38 Md. 264 | Md. | 1873
delivered the opinion of the Court.
On the 5th day of October, 1870, Eichelberger borrowed from the appellee three hundred dollars, and on that day executed a mortgage of certain leasehold property, to secure its payment, the mortgage was, after its execution, handed to Eichelberger, who promised to have it recorded but failed- to do so, retaining it in his own possession till the 29th day of October, 1870, when
The appellant had no notice or knowledge of the existence of the mortgage, at the time the deed to him was executed and recorded; it was made “ in consideration of a sum of money then and for some time previous due to him from Eichelberger; ” or as charged in appellee’s bill of complaint “in settlement and satisfaction of a past indebtedness long overdue and unpaid.”
The single question for our consideration, is which of the parties is entitled to priority ; and this we think depends upon the true construction of the Code, Art. 24, sec. 16, which is in these words:
“ Where there are two or more deeds conveying the same lands, or chattels real, the deed or deeds which shall be first recorded according to law shall be preferred, if made bona fide and upon good and valuable consideration. This section to apply to all deeds of mortgage, and to all other deeds or conveyances, to the validity of which recording is necessary.”
It is conceded that the deed to the appellant was made bona fide, but it is contended that although first recorded, it is not entitled to priority, becaq.se the consideration was a pre-existing debt due from the grantor to the grantee; which, it is said, is not a “good and valuable consideration” within the meaning of the Code.
In support of this position, the counsel for the appellee has cited several cases, involving the question, when and under what circumstances, a party claiming to hold property by purchase or assignment from one having an imperfect title, will be protected as a bona fide purchaser for value, against the lawful owner, or one holding a prior equity.
Being of opinion that the deed of the appellant is entitled to he preferred, and that he took the property free from the encumbrance of the appellee’s mortgage, the decree of the Circuit Court will be reversed and the bill dismissed.
Decree reversed, and bill dismissed.