Small v. Stagg

Mr. Justice Ceaig delivered the opinion of the Court: It appears, from the evidence incorporated in the record, that in February, 1871, James Stagg purchased of D. H. Aldrich, by verbal contract, the following described premises: Beginning at the north-west corner of block 1, in Allen’s addition to the city of Wilmington, thence easterly along the north line of the block 13 rods, thence south 8 rods, thence west 13 rods, thence north 8 rods to the place of beginning; situated in the county of Will. The purchase price of the premises was $2150. James Stagg paid $1000 of the purchase money and went into the possession of the property under the contract. In the month of March, 1871, James Stagg sold to Benjamin Stagg the west half of the east half of the premises for $400, and he went into possession of the premises under the contract of purchase, using it for garden purposes during the spring and summer. In September he commenced building a house, which, prior to ¡November 24, was inclosed, shingled and plastered. The house cost about the sum of $1400. It also appears that Aldrich, in pursuance of the verbal contract, on the 25th day of ¡November, 1871, conveyed the premises to James Stagg, by deed bearing date February 8, 1871. It also appears that on the 24th day of ¡November, 1871, James Stagg loaned from Daniel Small $1200, and on that day gave his promissory note for the amount, due in one year, and to secure the payment of the note he executed and delivered a deed of trust to Daniel Small on all the property purchased of Aldrich. It also appears that the money obtained from Small was used in payment of the balance of the purchase money due from James Stagg to Aldrich. In the spring of 1872, Benjamin Stagg, having paid James Stagg the full amount of purchase money agreed to be paid, received a deed for the premises purchased; the deed, however, was not acknowledged or recorded until some time afcerwards. James Stagg having failed to pay the note secured by the deed of trust, the trustee advertised the property for sale, and this bill in equity was brought by Benjamin Stagg to enjoin the sale, and to set aside the deed of trust, so far as it related to the property which he liad purchased and improved under his contract before the deed of trust was executed and delivered-. When the complainant purchased the premises in question of James Stagg, the latter was indebted to Aldrich for the property in the sum of $1150, and to this extent Aldrich held a vendor’s lien on the whole property, and it is apparent he could not acquire a clear title to the property until the debt due Aldrich was paid and discharged; but the question arises, whether Daniel Small, by advancing the money which paid off the debt of Aldrich, is entitled in a court of equity to be subrogated to the rights of Aldrich in the property, and thus secure a priority over the complainant. This court has often decided that a vendor’s lien is a right that can only be enforced by the vendor himself; that it is not assignable. Bonnell v. Holt, 89 Ill. 71. If, therefore, the defendant in the bill is entitled to protection, it must be upon some other ground. Had there been a contract or understanding, at the time that Small' loaned the $1200 to James Stagg, between them and Aldrich, that Small was to succeed to the rights of Aldrich in the property, there would be more force in the position of Small that he was entitled to protection in a court of equity, but such was not the case. So far as appears from the evidence, Small made the loan solely upon the faith of the deed of trust, which was executed on the 24th day of November, 1871. Small probably knew the money loaned would be used by Stagg in payment of the Aldrich debt, but Aldrich was an entire stranger to the transaction; he had nothing whatever to do with the loan, the deed of trust or any arrangement made between Small and Stagg in regard to the matter. It is, however, urged that the delivery of the deed from Aldrich to Stagg, and the execution of the deed of trust by Stagg to Small, are to be regarded as one transaction, and that the purchase money due for the premises was not in fact extinguished, but merely assumed a new form, and hence, in equity, the title of complainant is still subject to the debt secured by the deed of trust. In support of this position, Curtis v. Root, 20 Ill. 54, and Christy v. Hall, 46 id. 117, are relied upon. These cases announce a well settled and familiar principle, that where a person purchases a tract of land and secures a deed therefor, and at the same time executes a mortgage on the property to secure the purchase money, an existing judgment against the mortgagor does not become a lien as against the mortgage. The reason assigned for the rule is: “ The execution of the deed and mortgage being simultaneous acts, the title to the land does not for a single moment vest in the purchaser, but merely passes through his hands and vests in the mortgagee without stopping at all in the purchaser, and during this instantaneous passage the judgment lien can not attach to the title.” The principle, however, announced in the cases cited can have no application to the facts of this case. Here, the delivery of the deed from Aldrich to Stagg, and the execution and delivery of the trust deed from Stagg to Small, were not simultaneous acts. The trust deed was made and delivered on November 24, while the deed from Aldrich was delivered on the 25th. The two were separate and distinct acts, and there is no testimony in the record from which it can be presumed that the three parties intended to have the two transactions bear any relation whatever to each other. Again, James Stagg purchased the premises on the 8th day of February, 1871; he went into possession under his contract, and paid $1000 on the purchase price of the land; he was from that time the owner of the property, subject to the lien of Aldrich for the balance of the purchase money. There is, therefore, no ground for' the position that the purchase of the premises, and the giving of a deed of trust almost ten months thereafter, are one and the same transaction. We perceive no ground for holding that the trust deed is entitled to priority as against the title of complainant. There is no controversy over the fact that complainant purchased in good faith long before the deed of trust was executed; he went into the possession of the property under his purchase, and made lasting and valuable improvements thereon. The possession of complainant when the deed of trust was taken by Small, was notice to him and all others who might attempt to acquire a lien on the property of the complainant’s title in and to the premises, and any interest acquired could only be held subject to that title. The case of Doolittle v. Cook, 75 Ill. 354, is an authority in point, where it was held that actual possession of land by a purchaser holding a bond for a deed from his vendor was notice of all his rights to one taking a mortgage on the same land from the vendor, and the mortgagee would take a lien only on the vendee’s right. So, here, when Small accepted a deed of trust on the property, he was chargeable with notice of Benjamin Stagg’s title, and he could acquire no greater interest than was then possessed by the mortgagor. The decree will be affirmed. Decree affirmed.