Insurance Company v. Eldredge

• Citation: 102 U.S. 545,26 L.Ed. 245
• Parties: INSURANCE COMPANY v. ELDREDGE
• Decision Date: 01 October 1880
• Court: United States Supreme Court

102 U.S. 545

102 U.S. 545

26 L.Ed. 245

INSURANCE COMPANY v. ELDREDGE.

October Term, 1880

APPEAL from the Supreme Court of the District of Columbia.

The facts are stated in the opinion of the court.

Mr. Walter D. Davidge and Mr. Samuel R. Bond for the appellant.

Mr. Enoch Totten, contra.

MR. JUSTICE FIELD delivered the opinion of the court.

In November, 1871, John Van Riswick sold and conveyed certain real property in the city of Washington, of which he then was the owner, to one George B. Coburn, for the sum of $7,734.40, for which the latter gave his three promissory notes, each for $2,578.13, payable respectively in one, two, and three years after date, with interest. To secure these notes, Coburn EXECUTED TO ONe william h. ward A deed oF TRust of the property. this deed authorized Ward, upon default in payment of either of the notes, to sell the property, and upon full payment of the notes, and not otherwise, to release and reconvey the property to Coburn. The deed was recorded the same month. In February, 1872, Coburn sold and conveyed the property to one Edwin E. Mayhew, subject to the deed of trust.

In June, 1872, two persons by the names of Aistrop and Dudley jointly borrowed of the complainant. Eldredge, $4,000, for which they gave their note payable in sixty days, and as collateral security delivered to him two of the three notes of Coburn before mentioned, which had been indorsed to them.

In October following, Mayhew, who had subdivided the property into sixteen lots, upon eight of which, fronting on 14th Street, houses were then being constructed, applied to the Connecticut General Life Insurance Company, through its agent at Washington, John G. Bigelow, for a loan of $32,000; and through him the loan was effected, and secured by a deed of trust upon each of the eight lots. To obtain this loan it became necessary to have the existing incumbrances upon the property discharged. The company would not take the property as security with any prior lien upon it. In addition to the deed of trust to secure Coburn's notes, the property was then subject to a prior deed of trust, executed by a former owner, to secure the sum of $7,000. The insurance company left the matter of investigating the title and determining as to the sufficiency of the security to Bigelow, who was specially instructed to see that the company had the first lien upon the property. He employed Ward, the trustee of the Coburn deed, to examine and report upon the title. In compliance, it would seem, with Bigelow's wishes and in conjunction with Van Riswick, who described himself as the holder of the first note of Coburn, but without the consent or knowledge of the complainant, then holding the other two notes, Ward...