vendee has an equitable estate in the land bargained and sold, at the time the contract is entered into. This proposition is, we believe, supported by reason and by the weight of authority."7

If specific performance of the contract of sale is not possible and there is no conversion, what interest, if any, in the property has the purchaser?

If the purchaser has paid his full purchase money and has performed his part of the contract, though he cannot have the property, he has a lien for all the money paid,-why? Because the money was advanced upon the faith of the land, the subject of the contract.18 If, on the other hand, the purchaser has only paid part of the purchase money and has performed his part of the contract, though he cannot have the land, he has a lien pro tanto for the money paid, why? Because the money was advanced upon the faith of the land, the subject of the contract.19

It has been said that the purchaser not only gets a lien on the land for the amount of purchase money paid, but, in addition, he gets a lien on the land as security for the performance of the vendor's obligation to carry out the contract.20 This proposition we do not believe to be tenable.21

17 Paine v. Meller, 6 Ves. 349 (1801); Edwards v. West, 7 Ch. D. 858, 862 (1878); Eastern Counties Ry. Co. v. Hawkes, 5 H. L. Cas. 331, 377 (1855); Secombe et al. v. Steele, 20 How. (U. S.) 94, 103 (1857); Lewis v. Hawkins, 23 Wall. (U. S.) 119 (1874); Laughlin v. North Wisconsin Lumber Co., 176 Fed. 772 (1910); Howard v. Linnhaven Orchard Co., 228 Fed. 523 (1913).

18 Rose v. Watson, 10 H. L. Cas. 672, 682 (1864).

19 Ibid.

20 See POMEROY'S EQUITY JURISPRUDENCE, § 1263.

21 We fail to find adjudicated cases in England or the United States which allow the vendee a lien on the vendor's land as security for the vendor's performing his obligations under the contract (doctrine laid down by POMEROY'S EQUITY JURISPRUDENCE, § 1263), although many cases properly, we think, allow a lien by the vendee for the purchase money paid.

If the vendee is without fault and the vendor is at fault and will not or cannot convey, then the vendee may bring an action in equity for a foreclosure of his lien, pro tanto, on the land for the amount paid pursuant to the contract (Rose v. Watson, 10 H. L. Cas., 672 (1864); Elterman v. Hyman, 192 N. Y. 113, 84 N. E. 937 (1908)). The commencement of such an action is not a rescission of the contract of sale, but an affirmance thereof. (Elterman v. Hyman, 192 N. Y. 113, 84 N. E. 937 (1908); Davis v. Rosenzweig Realty Co., 192 N. Y. 128, 84 N. E. 943 (1908).)

The difficulties in the way of allowing the vendee a lien on the vendor's land as security for the vendor's performing his obligations under the contract (see POMEROY'S EQUITY JURISPRUDENCE, § 1263) seem to us insurmountable.

Since the vendee's lien for the amounts paid pursuant to the contract is implied in

A receiver takes the property subject to any liens, charges, or equitable interests which exist, against the same,22 for "Equity will not merely enforce the execution of a trust against the trustees themselves, but against all persons who obtain possession of the property affected by the trust, provided they had notice of the trust." 23

If the vendee has paid the full purchase price and done all things agreed by him to be done under the contract of sale to entitle him to a conveyance, and the contract is such a one as can be specifically performed, then he has the full equitable title, and the vendor has the mere naked title in trust for the vendee, the vendor having no beneficial interest therein. A vendee in such a situation, it would seem, should sue the original vendor for specific performance of the contract, making the receiver a codefendant by permission equity and depends upon the contract, then the vendee loses his lien if he treats the contract as rescinded (Davis v. Rosenzweig Realty Co., 192 N. Y. 128, 84 N. E. 943 (1908)). Even if this lien for the definite amounts paid may be created independent of the contract (Davis v. Rosenzweig Realty Co., 192 N. Y. 128, 84 N. E. 943 (1908), dissenting opinion), it is another thing to ask equity to impress a lien on the vendor's land or real estate as security for the vendor's performing his obligations.

If we are to insist upon a lien on the land as security for the performance of the obligations of the vendor, when does that lien attach? If it attaches when the contract is made, it must attach under the contract, or as resulting from the contract, or implied in equity from the unexpressed understandings of the parties. But by the contract the parties agree to perform and not to break, and how can equity imply an agreement for a lien covering damages or compensation for failure to perform, when, in fact, the parties actually agree to perform? It is a different thing if, in addition to making the contract, the vendee pays part of the purchase price; then equity may well imply a new agreement by the vendor to give the vendee an interest in the land equal to the payment.

Courts of equity do not, we believe, imply a lien as security for indefinite damages, either in favor of a vendor or a vendee of land. See Brawley v. Catron, 8 Leigh (Va.), 522 (1837); Barlow v. Delany, 36 Fed. 577 (1888). Says Mr. Pomeroy in regard to the vendor's lien: "There must be a certain, ascertained, absolute debt owing for the purchase price; the lien does not exist in behalf of any uncertain, contingent or unliquidated demand." (POMEROY'S EQUITY JURISPRUDENCE, § 1251.) We believe the same statement may be made with even greater force with reference to the vendee's lien.

The reason why a vendor and vendee of real estate may frequently be given special consideration by courts of equity is that land or real estate cannot ordinarily be duplicated. If, however, the vendee admits or treats the contract as broken or rescinded, then he admits he cannot enforce a right to the property itself. He may have a claim and lien for amounts paid, but as to damages for breach of the contract, which the courts of equity cannot enforce, why should he be in a better or worse position than any other party to a contract which has been breached by the other side? 22 Black v. Manhattan Trust Co., 213 Fed. 692 (1914).

23 Pooley v. Budd, 14 Beav. 34, 44 (1851).

of the appointing court, because, by the appointment of an equitable receiver, such a vendor, whether a natural person or a corporation, would not lose the power to make a conveyance nor lose the right to sue or be sued.

If the plaintiffs to the receivership suit have no lien, equitable or other interest in such property, then the vendee, by intervention in the receivership suit, may ask that such property be released from the order appointing the receiver. If, however, the plaintiffs in the receivership case claim an interest in this property, by lien or otherwise, the court may refuse to release such property from the order appointing the receiver. In such a case the vendee, first having the equitable title, then having acquired the legal title through his suit for specific performance against the vendor, would hold the legal and beneficial title subject to the claims of the parties to the receivership suit, which claims could be worked out through the intervention proceedings of the vendee or by separate suit against the receiver with the court's permission, or by separate suit by the receiver against the vendee, as the situation might warrant.

It may be that the vendee has paid only part of the purchase money; in such a case, the property is taken by the receiver subject to the lien or equitable interest of the vendee, as indicated above. If the time has arrived for his tendering the balance of the purchase price, the vendee, having a lien and a beneficial interest in the property and a right to the legal title by tendering the purchase price,24 may sue the vendor for specific performance and make the receiver, by permission, a codefendant. In such a situation, it would not be safe for the vendee to pay the balance of the purchase price to the vendor, particularly if the order appointing the receiver ordered the receiver to collect all claims, debts, dues, choses in action, etc., outstanding. It would then be the duty of the vendee, upon proper court order, upon receiving a conveyance from the vendor, to pay over the money to the receiver. The court appointing the receiver may or may not release the property, depending upon whether or not the plaintiffs or others claim interests or liens in the same.

Such cases are analogous to the cases wherein a party makes a contract to convey land and dies. The land, by the doctrine of equitable conversion, is considered, at the decease of the vendor, 24 Reeves v. Kimball, 40 N. Y. 299, 305 (1869).

as personalty and goes to his executor or administrator. The vendee sues the heirs to recover the legal title, because they have the legal title, and joins the executor or administrator as parties defendants, because they are entitled to receive the money.

If the situation is such that the vendee's contract could not be specifically performed, then the vendee must fall back on his lien for purchase money paid and work out his claim for breach of contract like any other claimant.

(2) Rights of Vendor

When an agreement is entered into to convey land, and the property of the vendee is taken into possession by a receiver, under orders of court, what are the rights and remedies of the vendor if he is ready and willing to perform his contract to convey? If the vendee has a right to specific performance of his contract against the vendor, and the contract is mutual, it follows as a corollary that the vendor has a right to specific performance of the contract against the vendee.25 Some cases say the vendee is trustee for the purchase money.26 As against this proposition, it is often said that the vendor may be compensated by a suit in damages for the failure of the vendee to take his property. In answer to this, however, it may be said that such compensation might not be an adequate remedy, that the amount of damage given by a jury might not be the purchase price agreed upon between the parties. In addition to this, the vendor has a right, by contract, to transfer the burdens and liabilities of his property to the vendee.

25 Eastern Counties Railway Co. v. Hawkes, 5 H. L. Cas. 331, 359 (1855); Old Colony Ry. Corp. v. Evans, 6 Gray (Mass.), 25 (1856); Staples v. Mullen, 196 Mass. 132, 133 (1907), 81 N. E. 877; Maryland Clay Co. v. Simpers, 96 Md. 1, 7, 53 Atl. 424 (1902); Raymond v. San Gabriel Val. Land & W. Co. 53 Fed. 883 (1893).

26 Green v. Smith, 1 Atk. 572 (1738); Pollexfen v. Moore, 3 Atk. 272 (1745); Toft v. Stephenson, 7 Hare, 1 (1848). Mr. Langdell, in his BRIEF SURVEY OF EQUITY JURISPRUDENCE, page 380, tells us that "it is impossible that the purchaser should own the money, either at law or in equity, while it remains in the hands of the purchaser, or that the purchaser should hold any specified money in trust for the seller as such"; that the money is not identified.

If the contract is mutual, we see no reason why the vendor should not have a claim on the purchase money, provided the money or funds have been segregated, set apart and earmarked. Money may be earmarked (Taylor v. Plumer, 3 M. & S. 562, 575 (1815); Ex parte Cooke, re Strachan, 4 Ch. D. 123, 128 (1876)), and the vendee may have divested himself of the whole beneficial interest in a way which could be unmistakably shown. Fourth Street Bank v. Yardley, 165 U. S. 634, 644 (1897).

There are two situations which might present themselves in connection with the rights of vendors in receivership: First, when the vendee has paid the full purchase price. In such a case the vendor, desiring to get rid of his real estate, should sue the vendee for specific performance of the contract, joining the receiver as codefendant by permission of the appointing court. The vendee, whose property is in the hands of the receiver, whether a natural person or a corporation not yet dissolved, has still the power to sue and be sued and to hold property. The vendor, to protect himself in such case, should ask that the receiver be authorized to receive this property; however, the vendor has not a right to have the property forced on the receiver; if burdensome, the court appointing the receiver may refuse to incorporate it in the receivership property.

A second situation may present itself wherein the vendee, whose property is in the hands of the receiver, has paid but part of the purchase price. In such case, the vendor, if ready and willing to convey, may sue the vendee for specific performance of the contract and by permission join the receiver as codefendant because the vendee, by reason of the appointment of a receiver, has not lost his power to sue or be sued, and the vendee may not be insolvent and may not have parted with all his property. The receiver, by taking over the property of the vendee, cannot be compelled to carry out the contracts of the vendee,27 unless the vendor has an actual equitable interest in certain specified and segregated funds. Funds have not ordinarily the earmarks of real estate, but it is possible to have an equity in funds in the hands of the receiver, if it can be shown that the vendee has given up his absolute ownership of such funds and actually passed a beneficial equitable interest to the vendor.28 If, however, the receiver believes, by carrying out such contracts, he will benefit the estate, he may ask for an order to carry out such contracts, whether or not the vendor has an actual equitable interest in the funds. If the receiver has not sufficient or no money in his possession belonging to the vendee, he cannot carry out such a contract to purchase land without bor27 In re Oak Pits Colliery Co., 21 Ch. D. 322, 330 (1882); Quincy, etc. R. R. Co. v. Humphries, 145 U. S. 82 (1891).

28. Re Hallett's Estate, 13 Ch. D. 696 (1879). See Hurley v. Atchison, Topeka & Santa Fé Ry., 153 Fed. 503 (1907), affirmed in 213 U. S. 126 (1909). See note 26, supra.