82 N.Y. 32, Viele v. Judson

Citation:82 N.Y. 32
Party Name:PLATT C. VIELE, Appellant, v. JUNIUS JUDSON, impleaded with others, Respondent.
Case Date:September 21, 1880
Court:New York Court of Appeals
 
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82 N.Y. 32

PLATT C. VIELE, Appellant,

v.

JUNIUS JUDSON, impleaded with others, Respondent.

New York Court of Appeal

September 21, 1880

Argued Jun. 11, 1880.

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COUNSEL

John Davy for appellant. The assignment being valid, the subsequent discharge of the mortgage by Vaughn on the application of the mortgagor was not only a fraud, but a nullity as against the plaintiff. (Belden v. Meeker, 47 N.Y. 308; Van Derkemp v. Shelton, 11 Paige, 29.) Judson took his mortgage subject not only to the equities attending its execution, but subject also to the equities which third parties could enforce against the assignor. (Crane v. Turner, 67 N.Y. 437; Green v. Warwick, 64 Id. 220.) The fact that Hubbard and Ludlum having actual knowledge of the existence and validity of plaintiff's mortgage, obligated themselves to pay it, was sufficient to protect the plaintiff's interest in the mortgaged premises. (Mickles v. Townsend, 18 N.Y. 575; Dusenbury v. Hulburt, 59 Id. 546.)

George F. Yeoman for respondent. The assignment was not sufficient in form or substance to constitute a constructive notice. (Moore v. Sloan, 50 Barb. 442.) The record of the assignment, even if it was not defective in form or substance, was not notice to any person except to those acquiring subsequent rights in the mortgage itself. (Greene v. Warwick, 64 N.Y. 220; Crane v. Turner, 67 Id. 437.) The defendant, Judson, is not affected by Hubbard's knowledge of the existence of the plaintiff's mortgage. (1 R. S. 762, § 37; Ely v. Schofield, 35 Barb. 335; Schaffer v. Reilley, 50 N.Y. 61, 66.) The discharge from the records of the plaintiff's mortgage was valid as to Judson. (1 R. S. 761, 762, § § 28, 29, 37; Warner v. Winslow, 1 Sandf. Ch. 430; Ely v. Schofield, 35 Barb. 333; Van Kuren v. Calkins, 66 N.Y. 77, 82; Jackson v. Van Valkenberg, 8 Cow. 260; Fort v. Bush, 5 Denio, 191; De Lancy v. Stearns, 66 N.Y. 161.) The plaintiff's laches in not taking legal measures to correct the records estop him from saying that the discharge is not valid. (Continental Nat. Bk. v. Nat. Bk. of the Commonwealth, 50 N.Y. 575, 583;

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Stevens v. Dennett, 51 N.H. 324, 334-5; Phillips v. Gallant, 62 N.Y. 256, 263; Manufacturers', etc., Bk. v. Hazard, 80 Id. 226, 230; Odlin v. Gove, 41 N.H. 364, 474-6; Sherman & Redfield on Negligence, § 11; Stillwell v. Mutual Life Ins. Co., 72 N.Y. 385, 388; Wilcox v. Howell, 44 Id. 398, 403; Costello v. Mead, 55 How. 356, 358; Cornish v. Abington, 4 Hurl. & Norm. 556; Horn v. Cole, 51 N.H. 287, 293-300; Gregg v. Von Phul, 1 Wall. 274, 281; Hill v. Epley, 31 Penn. St. 331, 334; Niven v. Belknap, 2 Johns. 573, 589; Pickard v. Seares, 6 Ad. & El. 469, 474; Gregg v. Wells, 10 Id. 90; Chapman v. Chapman, 59 Penn. St. 214, 219; Taylor v. Ely, 25 Conn. 250, 258.) The plaintiff, by permitting the record to be in such an imperfect state that the mortgagee was able to perpetrate the fraud of discharging the mortgage, must suffer the loss resulting therefrom instead of one acting in good faith and not contributing to the circumstances which made the wrongful act possible. (Trustees of Union College v. Wheeler, 61 N.Y. 110-112; Bank, etc., v. Amsden, 14 Iowa, 544.)

FINCH, J.

The effect of the recording acts upon the rights of Viele as assignee of the mortgage given by Decker to Vaughn and by the latter discharged fraudulently, and without authority, presents the primary question in this case. The record of such an assignment is not constructive...

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