Hydrick
and Fraser, JJ., dissenting.
Appeal
from Common Pleas Circuit Court of Union County; Jas. E
Peurifoy, Judge.
Action
by Mrs. N.C. Oliver and others against C. M. McWhirter and
others. Judgment for defendants, and plaintiffs appeal.
Reversed and remanded.
See
also, 109 S.C. 358, 96 S.E. 140.
The
master's report, referred to in the opinion, was as
follows
The above-stated case having been referred to me, I beg leave
to submit this as my report therein:
It is apparently agreed that there are only two issues for me
to pass upon, namely:
(1) Did J. L. McWhirter have sufficient notice of unrecorded
deeds from B. F. Pennington to the executors of Price, and
from the executors of Price back to Pennington, to supply the
place of the record of such deeds?
(2) Does the purchase by J. L. McWhirter, at the foreclosure
sale under the mortgage given by Pennington to Pitchford
Company, place McWhirter in a position where he can, even if
he had notice of the alleged equities of the children of
Pennington, make the claim of one who purchased from another
who had no notice.
As to the first: I think it clear, from the testimony, that
J. L. McWhirter had some notice that the children of
Pennington should have had, or did have, some interest in
this land. He evidently had heard something to this general
effect. But there is nothing in the testimony that McWhirter
had any actual knowledge that the money of those children had
really been invested in this property. Nor is there anywhere
in the record any evidence to show that McWhirter had any
knowledge whatever of the fact that a deed had been made, nor
that he knew of the contents of such deed. The statute law of
this state expressly provides that "actual notice shall
be deemed and held sufficient to supply the place of
registration only when such notice is of the instrument
itself, or of the nature and purport." Section 3543
vol. 1, Code of Laws 1912.
It has been argued before me that the rules of
equity must, when there is a conflict, prevail over the rules
of law. I apprehend that this argument is unsound, in so far
as it applies to the statute law of the state. When the rules
of the common law and of equity conflict, the former gives
way to the latter, but not, I think, when the statute law is
concerned. I find, therefore, as a matter of fact, that J. L.
McWhirter had no notice of any unrecorded deed conveying this
land out of Pennington, and find, further, that said
McWhirter had no notice of the nature and purport of such
deed or deeds.
As to the second issue: The evidence fails to satisfy me that
Pitchford Company ever had any notice of any defect in B. F.
Pennington's title to this property. Pitchford testifies,
positively, that he did not, and there is no testimony in
contradiction. The receipt, which is relied on by plaintiffs,
uses the plural, to be sure; but that does not necessarily
mean, by any means, that more than one deed was deposited
with him. As one of the attorneys said in the argument, it is
a common saying among people (laymen) that "here are my
titles," or "my titles are good," meaning only
one conveyance. In face of Pitchford's unequivocal
statement that he knew nothing of any unrecorded deed, I do
not think it possible to conclude that, from the wording of
this receipt, more than one muniment of title was deposited
with him. I find, therefore, that Pitchford Company had no
knowledge or notice of either of the unrecorded deeds set up
by the plaintiffs herein.
I therefore conclude as matter of law: First. That J. L.
McWhirter had no knowledge or notice of any rights or
equities of the plaintiffs in the said property in question
sufficient to defeat the claim of purchase for value without
notice; and, second, that the purchase by J. L. McWhirter of
said property at the foreclosure sale under the said
Pitchford mortgage placed McWhirter in the position of a
purchaser from one without notice--his rights being measured
by those of Pitchford Company, who was a
creditor without notice of any rights or equities of the
plaintiffs in said premises.
The foregoing findings and conclusions render unnecessary
consideration of the question of betterments, which was also
argued before me. In reaching these conclusions of law and
fact, I have not considered the testimony of L. G. Southard,
to which plaintiffs objected, and which I myself, on
reflection, think incompetent.
I therefore recommend that the complaint herein be dismissed,
with the costs of the action.
L. L.
Rice, of Anderson, A. C. Mann, of Greenville, and John K.
Hamblin, of Union, for appellants.
Wallace & Barron and J. A. Sawyer, all of Union, for respondents.
GARY
C.J.
This is
an action to recover possession of a house and lot, and for
partition. William Price died in 1886, leaving of force his
last will and testament, which was probated in Richland
county, containing this provision:
"I will and bequeath to Wm. C. Pennington, Benjamin F.
Pennington, Mary E. Anderson and Isabella C. Hair, to each
$1,000.00 worth of real estate in value, during their natural
lives, and after their decease to revert to their
children."
In 1887
Joseph R. Price, as executor, and Isabella M. Burns, as
executrix, of William Price's estate, commenced an action
in the court of common pleas for Lexington county, to which
B. F. Pennington and his children were made parties
defendant, alleging that Wm. Price owned a large tract of
land in Lexington county, and that the purpose of said action
was to determine whether it was his intention for the
legatees to take this specific land under the will, or
whether the land should be sold, and the sum of $1,000
invested in land, under the same condition. The special
referee in that case made his report, with the following
recommendation:
"For the defendant B. F. Pennington and his children, a
lot of land with the dwelling thereon, in the town of Jonesville, Union county, in which he has been
living for a term of years, has been purchased at a price of
$1,000, and the plaintiffs now hold title for the same,
and are ready to convey the property for the use of the said
B. F. Pennington, in accordance with the terms of the
will."
The
referee's report was confirmed, and it was ordered:
"That plaintiffs J. R. Price and Isabella M. Burns do
convey to the several defendants above named the several
parcels of real estate purchased for them; said conveyances
to be settled in accordance with the terms of the trust
created by the will of the testator, William Price,
deceased."
On the
21st of February, 1887, Charles R. Long executed a deed in
the usual form, purporting to convey the house and lot to B.
F. Pennington in fee, which was duly recorded. On the 10th of
February, 1888, B. F. Pennington executed a deed regular in
form in all respects, except there was only one subscribing
witness, purporting to convey the fee to Joseph R. Price and
Isabella M. Burns, which was not recorded. On the 7th of
March, 1888, Joseph R. Price and Isabella M. Burns executed a
deed, wherein they recited the fact that they made the deed--
"in pursuance of the judgment of the court of common
pleas in and for the county of Lexington, entitled
'Joseph R. Price, Executor, and Isabella M. Burns,
Executrix, of the Will of Wm. Price, Deceased, against Wm. C.
Pennington and Others,' purporting to convey the land to
B. F. Pennington, to have and to hold all and singular the
premises before mentioned unto the said B. F. Pennington, his
heirs and assigns, for and during his natural life, and after
his decease to revert and go to his lawful children."
This
conveyance was not recorded. It will thus be seen that the
legal title was in B. F. Pennington, that he had a beneficial
interest "for and during his natural life," and
that he was trustee for his children, who were equitable
remaindermen. B. F. Pennington died in 1915.
The defendants denied the material allegations of
the complaint and set up the following defense:
"That J. L. McWhirter, their father, acquired title to
the land described in the complaint by conveyance made by the
master of this court, under a decree for the sale thereof,
under foreclosure of a mortgage given by B. F. Pennington,
which carries the fee-simple title. The defendants' said
ancestor took all the rights, privileges, immunities,
interest, and estate of the mortgagor in said mortgage, and
acquired the absolute fee-simple title to said land against
the plaintiffs and all the world, as purchasers, from one who
purchased without notice of plaintiffs' alleged rights
under the deed set out; and defendants plead the same in bar
of this action."
The
defendants also set up a claim for betterments in case it
should be decided that they were not entitled to the land.
At the
close of the testimony, the defendants' attorneys made a
motion for the direction of a verdict, which was granted, and
the plaintiffs appealed. Whereupon the judgment of the
circuit court was reversed. 109 S.C. 358, 96 S.E. 140. The
following reasons for reversal were assigned by this court:
"In the first place, the testimony as to notice of the
plaintiffs' equitable rights by J. L. McWhirter was
conflicting, and subject to more than one reasonable
inference; and, in the second place, there was error on the
part of his honor, the presiding judge, in undertaking to
decide the plea of purchaser for valuable consideration
without notice, which is equitable in its nature, in
connection with the action to recover the possession of the
land, which must be tried by a jury, unless a decision of the
equitable issues renders unnecessary the trial of the legal
issues."
The
master, to whom the case was referred, after...
