1. In Illinois, open, visible, and exclusive possession of lands
by a person, under a contract for a conveyance of them to him, is
constructive notice of his title to creditors and subsequent
purchasers.
2. A., the owner in fee of certain lands, having mortgaged them
to B., to secure a debt, contracted in writing to sell and convey
them to C., who thereupon, pursuant to the contract, entered on
them, and thereafter remained in the open and visible possession of
them. The assignee of B. subsequently brought suit to foreclose the
mortgage, but failed to make C. a party. A decree by default was
rendered under which the lands were sold to D., who conveyed them
to B., after C. had paid to A. all that was due upon the contract,
and received from him a deed, which was in due time recorded. B.
brought ejectment, and C. filed his bill to redeem.
Held
that C., not having been served with process, was not bound by the
foreclosure proceedings, and that the title which passed by the
sale under them was subject to his right of redemption.
In April, 1858, Luther Hall, tenant in fee of certain lands in
Illinois, mortgaged them to Lauren A. Noyes, to secure the payment
of $1,075, and on June 4, 1859, made a contract, in writing, to
sell them to Hollis S. Hall, for $3,000, payable in installments.
In February, 1860, the latter sold his interest in the lands to
Wright C. Hall, who paid him $300, and assumed the conditions of
his contract by making a new one with said Luther, of the same date
and tenor. In March, 1860, said Wright enclosed the lands, and from
that date has had open, continuous, and visible possession of them.
His contract with said Luther was never recorded. Feb. 10, 1864, by
deed recorded on the 19th of that month, Luther, having received
all the installments of the purchase money for the lands, conveyed
them to said Wright.
In May, 1861, Woodward, assignee of said Noyes, brought
Page 97 U. S. 35
suit in the Circuit Court of the United States for the Northern
District of Illinois, to foreclose the mortgage, but failed to make
said Wright a party. A decree by default was entered, under which
the lands were sold in October, 1861, by a master of the court, and
purchased for $400, by one Pickering. The balance of the mortgage
debt was satisfied by sales of other property. Sept. 1, 1871,
Pickering duly conveyed the lands to said Noyes, who, in October,
1872, brought ejectment against said Wright. The latter, on
December 14, following, filed this bill, praying that the further
prosecution of that action be restrained, and that he be allowed to
redeem the lands.
The court decreed that said Wright was the owner in fee of the
premises, and was entitled to redeem by paying $400, the amount bid
at the master's sale, with interest thereon from the date of said
sale, at the rate prescribed by the mortgage, amounting in all to
the sum of $933.33. From that decree Noyes appealed to this
Court.
MR. JUSTICE CLIFFORD delivered the opinion of the Court.
Antecedent to the claim of the respondent, the unencumbered fee
simple title of the premises was in the father of the complainant.
On the 26th of April, 1858, the owner of the tract, consisting of a
farm of eighty acres, being indebted to the respondent in the sum
of $1,075, mortgaged the farm to him to secure the payment of that
sum.
Sufficient also appears to show that the fee simple owner of the
premises, on the 4th of June, 1859, contracted in writing with the
brother of the complainant to convey the same to the other
contracting party for the sum of $3,000, payments to be made as
therein specified, and that the brother, eight months later, sold
out his interest thus acquired to the complainant, the new contract
being made by consent to bear the same date as that previously
given to the brother, the complainant giving his notes in the place
of those given by the brother, except for $300, which he paid in
cash. Payments, except for that amount, were to be made as in the
previous arrangement, and the complainant alleges that prior to the
commencement of the next
Page 97 U. S. 36
year he entered into the possession of the premises, and that he
has continued in the possession of the same from that time to the
present.
By the terms of the agreement, the premises were to be conveyed
to the complainant by a good and sufficient deed, and he alleges
that the covenantor and his wife, on the 10th of February, 1864, by
deed duly executed and acknowledged, conveyed the same to him, and
it appears that the deed, on the 19th of the same month, was duly
recorded.
Process was served, and the respondent appeared and filed an
answer, in which he sets up the mortgage given by the original
owner, the foreclosure of the same, the sale of the premises by the
master, and his title to the same by virtue of the master's deed to
the purchaser from whom he acquired the title to the premises.
Proofs were taken, the parties heard, and the court entered a
decree in favor of the complainant.
Due appeal was taken by the respondent to this court; and he
assigns, among others, the following errors:
1. That the complainant has not made such a case as to warrant a
court of equity in granting him relief.
2. That the bill of complaint does not allege any sufficient
reason why it was not commenced at an earlier date.
3. That the bill of complaint does not allege that any tender of
the amount required to redeem the mortgage was ever made before the
commencement of the present suit.
4. That the contract to convey the land to the complainant was
subsequent to the execution of the mortgage.
Both of the notes secured by the mortgage were transferred, and
it appears that the assignee instituted the suit for foreclosure.
When the foreclosure suit was commenced, the present complainant
was in possession of the premises, having previously paid $1,000
towards the purchase of the same under his contract, and the record
shows that he was not notified of the commencement or pendency of
the suit.
Though in the sole possession of the premises, the complainant
alleges that he was not served with process, and that no answer
having been filed in the case, the bill of complaint was taken as
confessed, and that a decree of foreclosure was entered, under
which the premises were sold by the master for the sum of $400.
Page 97 U. S. 37
None of these matters are controverted, and it is also alleged
that conveyance of the premises in due form was made by the master
to the bidder, and that he conveyed the same to the respondent.
Since that time, as the complainant alleges, the respondent has
commenced a suit against him to recover the possession of the
premises.
All of these matters are formally set forth in the bill of
complaint, and the complainant alleges that the respondent neither
claims nor has any other or further interest or title to the
premises than that derived by purchase under the decree of
foreclosure, and he avers that such title is subject to his right
to redeem the premises described in the bill of complaint.
Appropriate allegations are also made to show that he is entitled
to such relief upon the ground that he has been at all times since
the sale of the premises ready and anxious to redeem the same from
the sale and purchase; that he has offered to redeem the premises
of the respondent by the payment of the said sum of $400, with
interest at the rate of ten percent from the date of the sale to
the time of such tender of redemption, and that the respondent
refused and still refuses to accept such payment and to release the
claim and title to the premises by him so acquired, wherefore he
prays that he may be declared entitled to redeem the premises by
the payment of the amount of the purchase money, with interest to
the date of the decree, and that the respondent, upon the payment
of such amount, may be decreed to convey to the complainant all the
title and interest in the premises which he acquired by such
purchase.
Deeds, mortgages, and other instruments of writing which are
authorized to be recorded, take effect, by the law of that state,
from and after the time of filing the same for record, and operate
as notice to creditors and subsequent purchasers. Rev.Stat. of
Illinois, 1874, 278, sec. 30.
Argument to show that the respondent had due notice of the claim
of the complainant is quite unnecessary, as the case shows beyond
controversy that the deed under which he acquired the title to the
premises was duly recorded, and that he was before that time in the
open, visible, and exclusive possession of the same, which, by the
settled law of that State, is
Page 97 U. S. 38
constructive notice to creditors and subsequent purchasers.
Truesdale v. Ford, 37 Ill. 210.
Record evidence of a conveyance operates as notice, and so may
open possession, the rule being that actual, visible, and open
possession is equivalent to registry.
Cabeen v.
Breckenridge, 48
id. 91;
Dunlap v. Wilson,
32
id. 517;
Bradley v. Snyder, 14
id.
263.
Viewed in the light of these authorities and the allegations in
the bill of complaint, it is clear that the first assignment of
error must be overruled.
Nor is it necessary to enter into any discussion of the second
error assigned, as it appears that the complainant filed the bill
of complaint to redeem the premises as soon as it became necessary
to vindicate his title and possession against the ejectment suit
instituted by the respondent.
Beyond all doubt, the contract under which the complainant
claims the right to purchase the premises is subject to the
mortgage held by the respondent, but it is a sufficient answer to
the third and fourth assignments of error to say that the decree
sustains the validity of the mortgage, and makes ample provision to
secure to the respondent all the rights which he acquired by virtue
of the sale and purchase under the foreclosure. Parties interested
in the premises who were not served with process are not bound by
that decree, and it follows that the respondent took his title
subject to the rights of the complainant acquired under the deed,
just the same as if no such decree had ever been made.
Suppose that is so, then it only remains to examine the decree
and ascertain whether it makes due provision to preserve all the
rights of the respondent.
Coming to the proofs, it will be sufficient to say that the
finding of the court below shows that all the material allegations
of the bill of complaint are fully sustained, which is all that
need be said in support of the theory of fact embodied in the
decree. Such being the fact, the court decreed that the complainant
was entitled to relief, he paying to the respondent, within one
hundred days from the date of the decree, the sum of $913.33, with
costs of suit, and that in default of such payment the bill of
complaint shall stand dismissed, and that the
Page 97 U. S. 39
respondent, if the payment be made, shall, within thirty days
thereafter, execute to the complainant a good and sufficient deed,
as prayed in the bill of complaint.
Examined in the light of these suggestions, as the case should
be, it is clear that the decree is correct, and we are all of the
opinion that there is no error in the record.
Decree affirmed.
