Case Name: THE COMMERCIAL BANK OF NEW JERSEY v. JOSEPH W. RECKLESS ET AL.
Court: New Jersey Court of Chancery
Jurisdiction: New Jersey
Decision Date: 1845-06
Citations: 5 N.J. Eq. 430
Docket Number: 
Parties: THE COMMERCIAL BANK OF NEW JERSEY v. JOSEPH W. RECKLESS ET AL.
Judges: 
Reporter: New Jersey Equity Reports
Volume: 5
Pages: 430–453

Head Matter:
THE COMMERCIAL BANK OF NEW JERSEY v. JOSEPH W. RECKLESS ET AL.
1. Allegation of the delivery of a bond and mortgage not sustained by the evidence offered.
2. The possession of a mortgage, obtained from the clerk’s office by the person named therein as mortgagee, without the consent of the mortgagor, and after he had refused to deliver the bond to secure which the mortgage was drawn, is no evidence of the delivery of the mortgage.
3 To constitute the delivery of a deed, the grantor must part, not only with the possession, but with the control of it, and deprive himself of the right to recall it.
4. To make the leaving of a deed, by the grantor, with the clerk, for registry, and the registration thereof, a good delivery to the grantee, it must be left for the grantee, or with such directions from the grantor as to amount to a delivery and authorize the grantee to take it from the clerk.
5. The denial in the answer, of the material allegation of the bill, which denial is supported by a witness for the defendant, cannot be overcome by a single witness in support of the allegation of the bill, though there be discrepancies in other matters between the answer and the witness for the defendant.
The statement of the bill in this case is, that Joseph W. Reckless, being indebted to “The Commercial Bank of New Jersey ” on four promissory notes, drawn by said Reckless, and endorsed, respectively, by another person, and discounted by the said bank, being renewals of previous notes of long standing, for the better securing the same, and as collateral security therefor, on the 5th March, 1841, executed his bond to the said bank, conditioned for the payment of $3600, the amount of said four notes, and, to secure the payment of the sum mentioned in the condition of the said bond, executed, with his wife, the mortgage set forth in the bill; that the mortgage was acknowledged by J. ~W. Reckless and wife, on the day of ib, date, and was registered on the 24th March, 1841. That after the execution of the bond and mortgage, they were delivered to the complainants. That J. "W. Reckless, or some person for him and in his name and by his authority, under the plea or pretence of procuring the assignment of a certain policy of insurance on the premises, to the complainants, and the assent of the insurance company to the assignment, shortly after the delivery to the complainants of the bond and mortgage, procured them from the complainants, with the full understanding and belief of the complainants that they were to be returned to the complainants when the object for which they were taken was accomplished. That the mortgage was returned to the complainants, but that Reckless, at all times thereafter, refused to deliver up the bond to the complainants, and that the bond remains in the possession or under the control of Reckless.
The complainants charge that the bond was actually delivered to them with the mortgage, and insist that their rights are not affected by the detention of the bond; and further insist that “ as the mortgage was given as security for the payment of the notes, to the amount specified in the mortgage and bond, their right in such security is good and perfect, independently of the bond, which was not the evidence of the debt, but merely designated the amount for which security was given.”
J. W. Reckless, in his answer, admits his indebtedness on the notes, and says that on the 5th March, 1841, and for several weeks previous, he was sick and confined to his house and bedroom, and that during his illness he was applied to from time to time, and importuned by the bank to secure the notes by a bond and mortgage on property at Amboy j which he repeatedly refused to do, because he had no property except what he acquired by his marriage, and which, by an agreement with his wife before marriage, he was bound to convey in trust for her; that being debilitated in mind and body by his sickness, he was so far overcome by the importunities of the bank that he had a bond drawn up, of the description mentioned in the bill, and also the mortgage mentioned in the bill, and which is now in the complainants’ possession; and that on the said 5th March, 1841, Judge Potter came to his room where he was confined, and he executed the bond in the presence of the said judge, and he and his wife executed the mortgage and acknowledged it before the said judge; but that neither the bond nor the mortgage was ever delivered by him, or by his authority, to the complainants or to any person for them ; and that the bond has never been out of his possession; that immediately after the bond and mortgage were signed, he deter mined in his own mind never to deliver them, for the reason that the property embraced in the mortgage was the property of his wife, and was agreed to be secured to her, as before stated; and that he never did deliver them; that a few days after the mortgage was signed, his son Anthony, at the request of the said defendant, took the mortgage out of his possession, and went with it to the clerk’s office for the purpose of procuring a certificate of search j and, as he is informed by Anthony and verily believes, Anthony took the mortgage to the clerk’s office and left it there, with the direction to have a search made as to encumbrances on the property $ and that without his knowledge or authority, and, as he is informed and believes, without the knowledge, direction or consent of Anthony, the complainants procured the mortgage from the clerk’s office j and that they obtained possession of it without his consent or knowledge, and contrary to his wishes and intentions; that neither he, nor any person by his authority, ever called at the bank and procured the mortgage or bond, for the purpose mentioned in the bill; that Anthony went to New York, after the bond and mortgage were signed, and without having the mortgage, to obtain a renewal of an old policy of insurance on the premises, taking the old policy with him, and did obtain the renewal j and that be is informed by Anthony, and verily believes, that Anthony never obtained the mortgage from the bank for that or any other pnrpose.
Mary Ann Reckless, the wife of Joseph W. Reckless, answering for herself, says that she signed the mortgage with her husband, at the time and place and in the manner stated by him ; that she never knew of any delivery of the bond and mortgage to the complainants, or any person, for them; and that she knows no matter or thing variant from the facts stated by J. W. Reckless in the answer, or in any way inconsistent therewith; and that she knows no additional fact concerning the execution or delivery of the bond and mortgage.
Joseph W. Reckless, further answering, says that since the date of the bond and mortgage, the complainants have sued and obtained judgments on the said several notes, and issued executions, and caused the property described in the mortgage, with other property, to be levied on and advertised for sale ; and that his wife and her trustee exhibited their bill in this court, claiming the property by virtue of the trust deed referred to in the bill, and obtained an injunction restraining the complainants from selling the property under the said execution.
The defendants admit that, on June 11th, 1842, they conveyed the premises to Nathan Satterthwaite, and say that, before their intermarriage, the said Mary Ann was seized in fee of the premises, and it was agreed between them, previous to their marriage, and that it was the agreement on which the marriage contract was entered into, that all the property of the said Mary Ann, real and personal, should be conveyed to a trustee, upon such trusts as would secure the same for her use, and beyond the control, and free from the debts and liabilities of her said husband ; and that the conveyance to the said Nathan was made in pursuance of the said ante-nuptial agreement, upon certain uses and trusts, and subject to certain powers and limitations mentioned in the deed, (referring to the deed.)
A replication was filed, July 22d, 1844. A decree pro eonfesso was taken against the other defendants in October, 1843.
Anthony Reckless sworn for the defendants.
— [A bond being produced by J. W. Reckless, and shown to the witness, marked Exhibit 1 on the part of the defendants, he saysj — It is signed in the handwriting of his father, J. W. Reckless, and is the bond referred to in the mortgage; that he was present when the bond and mortgage were signed by his father; they were signed at his father’s house in Amboy, he thinks, about ten days or two weeks after they bear date; his father was then confined to his house by sickness, and had been, for two or three weeks; he was not confined to his room at the time he signed the bond and mortgage; during his sickness he had been confined to his room, but not to his bed ; after they were signed he took them into his possession; they were delivered to him by his father; he placed them with his private papers in a small trunk; and, in the course of two or three days, he took the mortgage to New Brunswick, for the purpose of showing it to the clerk, as a description of the property on which he wished to get a certificate that it was unencumbered; previous to faking it to New Brunswick, he did not show it to any one j when he took the mortgage to New Brunswick he left the bond in the trunk; he gave the mortgage to Mr. Booraem, the clerk, in New Brunswick; he gave no instructions to have it recorded ; he was never authorized or directed by his father to have it recorded; he does not know why the clerk recorded it; when he saw the clerk the next day, he asked him for the certificate and mortgage; the clerk gave him the certificate, and said he had left the mortgage in his office to be recorded, which he said was probably done; he told the clerk he'was very sorry he had had it recorded, as he, the witness, did not intend to have had it done; the clerk said he supposed witness wanted it recorded, and therefore he had it done; this conversation took place in the street, in New Brunswick, near Stelle’s hotel; he took the certificate home, and thinks he sent it to the president of the bank, through Mr. Arnold, but is not certain of it; after this conversation with the clerk, he did not inform his father what had been done — not immediately ; he informed him of it in the course of three or four weeks ; his father found the mortgage was gone, and made inquiry about it, and witness informed him; his father disapproved of the mortgage being recorded; he never got the mortgage from the clerk; his father told him he had better try and get the mortgage; after the bond was signed, witness never took it out of his father’s house; at that time he knew it was not necessary to have a bond recorded ; previous to the signing of the bond and mortgage, witness had a conversation with some of the officers of the bank in reference to having a bond and mortgage executed ; these officers were the cashier and Mr. Bruen, one of the directors; witness had made arrangements with them to give the bank a bond and mortgage, and take up certain notes which the bank held against his father; the amount of the notes corresponded with the amount of the mortgage; the notes were to be given up when the bond and mortgage were delivered to the bank; there was no agreement as to the bond and mortgage being left there as collateral security; witness never delivered the bond to the bank or any of its officers; his father never authorized him so to do, unless the bank would give up the notes at the time it was delivered; the bond and mortgage are in witness’ handwriting. [Witness here desires to correct a previous part of his deposition, and now says the bond and mortgage were signed at or about the time they bear date; his father was sick a great deal about that time, and witness attended to his business generally.
On cross-examination, he says that his father, when he signed the bond and mortgage, was well aware of what he was doing; he knew the contents of them; witness took the mortgage to the clerk’s office for the purpose of having a search made, and for that purpose only; he asked for a certificate that there was no encumbrance on the property described in the mortgage; he did not speak of it as his father’s or mother’s; the search was not made at his father’s request, but at the request of the president of the bank; the president requested witness to have the search made; Mr. H. Bruen was president; witness said nothing to his father about having the search made ; he does not think he told his father he had had a search made, till the conversation took place about the mortgage being recorded; he is not certain that in the conversation with the clerk, the clerk said the mortgage was probably recorded; he thinks the clerk said so ; when he got the certificate he asked the clerk for the mortgage; the reason why he did not get the mortgage was because it was at the clerk’s office, and he supposed that when he went home the arrangement with the bank might be carried out; the arrangement between his father and the bank, of which he speaks, was completed when he left the mortgage in the clerk’s office; his objection to having the mortgage recorded was, he did not think it was his business to have it done; he intended to give it to the bank and get the notes, and let the bank have it recorded; after the mortgage was recorded it belonged to the bank, and he supposed they would give him the notes, as the mortgage was then in the clerk’s office; he does not know how long the mortgage was in the clerk’s office; he never sent or went for it; he does not know who got it from the office; he delivered the search, through Mr. Arnold, to the bank, because he wished the president of the bank to see it; he thinks neither the president nor any of the officers of the bank ever told him they were satisfied ; the search was procured for the bank; after it was procured, and the mortgage left at the clerk’s office, he had a con versation with the cashier relative to the matter; he told the cashier the mortgage was recorded in the clerk’s office, and that he would like to give the bond to the bank and take up the notes; the cashier said he would talk with the president about it; it was some days before witness got an answer from the president, whether he would give up the notes or not; the cashier said the president was unwilling to give up the notes, as the mortgage was intended only as collateral security; witness told him that was not the understanding on his part; he thought the bank intended to give up the notes; he did not think it was right; witness did not ask the cashier for the mortgage at the time; he does not recollect asking any officer of the bank, at that, or any other time, for the mortgage; he did not tell Mr. Nichols, or any other officer of the bank, at that, or any other time, that he would get the mortgage from the office; he does not know why he did not at that time ask for the mortgage; he considered it at that time as belonging to the bank; before the bond and mortgage were signed, he took either them, or the ones from which they were copied, to the bank, for inspection ; he thinks they were left in possession of the bank two or three days; he took a policy of insurance also to the bank, either at that or some other time; he afterwards called for these papers, and the cashier, Mr. Nichols, gave them to him; he took them home to his father’s house; a part of the arrangement between his father and the bank was, that a policy of insurance should be given on the mortgaged premises; such a policy was made out by the North River Insurance Company of New York, for the amount mentioned in the mortgage; it was shown to the bank and taken from them again; he does not think it was ever given to the bank to keep; he thinks, but is not certain, that it was shown to the bank about the time when the bond and mortgage were made; at the time the mortgage was given, the bank was talking about commencing suits against his father; he does not know that they had given his father notice of it; he does not recollect that he was ever present at any conversation between his father and Mr. John Arnold, in reference to the notes ; when he left the mortgage with the clerk he did not notify him not to deliver it to any other person; when he met the clerk in the street and asked him about the certificate and mortgage, the clerk had the certificate with him.
On re-examination on the part of the defendants, he says that, when he stated, in his cross-examination, that the arrangement was completed between his father and the bank, he meant nothing more than that the terms of the agreement were completed; when he says he considered that the mortgage belonged to the bank, he does mean to say he thinks the bank ought to have it, but only that it legally belong* d to the bank.
On further cross-examination, he says that, after he was told by the cashier that the bank would not give up the notes, he did not say to the cashier that he considered the transaction at an end.
.Tames A. Nichols, the cashier of the bank, sworn on the part of the complainant, says that the notes in question were discounted at the bank, for the accommodation of Reckless; they had been running for a considerable time; the notes described in the bill are renewals of former notes; he says that the mortgage was given as collateral security for the payment of the notes; that Mrs. Reckless called on witness, and wished to know if the bank would not take a mortgage for $3600, to secure the amount due on the notes, and until Mr. Reckless should be able to raise the money to take up the notes; witness directed her to Mr. M. Bruen, that he might lay the proposal before tke board of directors; Mrs. Reckless met Mr. Bruen just below the banking-house; and, subsequently, the board decided to take the mortgage; at this time, the proposal was, that the mortgage should be given on the homestead, in Amboy; afterwards, she proposed to give it on the property described in the mortgage; witness knows that a bond was executed by J. W. Reckless, to the complainants; he has seen it: had il in his possession, as cashier of said bank; it was given to witness, as such, by A. Reckless, son of J. W. Reckless; witness has not the bond now in his possession, nor has the bank; the bond and mortgage, and a policy of insurance on the property, were given together to witness, by said A. Reckless, at the bank, and as cashier of the same; the papers above mentioned were all executed at the time of said delivery; witness thinks he saw the mortgage before execution ; thinks the mortgage, or a rough draft of it, were presented to the bank before execution, to see whether it was correct, and the bank were satisfied with them; after this, they were returned to A. Reckless by witness, for the purpose of having them recorded, and that the policy of insurance might be transferred to the bank ; the bond was handed over at the same time, witness being under the impression that it was necessary to record the bond as well as the mortgage; the president directed that Mr. Reckless should be at the trouble and expense of recording the papers, as well as preparing them; neither the witness nor the bank have ever had possession of the bond or policy, since; the bank obtained possession of the mortgage from the clerk’s office; J. W. Reckless, at the time of the preparation and delivery of said papers, was confined to his house by sickness, during which, A. Reckless acted for him in this matter; witness does not know that Mr. Reckless ever absolutely refused to return the bond; witness sent to the clerk’s office for the mortgage; thinks the bank was about foreclosing, at that time; it was a long while before it was sent for; the bank did not pay the fees for recording, to the knowledge of witness; witness, during the time the mortgage lay at the clerk’s office, supposed the bond was there with it, not during the whole time, however, because he was informed it was not — was so informed by A. Reckless — up to which time, he supposed it to be with the mortgage, at the clerk’s office; the permission of the insurance company to transfer the policy to the bank, was obtained by Mr. Reckless, or some one for him; the policy, at the time witness had it, had a blank assignment on it, not filled up, it being necessary to obtain the permission of the company, for this purpose; the date of the said permission was March 15th, 1841, that of the policy being March 8th, 1841; witness obtained his knowledge of the fact of permission being granted, and the date thereof, from inspecting the books of the company,, in .New York; witness did not see the policy in New York; it was a part of the understanding, and a condition on which the mortgage was taken by the bank, that the property should be insured, and the policy assigned to the bank; the bank never paid any premium for insuring the property; Joseph W. Eeckless and his wife, in February, 1841, gave another mortgage on the property then belonging to Mrs. E.; gave it to witness ; a bond was given at the same time; both are now in witness’ possession ; witness had a conversation with Mr. Safterthwaite in regard to the mortgage mentioned in the bill; Mr. Satterthwaite, as trustee for Mr. Eeckless and his wife, asked witness if the bank would wait and let the mortgage lie, provided he would pay up the back interest and pay the future interest as it became due; witness stated to him that there were other amounts due the bank from Mr. Eeckless, and that witness thought it would be necessary to make some arrangement about that before the bank would consent to wait; Mr. Satterthwaite replied that he had nothing to do with any other debts; that he had only to treat about this mortgage; the conversation was in the street; it was commenced by Mr. Satterthwaite; he was then attending to some repairs about the property described in the mortgage; witness thinks it was in the summer before last (1842). [This conversation was objected to.]
On cross-examination, lie says he got his mortgage recorded j he does not recollect whether he took it to the clerk’s office himself, or sent it; rather thinks he sent it a few days after it was delivered to him, and before the papers for the bank were left with him ; witness believes he sent both bond and mortgage to be recorded ; thinks he got them from the office by sending an order for them; he never had taken a bond and mortgage from any person before that, either for himself or for the bank; he mentioned to the president of the bank that he had delivered the papers to A. Eeckless; thinks the president told him to deliver the papers to A. Eeckless for record ; is satisfied he told the president he had delivered the papers to A. Eeckless to be recorded, and the policy to be assigned; the president expressed no surprise that witness had delivered the bond; witness required no receipt from A. Eeckless; he expected the policy to be returned as soon as it should be assigned ; he made inquiry after the papers about three months afterwards, it might have been ; made the first inquiry of A. Eeckless j thinks the question was asked by some one of the directors, whether witness had re-obtained the papers; witness remained perfectly easy, during these three months, in relation to the papers, because he presumed that the bond and mortgage were at the clerk’s office, and the policy at the office in New York; A. Reckless was to return the policy to witness; when A. Reckless took the bond with the mortgage for record, he did not say he wanted the bond for record, but witness thought if was necessary; a search was made previous to executing the mortgage ; he thinks he informed the complainants’ solicitor as to the means by which A. Reckless obtained the bond, in order to enable him to draw the bill; A. Reckless, at the time of the negotiation, lived with his father, in Amboy ; he left soon after, for Monmouth; the first time he saw him after his return from Monmouth, witness conversed with him respecting the papers, witness introduced the subject; he thinks the complainants’ solicitor read the bill of complaint to him, the witness; as witness recollected them at that time, the facts stated therein were correct ; Mr. Reckless, during this transaction, was in embarrassed circumstances; the directors felt uneasy respecting some of these debts; they were desirous to secure them ; he has understood that the property embraced in the mortgage formerly belonged to John Patrick, the first husband of Mrs. Reckless; he first discovered it was unnecessary to record a bond in New Jersey, from Mr. Paterson.
Being re-examined-in-chief, he says time was given to Mr. Reckless, and the mortgage in question taken, in order that Mr. Reckless might be enabled to raise the money, Mrs. R. then stating that to sell the property at that time would be a great sacrifice; the property of Mr. Reckless was considered by the officers of the bank, at the time of executing this bond and mortgage, sufficient to pay all his debts ; the understanding of the bank and Mr. Reckless was that the bank should retain the notes also, and that the bond and mortgage were taken as collateral security; thinks the bank would not have consented to take the bond and mortgage in lieu of the notes ; he never would have re-delivered the papers to A. Reckless unless under the supposition' that they would be returned in good faith ; he had at that time every disposition • to believe that the agreement would be carried out and the papers returned in good faith ; m satisfaction of this mortgage, witness, as cashier, would have delivered up the notes to Mr. Reckless.
Being again cross-examined, he says that, when he says that the property of Mr. Reckless was considered, at the time of executing this bond and mortgage, sufficient to pay all J. W. Reckless’ debts, he means all his property, as well derived from his wife as otherwise.
Matthias Bruen, sworn for complainants, says that, while walking in the street, at Amboy, about the time of the giving the bond and mortgage in question, he was met by Mrs. Reckless, who said she had just been conversing with Mr. Nichols, who had referred her to witness; he asked her what her object was; she replied that they had had notice that the notes held by the bank against Mr. Reckless were to be put in suit; witness said it was so; that they had been running a long time, and that the directors had resolved to bring the business to a close; she appeared to be in great trouble, and said she hoped witness would not press the thing ; he answered that the board had no desire to do anything unreasonable; to which she said she would secure the claim of the bank; witness asked her in what way ; she answered, by giving a mortgage on her own property, or property that once was hers; witness said he understood the property then belonged to her husband; that she had made it over to John Reckless, and he to his father, of same date; witness then said he would lay the ease before the board ; that he was but one of the board ; and they would determine what to do; he did lay the circumstances before the board, at their next meeting, and they agreed to take a bond and mortgage as collateral security for the notes due, and to suspend prosecution on the notes; he had a conversation with A. Reckless; he told witness he would have all the papers executed, and would leave them with the cashier; at the time of this conversation, Mrs. Reckless proposed to give a mortgage on the homestead, which the bank preferred; but Mrs. Reckless afterwards asked the bank to take the mortgage on the premises described in the mortgage; the bank, at first, did not think favorably of the proposal to take any mortgage, thinking the notes had been too long running, and witness himself was opposed to it; but Mrs. Reckless appealed to his feelings and wept, and he consented, and so did the bank, to accommodate her and her husband; at the time the bank acceded to the proposal, it was understood expressly that the notes were to be retained by the bank; and the bond and mortgage were as additional security; such was the understanding, not only of Mr. Reckless and wife, but also of some of the endorsers on the notes; the bond and mortgage would not have been accepted if the condition had been that the notes were to be given up.
On cross-examination, he says he is not a stockholder in the bank; that he parted with his stock on the Wednesday or Thursday before the day of his examination; he says it. is very likely he parted with it in order to be. a witness in the cause, but does not say positively; that he has no interest in that stock at present; hie interest in the stock was somewhere about 1500 shares; that he is not a director; that he resigned his office as such a few days before his examination.
Nicholas Booraem, sworn for the complainants, says he is, and was on the 24th March, 1841, clerk of Middlesex; being shown the mortgage, he says the endorsement of registry on it is in his handwriting; he does not recollect who left the mortgage with him ; but, from the endorsement on it, he knows it came into the office on the 24th March, 1841; he supposes it was brought to the office for record, or he should not have recorded. it; he does not remember that it was brought to the office by A. Reckless; cannot say who brought it; he has no recollection that A. Reckless ever asked him for a certificate of encumbrances on the property mentioned in the mortgage, or any other property of J. W. Reckless ; it is not usual for him to carry in his pocket certificates of search that he has made. Unless requested otherwise, he leaves them in the office to be called for; he does not remember how long the mortgage remained in the office after it was recorded, nor does he know how it was taken out; he is under the impression that he sent the mortgage to the cashier of the Commercial Bank, at his request expressed in a letter; yet he may be mistaken, as the cashier had a mortgage of his own in the office about the same time, given to him by the same parties who executed the mortgage to the bank; he does not know who paid for recording the mortgage to the bank 5 he should not have recorded the mortgage unless he had understood, at the time it was left in the office, that it was to be recorded : he does not remember that he was ever notified not to deliver the mortgage to the bank; if he had received such a notice, he should not have delivered it without an investigation.
A certificate of the secretary of the North Eiver Insurance Company, that on the 15th March, 1841, consent was given by that company for the assignment of the policy to the Commercial Bank, was admitted in evidence.
It was also agreed by and between the solicitors that certain judgments obtained by the complainants against J. W. Reckless, in the Supreme Court, in November, 1842 — one for $4029, and the other for $1014 — be admitted in evidence for the defendants j and that the deposition of Anthony Beckless, though not closed, be admitted and read in evidence.
P. D. Vroom, for the complainants.
J. Van Dyke, for the defendants.
He cited Saxton’s Ch. 458; 10 John. R. 524, 540, 542, 545.

Opinion:
The Chancellor.
The ground taken by the bill is shortly this: that the bond aud mortgage were given as collateral security for the notes j that there was an absolute and final delivery of the bond and mortgage to the bank, in completion of an agreement to give them as collateral security for the notes j that after such delivery, J. W. Beckless, or some person for him and in his name and by his authority, under the plea or pretense of procuring the assignment to the complainants of a policy of insurance on the premises, and the assent of the insurance company to that assignment, procured the bond and mortgage from the complainants, with the full understanding and belief of the complainants that they were to be returned to the complainants when the object for which they were taken was accomplished; that the mortgage was returned to the complainants, but that J, W. Beckless, at all times thereafter, refused to deliver up the bond to the complainants.
From this statement we should conclude that the matter of insurance, and of the assignment of the policy to the complainants, were no part of the arrangement contemplated by the parties; that the bond and mortgage had been delivered to and received by the complainants absolutely and finally ; that the transaction as contemplated was completed; and that J. W. Reckless, or some person for him, by a pretence, cheated the bank out of the possession of the bond and mortgage, and after-wards returned the mortgage to the bank, but refused to deliver up the bond to them. - The cashier of the bank, sworn as a witness for the complainants, says that the complainants' solicitor read the bill of complaint to him, and that, as he recollected them at that time, the facts therein stated were correct.
The testimony of the cashier is the only evidence produced in support of the allegation in the bill of the delivery of the bond and mortgage; and if it stood uncontradicted, it would be very meagre evidence of a delivery of the papers, in the legal sense of the word, and in the sense in which the word is used in the bill, even by the son, and much more insufficient evidence of such a delivery by the authority of the grantors. The statement made by the cashier in his testimony, is essentially variant from the case made by the bill, and the effect of this variance is not avoided by his saying, in his' testimony, that the facts stated in the bill were correct, as he recollected them at the time the complainants' solicitor read the bill to him. Instead of an absolute delivery of the bond and mortgage, and the subsequent obtaining of the possession of them by the mortgagor, or his son, on a pretence, and the return of the mortgage to the complainants, which is the case made by the bill, the cashier, when sworn in the cause, shows that it was a part of the understanding, and a condition on which the mortgage was to be taken by the bank, that the property should be insured and the policy assigned to the bank; that the papers were returned by him, the cashier, to Anthony Reckless, for the purpose of having them recorded and that the policy of insurance might be transferred to the bank; that the president of the bank directed that J. W. Reckless should be at the trouble and expense of recording the papers as well as preparing them; and that the bank afterwards obtained possession of the mortgage from the clerk's office, without asking the consent of the mortgagors, or either of them, or any person acting for them, J. W. Reckless having possession of the bond, and he, or his son acting for him, having long before refused to deliver the bond.
' This is a remarkable failure of testimony to support the case made by the bill. And if we could give to this testimony ail the weight it would be entitled to if the bill (prepared on advisement with this witness as to the facts, as he himself states,) had stated the facts as they are stated by the cashier in his testimony, the testimony is insufficient to show a completion of the arrangement and a delivery of the papers thereupon. If the papers were ever in the cashier's hands after they were executed, they were incomplete, according to the cashier's own account of what the arrangement was; the policy had not been transferred; and all the papers were handed back to A. Reckless for the purpose of having them completed, by the procurement by the mortgagor of a transfer to the bank of the policy of insurance, and, the cashier says, to be recorded ; the president having directed that J. ~W. Reckless should be at the trouble and expense of recording the papers.
It seems to me it would be to indulge in great latitude in aid of the bank, the complainants in the cause, and who are, therefore, to make out their case affirmatively, to say that, notwithstanding the papers were so handed back to A. Reckless for such purpose, and with such directions, the previous possession of the papers by the cashier is now to be considered as a possession on an absolute and final delivery.
Again, whether the arrangement was that the bond and mortgage were to be substituted for the notes, or were to be merely collateral security, it was an arrangement which J. W. Reckless might make or decline to make at his pleasure, and on such terms as he pleased. And if tiie papers were handed back to him, with a requirement that he should have them, or the mortgage, recorded at his own expense, he was at perfect liberty to decline doing so, and to refuse to deliver the papers, Nay, if he had afterwards sent the mortgage to the clerk's office to be recorded, yet, unless he left it with the clerk with such directions as would amount to a delivery to the bank, he could, at any time take back the mortgage from the clerk and refuse to deliver the papers, either with or without reason. The arrangement contemplated was purely voluntary on his part.
The case made by the bill is not sustained. And the fact* stated by the cashier in his testimony, are not sufficient, in my judgment, to show a delivery.
But if a delivery could be affirmed by the court on the testimony of the cashier uncontradicted, it is but the testimony of a single witness, in opposition to the positive denial of the answer. And, so far from finding circumstances equivalent to another witness, in corroboration of the allegation of delivery, the circumstances, and the general features and outline of the case, are strongly in corroboration of the answer. And, beyond this, the testimony of the cashier, if he means to say there was a delivery, in the legal sense of that word in this respect, is contradicted by the very person who, the cashier says, gave the papers to him, and to whom he returned them.
It was said on the argument on the part of the complainants, that there were discrepancies between the answer of the defendant and the testimony of A. Reckless; and the court was asked, for that reason, to disregard the answer altogether, and to give no weight to its denial of delivery. I see no greater discrepancies between the answer and the testimony of A. Reckless than there are between the bill and the testimony of the cashier. Besides, discrepancies in incidental matters between the answer and a witness called to support it, cannot overcome the denial of the answer of the material allegation of the bill. And in this case, the material allegation of the bill denied by the answer that is to say, the delivery, is contradicted by the witness called in support of the answer, the person who is alleged to have made the delivery, and thus the denial of the delivery made in the answer is supported. The zeal of counsel might prompt the idea that both the answer and the witness in support of it should be disregarded in this case; but the court cannot see anything in the case to call for such a sacrifice, much less to make such a sacrifice on the testimony of a single witness for the complainants, giving, in his testimony, an essentially different version of the case from that given in the bill drawn under his advisement as to the facts. I know of no reason for giving to the testimony of a witness standing in the position of this witness, any more potency than is allowed to the testimony Of any other single witness in opposition to an answer. But, in this case, the court is asked to break down, not only the answer, but the testimony of a witness in full support of it, on the single testimony of the cashier of the bank. I do not see that the complainants can reasonably expect this.
Next, the bank allege, in their bill, that the bond and mortgage were to be given as collateral security for the notes, and, as the case stands, it would be necessary for the bank to sustain this position affirmatively, if they could have prevailed on the other point.
Now, the recital of the mortgage is as follows: " Whereas, Joseph W. Reckless, of the first part, is justly indebted to the said party of the second part, in the sum of three thousand six hundred dollars, secured to be paid by a certain bond or obligation, bearing even date with these presents, in the penal sum, &e., conditioned for the payment of the said first-mentioned sum of three thousand six hundred dollars, on or before the 5th day of March, which will be in the year of our Lord 1842, with lawful interest from the date thereof, to be paid half yearly," &e. The bond and mortgage were dated March 5th, 1841. An absolute bond, then, was drawn for three thousand six hundred dollars, and a mortgage to secure the bond. Nothing was said about the notes, or that the bond and mortgage were merely additional security, either in the bond or in the mortgage.
There was no obligation resting on Reckless to give a bond and mortgage, at all. The bank had the notes and endorsements on which they loaned their money; and no object or motive can be perceived to induce Reckless to give a bond and mortgage for the amount due on the notes, except that of relieving his endorsers, by taking up the notes. It is hardly conceivable that Reckless would be willing to give an absolute bond and mortgage for three thousand six hundred dollars, full and complete evidence of indebtedness to that amount, beyond the amount of the notes, and leave the notes with the bank, and subject himself to the hazard of proving or failing to prove that they were for the same debt. No prudent man would do so, in a transaction with an individual; and we are not to presume that Reckless, or any other person, would have more confidence in a corporation than in an individual.
With these remarks in view, we shall not be surprised to find that the effort on the part of the bank to sustain the position they take on this part of the ease, is weak, and the testimony on which they rely, entirely unsatisfactory.
The bill, after stating the notes, says that, for the better securing the same, and as collateral security therefor, J. W. Reckless executed his bond for three thousand six hundred dollars, the amount of said notes, and the mortgage in question, to secure the bond; and the bill says the complainants insist that, "as the mortgage was given as security for the payment of the notes, their right in such security is good and perfect, independently of the bond, which was not the evidence of the debt, but merely designated the amount for which security was given."
The testimony on the part of the complainants may be sufficient to show that the bank intended to get the bond and mortgage, and retain the notes, too, but it is insufficient to show that Mrs. Reckless consented to such an arrangement, and still more insufficient to show that J. W. Reckless consented to it. The two portions of the testimony relied on by the complainants to show that Mrs. Reckless consented to such an arrangement, are as follows % The cashier says that Mrs. Reckless called on him, and wished to know if the bank would not take a mortgage to secure the amount due on the notes, and until Mr. Reckless should be able to raise the money to take up the notes. Does the cashier mean to say that the last clause, " to take up the notes," was the language of Mrs. Reckless ? And if it was, and the whole sentence together, is to be taken, from the language of a woman in distress, to mean that a bond and mortgage were to be given as collateral security for the notes, yet. the bond and mortgage were not so drawn, and there is nothing to show that she consented to the delivery of an absolute bond and mortgage, making no reference to the notes. Matthias Bruen, in his testimony, says that Mrs. Reckless, in her conversation with him, appeared to be in great distress, and said that she would secure the elaim of the bank. These are the only two clauses in the testimony on which the allegation of the complainants, that the bank were to have this absolute bond and mortgage, and retain the notes, too, and that Mrs. Reckless consented to it, rests. Their insufficiency for such a purpose is, it seems to me, apparent.
But what is the testimony relied on to show that J. W. Reckless ever consented to such an arrangement ? It is as follows: The cashier says the understanding of the bank and Mr. Reckless was, that the bank should retain the notes also, and that the bond and mortgage were taken as collateral security. Where did the cashier get his authority for saying that it was the understanding of Mr. Reckless that the bank should retain the notes ? Mr. Reckless was confined to his house by sickness during the whole period of the negotiation, and until it was broken off, and it is not pretended that the cashier saw him within that period. Matthias Bruen, in his testimony, says that at the time the bank acceded to the proposal, it was understood expressly that the notes were to be retained by the bank, and the bond and mortgage were as additional security. By whom was it so understood ? This witness has before said that Mrs. Reckless proposed to him that she would secure the claim of the bank, that he told her he would lay the case before the board; that he did so, at their next meeting, and they agreed to take a bond and mortgage as collateral security for the notes. It is apparent that, thus far, the witness says nothing more than that when Mrs. R.'s proposal to secure the claim, of the bank was laid before the board, the board agreed to take a bond and mortgage as collateral security for the notes. There was nothing in the nature or language of Mrs. R.'s proposal to bind her, even if she had been a single woman, by the agreement of the directors among themselves, to take a bond and mortgage as collateral. That was not the proposal of Mrs. Reckless. The witness then proceeds with this general remark: " Such was the understanding, not only of Mr. Reckless and wife, but also of some of the endorsers on the notes." Now, considering the confinement of Mr. Reckless by sickness, and that it does not appear that this witness ever spoke with Mr. Reckless on the subject, it is asking too much to ask the court to decree on such testimony, (it relating, too, to a time prior to the drawing of the mortgage,) that Reckless consented to deliver, and did deliver, an absolute bond and mortgage, making no reference to the notes, and consented also to leave the notes and the endorsements thereon with the bank.
But again, if such could have been the original understand ing of J. W. Reckless, before the papers were drawn, yet he was under no obligation to carry out such an arrangement. It will not be contended that a bill would be sustainable to compel the performance of such an agreement, and the mortgage, when afterwards drawn, being drawn simply to secure a bond mentioned therein, J. W. Reckless not only had the right to say, but a regard for his own interest required him to say, that the bond and mortgage, as drawn, should not be delivered unless the notes were given up. And J. W. Reckless beiug sick, and his son attending to his business for him, it was the duty of the son to refuse to deliver the said bond and mortgage unless the notes were given up j and he swears he did so refuse, and I can see no reason for doubting it. It was his duty to refuse unless otherwise directed by his father, and of this there is no proof. And yet, in a case in which the complainants must have been well aware that a delivery of the papers could not have been compelled by the court, the court is asked to decree, on the evidence in this cause, that the papers were actually delivered ; and that the mortgage, taken by the Complainants from the clerk's office, long after the refusal of the son, acting for his father, to deliver the bond, (the bond, the principal instrument, being still in the possession of J. W. Reckless,) shall be decreed to be a valid security, independent of the bond. I venture to say that no such decree was ever before asked on such testimony as is presented to the court in this case.
It seems there were other debts due from J. W. Reckless to the bank, besides the amount secured by these notes with endorsers. This may account for the desire of the bank to get the bond and mortgage in the shape in which they were, and retain the notes.
It was said in the argument that the possession of the mortgage was presumptive evidence of its delivery. Whether the possession of a mortgage given to secure a bond, the bond remaining in the possession of the obligor, and he refusing to deliver it, would be any evidence of the delivery of the mortgage, is a question which it is not necessary to consider in this case. The possession of a deed by the grantee named therein, and the possession of a bond and mortgage by the obligee and mortgagee, would be prima fade evidence of due delivery. But I am unable to perceive that the possession of a mortgage obtained from the clerk's office, without the consent of the mortgagor, and after he had refused to deliver the bond to secure which the mortgage was drawn, has any potency whatever, or is entitled to any consideration as evidence of a due delivery of the mortgage. The rule, that possession is presumptive evidence of delivery, has no application to such a state of things. If it be asked why J. W. Reckless left the mortgage so long at the clerk's office, the answer is plain. He had possession of the bond, the principal instrument; and had, as the bill states, and as A. Reckless, w'ho attended to this business for J. W. Reckless, testifies, refused to deliver it. Could it be imagined that, under such circumstances, the bank, or their cashier, would send to the clerk's office and get the mortgage? But I think it may be asked, with much more signifieancy, why the bank pursued the course they did. After the refusal to deliver the bond, a long time, the cashier says in one place, three months he says in another place, elapsed before he sent to the clerk's office for the mortgage. The bank certainly could not have expected that possession of the mortgage so obtained, after the refusal to deliver the bond, would be sufficient evidence of the delivery of the mortgage. And that they did not so expect, the bill itself shows.
The bill says nothing of their getting the mortgage from the clerk's office, but says the mortgage was returned to the complainants ; and the bill is framed entirely on the charge that both bond and mortgage had once been delivered, absolutely, and that they were afterwards obtained from the bank on a pretence, and that Reckless afterwards refused to deliver up the bond. It has been before shown that the case made by the bill is not sustained. And the bank themselves seem to have had little confidence in the ground which, at a very late period, they assumed in the bill. They prosecuted the notes, obtained judgment, and caused execution to be issued and to be levied on these very premises. It was said in argument, on the part of the defendants, and not denied, that it happened that another execution, issued on a judgment obtained by another creditor of J. W. Reckless, was recorded an hour or so before the execution in favor of the bank. The cause was argued for the defendants by counsel in behalf of a judgment creditor other than the bank, which shows that his execution was ahead of that of the bank. It was not till after this state of things occurred, that the bank filed their bill in this cause. It seems to me that the course pursued by the bank betrays an evident want of confidence in the idea that there had been a delivery of the bond and mortgage, or that their obtaining the mortgage from the clerk's office would help their case. And this want of confidence is apparent in the bill, and in the testimony of the cashier and Mr. Bruen.
The fact that the mortgage was recorded cannot, under the circumstances of this case, aid the complainants. To constitute a delivery, even of a deed, a single instrument having no connection with any other, the grantor must part, not o.nly with the possession, but with the control of the deed, and deprive himself of the right to recall it. Dev. Eq. 14; C. W. Dud. Eq. 14.
If a deed be left by the grantor for registry, the mere registration is not equivalent to a delivery. To make the leaving a deed, by a grantor, with the clerk for registry, a good delivery to the grantee, it must be' left by the grantor, or by his authority, for the grantee. Rice's Eq. 244.
If, then, the mortgage was left with the clerk, by J. W. Reckless, or by his authority, for the express purpose of being recorded, which is denied both by the answer and by the testimony of A. Reckless, who handed the mortgage to the clerk, yet there is no evidence that the grantor left it, or authorized it to be left with the clerk for the grantees, and that the grantor intended to part with the control of it.
Delivery is essential to a deed; and as the mortgage was taken from the clerk's office by the bank, or by the cashier for them, it is for the complainants to prove that it was left with the clerk in such manner and with such directions from the grantor as to amount to a delivery to them, or for their benefit, and authorize them to take it from the clerk. 5 Mason's C. C. R. 60. There is no such evidence.
It will not be claimed that J. W. Reckless could not have taken the mortgage from the clerk's office. Were any such di rections given to the clerk, when the mortgage was left with him, as would authorize him to refuse to return it to the person who gave it to him, or to J. W. Reckless ? Certainly not. And the bond, to secure which the mortgage was drawn, was, when the mortgage was handed to the clerk, in the possession of J. W. Reckless or his agent, and delivery of the bond was afterwards refused, and refused before the bank sent to the clerk's office for the mortgage. And in a case like this, the bank could acquire no right whatever to or in the bond and mortgage until an absolute and final delivery of them. J. W. Reckless or his wife might object at the last moment to deliver them either with or without a reason; and if they ever were willing that the bond and mortgage as drawn, should be delivered and the bank retain the notes, they were at liberty to change their mind at any time before the completion of the arrangement by a final delivery of the papers, and to refuse to deliver them. There was no consideration binding them, or obligation resting upon them, either to substitute the bond and mortgage for the notes, or to give them as additional security for the notes. It was a matter resting simply in their will, and they could change that will at the last moment. I do not see that it is possible that the registry of the mortgage, under such circumstances, can afford the least aid to the complainants.
It is not a case of money advanced on securities claimed to have been delivered. The bank have still the securities on which they lent their money. They sustain no loss by not being able to avail themselves of this bond and mortgage; they simply fail to obtain additional or substituted securities for a loan previously made on securities good, or thought by them to be good, when the loan was made.
It is unnecessary for me to make any observations as to the admissibility of the testimony of Mr. M. Bruen, or any animadversions upon it, or on the position in which his cross-examination places him. Taking his testimony as it is, the case, in my judgment, is clearly with the defendants. The bill must be dismissed.
Decree accordingly.
Reversed, 1 Hal. Ch. 650.