Fash v. Ravesies

WALKER, J. The Mobile and Cedar-Point Railroad Company, in 1836, made an equitable mortgage on its real and personal property to A. & G. Ralston. The appellant, Eash, subsequently became a creditor of the company, and recovered judgment against it. After-wards, a bill in chancei’y was filed, for the sale of certain lands under the equitable mortgage of A. & G. Ralston. Pending the suit in chancery thus instituted, Eash, at a sale under execution issued upon his judgment, bought the lands sought to be sold by the chancery suit for the satisfaction of the equitable mortgage. Subsequently, the chancery court rendei’ed a decree, for the sale of the land ; a sale was made by the register, and Hamilton purchased. Hamilton then sold to the complainant, who went into possession; Eash never having taken possession under .his purchase. The question is, which obtained the better title — the purchaser at the sheriff’s sale, or the purchaser at the register’s sale ? [1.] The equitable mortgage of the Ralstons was registered more than sixty days after its execution. Eash is not shown to have had notice of the equitable mortgage until the institution of the suit in chancery. His judgment was rendered before the commencement of that suit. Having obtained a lien without notice, although his subsequent purchase was made with notice, he would be protected against a prior unregistered deed or conveyance of real and personal property in trust to secure the payment of debts, which is required to be recorded by the act of 1828. — Clay’s Digest, 255, § 5; De Vendell v. Hamilton, 27 Ala. 156; Jordan v. Mead, 12 Ala. 247; Wallis v. Rhea & Ross, 12 Ala. 646; Daniel v. Sorrells, 9 Ala. 436; Ohio Life Ins. and Trust Co. v. Ledyard, 8 Ala. 873. The protection of the judgment creditor, in such a case, [454] is afforded, because tbe statute declares the specified conveyances, when not recorded within the prescribed period, void against creditors, without notice; and the term “creditors ” is construed to mean creditors with a Hen. — See the authorities cited above. The statute of 1828 has been uniformly treated as a statute for the prevention of frauds, and the conveyances embraced by it have been excluded from the operation of the act which gives effect to deeds recorded after the prescribed time from the date of their registration. If the equitable mortgage in this ease is embraced in the act of 1828, its registration after the expiration of the time prescribed in that act would avail nothing. — Cummings & Cooper v. McCullough, 5 Ala. 829; Wallis v. Rhea & Ross, 12 Ala. 646; Smith & Co. v. Zurcher, 9 Ala. 209. Furthermore, as Fash obtained his judgment without notice of the equitable mortgage, and as that mortgage was not recorded within the time prescribed by the act of 1828, the title obtained by purchase at!the sheriff’s sale must be protected against the equitable mortgage, if it be one of the instruments required to be recorded. [2.] But we decide, that the contract between the Mobile and Cedar-Point Railroad Company, through its representative, Moore, is not one of the instruments required to be recorded by the act of 1828. That contract has been construed by this court in the case of the M. & C. P. R. R. Co. v. Talman & Ralston, 15 Ala. 472; and it was held in that case to have the effect of an equitable mortgage. We adopt the construction placed upon the contract in that case. Notwithstanding the contract creates an equitable mortgage, it does not follow that it falls within the registry act of 1828. The statute requires the registration of deeds and conveyances in trust to secure any debt or debts. The instrument in this case is not embraced by the act, unless it can be denominated a deed or conveyance. It is not a deed, because it is not under seal. Is it a conveyance? It simply pledges the real and personal estate of the company for the faithful performance of the contract on its part. The word 'pledge, as decided by this court in the [455] case above referred to, must not be understood in a technical sense. It must receive such a construction as to charge the real and personal estate of the company with a lien in equity in favor of the Ralstons. The contract, then, really amounts to nothing more, than a charge of the estate with alien which may be enforced in a court of equity. - There is no conveyance, either legal or equitable, to the Ralstons. There is no transfer of legal or equitable title to them. They could not, like a mortgagee, sue for and recover the property in any tribunal. As well might it be said that the' vendor’s lien, or any other lien or charge, which may be enforced in equity, comes within the registration laws. In New York, it is possible a different rule might prevail; because in that State “ any writing in the nature of a mortgage ” is required to be recorded; and it is in refei’once to that statute that the decision in Parkist v. Alexander, 1 Johns. Ch. 394, is made. — Morgan v. Morgan, 3 Stewart, 385; Wing v. McDowell, Walker’s Ch. R. (Mich.) 175; Falkner v. Jones, 12 Ala. 165; Bryan v. Smith, 22 Ala. 638; Stewart v. Kirkland, 19 Ala. 162; McCain v. Wood, 4 Ala. 263. [3-4.] Pash, having purchased pending the chancery suit in which the equity of Ralston was set up, had constructive notice of that equity. The ¿is pendens was notice to him. Whatever equity he may have had, was junior to that, of A. & G. Ralston; and the purchase of the legal title with notice will not defeat the senior equity. As between the two equities, the maxim qni prior est in tempore potior est injure applies, and a court of chancery “will not permit the party having the subsequent equity to protect himself by obtaining a conveyance of the legal title, after he has either actual or constructive notice of the prior equity.” — Grimstone v. Carter, 3 Paige, 421; Wing v. McDowell, supra; Hale v. Stone, 17 Ala. 557; 1 Story’s Equity, §§ 395, 396, 397, 64 a; 2 Sugden on Vendors, 269. See the case of Snetz & Hewett v. Donnell, in manuscript, where this point is decided. The legal title of Pash, obtained with notice of the prior equity, was subordinate to it; and, although older, is subordinate to the legal title of the purchaser at the [456] chancery sale, for he is armed with the equity of the complainants in the chancery suit. ¥e have passed by, without considering, what right, the complainant derived through the mortgage assigned to Taiman, which was foreclosed in the same suit with Ralstons’ equitable mortgage. The Taiman moi’tgage covered only a portion of the land in controversy, It is unnecessary to refer to it, because we find the complainant entitled to all the relief sought, on account of the title derived through the equity of A. & G-. Ralston, which includes the entire property. The provisions of the Code in reference to registration do not apply, and of course the case has been decided without reference to them. The decree of the court below is affirmed.