Goodwin v. Dean

Carpenter, J. This is an action to foreclose a mortgage. The mortgage was given May 27th, 1867, and not recorded till March 22d, 1877. On the 1st of April, 1876, the defendant took a mortgage covering the same property, and in October following took another mortgage, both of which were recorded in a reasonable time. The plaintiff insists that his mortgage should have the preference on the ground that the defendant took his mortgages with knowledge of that of the plaintiff. The finding shows that the defendant, who is an attorney-at-law, was the scrivener who drew the mortgage deed which the plaintiff now owns, was a witness to it, and was the magistrate who took the acknowledgment. It is also [518] found expressly that at that time the defendant had full knowledge of that mortgage, but there is no express finding that he had such knowledge nine years later when he took his own mortgages. Upon these facts the District Court sustained the plaintiff’s claim and rendered a judgment in his favor. The defendant claims that the ruling of the court was .erroneous, and that is the sole question presented by this ■appeal. On this subject Stobt says:—“This doctrine, as to postponing registered to unregistered conveyances upon the ground of notice, has broken in upon the policy of the registration acts in no small degree; for a registered conveyance stands upon a different footing from an ordinary conveyance. It has, indeed, been greatly doubted whether courts ought ever to have suffered the question of notice to be agitated as against a party who has duly registered his conveyance. But they have said that fraud shall not be permitted to prevail. There is, however, this qualification upon th.e doctrine, that it shall be available only in cases where the notice is so clearly proved as to make it fraudulent in the purchaser to take and register a conveyance in prejudice to the known title of the other party.” 1 Story’s Eq. Jur., § 398. We do not think the circumstances of this case bring it within the doctrine as thus stated. The committee carefully refrained from finding that the defendant knew, when he took his mortgages, that the plaintiff’s mortgage was then outstanding. Without such knowledge there was no frauds The fact that he knew of the plaintiff’s deed nine years before is not equivalent to knowledge then, as there is no legal-presumption that such knowledge continued for a period of nine years so as to charge the partjr with fraud. When the-defendant wrote that deed he had no interest in the premises, and had no occasion to charge his mind with it. Drawing deeds is a part of the ordinary business of a practicing attorney, and something that he may have occasion to do several times in a day. If any man should remember the details;of a single transaction of the kind for nine years it [519] would Tbe a remarkable instance of a retentive memory. It is certainly not to be expected as a common thing. No principle of law is founded on an assumption that that will happen which seldom or never does happen. Legal principles are not only general rules, but they are in the main founded upon general rules and not upon exceptions; that is, upon the presumption that that will be done in a given case which men ordinarily do under similar circumstances. The law will not require any man to do what hardly one man in a thousand is capable of doing. Therefore the law will not presume that the defendant, when he took his mortgages, had in mind the fact that nine years before the mortgagor mortgaged the same property to a third party. If he did not have it in mind he is not in any proper sense chargeable with knowledge. If there was no knowledge there was no fraud, and, if no fraud, the defendant’s equities are prior in right and must prevail. The plaintiff’s argument assumes that the defendant’s case depends upon the presumption that he had forgotten the circumstance. It is not a mere question of forgetfulness; the question is whether he had forgotten anything that he ought to have remembered. Unless he was under some obligation to remember he is not chargeable with negligence in not remembering. The law imposed no duty upon him and his interests did not require it. If, while contemplating taking a mortgage on this property, he had been informed that the plaintiff’s mortgage was still outstanding, it would have been his duty to remember it. Due regard to his own interests and to the rights of others required him to remember it, and the law might properly impute knowledge to him; because the law supposes that a man will act with due regard to his own interests, and requires him to act with due regard to the rights of others. A failure to do so would evince a willingness, if not a desire, to defraud his neighbor, nr at least to get an advantage over him which would be inequitable and unjust. Nothing of the kind appears in this case. In addition to these considerations there are some pre [520] sumptions founded on the common experience of mankind which are in the defendant’s favor. There is the ordinary presumption on which the statute of limitations is founded, that an ordinary debt will be paid in six years. The plaintiff’s debt was overdue nearly eight .years when the defendant took his first mortgage. Then the fact that the plaintiff’s mortgage was not on record afforded some indication that it was in some way satisfied; for men ordinarily cause such instruments to be recorded. These presumptions supplement and strengthen each other, so that, even if we assume that the defendant remembered the plaintiff’s mortgage when he took his own, it is an open question whether he could be properly charged with fraud under the circumstances. Is not the presumption that the plaintiff’s claim had ceased to exist, nearly or quite as strong as the presumption that the defendant intended a fraud? Another circumstance we will notice in passing. When the plaintiff purchased his mortgage he did so with full knowledge that two of the defendant’s mortgages were first recorded; and it does not appear that he then knew that the defendant wrote that mortgage. So that, for aught that appears, he purchased with full knowledge of the apparent priority of the defendant’s equities. What effect that circumstance should have upon the present equities of the parties we will not now undertake to say. ■ For the reasons above given we think the judgment was erroneous and must be reversed. In this opinion the other judges concurred.