51 Conn. 216 | Conn. | 1883
The first question that arises in this case is, whether the mortgage made by Patrick Farrell and his wife to Garwood H. Atwood ever became a valid one by the acceptance of the mortgagee. It is found that the mortgage was made on the 10th of June, 1871, to secure two notes of $1000 and $500 executed by Patrick Farrell at the time the mortgage was given, made payable to Garwood H. Atwood or bearer on demand, the loan being made through one Tolies; and that, although the mortgage was put on
The question of the bad faith of the Farrells, and of its effect, is to be laid out of the case for the present, as Ave are considering now only the question whether the mortgage ever acquired a valid existence. It is to be observed that Atwood, in releasing it, did not repudiate it, or deny the light of Tolies to take it in his behalf, but made the release, as it is found, “ believing that the debt was paid, and relying on these representations,” and that he acted “in good faith in making the release.” There is here a very clear implication that he did not release the mortgage Avith any intention to express a non-acceptance of it, or to deny its validity, Avhile the “ good faith ” Avhich it is found that he exercised in the matter must have been a good faith toAvards parties who might have rights under the mortgage, as there could be no others Avhorn his good faith or bad faith could-affect. If there were no other facts bearing upon the question we think his conduct at this point might properly be regarded as an acceptance of the mortgage and the recognition of it as a valid one.
But we are not left to this incident for a determination of this question. It is found that sometime prior to the execution of the mortgage Atwood “ had given to one Lewis N. Tolies authority to make a loan to Patrick Farrell, secured by mortgage in the name of AtAvood,” and that Tolies made this loan and took- this mortgage accordingly. It is not' explained why Tolies did not at once inform AtAvood that he had made the loan and taken the mortgage, nor how it happened that within a week after taking the notes he sold them to the plaintiffs. He may have intended Avhen the loan was made to use Atwood’s money for it, and have changed his mind when, a feAV days after, he found that the money could be had of the plaintiffs, who it is found, paid
The next question is, AAdiat effect the release of the mortgage has upon the rights of the plaintiffs. The finding on this point is, that on the 21st of January, 1880, “ some person or persons falsely and fraudulently informed said Atwood that the note was paid, he supposing that there was but one note and that of $500; and that thereupon, without receiving any consideration, believing that the debt was paid, and relying on these representations, he in good faith executed the quitclaim deed to Patrick and Mary Farrell. The said
But this release was put upon record, and any person afterwards acquiring an interest in the premises as a bond fide purchaser for value and without notice of the fraud, would hold the interest so acquired against the plaintiffs. Let us therefore see what interests were'acquired after January 21st, 1880.
It is found that Francis A. Atwood had taken a mortgage of one of the pieces of land embraced in the mortgage to Harwood H. Atwood, prior to the execution of the latter mortgage, to secure a note of 11000. This mortgage was made on the 18th of Januaiy, 1871, while the latter, upon both pieces, was made on the 10th of June, 1871. It does not appear that this mortgage has ever been discharged or the mortgage debt paid. If so, it must stand as a prior incumbrance on the single piece of land covered by it. But the pleadings are silent concerning this mortgage. • Paragraph four of the complaint alleges that “the defendant, Francis A. Atwood claims some interest in said premises, ivMch interest accrued after said mortgage to said Garwood S. Atwood, the nature and extent of which is to the plaintiffs unknown.”
The answer of Francis A. Atwood admits this to be true, only alleging in addition that his interest is an absolute title in fee simple, so that he seems to predicate his, title solely on a subsequently acquired interest.
It is also found that on the 8th of June, 1871, two days before the plaintiffs’ mortgage was executed, Patrick and Mary Farrell mortgaged the whole premises to the Water
But it is found that “no evidence was offered to show that the said- Francis A. Atwood paid any consideration for these deeds.” They were therefore releases of the legal title held by these parties, so as to vest a clear and absolute legal title in him, with no payment or other consideration moving from him. In these circumstances, supposing him to have acted in good faith in the matter, he was not a bona, fide purchaser for value, and the rights which he thus acquired can not take precedence of the equitable rights of the plaintiffs. This principle is too well settled to require the citation of authorities.
At the time the plaintiffs purchased the notes from Tolies he delivered to Mrs. Tuttle, one of the plaintiffs, the mortgage by which they were secured. No assignment .of it was necessary; the notes in equity drew to themselves the security. Mrs. Tuttle, in taking the mortgage, held it for the benefit of both the plaintiffs, and it is now to be regarded as their joint property. All rights in the premises accruing subsequently to the taking of the mortgage, with the equity of redemption in the Farrells, having been conveyed to Francis A. Atwood, he stands as the sole party to be foreclosed.
In this opinion the other judges concurred.