Shepherd v. Burkhalter

¶1By the Court.

¶2delivering the opinion.

¶3This is a contest between a purchaser, claiming land by virtue of a Sheriff’s sale, under certain Common Law fi. fas. and the plaintiffs in a mortgage fi. fa. issued against the same land, and it involves a question of priority of lien.

¶4The date of the mortgage is prior to that of the fi. fas. but the claimant insists that it was not recorded within the time prescribed by law, nor foreclosed before the Common Law judgments against the mortgagor were obtained, and that the latter consequently gains a preference.

¶5To this it is objected, that the purchaser had notice of the mortgage, though it was not recorded ; that the land in question was sold by the Sheriff, subject to the mortgage, and that it was in fact recorded.

¶6The provisions of our Statute law on the subject of recording mortgages of land are as follows:

¶7The 2d section of the Act of 1827, requires that all deeds of mortgage upon real property, “ shall be recorded in the Clerk’s office, &c. within three months from the date of such deed. ” The 4th section provides, that “ upon failure to record any mortgage, as hereinbefore required, within the time or times hereinbefore specified for recording the same, that *447then and in such case, all judgments obtained before the foreclosure of the said mortgage, and also any mortgage executed after the same, and duly recorded, shall take lien on the said mortgaged property in preference to 'the said mortgage.”

¶8[1.] In view of the terms of this Statute, it is our opinion (especially in the absence of proof affecting the conscience of the judgment creditor AYith notice) that if the mortgage in this case YYere not recorded in time, the lien of these judgments obtained in the Justices’ Court, attached to the land; and when it was sold under and by virtue of this lien, the purchaser, whether he had notice of the unrecorded mortgage or not, took the interest which was sold, viz : the estate of the judgment creditor in the land, and quoad that interest in the estate, must be subrogated to the rights of the creditor.

¶9[2.] The notice given by the mortgagor, Wells, at the Sheriff’s sale, and the proclamation made by the Sheriff, in consequence, that he sold the land subject to the mortgage, cannot affect this view of the case ;.for the reason, that the Sheriff sold the interest of the judgment creditor, whatever that was, when he sold subject to the mortgage ; and if that interest was a priority of lien upon the land, to the extent of that lien it was superior, of course, to the interest of the mortgagee. In such case, neither the notice nor the Sheriff’s proclamation could change the law and divest the lien of the judgment; and fro tanto, the purchaser certainly took title to the property sold.

¶10By some Courts it has been held, that a deed not duly registered, is void as to creditors, with or without notice. Washington vs. Trousedale, Mart. & Yerg. 385. And that a purchaser, in behalf of the creditor, holds the rights and occupies the place of the creditor, and will not be affected by notice of an unrecorded deed. Guerrant vs. Anderson, 4 Rand. 208.

¶11The Supreme Court of Massachusetts, on the other hand, has held, that a creditor with notice .of a previous unregistered conveyance for a valuable consideration, cannot, by attachment and levy, obtain a title against the grantee. Priest vs. Rice, 1 Pick. 164.

¶12*448However this may be, there is nothing in this record which brings home notice to the creditor, and the case is not placed upon that ground.

¶13[3.] If the rights of the purchaser, in this case, were affected by notice of the unrecorded mortgage, it could only be as to so much of the mortgaged premises as exceeded in value the amount of the judgments under which the land was sold; for, as we have seen, to the extent of these judgments he takes the estate upon which their lien attached.

¶14[4.] This view is consistent with that laid down by this Court, in the ease of Neall vs. Kerrs Hope, (4 Ga. R. 161,) where it was held that a junior mortgagee with notice, gains no preference ; because in the latter case, the lien is created by the contract of a party whose conscience is affected with notice ; in the former, the creditor being unaffected with notice, the lien is created by virtue of law.

¶15[5.] Whether or not, the rights of the purchaser in this case were influenced by notice to him, as to any amount exceeding the judgments, must depend upon the evidence of notice, and so far as we are informed by the record, no such notice appears.

¶16If there were no signature of the mortgagor, Collins, upon the record hook until more than three months had elapsed from the date of the mortgage, we hold that constructive notice cannot properly bo deduced from such a record. The purchaser in such case, can bo held in reason, to have had notice from this record, only of what there appeared, viz : that an instrument was registered, which was incomplete, because lacking signature.

¶17“ It would seem,” says one of the first lawyers of our age, “ that the Courts might hold, without any violation of principle, that a purchaser should not be deemed to have notice of an equitable incumbrance, by the mere registry of it, unless it was duly registered.” Sugden, 470.

¶18Eminent Courts and Judges have so held. Chancellor Kent, for example, says in the case of Frost vs. Beckman, (1 John. Ch. R. 300,) “ that the purchaser is' not to be charged with *449notice of the contents of the mortgage, any farther than they may be contained in the registry. The purchaser is not bound to attend to the correctness of the registry. The Act, in providing that all persons might have recourse to the registry, intended that as the correct source of information.” The Chancellor goes on to say, that if the rule were otherwise, “ the registry might prove only a snare to the purchaser, and no person could bo safe in his purchase, without hunting out and inspecting the original mortgage, a task of great difficulty.”

¶19The Supreme Court of Pennsylvania holds similar doctrine, in the case of Heister vs. Fortner, (2 Binn. R. 40,) as the Supreme Court of the United States, in Hodgson vs. Butts, (3 Cranch, 155.) And this Court, in the case of Herndon et al. vs. Kimball, (7 Ga. R. 433,) has, in principle, laid down the same rule.

¶20. Though the facts of these cases are not the same with that at bar, yet the principle involved, is the same in all, viz: that -the registry is notice of the tenor and effect of the instrument recorded, only as it appears upon that record.

¶21[6.] We learned in our elementary lessons, that signing, sealing and delivering, were requisites necessary to every good deed.

¶22If, then, this instrument, as it appeared in the record, lacked a signature, (though the signature were attached to the original and omitted by mistake,) it, of course, lacked one of the essential features of the mortgage deed, and was, in this regard, no record of that mortgage, until the name of the mortgagor was placed upon the record-book. If that were not done until more than three months from the date of the mortgage, then the instrument was not duly registered in terms of our Statute.

¶23[7.] Whether or not the mortgage in question did lack the signature of the mortgagor, for more than three months from the date of its execution, was a question of fact submitted to the Jury, the evidence relating to which, we are called upon to consider, in determining whether or not the new trial was properly granted in this case. His Honor, Judge Iverson, *450granted a new trial, upon the ground that the evidence proved the deed to have lacked the signature until after the time prescribed, and that the verdict was, consequently, contrary to evidence.

¶24It is insisted for the plaintiff in error, that there was some evidence on both sides; that the endorsement of the Clerk’s certificate upon the mortgage, was prima facie evidence of its due and proper record ; and that though the weight of evidence may be against this view, still, it was the province of the Jury to determine this; that they have done so, and their verdict should not be disturbed.

¶25We concede that the certificate of the Clerk was prima facie evidence of the record; but that evidence was rebutted by two unimpeached and disinterested witnesses. John Campbell swears, that he saw the record after Burkhalter’s purchase, as he thinks ; that the signature was wanting, and that Dowd owned he had placed it there after he (Campbell) had first seen the registry. By Wiley Williams, it was proven, that Dowd admitted in his hearing, that he had omitted to copy the signature of the mortgagor upon the record-book, until after the time prescribed.

¶26When we reflect that Dowd, who furnishes the prima facie testimony, was one of the mortgagees, and thus deeply interested in securing to the mortgage validity and priority of lien; and that the testimony furnished by him is contradicted, positively and conclusively, by two witnesses, who are disinterested, (so far as we can judge from the record,) we are constrained to hold, that a case is presented for the extraordinary interposition of the Court, in arresting the verdict of a Jury, where there is some evidence on both sides; because the conclusion is authorized, that there was some improper bias, or gross misapprehension, influencing the Jury, and that, to an extent which “ shocks both the understanding and moral sense.”

¶27We will not lightly interfere with the province of the Jury to decide the facts, nor encourage others to do so. But when the case presented comes clearly within the rule above stated, *451and recognized by this Court in several cases, reason and justice make it our duty to authorize a new trial.

¶28It was stated, by the counsel for the plaintiffs in error, that the Court below, though of the opinion that he could sustain the motion for a new trial, on the first ground only, (which is the ground we have just been considering,) yet, said that, as he did have to decide against the plaintiffs in erior, he would, ex gratia, grant a new trial on all the grounds taken, that the plaintiffs might have the opportunity of excepting on all; and our opinion on all these grounds is invoked.

¶29Presenting, as the record plainly does, the judgment of the Court in granting a new trial, as based upon and solely influenced by the ground just considered, and aflirming, as we do, the judgment on that ground, we deem it unnecessary, and think that it would be going out of the record, as it were, to express our opinion on the other grounds.

¶30The judgment is affirmed.