Willetts v. Brown

49 N.Y. Sup. Ct. 140, 5 N.Y. St. Rep. 175
CourtNew York Supreme Court
DecidedOctober 15, 1886
StatusPublished

This text of 49 N.Y. Sup. Ct. 140 (Willetts v. Brown) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Willetts v. Brown, 49 N.Y. Sup. Ct. 140, 5 N.Y. St. Rep. 175 (N.Y. Super. Ct. 1886).

Opinion

BARKER, J.:

As the complaint was dismissed on the defendants’ motion before any proofs were offered or any statement made of the facts which the plaintiffs intended to prove in support of his cause of action, it must be determined by the allegations contained in the complaint whether the same was properly dismissed, for it is to be presumed that the plaintiffs could sustain, by competent evidence, the facts therein set forth. A perfect cause of action was stated against the defendant Kervin, entitling the plaintiffs to the recovery of a personal judgment against him, for a large sum of money and for the other relief which was demanded in the complaint. The complaint states, in substance, that the plaintiffs, Isaac Willetts and William Cranston, were the owners of and had the right to operate and mine for oil, on certain premises which are specifically described, and as to another parcel they were entitled to one-eiglith of the oil which might be produced thereon by other parties as a royalty to be paid to them. They were in possession of the first named parcel, and had drilled five oil wells thereon, which were productive, and which had produced a considerable quantity of oil. There was connected therewith, and used in developing the property, engines, derricks, pumps, drills and tanks for storing oil, such as are commonly used in that business. By an instrument, under seal, which is set forth in the complaint, the plaintiffs sold and transferred all their interest in the said property, together with the said machinery and apparatus, and in the royalty, before mentioned, to the defendant, Thomas Kervin, who agreed to pay therefor $32,000, and the complaint alleges that at the time of the commencement of the action there was due and unpaid on said contract $7,000. It is also alleged that Kervin entered into the possession of the premises, operated the wells and produced a large [143]*143quantity of oil. It is also averred that the other plaintiff, Leonard Willets, acquired an interest by purchase in the contract of bargain and sale prior to the commencement of this action. The plaintiffs also claim that by virtue of the contract they have a lien upon all the property which was the subject of the sale and the oil which has been produced, or which may be produced, as a security for the unpaid purchase-money, and seek in this action to enforce such lien, and for a personal judgment against Kervin for any deficiency that may exist after a sale. In the contract immediately following Kervin’s promise to pay the purchase-price, there is a provision that, “ all rigs, tanks, boilers, engines, tubing and casing now upon said land, or hereafter put upon the same, shall remain upon the same, as part and parcel of the said premises, until all payments shall be made and completed herein,” and the concluding paragraph of the agreement is as follows: It is further agreed, by and between the parties hereto, that in case of 'failure on the part of said Kervin to make the payments herein at the time they shall respectively fall due, for the period of ten days, then after such failure to meet such payment, all oil produced upon the said premises shall thereafter be run into the lines to the credit of Isaac Willets, as a security for such payments.” At the time of the sale there was some oil in store in the tanks on the premises, and the contract also contains this clause: “ All the oil produced upon the above premises shall be the property of the said Kervin, or if any be sold the avails thereof shall belong to him.” It is manifest, when taken in connection with the averments of the complaint, that the last-mentioned term of the contract, just quoted, was intended to be a sale of the oil in store at the time of the making of the agreement. We are inclined to the opinion, and in disposing of this appeal we shall view the contract as a sale in presentí, and vesting the title of all the property in the vendee.

The respondents’ position is, that as against Kervin the plaintiffs had no lien upon the property, and could only recover a personal judgment against him, and for that reason they were unnecessary parties, and there could be no advantage secured to the plaintiffs by retaining them as parties defendant to the action, pending the trial of the issues between them and Kervin. In our consideration of this question we have reached the contrary conclusion, and think [144]*144that the plaintiffs have an equitable lien upon the property and the oil produced until the entire purchase-price is paid. As the vendors were the owners of the fee of the land, their interest in the wells, and all the machinery used in operating the same, must be regarded as personal property, as between the parties to this action, by force of chapter 372 of the Laws of 1883, which provides: “ All oil wells and all fixtures connected therewith, situate on lands leased for oil purposes, and oil interests and rights held under and by virtue of ally lease, or contract, or other right or license to operate for or produce petroleum oil, shall be deemed personal property, for all purposes except taxation.”

As to a lien arising from the express contract of the parties, the general rule, as stated by one of the elementary writers, is: “ That every express executory agreement in writing, whereby the contracting party sufficiently indicates an intention to make some particular property, real or personal, or fund, therein described or ' identified, a security for a debt or other obligation, or whereby the party promises to convey or assign or transfer the property as security, creates an equitable lien upon the property so indicated, which is enforceable against the property in the hands, not only of the original contractor, but of his heirs, administrators, executors, voluntary assignees and purchasers or incumbrancers with notice.” (3 Pomeroy’s Eq. Juris., § 1235.)

The promise of the vendee was to give a security upon the oil produced, and the form and manner in which the same was to be perfected, so as to give the vendor some written evidence of their lien, was not provided for in the agreement. But, notwithstanding this omission, and regarding the contract as a mere execu-’ tory promise to give a lien, courts of equity regard such a promise as creating an equitable lien which will be enforced as against the party promising to give the lien and those who claim under him who are not innocent purchasers. (Pomeroy’s Eq. Jurisprudence, 373, § 1237.)

In this State the general rule, as stated, has been applied in particular cases so as to carry out and consummate, in an effective manner, the real intension of the parties, as stipulated in their agreement.

In Husted v. Ingraham (75 N. Y., 251) the plaintiff sold and delivered a quantity of carpeting to their vendees, which were put [145]*145down in their hotel, with the understanding that the purchasers should secure the purchase-price to the vendors by a chattel mortgage. The purchasers’ notes were received without exacting a chattel mortgage upon the carpets, and, thereafter, a receiver was appointed of the property of the purchasers, and he claimed a title to the carpets. In commenting upon the rights of the parties, the court said: “ The carpets having been delivered under an agreement that the price should be secured by a mortgage thereon, that agreement could have been specifically enforced in equity and constituted an equitable lien upon the property as against J. E. Miller & Co. (the purchaser), and all persons claiming through or under them, except bona fide purchasers having no notice of the lien.”

In Hale v.

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Cite This Page — Counsel Stack

Bluebook (online)
49 N.Y. Sup. Ct. 140, 5 N.Y. St. Rep. 175, Counsel Stack Legal Research, https://law.counselstack.com/opinion/willetts-v-brown-nysupct-1886.