Day v. Goodbar & Co.

Campbell, C. J., delivered the opinion of the court. This appeal presents another instance of the. misleading influence of Hilliard v. Cagle, 46 Miss., 309, a case valuable only as showing a state of facts which led the court to the conclusion that the scheme there condemned was fraudu [690] lent as to subsequent creditors. In so far as it may be deduced from tbe opinion in that case, that the withholding from record of any instrument, which, by law, is good as to third persons not having notice, only from the time of its being filed for record, is any thing more than a circumstance to be considered on the question of fraud, we have corrected that error in Klein v. Richardson, 64 Miss., 41, where the announcement is made that one who fails to record an instrument simply takes the risk of a supervening right to, or lien on, the land or other thing. That necessarily results from our registry laws. The Maryland case, Gill v. Griffith, 2 Md. Ch., cited with approval in the opinion in Hilliard v. Cagle, was decided on Maryland statutes widely different from ours, and that decision is inapplicable here. The eases cited in the opinion mentioned on the subject of equitable estoppel have no place in a discussion of the registry laws or a question of fraud. A judgment, enrolled as the law requires, is a lien from its rendition. A conveyance of property, whether absolute or conditional, takes effect, as to persons without notice, from the time of its being filed for record. A conveyance, or mortgage, or deed of trust, executed by Gilliland, and filed for record on the day when the instrument he did execute (June 20, 1889) was filed for record, would have been unassailable, so far as time is decisive. A judgment, confessed that day, would have been a precedent lien to any claim by the complainants. How, then, can it be held that a failure to record the instrument constituted a fraud? It did not. I may never place my recordable instruments in the proper office for registration — may keep them secret, if I choose — and by this course wrong nobody in the eye of the law, which has not made it obligatory to place instruments on record, but contents itself with declaring that certain instruments shall be ineffectual as to certain persons unless filed for record, from which date they take effect, no matter when made. If, when the appellants found that the deed of trust had not been recorded, they had procured from Gilli [691] land, a new one or an absolute conveyance of tbe land, it would have been as unassailable as the sale by the Gillilands of their mercantile assets in payment of their indebtedness to a certain sum. We are unable to perceive a distinction between a contemporaneous instrument and one executed before, and brought into being, as to third persons, by being filed for record before such’persons obtained alien. I may trust my debtor in the assurance that he will protect me when danger threatens, and, if he does, by a judgment confessed, or a mortgage, or deed of trust, or sale, before anybody else acquires a specific claim, I am entitled to my advantage, and it is no legal ground of complaint by others that they did not know of my claim, or that there was an understanding or agreement that I was to be protected. The law does not require a proclamation of debts or credits. It only requires good faith, and it does not denounce, as bad faith, confidence reposed between debtor and creditor. As long as the law allows preferences by a debtor, some will be paid to the exclusion of others, and, whatever of injustice may sometimes result from this, fraud is not predicable of it. We discover no fraud, no legal wrong, in the transaction disclosed by this record. The decree should be for the appellants. Reversed, and bill dismissed at the costs of the appellees in both courts.