36 App. D.C. 281 | D.C. Cir. | 1911
delivered the opinion of the Court:
The complainant places her objection to the decree on the ground, first, that said Richard Poole had constructive knowledge of the equitable rights of the complainant “by reason of the existence of the public records and the peculiar circumstances surrounding the entire transaction, and particularly surrounding his purchase of the note,” and, second, that said Poole “had implied knowledge by reason of the actual knowl
It is admitted that Mr. Poole, when he purchased the note now held by the defendant, acted in good faith and without actual knowledge of the equitable rights of the complainant. In such a situation the rule, as stated by the Supreme Court of the United States, is that to affect the purchaser with constructive notice it must appear that his failure to obtain actual notice “was an act of gross or culpable negligence.” Wilson v. Wall, 6 Wall. 83, 18 L. ed. 727. Again, in Townsend v. Little, 109 U. S. 504, 27 L. ed. 1012, 3 Sup. Ct. Rep. 357, the court said: “Constructive notice is defined to be in its nature no more than evidence of notice, the presumption of which is so violent that the court will not even allow of its being controverted. * * * As said by Strong, J., in Meehan v. Williams, 48 Pa. 238, what makes inquiry a duty is such a visible state of things as is inconsistent with a perfect right in him who proposes to sell.”
It is true that when Martin Brothers, as trustees and holders of the legal title of said lot, executed their release of the deed of trust securing complainant’s note, that note was not yet due, but it is also true that said release was recorded in ten days from its date, namely on June 25th, 1904; that the second deed of trust was executed on the same day and immediately recorded. When, therefore, Mr. Poole was offered this security in July, 1905, the record showed the prior trust to have been released more than one year previously; that the original or complainant’s note, if not paid, had been long since overdue; and that the second deed of trust had been of record and unchallenged for more than a year. Was there anything in the situation so inconsistent with the verity of the record as to put him upon notice? It is not an unusual occurrence for a negotiable note to be paid before maturity, and the release of a trust securing such a note naturally follows. The trustees in the recorded release certified that the note had been paid
“The equity of Williams being at least equal with that of the plaintiffs, the legal title held for Williams must prevail, and he is entitled to priority.”
Taking into consideration what the record disclosed to Poole when he purchased the second note, we certainly do not think that the mere fact that the first trust had been discharged prior to the maturity of the first note was sufficient to put him upon inquiry; nor do we attribute any importance to the fact that prior to Poole’s purchase of the second note, and prior to its maturity, an indorsement of $1,000 had been made thereon. Poole was dealing with Martin Brothers, one of whom was the holder and payee of the note, and the other of whom- one of the trustees under the deed of trust securing it. The indorsement had been made by the payee. The transaction on its face was perfectly regular, and not calculated in any way to arouse Poole’s suspicions.
There is nothing in this record, as we read it, to substantiate the contention that Martin Brothers were the agents of Poole. There is no evidence that he employed them, and the record apparently rebuts such a presumption, for it appeal’s that he paid them less than the face value of the note purchased, which would indicate that a slight discount was made him. The certificate of title furnished Poole was one year old at the time, and was evidently procured long prior thereto for use in selling this note. There is another cogent reason for holding that Martin Brothers were not Mr. Poole’s agent. Erom the letters to which reference has previously been made, it appears that Mr. Poole inquired of them whether they had any securities for ■sale, and that Thomas R. Martin, the holder of the note purchased thereupon, offered that note for sale. It is apparent, therefore, that Martin Brothers were representing Thomas R. Martin, a member of the firm, and that Mr. Poole was nothing more than a purchaser of the security which they offered him. In the cases relied upon by the complainant, agency was either admitted or clearly proved. Connecticut General L. Ins. Co. v.
Finding no error in the record, the judgment must be affixed, with costs. Affirmed.