The Trust and Loan Co. vs. Ruttan.

"be considered as being the person into whose hands "it was delivered, it being clear that there was no

delivery at all to the grantee; that the delivery was "not intended, to be a delivery to the grantee at all, "and that it was intended to be an instrument incom"plete as a transfer of the legal estate until the con"ditions prescribed had been performed. That being "so, it follows that, in my judgment, the Plaintiffs "retain and have the legal estate in the property un"affected by anything which has taken place.

The appeal, therefore, must, in my opinion, be allowed.

STRONG, J.:

I have come to the conclusion, that the finding of the learned Chief Justice who tried this case was the correct inference to be drawn from the evidence, and that the appeal ought to be allowed. There is no difficulty about the rule of law applicable to this part of the case.

Although it was formerly essential to make a sealed instrument operate as a mere escrow that express words should be used, such is not now the state of the law, and what would otherwise be an absolute delivery as a deed may be restricted by evidence of the surrounding circumstances shewing that only a conditional delivery could have been intended. Numerous cases, some of which I refer to below, shew this (1). They establish no other rule

(1) Bowker v. Burdekin, 11 M. & W., 147; Millership v. Brookes, 5 H. & N., 798; Pym v. Campbell, 6 E. & B., 370; Davis v. Jones, 17 C. B., 625; Gudgen v. Besset, 6 E. & B., 986; Murray v. Ld. Stair, 2 B. & C., 82; Christie v. Wimington, 8 Exch., 287; Furness v. Meek, 27 L. J., N. S., Exch., 34; Boyd v. Hind, 25 L. J., N. S., Exch., 247.

The Trust and Loan Co. vs Ruttan.

of law than that I have just mentioned, but they shew the application of the rule to a variety of cases.

I think the whole dealing makes it plain beyond question that there was no delivery of the deed until after the perfection of the title, and that, therefore, the verdict should not have been interfered with.

But for another reason, I think, the Appellants are entitled to succeed on this appeal. Granting that the mortgage deed was absolutely delivered and accepted as a perfect deed as early as the date it bears, I should still be of opinion that the Plaintiffs would be entitled to recover in this action. This mortgage deed of the 10th April, 1855, although it contains no recital, comprises the usual absolute mortgagor's covenants for title. Now, for upwards of 40 years, it has been held in Upper Canada, that covenants for title, especially the usual covenant that the granting party is seized in fee at the date of the deed, a covenant which this deed contains in the absolute not in the ordinary restricted form, are as effectual in working an estoppel as a recital to the same effect would have been. The cases to which I refer, and which are always referred to as the leading cases on this point, are three : Doe Hennesey v. Myers (1), Doe Irvine v. Webster (2), McLean v. Laidlaw (3). Whether these decisions, attributing to the covenants the same efficacy as positive certain recitals are right, it is now too late (4) to inquire, as the principle has become a fixed rule of the law of property in the Province of Ontario, too well established therein to be shaken; and it is, of course, the law of that Province that this Court must administer on an appeal relating to real property situated there, just as (1) 2. U. C. Q. B., O. S., 424; (2) 2. U. C. Q. B., 224 ; (3) 2. U. C. Q. B., 222; (4) See Ram on legal judgments, p. 292.

The Trust and Loan Co. vs. Ruttan.

much as it is the Scotch law which the House of Lords administers with reference to land in Scotland.

There was, therefore, an estoppel worked by the mortgage deed of the 10th April, 1855, provided nothing passed by the deed. That nothing could have passed is apparent from the history of the title which is in evidence. The legal estate was outstanding in the Defendants, and, assuming that they were trustees for Thompson, he would still have been at law a mere tenant at will by whose conveyance nothing could have passed. It is out of the question to say that, because Thompson was in possession, an interest must be assumed to have passed by his deed; if we had nothing more before us than the fact of Thompson's possession, that would be prima facie evidence of seisin in fee, but we have the whole title before us, from which it appears that Thompson had no estate, except possibly a tenancy at will, which, of course, was put an end to as soon as he assumed to convey. Therefore nothing passed by his conveyance.

That this mortgage deed operated as a conveyance under the Statute of Uses, would make no difference, on the authorities already quoted and some others which I will presently refer to. The estoppel is not worked by the conveyance, as in the case of feoffment or a fine, but by the instrument which is evidence of the conveyance-the indenture. In other words, the estoppel is produced not by the nature of the assurance, ―a conveyance by way of bargain and sale operating under the Statute of Uses-but by the nature of the instrument—an indenture-by which that assurance is effected (1). This was the doctrine acted on by Vice

(1.) Cornish on Purchase Deeds, p. 7, and Cornish Essay on Uses,

p. 179.

The Trust and Loan Co. vs. Ruttan.

Chancellor Leach in the case of Bensley v. Burdon (1), upon which Doe Irvine v. Webster in a great measure proceeded.

In that case it was held that a recital in the release part of a conveyance by lease and release estopped the releasors, though contained in a deed operating as an innocent conveyance.

This decision was afterwards affirmed in appeal by Lord Chancellor Lyndhurst (2) and on the same grounds.

It is true, Sir Edward Sugden, in Lloyd v. Lloyd (3) questions this decision, but he does not advert to its having been affirmed in appeal, nor to the distinction between the estoppel having been effected not by the assurance but by the instrument; and he relies on Right v. Bucknell (4) as having overruled Bensley v. Burdon, in which he was certainly in error, for a careful perusal of Lord Tenterden's judgment in that case will show that though Bensley v. Burdon is referred to, not a word of disapproval of it is uttered; the decision in Right v. Bucknell proceeded on the uncertainty of the recital, which was that the grantor was legally or equitably entitled. It therefore results from these authorities that the deed of the 10th April, 1855, if it took effect at that date, as a deed duly delivered and accepted, estopped Thompson from denying that he was then seized in fee. Before leaving this part of the case, however, I should add, that the principle of Bensley v. Burdon and Doe Irvine v. Webster is affirmed in two New York cases, both decisions of Chancellor Kent: Jackson v. Bull (5) and Jackson v. Murray (6).

Then, it is a well established principle of the law of

(1) 2 Sim. & Stu., 519; (2) 8 Law Journal, p. 85; (3) 4 Dru. v. War., 369; (4) 12 B. & Ad., 278; (5) 1 Johns. Cases, 80; (6) 12 Johns., 2.

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estoppel, that if a man is estopped from denying that he had a particular estate which he has assumed to convey and he afterwards acquires that estate, the estoppel is said to be fed on the accrual of the interest which, by force of the estoppel, is at once carried over to the party in whose favor the estoppel has been created (1).

The leading case Doe v. Oliver, by which this doctrine was finally established, was a case of a fine where the nature of the conveyance or assurance, not the mere recital in the deed, worked the estoppel; and it was, both in Bensley v. Burdon and in Doe Irving v. Webster, denied that this doctrine was applicable to an estoppel by deed merely. In both these cases, however, it was applied to estoppel by indenture; and many cases proceeding on this principle, besides those quoted, are to be found in the reports of the Upper Canada Common Law Courts. This same doctrine has been recognized in a late case in the Supreme Court of the United States, Irvine v. Irvine (2), where Strong, J, says: "It is a general rule that when

one makes a deed of land, covenanting that "he is the owner, and subsequently acquires an "outstanding and adverse title, his new acquisition "enures to the benefit of his grantee, on the principle "of estoppel. As the deed of the Plaintiff in this case "contained an assertion that he was well seized in fee, "and had good right to sell and convey in fee, it would "not be difficult, were it necessary, to show that in "law he was acting for his grantee."

Therefore, the mortgage deed of the 10th April, 1855, assuming it to have been, as the Defendants contend, a

(1) Doe Christmas v. Oliver, 10 B. & C., 181; 2 Smith's L. C. p. 751; (2) 9 Wallace, (U. S.), 617.