Barnes v. Camack

Barculo, J. The first question arising in this case is, whether the testimony of Hannah Camack was properly received. The objection was distinctly taken before the examiner, and, although not insisted on at length on the argument, it is undoubtedly a valid one, according to well settled principles. The witness was the wife of the defendant Moses Camack, and was divorced from him, by a decree of the court of chancery made on the 28th' day of May, 1846, for the adultery of the husband committed in the year 1843. Her testimony relates to occurrences which took place in the years 1841 and 1842, while she was living with her husband. When the objection was taken before the examiner, the decree was produced, and thereupon the testimony was taken. The authorities, I think, establish the proposition fully, that the testimony of the wife can never be received against her husband, except in proceedings instituted against him on her behalf. This rule holds, not only during the coverture, but also continues to apply after a dissolution of the marriage contract, as regards transactions which took place previous to such dissolution. Mr. Phillipps thus lays down the law on this subject : “ This general rule of evidence, which has been adopted for the purpose of promoting a perfect union of interests, and of securing mutual confidence, is so strictly observed, that even after a dissolution of marriage for adultery, the wife is not admitted to give any evidence of what occurred during the marriage, which would have been excluded, if the marriage had continued. This, as Lord EHenborough has said, is on the [396] ground that the confidence, which subsisted between them at the time, shall not be violated in consequence of any future separation. Thus one great cause of distrust is removed, by making the confidence which once subsists, ever afterwards inviolable in courts of law.” (1 Phil. Ev. 83. See also Cowen & Hill’s Notes, 1554; State v. Phelps, 2 Tyler’s Rep. 374.) In Ratcliff v. Wales, (1 Hill, 63,) Bronson, Justice, in delivering the opihion of the court, distinctly recognizes this doctrine. Indeed, a contrary rule would be productive of intolerable evils. If the law were that a divorce a vinculo matrimonii would admit the wife 'to take the stand as a witness, and allow her to disclose all the transactions of the husband’s life which had been intrusted to her in the days of unbounded faith, it would tend to impair that mutual confidence between man and wife which society requires, and which the law ought to protect. Designing men might even become instrumental in procuring a divorce, for the very purpose of using the testimony of the wife to penetrate the secret affairs of her husband. The only safe and correct practice is, to adhere to the rule, that whatever passes between htisband and wife in confidence, shall forever remain sacred. The testimony of the wife, therefore, must be laid out of this case. Fortunately for the plaintiff, the main facts are substantiated by other witnesses. The testimony shows very clearly, that her son in law, Moses Camack, by gross and fraudulent misrepresentations, induced the plaintiff to. execute a satisfaction piece, on which her first mortgage was cancelled of record; and the second mortgage, of March, 1842, was substituted in its place. By this operation the mortgage of the defendant Brown, having been given in September, 1841, would stand first upon the record and be entitled to priority, unless this court can revive the first mortgage of the plaintiff, or give her second mortgage priority over Brown’s. I have no doubt of the power of the court to do either, if the case will warrant its interference. It is a familiar doctrine, that a court of equity will keep an incumbrance alive, or consider it extinguished, as will best serve the purposes of justice. (Forbes v. Moffatt, 18 Ves. 384. [397] Starr v. Ellis, 6 John. Ch. Rep. 393. Neville v. Demeritt, 1 Green’s Ch. Rep. 321.) In Miller v. Wack, (Saxton’s Ch. Rep. 204,) the chancellor of New-Jersey held, that the simple cancellation of a mortgage on the record was not an absolute bar, unless there had been actual satisfaction; that the cancel-ling is evidence sufficient to sustain the rights of all persons interested, unless the party setting up the cancelled mortgage should shew satisfactorily some accident, fraud or mistake. (See also Jackson v. Stockholm, 1 Cowen, 125; Cornell v. Lamb, 20 John. 407.) Hence there is no difficulty in reviving the first mortgage as against the mortgagor; it having been cancelled by his fraud, and without any actual satisfaction. The principal question is, whether the plaintiff is entitled to a decree as against Brown. Brown does not appear to have been a participator in the fraud. The facts of the case-entirely acquit him of any actual connection with the misrepresentations of Camack. Nevertheless the plaintiff was induced to acknowledge satisfaction of her first mortgage by those misrepresentations, and under a mistake of facts in regard to the existence of any other incumbrances. Is the defendant Brown in a situation where he can be permitted to take advantage of the mistake or fraud 1 The plaintiff’s first mortgage was given some months before Brown’s. It was on record, and he also had actual notice of it, when his mortgage was executed. Six months after his mortgage was taken, the first mortgage was cancelled. He has not loaned any money, or done any act on the faith or strength of the cancellation. He is not, therefore, a bona fide mortgagee within the meaning of the recording act and the adjudged cases. In Dickerson v. Tillinghast, (4 Paige, 221, 2,) the chancellor remarks, “ so if a subsequent purchaser merely takes the legal estate in payment of, or as security for, a previous debt, without giving up any security, or divesting himself of any right, or placing himself in a worse condition than he would have been in, if he had received notice of the prior equitable title, or lien, previous to his purchase, the court will not permit him to retain the legal title he has thus obtained, to the injury of another.” [398] In like manner Brown, not having parted with any property or right, nor having placed himself in any worse condition, in consequence of the plaintiff’s having cancelled her first mortgage, but having acquired a superior legal title by reason of her mistake, this court cannot permit him to retain it, to the injury of the plaintiff; but must give preference to the equity of the latter. (Padgett v. Lawrence, 10 Paige, 170. Millspaugh v. McBride, 7 Id. 509. Daniel v. Mitchell, 1 Story’s Rep. 172. McCarthy v. Decaix, 1 Russ. & Mylne, 614.) Hyde v. Tanner, [ante, p. 75,) was in some respects similar to this case. In that case a mortgage to the plaintiff had been given by an intestate, and after his death it was cancelled and a new mortgage taken from the heir, on the same premises, in its stead. This court set up the old mortgage and gave it priority, as against the creditors at large of the deceased, upon the ground that the first mortgage had been cancelled under a mistake of fact in regard to the existence of debts beyond the amount of assets; and that the creditors had not, in any way, been prejudiced by the cancellation. The difference between that case and the present is, that in the former the mistake was inferred, here it is proved. The principle on which both are decided, and which runs through all cases of this description, is, that when the legal rights of the parties have been changed by mistake, equity restores them to their former condition, when it can be done without interfering with any new rights acquired on the faith and strength of the altered condition of the legal rights, and without doing injustice to other persons. The plaintiff is therefore entitled to a decree, declaring the satisfaction piece void for fraud and mistake, and for the foreclosure and sale of the mortgaged premises under her two mortgages. The proceeds of the sale are to be first applied in payment of the debt and costs of the plaintiff. The surplus, if any, is to be applied towards the payment of the defendant Brown’s debt.