Lash v. Hardick

14 F. Cas. 1161, 5 Dill. 505, 24 Int. Rev. Rec. 53, 1878 U.S. App. LEXIS 1907

• Court: U.S. Circuit Court for the District of Minnesota
• Decided: January 29, 1878
• Status: Published

Opinion

NELSON, District Judge.

It would seem, from the above facts, that the bank has sustained its defence to the bill of complaint, unless there was sufficient notice to put it upon inquiry which would have furnished information respecting the true condition of the property. The registry law is intended to give information to persons, dealing with real estate relating to transfers and incumbrances, and for their protection from secret conveyances. Patterson v. De La Ronde, 8 Wall. [75 U. S.] 300. The record did not show title out of Turrell when the judgment was docketed, and the bank can rely upon the knowledge obtained therefrom.

If, however, it had actual notice, or its equivalent, of the existence of the deed from Turrill to Mrs. Hardick, nothing can be claimed by virtue of its judgment, for equity would give no better title than Turrell possessed. Actual notice before the docket entry is not asserted. The record of this mortgage was not constructive notice of title out of Turrell (Mills v. Smith, Id. 27), and the bank, having traced title to him out of whom the registry did not carry it, was not required to look further for protection.

The statute (Rev. St. Minn. p. 330, § 21) enacts that an unrecorded mortgage “shall be void as against any subsequent purchaser in good faith, and for a valuable consideration, of the same real estate, or any portion thereof, whose conveyance is first duly recorded, or as against any attachment levied thereon, or any judgment lawfully obtained at the suit of any party against the person in whose name the title to such land appears of record, prior to the recording of such conveyance.”

This act protects judgment creditors, as bona fide purchasers for a valuable consideration, whose liens arise while the record title appears in the judgment debtor, although in fact he may have conveyed the property. Greenleaf v. Edes, 2 Minn. 272 (Gil. 226). The bank is, by the statute, placed on an equality with bona fide purchasers,' and is governed by the same rule. Lamberton v. Bank (Minn.) 2 N. W. Rep. (O. S.) 56.

The proceedings subsequent to the entry of judgment, and the title, when completed by a sale, relate back, and the time of purchase becomes as of the date of the docket entry. It cannot be doubted that a bona fide purchaser for a valuable consideration, without notice, having a deed from Turrell executed subsequent to the unrecorded deed of Mrs. Hardick, would hold the property if his deed was put on record; and equally can the bank, unless the facts proved in regard to the possession of Mrs. Hardick, through Johnson, the lessee, make it fraudulent to insist upon its judgment to the prejudice of Lash. . There was no open, notorious, and exclusive possession at the time the judgment was docketed, December 28th, 1876, sufficient to warn any person, or suggest any inquiry into the condition of the title, and no greater consideration can be claimed, on account of neglect to make inquiry, than if it had been made and the facts ascertained. The possession of Mrs. Hardick of the property in controversy, after the unrecorded deed to her from Turrell, was in no manner different or changed from what it had been before. She lived on the adjoining tract. Now, she had moved out of the state, and a trespasser was the only person residing on the land. Johnson, the lessee, lived two miles distant, and his possession was not so exclusive and of such public notoriety that it could be readily ascertained by those seeing the property. At the time of the entry of the judgment, and thereafter, the visible condition of the property was not inconsistent with the record title in Turrell.

It is admitted that after the docket entry of the judgment against Turrell, and before the execution was levied by the sheriff, the bank, through its cashier, had notice from Turrell, by letter, that he had made a conveyance of the property in 1871 to Mrs. Hardick, but this fact cannot affect the right secured by the statute. No principle of estoppel can be applied. The bank obtained its judgment in good faith, and the statute gives it a priority. To deprive it of this legal advantage by notice of an unrecorded deed after the lien attached, would nullify the statute, and a judgment creditor would not fare as well as a bona fide purchaser without notice.

Decree will be entered dismissing the bill as to the bank. Decree accordingly.

[Authorities consulted: 23 Me. 246; [U. S. v. The Watchful] 6 Wall. [73 U. S.] 91; 2 Minn. 264 (Gil. 226), 2 N. W. Rep. (O. S.) 56; [Mills v. Smith] 8 Wall. [75 U. S.] 27, 300; 64 N. Y. 76; 2 Lead. Cas. Eq. pt. 1, 187; 23 Pa. St. 110; 5 Me. 148; 1 Gilman, 187; 15 N. Y. 354; [Landes v. Brant] 10 How. [51 U. S.] 348; [Lea v. Polk Co. Copper Co.] 21 How. [62 U. S.] 495; [Hughes v. U. S.] 4 Wall. [71 U. S.] 232; 3 Pick. 149; 18 Cal. 359; 25 Wis. 70; 20 N. Y. 402; 23 Me. 170; 8 Me. 94; 20 Wis. 520; 32 N. H. 384; 12 Wright [48 Pa. St.] 238; 22 Mo. 455; 24 Miss. 106; 65 N. Y. 30; 27 Ill. 210.] ²

2 [From 24 Int. Rev. Rec. 53.]