Lane v. Duchac

Ltost, J. I. On all objections to the validity of the mortgage in suit and the right of the plaintiff to maintain this action to foreclose it, the court held with the plaintiff, except upon the question of the validity of the registry thereof. In view of the undisputed fact that the defendant MeOully took a conveyance of the mortgaged land adversely to the mortgage, without actual notice of its existence, the question of the validity of the registry goes to the right of the plaintiff to a judgment of foreclosure as against him, and is therefore a vital one in the case. 1. One defect in the registry of the mortgage which it is claimed invalidates such registry is that the general index required by sec. 759, R. S., to be kept in the office of the register of deeds, and in which the mortgage is entered, does not contain a description of the mortgaged land, as required by the statute. But' where (as in this case) the mortgage has been transcribed in the proper record book of the office, this court held in Oconto Co. v. Jerrard, 46 Wis. 317, and again at the present term, in St. Croix L. & L. Co. v. Ritchie, ante, p. 409, that the defect is cured and the registry is complete from the time the instrument is so transcribed; and further, that, in the absence of proof to the contrary (and there is none in this case), it will be presumed that the entry in the general index and the actual recording of the instrument were simultaneous acts. These decisions rule this case as to the defect under consideration, — 651 — and lead to the conclusion that (unless there is some other defect fatal to the validity of the registry) the mortgage in suit was effectually recorded May 31, 1883. The grounds upon which the above decisions are placed are sufficiently stated in the opinions therein. 2. Sec. 759 requires the entry in the general index to be made immediately upon receipt of the instrument for registry, and, because there is a column in the prescribed form of such index headed “Number of Instrument,” the requirement may fairly be implied that all instruments so received must be numbered as received in consecutive order. In the present case that portion of the general index wherein the mortgage in suit is entered contains intrinsic evidence that the first of the above requirements was not complied with, for the entries therein were not made in the consecutive order either of their numbers or the dates of the receipt of the instruments. This fact, however, does not necessarily so absolutely impeach the index as to destroy the validity of the registry. If it is made to appear that the entry of the mortgage therein was made at a later date, the same presumption arises that the mortgage wras transcribed upon the records and the registry completed at that date. If thus completed before an adverse title was conveyed to the defendant Mo Gully, such registry was constructive notice to him of the plaintiff’s mortgage. These are fair deductions from the case of Hay v. Hill, 24 Wis. 235. There an entry had been written in the proper index, “ with a different ink from the entries immediately before and after, and was interlined between the ruling, and was written in after the entry of the minutes below it, and with different ink from the other entries on that page.”' There was no explanatory proof, and nothing on the face of the index to show when the entry was thus interlined, or that it wTas there at any particular time. Adverse rights in the land affected by the instrument intervened, and it was held — 652 — there could be no presumption that the entry was made before such adverse rights accrued. A perusal of the opinion in that case, prepared by the present chief justice,'will, we think, satisfy any one that, had it been shown the entry was in fact made before such rights accrued, although a considerable time after the instrument was delivered for record, the registry would have been held valid from that time, and constructive notice to such adverse claimant. The entry of plaintiff’s mortgage in the general index (as well as of three other mortgages executed by the defendants DucJiao and wife to the same mortgagee, and received for record at the same time) is between an entry of a deed, received for record June 2, 1883, at 9 a. m., and another deed so received on the same day at 4 p. m. So far as appears from the portion of the general index preserved in the bill of exceptions, no entry of any other instrument received for record on or after May 31, 1883, precedes the entries of such mortgages. Next after the entry of these mortgages we find other entries of instruments received for record at the following dates: April 14th, May 29th, June 7th, and no others received earlier than June 11th. We think from these facts that the entry of plaintiff’s mortgage must have been made either on June 2d, or within a very few days thereafter, and hence that the registry thereof was completed long before the defendant McCully acquired his adverse title to the mortgaged land. The present case is entirely unlike that of Lombard v. Culbertson, 59 Wis. 433, where it was held that an entry in the general index of the receipt of an instrument for record is essential to make the record thereof constructive notice of the instrument to a subsequent purchaser of the land affected thereby. The index of records and files required by sec. 760 is in compliance with the statute. That of grantees shows on its face (as does the general index) that the entries therein — 653 — were not made in the order in which instruments were received. But the statute does not require that they shall be so entered. We reach the conclusion, therefore, that, when Mg Gully acquired the title to the land covered by the plaintiff’s mortgage, such mortgage was effectually recorded in the register’s office of Langlade county; and hence that MeOully is chargeable with constructive notice of its existence. It follows that, if such mortgage is otherwise valid, McGully's title is subordinate and subject to it. As to the answering defendants other than Mg Gully, it is sufficient to say that they occupy no better position in respect to the plaintiff’s mortgage than does McGully. II. The question of the validity of the registry of the mortgage being thus determined in favor of the plaintiff, the defendants who have interposed answers maintain that the judgment is correct on other grounds, and they seek to uphold it on those grounds, under the rule of Maxwell v. Hartmann, 50 Wis. 660, and other cases, that the exceptions of the respondent are available on appeal to save the judgment. Such exceptions raise, in this case, and we think are all presented in, three questions. These are: (1) Is the mortgage void because the name of Barbara M. Rhyner (which it is claimed is a fictitious name) is inserted therein as mortgagee? (2) Does the evidence show any effectual assignment of the mortgage to the plaintiff? and (3) Did the payment of the amount of the mortgage debt by the mortgagor Duchac to Deleglise & Hutchinson satisfy such debt? These questions will now be considered in their order. 1. An examination of the testimony satisfies us that the $300 loaned by Schintz to the defendant Duchac, although Schintz may have received the money from his clients to be loaned, was, in contemplation of law, the money of Schintz, and that as between him and Duchac he was the — 654 — owner of the note and mortgage given therefor. He was responsible for the money so received by him, and it does not appear that he used the funds of any particular client or any person other than himself in making the loan. Had the securities been executed to him in his own name, we do not doubt he could have maintained an action upon them. It is not true that a fictitious payee and mortgagee is named in the note and mortgage. Barbara M. Rhyner is not a fictitious person, but a person in esse. True, since her marriage she is entitled to the name of her husband, Zent-ner, but we are aware of no law that will invalidate obligations and conveyances executed by and to her in her baptismal name, if she choose to give .or take them in that form. Hence, were she the owner of the note and mortgage in suit, it would be no defense to her action upon them that they were executed to her by her baptismal name. Neither is it a defense in an action upon them by any other owner that Schintz, with her consent, took them in her, baptismal name for a loan made by himself. It is not unusual for a person to take. securities in the name of another who has no interest in them, but that does not invalidate the securities or prevent the person beneficially interested from enforcing payment of them by action. 2. Schintz, being the owner of the note and mortgage, was competent to transfer the same to the plaintiff. In view of the course of business between them, as disclosed in the testimony, we think when he charged the amount of the mortgage debt to the plaintiff such transfer was made. It is not important that the papers remained in the hands of Schintz, or that he did not report the transaction to the plaintiff until long after. The relations between them were such that Schintz could lawfully make the transfer without consulting the plaintiff. If ratification b}^ the plaintiff is essential to the validity of such transfer, the bringing of this action founded upon the transfer, or the- failure to re — 655 — pudiate it, is a sufficient ratification by the plaintiff of tlie acts of Schintz. Moreover, Schintz hacl authority from the mortgagee to sign her baptismal name to the assignment of the mortgage to the plaintiff. Of course he was not competent to attest the same instrument, and certify her acknowledgment thereof before himself as a notary. But neither attestation nor acknowledgment, nor even a written assignment, are essential to the validity of the transfer of the note and mortgage to the plaintiff. A valid sale and transfer of the note could be made by parol so as to vest the same and the mortgage debt of which it is the evidence in the purchaser, and such sale would carry with it the mortgage, as the incident of the debt, without any written assignment thereof. The adjudications in this state and elsewhere to this effect are very numerous. Some of the cases are cited in the brief of counsel for plaintiff. It is immaterial that the note is not negotiable. A sale of it transfers to the purchaser the mortgage given to secure its payment as effectually as though the note were negotiable. It must be held that the plaintiff was the owner of the mortgage when this action was commenced. 3. When the mortgagor Duohac paid D. & II. the $300 for the purpose of discharging the mortgage in suit, he knew that the note and mortgage were not in the hands of that firm, but had been sent to Schintz. D. & II. did not attempt to release the mortgage, but only undertook to procure a release from or through Schintz. Duo/uto took the risk of getting the release in that manner. Had the securities been in the hands of D. & II., and had they surrendered them to Duohac, or discharged the mortgage, we should have the question of their authority to do so to determine. But I). & II. assumed to do nothing of the kind, and the question of their authority to discharge the debt is not here. We also think the testimony insufficient to prove that the firm had general authority to collect money for — 656 — Schintz before the same became due, or that the course of business between them was such, to the knowledge of Du-chas, that he had the right to assume that such authority had been given by Schintz. . Our conclusion is that the defendant’s exceptions are insufficient to sustain the judgment. The judgment of the circuit court must therefore be reversed, and the cause will be remanded with directions to that court to give judgment to the plaintiff of foreclosure and sale as demanded in the complaint. By the Court.— Ordered accordingly.