Jackson v. Reid

• Decision Date: 01 January 1883
• Citation: 1 P. 308,30 Kan. 10
• Parties: JOHN JACKSON v. W. E. REID
• Court: Kansas Supreme Court

1 P. 308

30 Kan. 10

JOHN JACKSON v. W. E. REID

Supreme Court of Kansas

January 1, 1883

Error from Cloud District Court.

ACTION brought by Reid against Carney and wife, upon a certain note and a mortgage executed by the defendants. Jackson was made a party defendant in the action. Trial at the August Term 1882, of the district court, and judgment for plaintiff. Jackson brings the case here.

Judgment affirmed.

J. W Sheafor, and B. R. Anderson, for plaintiff in error.

Theo. Laing, for defendant in error.

BREWER J. All the Justices concurring.

OPINION

BREWER, J.:

The question in this case is as to which of two mortgages has the priority. The facts are these: On October 22, 1881, one Carney bought of plaintiff in error, defendant below, a house and lot in Clyde, and gave him a mortgage for part of the purchase-money. This mortgage was recorded on October 26. On October 23, said Carney executed another note and a mortgage, which were dated October 22. The following is a copy of the note:

"On or before the 13th day of January, 1882, I promise to pay in the city of Chicago, Ill., to the Victor Sewing Machine Company, the sum of one hundred and twenty-nine dollars, and on the first day of March, 1882, I promise to pay in the city of Chicago, Ill., to the Victor Sewing Machine Company, the sum of fifty and 4/100 dollars, with exchange for both amounts. Should I fail to pay said sums of money at the place and to the parties herein designated, then the whole of said sums of money, to wit, one hundred and seventy-nine and 4/100 dollars, becomes due and payable at Clyde, Cloud county, Kansas, to David Turner, jr., with interest after maturity at the rate of twelve per cent. per annum until paid.

M. W. CARNEY."

The mortgage securing this ran directly to Turner as mortgagee, and was recorded October 24. October 23, Turner indorsed the note to the defendant in error, plaintiff below, and at the same time delivered to him the mortgage. The testimony fails to show any knowledge by defendant in error, of plaintiff in error's mortgage at the time of this indorsement and transfer. It may perhaps also be a question upon the testimony whether Turner knew of plaintiff in error's mortgage at the time his own was executed. The case was tried by the court without a jury; a general finding and judgment were entered in favor of plaintiff, finding his note and mortgage a lien prior to that of defendant's unrecorded mortgage. As the court found generally in favor of the plaintiff, such finding is equivalent to a finding of every fact which the testimony will warrant, and which is necessary to uphold the judgment. If the testimony would warrant a finding that Turner had no knowledge of defendant's mortgage at the time his own was executed, there would be little question in the case; for § 21 of our statute concerning conveyances, (Comp. Laws 1879, p. 212,) reads:

"No such instrument in writing shall be valid, except between the parties thereto, and such as have actual notice thereof, until the same shall be deposited with the register of deeds for record."

Mortgages are unquestionably within the scope of this section. (Lewis v. Kirk, 28 Kan. 497.) Jackson's mortgage was unrecorded at the time Turner's was executed, as well as at the time it was recorded, so that if Turner had no actual notice, his mortgage was entitled to priority. In such a case the burden is on the holder of the prior unrecorded mortgage to prove the exceptions named in the section. Prima facie, it is subordinate to the later recorded mortgage. So it devolved upon Jackson to show that Turner had actual notice. As heretofore stated, Jackson's mortgage was executed and delivered, October 22. Turner's mortgage, though dated the same day and probably prepared and partially executed, was not in fact finally completed and delivered until the 23d. Both Jackson, and Carney, the mortgagor, testified that on the 22d they each told Turner of the Jackson mortgage. Turner testifies that the mortgagor did not tell him of the Jackson mortgage, and that he first heard of it on the 23d. He does not say that he did not hear of it until after his own note and mortgage were delivered to him. On the contrary, while testifying about transferring the note and mortgage to Reid, the plaintiff, he says that he did not tell him of the Jackson mortgage, though he knew of its existence; and this indorsement and transfer, as heretofore stated, were on October 23. Of course if Turner took his mortgage in ignorance of Jackson's mortgage, he took a prior lien, and could transfer the same priority to any purchaser. (Wade on the Law of Notice, § 241; Trull v. Bigelow, 16 Mass. 406; Somes v. Brewer, 2 Pick. 184.)

But in view of the uncertainty in the testimony, the fact of Turner's admitted knowledge on the day he...