Blacknall v. . Hancock

Hoke, J. Tbe statute applicable, C. S., 3311, provides in effect that no deed of trust or mortgage on real estate, etc., shall be valid to pass any property as against creditors or purchasers for value from tbe donor, bargainor, or mortgagor, but from tbe registration thereof in tbe *372 county where the land lies, and the Court decisions in this State construing the law have insistently held that no notice, however full or formal, shall avail to defeat a prior registration. Fertilizer Co. v. Lane, 173 N. C., 184; Blalock v. Strain, 122 N. C., 283; Quinerly v. Quinerly, 114 N. C., 145. From a perusal of the facts stated in the judgment it appears that the deed of trust under which plaintiff directly claims, being the deed to secure $1,579.87 from Harvey and wife to T. T. Hicks, trustee, was executed 24 March, 1920, proven and filed for registration 26 March, indexed in March, 1920, exact date not given, but appearing on the index docket after the deed under which defendant claims. That the deed of trust to defendant F. W. Hancock, trustee, to secure the $850 notes, executed 23 March, 1920, was duly proven and filed for registration 23 March, 1920, appearing on the index docket of the county registry as of March, 1920, above the deed to T. T. Hicks, trustee, and presumably prior thereto. From these findings, therefore, and by express provision of the statute, as between the two, the deed of defendant has the prior lien, and in any event, on the facts of this record, the priority of defendant’s deed should prevail by reference to the time of filing, 23 March, 1920, as against 26 March, the date when plaintiff’s deed was filed. Power Co. v. Power Co., 175 N. C., 668; Glanton & Cotton v. Jacobs, 117 N. C., 427. It is urged on behalf of plaintiff that inasmuch as a portion of the money advanced on the security of plaintiff’s present deed of trust to the amount of $1,075 was used in payment of the original purchase money to the Edwards heirs, and that a deed of trust to secure the same had been proved and filed for registration 10 March, 1920, to that extent plaintiff should of right be subrogated to this claim as a prior lien on the property, but, in our opinion, the position cannot be maintained. It is recognized that the principle of subrogation does not prevail in favor of a mere volunteer, but if it be conceded that the position might arise to plaintiff by reason of a permissible inference that he paid off the Edwards debt at the request of the debtor and under an implied agreement that he might thus acquire the benefits of the lien (see Liles v. Rogers, 113 N. C., 199, citing 2d Beach on Modern Equity Jurisprudence, sec. 801), the position would not avail plaintiff on the facts of this record, for as against defendant, holding under a duly registered instrument, the Edwards heirs never acquired any lien, and there is none to which plaintiff can be substituted. The facts showing that before same was ever put on the registry, or indexed, the deed securing the Edwards debt was withdrawn from the files and the purchase money paid in full. *373 Tbe position referred to is very well stated in 27 American Encyclopedia of Law (2 ed.), at p. 206, as follows: “Tbe rights acquired by a party entitled to subrogation cannot .be extended beyond tbe rights of tbe party under whom subrogation is claimed, subrogation contemplating some original privilege on tbe part of him to whose place substitution is claimed and where no such privilege exists or where it has been waived by tbe creditor, there is nothing on which the right can be based.” Again, it is insisted that plaintiff’s claim to the extent of the purchase money debt paid to the Edwards heirs should be held superior because the deed of trust under which defendant claims is in recognition of the Edwards lien, and under the principle approved in Hinton v. Leigh, 102 N. C., 28, but on the facts presented, this exception also must be overruled. In Hinton v. Leigh, supra, the Court held that the claim under a later registered mortgage should be preferred to claims secured by a subsequent deed of trust, but which had been first registered, but this was on the ground that by correct interpretation the deed of trust fully recognized the validity of the mortgage and conveyed the land to the trustee only as subject to the mortgage lien. But the position does not prevail from the fact that in the instant case the deed of trust to defendant in the covenant against encumbrances merely excepts the claim then existent in favor of the Edwards heirs. The present comes clearly within Piano Co. v. Spruill, 150 N. C., 168, and that class of cases which hold that a mere reference to the existence of a prior encumbrance does not recognize its validity as a superior lien except as it may comply with requirements of our registration laws. We deem it not improper to refer to a statute of the recent session of the Legislature, chapter 114, amending C. S., 3553, and which may have an important bearing on the priority of liens as determined by the date of filing in connection with the indexing and cross-indexing of instruments. The matter is not further pursued, as the law does not seem to affect the rights of the parties to this controversy. We deem it desirable, however, that the attention of the profession and officials shall be called to the existence of the statute. We find no error in the present record, and the judgment for defendant is Affirmed.