130 Mass. 50 | Mass. | 1880
The plaintiff transferred and delivered a note and mortgage for $1500 to the defendant Rice, to hold as collateral security for the payment of $300 borrowed by the plaintiff of him. The assignment of the mortgage to Rice was absolute in form, and recited that the consideration for the same was $300. Before the mortgage note became due, Rice transferred it to the defendant Gooding, as security for $1200 borrowed of the latter by Rice, and at the same time assigned the mortgage to him. The plaintiff now brings this bill in equity to redeem these securities from Gooding by paying the amount she borrowed of Rice. But Gooding has the. right to hold both note and mortgage as security for his claim against Rice, unless it is shown that he is not a holder in good faith without notice.
The plaintiff, to charge Gooding with notice, relies solely on the fact that an inadequate consideration of $300 is recited in the assignment of the mortgage from her to Rice. She contends that this alone is sufficient to indicate that Rice did not take the note for its full value, and to put Gooding on his inquiry; and that, by reason of the constructive notice thus afforded, he is subject to all the equities existing between her and Rice.
It is not easy to state by rule what constitutes in equity implied or constructive notice, because it depends in most cases upon a great variety of circumstances having a tendency to excite suspicion, or showing fraudulent purpose. The general rule is, that whatever puts a party upon inquiry amounts to notice, provided the inquiry as in the case of a purchaser is a duty, and would lead to a knowledge of the fact. It is left to be decided
The plaintiff is entitled to redeem the note and mortgage in question •, only on payment of the debt for which Gooding holds them as collateral security.
Decree for the plaintiff accordingly.