November 5, 1914. The opinion of the court was delivered by This action was commenced by the respondents as coplaintiffs to foreclose a mortgage for *Page 137 $15,000.00, securing a note for that amount executed and delivered on May 4th, 1906, by the Southern Granite Company to T.J. Strait covering one thousand and ninety-three acres of land, on the line of Kershaw and Lancaster counties, whereon the Granite Company operated its rock quarry. The mortgage was recorded in both counties, in September, 1906. On May 5th, 1906, the said Strait made a thirty day promissory note to the Charlotte National Bank for three thousand ($3,000) dollars, and assigned as security for the same the aforesaid $15,000, given him by the Granite Company. This note with the collateral mortgage on November 11, 1910, was transferred by the Charlotte National Bank to the Farmers Bank and Trust Company, which as holder of this note joined with Strait to foreclose said mortgage. After issue was joined the cause was referred to Paul Moore, Esq., as special referee, to hear and determine all issues of law and fact. The said referee made his report in favor of the plaintiffs.
Exceptions were duly taken to this report by the Charlotte Trust Co. and Southern Granite Co., and these exceptions were heard by his Honor, Judge Sease, who overruled these exceptions and sustained the report of the referee. From this decree of his Honor, Judge Sease, the appellants appeal. The reports of the special referee and the decree of his Honor should be set out in the report of the case, for a proper understanding of the same.
The first exception is: "For that his Honor erred in holding that the execution and subscription of the mortgage bonds of the Granite Company by T.J. Strait, as secretary of said company, which bonds proffered on their face to be secured by first and second mortgages, did not operate as an estoppel upon said Strait individually, so as to preclude him from asserting the priority of his mortgage; whereas, his Honor should have held that the said Strait, by participating and co-operating with the stockholders and directors in the proceedings of said company *Page 138 leading up to and resulting in issuance of said mortgage bonds, and in subscribing the execution of same, and in placing them before the public, is in equity by such conduct estopped from asserting as prior the mortgage of the company held by him."
This exception cannot be sustained. The mortgage of Strait was on record in the proper offices, both in Kershaw and Lancaster counties, and the purchasers of these bonds, issued by the exercise of the slightest care, could have ascertained that this mortgage, given for purchase money, was open and unsatisfied. The mere keeping silent in regard to it on the part of Strait cannot operate so as to bind an estoppel against him. It was incumbent on the purchasers of the bonds, or those intending to make loans on mortgages, to examine the title and make an inspection of the record and the presumption is that this was done. Mills v. Graves, 87 Am. Dec. 317; Brinckerhoff v. Lansing, 8 Am. Dec. 538.
The alleged misrepresentation consists solely in the bond-headings, "first mortgage bonds" and "second mortgage bonds," such words are mere general recitals by way of nomenclature of the bond issues of the company. Nowhere in the bonds are there any affirmations or statement that there is no other mortgage on the property in question and that no prior mortgage existed in favor of Strait. It is a characterization that the bonds are a certain issue designated "first" and "second," issued by the company and secured by mortgage. There is nowhere in the body of the bond any affirmation that it is the first mortgage or lien on the property in question and a general recital does not furnish a basis for estoppel. Bigelow on Estoppel, 302.
The mere fact that Strait signed the bonds in his official capacity as secretary of the Southern Granite Company in pursuance of a resolution of the stockholders of the company, is not such a voluntary act on his part as would estop him from asserting his individual claim, as his mortgage was on record notice to the whole world, and there is no *Page 139 evidence that the holders of any of the bonds claim that they relied on any statement, representation, or act of Strait that would estop him other than the mere general recital in the bonds nomenclature of "first" and "second" mortgage. There is no evidence that they examined the records, and no evidence that they took the trouble to ascertain whether the T.J. Strait, who held the mortgage on record in two counties, was the same T.J. Strait who signed the bonds as secretary of the Southern Granite Company. Strait signing the bonds in question under the circumstances he did was an official and not an individual act, and it was not necessary, and in fact he could not, by any authority or power, put in any statement of his individual rights in the premises in any instrument signed by him in the discharge of an official duty, and under the direction of the stockholders so as to operate as an estoppel upon him. Bigelow on Estoppel (3d Ed.) 275; Wright v. DeGraff, 14 Mich. 164.
The second exception assigns error on the part of the Circuit Judge in holding that the burden was upon the appellants of showing affirmatively that they had been misled to their injury. The referee and Circuit Judge both concluded that the doctrine of estoppel can be invoked by the party setting it up showing that he had been misled to his injury. This conclusion of the referee and Circuit Judge is fully supported by the following authority: Bigelow on Estoppel, 3d Ed. 434; Bethune v.McDonald, 35 S.C. 93; Gaston v. Brandenburg, 42 S.C. 348;Scarborough v. Woodley, 81 S.C. 329; and for this and the reasons in overruling exception one this exception is overruled.
The third exception is overruled for the reason that this was a matter purely within the discretion of the Court, and we see no abuse of discretion on the part of his Honor.
The fourth, fifth and sixth exceptions are overruled for the reason that no exceptions were made to his Honor's *Page 140 finding of facts and we see nothing erroneous in his conclusions of law as to these matters. The referee and Circuit Judge concurred in their findings of facts by the preponderance of the evidence that his Honor, the presiding Judge, erred in his findings of fact, and this they have failed to do. Lumber Co. v. Stallings, 91 S.C. 476:Leland v. Morrison, 92 S.C. 470.
Judgment affirmed.
THE CHIEF JUSTICE concurs.
MESSRS. JUSTICES HYDRICK and FRASER concur in theresult.