Morrison v. Brand

Larremore, J. The first question to be considered in this case, is the construction to be given to the conveyance executed by Thomas Cooke to John Thompson, dated August 13,1839, as explained or modified by the contemporaneous agreement between the same parties. The referee has found that the transaction referred to constituted a conditional sale, and that the condition not having been performed, Thompson acquired an absolute estate in the premises conveyed. I think this conclusion was fully authorized’by the evidence. There is nothing inconsistent in the fact, that Cooke’s entire indebtedness to Thompson, was canceled by the deed of August 13, 1839. Cooke’s right to repurchase the property was optional, and created no' obligation on his part. Nor does it appear from the instruments, or the extrinsic facts, that there was any subsisting indebtedness on the part of Cooke, after the sale was consummated, or any intention by either party to create a security for any purpose. And this was an essential point in the cases of Henry v. Davis (7 Johns. Ch. 40), Peterson v. Clark (15 Johns. 205), Slee v. Manhattan Co. (1 Paige, 48-56), Horn v. Keteltas (46 N. Y. 605), Brown v. Dewey (1 Sand. Ch. 56). “ The existence of a debt is the decisive test upon this point ” (Story’s Equity Juris. § 1018 b, and cases there cited). Thompson testified that his claim against Cooke was settled by the conveyance of the property, and the referee has accepted his statement as true. The agreement to repurchase did not change the deed into a mortgage, but made the transaction a .conditional sale (Saxton v. Hitchcock, 47 Barb. 220). 2d. The mere.fact that said instruments were recorded as a mortgage could not impress that character upon them (Jackson v. Richards, 6 Cow. 617, 619). The object of the recording act was to protect subsequent purchasers and incumbrancers; bub an omission to comply with its provisions in recording a conveyance would not invalidate such conveyance as between the parties, nor would an erroneous recording thereof impair any existing right (Jackson v. Burgott, 10 Johns. 457; Same v. Phillips, 9 Cow. 94; Same v. West, 10 Johns. 466). [43] No subsequent purchaser or incumbrancer has objected or been prejudiced by said record; and as between Cooke and Thompson, the conveyance of August 13,1839, was valid ; and by reason of the failure to perform the condition to repurchase, vested an absolute title in Thompson to the premises in question. 3d. The assignment by Oakley & Davis for the benefit of creditors (May 28, 1840), conveyed said title to their assignees. It provides for the payment of all their creditors, and is not void by reason of the provision that the surplus, if any, be returned to the assignors (Wintringham v. Lafoy, 7 Cow. 735; Van Rossum v. Walker, 11 Barb. 237; Ely v. Cook, 18 Barb. 612). Nor was the preference made as to the payment of creditors, per se, fraudulent and void (Jacobs v. Remsen, 36 N. Y. 668.) The authority given to the assignees to sell upon a reasonable credit, as they (might) deem best, was a sufficient ground to invalidate the assignment as against creditors that chose to assail it for that cause. But no creditor has sought to impeach it, and thirty-three years having elapsed since its execution, the presumption of law is in favor of its acceptance by all the creditors, and the payment of their claims, in whole or in part, in accordance with the provisions of the trust. It is the duty of the courts to sustain titles, and when (as in this case) no adverse claim or possession has been shown, but it appears that plaintiffs have been in the continued possession of the premises, and paid taxes and assessments thereon since 1857, and that same have been inclosed during that period, and that a record title exists which no creditor of Oakley has sought to impeach, I think the defendant should not be relieved from his purchase on the grounds stated. The judgment should be affirmed. Robinson, J., concurred. Judgment affirmed.