!
'\' '
,
'
' _.,
-·
per
of
do'
PASCAULT 'lJ. COCHRAN.
«(Jircuit (Jourt, D. Delaware. March 2, 1888.)
MOR'l'liAGES-RECITALS-CONCLUSI:VENESS.
A niortgage on land in Delaware, given as additional security for the pur· chase price of land in Maryland, was dated July 28, 1871, and recitl!d that the deed from the vendor and the purchase-money mortgage bore date both, and were delivered both, on thAt day. Held, on bill to foreclose the Delaware mortglip;e, that the recital as to da.tes was not conclusive. and, it being shown that both mortgages and the deed were delivered, all three simultaneously, August 0, 1871, parol evidence was admissible to show that. the three instru..' ments formed one transaction.,
a.
2. I>:mED"':'OF BARGAIN AND SALJll"":'OMISSION OIl' BARGAINEE-CONSTaUC'TION. In; Delaware. where the common m:ode of assurance' is II deed of bargain and sale operating under the statute of uses, the words in II deed, and sells,unto the sole and separate use of the !laid P.," will be construed, in eqility,when the intention of tl;le parties is clear, to mean" bargains and sells untop.., and to the only proper use and behoof of the said P.;" and such a <lead will .re.formed to. earn> that intention into e f f e c t . . VENDOR".UiD
. .A contained the usual covenant for "furiher assurancea·." recited,tHat grantors' title was'under a certain will and proceedings in pariition , in court. As security for the purchase. money a mortgage was taken on the land; and, as security for that mortgage, the purchaser's father gave a mortgage on other land of hie o.wn. After the deed and were delivered, it was discovered that the orphans' court had no jurisdlCtion to
POR VENDRE-.,-RELEASE BY NEW
PASCAULT 11. COCHRAN.
359
make the allotment under the will. The vendoTlJ,whobd aright to thefeesimple In the land, anll wh.o had made no intentional misrepreselltations. thereupon, of $eir own motion, secnred qnitclallils from ·all interested; and made the purchaser a good title. Held, on bill to foreclose the mortgage frOm the father, that t!J,e fatber'sobligation as surety was not discharged, being made to appear that he had suffered any loss or injury, and the execution of the "further assurance" not constituting anew contract. 4. SAME-FoRECLOSURE OF PURCHA.SE:MoNEY MORTGAGE-ApPOINTMENT OF CEIVER.
RIl:-
.,
o.f a n;lOrtgagegiven as additionallecuritv for the payment of a porchase-mQney mortgage is not discharged by the. fact that a receiver been appohl'ted in the suit to foreclose the porchase-money mortgage at the instance ·of the. mortgagee, and .with the consent of the porchaser; such an not changing th.e .title to or creating any lien upon the land. or glVIDg any advantage or priorIty to the mortgagee. li. SAME-DEPRECIATION IN VALUE OF LAND. A sariousdepreciationin the value of land after the time of its purchase, the vendor and;vendee havinlf bargained on equal terms, in the absence of proof of fraud, misrepresentatIon, or concealment of any material fact on the part of the vendor, lly which the purchaser was betrayed into an unfortuthe surety of the latter. nate speculation. will Dot
In Equity.
Bill. to foreclose a mortgage.
Philip F. Thomas and Wm. O. Spruance, for complainant.
AlexanderB. COoper andG6f¥ffJ6 Gray, for respondent. WALES, J.. This is a suit to foreclose a mortgage given by William A. Cochran, the defendant, to Catharine H. Pascault, the complainant, as additional security for the payment of 840,000, that sum being the purchase mOiley of a farm in Cecil county, Md., called "Greenfield," containing about 288 acres of land, which the complainant and herhusband (now deceased) had sold and conveyed to Henry S. Cochran, the son of the defendant. The history of the casc, as gathered from the bill, answer, and proofs, is 88 follows: In the early summer of 1871, the complainant, being the owner in her oWn right of 272 acres of "Greenfield," and her husband owning the remaining portion, they entered into negotiations with Henry S. Cochran and William A. Cochran for the sale of the farm, and it was finally agreed that Henry S. Cochran would become the purchaser for $40,000. As the sale waS entirely on credit, no cash payments beitig required or offered, it was further agreed that, in addition to HenryS. Cochran's mortgage of "Greenfield" for the Whole amount of purchase money, the defendant should also give a mortgage of his on which he was then residing, in New Castle county, Del. In this agreement, the complainant and her husband, by deed dated August 5,1871, conveyed "Greenfield" to Henry' S.Cochran, and the latter at the same time gave his mortgage of like date, to the complainant. On the same day, and at the Same plaee, 00wit, on the 5th bfAi.lgust, at the town of Elkton, where and when the transaction just mentioned took place, the mortgage of William A. Cochran', the defendant,lind his wife, dated the 28th oIJuly, 1871, was delivered to the c()mplainant. The deed and the two mortgages were all intended to be of even date, the mortgage of the defendant, as alleged in the bill, being a part of the consideration, without which the conveyance
360
FEDERAL REPORTER.
to Heriry So' Coohran would not have been made, The principal debt was made pl\yable byinstallroents; at intervals of two years, beginning on the let ofJanuary, 1872, with interest payable half-yearly, the last due until Januar.v 1, 1892 .. Henry S. of the installments not failing to pay the on his debt after the 1st of January, 187. , and, having made defauij igthe payment of all of the installments of principal due up to that time, the complainant, by her husband and next friend, the 20th of Auguf3t,1878, brought a suit in the equity "lide of the circuit court for Cecil county , praying for a decree of sale under the "Greenfield" mortgage tosatisty her claim. This suit was resisted by Henry S. Cochran, who'filed a cross-bill alleging that the complainant and her husband, at the time of their conveyance of" Green;field" to him, did not have a legal title to tha.same, and praying that his mortgage might becanceled , and he be released. Thereupon the complainant and her husband tendered to Henry S. Cochran a deed, dated October 26, 1878, perfecting the title, and curing the alleged defect, which he refused to accept. On the 11th of June, 1879, a decree was rendered by the court dismissing the and directing a sale of'the inortgaged premise80n a day named, unless the claim of the complainant should be satisfied jund' in event the decree should stand as security for the payment of future installments. This decree was appealed from, and sorouch thereof as dismissed the cross-bill was affirmed by the court of appeals of Maryland. 1 "Greenfield" was afterwards sold under the order of the circuit court,whi'oh ,distributed the proceeds of sale, and, after deducting credits arising from this source, there is now due from Henry B.. Cochran foul' instalhl1:ents of principal, with interest, making the aggregate surq of $25,766.35. After filing herbill, on the 20th of August, 1878, but prior to the decree thereunder, the court, upon the apphcation' of the complainant; and with the consent of Henry S. Cochran" appointed a receiver of the rents and profits of "Greenfield," pending the suit. William A. Cocbranwas duly notified of his son's and also informed of the legal proceedrequested to make it good, and ings in Maryland, and advised to take such Wj;lasures as he saw tit to protect his interests. Henry S. Cochran is insolvent. So far the facts are undisputed. The bUlprays that an account may be taken oithe amount due to the complainant under the mortgage of Henry S. Cochran and payable by the said William A. Cochran under the terms of his mortgage, and for a decreeagail,lst William A. Cochran, the defendant, to pay the same, with costs, by a day to be named in decree, and in default thereof that the lands ,mortgaged by the defendant be decreed to be sold for the amount found to be. due, and that the said may stand as security for the other installments of principal and interest payable by the .said Henry S. Cochran as the sam.e shall respectively ture. ' In behalf of the defendant it is contended that he is not liable as surety for the performance b;y his son of the'latter's contract with the complain-
on
I'ASCAULT '/I. COCHRAN.
361
ant, of August 5, '1871, because the mortgage now in suit was given to secure the performance another and different contract, to-wit, one be.'lring date the 28th of July, 1871. The defendant insists upon his E'trict right to stand upon the precise terms of his guaranty as a surety, and without doubt he is entitled to have his claims, in this respect, fairly considered. His mortgage to the complainant sets out with the following recital: "Whereas, the said Francis Pascault and Catharine C. Pascault by deed dated the 28th day of July, 1871, conveyed the land and premises in Cecil county, Maryland, therein described, unto Henry Cochran, and took from said Henry Cocqran and Annie, his wife, a deed of mortgage of the same lands to secure the payment of forty thousand dollars; the purchase money therefor, in installments as therein set forth, [then follows the conveyance from W. A. C. and wife toC. C. P.:] provided, that if the said Helll'yCochran, his heirs and assigns, pay and satisfy the said purchase motley of forty thousand dollars and interest in installments as the same become due· and payable, then this deed to be void." . The reply to this defense is twofold-First, that the defendant's mortgage, although dated on the 28th of July, was not delivered to the complainaIitl'until the 5th of August, from which last day only it took effeot; and, setJO'I'l.dly, that parol evidence being admissible to prove and correct a mistakehi'the recital of a deed, it has been conclusively shown that the deed and mortgage of August 5th are the identical ones referred to in the defendant's'mortgage of July 28th, and that this fact was well known to the· de(endant.at the time of the delivery of the iostruments, and flU bsequentIy confirnled by his own kdmissions. On the question of delivery the testhnony .of thepal:ties isbontradictory , the complainant being clear and positive in her reconection that the defendant's mortgage was handed to her for the first time on the 5th of August, while the defendant states that immediately on the execution Of his mortgage, on the day of its date, he delivered it to the complainant's husband, who, as her agent, was authorized to receive and accept it. The mortgage now in suit was signed and acknowledged at the defendant's residence, in Delaware. Mr. Pascault and the defendant's wife, who were present, are both dead. Henry S. Cochran, who was also present. has not been called as a witness, and the notary who took the acknowledgment testifies that several years afterwards the defendant asked him what he (the defendant) did with ;the mortgage on the day of its execution, thus indicating some doubt in his own mind about the actual disposition of the paper. The com,plainant admitsthat her husband was employed by her to conduct the sale of "Greenfield," but that nothing was dOl16in relation to it without her knowledge andcol1sent. Assuming, therefore, that the complainant, being at the time a feme covert, had the power to authorize her husband to accept the mortgage, there is no evidence that she delegated this special authority to him, or that she had knowledge of the delivery at that time,and ratified it. Under such circumstances, as was remarked by an eminent judge in a recent case, (Blair v. Shaej'er, 33 Fed. Rep. 227,) "regard must be had to the inherent probabilities based upon the situation of the parties." It must always be remembered; for the proQf is clear on this point,
'362
'FEDERAL·REPORTER.
that the defendant bore an active part in all the; t;tegotiations which le<l up to the sale <or-ccGreenfield," that he met his aon,:onmore that;!. onfl occasion, at "Greenfield," in the, presen'ce of the Q0IUpiainant and her husbl,\nd, when the subject of the-.sale and its terms were underconsideration; that he executed his mortgage prdm'ptly, and without questioning, on the dayIit was submitted to him for that' 'purpose, showing that the whole business had been prearranged and was fully understood; and :finally that he met the paniesat Elkton, on the when the 'sale was consummated by the exchange and delivery, of the deed and the ·two .. These facts are 1111 in decl8;ratJon. saw the defendant's mortgage fdr the first hme on ,,,,as, t? and it is by 'an improbable infe,enw 'tnatJhe defendali.t ol'his son.llad kept, possession oqt up to that time" It is not uncomdlon for' a deed of conveyance .and of a mortgage' for the purchase money to be of different dates; . Each takes effect, however, as a general rule, from the time of its delivery. The date is only presumpthreevidence ot the time of ;the presllmption may be; rebuttea· by. parol, QllQ, rW hen this has Paen done, the and regarded ··aEl parts or thesRPle transacti9n. .Marburryv. BrU:n, 15 Pet.? 21;. Parmelee v. Simp8W/.,5. Wall.8!; Lamb v.;. Can,nPn, .38 N. J. Law;B62jPorler v. Buckingham, 2 Har. 1 JOri,6S, Mprtg.. § 84j ·1 Gooenl. Ev. § 568a, nt>te,. : d.' In liGtUv.:Cazenovl1, 4 Eastji4$I:,.:Lord.ELYiIl<NlBPROVGH . . "It iaquiteimmaterJal when Jt(the deed) was indented. and equally-so ,wheniltl was made, by ·whicb it.m"y was written. Then the .,word is 'concluded.'and II deell can ()nlY bi;l said to be cpnia 4elivered. of delivery, hnportant time when It,tllltes etrect as a deed." ,And,s:uchJ:has ,always been the law·. There being satisfactory evidence .that :the of all W.s that defeQdant's mortgage was the time of the sale, as additional security for the purchase -UilQney.of "Greenfield," the .eitcnmstal,1tial proof: of its delivery on the .5th. of August is equally cOllcluflive, and it became valid and .effectual :from that day, and not i , The timeo! deli:very being Mcertained. there isstill .less. difficulty. in applying,this mortgage to the purpose for which it'wlls given., The rule .thai ,parol .evidence is inadmissible. to contradict 01: ¥ary the terms of a writtencon"tract, is founded-on the presumption that the whole engage.ment·ofthe·pal'ties and the and mamler of their undertaking, were 'reduced to.writing, and that there.fore any oral testirp.Qny Qf a previous ,colloquium, br of conversations or declarations fl,t the time when it was eompleted,orafterwards, would tend to substitute a new and different contnact for the one which was really agreed upon,tothe possible prejudice' of, .one ,of the parties. . But .there are well-recognized exceptions to this igeneriihmle,and it ·hasbeen well settled by repeated adjudications that parol evidence will be admitted to contradictor explain an instrument.iq.someofits recitals offaets; 1 Greenl·. and notes. Thus Bupra, the plaintiff waa permitwdto prove tbata deed 1}:""" ',: "" !O' '., ,
j
aes was madeand,conclilded·:on' a day subsequent to that on which the ,defld itself stated:on theface of itJD .have been made. In Johns v. Ohurch,12 Pick. 559, the recital in a mortgage called for a Dote of $236, and the 110te offered in evidence. was for $256. Parol ptoof wa;s admitted to prove that the note produced was the one referred to in the mortgage. In Hallv. Turell, 18 Pick. 455, there was a discrepancy between the 110te recited in the mortgage and the one produced, and evidence was allowed to show a mistake in date, also that there was no other note between the parties, and that the note offered was the one referred to in the The court there held that parol proof of such facts came within the principle of parcel, or not, of the premises intended to be conveyed. So, in Hough v. Bauey, 32 Conn. 292, parol proof was admitted to prove the identity of the note recited in the mortgage. In Jmws v. IndemniJ.y Co., 101 U. S. 622, the court, speaking through :Mr. Justice SWAYNE, says: . "It is common learning in the law that parol evidence is admissible to show that a deed absolute on its face is a mortgage; to establish a resulting trllst; to show that a written contract was without consideration; that it was void for fraud, illega;lity, or the disability of a party; that it was modified as to the time, place, or manner of performance, or otherwise; also to show the situation of the parties, and the surrounding circumstances, when it was entered into, and to aVply it to its subject. * · These are but a small part of the functions such evidence is permitted to perform." In supportdf the d{the court in that case he cites Shei:rraa'v. Craig, ''J'Cranch,34; where Chief Justice MARSHALl, says: ..It is true thilt the real transaction does not appear on the face of the mortgage, ' * * but if, on il1\;estigation, the real transaction shall appear to 1)6 fair, though somewhat variant from that which is descl'ibed, it would seem to be unjust and unprecedented to deprive the person claiming under the deed ofIlis real equitable rights, unless it be in favor of.a person who has been in fact. injured,by tbe. misrepresentation." Parol evidence to identify thesubject.matter of a written instrument is always admitted. De C01y. Guar. 156; Id. 180, 181. There is no pretense that it was not the intention of the defendant to become a surety. for his son, nor is it disputed that a deed takes effect from the time of.its delivery only, but it is claimed that the a.ctual delivery of defendant's mortgage was on tpe day of its date, and .that it cannot be made by parol proof to apply to his son's mortgage of a subsequent date; The evidence does not sustain this contention. There can be no reasonable doubt that defendant's mortgage was delivered on the 5th of August, that it took effect on and from that day,and that it was· contemporaneous with the execution and 'delivery of the jnstruments mentioned in its recital. And the law.is equally clear that parol proof may be admitted to contradict or explain; the erroneous recitals,in a deed, whenever it becomes necessary, in order to ascertain transaction between the parties. . . . J' . The defendant also relies on the defective titleof COmplainant an4 htwband t(), relieve him from liability. It is admitted that on4t1iust 5, 1871, Mrs. Pasca,llt and her.l;lUsbund did not the legll1 to Of to any part of it, but it is not disputed thllt
364 her husband;'hlld at that time a right to a.fee-sitriple title in the premises conveyed; that there was nofntentional misrepresentation of any fact on her part; and that the origin and description of the title were fully recited in their deed to Henry S. Cochran. The Pascaults' deed sets out that their title was under the will of Mrs. Pascault's mother, and proceedings in partitioll in the orphans' court of Baltimore city, Mr. Pascault having bought his .portion of "Greenfield" from one of the devisees; but ittumed out that the orphans' court had no jurisdiction to make an allotment under the will; and as soon as the defect was discovered, the complainant and her husband obtained a conveyance from all the other parties interested, by which the legal title was vested in them, and they thenexacuted and tendered a deed for the same to HenryS, Cochran. 'The deed of August 5th contained a covenant on the part of the grantors to "execute and deliver or procure to be executed and delivered such other and further assurances as may. be necessary to secure said lands." 'The court of appeals of Maryland decided that the new deed, 26, 1878; cured all of titlej holding that there had p.eep p.o fraudulent or purpose on the part of the vendors; that Henry no injury or daulage by the defect; and from the fact that the source of title. was disclosed to the vendee, as stated on the face of the deed, it was evident that both parties supposed the partition referred to was valiq. and effectual to convey in severalty the it was a case of parts allotted to the several devisees, and that mutual mistake as to a question of law. Cochran v. Pascault, 54 Mil. 1. 'rhe opinion of .the court in that case is an able O:1e, and is conclusive of the que8tiou of title between the parties to it, and the counsel for the defendant here do not seek to controvert the correctness of the decision. The defense on this point is that under the deed and mortgage of August 5th there was really no contract created between the complainant and Henry S. Cochran, because at that time a fee-simple title had not been conveyed to him, and therefore no obligation existed on his part for the payment of the purchase money, and that it was not until "a new and distinct agreement" had been made between the creditor and the principal debtor,by which the ti.tle to "Greenfield" was really conveyed, that the obligation to: pay the purcliase money became valid; that the conveyance of the fee by the deed of August 5th was the consideration of the defendant's gUM'tlnty, and the failure of that consideration discharged him· as surety. It will be noticed that this branch of the defense assumes two things,-that Henry S. Cochran was not liable under his mortgage, because no debt had been created by it, and that before he CouIn be made so liable it;became necessary to makes. new and distinct Mntract between him and the conlplainant,-which was a variation from the ;tern1s of the original one. In Miller v. Stewart, 9 Wheat. 681, the rule governing the liability of sureties is lucidly and concisely stated by Justice SroltY, who, speaking for the court, said: . "Nothing can be clearer, both upoilprinciple and authority, than the doctrine that the liability of a surety is not to be extended by implication beyond the terms of his contract. 'fo the extent, and in the manner, and under thlj
PASC.A.t1LT 1'. COCHRAN.
865
clrcumstances pointed out in; his obligation, he is bounet and no further. It is not sufficient that he may sustain no injury by a chlloge in the contract, or that it may be even for his benefit. He has a right. to stand upon the very terms of his colltract, and if he does not consent to any variation of it, and a variation is made, it isfatal.A.nd courts of equity, .as well as of law, have, been in the constant habit of scanning the contracts' of Rureties with considerable strictness. ... ... ... All the authorities proceed upon the gl'Ounu that and is not the undeltaking of the surety to receive astrict to lle extended beyond the fair scope of its terIns." The opinion of the court in that case was not unanimous, but the coneluding sentence may be accepted as formulating the general rule. , Now,what were the precise terms of the defendant's guaranty? Simply, that iJ consideration of the conveyance by the complainant and her husblmd of" Greenfield " to Henry S. Cochran, and of the latter's mortgage. for the payment of the purchase m,oney, the defendant becamea guarantor for the payment of that mortgage, according to the' terms conditions of the contract between Henry S. Cochran and the complainant. Itig urged on behalf of the defendant that his contract was made on the basis of a fee-simple title having been conveyed by the deed of August5th,and,as that was not done until long afterwards, he should be discharged. But this argument takes no account of the covenant for further assurances. It is not'denied that at the date of the first deed the grantors did not possess the legal title, although they had the right to have such a title. What they did grant by the first deed was all the title and right they then possessed, believing that they held the fee, but, to guard against all mistake. and to provide for the curing of all defects, they, at the'aame time, and by the same instrument, covenanted with Henry S. Cochran, his heirs and assigns, to make such further assuraneesas might become necessary to secure a good title. The deed of October 26, 1878, was in fact nothing more than a carrying out of the original agreement,-a performance of the covenant that if the deed of August 5th should prove to be insufficient to convey a fee, the com· plainant and her husband would make it good by another conveyance. They did voluntarily what they could have been compelled to do by iii wurt of equity on a bill for a specific performance of their covenant, equity holding that to be done which the parties had agreed should be done. It cannot be truthfully asserted that the deed of October 26th was a variation from the original contract between the grantors and' gran· tee of" Greenfield," when itwas actually made in compliance with thE! terms of that contract, which otherwise would have been violated by the refusal or the inability of the grantors to execute and. deliver that deed. The covenant for further assurances was an essential part of the first need, and bound all the parties to it. Such a covenant has always been held to be of great value to a purchaser. It relates both to the title of: the vendor, and to the instrument of conveyance to the vendeeiapd operates as well to secure the performance of all actE! for supplying any defects in the former, as to remove all objections to.the sufficiency. and.seo eurity of the latter. It runs with the land whenever there is apriv.ity ofestate between the contracting parties, and imires, not only to the ben-
368 efit of,the,nNlt . purqnaser,,·but take titJ,e.{rQll) him, ,Platt. Cov;M0'461; io; Oochranv. PaIloa'idt; !8'Upra, in;consid.. erinlr'tlteleft'ect· of hi' the Pascaults' deed' of August; 5th, , "In, case, l;!owlfJ"rr" demand for,a spellIfic perform" ance; P% ,thevendors·. u-nder their COVet1ant, and at their own c<¥!t"effectually cU,red bill for r!lsclssi6n could be brought to Ii. hearing. It ,tp is an element Of lnutualltyin such a covenant, lind that in this case the parties, by giving and receiving a deed with these recitals and this coventmt,mttst have contemplated this very ac· tion 011 the!pl\;J;t'of.tbe vendors. l1hecovenant, while it secured the a right law for damag.!'!B, .far: breach of it, and a right to enforce inequity to the vendors the right, if they so chose, to act. under,it voluntarily; all they have done, and to cure the defect in the recited title as soon as it'wastlisc!>vered. We have lio doubt whatever oe'their rightsoto aet;and with6ut tiollsideririgother grounds of objection, to the cros8"bill, we hold tbattb'e,Ctll!ing of the defective title is a complete barto the relief for, uule.ssthe complainants 'llave shown that they have suffered, ·some loss, by tbe delay in perfecting the t 'tle...'" . ;! ;.' II :,.' ;The reasons,llssigned for thejl;ldgmeni of the court. In that are consistent withig60d,sense and The vende,e was attempting to repudiate a ,d·ebt on accountof;an, alleged defect in the contract by which it had been created,but .the ICQurt jl;lstly held that as the contract had provided for the curingofsuch;defect"and the same had been cured without anyJo!lsordamageto thevenqee, the latter could not be released:., How, then, :cantbe vendees l:itllety!be Qnthe terpretation of his, undertaking, will tt, in the language of;rudge STORY. 'be extending it beyond the fair s.cope of its terms to hold,him liable? There was. as' has 'been ,shown, actually no such variation in the original con-; tract between ,the creditor and the ,principal debtol',llS wO,uld discI.large the'surety under ,the rule laid down by the supreme court in MiUer v,. Stewart, Nothing was done f'Qrhi$< benefit or injury, l\nd he suffered pp loss or damage. What his position h!J,d .the origim4 contract between the complaillltnt'andHenry S. Oochran never beeq.carried out and completed. is a,differentquestiotlj bqt,looking at exil'lt.. ing 'tacts,ahdnot considering contingencies which. ,never happeneq. jt does not appeal' that the relatiPt)Bbe1iween the parties were changecrby the deed of October 26th inaucb'mamler, ortQ\suchan extent, astl) justify,a, courtbfequity iIi discharging the surety. , ".' Another objection urgedin:behalfof the defendanti!ltllat the appoint'!' ment of areeeiver, iat the insta,n<leof the con1plaina:nt, and :wlththe con: sent of'Henry S. Oochran, duringAhe pendency ofthe suit ,in Maryland, bywhiuhdHenry Cochran was to be considered and n(Jt as theowher" of"Greenfieldj" to·whilch appointmel)t this opt no,·consentjexpl'ess or gischargeshim, But .howlloul'Hhisappointmenthave,opera1ed toelluanger: th.e rights pf the the degree of aQyl'espect Ilsa.8uretyl'l' ItwRs the duty,of the complainant·to of the .bI1iginal·debt. It was fQl'theinterest .of. the ;4efendant I
' ' . f.:,.'
::r,
"
i./,
. __ "
1,:::,1:".,.
PAsCAULT' iI.OOeltRAN.
867
should ao so; ahd, had she been remiss' in' the performance of that duty, the defendant would have had just cause for exceptiDD. Instead lowinp; the debt and interest to acCUlI1ulate, and the property to rate by mismanagement or waste, thetnortgageof Henry S. Cochran was put ihsuit, and to preserve the property the court took possession of it through a receiver, the rents:a.nd profits, Rnd accounted for tnem after a final decree had been obtained. Such a. receiver is uniforml:Y"regarded as the officer of the court', exercising his functions in the interest of neither plaintiff nor defendant, but for the common benefit of all parties in interest.' Being an officer of the colirt, the fund or prop-intrusted to hiscare!is regarded as being in custodia legis, for the benefi.t of whoever may eventually establish title thereto; the court itself having care of the property by its receiver, who is merely its creature powers other than those conferred upon him by the omaro! his appointment, or such as are derived from the established of courts of equity. . The purpose for which a receiver takes pos,. sesmori is closely allied to' that of a sheriff in levying under execution. excepOhat the scope of the receiver's authority is more comprehensive, siticehe is tisually required to pay all demands· upon the fund in hil hands to the extent of that 'fund; and it has been held that the appointinent.of a. reeeiveris, in' an .equitable' execution. It does not to, or ci'eateany lien upon, the property, and ordinarily gives' nO)l.dvantage or pridrltyto the person at Whose instance the appohtt1Jlentis made over other parties in interest.· High, Rec. §§ 1,2,5. had notice Of the: in the Maryland suit, and cO,uld' ful.ve liad full of all that'transpired dUring their progress. He cOUld hi!. intervened had he chosen- to do SOl' but neither his omisl:iiou' to, i,nterfere; qr the wnritof his consent to tht) makes .. Ins enough to say thattheappointment and aetionof the receiver in no way affected his right as f1urety. . A final objection is that the defendant's mortgage, purporting to be a, deed of bargain and sale;which isthe'oommoni tt1odeof ,assurance in Delaware, and operates under the statute of uses, does not contain the name of a bargainee. The grantor "bargains and sells unto the sole and separate use of the said Catharine C. Pascault," and not to C. C. P., and to the only use and beh00f q( the said. O. C. P., aqd therefore it is alleged no use is effectually raised to draw the legal estate out of the bargainor. The mortgage iscl'timsilyidl'll.wn,butthe-intention of the parties to it is manifestly clear, and it is the provingeof a court of equity to reform a unless controlled by the use -deed,-8(),tb.aHtwiU conform. to the of:technicalwords whichcannot be set aside. Here the land was conveyed separate use of the cqIllplainant, which by force of the to the sole statute attaches the.possession, and tPe. eeatuique use becomes the complete owner, both at law and in equity.' Even if the construction· of the d,efendant's counsel was ,the true One, it. yvould ·.bea gross perversion of justice to overthrow a.deed on account of an obvlously clerical omission .wmclrtpist?prt would tpe In the course of theu argum('nt counsel dlscussed several qUllstl,ons
any
i
.
.'
·
868
FEDERAl. RE?OltTEB.
which' .not been adverted to in the foregoing opinion, under the bellefthat sufficient reasons have ,already been assigned fodhe judgment of the court. The doctrine that 11 surety is a favored debtor was brought prominently into view, as well as t,he hardship of the defendant's,position in beingoompelled to for a 4ebt from which he had not and could 'not have derived any: ,benefit. is a mistake, however, to suppose that by "favor" is D;leant, "partiality," or any exclusion of a due oonsideration of the meaning is, as stated by Justice,STORY, that the S\lretylsundertaking is to receive a strict interpretation;;and must notbeC1t;tellded beyond the fair scope of its terms. When. a surety has and voluntarily contracted to answerfor the· default of another i without having been deceived or misled by the representations of the creditor, and there has been no departure from the terms, of the oontract, ,he cannot be released from his oblig:Hion. He musUirstsatisfy court that, on some legal or equitable ground, he is entitled to be dischlU;ged. The creditor also has the right, when he has parted with or property on the faith of the surety's guaranty, to be saved from l.oS!!, /lnd proteqtion from the court. The peculiar hardship in present case grows ou,t of the oUB depreciation in the; value of realestllte.in Cecil cOHnty since the sale B.ut the ,purchaser ,and his surety ,were not ignorant or inexperienced persouB,whe'IlJhey made the bargain. They stood on equal terms with ' No" charge,of 01.' cl:u;ldealment of an)' Il}lilterial facto);!, the part of the "eudors, by wh,iGh the ptirohaser iQtoanunfprttmate speculation, has b(:Jen proved; . Thequestillln.io:,Buch ,cases IIlways is, was the contract areasonableandfair one at, the'time it was made? . If such ,was the fact, the parties ltl:e:oonsideredll,$; taken upon the risk of quent:fluotuations the property .lffllard ,V;. Tayloe, 8 Wall. 571. The adoptionofa differeut rule open the door to endless oonfusion lind Let ,a decree. be.'entered: fortbe complainant·.
GES'r ii
v: PAcKwooD et al. D.Orego.n.:March 19,1888.)
," ' 'On$'\vh6 takes' a mere conveyance Of (mother's interest In real property, or is not purchaser for a valuable"c()Jl.sideration Within tb\l r\\le in equity, which protects such a purchaser against a prior cODTeyance orrighiof which he liall nq notice; for 'by the very terms of his convE'yanc& lie hashbtice that he Is, 'purchasing nothing more th;an the interest or right his vendor, then has in 1ll.lld.1 , , lAs to title to 'land through a 4Ul.tclafm deed is a bonaftd6 pui-chaser W'itheut notice' ol'tL6t, soo JohnlDav.' Williams, (Kan.) 14 Pac. Rep. 587, and note; African M. E. Church V'. Hewitt, Id.540;,Hastings v. Nissen, 81 Fed. Rep. 5117; V'. Albright, (Mo.) 5 S. W. l'tep. 801; Tram Lumber Co. v. Haaoock, (Tex.) 1 f).W;:EWp, 724. .. ,