Dennis v. Burritt

The opinion of the Court was delivered by Mr. Chief Justice Murray. Mr. Justice Heydenfeldt concurred.

In this case, it appears from the record, that Samuel Burritt mortgaged a lot in the city of San Francisco, to secure the payment of ten thousand dollars. The mortgage was duly recorded, subsequent to which, one Yogeley purchased a portion of said lot, and took a conveyance for the same, which was also recorded; after which Dennis, at different times, released his mortgage lien on different portions of the lot, which were sold to third persons. Dennis now seeks to foreclose his mortgage, and subject one small lot still standing in the name of Yogeley to the payment of his mortgage.

If Dennis had actual notice of Yogeley’s deed, then there is no doubt that he would be bound by it; but in the absence of notice in fact, it is urged that our statute imparts constructive notice, and that it was the intention of the Legislature to make the recordation of a deed or other instrument affecting lands, notice to all prior as well as subsequent encumbrancers.

The twenty-fifth section of the Act concerning conveyances, (Com[673]piled Laws, p. 517,) provides, that “ every conveyance certified and recorded in the manner prescribed in this Act, shall, from the time of filing the same with the recorder for record, impart notice to all persons of the contents thereof, and all subsequent purchasers and mortgagees shall be deemed to purchase with notice.”

It was perfectly competent for the Legislature to have made the recordation of a deed, notice to encumbrancers both prior and subsequent; but can that intention be fairly inferred from the Act? We have been referred to the numerous decisions of other States, a|l establishing the principle that a prior encumbrancer is not bound by any subsequent record, and that the same imparts no notice whatever. It is urged in opposition, that the recording statutes of those States are not as broad as ours, and only provide that the conveyance, when recorded, shall impart notice to subsequent purchasers and mortgagees; while our statute provides that the act of recording shall operate as notice to all persons. This appears to be true, so far as we have had an opportunity of examination ; but we are not aware, that any of these decisions have turned upon the point of the absence of general words like those contained in the twenty-fifth section of our statute. We think that the second subdivision limits the general words of the first part of the section, inasmuch as no penalty or consequence is declared, except as against subsequent purchasers and mortgagees, and if the construction contended for (that the recordation imparted notice to all persons,) be correct, it would be involved in this absurdity,—that such notice was only operative by the terms of the statute, as against subsequent purchasers and mortgagees. If, however, the act of recording imparts notice, independent of the consequence, as provided in the statute, and its effects are not limited by the terms thereof, it is at best but constructive notice, and therefore insufficient to charge a party with fraud necessary to set aside the Act in a Court of Equity, as the rule is well established, that it requires actual notice in fact to constitute fraud, or such acts in the premises as some positive statute characterizes as fraudulent.