Court Opinion

ID: 6999945
Source: CourtListenerOpinion
Date Created: 2022-07-24 03:40:16.826194+00
Date Added: 2024-06-11T16:09:53.702351
License: Public Domain

Mr. Justice Higbee delivered the opinion of the court. This was a bill in chancery, filed by appellant against appellees, to foreclose a mortgage on certain premises in an addition to the city of Aurora. It appears from the evidence that a mortgage was given by one Charles A. Campbell on April 2, 1894, to secure a loan from appellant for the sum of $1,000. Campbell had erected a house upon the premises, buying the lumber from S. D. Seamans, who indorsed the note and received pay for his lumber from the money so borrowed. On March 23, 1895, appellee Carrie I. Hoover, who in the meantime had become the owner of the property, and her husband, S. Eh Hoover, conveyed the same to appellee Harriet E. Spencer. In consideration for such conveyance, said Harriet E. Spencer and her husband, Seldon Spencer, conveyed to Mrs. Hoover certain other premises in the city of Aurora, subject to a mortgage of $1,750. By some mistake or neglect on the part of the officers of the appellant association, the mortgage given to it by said Campbell was not recorded until May 8, 1895, some time after the conveyance of the premises to Mrs. Spencer and the recording of her deed. The appellee Harriet E. Spencer filed an answer to the bill, in which she denied that she had notice of the mortgage of complainant and claimed that she had bought the property in good faith, believing it to be free from incumbrance. She also filed a cross bill setting up the same matter, and asking that the mortgage be declared a cloud upon her title and set aside, and that she be decreed to be the owner of the premises free arid clear from all incumbrances. The question presented to the court was whether or not Mrs. Spencer had actual or constructive notice of the mortgage to appellant, upon the premises conveyed to' her as aforesaid. Upon that issue the court found a decree in favor of Mrs. Spencer and the same question is presented to this court. Appellant insists that Mrs. Spencer, either personally or through her son and agent, Benjamin A. Spencer, had due notice of the existence of such mortgage, or that if she had no actual notice of the same, the circumstances attending the conveyance of the property to her were such as to put a reasonably prudent person upon such inquiry as would, by the exercise of reasonable diligence, lead to the discovery of the existence of the same. In such case, in order to charge the person acquiring the title with notice of such a mortgage, proof of the same should be clear and convincing. It may be proved either by direct evidence or by other facts from which it may be clearly inferred; the inference, however, must be not only probable, but necessary and unquestionable. Robertson v. Wheeler, 162 Ill. 566. The evidence iii the case is somewhat voluminous and very contradictory. There was some evidence to the effect that actual notice of the mortgage was given to Mrs. Spencer, and also to her son, Benjamin A. Spencer, who acted as her agent. She and her son directly deny such notice, and that the same was given to them, or either of them, was not clearly and satisfactorily proved by .the evidence. Bfor do the circumstances of the case tend to establish constructive notice to her of such fact. Five witnesses, who were sworn on behalf of Mrs. Spencer, testified that the value of the property which she conveyed to Mrs. Hoover was from $3,000 to $4,000, while one witness, who was sworn for appellant, placed it as low as $2,400. It is probably safe to say that the property was worth from $1,000 to $1,500 over and above the mortgage. On the other hand, it appears that the premises conveyed to Mrs. Spencer had little if any value over and above the mortgage to appellant. Witnesses valued it at from $1,000 to $1,100, free from incumbrance, and the equity was sold several times for prices ranging from $10 to $75. It thus appears that the equity in the property which Mrs. Spencer conveyed to Mrs. Hoover was worth about the same, or perhaps a little more, than the property received by Mrs. Spencer in exchange would have been worth had the latter been free from incumbrance. . On the other hand, if we assume that Mrs. Spencer took the premises in question, knowing they were subject to the mortgage of appellant, she must in that case have, in effect, given away her property. There is, therefore, no inference to be derived from the evidence that Mrs. Hoover had notice of the mortgage, but on the contrary, the circumstances plainly lead to the conclusion that she had no such notice. The decree of the court below will therefore be affirmed.