Case ID: scl_2/html/0080-01.html
Source: Caselaw Access Project
Author: {"author": "Bay, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

The Executors of John Ashe, deceased, against The Executors of A. Livingston, deceased.
    
      Charleston 1797.
    
    
      1797.
    
    
      •Ssstmpsit for money had mid received} &e. -will lie fox' money paid by a * sheriff, by mistake to a ivrior judgment credit- or, not knowing of a mortgage by which the* lands sold were bound, and that it was not satisfied.
    A mortgage does not lose its lien by not being put on record ; any judgment af-terwards must be subject to this prior in-cumbrance.
    SPECIAL action on the case, for money had and received to plaintiff’s use.
    It appeared in evidence in this case on the trial, that in the year 1778, Joseph Ashe, the father of John Ashe the plaintiff’s testator, had sold a tract of land at HaddrilPs Pointy in Christ Church parish, opposite the city of Charleston, to one John Berwick, now deceased, for the sum of 31,000/. current money, for which Mr. Berwick gave his bond, and a mortgage of the land to secure the payment of the consideration money. It happened in the hurry and confusion of the war at that day, that this bond and mortgage by some means or other got mislaid, and never were put upon record, (while on the contrary Mr. Berwick had his deed of conveyance for the land, duly proved and recorded,) and they were not found till the year 1790, or 1791, near thirteen years afterwards ; when they were discovered in a trunk among a number of old papers, which had been thrown by as useless trash.*
    ^fSee?^ °^e Aste, soi. Riley’s
    
    In the mean time, however, John Berwick died, and be-i'ng considerably indebted to the estate of Abraham Livingston, Nathaniel Russell, the executor of Livingston, brought a suit against Berwick’s executor, and obtained a judgment against the estate in April,. J787. In January, 1788, Thomas Rivers, another creditor of the estate of Berwick, obtained another judgment against said estate, and under this junior judgment an execution issued; by virtue of which, the sheriff of Charleston district seized the land or plantation at Haddrill’s Point, which had been mortgaged to Joseph Ashe in 1778, and which then appeared to be without any incumbrances whatever, except Mr. Russell’s prior judgment as the executor of Livingston. Under this-execution the land in question was, in April, 17, 8, sold at sheriff’s sale, for the sum of 1,62Si. 2s. 6d. sterling, ljut as Mr. Russell had the prior lien on the land, in consequence of his first judgment, the sheriff paid the money over to him, towards the satisfaction of the debt due to the estate of Livingston; and Mr. Russell, in his turn, paid away this money in discharge of the debts due from the estate of Livingston tq its creditors.
    Upon the discovery of this bond and mortgage from Berwick to Joseph Ashe, in the trunk of old papers in 1791, •the present plaintiffs, who were the executors of John Ashe, who was the executor of Joseph Ashe, the mortgagee, thought it advisable to relinquish their right under the mortgage, of foreclosing it, and proceeding to resell the land; and, therefore, commenced the present action against the executor of Livingston, for the proceeds of the sale which had been paid over to him, as for so much paid by .mistake to their use.
    
      A mortgagee has his choice of two ¡Tine-<]ies5 where the lauds have been sold by a sheriff imcícr ajunior execution and money paid away to the plaintiff.
    He may either proceed in equity and foreclose tlie . mortgage and go against the land, or he anay relinquish Ills lien mid go on at law for the proceeds in the hands of die plaintiff in the suit, to v/bom the money was paid us for so much money received to his use.
    ;5 Burr. too6. ■IJiwr.im.
    
    The Alto. ney-Gcntrul an;: M.\ Holmes, were concerned for the plaintiffs, and Mr. Rutledge and mr. Ward, lor the defendant.
    In support of the action it was briefly contended, that the plaintiffs, on the discovery of the bond and mortgage, had their choice of two remedies j either to proceed in equity and foreclose the mortgage and resell the land, or to relinquish their equity, and sue at common law for the proceeds of the sale, or value of the land in the hands of Livingston’s executor. That thej had preferred this latter mode of proceeding in order to prevent a multiplicity of suits, and avoid a heavy expense on the one hand, and to quiet the purchaser in the peaceable possession of the land on the other : and the rather, because he had made considerable improvements upon it since his purchase. They admitted, that the defendant, Mr. Russell, had an apparent right to receive this money at the time it was paid over to him by the sheriff of Charleston district, but still it was paid over under a mistaken idea, that there was no prior incumbrance on the land ; whereas, it since appeared most unquestionably, that it had been mortgaged to Joseph Ashe, the former proprietor, for the original purchase-money ; not one shilling of which either principal or interest had been paid. It would therefore be manifestly unjust for the defendant to retain this money to the prejudice of the plaintiffs, as they were, upon every principle of justice and good conscience, entitled tq the same ; and in support of their claim they relied on the great and governing principle laid down by Lord Mansfield, in Moses and Macfarlane’s case, and in . mail}7 other cases to the same point.
    Thai this action will lay wherever money has been paid by mistake, or upon a consiaeration -which fails, or for money got through fraud, or imposition, or extortion, or oppression, or in one word, it lies for money which the defendant ought ex ceqno et bono to refund.
    Here they observed, they did not mean to insinuate that this money had ever come unfairly into the hands of Mr. Russelthe executor of Livingston, but as it was obviously paid to him under a mistaken idea that he was justly entitled to it; when in fact and in truth, it was the right of the plaintiffs'' testator : he ought, therefore, in justice, now to refund it and pay it back, as the mortgage has fully evinced the plaintiffs’ right to it; and that defendant ought not e>r aequo et bono to retain it any longer in his hands.
    2 Aik. 83,
    3 P. Wmt>
    
    For the defendant, the counsel admitted the general prir> eiples of law in support of the action for money had and received, as laid down on the behalf of the plaintiffs; contending, at the same time, that there were several strong circumstances in this case, which took it out of those general rules, and made it a very different one from any of the cases relied on. In the first place, it was observed, here tvas very great laches in the mortgagee himself in not recording his mortgage, which had occasioned all the confusion on the present occasion.
    Also on the part of the executor after the death of Joseph Ashe, in not looking for this bond and mortgage, and producing it at the sheriff’s sale of the land ; that it had been said, and said justly, that diligence is the life of die law, and here was a very culpable neglect.
    That the executor of Ashe knew of the sheriff’s sale, and did not forbid it, but stood by and saw it go on.
    And lastly, it was contended, that the defendant had paid away this money out of his hands to the creditors of Living-stores estate, and had it not to refund 5 and that it would be unjust to make him chargeable, after having done his duty in paying off the testator’s debts. They compared this conduct to that of a man standing by and seeing another build on his land, knowing his right, and not forbidding the builder from going on : also to a first mortgagee, per-xnitting a mortgagor to keep his title deeds till a second mortgage was made, without giving notice of his first mortgage.
    Again it was urged, that Mr. Russell was to be considered as an agent in this business, in receiving and paying away this money without notice of this mortgage, in which case he was not liable. They also relied on Lady Wind? sot’s case,' where it is laid down, that this action will not ^01' money paid to an agent, who pays it to his principal without notice.
    They also relied on the case of Jacob Jacobs, a vendue . , , J ,. master m Char íes ton, who had paid away money to his employer, which was claimed by a third person, who after-wards proved that the property sold belonged to him ; yet the court held, as it was paid to the person having the apparent right without notice, he was not liable.
    The Attorney-General, in reply,
    acknowledged the doctrine as laid down between principals and agents, that an action would not lay against an agent, who paid away motley for his principal, without notice ; but insisted that Mr. Russell, in the present case, could not be considered as a mere agent acting for a principal. The money was paid to him as the executor of Livingston, who stood in his testator’s shoes, as one receiving all his testator’s rights, and went to pay off his debts. The action in this case, is not brought against Nathaniel Russell in his own right, so as to make him, or his estate liable in his own private capacity, but it is brought against him, as the representative of Livingston. The judgment in this case would not bind him, or his estate, but the estate of Livingston ; there was, therefore, no similitude or analogy between him, and a mere agent of a third person in esse. On the ground of laches or neglect, which had been so much relied on, that was owing to an accident arising in the hurry and confusion-of war, which raged in this country at that time, and owing to a man’s packing up his papers in the midst of tumult and arms, and afterwards dying, before he had an opportunity of explaining the transaction, or probably before he himself could recollect where he had deposited them, or how he had disposed of them ; but how-' ever the accident happened, or by what means soever it was occasioned, it did not deprive his representatives of a legal right; for the law has fixed no time, nor limited any period, ■within which he was bound to record a mortgage, as laid down in the case of Ashe v. Ashe:
      
       the only risk he ran, ’.vas that of another mortgage being given for the same land, by Berwick ; which, if it had been first recorded, would have had a preference. As to the cases quoted from Atkmis and P. Williams, thev had no bearing on this case, , , ,.; . . , , ’ because they are predicated on a knowledge oj the right. and standing by and seeing a man go on upon mistaken principles, and not giving him due notice. Here the executor did not know of this mortgage at the time of the sheriff’s sale, and therefore was ignorant of the right, of his testator. He had no authority to forbid the sale.
    a mere nsens 2nd pays”a-p'p" c'i’?1 notice, is not liable in ibis action for riey had and received,^iQ. but an executor stands in ihe shoes of his testator, and the <le»;easp<Vs estafo liable to pay back the money received.
    
      
      
        &p. 109. i-JBurr. 1984
    
    
      
      ' Bay's Sep. vol. 1. p. S04. Miley's edit. -
    
   Bay, J.

in charging the jury, told them, that the mortgage had not lost its lien, or binding efficacy, by not being put on record ; it was good, and nothing could impeach it, unless there had been a younger mortgage from Berwick, first recorded.

That a judgment entered up against a mortgagor subsequent to a sale and prior mortgage, gave no sort of lien or priority whatever, as the judgment must be subject to all prior incumbrances.

That there did not appear to be any kind even of presumed assent on the part of the executor of Joseph Ashe, at the sale, as he was then ignorant of any such existing mortgage.

That this money being paid over to a person who was not entitled to it by law, in preference to the mortgagee to whom it of right belonged, was clearly a mistake ; and, therefore, in this action, ought to be recovered back, upon the broad principles of equity and justice, laid down in the cases quoted by the plaintiffs’ counsel.

That if the defendant, Mr. Bussell, had been a mere agent for receiving and paying away money, then under the authority of Lady Windsor’s case, and also on that of fa-sobs's case, the action could not be maintainable : blit as he represented the testator, Livingston, whose estate had re-1 ceived the benefit of it, that estate ought to refund or pat? . , , & e * , back the money»

The jury, after retiring a short time, returned a verdict to the amount of the money received by the defendants, but without interest.

This case was afterwards taken up to the constitutional court of appeals, on a motion for a new trial, on the ground of misdirection in the presiding judge, in his charge to the jury, which was fully argued by counsel on both sides-; after which the judges declared their unanimous assent to the legal principles laid down by the presiding judge on the trial, and therefore refused the motion for a new trial.

Rule dismissed.

Present, BuRke, Grimke and Bat.