Sweetzer versus Atterbury

Supreme Court of Pennsylvania1882-10-02

100 Pa. 18

Summary · law.co

Holding. The court affirmed the judgment, holding that the defendant, who purchased the mortgage in good faith without notice of the alleged secret arrangement and took the property at a regularly conducted sheriff's sale, holds title discharged of all equities of which she had no notice.

This ejectment action concerned land sold at a sheriff's sale following a mortgage judgment. The original owner sought to invalidate the judgment and defeat the title acquired at the sale by presenting evidence of a secret arrangement in which the land had been transferred to intermediaries as nominal mortgagees. The court found the offered evidence insufficient to accomplish this purpose and held that it was properly rejected at trial.

The court emphasized that the intermediaries held title that appeared valid on its face, which entitled them to execute a binding mortgage. A subsequent lender who received the mortgage relied on this regular title without notice of any hidden arrangement and thus took the mortgage free of any equities. When that lender assigned the mortgage to the defendant, the assignee similarly purchased in good faith with no constructive notice of the alleged secret understanding. Under established law, a mortgage assignee takes the instrument discharged of equities held by persons not party to it when the assignee has no notice of those equities.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

Whether evidence of a secret trust arrangement between original owner and intermediary mortgagees could defeat title acquired at sheriff's sale
Whether a good-faith purchaser of a mortgage takes it free of equities when lacking notice of hidden arrangements
Standards for admissibility of evidence offered to prove alleged collusion and payment of mortgage

Procedural posture

An ejectment action was brought to recover land purchased at sheriff's sale, with the original owner challenging the validity of the underlying judgment and mortgage.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion · public domain

majority opinion

Mr. Justice Merour

delivered the opinion of the Court, October 2d 1882.

This action of ejectment is to recover land purchased by the defendants in error, at sheriff’s sale under a judgment obtained on a mortgage. The plaintiff in error seeks to attack the validity of the judgment, and thereby defeat the title acquired at the sheriff’s sale. We think all the evidence offered insufficient for that purpose, and therefore rightly rejected.

It is not sufficient that the plaintiff in error was once the owner of the land, and caused the title thereto to be transferred to the Jifkins, whereby under a secret arrangement the latter held as mortgagees. They held the land by a title regular on its face, which to the eye of the world gave full power to execute a valid mortgage on the land. In fact it was conve,yed to them for that purpose: Sweetzer’s Appeal, 21 P. F. Smith 264. Relying on a title regular on its face, and without notice of any trust or equity affecting its force and effect, Dodge loaned the money to them and took the mortgage in question. The reference in the offer to the agency of Scranton in the transaction, is too vague and indefinite to affect Dodge with notice of the alleged arrangement between the plaintiff in error and the Jifkins. If, however, it was otherwise as to Dodge, there is no offer to prove that the defendant in error had any notice when she purchased the mortgage and took the assignment thereof. She purchased in good faith and the assignment to her was duly recorded. The assignee of a mortgage takes it discharged of the equities of persons not parties to it, of which he has no notice: Mott v. Clark, 9 Barr 399; Pryor v. Wood, 7 Casey 142.

The portion of the offer contained in the second specification that the mortgage was paid in full as between the plaintiff in error and the mortgagors, was properly rejected. No payment between them could satisfy the claim of the mortgagee. The further offer was clearly inadmissible to show that, as between the Jifkins and the defendants in error, “there have been such transactions and such evidences of collusion as warrants the deduction or inference that it was paid also to them.” The offer gives no information in regard to what facts are proposed to be proved from which the alleged deduction or inference may be drawn. An offer of evidence should aver with reasonable distinctness and certainty the facts sought to be proved; without this, we are not able to say that the rejection of the offer caused any injury.

The fourth specification is also in disregard of our rules. The offer was to prove “ by the report of the master,” that the amount of the mortgage ivas paid prior to the scire facias thereon. “The report of the master” is not set forth. It is not shown, so that we can say whether it would prove the fact alleged. "Whenever error is alleged to the rejection of records or instruments of writing, a copy thereof should be furnished in order to enable us to determine as to its relevance and sufficiency.

We fail to see that the plaintiff in error was unduly prejudiced by the admission in evidence of the record referred to in the first specification.

The defendant in error in good faith purchased under proceedings on a judgment regular on its face. She took and holds discharged of all the alleged equities of which she had no notice. She does not need to show the proceedings on the rule taken by the plaintiff in error, to maintain her title. We discover no ground for reversal.

Judgment affirmed.