Court Opinion

ID: 3231277
Source: CourtListenerOpinion
Date Created: 2016-07-05 16:06:43.436977+00
Date Added: 2024-06-11T07:40:13.827470
License: Public Domain

One phase of the opinion of my brother THOMAS, if I understand it, holds that mere constructive notice of the second mortgage, which recites the fact on its face that it is a second mortgage, was sufficient to put the third mortgagee on notice of the existence of the first mortgage. I am not in agreement with this view. The following authorities are in accord with my view on this point:
"The doctrine of constructive notice, under the recording acts, has always been regarded as a harsh necessity, and the statutes which create it have always been subjected to the most rigid construction." 23 R. C. L. 171, § 24.
"It would be unreasonable to extend the provisions of the registry laws so as to impose upon one who has only constructive notice the duties resting upon one who has actual knowledge. Good faith requires of that man who has actual knowledge of any existing fact to pursue such inquiry as would be suggested to an ordinarily prudent man by that knowledge, and equity charges him with the knowledge which he would have thus obtained had he made that inquiry. But we find no cases which impose this duty upon him who has only constructive notice." Neas v. Whitener-London Realty Co., 119 Ark. 301,178 S.W. 390, 394, L.R.A. 1916A, 525, Ann. Cas. 1917B, 780.
It may be noted that the third mortgagee is not claiming under or through either the first or the second mortgage, and neither of these constitutes a link in his chain of title. They are collateral and antagonistic to his title, and therefore the rule which charges one with the recitals in conveyances in his chain of title is not applicable.
I concur in the conclusion and affirmance, however, on the ground that the third mortgagee had actual knowledge of the existence of the first mortgage arising from the indorsement of that fact on his mortgage. *Page 545