62 P. 647 | Or. | 1900
Lead Opinion
after stating the facts, delivered the opinion of the court.
The question for decision is one of priority between the claim of the plaintiff banks and that of the defendants Watson and Leonard. The right of the plaintiff corporation to a prior lien for the amount due on the original loan to Loewenberg is not disputed by any of the parties. The instrument of January 5, under which the plaintiff banks claim, although not executed or acknowledged so as to make it a formal mortgage, is, nevertheless, effective as such between the parties and subsequent purchasers or attaching creditors with notice: Moore v. Thomas, 1 Or. 201; Musgrove v. Bonser, 5 Or. 313 (20 Am. Rep. 737). Unless, therefore, the defendants Watson and Leonard, as attaching creditors, are entitled to- the rights of a bona ñde purchaser for value, the plaintiff banks must prevail in this suit, because their claim is prior in time, and therefore prior in right. On behalf of the plaintiffs it is insisted that the deed of June 19, 1893, from Loewenberg and wife to- the plaintiff corporation, conveyed the legal title to* the property therein described, and that no interest remained in Loewenberg which could be levied upon under a writ of attachment; while the contention for the defendants is that the transaction amounted to nothing
This doctrine, however, does not proceed upon the theory that the record gives notice of the actual transaction, but upon the assumption that the record of the instrument in the registry of deeds, as said by Mr. Jones, is “notice of a greater
Dissenting Opinion
dissenting.
That the transaction of June 19, 1893, between Julius Loewenberg and wife and the Security Savings & Trust Company, whereby the former conveyed to- the latter certain real property by deed absolute upon its face, and the latter executed and delivered to the former a defeasance conditioned upon the repayment of a sum of money not to exceed $100,000, to be advanced by the latter to the former, consti
Now, can it be that this partially disclosed and partially concealed transaction gives any greater latitude or license to the parties thereto to change or modify it to the prejudice of others than if all its conditions had been fully revealed by promptly recording the defeasance at the time of its execution ? If so, the recording acts become a snare, rather than a protection. Mr. Watson, as we have seen, had actual knowledge. This was all that could possibly have been imparted by a full record. He was notified by the terms of the defeasance that the obligation might become less by payment, but he had no kind of notice, that it would be increased, and the fact that such defeasance was withheld from the record did not so admonish him. He had a right, therefore, to deal with the property relying upon that particular knowledge, without any further inquiry whatever, if he so desired; and this is just what he did. Much less can it be said that, for' his own protection, he was in duty bound to make further inquiry concerning subsequent incumbrances, imposed by secret, separate, and distinct agreements or conveyances having no relation to the first. Watson’s previous knowledge, however, is only an incident in the case, but it serves very aptly and strongly to elucidate the principle involved. Mr. Leonard and other third parties could not be required to possess themselves of any fuller knowledge than Watson had from the beginning, and thus it becomes manifest that the inquiry is not exacted in any event beyond the ascertainment of the nature and conditions of the single transaction of which the recorded deed forms a part. It is with reference to this transaction alone that third parties deal at their peril when they have constructive notice by the' record. They are