Court Opinion

ID: 9811346
Source: CourtListenerOpinion
Date Created: 2023-08-31 22:18:06.313095+00
Date Added: 2024-06-11T15:12:51.424543
License: Public Domain

Clark, J.,
dissenting. The Ballard Company intervenor did .not claim to be mortgagee in possession, which would have been an open and notorious fact, but rested the case upon its being landlord by virtue of an oral surrender of the .equity of redemption by the mortgagor, and that is found as *74a fact by the jury. It was admitted by both parties that upon that fact the case depended. In Killebrew v. Hines, 104 N. C., 182, it was held that the lien of a creditor who makes advances to the mortgagor to make a crop is superior to that of the mortgagee of the land, because till the entry of the mortgagee the latter is assenting to the mortgagor’s holding-himself out as owner of the crop. In Taylor v. Taylor 112 N. C., 27, it was held that while a vendee, or mortgagor in default, remains in possession of land, the title to the crop is not vested in the mortgagee, or vendor, as landlord. Crinkley v. Egerton, 113 N. C., 444, cites with approval both these cases as applicable where the relation is simply that of vendor and vendee, mortgagor and mortgagee, and holds that in such cases there is no landlord’s lien for rent, but held further in favor of the freedom of contracting that, when there is no oppression, it is competent for the parties to a mortgage for the purchase money to stipulate that, in addition to the mortgage on the purchased land, the vendor should have a lien on the crop to the extent of the rent, the same to be applied on the purchase money and that- when such mortgage is recorded one who advanced supplies upon a later mortgage on the crop took subject to vendor’s mortgage on the rent. In Jones v. Jones, 117 N. C., 254, it was held, approving Taylor v. Taylor, supra, and Crinkley v. Egerton, supra, that the vendee of land in default may by contract, in the absence of oppression, agree verbally that the vendor may have as additional security the landlord’s lien for rent, the amount of same to go upon the purchase money.
There is this difference between Crinkley v. Egerton and Jones v. Jones, that in the first named case the agreement to-give the mortgagee the rights of a landlord over the rent, was embraced in the mortgage which was registered and hence the person subsequently taking a mortgage upon the-crop for advances was fixed with notice of it and hence the *75mortgagor’s right to the rent as against such third party was sustained. " ..
In Jones v. Jones, however, the agreement to give the vendor the benefit of the landlord’s lien upon the rent as additional security was verbal, and it was sustained as between the parties merely.
In the present case there was a similar verbal agreement. This was good as between the parties, as was held in Jones v. Jones, supra, but it can not be good as to third parties as in Crinkley v. Egerton, because unlike that case the agreement was not in writing and recorded and third parties had no notice from any registration. Nor is there any evidence tending to show that the merchant who advanced the supplies had any actual notice, if indeed under Connor’s Act his registered mortgage for supplies could be defeated by a verbal conveyance back of the land from the vendee to the-assignee of the vendor who had been secured by a mortgage-upon the land only, more especially as the mortgagor, notwithstanding the verbal reconveyance, remained in possession.
If the merchant making advances in Killebrew v. Hines-had examined the books in the Register’s office he would have found that his customer had executed a mortgage on his land only and therefore could give him a valid mortgage on the crop. If such merchant had examined the records in Crinldey's case he would have found that his customer had not only mortgaged his land but had conveyed a lien on the rent also as additional security, so that he could only get a valid lien for his advances on the crop over and above the rent. If the merchant making advances in the present case examined, as we must presume-he did, the Register’s books, he would have found that, as in Killebrew v. Hines, the party in possession had given a, mortgage only on the land (and not as in Crinldey's case-conveyed the rent also) and therefore he is' entitled to the-*76crop as it was mortgaged to liim and can not be defeated by a parol agreement which, being unregistered and unknown to him, was only good between the parties as in Jones v. Jones, supra. Even in Crivkley’s case the merchant had his lien on all the ' crop except the rent. Here, it is sought by a verbal agreement between mortgagor and mortgagee to defeat the merchant’s lien for advances not only as to the rent but as to the whole crop.
The wise object of the Act of 1885 (known as Connor’s Act) was to require all conve,vanees and encumbrances upon land to be spread upon the Record so that third parties •could always be protected. Looking at the record here, the merchant was justified in taking from the mortgagor of the land in possession a mortgage upon his crop. To permit .an unknown verbal agreement for the conveyance of land to the mortgagee, by way of a verbal surrender of the equity of redemption, to destroy the mortgage on the crop which was given the merchant by the party in possession claiming to be owner (subject only to the mortgage on the land) would be contrary to the letter and the spirit of the Act of 1895, (Barbee v. Wadsworth, 115 N. C., 29) and would unsettle the •confidence of all who make advances to mortgagors and vendees in possession to enable them to raise their crops.
MONTGOMERY, J.: I concur in the dissenting opinion.