Newton v. Taylor

32 Ohio St. (N.S.) 399
CourtOhio Supreme Court
DecidedDecember 15, 1877
StatusPublished

This text of 32 Ohio St. (N.S.) 399 (Newton v. Taylor) is published on Counsel Stack Legal Research, covering Ohio Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Newton v. Taylor, 32 Ohio St. (N.S.) 399 (Ohio 1877).

Opinion

Wright, J.

The statement of facts is long and complicated, but we extract this: Mrs. Keziah Taylor brought suit to enforce what she claimed was a trust, existing in her favor, in certain land, held in her husband’s name, at his death. She claims that the circumstances under which, the land was bought create this trust.

Many years ago, in 1832, Pirn Taylor, the husband, was-without means. He and his wife wanted to buy some land. The price was $2,000, a sum that Pirn Taylor could not raise. A payment of $500 could secure the bargain, but the husband had neither cash nor credit to this extent. Under these circumstances, husband and wife agreed that she should get the needed sum from her brother, Mahlon> Whittacre, the land to be purchased for her, and, when paid for, the deed to be taken in her name. Pursuant to-this arrangement, plaintiff did get the $500 from her brother,, advising him of the facts; the understanding being that he was to be reimbursed; that the money was to be used as indicated, this being his sole security for repayment. This understanding and agreement about the purchase of the property was the inducement to the brother to advance-the $500, and without it he would not have made the advance.

Thereupon the husband buys the land. One-half of it is sold, the proceeds going to pay for the purchase of the whole. Some lots, carved out of the purchase and some-property of the wife made further payments, and finally, the property being all paid for, the husband has the deed made, not .to the wife, but to himself. The wife claims-that these circumstances raise a trust in her favor as to this land so taken in her husband’s name, which is half of the-whole original purchase. The facts of the alleged trust-[407]*407rest in parol merely, and it is claimed they can not be thus proved.

After tbe husband had thus got the deed for the property in his own name, he made two mortgages upon it to Simeon Jennings. The first mortgage was taken without knowledge of the alleged trust, and, as against this, the district court finds the wife has no claim. The second mortgage was assigned to one Webb, with notice of the alleged trust, and as to this her rights are held to be paramount.

It is to be determined whether or not, from the facts found, the alleged trust can be raised in law.

The husband was unable to buy the property. He was unable even to raise the first $500. The wife undertakes to do it. She gets it from her brother upon the understanding that it is to purchase laud in her name. Without this understanding, he would not have advanced it at all, and this understanding is all the security he asks or gets for a repayment. Knowing all this, having been instrumental in bringing it about, for the husband to violate the whole agreement from beginning to end, by taking the deed in his own name, is, to say the least, very like a fraud, both upon his wife and upon her brother.

A trust may arise ex maleficio. In Lloyd v. Spilletts, 2 Atk. 148, Lord Hardwicke speaks of resulting trusts as trusts by operatiou of law, and classifies them : First, where an estate is purchased in the name of one person, but the money or consideration is given by another; secondly, where a trust is declared only as to part, and nothing said as to the rest, what remains undisposed of results to the heir at law. He then proceeds to observe : “ I do not know of any other instance besides these two where this court have declared resulting trusts by operation of law, unless in cases of fraud, and where transactions have been carried on mala fide.” These remarks of Hardwicke are cited in Fleming v. Donahoe, 5 Ohio, 255.

In the report of the same case (Barnardiston’s Chy. 888), the lord chancellor says that the two cases of trusts above alluded to are the only two instances that he remembered [408]*408of trusts that have been allowed to arise by operation of law since the statute of frauds and perjuries, unless where there has been a plain and express fraud. "Where there has been, a fraud in gaining a conveyance from another, that may be a reason for making the grantee in that conveyance to be considered merely as trustee. Trapnall v. Brown, 19 Ark. 89.

A trust of this kind is a mere implication of law, from the fact of the purchase with another’s money, and the fact of fraud in procuring the legal title.

In Browne on Frauds, § 84, it is said : “ Even where the contract to hold in trust is the means of obtaining the legal title, a case which falls under the third class mentioned by Lord Ilardwicke, the trust is not created by the contract, but results or is implied from the fraud.”

Perry on Trusts, § 166, speaks thus : “ There is another large class of trusts, which arise from frauds committed by one party upon another. Thus, if one party procures the legal title to property from another’, by fraud or misrepresentation, or concealment, or if a party makes use of some influential or confidential relation which he holds toward the owner of the legal title, to obtain such legal title from him upon more advantageous terms than he could otherwise have obtained it, equity will convert such party thus obtaining property into a trustee. If a person obtains the legal title to property by such arts, or acts, or circumstances of circumvention, imposition, or fraud, or if he obtains it by virtue of a confidential relation and influence under such circumstances that he ought not, according to the rules of equity and good conscience, as administered in chancery, to hold and enjoy the beneficial interest in the property, courts of equity, in order to administer complete justice between the parties, will raise a trust out of such circumstances or relations; and this trust they will fasten upon the conscience of the offending party, and will convert him into a trustee of the legal title, and order him to hold it, or to execute the trust in such manner as to protect the rights of the defendant party and promote the safety [409]*409and- interests of society. Such trusts are called constructive ■trusts.” These trusts the author distinguishes from implied or resulting trusts, which arise from the intention of parties, as manifested in contracts made in good faith, while the constructive trust arises from the opposite of good faith.

Washburn e makes the same classification of implied, resulting, and constructive trusts. 2 Wash. 470.

In the case of Morey v. Herrick, 18 Pa. St. 128, it is said: It is well settled that if one be induced to confide in the promise of another that he will hold in trust, or that he will purchase for one or both, and is thus led to do what he would otherwise have forborne, or to forbear what he contemplated to do in the acquisition of an estate, whereby ■the promissor becomes the holder of the legal title, an attempted denial of the confidence is such a fraud as will operate to convert the purchaser into a trustee ex maleficio.”

Commenting upon this ease, Tiffany & Bullard on Trusts, 189, say: “ The trust in these cases is raised ex maleficio, and is not so much because of the fraud in the original acquisition of the property as in the subsequent refusal to execute the trust.” The opinion, however, of Browne, in his treatise on frauds, seems to be that the fraud which suffices to lay the foundation of a trust is not simply that fraud which is involved in every deliberate breach of contract.

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Bluebook (online)
32 Ohio St. (N.S.) 399, Counsel Stack Legal Research, https://law.counselstack.com/opinion/newton-v-taylor-ohio-1877.