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Eddington v. Turner

    Citation

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    Bloomberg Law

    Brief Fact Summary. Thomas Turner drafted a will devising certain land to his sister, Sallie Turner. Thereafter, Thomas Turner gave a 60-day option to purchase land to Eddington. After Thomas Turner died, Eddington decided to exercise his option to purchase the land.

    Synopsis of Rule of Law. In this case the testator evidenced his desire that his sister should have a portion of his land for life. Then he granted an option for 60 days, which he had no way of knowing would be exercised or not. The testator had no enforceable right to the purchase money, thus the application of equitable conversion would not make sense.

    Facts. Thomas Turner drafted a will on October 17, 1938, devising certain land to his sister, Sallie Turner. Thereafter, on October 20, 1938, Thomas Turner gave a 60-day option to purchase land (including the land devised to his sister) to Eddington. Thomas Turner died prior to the expiration of the 60-day period, and Eddington, after Turner’s death but prior to the expiration of the option, decided to exercise his option to purchase. When Thomas Turner died, his only heirs at law under the intestate law of the State of Delaware were his two sons, who were also executors of his will. Eddington filed a bill for specific performance of the option agreement as against the estate, a deed was made to Eddington for the property, and the purchase money was deposited into the court. A petition was made to draw the money out of the court. The lower court held that Sallie Turner was entitled to a life interest in such portion of the proceeds as the land devised to her for life bore to the amou
    nt of land conveyed under the option to purchase. The proportion, as found by a special master, was approved by the lower court and ordered paid to Sallie Turner, who then executed a bond conditioned upon the payment of the sum upon her death to Arthur Turner and Thomas H. Turner, the sole heirs of the decedent. An appeal was taken.

    Issue. Does the granting of the option to purchase, made after the execution of the will, and the subsequent exercise of the option after the death of the optionor, operate as an equitable conversion of the property relating back to the date of the option, so that the proceeds of sale would pass to the personal representatives rather than to the specific devisee of the land?

    Held. No. Decree affirmed.
    The court found that this case was very similar to the case of Lawes v. Bennett, Ch., 1 Cox 167, England, when the idea of relation back of equitable conversion was stated. The rule in Lawes was that when the option is exercised after the death of the optionor, the equitable conversion relates in some way back to the date of the option, and not to the date of its exercise, and consequently the proceeds of the sale are treated as personalty, passing to the personal representatives rather than to the specific devisees of the real estate itself.
    This court found that the rule of Lawes, was not based on any sound principle of law or equity and did not work to uphold the intent of the testator.
    In this case, the testator evidenced his desire that his sister should have a portion of his land for life. Then he granted an option for 60 days, which he had no way of knowing would be exercised or not. The testator had no enforceable right to the purchase money, thus the application of equitable conversion would make no sense.
    At the death of Thomas Turner, his sister took the land subject to the obligation to convey it upon the exercise of the option. The land was then converted into money, and as she had the life interest in the land with its rents and profits prior to conversion, so she should have the life interest in the proceeds of the land. The equitable conversion did not take effect until the exercise of the option, at which point the sister had already taken a vested interest in a life estate of the land devised to her under the will.

    Discussion. Note that if the Court had applied the relation back rule to the option in this case it would have been a double legal fiction. First, the equitable conversion is itself a legal fiction. Secondly, the idea that Thomas Turner, decedent, had any right to the purchase money (as he would under equitable conversion) at the time of the giving of the 60-day option would be another fiction, as the court pointed out.


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