Williams v. Smith

Atkinson, J.

(After stating the foregoing facts.)

1. From the statement of facts it is seen that Eaines executed two deeds to the premises in dispute. Under the older of the two the defendant claims. In support of an effort to avoid the effect of the older deed, the plaintiff introduced undisputed evidence1 to the effect that the sole consideration which moved Eaines to execute the older deed to W. E. Walker was the conveyance to Eaines of certain property belonging to Walker’s wife, Euth D. Walker, and her minor children, Eitie Anna Walker and Lena A. Walker, their respective interests therein being a life-estate to Euth D. Walker and a remainder interest to the children, one of whom is the plaintiff in the present case. Under these conditions, when Walker took the legal title in his own name, the property immediately became impressed with an implied trust in favor of the wife and children, according to their several interests, as already stated-See, in this connection, Civil Code, §§3160, 3196; Adams Jones, 39 Ga. 479; Brown v. Doane, 86 Ga. 32; Hurst v. Commissioners, 110 Ga. 33; McKinney v. Burns, 31 Ga. 295; Holmes v. Holmes, 106 Ga. 858. The wife and children could assert their equitable title against the husband, W. E. Walker, and against any one claiming under him with notice. Civil Code, §3932.

But it was claimed by the defendant, Williams, that he was a bona fide purchaser for value, without notice of the plaintiff’s, equitable title. If he were such, he would be protected, and the plaintiff could not recover. Civil Code, §3934. The facts, therefore, lead to the inquiry, was Williams such a purchaser? The evidence is undisputed that he paid value. There is no evidence that the amount was not full value. Proof of such pajonent, in the absence of proof of notice, or of -any fact sufficient in law to charge notice, or sufficient to put the purchaser upon inquiry, will raise the presumption that his purchase was without notice, and the onus will be upon the one asserting an equity in the property to prove notice thereof to such purchaser. See, in this connection, Johnson v. Neal, 67 Ga. 528, where it is said: “Proof that a purchaser bought for value from the defendant in fi. fa. raises a presumption of good faith; and if it is desired to rebut this presumption by proof of actual notice of the judgment, the onus of proving such fact is on him who asserts it.” In Barton v. Barton, 75 Ala. 400 (cited in 23 Am. & E. Ene. L. 523), it was held that “the rule as to proof of bona fide purchase is, that the party pleading it must first make satisfactory proof of purchase and payment, it being affirmative defensive matter, in the nature of confession and avoidance; but this done, he need not go further, and prove that he made such purchase and payment without notice. The burden here shifts, and if it be desired to avoid the effect of such purchase and payment, it must be met by counter proof that before the payment the purchaser had actual or constructive notice of the equity or lien asserted, or of some. fact or circumstance, which was sufficient to put him on inquiry, and which, if followed up, would have discovered the equity or incumbrance.”. In Morimura v. Samaha, 25 App. D. C. 189, cited in 6 Cur. Law, 814, n. 69, it is said: “Where creditors attack a conveyance by their debtor as fraudulent, the grantee must show the payment of consideration, and then the burden is on the creditors to show that the vendee had notice of his grantor’s fraud.”

In order to prove that Williams at the time of his purchase had notice of the plaintiff’s equity, the plaintiff offered the testimony of several witnesses to the effect that they had informed Williams of certain “rumors” concerning the title; but in no instance does it appear that the alleged rumors bore any relation to the claim which is now asserted by the plaintiff. In that respect the record is silent. With the exception of one instance, it is not clear from the testimony of any witness that the rumors alluded to were communicated to Williams prior to the time of his purchase. In. one instance, however (see testimony of A. A. Walker), it does, affirmatively appear that Williams was told before he purchased that “the title was bad.” Further than this, the record of this witness’s testimony is likewise silent, and does not connect the criticism of Walker’s title with the claim asserted by the plaintiff. In the absence of further statements to Williams upon this subject calling attention more specifically to the title which is now asserted by the plaintiff, the mere general statement that the title was; bad was not sufficient to charge Williams with notice of the plaintiff’s equitable title. The title may have been bad in some other respect. If so, that would be of no concern' to the plaintiff in this case. The question is not whether Williams knew of some.other defect, but whether he. knew of the outstanding, adverse equity which this plaintiff now asserts. Williams may have known of numerous other defects, and at the same time have been ignorant of the claim asserted, by the plaintiff. In that event the knowledge of the other defects ought not to destroy the bona ffdes of his purchase, in respect to the claim of which he was ignorant. In Black v. Thornton, 31 Ga. 659, the trial court charged the jury: “A mere rumor brought to the knowledge of Eeuben Thornton at or before the sale, or general report, that there was an outstanding claim or conveyance, without defining what sort of claim or conveyance, to whom or by whom, etc., is not notice to Eeuben Thornton.” Upon review of that charge in this court it was said, Jen-' kins, J., delivering the opinion: “The law is here correctly stated. The proposition is a simple truism.” See also, in this connection, Ratteree v. Conley, 74 Ga. 153 (a). See also 37 Am. Digest (Century ed.), 1470, §5.; Raymond v. Flavel, 40 Pacific, 148. The testimony of the witnesses as disclosed by the present record does not go far enough to show actual notice of the plaintiff’s claim, or. of any fact connected therewith sufficient to have put Williams upon inquiry. Such testimony fails, therefore, either to show notice, or to render applicable the provisions of the Civil Code, §3933, with regard to charging notice where a person has knowledge of facts sufficient to put him upon inquiry.

. If the testimony of the witnesses was not sufficient to affect Williams with notice, what else does the record disclose tending to suclr a conclusion? It appears that the junior-deed which Eaines executed, to wit, the deed from Eaines to Euth D. Walker and Eitie Anna Walker and Lena A. Walker, and under which the plaintiff claims, recites the substance of a certain petition to the , superior court by W. E'. Walker and the judgment entered thereon, bóíh of which were duly filed in the office of the clerk of the superior court. The petition and order' clearly and fully set forth the: plaintiff’s interest in the'property, and the recitals of the petition in the deed referred’ to, if Williams knew of that deed, were sufficient, to impart notice' of the plaintiff’s equitable title. This tleéd was' executéd' in"1.893, before Williams'purchased in 1901. Ifi,Williams had notice-'either of this deed or of the proceedings ini théi superior' court, such notice'would be sufficient to charge him withriaotice'of the plaintiff’s equitable'title. There is no evidence, however, to show that he had actual notice of either, nor is there any evidence to show that he had actual notice of any fact sufficient to charge him with notice of either. The record before us does not disclose that the deed from Raines to Ruth D. Walker and Ritie Anna Walker and Lena A. Walker was recorded. In the absence of evidence to that effect, there is no presumption of law that it was recorded. This eliminates the idea of constructive notice by a duly recorded deed. The only remaining inquiry must therefore be addressed to the question of whether the record before the judge of the superior court in the matter of the application of W. E. Walker to obtain authority to have Raines execute the deed to Ruth D. Walker and Ritie Anna Walker and Lena A. Walker was of such character as in law to charge Williams with notice of the plaintiff’s outstanding equity. It does not appear that these proceedings were entered upon the minutes of the court, but it does appear that they were filed in the office of 'the clerk of the court, that they were regular in all respects, and complied with the requirements of the Civil Code, §§2545-6. The law requires the proceedings to be entered upon the minutes of court, and the presumption is that the officers did their duty. It may therefore be presumed that the proceedings did appear upon the minutes of court. So the question is finally resolved to the inquiry as to whether a matter of this character appearing upon the minutes of court is sufficient to charge notice of an outstanding adverse equity, to a purchaser for value from the holder of the legal title, who, at the time, was in actual possession. The doctrine of lis pendens will not apply, first, because there was no suit between the parties, and, secondly, because the matter had long been concluded in court before the purchase by Williams. See Civil Code, §3936. The record does not disclose knowledge by Williams, at the time of his purchase, of anything to indicate to him that the property had been before the court. Eor the purpose of giving constructive notice of deeds, the law makes provision for their record in the office of the clerk of the superior court of the county where the land lies' (Civil Code, §3618); and the law .makes it the duty of the clerk Of that court “to keep well-bound books for recording all deeds/ mortgages, and other liens and bills of sale separately.” Civil Code, §4360, par. 9. A deed can not be said to be properly re-' corded unless it be entered npon the book designated for that purpose. In Beverly v. Burke, 9 Ga,. 440, this court ruled that the fact that the deed “was recorded on the minutes of the superior court in the course of the proceedings instituted for its establishment does not dispense with the statutory requirement of registration.” One of the objects of the law in requiring deeds to be recorded being to charge constructive notice to persons who have not actual notice (Civil Code, §3618), unless the statute is strictly complied with there will be no constructive notice. It required an express statute to render the record of a deed constructive notice of the contents thereof. The record of a contract or a paper of any kind not authorized by law to be recorded is not constructive notice of what the paper contains. In order to admit a deed to record it must be executed with certain formalities. If a deed not executed according to those formalities be entered upon the proper registry as a recorded deed, it will not be notice to a purchaser for value. In Gardner v. Granniss, 57 Ga. 557, it is said: “When a deed is well recorded, everybody must be presumed to know of the record, for certain purposes; but where not well recorded, the presumption of ignorance holds, until actual knowledge or information of the record is clearly proved.” Under the statute, it is no less, important that the deed be entered upon the proper registry book than that it be properly executed. There has been no statute requiring that the entry of a deed upon the minutes of court, or that-a mere recital of a matter on the minutes of court, should, in the absence of actual knowledge of some fact sufficient to challenge inquiry, have the effect of charging constructive notice of a secret-equity to a purchaser for value. In the matter of specific performance, which may involve a proceeding where the doctrine of lis pendens may apply, it is expressly provided by the Civil Code, §4852, that “such decree, certified by the clerk, shall be recorded in the registry of deeds in the county where the land lies, and shall stand in place of a deed.” If the minutes of the court were sufficient to charge notice to all persons of the equities established by the decree, it is not apparent upon what reason express legislation was had requiring tbe record of such decree in the registry of deeds. We do not think that the mere registry of the proceedings in question uponThe minutes of the superior court was sufficient to charge Williams with notice of the recitals of fact contained therein. When Williams went to purchase from Walker, Walker was found m possession, and was presumably in possession as of his own right. Civil Code, §393l! There is a manifest distinction between this case and that line of cases where the purchase was from another than the person who was in possession. Viewing the case from every standpoint, as presented by the record, it does not. appear that the plaintiff has supported the burden of proving notice to Williams of the existence of her equitable title at the time-of the purchase by him. The plaintiff did not have the legal title,, because her grantor, Baines, having previously conveyed to the defendant’s grantor, had nothing left to be conveyed to the plaintiff', by the deed under which she claimed. The plaintiff could not recover upon the strength of her equitable title, for the reason that,, under the evidence as disclosed by the record, the defendant was. a bona fide purchaser for value.

2. Over the objection that the testimony contradicted and varied the terms of the deed, the court permitted G. C. Baines, the common grantor, to testify: “I made it to him individually, but with the understanding that it was not to be of force unless he procured, an order authorizing him to sell me his children’s land and let me-convey to his children this land in dispute.” It was competent,, by parol, to prove all the circumstances attending the transaction which would have the effect to charge the conscience of Walker and imply a trust in favor of those whose property constituted the consideration moving to the execution of that deed. If the land of Walker’s wife and children was the real and only consideration of the deed, while by taking the deed to himself he became the-holder of the legal title, yet in equity the wife and children were-the true owners, and Walker could be compelled to make them a conveyance, or recognize that he held the legal title in trust. But the parol evidence which was objected to did not go to that point. It was directed only to the legal sufficiency of the deed, and was. an effort to make it speak contrary to its terms. The deed was. unambiguous, and expressly conveyed present title. The parol evidence seeks to fix a future time and engraft a contingency with respect to the vesting of legal title. For that purpose the evidence, was not admissible.

Judgment reversed.

All the Justices concur.