Jackson ex dem. Gilbert v. Burgott — 10 Johns. 457

Majority

p. 463

Jackson, ex dem. Gilbert, against Burgott.

NEWYORK,

Oct. 1813.

Headnote

Where a Sub-chaser^E deei1 is reKiitereu, has notice, at the purchase, of a tetedU<ieui'iS" the prior deed will have the preference i purchase,with n°tll;¡! 1101 i.< e deed, being deemed Irandulent: -md o^nXe^uid fyav-'\ is. tos-court of jaw, comt of c!piit ty*

THIS was an action of ejectment for lot No. 78. in the town of Virgil, in Cortlandt county. It was tried at the Ctirtlandt circuit, before Mr. Justice Spencer, the 18th of June, 1813. 9

. . . Both parties claimed to derive title from Ananias Conkling.

The plaintiff gave in evidence a deed of bargain and sale dated the 2d May, 1796, from Ananias Conkling to James Irwin, for 500 acres of lot No. 78. in Virgil, for the consideration of 48GZ. ® The deed contained full covenants and a warranty, and was recorded the 2d March, 1812; also a release from Irwin to Ezekiel Gilbert, the lessor, dated 17th November, 1804, recorded 30th August, 1805, conveying all his estate, right and title in and to .. the lot m question.

The defendant gave in evidence a deed from Ananias Conk-ling to Samuel Tiffany, dated 25th November, 1804, and recorded 26th November, 1804, by which, for the consideration of 100 dollars, he bargained, sold, released, and forever quitclaimed all his right, title, &c. to the said lot, to 2’. and his heirs. The

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plaintiff’s Counsel objected that this deed was a nullity, and ought to have no effect whatever, as the grantor had nothing in the premises at the time, which he could convey; and the question as to the operation and effect of the deed was reserved by the judge.

To impeach the validity of the deed, the plaintiff produced J. Towser, a witness, who stated that about the 2d November, 1804, Irwin told the witness that he had conveyed the lot in question to Gilbert; that he had been misused, and requested the witness to prevail on A. Conkling, his father-in-law, to give a quitclaim deed of the same lot to Tiffany. The witness asked Irwin if he did not chink Gilbert would get his deed first recorded, and Irwin answered, that as Gilbert was an infirm man, he thought he would not. The next day Irwin and Tiffany, with Porter and Jones, came to the house of the witness for a deed, and Tiffany brought a deed ready drawn for Conkling to execute, and paid a sum of money, which Irwin furnished, and gave his note for the balance, of the consideration to Conkling, who, at first, refused to take it, but Irwin telling him that he would see it paid, he accepted it. Tiffany at that time worked as a hired man for Irwin on his farm. When the note became due the witness called on Tiffany for payment, who said the money was to come from Irwin, who was absent,

The defendant then gave in evidence a deed of bargain and sale and quitclaim for the lot in question, dated 22d January, 1807, and recorded 7th November, 1898, from Tiffany to Noah Murray, his heirs and assigns. And Murray, being called as a witness by the plaintiff, testified that Tiffany, at the time he gave the deed, was in the employ of Irwin, and conveyed the lot, at the instance of Irwin, to enable him (Murray) to settle for Irwin a debt due from Irwin in Cayuga county. But this object having failed, Irwin directed the witness to sell the lot for the bestprice he could obtain. The witness gave no consideration for the lot, and afterwards sold it to Walter Hunt, and accounted to Irwin for the proceeds of the sale. The defendant gave in evidence a deed from Murray to Thomas Butler for the north half of the lot, dated 21st October, 1808, recorded 7th November following, and a like deed of the same date from Murray to Walter Hunt for the south half of the lot, which Was recorded 5th February, 1811.

Murray being again examined, stated that he negotiated the sale of the whole Jot to Hunt, who requested Butler to join with him k

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0?.c purchase, and the deeds were accordingly made to each one for his half of the lot.

The defendant then gave in evidence a deed from Hunt to him, dated llih August, 1309, for the whole of lot No. 78. for the consideration of 3,500 dollars. A witness testified that when Hunt and the defendant were in treaty for the sale and purchase of the premises, D. Throop told the defendant that Gilbert (the lessor) had a claim, and advised him to search the records. The defendant, as he said, searched the records, but found no deed from Conkling to Irwin, and Throop then said, if he could find no such deed on record, he might buy with safety.

Throop deposed that when Hunt was negotiating with Murray for the purchase of the lot in question,- he, the witness, was informed, though not from Gilbert, that it was the same lot which he claimed, and the witness told Hunt that Gilbert (the lessor) had title to the lot, and that he had better be cautious about the purchase. The witness communicated to Gilbert the facts as to the purchase by Hunt, and received a letter from Gilbert stating that he had a good title without any defect, except that his deed had not been recorded in time. Afterwards, when the defendant was about purchasing the lot from Hunt, the witness called on Hunt and read to him the letter from Gilbert; and he also told the defendant that he had received such a letter from Gilbert, and mentioned its contents to the defendant, and cautioned him not to buy of Hunt, as Gilbert had the true title.

A verdict was taken for the plaintiff, by consent, subject to the opinion of the court, as to the sufficiency of notice to the defendant of the title of the lessor of the plaintiff.

The case was submitted to the court without argument.

delivered the opinion of the hourh The points ■submitted to the court, on the part of the defendant, in opposition to the plaintiff’s claim of title are,

1. That the deed first registered must, at all events, prevail against an unregistered deed; the statute having declared the latter, as against the former, fraudulent and void.

2. That the defendant was a bona fide purchaser without notice.

3. That if he had notice, the lessor of the plaintiff cannot avail himself of that fact, in a court of law.

■ Neither of these objections appear to be well founded-

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1. The facts in the case establish the conclusion that the de» fendant and every other person, through whom he derived title, had, at the time of their purchase, actual notice of the prior conveyance to Irwin Sr Gilbert. The purchase of Tiffany had every appearance of a gross fraud. Conkling had, as early as 1796, sold the lot to Irwin, for the consideration of 480Z. or 1,200 dollars ; and in 1804, he gave a quitclaim deed, of the same lot, to Tiffa~ ny, for the consideration of 100 dollars. It appears that Tiffany was a hired man in the service of Irwin, and the purchase was effected at the instance of Irwin, for the avowed purpose of defeating the operation of a deed he had previously given to the lessor of the plaintiff. Irwin furnished the money, and Tiffany was only a nominal trustee to Irwin, and the instrument of his fraud. The next conveyance in the chain of the defendant’s title, is the deed from Tiffany to Murray; but as Murray purchased at the. instance of Irwin, and gave no consideration, he was not a purchaser for a valuable consideration within the act, and was also a mere nominal trustee for Irwin. The next conveyance was from Murray to Hunt, from whom the defendant purchased. While Hunt was in negotiation with Murray for the purchase of the lot, he was informed that Gilbert, the lessor, claimed the lot, and had title, and was cautioned against purchasing. He, notwithstanding, purchased, and took a quitclaim deed, and gave a trifling consideration. And when the defendant purchased from Hunt, he was informed by a witness, that he had a letter from the lessor of the plaintiff, stating particulars, and informing him that he had.a good title without defect, except that his deed had not been recorded in season. The contents of this letter were stated to the defendant, and he was cautioned against buying of Hunt, as Gilbert was the true owner.

It ought further to be observed, that the deed from Irwin to Gilbert was recorded as early as 1805, and before even Tiffany had undertaken to sell to Murray.

These facts put the point of actual notice beyond all controversy ; and the only question is, whether these several conveyances, under which the defendant claims, and which are so infected with fraud, are to be sustained in a court of law, merely because he can show a priority of registry.

2. We have always taken it for granted, without any formal discussion, that notice would supersede the prior registry, even in

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a court of law. But as the point is now, for the first time, ciisiinctly raised in this court, it may merit some consideration.

It may be assumed as a settled principle in the English law, that where a subsequent purchaser, whose deed is registered, had notice, at the time of his purchase, of a prior registered deed, the prior deed shall have the preference; for the object of the register acts is to give notice to subsequent purchasers, and in the case stated, the object of the act is answered, and his purchase under such circumstances is a fraud. It is considered as done malafide, by assisting the original vendor to defraud the prior vendee; and the courts will not suffer a statute made to prevent fraud, to be a protection to fraud. It may often be a question, what facts or circumstances will amount to notice sufficient to charge the party; but if the fact of notice be once made out, there is no doubt in the books, but that as against such prior deed, the subsequent registered conveyance is to be adjudged fraudulent and void. This principle I apprehend to be equally just and solid, and it cannot but excite surprise that the French ordinance of 1747, compiled under the auspices of so excellent, pure, and distinguished a magistrate as Chancellor D’Aguesseau, will admit of nothing, not even of the most actual and direct notice, to countervail the prior registry. (Butler’s Note, 249. s. 11. to Co. Litt. lib. 3.^[1] ) M. Pothier does not hesitate, however, to question the policy and equity of the ordinance. (Traite des Substitutions, s. 1. 6.) The foundation of the English doctrine is the fraud of the second purchase under a knowledge of the first; and when that appears, (as it will in almost all cases where the second purchase is made with the knowledge of the first, and with a view to defeat it,) it cannot consist with the honour of the law, or with the wisdom of the administration of justice, that the fraud should remain triumphant.

’ An unregistered deed is, in no cáse, void ; it is always good as against the grantor and his heirs; and the question here is, between a valid and fraudulent deed. The case of Le Neve v. Le Neve was decided by Lord Hardrvicke in 1747, and it contains the fullest illustration, and the most decisive vindication, of the rule. (3 Atk. 646. 1 Ves. 64. Amb. 436. S. C.) Ee says that the rule was first applied to the statute of 27 Hen. VIII. far the enrolment of bargains and sales ; and that the construction had been uniform, that if a subsequent bargainee had notice of a prior bargain and sale, he was equally affected with the notice, as if the

* Folio edit. 290. b. Note (1.)

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prior purchase had been a conveyance by feoffment. When the register acts were introduced, the same rule of construction was applied to them; and to show the absolute necessity of the constraction, Lord Hardivicke supposes the case of a purchaser of lands in a register county, employing an attorney to register the conveyance, who, neglecting to do it, buys the estate himself, and registers his own conveyance; and he then asks, shall this be allowed to prevail ? To allow the statute to have this effect, would be permitting it to be made the instrument of fraud, and would shock the moral sense of mankind. The same rule, as to notice# must be applied to cases arising under our acts, relative to the military bounty lands. The object of the registry, under these acts, was not only to detect fraud, but “ to prevent frauds in future and the effect of the first registry is declared in the very terms used in the statute of 7 Ann. c. 20. in cases arising under these acts, it has always been assumed as a conceded point, that notice of the prior deed would supersede the effect of the prior registry. (Jackson, ex dem. Potter, v. Hubbard, 1 Caines’ Rep. 32 . Jackson, ex dem. Humphrey, v. Given, 8 Johns. Rep. 137 .)

3. The only point that remains to be considered in this case is, whether the question of notice is not exclusively of equity cognisance.

The decisions have come from the court of chancery, but whenever the point has occurred to the judges of the courts of common law, they have always recognised the existence and solidity of the rule. (Lord Mansfield, in 1 Burr. 474. and Lord Kenyon, in Peake’s N. P. 190, 191.) And if the question of notice be a question of construction of the statute, and not merely of a trust or equity binding on the conscience, the cognisance of it must belong equally to a court of law. The design of the act was to give notice, by means of the registry, and thereby prevent imposition, mistake, and fraud. The court of exchequer, in Cheval v. Nichols, (1 Stra. 664.) admitted that the statute only intended to give such notice as would prevent fraud, and that the statute never intended io relieve a purchaser with notice, though the first deed was not registered. It is, therefore, a question on the interpretation of the registry ads, and upon every sound principle, courts of common law have cognisance of the case. - -* Courts of law and equity are equally bound to give statutes a sound interpretation, in prevention of the mischief, and are equally hound to carry the intention into effect: and courts of law have

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concurrent jurisdiction in all cases of fraud/ Fraud will invalidate, in a court of law as well as in a courlji of equity, and annul every contract and every conveyance infected with it. The ground of the interference of the courts in these cases of notice, is the fraud. In Fermor’s Case (3 Co. 77.) it was resolved that a fine levied hyt fraud was not binding, and that“ such fraudulent estate was as no estate in judgment of law,” and it was declared that all acts and deeds, judicial as well as extrajudicial, if mixed with fraud, were void. When the statute says that every deed not recorded shall be adjudged fraudulent and void against a subsequent purchaser for valuable consideration, whose deed shall be recorded, it undoubtedly meant a subsequent purchaser in good faith, and who did not purchase with a fraudulent intent. A subsequent purchaser, mala fide, was not within the purview of the^act, and not intended to be protected; for the statute never meant to give sanction to fraud, or to render a fraudulent act legal. That is impossible. Consequently, in the case of a second purchaser with notice, no estate passes to him by the deed. “ Such fraudulent estate iras no estate in judgment of law.”

Judgment for the plaintiff.