Lake v. Shumate

Citations

• 20 S.C. 23
• 1883 S.C. LEXIS 123

Syllabus

<p>1. L. purchased at public sale a tract of land for M., paid the greater part of the purchase-money, and took titles in his own name, M. giving to L. a note for such his payment, and himself paying the balance, under a verbal agreement that L. should convey to M. when this note was paid. Subsequently M., being in possession, mortgaged this land to D., which mortgage was duly recorded. L. died and his widow became sole owner of the legal title to the land, and also of M.’s note to her husband, and afterwards, regarding such title as her security, she made a loan to M. of money belonging to a ward of whom she was guardian. Some years later, M. gave to this widow a new note for the balance due to her upon his two notes so held by her, she never having had actual notice of the mortgage to D. In action by the widow to have D.’s mortgage canceled and for other relief, this land was sold. Held, that D.’s mortgage was not entitled to receive any part of the proceeds of sale until after full payment to L.’s widow of the moneys due to her on M.’s consolidated note.</p> <p>2. The fact that the money lent by the widow belonged to her as guardian, while the original debt was due to her individually, does not affect her rights in the matter.</p> <p>3. In a contest between M. and L., M. could not demand titles without paying all of his indebtedness to L.; and D., under his mortgage of M.’s interest in the land, can claim only such interest — and that is, what remains after paying to the heir of L. the balance of the purchase-money and all other debts due to her by M.</p> <p>4. If actual notice of the mortgage to D. was had before other money was lent to M. by L. or his widow, the mortgage would be preferred to such subsequent loans, but neither possession of the premises by M., nor the record of the mortgage, were sufficient to charge the holder of the legal title with notice.</p> <p>5. Costs in such a case are within the discretion of the Circuit judge.</p>