Bonnell v. Allerton

Seevers, J. [167] i romciAi. stíaotiveuotIce166 — The conceded facts are — First. The judgment [167] under which the defendant claims was rendered on the 25th day March, 1868, against A. J. Berry, by the District Court of the county in which the premises are situate, and the same were sold thereunder by the sheriff to the First National Bank of Newton on the 28th day of May, 1870. A certificate of purchase was given the bank, which was assigned to the defendant, and the sheriff conveyed to him the premises on the expiration of the period allowed for redemption. Second. At the time said judgment was rendered the legal title was in A. J. Berry, and it. so appeared of record. Third. On the 16th day of December, 1868, A. J. Berry conveyed the premises to James W. Berry, and such conveyance was filed for record October 5, 1869. Fourth. The premises were originally owned by one Wiggins, who, in 1863, conveyed the same to A. J. and James W. Berry. The plaintiffs claim that A. J. Berry sold his undivided half of the real estate in controversy to James W. Berry, in 1863, for a good and valuable consideration, and that the latter, under and by virtue thereof, took possession, and was in possession at the time the judgment was rendered and the sale made thereunder by virtue of which the defendant claims title. They further claim that the conveyance made in December, 1868, was for the purpose of vesting the legal title in James W. Berry, in accordance with such purchase and sale. These several matters are controverted by the defendant, but for the purpose of this case they will be conceded to be true. The plaintiff also claims that a deed made in 1866 by James W. to A. J. Berry was made without consideration. This, also, may be conceded, but it is undoubtedly true that thereby the legal title was placed in A. J. Berry, and a purchaser from him without notice would be protected. The plaintiff also claims that the bank, at the time the premises were sold, had actual notice that James W. Berry was the equitable owner thereof. In this view we do not concur. The [168] only testimony on which this claim is based is that of D.L. Clark, ■the president of the bank. Clark learned in some way, and he thinks he got his information from John W. Berry, that the deed made in 1866 by James W. to A. J. Berry was without consideration, and was made to avoid a prosecution for perjury which .was threatened. Prior to the sale Clark made inquiries in .relation to this matter “of the Berrys, and also of James W. Berry,” and thinks “James W. Berry said he had no title to said lands.” So far from this showing actual notice of such .equitable title, we think it shows just the reverse; for ceriainly Clark would be justified in relying on what James W. .Berry informed him, instead of mere rumor or what helearned from others. But Clark, and through him the bank, did have notice at the time of the sale that James W. Berry was in possession, and conceding the bank had no right' to rely on what James W. Berry told Clark as to the state of the title, and that the defendant is bound by the knowledge of the bank, we have for determination this case: . The legal title of record was in A. J. Berry at the time the judgment in favor of the bank was rendered, and at the time of the sale thereunder such title was in James W. Berry, and the purchaser had notice the latter was in possession. To what should he attribute such possession ? To the legal or to an equitable title, which had its inception long prior to the title being vested in James W. Berry ? Clearly to the former. The purchaser finds a party in possession owning-the legal title of record. Why should he inquire whether such possession is held under some other title? The rule is, where á party is found in possession of real property without any title of record, that good faith and common prudence require a purchaser to inquire under what title he holds, and if he. fails to so do and purchases, he takes the title subject to the equir ties of the parties in possession. But if the legal title and possession unite in the same person there is no necessity for inquiry, as the purchaser may well presume the possession to [169] be based on the legal title. Rogers v. Hussey, 36 Iowa, 664, Brown v. Wade, 42 Id., 647. The adoption of any other rule would make it incumbent ■on a purchaser, before he could purchase safely, to inquire in all instances whether a party in possession held the same -under his legal title or by virtue of .an equitable'title. The bank, therefore, was a purchaser without notice of the existence of any equitable title in James W. Berry. The title of the defendant relates back to the date of the judgment, and is, therefore, good and perfect as against the plaintiffs. The judgment of the Circuit Court is reversed, with directions to dismiss the petition and enter a decree in accordance with this opinion.; or the defendant may have such a decree in this court if he desires. Beversed.