75 Ind. 77 | Ind. | 1881
This suit was commenced in the Morgan 'Circuit Court, and removed by change of venue into the Owen Circuit Court. The complaint is upon two promissory motes, executed on the 14th day of April, 1873, by Jesse .Reagan and John W. Reagan to Sylvester and Leander John.son, for $500 each, one payable on the 1st day of January, 1876, and the other on the 1st day of January, 1877, and assigned by the payees to the appellants. The suit was commenced against the Reagans, the makers of the notes, but subsequently, at his instance, John W. Hadley, as assignee of Thomas W. Hadley, was made a party defendant.
The Reagans answered the complaint in two paragraphs, to which the appellants demurred separately. The demurrer to the first paragraph was sustained; to the second it was overruled. Hadley answered the complaint in one paragraph, to which a demurrer ivas filed and overruled.
The appellants replied to the answer of.the Reagans in two ¡paragraphs. The first was a general denial. To the second paragraph of the reply, the appellees, Reagans, demurred. The demurrer was sustained. The appellants replied to the answer of Hadley in four paragraphs, the first being "the general denial. Hadley demurred to second, third and fourth paragraphs of the reply and his demurrer was sustained. The cause was submitted to the court for trial; finding for the appellees. The appellants moved the court for a new trial, on the ground that the finding was not sustained "by the evidence, and was contrary to law. The court overruled the motion. The evidence is made part of the record by a bill of exceptions. ' Proper exceptions were also taken to the rulings of the court on the demurrers to the several answers of the appellees, and to the replies of the appellants. 'The errors assigned arc, that the court erred in overruling "the demurrers to the answers of the Reagans and Hadley, .and in sustaining the demurrens to the replies of the appellants ; also, in overruling their motion for a new trial.
We do not think that the notice given the appellants by the Reagans of the pendency of Hadley’s suit against them- and Johnson, made the judgment in the case binding upon them. It was for the Reagans to defend and maintain the-notes which they had executed. They could not, by notice to the appellants, require them to defend their acts. What, the notice contained, whether anything more than that a suit was pending, is not alleged. If the appellants were proper-parties to the suit, they should have been made such in the-proper way. The notice alleged to have been given did not. make them parties, nor are they bound by the judgment. •
The question is, do the facts stated show that Hadley had a right to require the Reagans to pay to him the $2,000 for' which the notes in suit were given ?
It is very clear, upon the facts stated, that the release of Hadley’s mortgage was obtained by fraud. It is equally clear that, as between Hadley and Johnson, the mortgage-still existed in full force, unaffected by said release. Rea
“Notice, before actual payment of all the purchase-money,, although it be secured, and the conveyance actually executed,, or before the execution of the conveyance, notwithstanding that the money be paid, is equivalent to notice before the contract.” 2 Sugden Vendors, 7th Am. ed., 533. The rule-stated by Sugden has been approved and followed by this, court in the case of Dugan v. Vattier, 3 Blackf. 245. In the case of Lewis v. Phillips, 17 Ind. 108, Worden, J. says r “There are few, if any, cases, holding that the payment of' part of the purchase-money, before notice, although the purchaser has taken a conveyance, is sufficient to enable him to hold the land, as against him who has a prior equitable right. But, while this is the case, there is an evident tendency, in the decisions to afford the purchaser relief and indemnity, in a proper ease, by giving him a lien upon the land, or rather,, by permitting him to make use of his legal title to secure-himself for the purchase-money paid before notice,” etc.
'Wade, in his recent work on Notice, sec. 60, says : “It is. not always necessary that the notice should be actually received before the execution and delivery of the conveyance. It will be sufficient if given before the payment of the purchase-money, and when there has been partial payment before notice received, the purchaser will be affected pro tan-to.” Hardin’s Ex’rs v. Harrington, 11 Bush, 367, is to the same effect.
The answer of the Eeagans alleges that they received notice of the fraud practiced by Sylvester Johnson upon Had
But does the fact that the land is liable for the amount due on the Hadley mortgage, with the other facts stated in the answer of the Eeagans, constitute a defence to the present suit? That this mortgage constitutes a valid incumbrance on the land sold by Johnson to the Eeagans, and for which the notes sued on were given, is true. But did the Eeagans buy the land free from, or subject to, the incumbrance ? If they purchased the land free from the incumbrance, then the consideration of the notes has failed, and the answer must be held good ; if the purchase was subject 'to the incumbrance, then the consideration of the notes has not failed, and the answer must be held to be bad.' This question must be determined by the conveyance executed by Johnson to the Eeagans.
The deed is not in the record, nor is it alleged in the answer whether or not it contained a covenant against incumbrances, or any covenants at all. We can not presume that it did. It was for the appellees to show that they were not liable upon their notes. The notes, prima facie, established their liability. If there were no covenants in thé deed by which Sylvester Johnson conveyed the land to the Eeagans, and no fraud was practiced by Johnson upon them in the procurement of the notes, the Eeagans must be deemed to
“The deed is not sot out, nor is it averred in the answer that it contained any covenants of seizin, right to convey, or any other covenants whatever. If the deed contained any covenants that were broken, the original or a copy thereof should have been filed as the foundation of the defence.” Johnson v. Houghton, 19 Ind. 359 ; Rawle Covenants, 3d ed., p. 614.
There is no averment in the answer that Johnson made any statement or representation to the Reagans, or either of them, as to his title to the land, or whether it was incumbered or not. Nor is it averred that he exhibited the release, which had been obtained from Hadley, to the Reagans. It does not appear that at the time they purchased of Johnson they knew that such release had been obtained, or that tliey in any way relied upon it. It is averred that, at the time the Reagans purchased, they knew nothing, as to the fraud by which Johnson obtained, the release. If they knew nothing about the release, they would not, of course, know, anything about the means by which it had been procured. It is not shown by the answer that Johnson practiced any fraud upon the Reagans. We think, therefore, that their answer contains no defence, and that the demurrer to it should have been sustained. For the same, and the additional reason that Hadley has no interest in the controversy, we think his answer also bad.
The judgment below should be reversed'.-
It is ordered that, upon, the foregoing Opinion, the judgment below be in all things reversed, at the costs of the appellees.