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Anna S. Loring & another vs. Henry M. Whitney

Massachusetts Supreme Judicial Court1897-02-24
167 Mass. 550

Summary

Holding. The buyer is not required to accept the title because a reasonable doubt exists regarding the validity of the title due to unresolved questions about the trust deed's delivery, creation, and termination, and the potential for future claims by the heirs or appointees of the wife and daughter. The bill is dismissed.

A seller contracted to convey land to a buyer, but the title was encumbered by a recorded deed of trust created for the benefit of the seller's wife and daughter for their lifetimes, with remainder interests for their heirs or appointees by will. Although the trustee named in the deed refused to accept the trust and joined in executing a release deed back to the original owner, no formal court proceedings were brought to cancel or annul the trust deed, and the original owner merely retained possession. The buyer refused to accept the title, claiming it was defective.

The court examined whether a valid trust had been created despite uncertainty about whether the deed of trust was ever properly delivered. While the trial court found no delivery had occurred, that finding would not bind the heirs of the wife and daughter, whose claims would arise under the deed itself rather than through succession. The court noted that if delivery had occurred, a valid trust would exist, and the heirs' interests would remain unresolved. Additionally, even absent proper delivery, serious questions remained whether the grantor's intent to create a trust through recording the instrument, combined with his other acts, might still create enforceable beneficial interests in favor of those heirs or appointees.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

  • Whether a deed of trust was properly delivered to create a valid trust
  • Whether a trust could be created by recording without delivery if the grantor intended to do so
  • Whether the heirs or appointees could claim beneficial interests despite the trustee's refusal and release deed
  • Whether a buyer may reject a title burdened by unresolved trust interests

Procedural posture

The buyer brought suit seeking to compel the seller to convey land despite the existence of a recorded but disputed deed of trust.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion

majority opinion

Allen, J.

In some cases, although there may be a remote chance that a title may be exposed to litigation and finally held to be imperfect, yet the risk may be found to be so small that a purchaser will be held to accept it. Cushing v. Spalding, 164 Mass. 287. Hayes v. Harmony Grove Cemetery, 108 Mass. 400. In other cases, if a reasonable doubt exists as to the validity of the title, or if there is a chance of litigation, although somewhat remote, it is held that the purchaser ought not to be compelled to take the risk. Daniell v. Shaw, 166 Mass. 582. Hunting v. Ramon, 160 Mass. 441. The present case falls within the latter class.

The owner of the land put on record a deed of trust for the benefit of his wife and daughter for life, and then to their heirs or appointees by will, with a power of sale upon the written consent of the wife and daughter. The person named in the deed as grantee and trustee declined to accept the trust, and sought to annul it, so far at least as he was concerned, by executing a deed of release to the original owner, in which the wife and daughter joined. But no proceedings were had in court to cancel or annul the deed, nor were any further positive or active steps taken in this direction by the grantor, except that he after-wards remained in possession of the premises.

A question arises at the outset whether the deed of trust was ever delivered. The evidence at present is satisfactory to show that it was not, and it was so found at the hearing. See Barnes v. Barnes, 161 Mass. 381. This finding, though conclusive upon the wife and daughter, would not be so upon their heirs, whose claim would arise under the deed, and not by succession. The outside facts tend somewhat to show a delivery, and in the absence of the testimony of the grantee it is possible that a delivery might hereafter be found to have been made. Certainly, if the deed was delivered, or if it should ever be so found, a valid trust was created, and, if made, it has never been terminated so far as the interests of. the heirs of the grantor’s wife and daughter are concerned.

But if it should be assumed that there was no technical delivery of the deed, the question remains whether, nevertheless, it could be construed as creating a trust. The grantor having died, his intentions must needs be inferred from his acts. When he put the deed of trust on record, did he intend thereby to create a trust, and did he suppose that he had done so ? If such were his intent and supposition, would or could the instrument be construed as creating a trust, although not so delivered as of itself to vest a title in the grantee ? We cannot say that these questions are so free from doubt that the defendant ought to be held to accept the title. In the full and excellent brief of the defendant many cases are cited to show possible risk from this source, of which we need only to refer to Adams v. Adams, 21 Wall. 185, and the cases collected in Ames’s Cases on Trusts, 106. The deed itself recognized the possibility of a successor in the trust, and provision for the appointment of a new trustee, when the original trustee under a written instrument declines, is made by Pub. Sts. c. 141, § 5.

Under certain circumstances, a bill in equity to annul or cancel a deed of trust may be maintained. Barnes v. Barnes, 161 Mass. 381. Taylor v. Buttrick, 165 Mass. 547. Keyes v. Carleton, 141 Mass. 45. Garnsey v. Mundy, 9 C. E. Green, 243. This form of remedy to clear the title, however, was not sought in the present case.

While the risk of a claim of a beneficial interest by heirs or appointees of the wife and daughter may be and probably is small, it is nevertheless a riskwhich the defendant ought not to be held to assume. As suggested in the brief, he might have to defend his title in the Federal courts, where the doctrine of Adams v. Adams, 21 Wall. 185, would not be open to question.

Without dwelling upon other points presented, the entry must be, Bill dismissed.