106 Mich. 257 | Mich. | 1895
Berlin, being the owner of the premises in controversy, sold the same upon land contract to Charlton on June 23, 1891, for $3,500. Charlton took immediate possession, and continued in possession until December 4, 1891, when he rented the premises to Andrioh, who took immediate possession: On February 8 or 9, 1892, Charlton assigned his contract to Corey. Andrich continued in possession as tenant of Charlton and Corey until October, 1892. By arrangement with Charlton, he paid some, if not all, of his rent by selling groceries to Berlin, for which Charlton was to have credit. On December 14, 1891, the record title of the premises was in Berlin. Neither the land contract nor assignment was recorded. On February 18, 1892, Berlin deeded the premises to Oorey upon the delivery to him o>f Corey's check, payable to Mrs. Burroughs, Berlin's sister, and a.n assignment to Oorey by her of the duplicate contract held by Berlin, which it is claimed was sold and assigned to her by Berlin in part payment of an exist ing debt on August 31, 1891. Meantime, and on December 14, 1891, the defendants had caused a levy of execution to be made upon these premises as the property of Berlin, and complainant was ignorant of this until after his payment. He thereupon filed the bill in this cause to enjoin the sale, and appeals from a decree dismissing it. The evidence indicates that the transfer to Mrs. Burroughs was not in good faith, and it is probable that the circuit judge so found. Oorey doubtless paid in ignor
By the contract between Berlin and Charlton, the latter became owner of an equitable interest in the land, and incurred an obligation to Berlin to pay the consideration. Berlin thereby acquired a chose in action against Charlton, and hel'd the legal title to the land as security. Corey purchased the interest of Charlton, and became entitled to all of his rights. He assumed the obligation of Charlton to pay the consideration, and had a right to the deed of the premises upon full performance of the contract. By the assignment of the land contract to Mrs. Burroughs, Berlin parted with his claim against Charlton, and Mrs. Burroughs acquired the right to collect the same as assignee. Although Berlin thereby parted with his entire interest in the land, he held the legal title, but this title he held in trust for Charlton and Mrs. Burroughs, either of whom, by proceedings in chancery, might compel him to dispose of it in furtherance of the trust, — e. g., upon payment to Mrs. Burroughs the complainant could compel Berlin to convey to him, while in case of non-payment Mrs. Burroughs might sell the premises upon proceedings to foreclose her lieu. It is plain that, after the sale to Burroughs, Berlin had no interest in the premises which he could avail himself of. If the defendants can establish a defense, it must rest upon the following facts, viz.: (1) That the transfer to Burroughs was fraudulent as against them, and therefore void; (2) that neither the contract nor any of the assignments were recorded.
Under the early decisions of this State, the filing of a certificate of levy was held not to be notice to a subsequent purchaser. Columbia Bank v. Jacobs, 10 Mich. 349; Millar v. Babcock, 25 Mich. 137; Campau v. Barnard, Id. 381; French v. De Bow, 38 Mich. 708. But under 2 How. Stat. § 6173, such certificate, when recorded, became constructive notice to subsequent purchasers in good faith and for a valuable consideration whose con
From these cases it is plain that the statute cited by counsel (Pub. Acts 1889, Act No. 227) will not justify the claim that the levy constituted a lien as against the rights of Corey. So far as any payments that were made previous to the levy are concerned, the levy is ineffective. Can the same be said of the later payment? This would seem to depend upon the questions (1) whether Berlin had any interest subject to ievy; (2) if he had, whether
Bu t it is admitted that he had no actual notice of such claim, for he did not even know of the levy. The defendants’ claim, then, seems to rest upon the fact that the levy was recorded, and the further claim that the fact of the levy should have apprised the. complainant that the transfer to Burroughs was claimed to be fraudulent, or at least that it had priority over the unrecorded contract and assignment to her. It is a well-settled rule that under the recording acts the operation of the record as notice is prospective, and not retrospective. In Wade on Notice (section 203) it is said:
“The only purchasers who are charged with notice by the registration of an instrument affecting the title to land are those who purchase subsequent to the deposit of the instrument with the registering officer.”
This doctrine has ample support in Michigan. James v. Brown, 11 Mich. 25; Ladue v. Railroad Co., 13 Mich. 380; Cooper v. Bigly, Id. 176; Dewey v. Ingersoll, 42 Mich. 17; Atwood v. Bearss, 15 Mich. 169; Shelden v. Warner, Id. 638; 1 Jones, Mortg. § 562, and note. In Baldwin v. Thompson, 15 Iowa, 501, it was held that, while judgments were liens upon the vendor’s interest in land, they were not in themselves notice to the vendee, who might safely pay the consideration in the absence of actual notice. See, also, Polk Co. v. Sypher, 17 Iowa, 358. The complainant had no such notice, and, having paid in good faith to those apparently entitled to receive the money, should be protected in such payment; and as it appears that at the time Berlin made the deed he (the complainant) had a right to demand it, having paid the full purchase price of the land, there is no reason for permitting the defendants to proceed with the sale under the levy.
A decree will be entered in accordance with the prayer of the bill, with costs of both courts.