Miles v. Miles. MILES V. MILES. (6 Oregon, 267.) Deed subject to mortgage — Consideration · - Creditors of grantor. Where a grantee accepted a deed reciting that the estate conveyed was subject to a mortgage, and subsequently paid the mortgage, but gave no other consideration, held, in the absence of fraud, that this constituted a valid grant as against any creditors of the grantor. CRED REDITOR'S bill to set aside a deed. The facts sufficiently appear in the opinion. Catlin & Killen, for appellant. T. A. McBride, for respondent. WATSON, J. This suit comes to this court for trial anew on the pleadings and evidence forming part of the transcript. The decree of the court below sustains the mortgage in favor of defendant Girard; and as neither party appeals from that part of the decree, it need not be considered by us in this opinion. The first and most important question in this case, upon the decision of which the case mainly depends, is this: "Does the fact that the deed from Spencer D. Miles to Laura R. Tredeau, which is attached in this suit, recites and expresses that it is taken subject to a mortgage for the sum of five hundred dollars, which said Laura R. Tredeau afterward paid, constitute a valuable consideration for the deed?" That the deed does so recite, and that she did pay that sum with interest, is alleged in the answer, and not denied in the reply. This question is important, because the complaint, while it charges that defendant, Spencer D. Miles, intended by the deed in dispute to defraud plaintiff and his other creditors, neither directly nor indirectly charges that said Laura R. Tredeau was a party to that fraud, or that she had any knowledge or notice of the fraudulent intent of her grantor. The deed is attacked solely upon the ground that it is a voluntary conveyance. On the other hand, defendants allege no other consideration than the said mortgage and its payment by defendant Laura, and they attempt to prove no other consideration. Miles v. Miles. We are not prepared to argue with counsel for appellant in the proposition, that when a deed recites that the premises therein conveyed are subject to a mortgage, the grantee, by accepting the deed, binds himself personally to pay the debt secured by the mortgage. The authorities fully sustain the proposition, that when the deed not only recites the mortgage, but adds that the grantee assumes it, he is personally bound if he accepts the deed. 1 Hill. on Mort. 357; 7 Cush. 133. This obligation the law implies without any express promise. 9 Mass. 510. We think this is as far as the cases go in support of the theory that by accepting a deed, which expresses that the estate therein conveyed is subject to a mortgage, the grantee becomes liable to the mortgagee personally for the debt secured by the mortgage. But while we hold that the mere acceptance by the grantee of a deed which expresses that the estate which it conveys is subject to a mortgage, will not render the grantee personally liable to the mortgagee for the mortgage debt, we are of the opinion that if in such case the grantee shall pay off the mortgage, such payment will, in the absence of any further explanation, be taken as a payment of so much of the purchase-money for the premises, and it will be a valuable consideration sufficient to uphold the conveyance. In this case the deed, in addition to the usual parts, contains a clause reciting that the premises are subject to a mortgage for five hundred dollars. Such a construction should be given the instrument as will give effect to all of its parts according to the intent of the parties. It is evident that at the time of the execution of the deed in dispute the grantor thought of the mortgage, and caused a clause, reciting that the estate was subject to it, to be inserted, in order that the grantee might have notice of its existence, and might know that she could only enjoy the estate granted upon the condition that she could pay it off. We think that by accepting the estate upon this condition, while she did not render herself personally liable to the mortgagee, she at least placed herself in a position such as that she must lose the property or pay off the mortgage. Under these circumstances she actually did pay the mortgage, amounting, with interest, to the sum of five hundred and eighty-four dollars. Spencer D. Miles thus actually received, by the payment of the debt which he owed the mortgage for the land, the sum of five hundred and eighty-four dollars, and the defendant Laura R. Tredeau actually paid that snm for the lap→ We think that when Spencer D. Miles made and Laura R. Tredeau Moore v. Fuller. accepted the deed, to set aside which this suit was brought, it may be reasonably presumed that they intended that she should pay off the mortgage, which the deed recited was upon the land, and that they intended that such payment should be deemed a payment of that amount of the purchase-money. It is not necessary for us in this case to decide whether or not, as between Spencer D. Miles and Laura R. Tredeau, the said Laura, by accepting the deed in dispute, became liable to indemnify him against the mortgage, expressed in the deed to be a lien on the estate. That she did in fact pay it is, under the circumstances, in the absence of any proof of actual fraud, a sufficient consideration to uphold the deed. A number of other questions of law and of fact are presented by the transcript, but as our views expressed as to the sufficiency of the consideration are decisive of the main question in the case, we deem the examination of the other questions unnecessary. It follows that the decree of the court below must be reversed, and that this cause must be remanded, with direction that the complaint be dismissed. Decree reversed and cause remanded. MOORE V. FULLER. (6 Oregon, 272.) Mortgage-When married woman may impeach-Consideration for mortgage. Where a married woman, as surety for her husband, freely joined with him in executing a mortgage on her separate property, understanding the character of the instrument, she cannot after delivery avoid it for fraud of which the grantee was innocent.* A precedent liability is a sufficient consideration for a mortgage. Liability for another on a contract in force is a sufficient consideration for a mortgage. SUIT UIT to foreclose a mortgage. The facts are stated in the opinion of the court. John Kelsay and L. Vineyard, for appellants. F. A. Chenoweth, for respondent. * See, also, Kerr v. Russell, 18 Am. Rep. 634; Heeter v. Glasgow, 21 id. 46; Singer Manuf. Co. v. Rook, 24 id. 204; Johnson v. Wallace, id. 699. Moore v. Fuller. MCARTHUR, J. This is a suit in equity to foreclose a mortgage. The record shows that on May 1, 1874, A. Fuller, James O. Fuller and T. M. Fuller made and delivered to one Reed a promissory note for the sum of one thousand dollars, with interest at one per cent per month, payable one year after date without grace. John W. Moore, the respondent, became surety on said note. The note was not paid at maturity. Reed demanded payment, and the Fullers not being able to raise the money without stripping themselves of property necessary to carry on their business, it was agreed between Moore, the surety, and the Fullers, that if they would secure him, he would pay the note, and give them time to make the money. Accordingly, said A. Fuller and Mary A. E. Fuller, his wife, in consideration of Moore's advancing the money to pay Reed and extending the time of payment, executed to Moore a mortgage upon certain real property, which was the separate property of said Mary A. E. Fuller. Moore paid the money to Reed, and took an indorsement of the note. The note remaining unpaid, this suit was brought to foreclose the mortgage, the Fullers having in the mean time become insolvent. The testimony certified up with the transcript clearly establishes the making and acknowledgment of the mortgage to secure Moore, that he gave the Fullers time, from the date of its execution until the commencement of this suit nearly six months; that the land mortgaged was the separate property of Mary A. E. Fuller, and that her husband joined her in the execution thereof. The testimony in relation to fraud in procuring the acknowledgment, even if relevant, is wholly insufficient to warrant the conclusion that any improper means were resorted to to induce Mrs. Fuller to execute and acknowledge the mortgage. But it is not relevant, for there is no allegation in the answer of fraud, in relation thereto. It will be found, that the certificate of the officer to the acknowledgment of the mortgage deed appears on its face to have been in substantial compliance with the statute, and that the evidence to impeach it was wholly parol evidence, and we decided, in Dolph v. Barney, 5 Or. 205, that such an acknowledgment could not be impeached by parol evidence unless there were allegations in the pleadings to warrant it. Furthermore, if there was fraud therein there is nothing to show that Moore participated in it, and the law is, that if a married woman of sufficient mental capacity, without duress or misrepresentation as to the nature of the instrument, joins her husband in the deed, and suffers the Moore v. Fuller. deed to be delivered, she cannot avoid it on account of fraud and misrepresentation, without showing that the grantee knew of or participated in the fraud. White v. Graves, 107 Mass. 325; s. c., 9 Am. Rep. 38. The rule applies to mortgages as well as to deeds absolute. [Omitting a minor point.] We come now to examine the most important question presented by this record. There was no consideration passing to the mortgagors at the time of the execution of the mortgage. The consideration was the pre-existing liability of the payors of the note heretofore mentioned to the surety, Moore. Is a pre-existing liability a sufficient consideration to support a mortgage? This question has been differently decided by different courts. Mr. Justice STORY, 2 Eq. Jur. 657, 658, 9th ed., holds to the affirmative, and bases his opinion on Mitford v. Mitford, 9 Ves. 100; and Bayley v. Greenleaf, Wheat. 46. In White and Tudor's Leading Cases in Equity, vol. 2, part 1, p. 73, it is said "similar decisions were made in Richeson v. Richeson, 2 Gratt. 497; and in Dey v. Dunham, 2 Johns. Ch. 182." It will be found, however, that the courts of New York have not followed the case of Dey v. Dunham, but have since that decision uniformly held that a pre-existing debt or liability is not sufficient consideration to uphold a mortgage. Chancellor KENT, however, 4 Com. 154, regarded a pre-existing debt or liability sufficient to support a mortgage. In support of the doctrine, he cites Roberts v. Salisbury, 3 Gill & Johns. 425, and Gann v. Chester, 5 Yerger, 205; and he thought the principle rested upon grounds which would command general assent. Jewett v. Warren, 12 Mass. 300, and Babcock v. Jordan, 24 Ind. 14, are to the same effect. Indeed, the weight of authority is in favor of the affirmative of the proposition, and to that we give our assent. Connected with this there is another point deserving of attention. The mortgage was executed May 3, 1876, and Moore paid Reed the amount of the note May 6, 1876. This fact is the basis of the further claim of appellants' counsel, that Moore's liability is not sufficient consideration to support the mortgage. In Jewett v. Warren, supra, it was distinctly held that a liability for another on a contract in force is sufficient consideration for a mortgage or pledge. So we decide. Decree affirmed. |