202 F. 35 | 4th Cir. | 1912
(after stating the facts as above). In the determination of the questions involved in this controversy, the plaintiff in error will be referred to as the plaintiff and the defendant in error as the defendant, inasmuch as the parties sustain the same relation in this court that they did in the court below.
It is contended by the defendant that grant No. 3,110, which embraces the 5,000 acres involved in this controversy, is invalid on account of certain irregularities as respects the entry, survey, etc. It was admitted in the court below that the 16 grants, under which the defendant claims, embrace the lands sought to be recovered. We have carefully considered this point, and are of the opinion that it is immaterial as to whether the 5,000-acre grant, made to Olmstead, under which the government originally claimed, was valid or not, inasmuch as it is admitted that the grants made to Olmstead, and upon which the defendant relies, embrace this 5,000-acre tract, and as it appears that at the time Olmstead conveyed the land in dispute to Stevens he had acquired title thereto under the 16 grants to which we have heretofore referred.
The questions at issue in this controversy are within a narrow compass, and in order that we may fully understand the vital points it should be borne in mind that Olmstead, the common source through whom the plaintiff and the defendant both claim title, in 1868 made a deed to Levi Stevens which the plaintiff insists embraces the land in controversy. The execution of this deed was acknowledged before John S. Hollingshead, of Washington, D. C., commissioner of deeds for the state of North Carolina, February 7, 1868. The deed from Stevens to the United States was acknowledged before Charles Chauncey, of Pennsylvania, commissioner of deeds for the state of North Carolina, March 15, 1869. The Olmstead deed was first registered in Clay county February 23, 1869, but it does not appear that it was properly probated and ordered to be registered. The same deed was re-registered in the same coufity on May 20, 1896. The deed from Stevens to the United ’States was registered in Cherokee county August 4, 1871, but it does not appear that this deed was properly probated and ordered to be registered. This deed was re-registered in this county May 14, 1896.
As shown by the statement of facts, the defendant bases its claim of title upon a deed made by K. Elias, commissioner, to A. Rosenthal, pursuant to a proceeding instituted at the Spring term, 1882, of the superior court of Macon county by George W. Swepson against E. B. Olmstead, in which it was alleged that on the 1st day of October,
The case was heard upon the complaint, proofs, and exhibits, and the jury returned a verdict in favor of the plaintiff, and a sale of the lands was decreed, and K. Elias was appointed commissioner to make such sale. Accordingly a sale of the lands was had, and A. Rosenthal became the purchaser of the same in the sum of $40,000. The commissioner reported the sale, that the amount had been paid, and his report was confirmed, and, in pursuance of the decree confirming his report, he executed a deed to Rosenthal for the same. The deed thus obtained from K. Elias, commissioner, was properly registered in Clay county October 17; 1890, six years prior to the second registration of the deed from Olmstead to Stevens, and also six-years prior to the re-registration of the deed from Stevens to the plaintiff.
The objection that is urged as to the registration of the deed from Olmstead to Stevens in the first instance also applies to the registration of the deed from Stevens to the plaintiff; it being insisted by the defendant that the registration of these deeds was invalid. Therefore, if we should reach the conclusion thsft the registration of the deed from Olmstead to Stevens was valid, it would necessarily follow that the registration of the deed from Stevens to the plaintiff was valid, and the legal title to the lands in controversy would thereby vest in the plaintiff. Hence the first question that arises is as to the effect of the registration of the deed from Stevens to the plaintiff in 1871. If this registration was not valid, and no title passed thereby, then the question naturally arises as to whether such attempted registration was either actual or constructive notice to subsequent creditors or purchasers for value. If we should determine this question in the negative, it would necessarily follow that the plaintiff would not be entitled to recover. This being an action of ejectment, the plaintiff must recover, if at all, upon the strength of its own title, and not upon the weakness of its adversary’s title.
“It lias been uniformly held, since the enactment of the statute controlling this matter in 1868, -that when the acknowledgment of a deed or other instrument requiring registration has been taken before some official outside of the state, in order to a valid probate, the deed with a proper certificate, should be presented to the resident clerk for approval, and there should be an express adjudication to that effect by the local officer.”
In the case, of Evans v. Etheridge et ux., 99 N. C. 43, 5 S. E. 386, it appears that on the 2d day of May, 1866, Etheridge and wife executed a deed in trust to W. T. Brinkley, conveying to him the property therein mentioned and for the purposes named. This deed in trust was delivered to the register of deeds for Dare county and registered by him without the same having been probated. The court, in that case, in referring to this phase of the question, said:
“It is insisted by the appellees that the deed in question was proved in compliance with this section before a commissionér of affidavits, and that the adjudication of the clerk is only directory, and not an essential prerequisite td registration, and that, having been registered upon the certificate of the commissioner, though without any adjudication and order of registration by the clerk, it is valid, and, the purposes of registration being to give notice, the spirit and purpose of the law is fully met. We are referred to a number of cases (Young v. Jackson, 92 N. C. 144, Holmes v. Marshall, 72 N. C. 37. and other cases) in which it was held that, ‘the provision requiring the certificate of probate by the probate judge of a county other than that of registration to be passed upon by the probate judge (the clerk) of the county of registration is directory, and that a registration which has not been so passed upon is not void.’ The analogy between those cases and that before us is lost in the fact that the functions of the clerk are broader than those of the commissioner. He not only takes the proof of acknowledgment, but adjudges the fact of ‘due execution,’ whereas the commissioner of affidavits, and perhaps others, only take and certify the acknowledgment or proof. ‘Probate of deed is taken,’ says Pearson, J., in Simmons v. Gholson, 50 N. C. 401, ‘by hearing the evidence touching the execution — i. e., the testimony of witnesses or acknowledgment of the party — and from that evidence adjudging the fact of its execution. Where the evidence is offered to the court, the entire probate is taken by it; but where the agency of a commissioner is resorted to, a part of the probate — i. e., hearing the evidence — is taken by him and certified to the court, and thereupon the probate is perfected by an adjudication that the certificate is in due form and that the fact of the execution of the deed is established by the evidence so certified.’ In cases of probate before clerks who can both take the evidence and adjudicate the fact, it has been held that, though it ought not to be omitted, the fiat of the clerk of the county of regis*42 tration is not an absolute prerequisite to a valid registration, but the validity of the registration in such cases rests upon the fact that there has been an adjudication of ‘due execution’ by an officer competent to both hear evidence and adjudicate. The register has no authority to put the deed upon his books unless proved hnd so adjudged in some one of the modes prescribed by the statute. ‘The probate is his warrant for doing so,’ and if registered without this warrant it does not create such an equity in the mortgage trustee as to affect creditors or subsequent purchasers for value. It was so adjudged in Todd v. Outlaw, 79 N. C. 235, and we refer to that case and the authorities there cited.”
In that case the court held that, inasmuch as the deed in trust from Etheridge and wife to Brinkley was registered without proper warrant, such registration did not render it valid as against the plaintiff and his creditors. In the case of Bernhardt v. Brown, 122 N. C. 587, 29 S. E. 884, 65 Am. St. Rep. 725, this doctrine was again announced by the Supreme Court of North Carolina.
An examination of the record discloses the fact that it was not contended by counsel for the plaintiff in the court below that the attempted registration of the deed from Olmstead to Stevens was sufficient to divest Olmstead of the legal title. In view of the provisions of the statute and the construction that has been placed upon it by the Supreme Court of North Carolina, we are of the opinion that the registration of this deed was invalid, and that the legal title did not pass thereby as against subsequent creditors and purchasers for value.
However, it is insisted by the plaintiff that Rosenthal took title to the 16 tracts of land now owned by the defendant with constructive or actual notice that the land in question had been conveyed to Stevens, and in turn by Stevens to the plaintiff. To support this contention oúr attention is called to what is known as the “Connor Act,” contained in chapter 147 of. the Laws of 1885, section 1 of which is in the following language:
“That section one thousand two hundred and forty-live of the Code be stricken out, and the following inserted in lieu thereof: No conveyance of land, nor contract to convey, or lease of land, for more than three years shall be valid to pass any property, as against creditors or purchasers, for a valuable consideration from the donor, bargainor or lessor, but from the registration thereof within the county where the land lieth: Provided, however, that the provisions of this act shall not apply to contracts, leases or deeds already executed, until the first day of January, 1886: Provided, further that no purchase from any such donor, bargainor or lessor, shall avail or pass title as against any unregistered deed executed prior to the first day of December, 1885, when the person, or persons holding or claiming under such unregistered deed shall be in the actual possession and enjoyment of such land, either in person, or by his, her or their tenants, at the time of the execution of such second deed, or when the person or persons claiming under or taking such second deed, had at the time of taking or purchasing under such, deed actual or constructive notice of such unregistered deed, ■ or the claim of the person or persons holding or claiming thereunder.”
It is obvious from the provisions of this act that, at the time of its enactment, the Legislature realized that something had to be done in order that conveyances of this character might be put upon a more certain basis, and thus remove all doubts as to the validity of titles and thereby prevent litigation. It appears that in many instances parties had failed to register their deeds, some had not registered their
There are two provisos in this statute; the first being that the provision of the act should not apply to contracts, leases, or deeds already executed until the 1st day of January, 1886, and the second that—
“ * * * no purchase from any such donor, bargainor or lessor, shall avail or pass title as against any unregistered deed executed prior to the first day of December, XSS5, when the person or persons holding or claiming under such unregistered deed shall be in the actual possession and enjoyment of such land, either in person or by his, her or their tenants, at the time of the execution of such second deed, or when the person or persons claiming under or taking such second deed, had at the time of taking or purchasing under such deed actual or constructive notice of such unregistered deed, or the claim of the person or persons holding or claiming thereunder.”
For some reason the plaintiff failed to avail itself of the provisions of this act by which it was given until the 1st day of January, 1886, to register its deed and thereby perfect its title. Therefore we must determine as to whether the former registration of this deed served as either actual or constructive notice to Rosenthal and those claiming under him. In considering this act it should be constantly borne in mind that the general rule incorporated therein is that no deed shall be valid as against creditors and purchasers for value except from the date of registration. Therefore, in our opinion, as to all deeds theretofore and thereafter executed, the registration was essential as against creditors and purchasers for'value. It is well settled in North Carolina that the registration of a deed or mortgage is valid as against subsequent creditors and purchasers for value, not upon the theory that it puts them upon notice, but because it divests the title of the grantor, leaving nothing to convey — hence nothing passes. If its registration is without authority of law, it has no such effect, and is invalid as against purchasers for all purposes. The purpose of the act of 1885 was to remove all controversy as to what would constitute notice, either actual or constructive, and to. make the registration the single essential act on the part of the grantee without which his deed was ineffectual to convey any title as against creditors and purchasers for value. In the case of Collins v. Davis, 132 N. C. 109, 43 S. E. 580, Judge Connor, in speaking for the court, said:
“Hollingsworth took his deed with such notice as the possession and the registration of the mortgage from Leonard to Tyson and Davis to Collins gave him of the condition of the title. Ilis honor was of the opinion that*44 he purchased with notice, and therefore took subject to the incumbrances and equities of Davis. By the failure to record the deed from Leonard to Davis, it was, under the provisions of chapter 147, Laws 1885, invalid as against Hollingsworth, who purchased for value. The proviso to said act, saving the rights of persons in the actual possession of land,' applies only to deeds executed prior to December 1, 1885. In Maddox v. Arp, 114 N. C. 585, 19 S. E. 665, Shepherd, C. J., says: ‘The present case not being within the proviso of the act, actual notice of a prior unregistered contract "to convey cannot, in the absence of fraud, affect the rights of a subsequent purchaser for value, whose deed is duly registered according to law.’ It will be observed that the act of 1885 is an exact copy of section 1254 of the Code, with the insertion of the words ‘conveyance of land or contract to convey or lease,’ etc., placing deeds upon the same basis, in regard to registration as mortgages and deeds of trust; hence, as said by this court in Allen v. Bolen, 114 N. C. 560, 18 S. E. 964, ‘thus applying to the registration of deeds the same rule applicable to the registration of mortgages.’ Since the passage of the! act of 1829 (chapter 20), brought forward and incorporated in the Oode as section 1254, Reade, J., in Robinson v. Willoughby, 70 N. C. 358, says: ‘The decisions have been uniform that- deeds in trust and mortgages are of no validity whatever as against purchasers for value and creditors, unless they are registered, and that they take effect only from and after registration just as if they had been executed then and there. * * * No notice, however full and formal, wall supply the want of registration.’ In Hooker v. Nichols, 116 N. C. 157, 21 S. E. 207, Paircloth, O. J., quoting the language of chapter 147 of the Laws of 1885, says: ‘It will be noted that the effective words of this act are identical in substance with section 1254 of the Code, and we are driven to the conclusion that the Legislature, with full knowledge of the meaning and effect of said act of 1829, intended to apply the same rule to all conveyances- of land as declared in the late act of 1885, and we must give the same effect to it.’ ”
The same rule is announced in Tremaine v. Williams, 144 N. C. 114, 56 S. E. 694, in which the court, said:
“No notice to purchasers, however full and formal, will supply the want of registration ”
—citing Quinnerly v. Quinnerly, 114 N. C. 145, 19 S. E. 99, in which Chief Justice Clark announced the same rule.
“That the defendant failed to pay for all of such lands, except 32,000 acres, for the said 32,000 acres of land he did pay for, which are situated in Steeoah township, in the county of Graham, N. C., and which were conveyed (as plaintiff is informed) by defendant to the government of the United States.”
It is also further insisted that the publication of notice of sale of these lands by the plaintiff in the News and Observer, a daily paper of that state, wherein a description of the same was contained, was notice to Rosenthal and Swepson; it appearing from the statement of the editor of that paper that “to the best of his knowledge and belief” Mr. Swepson was a subscriber. We are of opinion that the cases to which we have referred effectually dispose of this point. However,
•‘The mere fact tliat the trustee of the deed of trust, and the purchasers for a valuable consideration claiming under it, and creditors, may, at the time of its registration, have had notice, however clear, of the prior unregistered mortgage, could not at all prejudice them. This is well settled by numerous adjudications of this court. It would be otherwise, however, as to such creditors or purchasers who should fraudulently prevent or delay the registration of the prior mortgage or deed of trust.”
There is not the slightest intimation by counsel for the plaintiff that Rosenthal did or said anything that could be construed as an attempt on his part to fraudulently prevent or delay the registration of these deeds. The Connor Act is eminently fair, and at the time of its enactment afforded one whose deed was not properly registered an opportunity to have the same registered and thus perfect what may have otherwise been an imperfect title. The deeds under which' plaintiff claims, as we have stated, had not been properly registered; but, when this act was passed, it was afforded an opportunity to have the same registered before the 1st day of January, 1886; but it failed to avail itself of the provisions of the act by not having the same registered until May, 1896. In the meantime Rosenthal, under whom the defendant claims by an unbroken chain, registered his deed in 1890, thus completely depriving the defendant of the right to perfect its title by registration in pursuance to the Connor Act.
Counsel for the' plaintiff relies upon the case of Simmons Creek Coal Co. v. Doran, 142 U. S. 417, 12 Sup. Ct. 239, 35 L. Ed. 1063, to .sustain its contention as respects this point, and insists that the doctrine of caveat emptor applies to the. case at bar. While we recognize the principle relied upon by the plaintiff, nevertheless, in view of the law of North Carolina, as construed by the Supreme Court of that state, we are of the opinion that the rule invoked does not apply. The deed to Rosenthal having been registered prior to the registration of the deed from Olmstead to Stevens, as well as the deed from Stevens to the United States, we are clearly of the opinion that Rosenthal thereby acquired the legal title to the lands in dispute.
“« * * xhe subsequent re-probate and re-registration in 1897, since the plaintiff’s title accrued, and since this action was brought, can have no effect. Laws 1SS5, c. 147; Waters v. Crabtree, 105 N. C. 394 [11 S. E. 240].”
The same principle is also announced in the cases of Phillips v. Hodges, 109 N. C. 248, 13 S. E. 769; Brown v. Hutchinson, 155 N. C. 205, 71 S. E. 302; Phifer v. Barnhart, 88 N. C. 333.
“This cause coming on to be heard upon the complaint, proofs, exhibits, and verdict of the jury, and it appearing to the satisfaction of the court that a writ of summons has been duly executed on defendant, and there is no defense made to this action. * * * ”
Thus it will be seen that the decree authorizing the sale of this land recites the fact that a writ of summons had been duly executed on the defendant, which obviated the necessity of producing the summons as the basis for that proceeding. The court having found as a fact that the summons was duly executed and returned necessarily shows that the summons had been issued.
As to the next point, to wit, that there was no description of the lands involved in that controversy: We call attention to the fact that the decree also contains the following:
“ * * * Ordered, adjudged, and decreed by tbe court that the plaintiff have and recover judgment of the defendant the lands mentioned in his complaint and marked ‘Exhibit A’ amounting to eighty-nine thousand live hundred and thirty-two acres of land.”
Also the third paragraph of the complaint in that case is in the following language:
“That the defendant advanced to the plaintiff the sum of $500.00, which sum was to be paid out of the sales of these lands when sold by plaintiff; and defendant, in pursuance of the aforesaid agreement, obtained in his own name state grants for the said lands which are described in Exhibit A, and hereto attached and made a part of this complaint.”
“ * * * That the probate of all deeds and other instruments required to be registered, heretofore taken under laws existing prior to the adoption of the Code of Civil Procedure, is hereby declared to be valid to all intents and purposes and shall be admitted to registration as if the probate had been taken under existing laws.”
Apparently realizing that many deeds had been executed, proved, and registered in a manner not fully meeting the requirements of the law, the Legislature, by Laws 1876-77, c. 23, ratified December 12, 1876, provided as follows:
“That a.11 deeds and other instruments of writing, allowed of (or) required to be registered, which have been heretofore proved or acknowledged, and the private examination taken of femes covert, if any, executing the same, and certified according to the then existing law, but not registered, shall, with such certificate, be registered by the register of the proper county, upon payment to the judge of probate of such county, or other officer authorized by law to admit such deed to probate for such register, the registration fees as prescribed by law, and presentation of such deeds or other instruments of writing, with such certificate to such register for registration, at any time within two (2) years, from and after the ratification of this act; and the registration of such deeds and other instruments of writing, herein provided for, as well as the registration of all deeds, and other instruments of writing, allowed or required to be registered, which have been heretofore registered, but not by or within the time required by law, shall be. as. valid and*48 effectual in law as if the same had been before duly registered in all respects according to law: Provided, that this act shall not apply to deeds of trust, mortgages, or marriage settlements.”
There is nothing contained in the foregoing that could be construed to relate to the defects alleged as respects the probate of these deeds. In this instance there was no probate at all. Therefore it cannot be said that this act, which undertakes to cure defective probates, can have any relation to instruments attempted to be registered in the manner these were. For that reason we do not thiplc this act ápplies to the case at bar.
We have carefully considered the various cases relied upon by counsel for the government, but are of the opinion that, for the reasons hereinbefore stated, they do not apply to the case at bar. There are various assignments of error; but, owing to the conclusion we have reached as to the crucial points in this case, we do not deem it necessary to discuss the same. After a careful consideration of the facts and the law governing this case, we are of the opinion that the rulings of the learned judge, who presided in the court below, were proper, and therefore the judgment of that court should be affirmed.
Affirmed.