Digman v. McCollum

• Decision Date: 28 February 1871
• Citation: 47 Mo. 372
• Parties: THOMAS DIGMAN, Appellant, v. WILLIAM MCCOLLUM, Respondent.
• Court: Missouri Supreme Court

47 Mo. 372

THOMAS DIGMAN, Appellant,

v.WILLIAM MCCOLLUM, Respondent.

Supreme Court of Missouri.

February Term, 1871.

Appeal from Livingston Court of Common Pleas.

Broaddus & Pollard, with C. H. Mansur, for appellant.

I. Malkin's bond to Young gave Young an equity in the property. (Wagn. Stat. 277, §§ 24-26; Truesdale v. Callaway, 6 Mo. 605; Woodward v. Van Hay, 45 Mo. 300.)

II. Respondent made two purchases of the property: one of Williams' equity, and the other of the legal title from Malkin. His purchase of Williams' equity was accompanied by the actual possession of the bond from Malkin to Young, and by Young assigned to Williams. From this he had actual notice of the source of Williams' title, and, by the record of the deed of trust given by Williams for the benefit of Young, he had constructive notice of appellant Digman's claim, of which he must inform himself at his peril. (Adams v. Cowherd, 30 Mo. 458; Gibson v. Lair, 37 Mo. 188; 1 Sto. Eq. Jur., § 395.)

III. Respondent not only purchased with such notice as the statute imparts by the record of the deed of trust, but by his possession of the title bond he had such information or knowledge as to require him to investigate the condition of Williams' equity at his peril, and such as to preclude him from claiming a want of otice of the equity of appellant as the assignee of Young. (Adams v. Cowherd, supra; 1 Sto. Eq. Jur. 400; Speck v. Riggin, 40 Mo. 405.) Respondent, then, holds the legal title as a trustee for the benefit of appellant, and can be made to convey it to appellant, or in lieu thereof the court can do it for him. (6 Mo. 605; 1 Sto. Eq. Jur., § 395; Wagn. Stat. 1056, §§ 27, 29.)James McFerran, for respondent.

I. The deed of trust, when filed for record and recorded, was not notice to the respondent as grantee of Malkin, under whom he claims title. (Crockett & Resque v. McGuire, 10 Mo. 37.)

II. The evidence fails to connect the respondent with any fraud, or to show any actual notice of appellant's claims to the respondent, at or before his purchase and payment of the purchase money; and the court below having found for the respondent upon the evidence, its judgment should be affirmed. (20 U. S. Dig. 169; 29 Ga. 485; 25 U. S. Dig. 92, § 68; 18 U. S. Dig. 122; Martin v. Wright, 21 Ga. 504.)

CURRIER, Judge, delivered the opinion of the court.

This is a proceeding by petition in equity to divest the defendant of title to the premises described in the petition, and to vest the same in the plaintiff. The case discloses the following facts: n May, 1868, one Malkin, who was then the owner, bargained the premises to one Young, executing to him the usual title bond, and taking from him the latter's note at two years for the pur hase money. Young subsequently assigned the bond to one Williams, who, for a valuable consideration, sold and delivered it to the defendant, Williams at the time being in possession. The defendant thereupon paid Malkin the original purchase money and interest, surrendered the bond, and took from Malkin a deed in fee. Before this transaction, however, and prior to the defendant's purchase of Williams, the latter had conveyed in trust all his right, title and interest in the premises to secure a portion of the purchase money in the transaction between him and Young. The conveyance was by a deed of trust in the usual form, which was duly executed, acknowledged and recorded prior to the defendant's purchase. The plaintiff claims under this deed, having purchased at the trustee's sale. He brings into court and tenders to the defendant the amount paid by him to Malkin, with the accrued interest, and asks that the defendant be divested of title, and that the same may be vested in him.

It is averred that the defendant purchased with full notice of the deed of trust, and that is the principal matter to be inquired into. The deed was on record, and the defendant, according to the plaintiff's view, must be presumed to have searched the records and come to a knowledge of the contents of the deed. The defendant is sought to be affected with constructive notice from the fact that the instrument was duly recorded. The general rule on this subject undoubtedly is that a purchaser must at his own peril inquire into the state of his grantor's record title, since he will be affected with constructive notice of all duly-recorded conveyances by his grantor affecting that title. I am aware of no exception to this rule, although it has repeatedly been decided that a purchaser is not affected with constructive notice of anything that does not lie within the course of the title with which he is dealing, or that is not in some way connected with it; or as Judge Scott expressed it in Crockett v. Maguire, 10 Mo. 34, the “registry of a deed is only evidence of notice to after-purchasers from the same grantor;” that is, from the grantor in the registered deed.

In the case now before the court, Williams, the grantor in the recorded deed of trust, was the defendant's vendor, as respects the equitable title to the premises in contest. That title passed from him to the defendant in virtue of the ansaction between them; that is, by the sale, receipt of the purchase money, and delivery of the bond. Had Williams passed the title by deed, he would have been the defendant's technical grantor as well as vendor. But the form of the conveyance does not affect the substance of the transaction. Williams had an interest in the property to convey. He still held the equitable title, subject to the encumbrances, for the deed of trust had not then been foreclosed. That title he passed to and vested in the defendant. Is he not to be regarded as the grantor of that interest? As between Williams and the defendant they were dealing with the equitable title and nothing else. As respected the recorded condition of that title, was it not as much the business of the purchaser to search the record as though he had been negotiating for the legal title? Where is the difference in principle?

The case is confused by connecting Malkin with the transaction between Williams and the defendant, but he had no concern with the equitable title. That had passed from him and was beyond his control. For the purposes of this investigation the case stands substantially as though Williams had conveyed his equity by deed and Malkin had not conveyed at all. Suppose the transaction had taken that form, what would have been the rights and relations of the parties? Suppose, further, that the plaintiff had purchased at the trustee's...