American Mortgage Co. v. Hutchinson

24 P. 515, 19 Or. 334, 1890 Ore. LEXIS 53
Oregon Supreme Court·Decided June 10, 1890·Published·Cited by 13 cases

Opinion

Thayer, C. J.,

delivered the opinion of the court.

The circuit court erred in trying the case after having set aside the verdict of the jury. It has no authority to try any action at law unless a jury trial is waived in the manner provided in the Civil Code. If the court had deemed it its duty to determine the case in favor of the respondent upon the law, it should have directed a verdict in favor of the respondent at the trial. As the case stands this court has no alternative but to reverse the judgment and remand the cause for a new trial. This is sufficient to dispose of the case so far as this court is concerned; but as it must go back for a new trial, it becomes our duty to declare the law applicable to the matters involved. The question presented is whether a conveyance of real property, not recorded as provided in title I of chapter XXI, [341] Ann. Code, is void as against a subsequent purchaser of the same property whose conveyance is first recorded, where the purchase is by quit-claim deed and there is no evidence, aside from the record, showing the subsequent purchaser to have been a purchaser in good faith and for a valuable consideration, and whether the execution of a mere quit-claim deed to real property by a grantor who had previously conveyed it by deed to another grantee, but which deed was not recorded at the time of the execution of the quit-claim deed, constitutes a conveyance of “the same real property.”

Counsel for respondent virtually concedes that a purchaser under a quit-claim deed takes subject to outstanding equities in the property existing at the time of the purchase whether the purchaser had knowledge of them or not; but he contends that such a deed, under the recording act, stands upon the same footing as other forms of conveyance, and, if first recorded, is as effectual to annul a prior unrecorded deed to the same property.

The question has given rise to much deliberation on the part of courts, and earnest discussion among law writers, though it is generally conceded that a grantee in a mere quit-claim deed acquires no right against outstanding equities which were valid against his grantor. Postel v. Palmer, 71 Iowa, 157; Martin v. Morris, 62 Wis. 418. Such also is the doctrine of the supreme court of the United States and of the courts of this State, as will be seen by a reference to the authorities cited in the appellants’ brief herein; but it is claimed by many that such a deed effectually destroys the right of a grantee under a prior deed not recorded as required by the registry act, although it would not affect a prior equity in his favor which was binding upon the grantor. This, to my mind, is a somewhat strange view. Why the rights of the grantee under the prior deed should be cut off when a charge upon the property created in his favor by the grantor would not be, seems remarkable. It may be said that the prior grantee had the right to, and should have put his deed upon record; but it may, with as [342] much reason, be said that he should haye had the charge upon the property put in a form that would haye entitled it to be recorded, and had it so done. The claim, it seems to me, amounts to this: If the owner of real property were to create a trust .against it, in favor of another, and then execute a quit-claim deed to the property to a third person, it would not affect the trust, although the grantee in the quit-claim deed had no knowledge of it; but if he had executed a deed outright to the cestui que trust, and then quit-claimed his interest in the property to a third person, and the prior deed not have been recorded, the rights of the grantee in the prior deed would be lost. According to that kind of logic the grantee in the prior deed would have a better standing in such a case if his deed were not witnessed or acknowledged so as to entitle it to be recorded; as he would then clearly have an outstanding equity which would be shielded from the effects of the quit-claim deed. The form of the deed under which the respondent claims title herein is not set out in the stipulation further than it is stated to be a quit-claim deed. We must, therefore, infer that it is a remise, release and quit-claim of the right, title and interest of the grantor in and to the property in suit. It did not purport to convey the property to the grantee, it only conveyed to him such right as the grantor might have therein; and it would be difficult to perceive how the former could have expected to acquire any right in the premises unless the latter might own an interest in them. The terms of the deed were satisfied whether the grantor was owner of the property in fee or had no estate whatever in it. The grantee bargained for no quantity or quality of estate; he bought whatever the grantor might have, be the same more or less; and I do not see what legerdemain could be resorted to which would vest him with an interest that the grantor had previously divested himself of, and was then owned by a third party.

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American Mortgage Co. v. Hutchinson, 24 P. 515, 19 Or. 334, 1890 Ore. LEXIS 53 (Or. 1890).

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