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MVB Remarks in Beekman v. Frost, April 1820

Van Buren, (A.G.) for the appellant. 1. Admitting all the facts stated in the respondents' bill, they have no right to relief in equity against the appellant. The registry of mortgages is solely for the purpose of securing priority, as to subsequent incumbrances. The registry is not necessary to give any validity to the mortgage itself. Suppose the mortgage had not been registered, and the mortgagee had proceeded to a foreclosure under the power of sale, could the Chancellor have enjoined him from proceeding? A Court of equity would interfere only on the ground of a mistake in the registry, or because the respondents are bona fide purchasers, without notice. But it was for the appellant, not the respondents, to ask relief on the ground of the mistake, since he is the person aggrieved. Can the respondents file a bill to take advantage of a mistake committed by the clerk, to the injury of the appellant?

2. Then, as to the other ground, this is the first attempt of a bona fide purchaser, in possession, to obtain relief against another. On a bill of discovery, if the defendant says, "I am a bona fide purchaser," and refuses to disclose his title, a Court of equity will dismiss the bill, and leave the party to seek his remedy at law. (1 Madd. Ch. 170, 171. 8 Viner Ab. tit Discovery, 546. 2 Madd. Ch. 255. 2 Vesey, jun. 457.) "The title of a purchaser for a valuable consideration, is no ground for relief, though it is a good defence." (Patterson v. Slaughter, Ambler, 192.) A Court of equity will not make a decree depriving a party of his right, on the mere allegation of the plaintiff. The plaintiff must prove that he is a bona fide purchaser without notice. Now, the evidence of S. Whitney, in answer to the sixth interrogatory, is merely an inference from circumstances, that the first notice which Frost and Goddard had of the mortgage, was in September, 1807. The Chancellor has decreed, upon the mere allegations in the bill, because those allegations have not been disproved by the appellant. Where a bona fide purchaser in possession is attacked, he may state that fact as a defence in his answer under oath, and it will protect him. The respondents do not allege that M. Goddard had no information of the mortgage at the time Corl executed the deed to him. Frost says he had no notice, nor had M. G. notice, according to his, Frost's, knowledge and belief. But, it may be objected, that this point was not raised at the hearing in the Court below, and, therefore, cannot be urged here. But every point which, from the record, goes to the very foundation of the action, may be raised at any time. (Palmer v. Lorillard, 16 Johns. Rep. 353. per Kent, Ch. J.)

3. Both parties being equally innocent, and having, therefore, equal equity, the bill ought to have been dismissed, and the parties left to their respective remedies at law. (1 Fonbl. Equ. ch. 4. s. 25. ch. 5. s. 3.) The respondents have adequate remedy at law. The only questions are as to the true construction of the registry act, and as to notice; these are questions peculiarly fit and proper for a Court of law. But we contend that the appellant has the greater equity; his innocence is purer. The respondents made their purchase of C. before he had a legal title; and they ought, before they completed their purchase, to have examined the registry, which would have led to the discovery of the mistake. If the respondents had filed their bill to redeem the mortgage, on paying the 300 dollars, they might have insisted on the relief; but their bill was not filed for that purpose. (Birne v. Hartpole, 5 Bro. P. C. 197. 2 Madd. Ch. 138.)

4. The conditions upon which the escrow was to take effect as a deed, not having been complied with, the title never passed out of the appellant. (4 Com. Dig. Fait. A. 3) The conditions were, that C. was to pay the balance, as stated, and have the mortgage duly executed and put on record in the counties of Onondaga and Seneca, and bring the certificates of the clerks of those counties, and of Cayuga, that there was no other mortgage or incumbrance. Now the mortgage never has been duly recorded; that was an essential and a very important condition; for on that the appellant relied for his security as to the purchase money. If Corl, or the respondents, should file a bill for a specific performance of the contract, a Court of equity could do justice to all parties. It cannot be said that the plaintiff waived this condition, for he did not know of the mistake, until after he had advertised the premises under the power of sale, in September, 1807.

5. The Chancellor declares that the registry is good as to the 300 dollars; if so, the appellant was entitled to that sum, with interest, in addition to the sum of 1,264 dollars and 11 cents, ordered to be brought into Court.

6. Cole and Heely, two of the respondents' witnesses, were interested, and therefore incompetent.

7. The decree, by restraining the appellant from proceeding, protects the property of persons who are not parties to the suit, and who have not applied for relief.

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Source: William Johnson, Reports of Cases Argued and Determined in the Supreme Court of Judicature: And in the Court for the Trial of Impeachments and the Correction of Errors in the State of New-York, 20 vols. (Albany: I. Riley, 1811-1823)
Collection: N/A
Series: Series 3 (17 February 1815-2 December 1821)