text:
    Hibbs v. Insurance Company.
    1. The will of W. M. contained the following provision : “ I give and devise to my beloved wife, in lieu of dower, the farm on which we now reside, situate in Franklin county, Ohio, containing about two hundred acres, during her natural life. At the death of my said wife, the real estate aforesaid I give, devise and bequeath'to my grandson, William Miller.” The provision in lieu of dower also embraced a bequest to the wife of certain personal property. On the 18th day of November, 1850, the will was duly admitted to probate, and on the same day the widow of the decedent appeared in court and made her statutory election to take under the will. The widow owned in fee simple a tract of eighty acres of land constituting a part of the farm mentioned in the will, which she acquired by inheritance, and of which she held possession until her death — Held: That upon the widow’s election to take, under the will, the grandson became entitled to an equitable estate in remainder in the eighty abres of land.
    2. After the widow’s election she executed a warranty deed of the eighty acres to one J. F., and thereafter borrowed of an insurance company . $4,000, and to secure the payment thereof mortgaged the premises to the company — the company having at the time no actual knowledge of the execution of the will or of the widow’s election to take under the same. The deed to J. F. was not placed on record for more than two years after its date, and more than one year after the execution and record of the mortgage — Held: That the probate of the will and the widow’s election to take under the same were not constructive notice to the mortgagee of the equitable interest of the grandson in the eighty acres of land, and that the mortgagee has the first and superior lien on the premises.
    Ebbob to. tbe District Court of Franklin County.
    On the 8d day of November, 1850, William Miller, Sr., of Franklin county, Ohio, died leaving a last will and testament executed on the 10th day of. August,' 1850, and containing the following provisions:

      Item 1., I give and devise to my beloved wife, in lieu of dower, the farm on which we now reside, situate in Franklin county, Ohio, containing about two hundred acres, during her natural life; and all the stock, household goods, furniture, provisions and other goods and chattels which may be thereon at the time of my decease, qr as much of the same as she may choose to retain during her natural life; and all or any portion of the dividends or interest arising from my bank stock and other moneys at interest, as she may from time to time desire. At the death of my said wife, the real estate aforesaid I give, devise and.be-, cjueath to my grandson, William Miller.
    * * « * *. ■ # * * *

      Item 3. I give and bequeath to. my dear son, Adam (whom I appoint executor of this my last will), all my bank stock and other money at interest in especial trust to and for the uses, and purposes following, to wit: He shall keep the stock and money aforesaid securely and profitably invested, and the dividends and The interest from the same shall be paid over, from time to time, as they may be receivecl, to my beloved wife, during her lifetime, and, upon her decease, the said stocks, with t.he unexpended dividends, shall be for his own use forever.
    Christina Miller, the wife of the testator, was the owner in fee simple, at the date of the will and at the time of her husband’s decease, of a tract of eighty acres of land which was a part of and had become so incorporated with the home farm mentioned in the will as to have lost its identity except upon a careful survey. This tract she acquired by descent from her father, and held possession of the same until her death in the year 1873. On the 18th of November, 1850, the will of William Miller, Sr., was admitted to probate in the court of common pleas, and on the same day, Christina Miller the widow appeared in that court, and publicly elected to take under the will. On the 1st of July, 1870, Christina Miller, in consideration of the sum of one dollar and of love and affection, executed a warranty deed to her brother Jacob Fisher of the above-mentioned tract of eighty acres, which deed was not placed on record until December 7th, 1872. On the 5th day of October, 1871, Christina Miller borrowed of the Union Central Life Insurance Company — the defendant in error — four thousand dollars, for which she executed to the company her promissory note payable in five years after date, “with interest at eight per cent, per annum. Interest payable seini-annually.” To secure the payment of said note, she executed on said 5th day of October, 1871, to the insurance company, a mortgage on the said eighty acres of land, which was duly recorded on the 11th daj* of October, 1871'. Upon non-payment of the note at maturity, the insurance company brought the original action' below to foreclose the mortgage, making Christina Miller, Adin G. Hibbs as guardij n of Christina Miller, Jacob Fisher and , William Miller parties defendant. Upon the death of Mrs. Miller, the defendant Hibbs was appointed her administrator, and was made a defendant in that character. Jacob Fisher defendant has always remained in default. William Miller defendant filed an answer, asserting that he was the grandson of Christina Miller and William Miller, Sr., her husband; and that although Christina Miller owned the mortgaged premises in fee simple prior to the' death of her husband, she had accepted the provisions of her husband’s will, which bequeathed and devised a large part of his estate to her, and devised the premises in question to her for life, with remainder to him; and that under the operation of the law of election, her estate in fee simple had been changed to a life estate only; and that upon her death he became entitled to the premises free from encumbrance by the plaintiff’s mortgage.
    The answer of Hibbs, administrator, alleges, that Christina Miller, at the date of the execution of the mortgage, was very old and imbecile, and totally unable to comprehend the nature of the transaction, and that therefore it was void; and that the note and mortgage were usurious and void.
    None of the officers or agents of the insurance company had actual knowledge of the execution of the will of William Miller, Sr., or of the election of Christina Miller to take under the same.
    The court of common pleas found, on the issues joined, that the equity of the case was with the defendant William Miller, and that by reason of the election of Christina Miller under the will of her husband, her estate in said eighty acres of land became a life estate only; and that the remainder in fee simple thereby became and upon her death vested in fee simple in the defendant William Miller; and that by reason thereof, the plaintiff could not have an order to sell said premises, but must be enjoined from selling the same, and also from holding or claiming title thereto or to any part thereof under or by virtue of the mortgage from Christina Miller.
    On appeal the district court found as follows:
    “ 1st. — That the eighty acres of land in the petition described, Constituted a part of the home farm of about two hundred acres mentioned in the will of William Miller, Sr. .Id — That the said Christina Miller derived her title to the said eighty acres by descent in fee simple from her father’s estate, and that she held the possession of the same until her death. 3d — That she made the statutory-election to take under the will of her deceased husband, William Miller, Sr.; but said election did not divest her of the legal title to said eighty acres of land. 4th — That she also made her election in equity to receive the benefits conferred upon her by the will of her said deceased husband, William Miller, Sr., and that thereby the said William Miller, the defendant herein, became entitled under said will and election, to an equitable interest in the said eighty, acres of land in remainder; but, 5th — That said plaintiff had no notice, either actual or constructive, of the said equitable interest of the said William Miller in said eighty acres of land at the date of said note and mortgage in said petition mentioned. 6th — That, at the time of the execution of said note and mortgage to the sajcl plaintiff, the said Christina Miller was not incapacitated from making the same, and the said plaintiff received the same in good faith and without any notice of an}*- disability on the part of the said Christina Miller to execute the same, and that the said note and mortgage constitute a valid and subsisting contract in favor of said plaintiff; and that there is now due to the said plaintiff upon the same the sum of seven thousand three hundred and fifty-four dollars and twenty-six cents ($7,354.26), being the principal sum of $4,000 and interest thereon at 8 per cent, per annum, payable semi-annually, from the 5th day of October, 1872, to the first day of the present term of this court, to wit: March 19th, 1881, and that the same is not usurious, as claimed by said defendant, but is a valid 'and subsisting lien upon the said eighty acres of land in said mortgage and petition described.”
    The district court also ordered, adjudged and decreed, that the said eighty acres of land be sold, and that the cause be remanded to the court of common pleas to carry the order and decree into execution. William Miller and the administrator of Christina Miller filed their motions to set aside the judgment and order of the district court, and for a new trial, which motions were overruled, and a bill of exceptions was taken embodying all the testimony offered on the hearing of the cause. To reverse the judgment of the district court, the petition in error is prosecuted in this court.

      Henry O. Nolle, H. L. H O. Taylor, for plaintiff in error.
    I. As to the effect of a statutory election, see White v. Brokaw, 14 Ohio St., 839, 348; Jennings v. Jennings, 21 Id., 56; Huston v. Gone, 24 Id., 11, 20; Bane v. Wick, 14 Id., 505, 512; Luigart v. Ripley, 19 Id., 24; Allen v. Gets, 3 Pa., 310; Upshaw v. Upshaw, 2 Hen. & M., 381; Reaves v. Garrett, 34 Ala., 558; Phelps v. Phelps, 20 Pick., 556; Pitts v. Cook, 5 Cash., 596; Barrow v. Barrow, 4 Kay & J., 409; s. C., 4 Jur. N. S., 1049.
    II. What kind of an estate did Wm. Miller, the grandson, acquire in the 80 acres? (a). In part by the devise of his grandfather; without such devise he could have no claim. (5). In part by the election of his grandmother; without her election to take under the will, the devise would have been inoperative, (e). In part by the effect of the statute of wills then in force upon these acts, which directs how wills shall be made and recorded. And so, in part, his title was acquired by operation of law.
    As to the distinction between legal and equitable estates, see Bouvier Law Dio. under title “legal estate.” If the distinction there made is correct, then by her election, even without the statute, the fee simple of Christina Miller in the eighty acres would have been turned into a life estate in her, with remainder in fee to her grandson, according to some of the best and recent authorities on this subject. Kennedy v. Mills, 13 Wend., 555-6; Birmingham v. Kerewan, 2 Sch. & Lef., 451; 2 Leon., 272; Cro. Eliz., 128; Weeks v. Patton, 18 Me., 42; Smith v. Smith, 14 Gray, 532; Howard v. GrettOn, 2 Swanston, 425, note a, towards end of note.
    What is title? It is not anywhere very fully defined, because it is a creature of law, and varies under various systems. But see 8 Greenleaf’s Cruise, 311, 312, § 2. What title is, may be better seen by considering how title is acquired. For this see 3 Cruise’s Dig., 317, 322; 4 Kent’s Com., 373; 6 Greenleafs Cruise, chap. 1, subject “Devises”; Id., chap. 2, § 2, p.. 16..-,
    III. If then the title of Wm. Miller was created by law and was recognizable in courts of law, was it not such a title as to make a record which falls within the rules of constructive notice? See Sections 16, 18, 24 and 33 of the Wills Act of 1840 ; 6 Ohio, 148; Bailey v. Bailey, 8 Ohio, 238, 247; 25 Ohio St., 265; Sheldon v. Newton, 30 Id., 500; Sehroyer v. Biehmond, 16 Id., 455 ; Bavis v. Bavis, 11 Id., 386; 9 Ohio, 96 ; Beeder v. Byan, 4 Id., 446;
    Our claim then is, that by the will of William Miller, confirmed by the election of Christina Miller, and entered of record, the legal estate in remainder in fee was vested in William Miller, plaintiff in error, and that as these acts were all of record, and within the probate jurisdiction of the court of common pleas when done, by virtue of the constitution and laws of Ohio, in force at the time, they were constructive notice to the whole world of his title, and forever binding, not only on Christina Miller, but upon all who claim under or in privity to her. And if Christina Miller could not have questioned the title of William Miller, either in a court of law or equity, after her election, so cannot her grantee, whether a purchaser or mortgagee, claiming under her.

      Bamsey Matthews, for defendant in error.
    1. There was no election by Mrs. Miller, and the will required none.
    The law requires that the intention of the testator to require such election shall be clear. Story’s Equity, Sec. 1089; Blake v. Bunbury, 1 Yes. Jr., 515; Banclyffe v. Parhyns, 6 Dow., 149; Billon v. Parker, 1 Swanst. R., 404, and note.
    It is by no means clear that William Miller intended to ' devise his wife’s property to his grandson. The reference to the home farm, containing about 200 acres, is not explicit enough for this purpose. Prima facie, all the bequests and. devises of a will are gifts.
    The provision made for Mrs. Miller in that will is expressly declared to be “ in lieu of dower.” It is an inflexible rule of construction that where a donation is made, in lieu of one thing, that there can be no election required between the donation and any other thing. Story’s Equity, Sec. 1090; JEastvt Coolc, 2 Yes., 23; Dillon v. Parker, 1 Swanst., 404, and note.
    2. If it should appear to this court that Mrs. Miller was called upon by this will to make an election, whether she would give up her fee simple estate for a life estate in her own property, no such election has been shown. The statutory election required of the widow is simply her election between the provision of the will and the provision of the law made for her in her husband’s estate. Carder v.' Fayette County, 16 Ohio St., 353.
    To make a binding election two things must concur.
    1st. There must be intention to .elect.
    2d. It must be shown that the party making the election was fully advised as to bis or her legal and equitable rights. Huston v. Cone, 24 Ohio 'St., 22; Spread v. Morgan, 11 H. L., 588; Padbury v. Clark., 2 Maen. & Gord., 298; Fitts v. Cook, 5 Cush., 596.
    3. As to notice :
    One about to purchase land in Ohio, whether by deed or mortgage, is required: 1st. To examine the record of deeds. He is not required to examine for conveyances made by any one save his own grantor. American note to Le Neve v. Le Neve, page 181, Leading Equity Cases, 3d American Ed.; Lieby v. Wolf, 10 Ohio, 33; Blake v. Craham, 6 Ohio St., 580; Murray v. Ballou, 1 Johnson Chan., 556; and the many authorities cited in Mr. Hare’s note to Le Neve v. Le Neve.

    2d. He is required to ascertain the name of the person in possession, “actual, unequivocal possession,” and to inquire what the rights of that person are.

      8d. He is required upon principles of general jurisprudence to examine the docket of pending suits in the county where the land lies, to see if suits are pending against the person in possession, or the person holding the legal title of record, affecting the title to the property.
    4th. By virtue of section 79 of the Code of Civil Procedure of Ohio, section 5,056 Revised Statutes, he is required to ascertain whether 'a final decree has been entered in any' action against his grantor; in the absence of statutory provision, he would not be required to make this examination. Wolsey v. Marl of Scarborough, 3 Atkins, 332; Turner v. Crebill, 1 Ohio, 373; Hilliard on Vendors, 147; and Fox v. Feeder, 28 Ohio State, 184.
    Having complied with these requirements he may pur- ' chase in absolute safety.
    In the present case the Union Central Company complied with all of them; it found Christina Miller in actual, unequivocal possession: it found her holding the legal title of record as an heir of her father; and by virtue of partition proceedings had between his heirs; there was no suit pending against her, and no final decree had been entered against her touching this property.
    The proceeding relied upon in this case as constituting notice was one which had no relation to this property, it had relation only to the disposition of the estate of William Miller, and was merely the admission to record of his individual will concerning that subject.
    If William Miller had executed and delivered a deed of Christina Miller’s property, and it had been placed oii record, a purchaser would not have been bound to take any notice of it. Blake v. Graham, 6 Ohio St., 580, and authorities cited. How, then, could he create a legal title to it, by a will disposing of his own estate ?
    Again, this proceeding for the probate of William Miller’s will was fully ended and determined in 1850; it could not be said to be a Us pendens in any sense after that date, if it had ever been such.
   Dickman, J.

The first question which naturally arises jpon the record is, Was Christina Miller so weak and imbecile that she was incapable of comprehending the transaction of executing the note and mortgage. It is quite manifest, that she was then laboring under the usual infirmities of old age — that time had somewhat impaired her physical strength, and that her mind had lost somewhat of its energy. But, upon a careful review of all the testimony, we are not prepared to say, that the district court erred in its conclusion that she was not incapacitated to make the note and mortgage at the time of their execution. She might not have been competent to profitably manage so large a sum of money as was loaned, and yet be sufficiently intelligent to know, that she had given her note and a mortgage to secure its payment, aiid that if not paid at maturity, the mortgaged property would be sold and so pass out of her hands. Whatever methods may have been resorted to by her relatives to induce her to incur the obligation, we do not find that any fraud or undue influence was practiced upon her by the insurance company or its agents; and we think, that the company received the note and mortgage without any notice of any disability on her part to execute the same.

It is claimed that the note given was usurious, by reason of its drawing interest at the rate of eight per cent, per annum payable semi-annually. This court has held in the case of Cook et al. v. Courtright, on error to the district court of Richland county, that under the act of May 4, 1869 (66 Ohio L., 91), a promissory note stipulating for the payment of the principal at a future time, with interest thereon at eight per cent, per annum payable semi-annually until paid, is not usurious. From that decision we find no reason to depart.

Other questions presented for the determination of the court, arise out of the election of the widow to take under the will of her husband. The testator devised and bequeathed to his wife in lieu of dower, the home farm on which he resided, containing about two hundred acres, with all the goods and chattels thereon, during her natural life, together with the income of a large trust fund. The home farm was devised — at her death — to the testator’s grandson, William Miller. The presumption under the statute would be, that this provision in favor of the testator’s wife Avas in lieu of dower and her distributive share of the personal estate, unless an intention to the contrary plainly appeared in the will. But, the testator fortified that presumption by using the unambiguous words, “in lieu of dower.”

At the date of the will, and at the time of her husband’s decease, Christina Miller owned in fee simple a tract of eighty acres of land inherited from her father, which had become so incorporated Avith the home farm, that its identity Avas lost except on a careful survey. The testator therefore had devised to her a life estate in her own land, Avith a remainder to his grandson.

In November, 1850, on the day of the probate of the Avill, the AvidoAV appeared in court, and elected to take under the will the provision made for her in lieu of dower. Up to the time of her death, she remained in the use and occupation of the home farm, enjoyed the income from the trust fund, and continued for nearly twenty years after her election fully satisfied Avith all the terms and provisions of the Avill. It is obvious in view .of Avell-established legal principles, that the relation of the widoAV to the tract of eighty acres, Avas not the same after her election as it was before. By the devise and her election under the will, her estate in the premises was, Ave are of opinion, converted into a life estate with remainder to the grandson.

The doctrine of election, as stated by an approved text Avriter, requires, that if a testator has affected to dispose of property which is not his oavii, and has given a benefit to the person to whom that property belongs, the devisee or legatee accepting the benefit so given to him must make good the testator's attempted disposition; but, if on the contrary he chooses to enforce his proprietary rights against the testator’s disposition, equity will sequester the property given to him', for the purpose of making satisfaction out of it to the person whom he has disappointed by the assertion of those rights. As said, too, by Welch, J., in Huston v. Cone, 24 Ohio St., 11: “It is a well-settled principle of equity, that where a will assumes to give to one of its beneficiaries property belonging to another person, for whom provision is likewise made in the will, the latter is bound to elect whether he will claim the property so disposed of, or take the provision made for him in the will; and that he cannot have both.” See also, White v. Brokaw, 14 Ohio St., 339; Jennings v. Jennings, 21 Id., 56. So firm is the principle that one cannot claim both under the will and adversely to it, that in disposing of that which is not his own, it seems to be immaterial whether the testator is acquainted with his want of title, or supposes that he is exercising a > power of disposition that belongs to him. Whistler v. Webster, 2 Ves., Jr., 370.

The obligation imposed upon a party to choose between two inconsistent claims, in cases where it is the clear intention of the testator from whom he derives one, that he should not enjoy the benefits of both, rests upon the soundest principles of equity. Indeed, the doctrine of election is the peculiar subject of the jurisdiction of courts of equity. It is a creature of equity, although regulated by statute as to the time, place, manner, requisites and effect of the election. One of the main objects of the statute is to remove the fact of the widow’s election from the domain of uncertainty; and that she may act deliberately and understandingly, she is allowed one year after the probate of the will, within which 'to make her election. But the doctrine of election is none the less of equitable origin because under statutory regulation.

It is no exception to the equitable rule which we have been considering, that the devisee or legatee is the widow of the testator. In Allen v. Getz, 2 Penn. R., 310, after stating the rule, that the devisee who accepts a devise under a will by which the testator has devised the estate of such devisee to another person, thereby elects to give up all his right and title to such estate, the court says, that “ no reason can be assigned why the widow of the testator should be exempt from the operation of the rule. It is founded in great justice, for no one could well imagine that the testator would have devised or bequeathed such portion of his estate, even to his wife', if he had known that she would oppose his will in another part, by claiming and taking the part which he had thereby given to another.”

In the case of Tomlin v. Jayne, 14 B. Mon., 160, it was held, that although Tomlin had not ’the right of disposing by will of his wife’s interest in her father’s estate not reduced to possession, yet, as he did undertake to dispose of it by his will, in which he also gave his wife one half of his own personalty, a case was made for election by the wife. The wife, it was said, could not hold under the will what her husband had a right to dispose of, and at the same time hold independently of the will and against it, property which, although it was in fact hers and not her husband’s, he had expressly disposed of by his will.

In Cox v. Rogers, 77 Pa. St., 160, the testator provided, “ I do will to my son, his heirs and assigns, my farm, subject to my wife’s thirds.” The wife owned the farm. She accepted and retained a legacy of the personal property. It was held that she, and her. heirs after her death, were estopped from claiming the farm; and that the legal presumption was, that the wife knew that if she accepted the legacy, she would be estopped from claiming the farm as her own.

The principle is announced in Clay v. Hart, 7 Dana, 1, that where a testator devises a greater or other interest in his wife’s estate than he has, if she elects to abide by the will, her independent right to the property devised by it is thereby waived. In support of the same principle, see Reaves v. Garrett, 34 Ala., 558; Upshaw v. Upshaw, 2 Hen. & Mun., 381. These and other cases which might be cited are applications of the rule declared at an early date by Lord Chancellor Talbot, in Streatfield v. Streatfield (cases temp. Talbot, 176), “Where a man takes upon him to devise what he has no power over, upon a supposition that his will will be acquiesced under, this court compels the devisee, if he will take advantage of the will, to take entirely, but not partially under it; there being a tacit condition annexed to all devises of this nature, that the devisee do not disturb the disposition which the devisor hath made.”

Our attention however is called to the case of. Carder v. Com’rs. of Fayette county, 16 Ohio St., 353, in which it is said by Welch, J., “that the election of the widow to take under the will does not estop her from contesting the will, denying the validity of its devises, or setting up her claims as heir.” It may be conceded that the right to contest a will because of its invalidity, or to set up a claim as heir to yaroperty not embraced in the will, should not be taken away by the widow’s election; and yet, it may be unreasonable that the widow, in a case like the one at bar,'after electing to take the provision made for her out of her husband’s estate, should be permitted to thwart the testator’s intention, and disappoint other persons by claiming property, though her own, which the testator had devised to them. As well remarked by Mc’Ilvaine, J., in Bowen v. Bowen, 34 Ohio St., 164, “whether or not any other interest or claim” (besides dower) “which a widow may have in, or against the estate of'her husband, is satisfied by provisions in her favor in his will, must be determined not by the rule of the statute, but upon principles of reason and right which exist entirely independent of the statute.”

Holding as we do, that the election of Christina Miller to take under the will of her husband, devolved upon her grandson a right in remainder in the eighty acres of land, we are led to inquire, whether that right was a legal or equitable one. In our view, he acquired an equitable interest. If a testator assumes to dispose of the property of his devisee in favor of a third person, it is obvious, that not being the owner, he cannot transfer the legal interest in the property. The testator, William Miller, Sr., had no power of. testamentary disposition .over the separate estate of his wife. A devise by him of his wife’s property in express terms to his grandson, could not alone vest any interest. Without the supplementary act of the widow electing to take under the will, the devise to the grandson could not prove otherwise than nugatory. The rights which the grandson might acquire by virtue of the widow’s election, had their foundation in equitable principles. If there had been no statute regulating the widow’s election, the grandson, by virtue of Christina Miller’s election to accept the provision in lieu of dower, might have acquired the same property rights as upon a statutory election by the widow. The estate therefore of William Miller in the eighty acres depended not, under the will, primarily upon the operation of the statute, but upon the operation of equitable principles antecedent to the statute. By electing to take under the will, Christina Miller may have been equitably estopped from setting up her legal title as against her grandson, but, under the statute then in force, her election did not, we think, operate as a decree in chancery against her, for a conveyance to her grandson of the eighty acres, subject to her life estate.

But, while William Miller was entitled upon the death of his grandmother to an equitable estate in fee simple in the eighty acres in question, the insurance company, as mortgagee, stood in the position of a bona fide purchaser of the premises, for value, and without notice. It is conceded in the record that the company had no actual knowledge of the execution of the will of William Miller, Sr., or of the election of Christina Miller to take under the will, and we do not regard the company as chargeable with constructive notice of the grandson’s interest in remainder.

Doubtless, the probate of the will and the widow’s election to take under the same, were constructive notice to the company of the disposition of the testator’s estate, but not of the wife’s separate property. A purchaser from her of her land would not have been bound to take notice of a ■ deed of the same by another person, who was unauthorized to make the deed. The record or registry of a-deed is constructive notice only to those who claim through or under the grantor by whom such deed was executed. Blake v. Graham, 6 Ohio St., 580; Leiby v. Wolf, 10 Ohio, 83. And the owners of land cannot with any color of reason or authority, be required to watch the records to determine whether some one has without right made conveyances of their lands. The rule, which would protect a purchaser against the operation of a deed of his grantor’s property made by a stranger without authority, is not, we conceive, inapplicable to the case of a testator’s assuming to devise property to which he has no title. In either case, the purchaser cannot be chargeable with constructive notice of the unauthorized act.

At the date of the execution of the mortgage to the company, Christina Miller was in the actual undisputed possession of the mortgaged premises. The fact was well known, that she derived title to the land by descent from her father, and by virtue of partition proceedings had between his heirs. The registry of deeds showed that the land was unincumbered. There was no suit pending against her, and no unsatisfied judgment or decree existed against her, affecting her title to the land. Assuming, that the probate of her husband’s will would have been constructive notice of his devise of her land to another, if the same had been identified as hers, the will, from its want of such identification, would not constitute constructive notice to any innocent purchaser. For the .purpose of constructive notice to the mortgagee, the proceeding for the probate of the will of William Miller, Sr., and the widow’s election thereunder, cannot be regarded as lis pendens, nor operate as a judgment or decree as to Christina Miller.

After her election to take under the will, in consideration of one dollar and love and affection, she executed a rvarranty deed of the eighty acres to Jacob Fisher, her brother. Fisher’s deed — of which the company had no actual knowledge when the mortgage to it was executed — was not placed on record for more than two years after its date, and more than one year after the execution and record of the mortgage. Not having been recorded within six months, the deed was fraudulent as against the mortgage. The mortgage thus gained priority of the deed, and after condition broken, the title to the mortgaged premises, as between the parties, vested in the mortgagee. The mortgagee might then have maintained ejectment to recover possession of the premises. Heighway v. Pendleton, 15 Ohio, 785; Ely v. McGuire, 2 Id., 223; Allen v. Everly, 24 Ohio St., 97; Williams v. Englebrecht, 37 Id., 383.

The defendant in error being an innocent purchaser, for value, and without notice of William Miller’s equitable interest,, and its lien on'the mortgaged premises being first in order of priority, the judgment of the district court must be affirmed.

Judgment accordingly.


source: Caselaw Access Project

author: Granger, C. J.

license: Public Domain

text:
    Coal Company v. Mining Company.
    1. In construing a written instrument, effect should he given to all of its words, if this can be done by any reasonable interpretation.
    2. A clause making a grant passes everything included within the ordinary meaning of its words, unless it clearly appears from an inspection of the entire instrument, read in the light of the relation of the parties to the subject matter of the contract when it was made, that the words were used in a more limited sense.
    Ekroe, to the District Court of Medina County.
    On the 16th day of November, A. D. 1872, two Ohio corporations, the Silver Creek Mining and Railway Company; of the first part, and the Wadsworth Coal Company, of the second part, executed a contract under seal, of which the following is a copy, to wit:
    “This agreement made and entered into at Cleveland, Ohio, this sixteenth day of November, A. D. 1872, by and between “ The Silver Creek Mining and Railway Co.” party of the first part, and “The Wadsworth Coal Co.” party of the second part, Witnesseth. That the said party of the first'part, in consideration of the rents and profits hereinafter named to be paid, and the úndertakings and agreements to be performed by the party of the second part-, hereby lease and let to the party of the second part for the term of till coal is mined, commencing at the date hereof, all the “ mineral coal in the following described land formerly known as and being lands situate in the township of Wadsworth, county of Medina and state of Ohio, bounded and located as follows:
    “ Being in lot two and tract one. Beginning at the southeast corner of Isrial Ritter’s land, both being lot two of ■ tract number one, or-Wadsworth tract, and running west 84 chains, thence south so far that a line is formed parallel' with the first mentioned line, and on the east by the township line and south by part of lot two, and west by lot eleven, the same to contain fifty acres of land.
    “And also a part of lot two in Township No. 1, Range 13, the Connecticut Western Reserve, and in the township of Wadsworth. Commencing at. the northwest corner of said lot, thence running south 89 deg. 8 min., east 32 chains and 25 links, thence south one half degree, west 5 chains and 71 and one fourth links, thence north 89 deg. and 8 min., west 33 chains and" 25 links, thence north 30 min., east 5 chains and 21 and one fourth links to the place of beginning, containing nineteen acres of land. Also a tract of land belonging to John Whitman and bounded as follows: On the north by the above described nineteen acres, east by the township line, on the south by the township line, on the west by land owned by David Long, containing one hundred and six acres more or less, together with the right to immediately enter upon said land, mine and remove and dispose of said coal for their own benefit and use.
    “ And the party of the second part hereby agree to commence without delay, and continue to open a coal mine, and erect the necessary structures and machinery on, said land to carry on the business of mining as herein contemplated and defined, to wit: “ To mine and remove at least twenty thousand tons of coal between the date of this agreement and the 81st day of December, A. D. 1874, eighteen hundred and seventy-four inclusive. To mine and remove at least twenty thousand tons of coal during the year thereafter ending the thirty-first day of December, 1875, and each and every year after the thirty-first day of December, a.d. 1875, the amount of coal to be mined and removed to be at least twenty thousand tons, until the termination of this lease or contract, and the said party of the second part agree to mine and remove the amounts as specified, and to pay to the party of the first part forty cents for each and every ton of 2,150 pounds of coal in condition as taken from mine, mined in said premises. Payments to be made at office of the Silver Oreek Mining and Railway Co., quarterly (after mining is commenced), that is, on the first day of April, July, October and January of each and every year, after the first day of January, 1873, and during the continuance of this agreement payments shall be made at the rate aforesaid, for the amounts of coal mined during the three months next preceding these dates, and any amount due and not paid at the time specified for its payment shall draw interest at the rate of ten per cent, per annum until paid; and it is further agreed that if the party of the second part shall fail to mine during any quarter year, the quarterly portion of the amount of coal stipulated herein to be mined in that year, then the party of the second part shall pay to the party of the first part the sum to which said quarterly portion would amount the same as if it had been mined, but said sum shall be considered as advance payment to apply on the first coal mined thereafter in excess of the stipulated quality [quantity] .except in case of general strike of miners in the district in which said mine is located, in which event the party of the second part shall not be held to pay said quarterly portion as above mentioned, but an allowance shall be made to cover the time of said stoppage. And the party of the first part hereby grant to the party of the second part the use and occupancy of four acres of said land in a compact form during the term of this agreement on which the party of the second part agree to put up and maintain a suitable fence, open the mine, erect machinery and construct chutes, screens, roads and drains, so as to carry on the business of mining advantageously. All of which machinery, and structures and improvements shall remain undisturbed and unimpaired until the termination of this contract.
    “ And the party of the second part agree to erect scales of approved manufacture at the mouth of the mine on which all the coal mined shall be weighed accurately, to keep just and accurate accounts and records of all coal mined, sold and shipped in approved form so as to be easily examined, and to furnish to the party of the first part or assigns statements of the same at least quarterly at the periods heretofore mentioned. And the party of the first part or assigns shall have at all reasonable hours the right to examine, survey and inspect the mines, books of accounts and records; and the party of the second part agree to open and- work the mine in a good substantial and workmanlike manner, leaving sufficient pillars of coal and timbers and props to support the roof until the coal is all exhausted. And to mine from year to year so that the thin as well as [thick] coal shall be taken out in proper proportion as the work progresses.
    “ It is further agreed that if the party of the second part fail to make any payments herein specified at the time provided and refuse or neglect to pay the sum [same] for a period of four months after the time it is due, then the party of the first part or assigns, if they so elect, may take at any time thereafter full possession of the mine, machinery, fixtures, implements and conveniences on such land and use the same as they deem proper to carry on mining and removal of coal from said land until it is exhausted. The party of the second part considering such possession and use a proper forfeiture for their failure to pay. And the party of the first part may cancel this contract on taking possession as aforesaid, reserving to themselves their right of damages.
    “It is further agreed that if before the term of this agreement is expired the coal should be exhausted from said land and none remains to be mined, then the party of the second part shall have the right to remove all machinery and fixtures from the premises provided no unnecessary,damage is done to the land, and all accounts between the parties hereto are settled and paid, and thus' terminate this contract.
    “ It is further agreed by the parties hereto that the aforesaid coal shall be mined through an opening or openings oñ the surface of said land, and that the failure of the party of the second part to make the necessary shafts, slopes or drifts and construct machinery and fixtures on the premises as herein described before the 31st day of December, A. D., 1873, shall be a forfeiture on their part to any further rights in this contract if the party of the first part so elect. And it is also agreed that for any coal that the party of thé second part shall remove from other lands through, over or above said described land, the said second party shall have all the rights now possessed by the party of the first part. ' “ The parties hereto respectively bind themselves, their heirs, administrators and assigns to the performance of this agreement.
    “ In witness whereof we have hereunto set our hands and seals the day and year above written.
    “Silver Creek Mining and Railway Co., r -, “By J.F Card, President. Lseal.J
    “The Wadsworth Coal Company,1 r , “ By John J. Wagoner, President. ISEAL,J
    “ In presence of C. L. Latimer,
    “Nichs. Ames.”
    “ The State of Ohio, Cuyahoga County, ss:

    . “Personally appeared before me, C. L. Latimer, notary public, within and for said county, Jonathan F. Card, president of the Silver Creek Mining and Railway Company, and as such acknowledged the signing and sealing of the foregoing instrument as the act and deed of said company, and as his act and deed as president of said Silver Creek Mining and Railway Company. ;

      “Witness my hand and official seal this 4th day of January, A. d., 1878.
    “C. L. Latimer,
    [seal.] “Notary Public, Cuyahoga County, Ohio.”
    At the date of said instrument the said Silver Creek Mining and Railway Company held the said Whitman tract of 106 acres under a lease containing the following stipulation (said company being the party of the second part), to wit:
    “ It is also agreed that all coal mined on said premises is to be accurately weighed and the weights to be kept in a book which shall at all reasonable times be opened for inspection of the said first party, and it is further agreed that the said party of the second part is to have the privilege of using the said railroads, underground entries, buildings and fixtures for the purpose of mining and removing coal from other lands, and after the said mine becomes exhausted or unmineable they may coi tinue the use of said railroads, underground entries, buildings and fixtures by paying the party of the first part the sum of five dollars per year for each year they may us.e them for the purpose of transporting coal.”
    Before, and on, November 16,1872, the Wadsworth Coal Company owned the coal under other lands adjoining the tracts described in the agreement of that date ; but access to said adjoining tracts of coal could be conveniently had only through the lands described in said instrument.
    ' On May 21, 1879, the Silver Creek Mining and Railway Company began suit, in Medina common pleas, claiming that the Wadsworth Coal Company had forfeited its rights by non-fulfilment of its contract duties; that it owed a large amount as rental for coal; and prayed for an account, judgment for the sum due, and possession of the mines.
    The defendant by answer and eross-petition denied the alleged forfeiture; averred that all the coal in the lands described in the instrument of November 16,1872, had been mined and removed; that defendant was entitled to possess and use the passage way through the mines, and the struc tures and appliances ■ at the entrance, tor the purpose of removing coal from defendant’s adjoining land; and prayed the court to construe the contract and quiet defendant’s ■possession.
    The issues were referred 'to a referee who found that defendant had forfeited no right; that it owed to plaintiff $7,594.52; that all the minable coal had been removed from the plaintiff’s land; that no part of the contract, or instrument, of November 16, 1872, remained in force except the obligation to pay said balance and the right of the defendant to retain possession of said passage, structures and appliances for the purpose of removing said adjoining coal. The common pleas confirmed the referee’s report, and adjudged that plaintiff recover of defendant said sum of $7,594.52, and interest thereon from May 3, 1880. The costs were divided. A motion for a new trial was overruled, and a bill of exceptions presenting all the evidence was made part of the record.
    Upon petition in error the district court reversed and set aside “ all that part of the report of the referee and judgment of the court thereon, holding and deciding that said defendant in error has the right to hold and use said leased premises for the purpose of removing coal from other land, or for any purpose, after all the coal leased was found to be exhausted.”
    By petition in error the Wadsworth Coal Company asks for a reversal of the judgment of the district court.

      Humphrey Stuart, for plaintiff in error.

      Stevenson Burke, for defendant in error.
   Granger, C. J.

What is the- true-construction, of the agreement of November 16, 1872, upon the point in dispute? It-was formally and carefully drawn. The stipulations touching the- mining of the lessor’s coal, and • the payment therefor by the lessee, demonstrate’ that the draughtsman understood precision of statement and legal •phraseology, ; Fi'om.• the beginning, down to the last two 'clauses of the instrument, all is clear, precise and technical; giving rights and imposing obligations that were “ for the .term of till Coal is mined.” What coal? In the absence of any indication of a different meaning — the coal in the leased land. 'But-.note' the omission of u“the” before “coal.” .After'very completely providing for said rights and obligations the draughtsman added two clauses.

One of. these’ gives permission to-the lessee to remove all ¡.machinery and.fixtures “provided no unnecessary damage is-done to.;t'he 'land and fall accounts between the1 parties .hereto, are.. settled and-paid, and thus terminate this contract.” ’ ' 1’

If the preceding stipulations had, shown the work of a 5“.prentice’hand ” we would .attach less' importance to the ..words.if‘before the term of this agreement is expired the -coah shall be‘exhausted from said land.” But the words of -a skilled- and :careful writer demand attention.-. He began this clause with words plainly.indicating that “the term of ..this .agreement woyld 'not necessarily expire when “fhe -eoal'shoidd; be.'eyhafisted from, said .land.” , ; .. , . ■■ ,

! 'M hislsolb'F.uitpCseihad'béeú .ip insert permissiqn.for the ¿removal' byothe.'lessde’- of its, machinery and fixtures, such a (.writfer.'’WOjuld hay,e.;penned “on -the termination of this Je'ase,” or Nwhemall-the coal .shall be .exhausted from said land then the party of the second part, &c.” ' Moreover, after .the, words “ the coal'should be exhausted from said land,” he adds, “afid none remains to'be mined.” If these last six words refer to the coal in the leased lands the writer fell into a tautplogy-mot exhibited by- him' fin the preceding parts of the papery.-:.When he wrpt,e “‘'an.d none,remains to be mined,” was he thinking of the lessee’s coal in its adjoining tracts?;- Did.-the words; “.till Coal is mined ” include í/hzícóaj?’ ' '

In the filial clause he wrote, “ and it is also agreed that for any ¡coal that the party of the second part shall remove fro.m other, lands through, over, or-above said described land, the said second party shall have all the rights now possessed by the party of the first part.”

The defendant in error claims that this clause should be construed as if the words “during the continuance of this lease” were added to it.

But, if the writer’s intent was to grant a permit for that time, would he not have used the well-known phrase “ and during the term of this agreement said second party may remove coal from other lands through, over, or above said described land.” It is shorter by almost one half than the clause placed by him in the contract.

Moreover, the form of the contract clause clearly shows that the writer knew of the lessee’s purpose to so remove coal from other lands; nay, more, it recognizes its right to do so without the lessor’s permission, and implies a purpose to grant something in addition to such right. As matter of law, without any such permit, the lessee could lawfully remove coal from its other lands during the continuance of the lease. He who rents a farm adjoining his own, may, during the lease, haul the produce of his own land across the leased land without any license from his landlord.

This clause, in its form, recognizes this rule of law; recognizes the purpose of the lessee to so remove coal; and then proceeds to grant to it for the purpose of such removal, “ all the rights now possessed by the party of the first part.”

Among those rights was the grant in the Whitman lease, covering 106 acres out of the 175 acres described in the contract. The contracting parties acted with knowledge of that lease and its stipulations.

A well established rule requires the court to give effect to every word in an instrument if it can reasonably be done. In this case the common pleas treated the agreement as containing two distinct parts: the first a sale of the coal in the 175 acres with rights and obligations ending with the exhausting of that coal and payment for it at the stipulated' price; the second an assignment to the Wadsworth Company, for the purpose of removing the coal from its adjoining lands, of all the rights then possessed by the Silver Creek Mining and Railway Company. The Whitman lease valued those rights in the 106 acres of that tract at the small sum of five dollars per year. This fairly indicates what Whitman and the Silver Creek Company considered the concession of such rights was worth to the land owner in addition to the royalty paid for the coal in the land across.which, the rights were to be used. The Whitman lease was dated September 3, 1872, (less than three months before the agreement in question). Under it the Silver Creek Company was to pay a royalty of only seventeen cents per ton of 2240 pounds, and was bound to mine only about 1200 tons annually, making a rental of $200.

On November 16th, 1872, the Wadsworth Company took this lease and 69 acres more, and agreed to pay to the. Silver Creek Company a royalty of forty cents for each ton of 2150 pounds, and to mine at least 20,000 tons annually. It also .consented to most stringent stipulations as to time and manner of payments: it agreed to make “ advance ” payments and to so limit its right to apply those payments upon coal subsequently mined, that it was quite possible a material part of the payments so advanced would be wholly lost to it.

This assent to such terms, given with a knowledge of the moderate terms of the Whitman lease, plainly indicates, as we think, a controlling inducement more important than the mere right to mine coal in the 175 acres,, with the opportunity while so mining to take coal from their adjoining lands. The quantity to be taken each year from the 175 acres left, small time or opportunity for removing other coal “ during the lease.”

The district court adopted a construction which gives no effect to the opening words of the clause next preceding the final clause; which ignores the form of the final clause; which introduces into it words not there by necessary implication, to wif, “ during the continuance of this lease; ” and does not give to the Wadsworth Company “ all the rights” then “ possessed ” by the Silver Creek Company.

It seems to us that the. construction adopted by the common pleas is the true one. It gives to each word its ordinary meaning. The final clause expressly transfers to the Wads-worth Company all the rights then possessed by the other company for the purpose of removing coal from other, lands. No words of limitation are there. No court has a right to interpolate them without strong reason, unless they belong there by necessary implication. In this paper we find no such necessity. On the contrary, a careful, inspection of the paper itself, in the light afforded by the then situation of the parties as disclosed by the record, satisfies. us that they did not intend that any such words of limitation should be inserted, or implied.

The Silver Creek Company claims that if such is the true construction of the agreement, it is entitled to some $2,000 yearly as a rent. But it seems to us plain that, this rental is based upon the obligation to mine and remove coal, in and from the 175 acres; it is a royalty for coal so. actually mined and removed from said lands; or payable because of a failure by the Wadsworth Company to fulfil its covenant to mine the stipulated quantity. So soon as the minable coal in the 175 acres was exhausted that covenant ceased to operate; its obligation was fully performed. Hence no such rental is due to the Silver Creek Company. It does not suffer. It seems to us evident that it. prudently stipulated for, and, when the $7,594.52 shall have been collected, will have received ample compensation for all the rights granted.

The judgment of the district court is. reversed, and that of the common pleas affirmed.


author: McCauley, J.

text:
    Houk v. Condon.
    H. held a chattel mortgage from P. on a quantity of growing wheat. The mortgage was not filed with the clerk of the township where P. resided, S. and others, judgment creditors of P., caused executions to be levied upon the wheat, knowing that H. had a chattel mortgage thereon. The sheriff who held the wheat under his levies, after it was harvested and threshed, agreed with C. to sell it to him, to be paid for in cash on delivery; and afterward delivered it to C. in pursuance of his agreement. The sale by the sheriff was made with the consent and at the request of the execution creditors; but without an order from the court or a judge thereof to sell at private sale, and, on the day of delivery, before C. had paid for the wheat, H. seized it in replevin under a provision in his mortgage.

      Held: 1. That the lien created by the'levies was superior to the lien of the mortgage.
    2. That the delivery of the wheat to C. by the sheriff under his agreement to sell was not an abandonment of the levies.
    Error to the District Court of Pike County.
    On the 21st day of May, 1879, one H. 'C. Plyly, a resident of Twin township, in Ross county, gave to Houk, the plaintiff in error, a chattel mortgage on a crop of growing wheat on a farm in Jackson township in Pike county, to secure the sum of about $800. The mortgagee filed his mortgage with the clerk of Jackson township, Pike county, the township in which the wheat was. The defendant in error, on the 21st day of Ma3r, 1879, caused executions, issued upon judgments in their favor against Plyly, to be levied upon the growing wheat. The executions, by direction of the parties for whom they were issued, were returned by the sheriff after the levy to await the harvesting and threshing of the wheat before a sale should be made by the sheriff. After the levies, on •the 16th day of June, 1879, Houk, the mortgagee, filed his mortgage with the clerk of Twin township, Ross county, the township in which the mortgagor resided at the time the mortgage was given and when it was so filed. On the 23d day of June,* 1879, the execution creditors caused vendii to be issued to the sheriff, and he thereupon advertised the wheat for sale on the 12th day of July thereafter. On the 3d day of July, at the request of the execution creditors, the sheriff sold the wheat, about one thousand bushels, to the defendant Condon at private sale, for the full market price of wheat at the time and place of sale, to be paid for by Condon in cash on delivery, and thereupon delivered the wheat to Condon. The sale was so made by the sheriff without an order of court, or of a judge thereof to sell at private sale., and on the day it was so delivered to Condon and before he had paid for the wheat, Houk took it in replevin under a provision in his mortgage.
    When the execution creditors levied upon the wheat they had knowledge of the chattel mortgage from Plyly to Houk.

      John W. Washburn and Alfred Tapie, for plaintiff in error.'
    I. Did the levy of the executions give the sheriff and execution creditors a prior right to the mortgaged property over the mortgagee, Philip Houk?
    I. On the questions involved in this proposition the following cases are cited: Paine, Kendall f Co. et al. v. Mason et al., 7 Ohio St., 199; Minor v. Smith et al., 13 Id., 79; Pay v. Munson et al., 14 Id., 488 — see page 492; Murphy v. Swadener, 33 Id., 85 — see page 94.
    II. No title passed to Condon by the transactions of the sheriff and execution creditors; if any title passed it was encumbered with the mortgage of Houk, which was filed June 16th, and before the delivery to Condon of the wheat. Code, § 430; Rev. Stat., 5387.
    No private sale could be made except under the provisions of the above section. No notice was given Plyly. No order of the court was'obtained. No appraisement was ordered or had. The execution creditors took the law in their own hands without the intervention of a court or jury. Perry on Trusts, Yol. I., § 225, 2d ed.
    The sheriff, at the request of the execution creditors, undertook to sell at private sale, without the consent of the debtor Plyly, on an order of the court or a judge thereof so to do. There was an abandonment of the proceedings under the executions by the execution creditors and the sheriff as shown by the “agreed state of facts,” and the sheriff’s return relinquished the levies. The wheat was sold by an agreement between the execution creditors, thus turning the sheriff into a tradesman or merchant, and by proceedings which were wholly unknown to the law. Webb v. Anspaugh, Bro. ¿- Co., 3 Ohio St., 527.

      If the sheriff had collected the money for the wheat from Condon and not applied it on these executions, could he have been amerced ? Webb v. Ampaugh; Bro. Oo., 3 Ohio St.,. 523; Langdonv. Summers, Adm¡, 10Td;, 78.
    The levy was abandoned.
    A levy may be-abandoned .or vacated by the direct act of the plaintiff or of the officer executing the writ; or, indirectly by their not continuing the acts necessary to keep it in force. Freeman on'Ex., § 271.
    The.sheriff, when acting outside of the scope of his official authority and under, the direction of the execution creditors, cannot make a return upon his.writs — showing he still held the property- after it had been lost to him by his illegal act, coupled with the act of the execution creditors — which has any legal effect against, this plaintiff’s rights. If defendants have any rights in the property it is subject to plaintiff’s mortgage. Oarty v. Fenstemalcer, 14 Ohio St., 457; Morgan Oo. v. Spangler et al,, and Morgan $ Oo. v. Branson et al., 20 Id,, 38.
    . Wm. IL Safforep for defendant in error.
    The mortgage of plaintiff in error, at the time, of the levy, was- not filed with the clerk of the township in which the mortgagor resided. It was therefore absolutely void as against the execution, creditors. Rev. Stat., 4150-4151; Wilson v. Leslie, 20 Ohio,- 161 — 166; Kilbourn et al. v. Fox's Fx'rs,: 29 Ohio St., 278-; Hanes v.. Tiffany, 25 Id., 549.
    A mortgage must be recorded in strict- conformity with the statutory'requirements, in order to . be . of any validity against creditors, Herman on Chat. Mort., 162; McOlintio v. Platt, 22. Wis., ,561..
    The rights of subsequent creditors against, defective or unrecorded mortgages will be protected, .as well when the. claim under- such- instruments is asserted in a court of equity,- as in a court of- law.- Sixth. Ward-.B.uilding Ass. v. Willson, 41 Ind., 506.
    An actual notice to a creditor of an unrecorded .mortgage, of. the personal property of his debtor, does not-debar him, from taking such property by attachment or execution. Herman on Chattel Mortgages, 395; Farmers' L. I Oo. y. Hendrickson, 25 Bab., 484; Frost v. Beekman, 1 John. Ch., 288., 300; Work v. Harper, 24 Miss., 517.
    Did the assent of the execution creditors to the sale by the sheriff to Condon, at private sale, have the effect, in law, to release the levies ?
    It was done in good faith, and such agreement of sale was fairly made, for a higher price than the ruling market price, in favor of the judgment creditor, who alone could complain, and the proceeds were to be applied in satisfaction of the judgments.
    An execution is defined to be the end and the fruit of the law. In Ohio it becomes a lien on chattel property when levied. When levied, by virtue thereof, the goods levied upon, and the possession thereof, pass to the sheriff for the satisfaction of the debt. While in his hands he holds the property in trust for the benefit of the creditor. This lien can only be divested by a satisfaction of the judgment, or an abandonment of the property levied upon. Its only object is to realize the money from a sale of property. If this can be better effected by a private sale; if a higher price is obtained and no objection by the judgment debtor; if the sale was to his interest as well as the interest of the judgment creditors; if the sheriff in good faith strove to realize the largest amount for the property, for the benefit of all the parties in interest; if his only object in levying was to make the money to satisfy the executions, how can it be said, that‘by the sale of the wheat his levies were abandoned ? Langdon v. Summers, 10 Ohio St., 86.
   McCauley, J.

This case requires the determination of two questions: Did the levy of the executions create a lien on the wheat prior to the lien of the chattel mortgage of plaintiff in error ? And second, did the sheriff, by the sale of the wheat at private sale, lose or abandon his levy on it?

The wheat was levied upon on May 21st. At that time the mortgage to Houk was on file in the township in which the property was. The statute, section 4151, required the mortgage to be on. file' in the township in which the mortgagor resided. This section of the statute provides that unless the mortgage shall be filed in the township in which the mortgagor resides, it shall be void as against the creditors of the mortgagor, subsequent purchasers and mortgagees in good faith. Under this provision, the mortgage not being on file with the clerk of the township where the mortgagor resided, it was void as to creditors. It has been held in Paine et al. v. Mason, 7 Ohio St., 199, that a subsequent mortgagee taking a mortgage with .actual notice and knowledge of a prior mortgage is not a mortgagee in good faith; and this case has been followed in two or three other cases. But the rule applicable to a mortgagee in good faith, is not,applicable to a general creditor. A mortgagee, may give credit solely upon the faith of the mortgage security, which, if taken in good faith, is valid. The lien created by it arises from the acts of the parties, while the lien Of a levy arises by operation of law. No question of good faith has anything to do with it.

The levy, therefore, being prior to the filing of the.mortgage in the proper township to create a valid lien on the wheat, is superior to it.

As to the sale of the wheat by the sheriff, there is nothing in the acts of the sheriff to indicate an intention to abandon the levies. He agreed to sell the wheat at private sale for cash on delivery; and before he received payment, for the wheat, it was taken in replevin by Houk, the mortgagee. A levy will not be lost except by some positive act showing an intention or willingness to part with the control of the property levied on, or for a neglect to enforce it for so long- a time as to indicate that it .has been purposely’ abandoned. Nothing of this kind occurred in this ease. While the attempt to sell the wheat at private sale was’’ irregular, it does not indicate a purpose on the part of the ‘ sheriff, or of those for whom he was acting, to abandon theJ property 'as 'a means of satisfying -the claims under’ which' it was held. The contrary, however, appears. The sheriff sold the wheat at the request of the execution creditors, and for the purpose of paying their claims. The debtor, Plyly, the owner of the wheat, made no question that the sale was irregular. The mortgagee can get no advantage from the irregular sale, unless the irregularity went so far as to show a purpose to abandon the levy, or a degree of neglect to enforce it, inconsistent with a purpose to rely upon it, which, as already stated, does not appear.

Judgment affirmed.


author: Nash, J.

text:
    Monitor Furnace Co. et al. v. Isaac Peters et. al.
    In March, 1876, the Monitor Furnace Company, a corporation, was dissolved by a decree of the court of common pleas of Lawrence county, and J. P. S. was appointed and qualified as receiver, to administer the estate under the direction of the court, for the benefit of creditors and stockholders. Before that time the furnace company made a sale of its real estate and other property for the alleged purpose of defrauding its creditors. In August, 1878, the receiver having taken no steps to have the sale declared void, L. B., a judgment creditor, commenced an action for that purpose in the same court that dissolved the corporation and appointed a receiver. The corporation and its stockholders, the receiver, the creditors and all persons interested were made parties defendant. — Held: That this action was substantially an application to the court to direct the receiver appointed by it to do his duty in the case stated.
    Error to the District Court of Lawrence County.
    The Monitor Furnace Company was organized as a corporation in 1868. On April 18, 1875 (the company before that time having become insolvent), a majority of its board of directors by resolution determined to offer the real estate, leases and privileges belonging to the company, for sale at public auction on the- 20th day of May following, if not sold before that time at private sale. On that day the property was sold to the Lawrence Furnace Company for §45,000. Subsequently an action was commenced under the statute by stockholders for an order dissolving the corporation, the Monitor Furnace Company, and winding up its business, and on the 24th of March, 1876, this order was made and J. P. Shaw was duly appointed and qualified as receiver.
    At the May term, 1877, Isaac Peters recovered a judgment against the Monitor Furnace Company for $9,447.54. An execution was issued thereon in November, 1877, and levied upon the real estate formerly owned by the Monitor Furnace Company, and by it sold to the Lawrence Furnace Company.
    At the February term, 1877, Damarin & Co. obtained a judgment against the Monitor Furnace Company for $2,906.50, and upon this judgment an execution was issued and levied upon the same real estate on the 19th of January, 1878.
    No steps were taken by the receiver to set aside the sale of the real estate so made by the Monitor Furnace Company ; nor to recover the same or avail himself in any way of the property so disposed of.
    No order of the court was made or applied for, directing the receiver to institute any suit to recover the possession of the real estate, or make the same available for the benefit of the creditors. Nor was any application made to the receiver to institute any such suit, nor did he decline or refuse to commence such suit, or avail himself in any way he could, of the property referred to, as a fund for the benefit of the creditors of the company.
    Without application to the court for leave to commence suit to set aside the sale and recover the property, or permission to sue the receiver or make him a party to any suit touching the property of the Monitor Company, Isaac Peters commenced an action in his own name as a judgment creditor against the Monitor Gompany, the Lawrence Furnace Company, George N. Gray, as trustee of the Lawrence Company, Joseph P. Shaw, receiver, etc.; John T. Wilson as the mortgagee Of the Lawrence Furnace Company’s lands, including those bought from the Monitor Company, and the creditors and stockholders of the Monitor Furnace Company. This action was commenced in 1878, and was based upon the judgment recovered and lien claimed by virtue of the levy of the execution under the judgment upon the real estate so sold by the Monitor Company.
    On the 8th day of August, 1878, the plaintiff filed his amended petition, making in substance the following averments :
    1st. The plaintiff had recovered a judgment against Monitor Furnace Company, on liabilities of that company* which existed long prior to the pretended sale of its property, and the dissolution of the corporation.
    2d. That the officers and owners were, at the date of said pretended sale, in control of both the Lawrence and Monitor Furnace Companies.
    Bd. That said pretended sale was authorized by and for themselves, and the sale was to themselves.
    4th. That said pretended sale was without authority and without the consent of all the stockholders or directors thereof.
    5th. That said pretended sale was a fraud and made for the purpose of cheating and defrauding the plaintiff, and for the purpose of appropriating the said property to their exclusive benefit.
    6th. That no consideration was ever paid or agreed to be paid therefor.
    7th. That said pretended sale took from said corporation its entire property, and thereby destroyed it for all purposes for which it had been incorporated.
    8th. That said sale so made was illegal, null and void.
    Damarin & Co. filed their answer and cross-petition setting up their judgment, levy, etc., and making substantially the same averments as in the petition filed by Peters — touching the transfer of the property. And there was an additional averment to the effect that the receiver had “ neglected, and still neglects,” to prosecute an action to set aside the sale and subject the property to the payment of the debts of the Monitor Company.

      To the petition of Isaac Peters and the answer and cross-petition of Damarin & Co. answers were filed by John Peters, Sr., and by Gray as trustee of the Lawrence Furnace Company, in which it was claimed in substance that Isaac Peters, Damarin & Co., and other creditors who had filed cross-petitions, had no right to the relief sought, but that such right was vested exclusively in Shaw, the receiver. To these answers demurrers were filed and sustained by the common pleas court, at the March term, 1880.
    Thereupon the Lawrence Furnace Company and John Peters each asked leave to amend their answers, and also leave to answer the answer and cross-petition of Shaw, the receiver. This leave was not granted, the court finding that no sufficient showing had been made therefor.
    An appeal was taken to the district court. On the 20th day of April, 1881, a motion was filed asking leave to file answers for the Lawrence Furnace Company and the Monitor Furnace Company. This motion was overruled. The demurrers hereinbefore referred to were also heard and sustained by the district court. Thereupon the district court made the following order:
    “ It is therefore considered by the court that the sale and conveyance of said lands and premises, as in the plaintiff’s petition described, from said Monitor Furnace Company to said Lawrence Furnace Company be, and the same hereby is set aside and held for naught. And the sheriff of Lawrence county is directed and required to proceed and appraise, advertise and make sale of said real estate and premises, so sold and conveyed, as described in the plaintiff’s petition and amended petition, as upon execution at law, and the proceeds arising from such sale he bring into the court of common pleas of said Lawrence county to be paid over to the receiver of said Monitor Furnace Company, or to such other officer as that court may direct, to be applied in favor of the creditors of said Monitor Furnace Company under such order as to priority of liens and other rights of parties as may be determined by said court in this cause and in said cause now pending in said court relating to the dissolution of Monitor Furnace Company and the settlement of its affairs. And the said Joseph P. Shaw, as such receiver, is required to demand and receive from the said Lawrence Furnace Company and the said George N. Gray all rents received from said property, or for which they or either of them are chargeable since the date of said conveyance from said Monitor Furnace Company to said Lawrence Furnace Company, as aforesaid: and he is also directed and required to collect from the said Newcomb & Witman, and from any and all other persons, all rents due, or that may become due, on account of the possession or use of said real estate and property, not heretofore collected and received by said Lawrence Furnace Company and the said George N. Gray, as aforesaid : and the said Lawrence Furnace Company and the said George N. Gray and the said Newcomb & Witman, and any and all other parties owning or being chargeable for, or on account of rents received, or for which any of them may be chargeable on account of the use of said real estate since the date of said conveyance, are directed and required to pay the same to the said Shaw, as such receiver, forthwith.”

      O. F. Moore and R. Leete, for plaintiffs in error.
    Peters had no right to maintain his action. The title to all the property and effects of a dissolved corporation becomes vested in the receiver so appointed, so far as it or its beneficiaries can have title. It is all of its property and effects, wherever or however situated, in or out of the possession of the corporation, subject to its immediate control, or simply recoverable. His title and right in respect to the property is co-extensive with any right or title that the corporation, through its board of directors or officers, has, or any that any one, either creditor or stockholder, could, either in law or equity, assert. Being by force of the statute the trustee of both the corporation and all of the beneficiaries of the corporate fund, it would seem to follow incontestably, that the right to maintain an action, if any is necessary, in order to obtain the absolute control of any of the property or effects of the corporation, belonged to the receiver exclusively.
    Upon principle, then, we maintain that no one but the receiver, or at most, possibly, one expressly empowered and ordered by the court in the particular case, can maintain an action either for the purpose of subjecting the corporate property to the payment of the debts of the corporation, or of bringing it under the control of the receiver, so that it can be made available in his hands for that object.
    No one doubts the right of creditors to see that the property of the corporation is gathered up and made available ; and to see that it is properly distributed; but that right is one to be worked out in the case pending, and through the auxiliaries of the court in that case, and not by him in his own name and in an independent proceeding.
    The doctrine maintained is not only right upon principle and supported by reason, but is fully established by the authority of adjudicated cases. McDonald et al. v. Aten, 1 Ohio St., 298; Western B. B, Oo. v. Nolan, 48 N. Y., 517.
    The judgment recovered by Peters and Damarin & Co., and the levy of an éxecution upon the real estate, illegally or fraudulently, as alleged, transferred by the Monitor to the Lawrence Company, furnished no warrant or reason for the bringing of the suit; for while the judgments were valid, perhaps, the levies' after the dissolution of the corporation and the appointment and qualification of the receiver, were an absolute nullity.
    If the transfer were valid the property belonged to the Lawrence Furnace Company, and of course was not subject to levy; or if invalid or even voidable, the title to, or interest in, the property, whatever it was, was in the receiver by operation of law, and could not be levied upon. At all events, whatever there was in the property that belonged to the Monitor Company or that could be made available to its creditors or stockholders, was already,, by virtue of the suit pending, under the jurisdiction and cgntrol of the court, and was therefore not only not subject to levy, but any interference with it was in contempt of the court. Coe v. Columbus JR. JR. Co., 10 Ohio jSt., 403; Spinning §• Brown v. O. L. Ins. T. Co., 2 Disney, 336.

      Neal §• Cherrington, for defendants in error,
    claimed that Peters could maintain his action, and relied upon 2 S. & 0., 364, § 2; Id., 366, § 2; Revised Statutes, §§ 5680-5684.
    The plaintiffs claim that the care, custody and distribution of property is to be worked out through the receiver appointed, just as the business of a deceased person is settled * * * and are analogous in principle. The decisions in respect to the latter should apply by analogy to the former.
    This is a correct exposition of the law and does not leave the question undecided in this state, that a judgment creditor may maintain such a suit to recover property fraudulently conveyed away by the deceased. Sampson’s Adm’rs v. Summers et al., 18 Ohio, 444; McDonald v. Aten, 1 Ohio St., 293, 296, 297; Watson v. Clap’s heirs, 8 Ohio, 248.
    Iu Insurance Co. v. Jones, 35 Ohio St., 351, the receiver was there made a party and joined with the plaintiff in the relief asked. No objection seems to have .been here made to either Ms presence or position in this case.

      W. A. Sutchins, and W. S. Enochs, also for defendants in error.
    The general rule, no doubt, is that a receiver, as to Ms possession, cannot be disturbed by suit, without permission of the court appointing him. The possession of the receiver is the possession of the court, but that is not this ease. The object of this suit is to put the receiver in possession of property of which he never had possession. No attempt is being made to take funds or property from his hands, but to the contrary. This suit is to increase the property in his hands to be administered by him for the benefit of creditors of the insolvent. Why should any creditor complain of one of their number carrying on a suit at his own expense, for the equal benefit of all who join him in the suit ? It is not important what such vigilant creditor claims; the court determines what relief he is entitled to. The record here shows as soon as this property was recovered and under the control of the receiver, he was ordered by the court to sell it for the benefit of the trust.
    Independent of the statutes, the plaintiff has the right to maintain this suit, as brought by him. It is not important as to who is plaintiff or who is defendant, so that all parties interested are brought before the court, so as to be bound by the decree; and equity is in general satisfied, if parties are thus brought before the court either as plaintiffs or defendants. Remedies and Remedial Rights (Pomeroy), § 248, and cases there cited.
    As before stated, the law applicable to insolvent debtors is the law governing dissolved corporations. In the case of Haskins v. Aloot and Horton, 13 Ohio St., 210, this court decided that an assignment for the benefit of creditors, did not bar the creditors of the remedies formerly open to them for the collection of their debts. The bare appointment of a receiver does not of itself suspend or destroy the right of a judgment creditor, through an equity action, to recover estates and property fraudulently conveyed away; and the rights of judgment creditors are in no way affected or abridged thereby. Edwards on Receivers, in Equity, (2d ed.), 396; High on Receivers, § 318 and cases cited in note.
   Nash, J.

The plaintiffs in error claim — 1. That the courts below abused their discretion in refusing to permit the amended answers of the Lawrence Furnace Company and the Monitor Furnace Company to be filed. 2. That there was error in sustaining the demurrer to the answers of John Peters, Sr., and Gray, trustee.

It is sufficient reply to the first complaint to say that the answers sought to be filed by the Lawrence and Monitor Furnace Companies, did not constitute a defense to the case made by the petition and by the answers and cross-petitions.

In sustaining the demurrer, the district court held that Isaac Peters had the right to maintain this action and that this right did not rest exclusively in the receiver. It is the right and duty of the receiver of a dissolved and insolvent corporation, to pursue after and recover property which has been fraudulently conveyed before the dissolution. We do not, however, agree with the plaintiffs in error in their proposition that he is the only party who can do this.

In March, 1876, the Monitor Furnace Company, as a corporation, was dissolved, and Shaw was appointed its receiver to administer its estate under the direction of the court for the benefit of the creditors and stockholders. On the 20th day of May, 1875, it is claimed that the company sold and conveyed all its valuable property for the purpose of defrauding creditors. More than two years passed without any steps being taken by the receiver, looking towards the setting aside of this sale and the saving of this property for the benefit of creditors. In 1878, Isaac Peters, a judgment creditor of the Monitor Furnace Company, commenced a proceeding to set aside the alleged fraudulent sale and conveyance, and in the court having control and direction of the receiver. To this proceeding the receiver and all parties in interest were made parties defendant and were brought into court. In such an action as this, the court could make the proper order as effectively and justly as if it had been instituted by the receiver. The proceeding was in substance and effect an application to the court to direct the receiver to do his duty, and we think can be maintained.

We do not determine any question in regard to the priority of liens that has been or may be raised in these proceedings.

Judgment affirmed.


author: Dickman, J.

text:
    Jones v. Insurance Company.
    An insurance company made a loan of money to W., and took from him his promissory note for the amount thereof, with interest at eight per cent, per annum, secured by mortgage on real estate, and took Ills sundry other notes for usurious interest on the loan. W. afterwards sold and conveyed the property to B., who, as part of the consideration, agreed to pay the notes and mortgage given by W., and to secure the performance of his agreement, executed to W. a mortgage on the same property. B. sold and conveyed the property in fee to J., and made to him a warranty deed thereof, and agreed with him to pay off the incumbrances thereon.

      Held: That in an action of foreclosure by the insurance company, the defense of usury is not available to J. against the mortgage given by W. to the company.
    Ekrob. to the District Court of Licking County.

      Charles H. Killer, for plaintiff in error.
    Jones bad in no way, verbally or by written covenant, agreed to pay this mortgage. He paid full consideration for the property, and besides, Birkey agreed to pay off and cancel all incumbrances upon the property, and did pay one of them. Jones was not, therefore, personally liable for the debt, as he would have been if he had received the ■conveyance with an assumption in it to pay this mortgage ■as part of the purchase money. Brewer v.' Maurer, 38 ■Ohio St., 543.
    It is said that the defense of usury is personal to the mortgagor, and cannot be set up by his grantee, and the case of Cramer v. Lepper, 26 Ohio St., 59, is quoted as authority. But that doctrine is not in the syllabus, and though so stated in the decision, was evidently a mistake, and was intended to apply only to the case there made, which was a case where the grantee had assumed, in consideration of the •grant, to pay the claim of the mortgagee. The case of Union Bank v. Bell, 14 Ohio St., 200, cited in Cramer v. Lepper, holds the very opposite doctrine, except where the grantee is the grantee of the equity of redemption, eo nomine.

    The doctrine that usury cannot be set up by the grantee is against the weight of authority. 1 Jones on Mortgages, Sects. 644, 746, 747, and authorities cited. 2 Jones on Mortgages, Sect. 1494; Silienthal v. Champion, 56 Georgia, 188.

      A person who has paid full price for the land can set up usury. Mahler v. Lanfrom, 86 111., 513.

      J. Buckingham, for defendant in error.
    It is well settled in Ohio that Birkey by agreeing to pay "Wallace’s notes to the Insurance Company, cannot question their validity on any ground, and that the Insurance Company may have the benefit of the promise and maintain suit upon it. Cramer v. Lepper, 26 Ohio St., 59; Brewer v. Maurer, 38 Id., 543; Union Bank v. Bell, 14 Id., 201.
    Can Jones set up the usury? We say no.
    1. The promise by Birkey to pay the notes and mortgage as part of the purchase money for the property, made Birkey the principal debtor as between him and Wallace, and what is more important, made the property the primary fund out of which the debt should be paid; it was in equity set apart for this purpose. 1 Jones Mortg., 2d ed., sec. 737, 740.
    2. Jones had notice of that equity: first, constructive notice by reason of the clause of assumption contained in the deed of Wallace to Birkey under which directly Jones holds his title; second, actual notice because he says that when he bought, Birkey agreed with him to pay that lien.
    The equity arising in favor of Wallace is an equity in the land and affects the title in the hands of Birkey and of his assigns with notice, and what appears plainly in the deeds under which a man holds title is notice, to him. Wade on Notice, sec. 307-309; McChesney v. Wainivright, 5 Ohio, 452; Scott v. Douglass, 7 Ohio, pt. 1, 227.
    Wallace devoted the property to the payment of this debt just in the manner he had himself agreed to pay it; he left a fund in the hands of Birkey and he had a right to say what should be done with the fund. By accepting the fund as he did upon the trust fixed upon it by Wallace, and the trust being one not prohibited by law, Birkey was bound to perform it. Jones having obtained possession of the fund with notice of the trust, must also perform it.
    The fund left by Wallace in the hands of Birkey was purchase money unpaid, and was not due when Birkey sold to Jones, of which Jones had notice, and the lien could therefore be enforced as a vendor’s lien against both Birkey and Jones. Freeman v. Auld, 44 N. Y., 56; see Sweetzer v. Jones, 85 Vt., 317; Hartley v. Harrison, 24 N. Y., 170.
   Dickman, J.

On the 1st of July, 1871, George Wallace, at Newark, Ohio, made to the Franklin Insurance Company —defendant in error — a mortgage of land situated in Licking county, to secure the payment of a note given by him to that company for $10,000, payable five years after date, with interest at eight per cent, per annum payable quarterly, and nineteen other notes of fifty dollars each. The largest note was given for money loaned to Wallace, for which he agreed to pay ten per cent, interest. Fifty dollars — being two per cent, interest for the first quarter — were retained as advance interest, at the time of the loan, and the sum of $9,950, only, was paid to Wallace. The nineteen separate potes, of fifty dollars each, were taken for each quarter’s two per cent, extra interest thereafter during the five years, over and above the stipulated eight per cent.

On the 3d of September, 1873, Wallace sold and conveyed the property in fee to James L. Birkey, who, in consideration thereof, and as a part of the purchase money, assumed and agreed with Wallace to pay the mortgage, and the note for $10,000, with interest thereon according to the tenor thereof, and thirteen of the interest notes for fifty dollars each, then unpaid, which Wallace had made to the insurance company. Birkey, to secure the performance of his agreement with Wallace, executed to him on the same day a mortgage, duly recorded, on the same property. In September, 1874, Birkey sold and conveyed the property by deed of warranty to the plaintiff in error, John B. Jones, and upon delivery of the deed, agreed with Jones to pay off and cancel all the incumbrances upon the premises.

The insurance company brought its action of foreclosure, making Wallace, Birkey, Jones and others parties defendant, asking for no personal judgment, but asking judgment that the property might be sold free from all liens and claims of the parties to the action, for the satisfaction of the money due the company.

In the court of common pleas, Jones set up the defense of usury against the mortgage held by the company, and claimed, that the company could recover only $9,950, the amount actually loaned, with six per cent, interest thereon, less the payments admitted to have been made, with interest on the same. Upon issue joined, the court rendered judgment for the plaintiff, and Jones took an appeal to the district court.

The district court, in determining the amount due the company, adopted $10,000, instead of $9,950, as the principal sum, and computed interest thereon at the rate of eight per cent, per annum; and allowed in the estimate the thirteen interest notes which had been paid by Birkey pursuant to his agreement with Wallace; and held, that the property in the hands of Jones, conveyed to him by Birkey, was bound for the payment of the amount found due the company. Judgment was rendered for the company; Jones excepted; moved for a new trial; and the motion being overruled, took a bill of exceptions; and the present petition in error is prosecuted to reverse the judgment of the district court.

The only question arising out of the record, which we deem it material to consider, is, whether the defense of usury is available to the plaintiff in error, against the mortgage made by Wallace to the defendant in error. It is obvious, that after the agreement between Wallace and his grantee, the latter could not defend against the mortgage on the ground of usury. Such defense was, in this case, personal to Wallace, the mortgagor and borrower. If he did not choose to avail himself of it, he was privileged to waive it. He elected to affirm the usurious mortgage, by making provision, when he sold the property, for paying out of the purchase money fund the mortgage debt and the several notes for usurious interest. His grantee, as part of the purchase money, assumed and promised to pay the mortgage debt and interest notes, and to secure tbe performance of his promise, executed to him — Wallace—a mortgage on the same property. Birkey, the grantee, was not thus in a position to defend on the ground of usury, against the mortgage held by the company. Cramer v. Lepper, 26 Ohio St., 59, and cases there cited. Loomis v. Eaton, 82 Conn., 550; Austin v. Chittenden, 33 Vt., 553; Studabaker v. Marquardt, 55 Ind., 341; Cook v. Dyer, 3 Ala., 643; Baskins v. Calhoun, 45 Id., 582.

And, if Birkey was barred from taking advantage of the defense of usury, at the time of his selling and conveying the property, such defense should not be more available to the plaintiff in error than to his grantor. The plaintiff in error was not a party to the usurious transaction ; nor, does he stand in such a relation to the borrower as would authorize him to make such defense, notwithstanding the borrower’s waiver of it. With full notice of the mortgage held by the defendant in error, and of his grantor’s agreement with Wallace to pay the mortgage and interest notes, he purchased the property at an agreed price and value ; and, if his grantor failed to pay off the incumbrances thereon, according to his promise, he must have recourse to him for redress. But, a failure to discharge such incumbrances does not warrant the taking of the usurious interest from the defendant in error, and placing it to the credit of one who is virtually a stranger to the usurious transaction.

No error in the proceedings and judgment of the district court being apparent on the record, the judgment of that court must be affirmed.

Judgment accordingly.


text:
    State of Ohio v. Mook.
    Where an indictment charged the embezzlement of numerous articles of property and alleged an aggregate value thereof, it was competent for the state to prove the embezzlement of any one or more of the articles of property charged, and the value of the same, although the value of each article of property was not separately stated in the indictment.
    Exceptions by the Prosecuting Attorney to the Court of Common Pleas of Sandusky County.
    The defendant in error, Mook, was indicted at the October term, 1880, of the common pleas of Sandusky county for embezzlement. The case was tried at the January term, 1881. The indictment charged the embezzlement of numerous articles of dry goods, dress goods, clothing, shoes, millinery goods and notions. There were about two hundred and fifty articles of property alleged to have been embezzled, and the value of the property was alleged in an aggregate sum, thus: “All of the value of one thousand three hundred and eighteen dollars and fifty-six cents.”
    The testimony on the part of the state tended to prove the embezzlement of all the property described in the indictment except about eleven articles. The prosecuting attorney asked a witness to state the value of all the goods described in the indictment, excepting the eleven articles not identified. Objection was made and sustained. The prosecuting attorney then offered to prove the value of the several articles of property described in the indictment, separately, excepting the eleven articles not identified. To this objection was made and sustained. To the opinion of the court sustaining said objections severally, the prosecuting attorney excepted.

      John M. Lemmon, for plaintiff in error,
    cited 17 Ohio St., 294; 2 Bishop’s Cr. Pro., §§ 713, 717, 764, 769; State v. Buck, 46 Me., 531; Qom. v. Duffy, 11 Cush., 145-6; Meyer v. State, 4 Tex. App., 121; 0one v. Grrimes, 10 Gray, 470; Murphy's Case, 8 Blackf., 498; State v. Mart, 29 la., 268; Brown v. State, 44 Ga., 300.

      J. B. Bartlett and T. P. Finefroek, for defendant in error,
    cited Barber Or. L., 180; 2 Hale, 182-3; Russ. & Ry. C. C., 274; 1 Chitty Cr. L., 238; 1 Wharton, 381, 384, 727; Com. v. Cahill, 12 Allen, 540; Hope v. Com., 9 Met., 134; State v. Hood, 51 Me., 363; Armstrong v. State, 21 Ohio St., 357; Hex v. Forsythe, 1 B. C. Ca. (Russ. & Ry.), 273; 8 Black-ford, 498.
   McCauley, J.

The court below excluded the testimony offered to prove the aggregate value of the property stated in the indictment, because the proof failed to show that every article of the property was embezzled. And proof of the value of the articles of property separately, was excluded because the value of each article of property was not alleged. Section 7215 of the Revised Statutes provides: “ That no indictment shall be deemed invalid, nor shall the trial, judgment or other proceeding be stayed, arrested or in any manner affected * * * when there is sufficient matter alleged to indicate the crime and person charged * * * nor for any other defect or imperfection which does not tend to the prejudice of the substantial rights of the defendant upon the merits.” The plea of not guilty put in issue the fact of embezzlement of each article charged. And the value of the property charged, being stated in- the indictment, the plea put the value in issue also. It was enough that value was alleged in any way. It could be proved in the aggregate or by proving the value of each article separately. Proof of separate value is the same as proof of aggregate value; one is only the particulars of which the other is made up.

The question before the jury was, what articles of the property charged had the defendant embezzled, if any, and what was the value of these articles. Unless it could be shown that to allege the value in the aggregate would prevent the defendant from contesting the value of each article charged, or would restrict his right to offer testimony in his defense, or could make his defense more difficult or uncertain than to allege and prove it separately, the distinction between the two forms of the indictment is one in words only and not in substance. The statute requires the substance to be regarded and not the form.

We are aware that precedents can be found for the shadowy distinction taken by the court below. There really never was any better reason for them than there is now under our statute. They have frequently and perhaps generally arisen from too strict an application or a misapplication of the rule which constrains courts, in cases of doubt, or possible doubt, to err in favor of life or liberty.

Exceptions sustained.