Clarence M. Bull, Inc. v. Goldman

⁶⁶⁶ Davidson, J., delivered the opinion of the Court. On 4 December 1974, in the Circuit Court for Baltimore County, the appellant, Clarence M. Bull, Inc. (judgment creditor), filed a bill of complaint, seeking a judicial sale of real property to satisfy a judgment against Joyce Building Company (seller). The appellees, Robert C. and Phyllis R. Goldman (purchasers) were the then owners, and the Carrollton Bank of Baltimore (mortgagee) was the then mortgagee of the real property. On 9 May 1975, Judge John E. Raine, Jr., after a hearing, sustained the appellees’ second demurrer to an amended bill of complaint, without further leave to amend.

This appeal was taken from that order. The amended bill of complaint alleged in paragraph 1 that the judgment creditor had obtained a judgment against the seller for $6,153.12 on 31 July 1974, and that on 14 August 1974, execution was issued. The complaint .further alleged in paragraph 1 that the contract for the sale of the property, entered on 19 April 1973, failed to transfer equitable title to the purchasers because the seller “was not then seized with the land;” that the seller obtained title to the land on 7 August 1973; and that the deed from the seller to the purchasers, and the mortgage between the purchasers and the mortgagee were executed on 16 September 1974. The judgment creditor claimed that because the judgment was recorded and execution issued before 16 September 1974, it was entitled to a judicial sale of the property to satisfy the judgment.

Paragraph 2 of the complaint alleged the same facts, and claimed that “under the circumstances, a constructive trust by operation of law arose” as to “any funds in the hands of the Defendants or either of them due or payable to Joyce as of the date of the judgment. . . ,” and that “the Defendants became constructive trustees thereof for the benefit of the Plaintiff.” Count 2 then charged a violation of the constructive trust. The purchasers and mortgagee demurred to the amended bill of complaint, maintaining in relevant part that their claim to the property was superior to that of the judgment ⁶⁶⁷ creditor because the purchasers held equitable title to the real property under the contract of sale at the time the judgment creditor obtained its judgment and execution issued. They further charged that the bill failed to allege the essentials calling for the imposition of a constructive trust. In its memorandum of decision, filed 2 July 1975, the trial court said: “A contract purchaser holds the equitable title under the contract of sale and has a superior claim to that of a creditor of the seller who obtains a judgment against the seller after the date of the contract.

Stebbins-Anderson Co. vs Bolton, 208 Md. 185 , and cases there cited. “This is the fact