36 N.J. Eq. 199 | New York Court of Chancery | 1882
The decision of this case turns on a question of notice.
Joseph Spiess, on the 3d day of November, 1855, granted and demised, by formal deed, to Charles Boese, and to his executors, administrators and assigns, a term of ten years from the 1st day of May, 1856, in a certain lot of land situate in the city of Hoboken. The rent reserved was $650. The lease provided that Spiess should purchase of Boese, at the end of the term,
The term granted by the lease expired on the 1st day of May, 1866, but Kapp, nevertheless, continued in possession of the demised premises from that date until the 5th day of May, 1873, as tenant, upon the terms specified in the lease to Boese, and paid rent accordingly. On the date last' named (May 5th, 1873), the persons owning the fee of the demised premises conveyed their interest to Kapp, and on the next day (May 6th, 1873), Kapp and his wife executed a mortgage on the whole premises to the defendant, Auguste Kliest, to secure the sum of $8,000.
The complainant’s suit is brought for the purpose of procuring an adjudication that he is entitled to have his mortgage
This court has repeatedly decided that the erection of permanent improvements on the demised premises by a lessee, under a covenant that he shall be paid their value, gives him a lien on the demised premises for the value of the improvements, and that such lien is a purely equitable right, which can only be enforced by a court of equity. Copper v. Wells, Sax. 10; Berry v. Van Winkle, 1 Gr. Ch. 269; Decker v. Clarke, 11 C. E. Gr. 163. The principle upon which relief is given in such cases, seems to be this, that inasmuch as a valuable addition is made to the estate of the lessor, by his authority and under his promise that he will make compensation therefor (which addition must, by force of law, pass to the lessor on the expiration of the term), it is just that the sum he has stipulated to pay should be regarded as the purchase-money of the addition, and that the lessee should have a lien on the demised premises therefor, similar to that which the vendor of land has for unpaid purchase-money. Taking this principle as the standard by which the rights of the parties must be measured, the question presented for decision would be easily solved, if the litigants before the court were the original parties to the contract, or such as were limited to their rights.
The rights of the parties hinge on a question of notice. Did the defendant take her mortgage with notice, either actual or construptive, of the complainant’s rights? The defendant swears that she did not have actual notice. The lease, and its assignment to Kapp, as well as the mortgage now held by the complainant, were all acknowledged before the person who was afterwards employed by the defendant to examine the title to the demised premises, and to report to her whether she could safely take a mortgage on them or not. He, unquestionably, had full notice of the complainant’s rights. As a general rule, notice to an agent is notice to his principal, but to be effectual against the principal, the notice must have come to the agent while he was concerned for his principal, or in the course of his
The decision of the case, then, must depend on a question of constructive notice. The instruments on which the complainant’s claim is founded were all recorded regularly and promptly. But this will not, in all cases, constitute notice. The registration of an instrument not required by law to be recorded, is considered a voluntary and inefficacious act, and is, in judgment of law, no notice. James v. Morey, 2 Cow. 246; Graves v. Graves, 6 Gray 391; Villard v. Robert, 1 Strobh. Eq. 393; 2 Lead. Cas. in Eq. (pt. 1) 205. The question then is, was the lease made by Spiess to Boese, a deed or conveyance of land within the meaning of the statute respecting conveyances, so as to entitle it to be recorded ? There was no express statutory authority for the registration of leases until 1872. P. L. of 1872 p. 98. This statute of 1872 cannot, I think, be regarded as a legislative declaration that the statutes in force at the time of its enactment did not embrace leases. The statute of 1872 may have been passed to clear up what was regarded as an obscurity or to dispel doubts. It is certain there is nothing on its face tending to show that the legislature, by its enactment, meant to declare that a lease for. life was not a conveyance of lands.
The statute in force at the time the lease in question was made, declared that every deed or conveyance of or for any lands, tenements or hereditaments, to any purchaser of the same, * * * shall be void and of no effect against a subsequent judgment creditor or bona fide purchaser or mortgagee for a valuable consideration, not having notice thereof, unless such deed or conveyance shall be acknowledged or proved and recorded * * * within fifteen days after the delivery of the same. Rev. Stat. 1846 p. 643 § 18. A lease for the life of the lessee has
A deed, to be entitled to registration under this statute, must be made to a purchaser. The language of the statute is, “ every deed or conveyance of or for any lands, tenements or hereditaments, to any purchaser of the same.” Is a lessee a purchaser ? There are but two methods known to the law by which a person can acquire a right to the possession of lands, viz., by descent and by purchase. Purchase is' defined to be the possession of lands and tenements which a man hath by his own act or agreement, and not by descent from any of his ancestors or kindred. 2 Bl. Com. 241. There are five different methods of acquiring possession by purchase: 1. Escheat. 2. Occupancy. 3. Prescription. 4. Forfeiture. 5. Alienation. Id. 244- And among the instruments mentioned under the head of alienation, by which a right to the possession of lands may be acquired, leases are enumerated. Id. 310. And Cruise says that every lessee is a purchaser by his contract and covenants. 1 Greenlf. Cruise 403 ch. I. ¶ 80.
• In the light of these definitions, it would seem that there should be no doubt that a lease for a term of ten years is a con
But this court is already committed on this question. The present chancellor, in Decker v. Clarke, 11 C. E. Gr. 163, held that our statute regulating the registry of mortgages embraces mortgages of leasehold interest, and authorizes their registration. That statute, it will be remembered, declares that every deed of mortgage or conveyance in the nature of a mortgage of or for any lands, tenements or hereditaments * * * shall be void against any persons subsequently acquiring an interest in the mortgaged premises, not having notice thereof, unless such mortgage is recorded. Rev. p. 706 § 22.
The chancellor, in deciding Decker v. Clarke, adopted the rule established by the New York adjudications. As early as 1807 the court of errors of the state of New York, in construing a statute requiring the registration “of mortgages of lands, tenements and hereditaments,” held that a mortgage of a leasehold interest was within the reason and spirit of the statute, and that the record of such a mortgage .constituted notice to subsequent
The deduction to be made from these adjudications is obvious. If a mortgage of a leasehold interest is entitled to registration, it follows, necessarily, that the lease., which is the foundation of the title, must also be recorded; especially is this so where both statutes- use the same descriptive words to define what instruments shall be recorded. Besides, the registry of a mortgage made by a person having no title on record is without legal effect as notice, for the rule is firmly established that, in order to make the registry of a mortgage notice to persons subsequently acquiring an interest in the mortgaged premises, it must appear by the record of deeds that, at the time the mortgage was executed, the person executing it had title to the mortgaged premises. Losey v. Simpson, 3 Stock. 246.
'In the case just cited, Chancellor Williamson said: “When one link in the chain of title is wanting, there is no clue to guide the purchaser in his search to the next succeeding link by which the chain is continued. The title on record is the purchaser’s protection, and when he has traced the title down to an individual out of whom the record does not carry it, the registry acts make that the purchaser’s protection.” An adjudication which decides that a mortgage of a leasehold interest is entitled to registration, also decides, in consequence of the iden
The lease from Spiess to Boese was, in my judgment, entitled to registration under the statute in force at the time of its execution. Its record, therefore, operated as notice to all persons subsequently acquiring an interest in the demised premises.
It is an established rule of law that notice of a deed is notice of its contents. Smallwood v. Lewin, 2 McCart. 60; Van Doren v. Robinson, 1 C. E. Gr. 256. Notice of a memorial of any kind is notice of all its contents. Bushell v. Bushell, 1 Sch. & Lef. 90; Latouche v. Dunsany, Id. 137. If a party has notice of a lease, he has notice of everything contained in it. If, for instance, there is a covenant to renew, the purchaser cannot object, if he has notice of the lease, that he had no notice of that particular covenant. Taylor v. Stibbert, 2 Ves. 439; Hall v. Smith, 14 Ves. 426. Chancellor Green, in Van Doren v. Robinson, held that notice of a deed was notice of an agreement contained therein that the grantee should, on the happening of a certain contingency, reconvey to the grantor.
Constructive notice, under the registry acts, is as efficacious as actual notice. The purpose of those acts is to make such notice the equivalent, in all respects, of actual notice. They declare that a delinquent or careless purchaser or mortgagee shall be assumed to know what he would have learned had he explored those sources of knowledge which the law has provided for his information. The fact that the term granted by the lease in question had expired before the defendant took her mortgage, cannot, in my judgment, change the rights of the parties. Tlie record of the lease was an important link in the chain of title. It was a conveyance by the ancestor of the persons from whom the defendant’s mortgagor derived his title. No examination of the title on record could have been made without discovering it. It was the defendant’s duty to search the title on record, and she is chargeable with whatever knowledge she would have obtained by the performance of that duty. In no other way can effect be given to the great remedial purpose of the registry acts.
The complainant is entitled to a decree declaring that his