
    George Marvel v. Wiley Marvel.
    Filed December 2, 1903.
    No. 11,752.
    1. Trust: Parol Agreement. A parol agreement, made at the time of executing a conveyance of real estate, that the grantee shall hold the property in trust for the grantor and, when sold, pay the proceeds to him, the conveyance not being obtained by fraud or undue influence, is void, as an attempt to create an express trust in real estate by parol, and the land and the money for which it is sold belong to the grantee.
    2. Contract: Prooe. The evidence by which a contract shall be proved is no part of the contract itself, and is governed, therefore, by the lex fori and not by the lex loci contractus.
    
    Error to the district court for Hamilton county: Samuel H. Sornborger, Judge.
    
      Affirmed.
    
    
      Eugene J. Earner and Jerome E. Smith, for plaintiff in error.
    
      William Ledyard Stark and John E. G-rosoenor, contra.
    
   Duffie, C.

In October, 1878, the plaintiff, George Marvel, conveyed a tract of about three and a half acres of land, situated adjacent to the village of Waynesville in the state of Illinois, to his brother, Wiley Marvel, the defendant. The land is known as the “Mill property.” In the year 1881 the plaintiff removed to the state of Nebraska. His brother sold the land on the 24th day of December, 1884, for $400, and the plaintiff brought this action in the district court for Hamilton county to recover the proceeds of that sale. The district court found generally for the defendant, and the plaintiff has prosecuted error to this court. His theory of the transfer of the land to his brother is stated in his brief as follows:

“Property was dull sale and he had small capacity to dispose of it. His brother, Wiley Marvel, finally said to him that if he (Wiley) had the mill property he could get some money out of it for him (George), and, acting on this suggestion, on October 9, 1878, George Marvel and wife conveyed the mill property to Wiley Marvel, under the express agreement, that Wiley should in turn sell the property and pay the proceeds to George. The conveyance was made wholly 'without consideration. Wiley Marvel entered into occupation of the mill property immediately on delivery of the conveyance to him, using it to pasture stock, and on December 24th, 1888, sold it for $400. No part of this sum was paid, over to George Marvel, though often requested.”

The defense is: First, the statute of frauds; second, that there were other transactions between these parties, from which the plaintiff was owing the defendant, at the time the defendant sold the land, more than the amount received for the land, so that in an accounting in equity there was nothing due the plaintiff.

There was no written evidence of' a contract on the part of the defendant to hold the- title in trust for the plaintiff and to dispose of the same for his benefit. There is no allegation in the petition that any fraud or deceit was practiced upon the plaintiff, by the defendant, to procure a conveyance of this land. The doctrine, therefore, established in Brison v. Brison, 75 Cal. 525, 7 Am. St. Rep. 189; Gregory v. Bowlsby, 115 Ia. 327, 88 N. W. 822; Larmon v. Knight, 140 Ill. 232, and Polled v. McKenney, 69 Neb. 742, does not apply.

The plaintiff makes no such’ claim, but, on the other hand, says in his brief:

“This is not an action to establish any right of George Marvel in the land described in the pleadings. It is simply an action brought to recover the price for the conveyance of the lands, in accordance with the terms of the trust which Wiley Marvel assumed. The title to the premises passed irrevocably to WTlev Marvel by the deed of George Marvel and wife. It is not sought to disturb that title in any respect.”

The plaintiff relies upon the principle announced in Bork v. Martin, 132 N. Y. 280. He says that the proceeds of the land should be paid by the defendant to the plaintiff; that is, the plaintiff has a claim against the defendant for that amount. It seems to be held in Boric v. Martin, supra, that although “the land was conveyed to the defendant upon an oral trust, invalid under the statutes of frauds and of uses and trusts, yet it was lawful for him to perform it;” and if he sells the land and retains the money, he has performed the trust so far that he may be compelled to fully perform it-'by paying over the proceeds in accordance with the oral agreement. It seems to hold that when the trustee has sold the trust estate, a suit against him for the proceeds does not in any manner involve the trust character of the estate which was sold. It concedes that the title of the so-called trust could not be impeached, and that he could not be required to reconvey to his grantor. It acknowledges that the court is powerless to compel him to proceed one step in' the execution of his trust by making a sale of the land, and yet holds that he can not retain the proceeds of the sale of the lands to which they concede he holds a perfect and indisputable title; that one who has no standing in court to question his title to the land, or to claim any beneficial interest in it for himself, may have the assistance of the court to impress a trust upon the proceeds of the sale, if one is made.

This rule would defeat the purpose of the statute of -frauds in every case in which the supposed trustee has sold the lands and kept the proceeds. It establishes an arbitrary rule that the statute shall not apply in such cases; and we can not concur in such a doctrine.

Another question relating to the statute should be noticed: The statute of Illinois relating to the creation of an express trust in land was pleaded by the defendant. That statute is not as broad as our own, and some decisions of the supreme court of Illinois relating to that statute are called to our attention as authority for maintaining this action. It is said that, as the agreement was made in Illinois, the laws of that state must govern the contract so far as its nature, application and interpretation are concerned. While this is true in relation to the lew loci contractus, it is equally true that the lew fori must govern the course of procedure in giving redress upon the contract. The evidence by which a contract •shall be proved is no part of the contract itself, and is governed, therefore, by the rule of the jurisdiction where •the action is tried and not of that in which the contract was made. This is well illustrated in Leroux v. Brown, 14 E. L. & Eq. 247, in which it was held that an action can not be maintained in the courts of England upon a parol contract made in France, which was not to be performed within one year from the making thereof, although the contract was valid by the laws of France. The case turned upon the question whether the statute made void such contracts. If it made them void, then, inasmuch as the law of France governed the contract, the suit could be maintained, but if the statute applied to the remedy merely, then, inasmuch as the law of England governed the course of procedure, no recovery could be had. Lord Brougham said in Bain v. Whitehaven & Furness Junction R. Co., 3 H. L. Cas. 1:

“Whether a witness is competent or not, whether a certain matter requires to be proved by writing or not; whether certain evidence proves a certain fact or not; that is to be determined by the law of the country where the question arises, where the remedy is sought to be ‘enforced, and where the court sits to enforce it.”

The cases all agree that the statute requiring an express trust to be evidenced by writing does not render a trust void but requires, only, that the proof of the creation of such a trust shall be evidenced by writing. The statute does not strike at the contract itself but at the manner and method of proving such a contract, and the proof must conform to the laws of the state where the action is tried.

But conceding the law to be as claimed by the plaintiff, we can not see that the second defense is not made out by the evidence. It will be remembered that the defendant held the land for five years after it was conveyed to him by his brother, and then, having sold it, retained the proceeds for fourteen years before this action was begun. The evidence shows conclusively that there were at this time, and at about the time of the conveyance of the land, other transactions between the parties from which the plaintiff became indebted to the defendant. The defendant’s right to retain the proceeds of the land, on account of those transactions, was not questioned by the plaintiff for many years after the transactions occurred, and there is substantial evidence in the record from which the trial court might have found that the defendant’s claim against the plaintiff equalled the plaintiff’s claim against him, and were so considered by both parties for many years. We do not think that the evidence is so wanting upon this point that it can be said that the judgment of the trial court is clearly wrong.

We think that the judgment of the district court should be affirmed, and so recommend.

Ames and Albert, CC., concur.

By the Court:

For the reasons stated in the foregoing opinion, the judgment of the district court is

Affirmed.  