Summary of Rockefellor v. Gray, Supreme Ct. of IA (1922)
Parties: PL – Rockafellor – Acquired the land from Doffing and agreed to repay the mortgage of $500
DF Gray – person who mortgage was owed to.
Appellant Connelly – acquired the land in a sheriff’s deed.
Dixon subsequent owner who got the land from Connelly for $4k – Is he a party here? He doesn’t appear to be.
Appellee Hansen & Gregerson – present owners – who got a special warranty deed for $7K from Dixon- filed cross complaint against Connelly
Cause of action/remedy sought: The following is a cause of action to set aside the foreclosure sale under the mortgage claiming that the court did not have jurisdiction over him.
This is an action to set aside and vacate the foreclosure sale on the ground that it was void due to no jurisdiction acquired of P in said action (no personal jurisdiction). Year and a half after suit begins against Gray, Connelly and H & G were made parties to the action. H & G cross claimed Connelly. Court entered a decree for P adjudging the foreclosure proceedings invalid and void, and vacating and setting aside sheriff’s deed, and on the cross petition entered a judgment for H&G against Connelly for $4000 plus interest from the date of the deed from Connelly to H&G.
Procedural History: In 1920, Hansen and Gregerson filed a cross petition. In their cross-petition, they prayed that if P was successful in setting aside the sheriff’s deed, they get judgment against remote grantor Connelly upon the covenants in his deed to their immediate grantor, Dixon. Then, Connelly and Hansen & Gregerson were made parties to the action. Ct entered a decree in favor of P, saying that the foreclosure was void and vacated and set aside sheriff’s deed, and on the cross petition entered a judgment for H&G against Connelly for $4000 plus interest from the date of the deed from Dixon to H&G. Connelly appealed and the only issues the court looked at were those in relation to Connelly and H&G. Sup court affirmed the decision of the lower court.
Facts: PL purchased land, to which DF owed a $500 mortgage, which PL agreed to pay. Foreclosure proceedings happened anyway, and a sheriff’s deed was executed and delivered to Connelly 2/11. On 4/11, Connelly conveys to Dixon for $4000 by deed containing usual covenants and restrictions. On 6/11 Dixon conveyed to H&G for $7,000. In 8/18, PL began the suit. In 1/20, Connelly and H&G were made parties to the suit, and H&G cross petitioned Connelly.
Issue(s): Under IA property law, can a remote grantee seek damages from a grantor for violation of the covenant of seisin. This is related to whether the covenant of seisin runs with the land?
Holding: Yes, but the remote grantee can only recover the consideration that grantor received for the land, rather than what the remote grantee might have paid for the land. Affirmed district court judgment.
Court’s Rationale/Reasoning: Some jurisdictions that found that the covenant of seisin ran with the land based it upon the fact that the original covenantee was in possession of the premises (which is not the case here- original covenantee here as never in possession of the premises). Neither Connelly nor Dixon had possession of the premises. However, the rights of a remote grantee are acquired by conveyance (assignment) and not by virtue of actual possession of the premises. Thus, since when Connelly executed and delivered the deed to Dixon he did not have title nor possession of the premises, Dixon at that time had a cause of action against him for breach of the covenant of seisin. The cause of action that Dixon had against Connelly passed to H&G by the deed that was executed and delivered to them in 1918. Plus, the 10 year SOL had not passed.
Possession is not required to establish seisin in fact. Seisin runs with the land to protect against the deprivation of title and enjoyment of the lands conveyed. It is illogical to require possession in order to establish a cause of action, based on the above assignability of the chose in action rights.
For damages: the remote grantee can’t get more than the original grantee could have gotten from the grantor so since Dixon paid $4K for the property, that’s all they can get-plus interest.
Amount of recovery is the amount of consideration which the grantor received from his grantee, not necessarily what that grantee paid (it can be less, of course, if the damages are less). Here Connelly claims he really received no consideration, and so shouldn’t have to pay anything. However, Parol proof (evidence of alleged terms not included in the written record of agreement, but claimed by one of the parties to have been agreed to orally before or at the time of execution of the written contract or in a prior writing) of actual consideration to contradict a deed is not admissible in a suit by a remote grantee against an original grantor. Also, it is assumed P relied on the grantors deeds as far as the consideration and covenants, and so original grantor is estopped to claim the consideration was actually less.
Rule: Seisin in this jurisdiction runs with the land, and is broken the instant a conveyance is delivered, and then becomes a chose in action held by the covenantee in the deed, and a deed given by that covenantee operates as an assignment of such chose in action (chose in action is the right to bring an action to recover debt, money or a thing) to a remote grantee, who can maintain an action against the grantor in the original deed.
Did court avoid issues?: Whether the remote grantee (Hansen & Gregerson) could recover their $7K from the remote grantor (Dixon).
Dicta: The history of seize running with the land. The history of amount of damages allowed to a remote grantee from a grantor.