Jeanes v. Hizer

Opinion by

Mr. Chief Justice Steerett,

This appeal is from the decree of the court below confirming the auditor’s report distributing the fund realized by the sheriff’s sale of defendant’s real estate. The fund in court was claimed by two mortgage creditors, each of whom asserted priority of lien. The auditor and court below awarded to appellee the full amount of his claim, with interest, on the ground that his security was in fact a purchase money mortgage. The residue of the fund was insufficient to pay appellant’s claim in full. Hence this appeal.

No exceptions having been taken to the auditor’s findings of fact, the question here is one of law alone. Briefly stated, the material facts are as follows: John Hizer died seized of the land from the sale of which the fund in court was produced. The Hizer heirs agreed to sell to one of their number, the defendant, for the consideration of $9,000, which included defendant’s interest therein. The conveyancer, deeming it desirable to keep the title undivided, prepared two deeds. One from all the Hizer heirs to Jacob Gf. Custor, dated March 31, 1883, and the other from Custor to the defendant, John Hizer, dated April 2, 1883. Both deeds were actually executed and delivered on April 2, 1883, as one transaction. While the deeds, in which Custor was named as grantee and grantor, respectively, recited the consideration as $9,000, no money changed hands. Custor was used merely as a conduit to pass the title. Andrew Hizer, the appellee, agreed to let his interest remain in the land secured by a mortgage for $1,800, to be a purchase money lien, but instead of drawing the mortgage to Custor, and having him assign it to Andrew Hizer, the conveyancer made it payable directly to Andrew, but inserted a recital that it was given “ for the better securing of the above stated amount of purchase money for the above described property.” It was dated April 2, 1883, and was executed simultaneously with, the deeds, but was not recorded until April 7, five days thereafter. For the purpose of raising the money to pay the other heirs their respective shares, defendant gave a mortgage to Charles and Isaac Johnson, on the same property, dated, executed, delivered and recorded on April 2,' 1883. On September 1, 1886, this mortgage was assigned to Isaac Johnson, and on March 28,1892, by Isaac Johnson’s executors to the appellant. The receipts in both deeds, respectively, acknowledge that the grantors therein had received the full amount of the purchase money.

Appellant’s contention is that, inasmuch as the chain of title does not disclose a purchase money mortgage, he is not visited with notice. This position assumes that a purchase money mortgage must be in the names of the vendee and vendor, in order to convey record notice; but the contrary was rdled in Albright v. Lafayette Building and Savings Association, 102 Pa. 411. Appellant also relies on the case above cited as authority for the position that the recital of payment of purchase money in the deeds and the difference in the dates and . names of the parties were sufficient to mislead them, and thus, under the circumstances, postpone the lien of the purchase money mortgage. It may be conceded that this would be so if the purchase money mortgage had contained no recital of its true character; but, in the face of the recital above quoted, this position cannot be maintained. None of the recitals is conclusive. Merely stating that an instrument is given to secure purchase money will not give it priority, if in fact the money is advanced by a stranger: Nottes’s Appeal, 45 Pa. 361; Dungan v. American Life Ins. and Trust Co., 52 Pa. 253. Nor is an acknowledgment of receipt of the purchase money conclusive; Watson v. Blaine, 12 S. & R. 136; Hamilton v. McGuire, 3 S. &. R. 355; Nichols v. Nichols, 133 Pa. 438, 455. The same is true as to the dating of an instrument: Jordan v. Cooper, 3 S. & R. 564, 580. While such recitals are not conclusive, they may amount to such notice as makes inquiry a duty. If appellant had searched the records he would have found appellee’s mortgage; and he would have been thus notified that it was for purchase money. The dates and the names of the parties were not inconsistent or conclusive, and proper inquiry would have disclosed the facts as they actually were. It is not universally true tliat “a purchaser may content himself with the inspection of the records.” There are many facts outside the record about which he must inquire or suffer the consequences. Whatever puts a party upon inquiry amounts to notice, provided the inquiry becomes a duty; as in the case of purchasers and creditors where the inquiry if pursued would lead to knowledge of the requisite facts.

It is unnecessary to pursue the subject further. Enough has been said to show that the conclusions reached by the auditor and court below were substantially correct.

Decree affirmed and appeal dismissed at appellant’s costs.