Court Opinion

ID: 3727817
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:56:35.86992+00
Date Added: 2024-06-11T18:01:42.322688
License: Public Domain

I dissent from the opinion of the majority of the court in its findings and conclusions that the mortgage liens of the defendant Tiffin Savings Bank are subordinate to the appellant's rights under her lease on the buildings on the 80-acre tract.
I differ with the majority of the court on the sole issue of whether appellant's possession of the buildings was of such a character and to such an extent as to place the Tiffin Savings Bank upon inquiry as to her interest, if any, as affecting the title to the real estate.
The Tiffin Savings Bank by virtue of Section 5301.25, Revised Code, is a bona fide purchaser and its mortgage liens are superior to the appellant's rights under her lease, unless the appellant's possession of the buildings constitutes constructive notice to the bank of her interest in the real estate covered by the mortgage.
It will be conceded that if the nature, character and extent of the appellant's possession was such as to put the bank upon inquiry as to her interest or equities in the real estate, then its mortgage liens would be subordinate to appellant's rights under her lease.
The evidence appearing in the record does not in my opinion support the claim that appellant's possession was such *Page 557 
as to constitute constructive notice to the Tiffin Bank of her interest or equity in the real estate or that it was of such a character as to place the bank upon inquiry before accepting the real estate as security for its loan.
The appellant, Verna L. Chaney, is the widowed mother of Earl Chaney, the mortgagor in the bank's mortgages. The appellant and her deceased husband, parents of Earl Chaney, were the grantors in the deed conveying the 80 acres in question to their son, Earl Chaney. Their deed is one of general warranty and contained no reservations, or exceptions affecting the title.
The lease provides that Earl Chaney does "grant, bargain, sell and lease unto the said Verna L. Chaney, for her exclusive use and benefit during the term of her natural life the buildings on the * * * 80 acres * * *."
The evidence is silent as to the nature, number, or character of the buildings covered by the lease except for the home and the barn, nor does anything appear in the record whether the appellants ever used any buildings on the farm other than the home. As far as the record reveals the buildings may have been used by Earl Chaney in his exclusive cultivation of the 80 acres.
The only evidence as far as the record discloses to support the claim of constructive notice is the fact that the appellant, the mother of Earl Chaney, one of the grantors from whom Earl Chaney received his title, continued to live in the home after conveyance of the farm to her son.
It must be borne in mind that this is not a case where the one in possession has exclusive possession of the entire property sold or mortgaged but a case where such person was limited to possession and use of the buildings on the real estate which was exclusively cultivated by the owner of the record title.
Counsel for the appellant has not cited, nor have the members of this court been able to find, any Ohio case where the one in possession claiming rights by reason of constructive notice was a member of the same family holding record title. In all the Ohio cases cited the party claiming rights by virtue of possession of the real estate was a stranger to those holding the record title. *Page 558 
In Munn v. Achey, 110 Ala. 628, 18 So. 299, we find the following:
"* * * In discussing and allowing possession as constructive notice, the courts lay quite as much stress upon the fact thatthe vendor or mortgagor is out, as that the claimant of theequity, or unrecorded legal right is in, possesion. In this casean insuperable difficulty in the way of appellant arises from thewant of the essential element of exclusiveness in her holding.Although she may have had a sort of possession or occupancy, thatof her sons, the mortgagors, was of a much more decidedcharacter. A clear, unincumbered record title was found in them; they were in the apparent and open possession of the property, under claim of entire ownership; and the mere fact that theirwidowed mother, who was in a measure under their care andprotection, resided on the place and cultivated a portion of theland, would not suggest to an intending purchaser, inspectingthe property, that she had any secret, legal or equitable claimin hostility to her sons, and, hence, would not charge themortgagee with constructive notice of her asserted vendor's lienunder a supposed transfer from her husband. * * *" (Emphasis added in part.)
As stated in Lindley v. Martindale, 78 Iowa 379,43 N.W. 233, possession, to constitute notice, must be open, visible,exclusive and inconsistent with the record title.
"* * * If the possession is not exclusive, or is not of a character to fairly give information that the occupant is asserting dominion over the property under some claim of right or authority, it will not operate as notice. * * *" Ranney v.Hardy — Zeller v. Bading, 43 Ohio St. 157.
"The variety of mixed possession most likely to lull the observer into satisfaction with the apparent ownership is that in which the record title inheres in one of two or more persons living upon the premises in a familial relationship. It seems extremely harsh to affect the stranger with a duty to inquire whether some other member of the family in residence may have a hostile claim to the land, not apparent of record. The cases unanimously refuse to impose this duty upon him. One of the most common situations is where the record title is in the husband; and the wife, or reputed wife, living with him, has an outstanding claim." 1 Merrill on Notice, 163, Section 137. *Page 559 
Earl Chaney's occupancy and cultivation of the entire farm was accompanied by all the usual incidents of ownership. In 41 Ohio Jurisprudence (2d), 41 and 42, Sections 19 and 20, in discussing the character of possession necessary to show rights evidenced by such possession, it is stated:
"On the other hand — and consistently with the principle that whether notice will be imputed from the existence of facts exciting inquiry depends to some extent upon whether the particular right, title, or interest in question is of a sort reasonably suggested by the circumstances — it appears that the constructive notice conveyed by possession may, in some particulars at least, be restricted by the apparent character of the right or title referable to the possession. * * * And if outstanding possession of real estate is consistent with the facts appearing of record, a purchaser is not ordinarily charged with notice of some different or additional right. In the latter case, the generality of notice arising from possession is restricted by the particular title recorded.
"* * * What will constitute such possession of land as to puta purchaser upon inquiry is a question which must depend uponthe circumstances of each case; no strict rule can be laid down.At any rate, the possession must be of an adverse character notonly in fact but in appearance as well, and must fairly giveinformation that the occupant is asserting dominion over theproperty under some claim of right or authority. * * *" (Emphasis added.)
The subject of what constitutes notice to a mortgagee is discussed in 37 Ohio Jurisprudence (2d), 338, Section 154, and we find therein stated the following:
"In regard to the character of the possession, a mortgagee will be chargeable with notice of prior equities where there has been actual, exclusive, and notorious possession of the property by the holder of such equities. If the possession is notexclusive, or is not of a character to give information that theoccupant is asserting dominion over the property under someclaim or right or authority, it will not operate as notice.There must be something in the acts which accompany possession ofproperty, in order to give constructive notice, which can beseen and understood — something that will induce inquiry — andwhich will naturally raise the question as to who may haverights there. * * *." (Emphasis added.) *Page 560 
In this action, the appellant was one of the grantors in the deed of general warranty conveying the 80 acres to her son, Earl Chaney. The record further shows that she knew that her son was negotiating a loan from the Tiffin Bank and using the 80 acres as part security for the loan and further that a part of the money to be secured from such loan would be used to discharge a prior mortgage on the 80-acre tract, upon which prior mortgage she was liable.
The contract of lease was not placed on record until after the order of sale of the 80 acres was issued in the present action.
It is apparent from the record that the appellant intentionally concealed from the Tiffin Bank any claim or interest in the real estate she might have by reason of her lease of the buildings. On cross-examination, the appellant testified as follows:
"35. Isn't it the first time, in October, 1959, that you told anybody about this life estate? Isn't it true? A. What?
"36. You never told anybody involved in this today that you had any rights in this property. Is that true? If not, tell me where it is not true. A. Your question?
"37. Up to the day of the actual sale you never said anything to the people here that you are interested in that property, or had any rights in this property? A. We had hopes of getting the money and wouldn't have to have this mess.
"38. And wouldn't have to disclose the life estate? A. We had hopes of getting it settled without a smear about this whole thing."
Appellant's possession of the buildings under the conditions and circumstances shown in the record was not of such a character as to be inconsistent with a clear title in Earl Chaney, which appellant had conveyed to him, and was not of such a character as to constitute constructive notice of any hostile interest claimed in the real estate.
As hereinbefore stated, what constitutes constructive notice depends upon the circumstances of each case. In the instant case the record furnishes ample and convincing evidence that the possession of the buildings by the appellant was not of such a character as to put the Tiffin Bank upon inquiry as to the nature of her possession. The trial court in weighing the *Page 561 
evidence was fully justified in holding that the mortgage liens of the Tiffin Bank were superior to the appellant's lease on the buildings. To this extent appellant's first assignment of error, in my opinion, is without merit, and the judgment of the trial court should be affirmed.