of frauds …

Equity - Rescission Of Contract Induced By Fraud - Money Judgment As An Alternative To Specific Restitution

Michigan Law Review

Plaintiff entered into an agreement for the exchange of interests in real estate with one of the defendants. After payment of part of the boot money agreed upon, the plaintiff defaulted and sued to have the agreement rescinded for fraud. The trial court rendered a money judgment for the amount at which the plaintiff's property had been taken on the trade. Held, that defendant's wife, to whom the property had been conveyed, should have been joined, and that the decree should be modified to order a reconveyance to the plaintiff. Bacon v. Fox, 267 Mich. 589, 255 N. …

Deeds-Instrument In Form Of Contract For Sale Of Land As Gift

Michigan Law Review

Decedent executed and delivered to his sister, the petitioner, in a sealed envelope an instrument in the form of an executory contract for the sale of land by the terms of which the decedent promised to convey to the petitioner his undivided two-thirds interest in a certain building and lot. The execution of the instrument was not the result of any agreement and no consideration was paid, although receipt of payment in full was endorsed on the back of the instrument. After decedent's death the envelope was produced and the probate court under a statutory authority ordered a conveyance to …

Recording - Operation Of The Recording Acts On Quitclaim Deeds

Michigan Law Review

A conveyed two specific lots in Harris County to B. Before that deed was recorded, and while the lots were still vacant, A conveyed several specific tracts of land to C and added a blanket clause of "all other lands and interest in lands belonging to A in Harris County"; C made a like conveyance to D; D conveyed the two specific lots in question to E by warranty deed; E conveyed the two lots to plaintiff by warranty deed sixteen years after the deed to C. All the deeds in the second chain of title were …

Future Interests - When Is Child En Ventre Sa Mère Regarded As In Being

Michigan Law Review

How far will the courts go in regarding a child en ventre sa mere as in being for the purpose of determining the character of interests in property? This question is brought to the fore in Re Joicy, a recent decision of the English Court of Appeal. In that case, a will declared that certain property should be held in trust for all of the children of the testatrix who should survive her and attain the age of twenty-one years, and provided that if any such child should die within the period of twenty-one years "leaving any issue him …

Vendor And Purchaser - Mortgaging Of Land By Vendor - Effect On Vendee's Duty To Continue Installment Payments

Michigan Law Review

Plaintiffs agreed in writing to purchase a tract of land from the defendant, the purchase price to be paid in stated installments or in full at any time at the option of the plaintiffs. Two days after the formation of the contract the defendant mortgaged the land, and about eight months later placed a second mortgage on it. Plaintiffs denied having any knowledge of the mortgages until attempts were made to foreclose them. Previous to this, however, they had defaulted in their payments. In an action in general assumpsit to recover the amount of the installments paid it was held …

The Equitable Lien As A Remedy For Breach Of Contract

Michigan Law Review

Modern decisions have developed the equitable lien as an important procedural device alongside the equitable remedies of constructive trust and subrogation, with both of which it is intimately connected. The equitable lien or charge, enforceable by foreclosure and sale, is in many situations the most convenient and flexible device for enforcing equitable obligations. A sphere of activity in which it has already proved useful, and in which its usefulness may increase, is in the field of breach of contract. The equitable lien here provides an intermediate ground between affirmative specific performance and complete rescission.

Future Interests -Transferability Of Right Of Entry For Breach Of Condition

Michigan Law Review

Plaintiff's ancestor conveyed land to the city, on the express condition that the city should construct and forever maintain a "speedway" on the premises conveyed, reserving to himself, his heirs and assigns a right of entry for breach of the condition. Subsequently, before the condition was broken, he conveyed to a third party all his remaining land adjoining the Speedway, "together with all the right, title and interest of the party of the first part, in said Speedway." The breach of the condition having since admittedly occurred, the plaintiff, the heir of the original grantor, sought to assert the right …

Bankruptcy - Fraudulent Transfers -Trustee's Assignee

Michigan Law Review

Since bankruptcy proceedings contemplate a sale of the debtor's assets, the importance of knowing what the trustee may sell is at once obvious. One must, however, go further and inquire as to the rights of purchasers from the trustee. This question assumes importance to the trustee, since it determines what he may sell, and is also important to the purchaser, since it determines what he may buy. The answer determines the efficiency of our bankruptcy machinery. In this comment we propose to consider one phase of this general question: May the trustee assign his right to set aside a fraudulent …

Taxation - Property Subject To Inheritance Tax - Effect Of Reservation Of Life Income

Michigan Law Review

A father conveyed real estate to his daughter three years before his death by warranty deeds, absolute on their face but with the oral understanding that the father was to have all the income from the property during his lifetime. In a letter which the daughter wrote to her father several years later the terms of this oral agreement are given, but this letter, set forth in the statement of facts, is apparently not relied on by the court since no mention of it is made in the opinion. Held, that the gift was taxable under the inheritance tax …

Trusts - For Employees - Definiteness Of Cestui

Michigan Law Review

The testator by his last will and testament devised a saw mill owned by him to certain trustees, the will reading, "I suggest that my said trustees sell the mill" for a specified price about half the estimated value of the property to a corporation to be organized by "my employees." There was a further provision reading, "I suggest that all the employees who have been in my employment for five years or longer should hold stock in such corporation, should they so desire in such proportions as my trustees shall presence." After the corporation had been organized, the incorporators …

Vendor -Purchaser-Prospective Inability Of Vendor To Convey

Michigan Law Review

In a contract for the sale of sixty-three lots of a subdivision, the defendant agreed to take the purchase money by installments extending over a period of eighteen months, and promised to convey the premises free from encumbrances when twenty-five per cent of the sale price was paid. While the plaintiff was not in default the defendant mortgaged the entire subdivision to one who was not charged with notice, to secure the payment of bonds some of which did not mature for five years. Stipulations m the mortgage allowed the release of any lot on deposit with the mortgagee of …

Quasi-Contracts - Statute Of Frauds - Right To Restitution Of Money Paid On Oral Land Contract

Michigan Law Review

Plaintiff paid $1,000 on an oral agreement for the purchase of land. Defendant admitted receipt of the money but alleged he was ready, able, and willing to comply with the terms of the agreement and convey the land. Held, that since the contract was void under the statute of frauds, plaintiff might recover. Reedy v. Ebsen, (S. D. 1932) 242 N. W. 592.

Trusts - Compromise Agreement As Means Of Terminating Testamentary Spendthrift Trust

Michigan Law Review

In Rose v. Southern Michigan National Bank, the Michigan Supreme Court refused to terminate a spendthrift trust composed of both real and personal property, although to end litigation upon the will all the parties in interest had signed a compromise agreement to terminate the trust according to the Michigan statute. There was no objection as to the fairness of the agreement, upon which ground the court might have refused to sanction the compromise under the statute. The decision seems to have been based upon the theory that to give effect to the compromise agreement would defeat the purpose of …

Non-Assignment Provisions In Land Contracts, Edwin C. Goddard

Michigan Law Review

Many a sale of real estate is made to a purchaser who lacks the ready cash to pay the price. A deed of conveyance may be given with a mortgage back for the unpaid portion of the purchase price. But more and more in recent years the vendor has given a contract to convey conditioned upon the making of periodical payments of stipulated amounts, a deed to be given when the whole or a stated portion of the purchase price has been paid. The initial payment may be very small, and not infrequently the periodic payments are little more than …

Receivers - Extraterritorial Powers

Michigan Law Review

In these days of financial stress, the question of the extraterritorial powers of a receiver becomes especially acute. Though to the business man state lines have lost their significance, the lawyer is still confronted with independent sovereignties, both federal and state, each jealously safeguarding its own particular province. Receivers, appointed for an insolvent corporation or for a judgment debtor, seek to recover assets situated in foreign jurisdictions. Economy and expediency dictate the prevention of a dismemberment of the estates and the saving of expensive ancillary receiverships by a personal pursual on the part of the home receivers of those outlying …

Future Interests - Devise Of Life Estate With Superadded Power To Sell Fee

Michigan Law Review

Testator gave his wife a life estate and added, "and I further empower her to sell any and all of either my personal real or mixed estate whenever she may think it to her interest to do so," with a limitation over to his son of whatever property remained of his estate at the time of the widow's death or remarriage. The widow conveyed the estate in fee to her daughter for valuable consideration. On the widow's death the son, as remainderman, brought ejectment against the daughter. Held, that the action did not lie since the widow had been …