Beekman v. Frost

18 Johns. 544 | N.Y. Sup. Ct. | 1820

Spencer, Ch. J.

The first point made by the appellant’s counsel is, that the facts stated in the bill, give the respondents no rights, as plaintiffs, in á Court of equity. It has been answered, that this objection is not now open to the appel lant, as it was never taken in the Court below. This question has frequently arisen, and it is necessary that it should now be settled in such a manner, that no future embarrassment may be experienced. The cases in this Court in which the point has been noticed, are James v. M'Kinnon, (6 Johns. Rep. 543.) Gelston v. Hoyt, (13 Johns. Rep. 562.) Sands v. Hildreth, (12 Johns. Rep. 493.) Lyon v. Tallmadge and others, (14 Johns. Rep. 501.) Palmer v. Lorillard, (16 Johns. Rep. 348.) In Chamley v. Lord Dunsany and others, (2 Sch. & Lef. 712.) Lord Eldon, in speaking of an account of personal estate which had been insisted on at the bar, as necessary to the decision of-the cause, said, it was not looked for by any one of the parties, and as the point was not made below, it could not be made by way of appeal. Lord' Ers/cine, in the same cause, (p. 719.) observed, 44 that all objection on that score is removed, because, it appears, that every one of the parties litigant, supposed such account unnecessary, and the conduct of the appellant, in making the objection here, is like that of a party w-ho would seek to set aside a verdict,- because evidence was hot given to a jury which he had in his power at the trial, and would not give.’’

Without repeating what fell from different members of this Court in the cases referred to, all of which are reconcilable, the principle to be extracted from them I believe to be this : That no party shall be allowed to surprise or mislead his adversary. Thus, if a party in the Court below, shall purposely suffer a decree or judgment to pass against him, by default, without contesting it there, he shall not be heard here; or, if counsel shall, for the first time, raise a point here, which might have been obviated, had it been made in the Court below, he ought not to be permitted to do so.

In the case of Gelston v. Hoyt, this Court refused toheaE the demurrer argued here, because the counsel had purposely declined arguing it in the Supreme Court; and had thereby deprived the plaintiff below of a right which would have been granted to him; the right of having the pleading demurred to amended, if vicious, on payment of costs; a privilege this Court could not grant. It would, in such a case, operate as a fraud, to lie by, and suffer judgment to pass by default, with the view of subsequently seizing on the same point in this Court, and impose upon the party the accumulated costs of the whole action, if the pleading demurred to was bad. Such a course of proceeding would, also, defeat the provisions of the constitution, requiring the reasons of the decree or judgment to he made known to this Court.

But where a cause has been defended in a Court below, and comes here for review, and a point is made here which could not be obviated in the Court below, by proof or amendment, I am clearly of opinion, that this Court ought not to refuse cognizance of such point. We may not, it is true, upon such point, have the reasons of the judgment in the Court below; but this consideration cannot, and ought not, to preclude this Court from entertaining such point. To those conversant with judicial discussions, it is well known, that the re-examination of a cause, before a Court of dernier resort, is admirably calculated to elicit truth, and to detect any error, whether of the counsel or Court, which may have taken place at an earlier discussion of the cause. Counsel not only come better prepared from the previous discussion, but all their faculties are put in requisition for the final and last hearing. A point decisive of the cause may have been overlooked by the counsel and the Court; a point .too, probably, grooving out of the case, which no evidence or amendment could alter or shake. Can it, then, consist with sound reason, or a sacred regard to indivdual jast*ce> ^t this Court should close its eyes, and refuse to see that which may decide a cause, because it had not been before observed? I think-not. The cases of James v. M'Kinnon, Lyon v. Tallmadge, Palmer v. Lorillard, are strong authorities in support of my position ; and they are not weakened by the other cases, if correctly understood. The case, too, of Le Guen v. Governeur and Kemble, (1 Johns. Cas. 436.) shows, that though this Court expect to be informed of the reasons of the Court below, it is not confined to those reasons. In that case, an áppeal was made from an order directing a feigned issue. This Court were of opinion; that such issue ought not to have been directed, but proceeded to hear the cause on its merits, and made a final decision. This procedure was justified by precedents in the House of Lords. There, the Chancellor had given no opinion on the merits; yet it was not cóiisider-ed an obstacle to the final hearing here. Upon- the whole, I cannot doubt the right of this Court, nor its duty, in hearing and deciding the first point how raised.

To the first point, wether the facts stated in the bill, give the respondents a right to proceed in a Court of equity, as plaintiffs, it has been answered, that the bill is substantially a bill to redeem, and that the facts set forth, and the case made out, are of equity jurisdiction, and entitle the respondents to the relief decreed. '

It is certainly an essential part of a bill to redeem a mortgage, thatit offer, in express terms, to pay the amount due, with costs. The bill usually states a prior tender of the money, and a refusal to accept it. It seems to me impossible to consider this as a bill to redeem the mortgage. Its frame and object were to obtain a decree setting aside the respondent’s mortgage for any greater amount, than the sum for which it was erroneously registered. In terms, it does not pray a redemption of the mortgage, and it omits, what I consider an all important averment, the readiness to pay whatever shall be decreed. The mortgagor, on the non-payment of the money, has a right to foreclose the equity of redemption, by a bill in equity. The proper parties being before the Court, the mórtgage and its non» payment being established, there is a decree for the payment of the principal and interest within a specified time, or in default thereof, that the mortgagor and those claiming under him be barred of their right to redeem. The mortgagor has a correspondent right to call on the mortgagee in equity, to accept his principal and interest, and costs at law, and to reconvey all his interest under the mortgage, free from incumbrances. A bill to redeem operates, in one respect, like a bill to foreclose ; for if it be dismissed, in default of payment of the money, at the time specified, it has the precise effect of a foreclosure, and is equivalent to a foreclosure. (2 Madd. 420.)

The Chancellor never treated or considered this as a bill to redeem; and if the respondents failed in complying with that part of the decree ordering, the payment of the money adjudged to be due, it does not draw after it the consequences of a foreclosure. It is an established rule in equity, that relief inconsistent with the specific relief prayed for, cannot be given, under the general prayer for relief. A bill seeking general relief, and omitting an essential requisite to constitute it a bill to redeem, cannot be so regarded, nor draw after it the consequences incident to such a bill.

The foundation of the bill is, that the respondent was taking measures to sell the mortgaged premises, under a power in the mortgage from Corl, for securing the payment of 3000 dollars, whereas, it was registered as a mortgage for 300 dollars only ; setting forth a purchase from Corl, the payment of part of the consideration, and the execution and delivery of notes for the residue. I shall consider the averment of the bill to be, that Frost and Goddard, at the time of the conveyance to them, had no knowledge of the appellant’s mortgage, and that they were bona fide purchasers.

In Patterson v. Slaughter, (Ambl. 293.) Cord Hardwicke laid down the rule to be, that the title of a purchaser, for valuable consideration is not ground for relief, though it is a good defence. No book of precedents, no treatise on equity, furnishes a case.of a bill filed on the ground that there has been purchase without notice and for valuable consideration. Lord Eldon thus explains the defence : “ the principle of the plea is this, 1 have honestly and bona j^e paj¿ for tjj¡s es(atCj jn order to make myself owner of it, ancj sjja|j jjaye no information from me, as to the perfection or imperfection of my title, until you deliver me from the peril, in which you state I have placed myself, in the article of purchasing 'bona fide.” '

If the defendant has an equal claim to the protection of a Court of equity, to defend his possession, as the plaintiff has to the assistance of the Court, to assert his right, the Court will not interfere on either side. This is the case when the defendant is a purchaser for a valuable consideration, without notice; this he may plead in bar of the suit; and the plea must always be put in upon oath. (Mitford Pl. 215.) The respondents attempt to make use of the fact of a bonajide purchase, for valuable consideration, and without notice, as a substantive ground of equity for offensive operation ; thus inverting the order of proceeding, and wholly dispensing with the essential part of what is merely a defence ; I mean the oath of the purchaser to his plea. Here there is no oath or proof of the fact, that the respondents were purchasers within the rule; for the swearing to the bill by one of the respondents, for th e purpose of an injunction, is, in no sense, the oath required to such a plea. As was to have been expected, there is no proof that the respondents had no notice of the mortgage as one for 3,000 dollars, before their purchase. In the nature of things, they could not prove that they had not notice. The appellant was entitled to have their denial of the fact of notice, and their averment that they were purchasers bona fide, and for' valuable consideration, under oath. These considerations are, I apprehend, sufficient to show that the decree cannot be sustained.

As the case has been argued at large, and as it may save litigation and expense, to have the opinion of the Court on the merits, I proceed to examine them. Should the respondents file a bill to redeem the mortgage as registered, on paying the 300 dollars, and interest and costs, the appellant must either avail himself, by answer, of the mortgage, as one for 3,000 dollars, or file his cross fbill to foreclose it as such ; the question would then arise, supposing the respondents to be bona fide purchasers without notice, what would be the rights of the parties ? This involves the third point, whether the conditions upon which the escrow was to take effect, as the appellant’s deed, have been complied with, so that the title passed to Corl. Thp conditions were, that Corl should pay the balance then due, and have the mortgage, (after executing that and the bond) put on record, and bring a certificate from the clerk that no mortgage or other incumbrances were against the lots ; Mr. Westerlo was then to deliver the appellant’s deed to Corl. The deed was delivered on proof satisfactory to the agent; but it is contended, that the condition of having the mortgage put on record was not complied with; because, there was a mistake in the registry, in recording the mortgage, as one for 30G dollars, when it was, in fact, for 3,000 dollars ; and that, therefore, the delivery of the deed was unauthorized on the part of the agent.- This condition must receive a reasonable construction. It was not an act expected to be done by Corl personally, for he had no right or power to do it; this duty entirely appertained to the clerk. It would be unnatural and unreasonable, to construe this condition in any other way, than that Corl was to deliver the mortgage to the clerk, or his deputy, to be put on record. We ought not to interpret the condition with reference to the mistake which has occurred; and it is clear that we cannot construe it literally. Had there been no mistake in the registry, can any one doubt, that the condition would have been fulfilled by CorPs delivering the mortgage to the clerk to be recorded, and that he had recorded it. It might, then, with the same force, be objected, that Corl did not personally put it on record. But, it is said, the mortgage was not recorded, in consequence of the mistake. It was recorded inaccurately; yet it was recorded, so far as respected Corl. Surely, it cannot be required of him, that he should stand by and see that the clerk does his duty. Both the appellant and Mr. Westerlo were satisfied, for a long time, that Corl had performed the condition ; • thus the appellant left in CorPs hands the evidence that he was the owner of the property, and the power to implicate third persons relying on the fact, that Corl was the owner of the land, he having the appellant’s deed for it. To insist, after such a lapse of time, as against third persons, upon the non-fulfilment of the condition, appears to me inequitable and unjust; and I, therefore, entirely concur in the opinion expressed by the Chancellor, that the deed was well delivered ; that the condition wasqperformed according to the views, expectations, and instruction of the párties ; and that it related back so as to validate the conveyance to Frost and Goddard.

I, also, agree with the Chancellor, and for the reasons he has expressed, that the respondents are not to be charged with notice of the contents of the mortgage, any further than is set forth in the register, unless actual knowledge of the mortgage is brought home to them. I consider the respondents liable for the 300 dollars, with interest, and for any balance in their hands beyond that sum, and as to which they had not' committed themselves to third persons, when they were informed of the real amount of the mortgage. I perceive no reason why they should pay the 300 dollars and interest, and, also, in addition to that, the balance in their hands, for if we admit that the registry was notice, as I think it was, to the amount of 300 dollars, the respondents have a right to say, that the sum unpaid, and in their hands, was intended to be applied towards satisfaction of the mortgage. I regret, that the bill was not so framed as to enable the Court to put an end to the controversy; but justice must be ¡ administered on established principles, and according to established forms.

The decree must be reversed, with directions to the Court of Chancery to dismiss the bill, without prejudice to the respondents’rights.

Woodworth, J.

It is objected by the respondents’ counsel, that several points not urged in the Court below, are now relied on as grounds for reversing the decree. That the cause was fully argued before' the Chancellor, ap„ pears from the report; and if it shall now appear, that the case presents important questions on the merits, to which his attention was not called, I should rather incline to believe they had escaped the researches of counsel, than that they were designedly waived or abandoned, for the purpose of bringing them, in the first instance, into view in this Court. The rule is, undoubtedly, salutary, that no party shall be permitted to pass the Court below in silence, and thereby make this a Court of original, not appellate jurisdiction ; neither will this Court listen to objections, which, if made in the Court below, might have been removed by the exercise of the ordinary powers of the Chancellor, previous to, or at the hearing. But where the justice and law of the case are intimately connected with the new points raised, and are so material, that had they occurred either to the Court or the counsel, it is evident they would have been examined, it would be a perversion of justice to deny a party the right to bring them into review when the cause is heard on appeal. In Palmer v. Lorillard, (16 Johns. Rep. 353.) it is said, “ that the rule was only intended to be applied to objections, that the party may be deemed, by his silence, to have waived, and which, when waived, still leave merits of the case to rest with the judgment. But if the foundation of the action has manifestly failed, we cannot, without shocking the common sense of justice, allow a recovery to stand.” I consider the first, second, and sixth points, raised by the appellants, as embraced by this principle, and essential to be considered, in order to arrive at a correct de« cisión.

I will examine the first and second points in connection.

The appellant contends, that the facts slated in the respondents’ bill, give them no right to proceed against the appellant, as plaintiffs, in a Court of equity; that both parties being equally innocent, and having equal equity, the bill should have been dismissed, and the parties left to their remedies at law. The scope of the respondents’ bill is to obtain relief against the appellant’s mortgage, on the ground that they are purchasers for a valuable consideration, without notice, concluding with a prayer for general reliefs The question then is, whether, according to the course of the Court of Chancery, this relief can be sought affirmatively by bill, or whether the party must not rely on it, by way of defence. If the facts charged, are only available when averred in the plea or answer, it follows they cannot form the. groun(j for a decree, when alleged in the bill» The reason js obvious; they will, in many cases, protect and shield a defendant when assailed, but they do not permit him to become the assailant. I have not met with a single case, where the allegation of being a purchaser for valuable consideration without notice, was ever deemed sufficient to decree relief against a defendant, having equal equity with the plaintiff, nor indeed to any relief whatever; although the books contain numerous cases, where the same state of facts would constitute a perfect defence. In the case of Paterson v. Slaughter, (Ambler, 292.) Lord Hardwicke recognizes this distinction ; in that case, the defendant having put in his answer, discovered that the person under whom he claimed, was a purchaser for a valuable consideration, without notice ; on petition to take the answer off the file, and put in a new answer, two methods were proposed, to give the defendant the benefit of this discovery: 1st» To file a cross bill; 2d. To put in a further answer. As to the first, the Chancellor observes, “ the title of a purchaser for valuable consideration, is not ground for relief, though it is a good defenceIf we examine this point, independent of authority, I apprehend we should arrive at the same conclusion; the material allegations in the bill are, that the plaintiffs are purchasers for a valuable consideration, without notice ; but how can a plaintiff prove the want of notice ? It is riot susceptible of proof, from the very nature of the inquiry, without resorting to the evidence of the party averring the want of notice. When he elects to become plaintiff, he cannot testify for himself; the allegations in the bill are not evidence for him ; they must be proved, or admitted, before relief can be granted. The case of a defendant in Chancery is widely different; no decree can be made against the positive denial in his answer, unless disproved by two witnesses, or by one witness and circumstances. In many respects, the defendant is viewed in the light of a witness, as well as a party. There is manifest propriety, then, in saying, that a purchaser, without notice, must act on the defensive; as a defendant, his oath, in the first instance, is competent testimony to prove the fact. He is the only person who can testify, that he had no notice; it rests within his knowledge Third persons, it is true, may state facts and circumstances which render notice improbable, but there still is better evidence resting in the bosom of the defendant, which enables him, and him only, to say he had no notice when he purchased; but the moment he quits this rampart, and becomes plaintiff, he incapacitates himself He is the only witness who can prove the fact; but, ds plaintiff he must make out his case aliunde. His shield, it is true, remains, but he has no weapons for offensive war. While defendant, his oath is sufficient, until the plaintiff charges him with notice by competent proof; but, when plaintiff, his opponent may rest on his arms, in safety, because the fact cannot be established, prima facie, so as to claim relief. If we examine the proof on behalf of the respondents, it will be seen, that as to the question whether the purchase was made without notice, we are left to conjecture. I have already shown that the oath of the respondents is not evidence; it can establish no fact, and must be rejected; if want of notice can be made out, the testimony must be derived from a different source. What, then, is the proof to support this essential part of the case ? It is derived from the testimony of Samuel Whitney, who says, “ that in the fore part of September, 1807, he discovered the mortgage in question, on record in the clerk’s office of Onondaga, and communicated the fact, immediately, to one of the sons of Martin Goddard•; and he knows, that his communication was the first notice the said Goddard, or Frost, had of the said mortgage, from the circumstance of Samuel Goddard’s going the very next day to the clerk’s office, to examine tbe records as to the fact; and, also, from the alarm they discovered, on their knowledge of its certainty. That his situation was such, that he would, in all probability, have heard of said mortgage as soon as Frost and Goddard.’’ This is the only testimony to this point; and it may serve as an illustrar tion of a preceding remark, that want of notice is a fact which can only be proved by the party denying it, and can* not be established by evidence aliunde ; if it could, in any supposable case, it cannot be pretended that this evidence amounts to any thing. The facts stated by Whitney, are not inconsistent with full knowledge previously received by Frost and Goddard. This position will be obvious from a moment’s consideration. Whitney discovered'the mortgage in September, 1807; but how does this prove that Frost and Goddard had not discovered it previously ? Whitney communicated his discovery immediately, to one of the parties; but this does not prove that it was any discovery'to Goddard; non constat, but that he knew the fact before ; but Whitney knows, that this was the first notice to Frost and Goddard; How ? Does he state a fact altogether inconsistent with previous notice to them, and on which he founds his knowledge ? No : but Goddard went the next day to the clerk’s office to examine; the answer is, he might have been informed repeatedly before, and become chargeable with notice of the existence of the mortgage, and yet not have been at the clerk’s office; fór it must be kept in mind that want of notice is not confined to the mortgage on record, but is a denial of a knowledge of the existence of the appellant’s mortgage, whether registered or unregistered. The other circumstance relied on by the witness, is the alarm they discovered. Now, the answer to this is, that neither their acts nor declarations can ever be made use of in their favour, although good evidence, if they make against them; besides, if it was contemplated that want of notice could be established by mere negative testimony, such as this,, connected with the acts of the parties, to be bene-fitted by establishing the fact, we should expect, in such a case, that their conduct and acts would correspond with the intent, and be calculated, at least, not to raise a presumption against them. The alarm, then, whether real or pretended, cannot be adduced, legally to establish any fact; for it is not susceptible of proof, any more than the want of notice itself. From the preceding considerations, I apprehend, it abundantly appears, that being a purchaser for valuable consideration, without notice, does not, of itself, form a substantive ground of relief by bill; and, secondly, that if it did, the proof offered by the respondents failed to establish the fact. For the púrpóses of justice, there is no necessity, that a party averring want of notice, should be protected, other than by way of defence. In that case, having at least equal equity with the party seeking relief, he must prevail 5 but the case assumes a different aspect, when in the character of plaintiff, he asks the interposition of the Court to restrain a party, having equal equity with himself, from proceeding at law. If the appellant can, at law, prevail against the respondents, Chancery will not disturb him, because, both parties being innocent, and the equity equal, it will not interfere. Whether the appellant can have a perfect remedy at law, is not the inquiry. We leave the parties to contest their rights at law, without, the restraint or interposition of a Court of equity.

In applying this principle to the case tinder consideration, it will produce no injustice, or even hardship j for he who has superior right at law, has also equal equity with the party against whom he succeeds. I am aware, however, that in the situation in tvhich the present parties are placed, a resort to a Court of equity may become necessary, to protect the respondents against probable loss. If the appellant was proceeding to foreclose his mortgage by advertisement, according to the statute mode of foreclosure, then, for the safety of the respondents, it would be necessary to file a bill to redeem; for whether the mortgage could be enforced by the appellant, for the whole sum due, or not, I have no doubt it was a valid registry to the amount of three hundred dollars. If, therefore, a sale had taken place, the purchaser would, undoubtedly, hold discharged of the. respondents’ title ; and if the premises were bid off for a sum equal to the appellant’s demand, which is not to be doubled, the respondents might in vain seek to compel the appellant to pay over to them the amount exceeding the sum for which the mortgage had been registered. A bill to redeem this mortgage, by paying the 300 dollars and interest, would be a proper proceeding on the part of the respondents; in which bill it might be expedient to state the whole case, and, among other things, to aver, as they have in the present bill, that they were purchasers lor valuable consideration, and without notice, hot on the ground that such allégation was competent proof, or any proof at all, to establish the fact affirmatively, but as a denial, for the purpose of repelling any presumption or inference, that they had knowledge or notice of a mortgage of a greater amount than the sum inserted in the registry ; and but for the denial so made, such presumption or inference might be attempted to be raised and founded on the silence of the respondents on this point in their bill. In such a case, I incline to think redemption would be decreed on paying the amount registered, and such sum as should appear to have been unpaid by the respondents, on their purchases, at the time they were affected by notice, according to the principles of the Chancellor’s decree. It must, however, be understood, that such relief could only be granted on the supposition, that the deed to Corl had taken effect, and the appellant was obliged to look to the mortgage only for indemnity.

The counsel for the respondents contended, on the argument, that this was a bill to redeem ; but the authorities cited do not support the doctrine. The case of Warren v. Rathbone, (10 Johns. Rep. 587.) is not analagous. It is there decided, that “ where a Court of equity gains jurisdiction of a cause, for one purpose, it may retain it generallybut this has no connection with the question, whether the bill in the present case contains the essential requisites of a bill to redeem. On looking into precedents, it will be found that no fact is better established, than that the plaintiff who seeks redemption, must aver, “ that he is ready to pay what is due for principal and interest on the mortgage.” It can require no argument to prove that this is indispensable. How can the Chancellor decree a redemption, without payment of what is due? It would be nugatory to make such a decree, unless the plaintiff makes the offer of payment. The plaintiffcannot be compelled to redeem on the terms of payment; it is at his election to do so or not. If he makes no offer, he does not lay the foundation for a decree to redeem, nor can he expect it, although the bill may contain a special prayer for that purpose. In this cause, the bill states, that on the discovery of the mortgage registered, Frost- applied to the appellant, and proposed to pay the three hundred dollars, and interest, which he refused to accept; this was some time before the filing of the bill: The offer is not made in the bill, nor does it appear by any thing contained in it, that they were willing to pay the money when the bill was filed} it is rather to be inferred, that the respondents contemplated relief on different grounds. The prayer of the bill is for an injunction to stay all proceedings under the mortgage, and for general relief. I do not consider this (unaccompanied with an offer to pay) as sufficient to authorize a decree to redeem. And, consequently, the case, as made out by the respondents, cannot, according to principles well established in the Court of Chancery, be sustained.

With these remarks, I might dismiss the further examination of this cause, but as the parties may be disposed to bring up the question for relief in some other form, I think it will be useful now to decide another question presented for the consideration of the Court, which, if decided against the respondents, puts this controversy at rest. I refer to the question whether the title to this lot ever passed out of the appellant. The examination of this point leads us to consider, whether the deed from Beekman to Corl was delivered as an escrow, and upon what conditions; and, secondly, have the terms or conditions agreed on between the parties been performed? If they have not been performed or waived by the appellant, the respondents cannot have relief in any shape, for in that event, they acquired no interest in the land by the purchase from Corl. The loss in such a case, of necessity, and rightfully, falls on the respondents ; they purchased of, and confided in, the integrity of Corl. That confidence was, indeed, misplaced, and we impart ,to the victims of fraud and deception our commisseration, while we deny relief at the expense of a party who has not contributed to bring on them their loss.

In October, 1804, the deed from Beekman to Corl, was re-, ceived by Mr. Westerlo, inclosed in a letter, also covering a mortgage to be executed by Corl for the consideration money. The instructions in the letter are definite and certain. “ The deed to be delivered to Corl, provided he pays the balance .now due as below stated, andhas the mortgage (after executing it and the bond) put on record in the counties of Onondaga and Seneca, and bringing a certficatefrom the clerks of Onondaga, Sé--ñeca, and Cayuga, that no mortgage of incumbrance are against those lots.” This constituted a delivery as an escrow, and is so considered by the Chancellor. A deed, so delivered, has no operation, and is not to take effect, until the conditions are performed. (Co. Lit. 36.) In construing the conditions on which the delivery was made, we are bound to give effect to the words made use of, according to their known signification, and, by such rule of construction, arrive at the intent of the appellant. When the words are perfectly plain and intelligible, we are not at liberty to say, the appellant intended something different, however plausible may be such a supposition. When the grantor says the deed shall take effect on the existence of a fact, we cannot put it on the production of evidence of that fact, however probable it may appear, that had the evidence of the fact, such as exists in this case, been proposed to the grantor, at the time he made the conditional delivery, he would have been . willing to substitute it for the fact itself. Until his consent is obtained, it would be a violation of all principle to change the meaning of the words employed. It would, in fact, be . making contracts for parties, instead of adjudicating on them. The Chancellor says, (and here, I apprehend, is the founda-. tion of the error,) “ the clerk’s certificate of the registry was all that the letter to Westerlo could have intended.” How this can be correctly said, I cannot conceive, for the appellant has no reference to the certificate, but the fact of putting on record. He does not say, that he will receive any, nor what kind of evidence of the fact, but he insists on the fact itself for his security ; he had a right to say so; : it was a prudent precaution ; on this point he was not disposed to risk any thing. In the certificate there might be mistake or fraud, and thereby he might sustain loss; but if the fact existed, to wit, a true registry of the mortgage,his security was unquestionable. The appellant was about: parting with his property, at a fair value, to Corl ,* he tells him, in substance, you shall have my title if you secure me. ¡ You, the mortgagor, müst perfect the security. You are to-: receive the benefit of my title, when you have performed on your part; if casualties or mistakes occur, in carrying into effect the stipulation on your part, you must abide the consequences. The Chancellor seems to suppose, that if it was intended that actual registry should first be made, then it would become necessary for the agent to go to the county , , , r , ° ° of Onondaga ; and this, he says, was not expected. iuy answer to this is, that where the words used are plain, arguments ab inconvenienti can never be listened to, in order to prove an intent against the obvious meaning of the words. Whatever was required by the instructions, was the law to the agent, and he was bound by it, if he acted at all; he could not bind his principal beyond his authority, and in this case, being a special agent for a definite purpose, his acts beyond his authority were void.

That the intent of the appellant was as I have endeavour-ed to prove, is abundantly manifest, from that part of the instructions intended to guard against other mortgages or in-cumbrances on the lot; as to that fact, the appellant is satisfied with the production of a certificate from the clerks of Onondaga, Seneca and Cayuga, but not so as to the mortgage to be executed by Corl; putting on record,is the indispensable requisite to give validity to the deed. That this has not been done is admitted, for an erroneous registry is no performance. But, it is contended, on behalf of the respondents, that if the conditions have not been performed, there has been a waiver; and that the appellant has affirmed the deed, by advertising under the mortgage; and His Honour the Chancellor, considers, that the appellant, by receiving the mortgage, with the evidence accompanying it, has thereby, affirmed the delivery of the deed. When the mortgage was received by the appellant, the fact of the non-registry was unknown to him, and continued unknown until Septetnber, 1807, when Frost apprised Ifim of the fact. The waiver of non-performance necessarily pre-supposes a knowledge of. such non-performance. The question, then, occurs, how could the appellant waive what he did not know. Even in the case of a forfeiture, against which Courts of law lean, the forfeiture is not waived when there is no knowledge ' that it has been incurred. If the lessor be ignorant that a forfeiture has been incurred, acceptance of the rent is not a waiver of it; (Jackson v. Bronson, 7 Johns. Rep. 227.) much less ought the waiver of the conditions to be admitted in this case, when the effect of it is to deprive the appellant of a security calculated, and intended to protect him.. That appellant may have believed, that the mortgage was correctly registered, is highly probable; the certificate would induce such a belief, but, still, it might be incorrect, and, as 1 have already observed, was not the thing stipulated. It did not conclusively establish the fact, but was merely evidence of it. If it turned out that the mortgage had been registered, the deed took effect; if it did not, the title did not pass, and the appellant claimed nothing under the mortgage. He might well receive it, knowing, that in the event of a non-registry, he could derive complete protection under the conditions upon which his deed was delivered* That it was competent for him to ratify the deed, and affirm the mortgage, is admitted, but it is denied, that either is to be inferred, without knowledge brought home to the appellant, and his acts of affirmance subsequently.

The same reasoning applies to the fact, that in August, 1807, the appellant caused the mortgaged premises to be advertised under the mortgage. It will be remembered that, at this time, and until September after, the appellant remained in total ignorance of the mistake in the registry, and could not thereby be said to affirm the deed. On this question of affirming the deed, and accepting the mortgage, by acts done without knowledge of the mistake, let me ask, had the appellant known, that the registry of the mortgage was only* good for 300 dollars, and such, other sum as he might realize by bringing home notice to the purchasers, would he, for a moment, have hesitated in rejecting the mortgage altogether ? The course that would have been taken is too plain-a proposition to admit of doubt, yet, it is contended, that this election shall be denied, in consequence of acts done before a discovery was made, that the security was defective. The principle, it appears to me, would be an anomaly in our laws, demoralizing in its consequences, and subver- ’ sive of justice and fair dealing in the community ¿

I have said that the mortgage was advertised in August, 1807. This fact is derived from the admission in the answer. The counsel for the respondents ask, admitting that the appel-: lant was ignorant at the time he advertised, why did he proceed afterwards, until arrested by the Court of Chancery ? The answer to this is conclusive ; in the first place, there is not a particle of evidence in the cause, that the appellant ever did a single act, or that the notice of sale under the mortgage continued a single day, after the discovery was made. It would be wasting time to prove, that the allegations in the bill, if it contained any on this point, are not evidence$ but there is no averment that the notice was continued after the discovery of a defective registry. The answer does not admit it, and no testimony has been given respecting it, consequently, the fact is not before the Court, but if it should .be conceded, that the advertisement, which was in> serted in August, 1807, was not discontinued on the discovery of the error, it does not prove any act of recognition. The appellant was not called upon to act until the time of sale; then, indeed, he would arrive at a crisis, when it would become necessary to determine. Before that time, the appellant remained passive; he may have omitted to discontinue the advertisement; and now we are called to conclude him, because he did not act. I apprehend, that this doctrine is equally unsound with that relied on, as derived from the acts of the appellant, done before he had knowledge of all the facts; besides, between the time of discovering the defective registry and the day of sale, he had time to deliberate, whether to affirm or disaffirm the mortgage. When he was first informed, it was impossible to decide what the result would be, if he pursued the mortgage. He was a stranger to the respondents and their purchases. The information he received ascertained the fact only, that the mortgage could not be enforced beyond 300 dollars, unless notice could be brought home to the respondents; if notice could be made out, then, indeed, he could not secure his debt, on the ground of a registered mortgage; but his redress would be equally certain, on the principle, that the respondents purchased with notice. Now, if the appellant’s omission to discontinue the advertisement, compels him to look to the mortgage for security, it causes this flagrant injustice, on the face of it; to wit, you shall elect instanter; time cannot be allowed to ascertain the facts, without a knowledge of which, no election can be made with prudence or safety. I have thus shown, I think, conclusively, that the acts done before knowledge of the registry, and the omission to act afterwards, do not lay any foundation for a decree, adjudging that the appellant has, by his acts, given effect to the deed, and affirmed the mortgage; and, consequently, that the respondents are not entitled to any relief as against the appellant, on the facts appearing in this case, admitting that no objection could be taken to the pleadings.

From the view I have taken, it becomes unnecessary to notice particularly, two minor points made by the appellant’s counsel, with respect to the interest of Healey and Cole ; it does not appear, that they were interested when examined in chief.; neither was their testimony essential, nor is it noticed by the'Chanceliorin the opinion delivered. If their testimony before the master was objectionable, exceptions should have been taken to it, on the coming in of the report: and as to relief being extended to persons not parties, if the decree was sustainable in other respects, it might be modified so as to protect those only who are parties before the Court.

On the whole, after a careful examination of this cause, with all the attention in my power, I have arrived at a conclusion, satisfactory to my own mind, that the respondents, as against the appellant, are not entitled to any relief, and, consequently, that the decree of His Honour the Chancellor, be reversed, and the bill pf the respondents dismissed.

A majority of the Court^* concurring in the opinion delivered by the Chief Justice, it was thereupon ordered, adjudged and decreed, that the decree of the Court of Chancery be reversed, and that the bill in the Court of Chancery be dismissed, without prejudice to the respondents; and that the record and proceedings be remitted; &c.

Decree of reversal;

* ing i5°;rforZf-fiming, io.

Case Details

Case Name: Beekman v. Frost

Court Name: New York Supreme Court

Date Published: Apr 15, 1820

Citation: 18 Johns. 544

Court Abbreviation: N.Y. Sup. Ct.