Whitney v. Heywood

60 Mass. 82, 6 Allen 82

Opinion

Dewey, J.

This court has recently decided,

* that upon the removal of the mortgagor of personal property, after the mortgage has been once duly recorded, no additional or further record is required by reason of such removal.

2. As to the question of an authority vested in the mortgagee, to sell the mortgaged property, and to pass a good title to the purchaser, it is to be observed, that the vendee of personal property, when he sets up title in himself by purchase, in defence, necessarily assumes the burden of establishing a title or authority to sell in his vendor. It is not enough to show, that the party with whom he dealt had the actual possession of the property. Such vendor may be a trustee, intrusted with the property by the owner, with authority to use the same for a temporary purpose. In the present case, the plaintiff shows his title to the property by a duly recorded mortgage of the same from a party conceded to be the owner. Such mortgage vests the title in the plaintiff, and divests the mortgagor of all power to sell, without the assent of the mortgagee.

If this point was to be settled upon the effect resulting from the mortgage itself, the defendant must fail in the attempt to establish a title in his vendor, or any authority remaining in him to sell the property. The defendant, however, relies upon a further stipulation, indorsed upon the mortgage, in relation to sales and exchanges of the property, and authorizing the mortgagor to make such sales and exchanges upon certain conditions therein stated. It does not appear, whether this was recorded - with the mortgage, nor is it material. If recorded as a part of the mortgage, then it is to be taken with all its limitations and conditions. If not so recorded, then the record exhibits a naked mortgage, which divested the mortgagor of all authority to sell the property, as against the mortgagee, leaving in the mortgagor only an equity of redemption.

We are thus brought to the consideration of the effect of this additional agreement appended to the mortgage. Was it an authority to sell generally, or was it merely a conditional authority, the condition of which was to be fully performed, before the title of the mortgagee would be divested ? In our opinion, it was the latter, and gave no authority to the mortgagor, to divest the interest of the mortgagee, "but upon the performance of the conditions stated in the writing. This clearly results from the terms of the agreement, and would obviously be true as between the mortgagor and mortgagee ; and we think the same principle must apply to one claiming as a purchaser under the mortgagor. Such purchaser, if he had knowledge of this agreement, knew all its qualifications and conditions precedent, and was therefore properly bound by them. If he had no such knowledge of the existence of this stipulation, then he bought the property while under a mortgage to the plaintiff duly recorded, and of course is to be taken to have known that his vendor had no right to sell.

3. The remaining question is one of more difficulty, and Upon which there has not been entire uniformity in the reported cases. The defendant having offered one Kingsley as a witness, the plaintiff objected to his competency, upon the ground, that he was the vendor of this property to the defendant, and the witness was thereupon rejected as incompetent. Was this rejection erroneous ? In considering the question as to the competency or incompetency of this witness, we shall assume that he was the vendor of the property. There was evidence, from which the court below was well authorized to find that fact, and it was a matter properly to be passed upon by the presiding judge, and is now to be treated as sufficiently established. But the farther inquiry is, does the fact, that the witness was the vendor of the property, the title to which is the subject in controversy, render him incompetent, he having no release from the vendee ? The rule we take to be well settled, that the witness must be directly interested in the event of the suit, and not merely interested in the question. The true test of the interest of the witness, as stated by Green-leaf, in his treatise on evidence, (1 Greenl. Ev. § 390,) is “ that he will either gain or lose by the direct legal operation and effect of the judgment, or that the record will be legal evidence for or against him, in some other action.”

Had the witness that relation to this case ? A warrantor of title is incompetent as a witness, to support such title, without a release. ' Is this vendor such warrantor ? It is not necessary, that the warranty should be express; it may be implied. The vendor of goods in possession, and selling them as his own, is liable to his vendee upon the implied warranty of title. The principle is usually stated under this limitation of a vendor in possession, and I taire it, properly so. But possession here must be taken in its broadest sense, and as including possession by a bailee of the vendor. The excepted cases must be substantially cases of sales of the mere naked interest of persons having no possession, actual or constructive ; and in such cases no warranty of title is implied. The present ease discloses no facts tending to bring it within this exception. So far as disclosed, it is the ordinary case of a sale of property.

If the defendant intended to place his case upon that ground, a» he takes his exceptions to the ruling excluding the witness, it should clearly appear that the vendor was not in possession, and that there was no evidence to authorize the presiding judge to find, that the witness was a warrantor of the title, We think he must now be taken to have sold the property with warranty, and standing in this relation to the case, he was not competent as a witness, inasmuch as a verdict against the defendant would be evidence against him, as to the damages sustained by the failure of title warranted. If proper notice had been given to the witness, and an opportunity afforded him to take upon himself the defence of this action, the witness would be farther bound by the verdict as to the question of title. But without such notice, he would be interested in the question of damages recovered.

Upon the argument of the case, it was also objected, that this question of the competency was waived, by not taking the objection before the magistrate, who took the deposition of Kingsley. This position is, we think, wholly untenable. It was not necessary that the objection should be thus taken. If the witness was interested, the party taking the deposition should see that the interest is discharged by a proper release, before talcing the deposition.

Exceptions overruled.

Brigham v. Weaver, in Middlesex, post, 298.