Patterson v. Donner

48 Cal. 369 | Cal. | 1874

Lead Opinion

By the Court, McKinstry, J.:

The contemporaneous writing executed by Lander, being under seal, should be read with the deed from Donner, and the two must be held to constitute one instrument, both as between the parties to it, and as between Donner and an assignee of Lander, with notice of the alleged defeasance. By virtue of the Begistration Act, however, a grantee of Lander in good faith, and for valuable consideration, would take the legal title, unaffected by any condition or limitation contained in the unrecorded writing.

The defendant alleges that he was induced to accept from the plaintiff a conveyance of the premises, and to execute as security for the purchase-price, the mortgage which this action was brought to foreclose, by reason of false representations on the part of the.plaintiff, that he (the plaintiff) had no notice of the writing which the defendant had failed to have recorded.

The Court below found that the representations were in fact made, but that they were true; and further found, that in law the plaintiff must be held to have had knowledge of the unrecorded portion of the instrument, because of his relations to Carr, who had actual notice of it before he paid the entire purchase-money to Lander.

No man can complain in equity of the fraudulent practices of another, unless he has been injured by such practices. It is clear, therefore, that if the right or estate derived by the defendant through the deed from the plaintiff, is unaffected by the circumstance that the latter had or had not notice of the contemporaneous writing, he cannot claim that he has been injured by the misrepresentation of which he complains. In this connection it becomes important to inquire what was the legal effect of the whole instrument executed by Lander and the defendant.

We do not think the writing executed by Lander defeated the conveyance of the fee to him. Taken together, the papers do not constitute a mortgage as of their date. It is true, the writing delivered by Lander recites: “I have received this day, from George Donner and John Yontz, a deed for the undivided one fourth part, etc., as security for the payment of twenty-five hundred dollars,” etc. But this is immediately followed by the condition: “Provided, that I do procure two witnesses to testify that they have seen what purported to be a genuine grant of said one hundredvara lot to George Donner, signed by George Hyde, first Alcalde; and in case I do not procure said witnesses, who will prove said fact, then the aforesaid deed to be null and void.” The instrument further provides that when the twenty-five hundred dollars should be paid (which was not payable until after the witnesses had been procured and had testified), then the undivided one fourth part of the lot was to be “reconveyed” to Donner and Yontz, or to such party as they might designate.

There is no recital in the instrument, nor is there anything upon its face, indicating that Lander had loaned or advanced money to Donner or Yontz. On the contrary, it is plain that it was the illegal and immoral service to be performed which was rated by the parties as of the value of twenty-five hundred dollars, and that the title was to stand as security for that sum only after the unlawful act had been accomplished. Appropriate words of conveyance transferred the legal title to Lander when the deed was executed, and, incorporating the other writing into the deed, there is nothing in the language which constitutes a ■ defeasance. The legal title was conveyed to Lander upon condition subsequent.

The defendant insists, and his defense rests upon the proposition that this condition is immoral, and against public policy. We fully agree that a stipulation that one shall, in consideration of a large sum of money, not only procure witnesses, but procure them to swear to a particular fact, is unlawful. The evidence showed that the illegal service was to be performed by a third person who was indebted to Lander in the sum named; and this removes any imputation of intentional wrong on the part of Lander. But such testimony cannot be consider,ed in construing the instrument, and does not change its legal effect. Assuming the condition subsequent found in the instrument to be against law, the legal estate having once vested in Lander, could not become divested by his failure to perform the illegal stipulation, but became and was absolute. (Co. Lit. 106; 2 Wash. Real Prop. 447; Weatherby v. Weatherby, 13 S. & M. R. 687; 4 Kent Com. 130.)

The plaintiff, as grantee of Lander, held the legal title to the premises conveyed, discharged of any condition, since the condition was void but the grant good. It follows that his estate was not limited or affected by the fact that he had notice of the unrecorded portion of the instrument under which he held; and that the defendant acquired every right by his deed from the plaintiff, which he would have derived, had the plaintiff been the purchaser in good faith, within the meaning of those terms as defined by the law. Having placed the legal title in Lander and his grantees upon an unlawful condition subsequent, the defendant could never recover the property by suit in law or equity. He reacquired it by purchase from the plaintiff, and the purchase-price was a sufficient consideration for the mortgage which is the subject of the present action.

The judgment of the Court below should be reduced, however, by the sum of five hundred dollars, fee of counsel for foreclosure. The action was brought and prosecuted by the plaintiff personally. We do not think that the stipulation in the mortgage sued on, for counsel fee, can apply where no counsel fee was paid by the plaintiff.

With this modification the judgment is affirmed, as of January 12, 1874.

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Dissenting Opinion

Rhodes, J., dissenting:

The principal question to be determined in this case is, what is the real nature of the transaction .between Donner and Yontz on the one side, and Lander and Swazy on the other? Donner and Yontz wished to procure two witnesses to testify to a certain fact, and it was agreed between all the parties that, if the witnesses should be procured by Swazy, Donner and Yontz would pay therefor the sum of two thousand five hundred dollars, and that the money would be paid to Lander, as Swazy was indebted to him.. In order to secure the payment of the money, an instrument, in form a deed of conveyance, was executed to Lander by Donner and Yontz; and thereupon Lander executed to Donner and Yontz the instrument in evidence, which may be called a defeasance. It is therein recited that Lander had received from Donner and Yontz the deed of conveyance as security for the payment of the sum of two thousand five hundred dollars, to be paid as therein mentioned, provided that he (Lander) should procure the two witnesses before mentioned, and that if he should not procure such witnesses, then the deed should be null and void. These two instruments are to be read together, as forming parts of one transaction; and when so read, they clearly constitute a mortgage. The nature of the transaction is not changed by the fact that Donner and Tontz did not make an absolute promise to pay the money. If “A.” agrees with “B.” to perform a certain act, and “B.” agrees that upon the performance of the act he will pay “A.” a certain sum of money, and executes a conveyance to secure the payment of the money, there is no doubt that the instruments will be construed between the parties as a mortgage. And if “A.” promises to pay the money if “B.” shall perform the act, the construction is the same. In other words, the question whether an instrument amounts' to a mortgage does not depend upon whether the mortgagor absolutely or conditionally promises to make the payment.

In ascertaining whether the transaction amounts to a mortgage, the real nature of the stipulations between the parties must be looked into, and therefrom the intent of the parties is to be ascertained. And if the instrument, which is in form a deed of conveyance, was in fact intended to secure the performance of an agreement on the part, of the maker of the instrument, or of some person for whom he undertook to be responsible, it will be held to be a mortgage. So in this case Bonner, and Tontz promised to pay two thousand five hundred dollars should the two witnesses mentioned be procured, and the deed was given to secure the performance of that undertaking. When an instrument is once determined to be a mortgage, the familiar rule applies: “Once a mortgage, always a mortgage.” In determining whether it be a mortgage, the question is not whether the conditions are legal or illegal. It may be admitted that the agreement on the part of Lander or Swazy to procure the two witnesses was contrary to public policy, but that fact does not change the character of the instrument and make a deed of conveyance out of a mortgage. The question of the legality or illegality of the condition is important only when it is attempted to enforce the instrument as a mortgage. It may readily be admitted that if a condition in a deed of conveyance be illegal, the deed will take effect without regard to the condition; but that principle is not involved in this case. If the transaction be found to amount to a mortgage, there is no principle of law, so far as I am aware, that will convert.it into a deed, by striking out the defeasance, because it contains an illegal condition. I am therefore unable to concur in the opinion of Mr. Justice McKinstry.

Mr. Chief Justice Wallace, having been of counsel, did not participate in the decision of this case.