Lathrop v. Groton Savings Bank , 31 N.J. Eq. 273 ( 1879 )

The opinion of the court was delivered by

Beasley, C. J.

This bill was exhibited to foreclose two mortgages, one of which was given by William and John Batty, and the other by the same John Batty alone. In both of them the complainant was the mortgagee. The defence set up is, that although the absolute title to the mortgaged premises was and is vested in these mortgagors, or in one of them, and although such is the title as it appears upon the record in the clerk’s office, yet, nevertheless, the real owner, in equity, was the defendant, Mrs. Lathrop, and that as she was openly in the possession and enjoyment of the property both when these encumbrances were executed and for a long time antecedently, that the complainant, from that fact, was put upon inquiry, and that if it had discharged that duty, it would have discovered that its mortgagors were mere trustees, having no right to execute these instruments or either of them.

This is not a case in which it is necessary to look closely into the doctrine that the visible occupation of land will, under certain conditions, put a person acquiring an interest in such lands from a third person, invested with the apparent title, on inquiry with respect to the rights and equities of the person so in possession. This doctrine, as affected and, perhaps, limited, by our registry laws, would, in a proper connection, present an interesting subject for examination, but in its relation to the present case, such examination would be out of place, because the conduct of Mrs. Lathrop, the defendant, has been such, with regard to the complainant, as to remove this case quite out of the operation of such doctrine. The chancellor was of opinion, and I altogether concur in that opinion, that the silence of Mrs. Lathrop and her husband, when they were informed that the first mortgage had been given, and their failure to object to the act, or to notify the complainant of the situation of the equitable title, was conduct such as would naturally lead to the conclusion that the mortgagors were the absolute owners of the property, and that consequently Mrs. Lathrop is not in a position to complain that they were dealt with on that footing. To acquiesce for such a length of time in the first mortgage, was to accredit the Batties with the right to mortgage, and, in view of such acquiescence, the complainant was relieved from the duty of making inquiry. It may ' be reasonably questioned whether, in many cases, the rule that the possession of lands being in a stranger to the documentary and record title makes it unsafe to trust to such title with implicitness, has not been pushed to an extreme so as to produce inequitable results; and it certainly seems necessary, if the rule is to retain a leaven of justice, to annex to it the qualification that the occupier of the property should be required to refrain from doing’anything having an illusive tendency with respect to ownership.

On this ground, I shall vote to affirm this decree.

Decree unanimously affirmed.