Case Name: Woods, et al. vs. Fulton and Starck
Court: Court of Appeals of Maryland
Jurisdiction: Maryland
Decision Date: 1818-06
Citations: 4 H. & J. 329
Docket Number: 
Parties: Woods, et al. vs. Fulton and Starck.
Judges: 
Reporter: Reports of cases argued and determined in the General Court and Court of Appeals of the State of Maryland, form 1800 ... [to 1826]
Volume: 4
Pages: 329–331

Head Matter:
Woods, et al. vs. Fulton and Starck.
lease-f"tu s'enrclóma» tali7ld0prom;3,o!T ai»i which d) c'ompdied «mied, from ne-aify SudSk-nuiS ti» admí-imsemátivés ’oí-írbe’fSr£ansa*e‘«í mortgaged S™,mon”t'apáií ,,fat t0n tfcqumtwnT’whw ^fraSíSt t"ehc"d"ansce “ d, did not’»™”, ¡".fstateÍhr’imli'í ills''° 'creditor^ Xte™!™ {¡ÍSÍ —And jimas«o ti,m of the ele-theaet oífm“, ca!” aud^tww’&r could can to ‘ins aid the provision* of that act in a case whore the complainant doc-? not seek to record his mortgage, hut claim# relief under that branch of equitable jurisdiction, which enforces contracts made iona Jidet and for a valuable «oimuerauoiji
Appeal from the Court of Chancery. The bill in case was filed by the complainants, (now appellees,) against the administrator and representatives of J. M. Dennison, to obtain a decree for the sale of a house and lot in the c ¡ • ty of Baltimore, alleged to have been mortgaged to them by J. M. Dennison, in his life,-time, to satisfy a.debt due from Dennison and his partner, Thomas L. Savin The substance ot the case, as disclosed by the record, is this— Denrdson & Savin were partners in trade in Baltimore; as were also the complainants. They agreed mutually to endorse for each other, to obtain discoums from the and at the same time agreed mutually to secure each other, an d for this purpose Dennison made a mortgage of the premises in question to the complainants; and Fulton, of the complainants, made a mortgage of a house and lot he held in Baltimore to Dennison & Savin. These transactions took place about the 31st ol July 1811. Each party reciprocally endorsed for the other to a considerable extent; and finally, upon the death of Dennison, which pened in August 1813, the complainants took up the paper they had endorsed and loaned to Dennison §• Savin, to the amount of §4462 73. William Woods & Westly Woods, vvere also partners in trade, under the firm of Woods & Son, and had also loaned and endorsed for Den-mson fy Savin to a sum exceeding S300Ü, to secure which Denmsnn had agreed to mortgage the aforesaid house and jnt, and had giver, directions to prepare a mortgage to that «fleet a short time before his death, but he was taken ill and died before he could execute if. Neither the gage from Dennison to the complainants nor from Fulton io Dennison & Savin, were recorded. It was alleged by the complainants that this was the result of forgetfulness and inattention, and proceeded from no fraudulent intention. It was also alleged by the defendants, that it was mutually agreed, at the time of executing the mortgages, that they should not record them. Dennison died intestate, leaving a daughter, Sarah, the wife of T- L. Savmt and a son named Marcus. Woods was the administrator of Dennison, and contended that the complainants were only entitled to come in pari passu with the other creditors. The mortgage premises were leasehold.
Kimcy, Chancellor, {July term 1816,) decreed, that the premises mentioned in the mortgage from Dennison to the complainants should be sold to satisfy the debt due to them. From that decree the defendants appealed to this court.
The cause was argued before 'Buchanan, Johnson, Mab.-.tin, and Dohsey, J.
Winder, for the Appellants.
The mortgage was not recorded, and the bill prayed for a sale of the mortgaged premises. The chancellor, without directing the mortgage to be lecorded, decreed a sale of the property to pay the debt, to secure the payment of which it was executed. The only ground on which the complainants could come into a court of chancery was under the actof 1785, ch. 72, s. 11, to have the mortgage deed recorded. A fraud was committed on the creditors of Dennison, and of Dennison & Savin, by withholding the mortgage from record.
Martin, (Attorney General,) and Pinkney, for the Ap-pellees.
The only question is, whether, though the deed was not recorded, the complainants have not such an equitable lien on the property against the heirs.of Dennison as to.be entitled to have it applied to the payment of their debt? By' the general law of the court of chancery, previously to the year 1785, this mortgage would be considered a contract in equity which the court could decree upon on . equitable grounds, as a particular lien. The court would have viewed it as a mortgage of a particular debtor, and liable to every equity to which the mortgagor would be liable.Here the mortgage not being recorded, was not owing to any fraudulent intention. It was not incumbent on the complainants to prove that there was no fraud, because none was alleged in the answers. Is the mortgage not oil a meritorious consideration, and the peculiar favourite of the court of chancery? But it is said the complainants have lost the effect of their mortgage in a court of equity, because it was not recorded. The mortgage not being recorded is not valid in point of law. How is the defect to be supplied, but by the court of chancery, which will give efficacy to it, and can do so by considering it as a contact. Every mortgage is a contract, even without cove- Bants, but here there are covenants. It isa mere agreement,and as .such a court of equity can carry it into effect. The act of 1785 does not interfere with the general powers of the court of chancery, or to any exclusive equity which it possessed before. It only restricts the particular case legislated upon by the act. To show what was the powers of the court of chancery in a case similar to the present, and the nature of special liens, they referred to Pow. on Morlg. 460, 469. Burn vs. Burn, 3 Fes. 573. Notice to general creditors was not necessary. Pow. on Mortg. 585, 586. There is no allegation in the bill or answers that Dennison fy Savin were insolvent, or that Dennison was insolvent. The creditors are not, therefore, made parties, and cannot be affected by this decree. The bill and prayer in it are that the particular piece of property mortgaged should be made liable to pay the particular debt.
Winder, in reply, referred to 1 Madd. Chan. 329. Lloyd vs. Collett,4 Bro. Ch. Rep. 469j and S. C. 1 Atk. 12, (note.)

Opinion:
Dorsey, J.
delivered the opinion of the court. It has been contended on the part of the appellants, that the decree of the chancellor ought to be reversed, as the mortgage from Dennison to the appellees was fraudulent, with reference to the creditors of Dennison, and Dennison & Savin; and the eleventh section of the act of 1785, ch. 72, has been relied on to establish this position. As the answers do not state the insufficiency of the estate of Dennt-son to satisfy his creditors, or the insolvency of the firm of Dennison 8f Savin, (and to those points there is no proof in the cause,) the question of fraud, with reference to creditors, does not arise in the cause. This view of the case renders it unnecessary for the court to decide on the true construction of the statute referred to, or to give any opinion on the question, how far the defendant could call to his aid the provisions of the said statute, in a case where the complainant does not seek to record his mortgage, but claims relief under that branch of equitable jurisdiction, which enforces contracts made bona fide, and for a valuable consideration.
DECREE AFFIRMED.