Court Opinion

ID: 5552169
Source: CourtListenerOpinion
Date Created: 2022-01-11 00:34:08.646817+00
Date Added: 2024-06-11T08:35:11.029074
License: Public Domain

By the Court.

Starnes, J.
delivering the opinion.
[1.] We see no reason to interfere with the judgment of the Court below, on any point, except that made upon so much of the charge to the Jury as instructed them, that “ if, when William Byars stood security for James it was agreed between *476them, that James should secure his brother against loss, by a mortgage on a negro and failed; and if the security agreed •on was not given, and afterwards William was secured by a •deed to one of the lots, and by a deposit of the certificates for ■the balance — if William was without notice of Mounce’s lien, he is protected against it”; and to so much of the charge in conmection with this as instructed the, Jury, that if James Byars had thus agreed with his brother William, to give him a rhort:gage on a negro, for the purpose specified, and failed to do so; and afterwards, “ to indemnify or secure William Byars in standing his security, executed to him a deed to one of the lots-, and •delivered to' him such evidence of title as he had received from Mounce, viz: the certificates of purchase; now if William Byars, ¿at the time he took the deed and received the certificates, had ¡no notice that the purchase-money, or a part of it owing to Mounce was unpaid, then William Byars is an equitable mortgagee, and stands in the position of a purchaser for a valuable consideration without notice; and if he acted in good faith he is to be treated as a purchaser, in good faith, for a valuable consideration without notice, and is protected against complainant’s lien”.
In another portion of his charge, the Judge admitted, that “ though an equitable mortgage, created by a deposit of title deeds -to secure the payment of an antecedent debt is not such a lien on the land, as to overcome the vendor’s lien for-the purchase money; ” yet, he proceeded to say again, that if there had been an agreement, at the time William Byars became security for his brother, that the latter would, for his protection, give him a mortgage on a negro, and James failed to do so ; but afterwards, in lieu thereof, turned over to him these title deeds, as security against payment of the note, that in such case, “ William Byars stands on the same footing as he would have done, if the indemnity had been given at the time of his becoming security”,.
Erom all of which instruction, it, seems that .the Court below considered the previous agreement between James and William .Byars, in relation to the mortgage on a negro, as taking the *477¡case out of the rule, which he had been ashed to recognize, and placing the defendant, William Byars, in the situation of -a bona fide purchaser for a valuable consideration.
[1.] The consideration for this equitable mortgage, it is said, will be found in the fact, that William, Byars- had become security for his brother, on a promissory noté ; that this deposit ■of title deeds was intended to protect him against the liability ¡thus assumed, and that- thereafter,' he occupied, towards that brother, the relation of a purchaser'without-notice.
It seems that William Byars had become security for James, on this note, before the sale of the land in question to James, by the complainant; and no reference could have been had to it, as part of James’ property, giving him responsibility and credit, when William became his security. This is not, therefore, a question between a creditor and the vendor’s lien; and the rule that the vendor’s secret lien shall not be set up to the exclusion of a bona fide, creditor, so ably vindicated by Ch. J. Marshall, in Bailey vs. Greenleaf, (7 Wheat. 46,) and recognized by this Court, in Webb vs Robinson, (14 Ga. R. 216,) is not here applicable. The rule does not even apply to a judgment creditor, who becomes so before the conveyance to the debtor; for each party, in that case, would have an equitable lien, and the maxim, Qui prior est in tempore, potior est in jure, would prevail, (Finch vs.Winchelsea, 1 P. Win. 278. Mackreth vs. Symmons, 15, Ves. 354. Bailey vs. Greenleaf, 77 Wheat 56.)
[2.] His Honor, Judge Starke, however, was of the opinion, that as James Byars had agreed to give his brother a mortgage upon a negro slave, to protect him, as security on the note, and' failed to do so, but afterwards made this deposit in lieu thereof, William Byars was .thereby placed in the position of a purchaser for a valuable consideration, without notice.
We cannot see, ourselves, what connection there was, under ¡the circumstances, between the agreement to give a mortgage •on a slave, supposing it to have been made, and the deposit of -these title deeds as collateral security. It appears that the •latter, by a totally independent and distinct understanding, *478without other advance or consideration, was substituted for the former, after the contract between the parties, that is to say, after William had become security for James; and that this collateral security consisted of property which was not owned by James, at the time his brother became security, and he agreed to give the first mortgage. If there had been anything like an understanding between the brothers, at that time, that James had the purchase of this land in prospect, that it was his intention to pay for it; and if he failed to give the mortgage on the. slave, this deposit of title deeds should be made in its stead, then there would have been a connection between' the two things; and it might, perhaps, have been said, that William was influenced in becoming his brother’s security, by the consideration that the latter was to own this property; and he (William) should, therefore, be regarded in the light of a creditor with a lien upon this land. But there is no such evidence— nothing, in fact, to connect the deposit of these , title deeds with the agreement between William and James Byars, at the time he became security, as to the protection of the former, because of his becoming security for the latter. And William Byars, therefore, appears here as a volunteer.
We are not sure, however, if it had been otherwise, even if William had-become security for. James, after the purchase of the land by the latter, that his lien would have been superior to the vendor’s lien pn the land; for it was only a contingent liability which he had assumed, and not an indebtedness. He might never have had to pay the note. Can he properly be said, then, to have occupied the relation of a creditor to' his brother, on this account ? At most, it would seem to have been «only an equitable interest which he had in property of his brother, after becoming his security; and here, again, would apply the maxim, that of two equal equities, that is superior which is prior in point of time.
• The view of the Court below, which we have been considering, proceeds upon the assumption, that James Byars had agreed to give a mortgage upon a slave to William, in consideration of the latter becoming his security. But we can find no *479such statement in the record, as it comes to us, except in the answer of William Byars; and the Court expressly charged the Jury, that the answer, on this point, was not responsive to the bill; and therefore, not evidence. If this be so, though the Court had been right as to the legal principle which he stated, he applied it to a hypothetical state of facts, not in evidence,, and he was therefore in error.
On the whole, we think the Court erred in holding, that im this transaction, William Byars occupied the position of a purchaser without notice, for a valuable consideration, and that he stands on the same footing that he would have done, if this equitable mortgage had been given, at the time of his becoming security.