Valentine v. Austin — 34 N.Y. St. Rep. 638

Majority

p. 638

Ludlow W. Valentine, an infant, App’lt, v. Susan A. Austin and Elizabeth H. Lunt, Impl’d, Resp'ts.

(Supreme Court, General Term, Second Department,

Filed December 8, 1890.)

Headnote

1. Record—Lis pendens—Bona eide purchaser.

When a lis pendens is cancelled by order it ceases to be.notice to anyone, and those rvho subsequently deal with the title can rely on the record. They are not bound to examine the complaint in the action in which it was filed.

3. Fraudulent conveyance—Bona eide purchaser.

One R. procured a deed from plaintiff's mother by fraud and undue influence and subsequently conveyed to defendants, who took the conveyance in good faith and for value. They had a search made which disclosed a cancelled Us pendens. In an action to set the deeds aside, Heldy that defendants were bona fide purchasers.

Appeal by the plaintiff from so much of the judgment herein as dismisses the complaint as to the defendants, Austin and Lunt.

This action was brought by plaintiff, as the heir-at-law of

p. 639

■Catharine A. Valentine, deceased, to set aside a deed of certain premises from her to the defendant Eichardt, also a deed from Eichardt to the defendant Austin, and a mortgage from Austin to the defendant Lunt

The defendant, Austin, is a grantee from one Herman T. Eichardt, and the defendant, Lunt, is a mortgagee from Austin, of the same premises. Eichardt acquired the title to the land by fraud and undue influence from one Catharine A. Valentine. Catharine A. Valentine was sane when she made the conveyance. Both of these defendants took their conveyance in .good faith and for value.

This fact is found by the jury and also by the court at the request of the plaintiff. Ho evidence is returned, but the appeal is taken from the findings and judgment therein so far as the same dismisses the complaint upon the merits as to the defendants Austin and Lunt. The facts found destroy the plaintiff’s claim.

A purchaser in good faith and for value is one who takes without notice of any outstanding equity or lien not of record, or defect of title in any way. Simpson v. Del Hoyo, 94 N. Y., 189 .

There is no conflict in the findings. It is found-that Mrs. Valentine, by a next friend, commenced an action to set aside the Eichardt conveyance because it was obtained from her by fraud and undue influence and without consideration. This action had been dismissed “ before the plaintiff opened or offered any testimony,” ■and judgment was entered accordingly.

There was a lis pendens filed in this action. When the defendants, Austin and Lunt, took the conveyance, they caused a search to be made, and the search returned the finding of the lis pendens, and that it was cancelled by order of the court on the ■6th day of September, 1886.

The appellants claim that it was the duty of these defendants to examine the complaint in the Eichardt action and to take notice of what such an examination would disclose.

This is too stringent a rule of constructive notice. The record was clear, and while there had been a lis pendens which affected the title, it had been discharged by a judgment which the evidence does not question.

They know of no facts which should have put them upon inquiry and then the want of diligence is want of good faith. Parker v. Conner, 93 N. Y., 118 .

The finding of good faith is irreconcilable with this constructive notice which is claimed to have been sufficient to put the parties on inquiry.

The cancelled Us pendens was not notice except in the action in which it was filed, and all who dealt with the title while it was in force would be deemed bound equally as if they were parties to the action. Lamont v. Cheshire, 65 N. Y., 30 .

When the Us pendens -was cancelled by order it ceased to be notice to any one and those who subsequently dealt with the title could rely upon the record. They were not bound to examine the complaint in an action which, from the record, had no basis.

p. 640

The judgment should therefore he affirmed, with costs of appeal to each respondent.

Dykman, J., concurs; Pratt, J., not sitting.