Baum v. Grigsby

Field, C. J. delivered the opinion of the Court Norton, J. concurring.

The doctrine that a vendor of real property, after an absolute conveyance, retains an equitable lien for the unpaid purchase money, prevails in England and in nearly all the States of the Union. The difference of opinion in the numerous cases upon the subject in the Courts of this country relates principally to the character of the lien, and to the question whether it passes -with a transfer of the claim of the vendor for the purchase money. The hen, it is conceded, is not waived, in the absence of express agreement to that effect, by the fact that the vendor takes the note or other personal security of the vendee for the money. Such personal security is considered as only intended to meet and overcome the acknowledgment of the receipt of the money in the deed. On the other hand, when any other independent security is taken—as a mortgage on the land, or upon other property, or the personal responsibility of a third person—the lien is held to be waived, unless there is at the time an express agreement for its retention. The taking of a distinct, independent security is presumptive evidence of the waiver.

The fact, therefore, that the vendee in the present case gave his negotiable promissory note to the vendor for a portion of the purchase money, in no respect affects the equitable lien of the latter. The question presented is, whether that lien passed to the plaintiff with the indorsement of the note to him. There was no attempt made to assign specially the lien; its assignment is asserted from the simple transfer of the note.

The question, upon the authorities, is clearly with the appellant. [176]Indeed, with the exception of decisions in two or three States, the adjudged cases are uniformly against any assignment of the lien by a transfer of the note or other personal security of the vendee. “I am not aware of any case,” says Chancellor Walworth, “ where the assignee of the note or the security has been permitted to sustain such a claim on an implied agreement to assign the lien.” (White v. Williams, 1 Paige, 506.) “I do not find in the English books,” says Mr. Justice Hesbit, of the Supreme Court of Georgia, “ a single case in which it (the lien) has been enforced in favor of the assignee of the note for the purchase money.” (Wellborn v. Williams, 9 Geo. 89.)

The cases which deny that the hen passes with the personal security of the vendee do not rest, except in a few instances, upon the want of a special assignment from the vendor, but upon the ground that the hen is in its nature unassignable; and to that conclusion we have arrived. The hen is not a specific, absolute charge upon the property. It is simply a right to resort to the property upon a failure of payment by the vendee. It does not arise from any agreement of the parties, but is the creature of equity, and is estabhshed solely for the security of the vendor. It is founded upon the natural justice of allowing a party to reach the property, which he has transferred, to satisfy the debt which constitutes the consideration of the transfer. It is, therefore, the personal privilege of the vendor. The assignee of a note given for the purchase money stands in a very different position. He has not parted with the property which he seeks to reach, in consideration of the note he has received. He has never held the property, and has, therefore, no special claims upon equity to subject it to sale for his benefit. The particular equity of the vendor in this respect cannot, in the nature of things, be asserted by another. “ It is indispensably necessary,” says Chancellor Bland, “ to the existence of such a lien, that the parties should stand in the relation towards each other of vendor and vendee of real estate, the purchase money of which has not been folly paid. If that relationship is, in any manner whatever, put off, altered, or relinquished, an equitable lien either cannot arise or will be destroyed. The pure relationship of creditor and debtor, or of borrower and lender, is incompatible with