Radcliff v. Rowley

The Chancellor.

If the bill intended to charge, in this case, that nothing was due upon , the mortgage at the time of the sale under the statute foreclosure, and that charge was true, the sale was a nullity; and the ancestor of the complainant had a perfect defence at law to an action to turn him out of possession. And after such a lapse of time it is too late to seek relief in any court. If any thing was due upon the mortgage, the foreclosure was regularly made, and cannot be disturbed upon the ground that the appellant represented to the bidders that he was about to bid it in for the benefit of the mortgagee ; which representation, as I infer from the bill, was true at the time it was made. If so, there was no fraud in the purchase ; but the fraud, if any, was a subsequent fraud, upon Van Benthuysen, in withholding the property from him. For the foreclosure being regular, and no false representation having been made to prevent competition, Yan Benthuysen was entitled to the mortgaged premises at the price for which they were struck off to his agent or trustee.

This part of the bill, however, may be material for another purpose, and I presume that was the object for which these charges were inserted in the bill. The appellant subsequently caused the other half of the lot, which had been conveyed to Radcliff with warranty, to be sold under the executions against Yan Benthuysen, whose property was primarily liable for the payment of the judgments. And if Yan Benthuysen was then the beneficial owner of the mortgaged premises, under the statute foreclosure, those premises should have been first sold under the executions. Rowley, who knew the fact, was guilty of great injustice in causing the other half of the lot, which was only secondarily liable, to be sold first and to be bid in for his benefit; even if the judgments belonged to himself, and had been purchased on his own account and paid for with his own funds. But if, as the bill charges, the judgments had been paid for with the funds of the judgment debtor, in the hands of Rowley as his agent, then the judgments, though nominally assigned to him, were in fact paid and satisfied. And causing the lands of Radcliff to be sold upon the executions issued on those judgments, under the circumstances stated in this bill, either with or without the consent of Yan Benthuysen, was a gross and palpable fraud; against which a court of chancery ought to relieve the complainants, if their remedy is not barred by lapse of time. It is therefore unnecessary, for the present, to consider what new rights, if any, Radcliff acquired under the decree of May, 1834, in a suit to which he was not a party; or under the conveyance to Yan Benthuysen in pursuance of that decree, and of the order of the 8th of January, 1839.

If the allegations in this bill are true, I am inclined to think Rowley did not obtain the legal title to the premises in question by virtue of the sheriff’s sale. If so, the complainants, who are in possession, can successfully defend themselves in any suit at law which may be brought against them to disturb that possession, even as ¿gainst the mortgagees of Rowley, or against a purchaser under the decree in his favor against Yan Benthuysen. But upon that question I do not intend to express a definitive opinion at this time. For if they had a good defence at law, they had also a right to come into equity for relief, to remove the cloud upon their title, caused by the alleged fraud of the appellant. The judgments and executions' and the sale by the sheriff give "ail apparent légal title to the purchaser, and to those who are claiming under him as subsequent mortgagees, which apparent title can only be displaced by the evidence of witnesses; and that evidence may soon be lost by lapse of time. It is therefore a proper case to come to a court of equity with, for the purpose of obtaining a decree to quiet their title to the premises, and to remove this cloud therefrom. (See Pettit v. Shepherd, 5 Paige, 501, and the cases there referred to.)

Is the complainant’s claim to relief then barred by lapse of time 1 This, it will be seen, was not a case of concurrent jurisdiction, in which the right to relief in this court would be barred in analogy to the time allowed for bringing a suit at law. For Radcliff being in possession, at the expiration of the fifteen months after the sheriff’s sale, he could not institute a suit at law to try this question of fraud. His only remedy at that time was to file a bill in equity to set aside the sheriff’s sale, and thus to remove this cloud, which the appellant’s fraud has cast upon his title. One claim to relief is. founded upon the alleged fraud, in obtaining an apparently good paper title to the ptemises in question, under the forms of law, after Rowley knew.the judgments .had.been paid with the funds of the judgr ment debtor. It is a case, therefore, so far as the complainants seek relief by removing that cloud from their title., in .which, the suit must be brought in this court within six years, after the discovery, by, the aggrieved party, of the facts, constituting the substance of the alleged,frg.ud. (2 R. S. 301, § 51.) But it does not appear, on. the. face of this bill, when W. Radcliff discovered the. alleged fraud, or that he ever did discover the. fact, now stated, by his heirs, that the judgments had been paid by Rowley, as the. agent- of the judgment debtor, with funds in,his hands belonging to the latter, before. the sheriff’s sale.. The bill shows that .Radcliff knew, of the sheriff ’s sale within.a year or two after it occurred, and-that he. discovered something, or supposed he had, which induced .him to file a bill in", this court against Rowley and. Van Benthuysen jointly. But it does not appear chat it was for the same fraud no.w complained of. And I think upon a. proper construction of the statute, it is not necessary that the complainant should allege in his bill that he has discovered the. fraud, complained of, within six years. A demurrer, therefore, will not lie, to a bill-for relief on the ground of fraud, although it appears that the fraud occurred .more than six years before the commencement, of the. suit; unless it also appears positively, or by necessary intendment, that the fraud was discovered, by the party aggrieved,, more than six years before he filed his bill for relief. Where that does not appear, the defendant must be left to make his defence by plea or answer, so as to present an affirmative issue, upon.the question of the discovery of the fraud..

This is sufficient to dispose of .thismase, upon a general der. murrer to the whole , bill. It, is not necessary, therefore, to. examine the question whether there are not some grounds, for relief, of a recent date, stated in this .bill, which could, not have, been barred,, under any provision of the article of the revised stat ufes relative to the. time of commencing suits in courts, of equity. Nor is it necess.ary to inquire whether some- of the grounds of relief,.-stated.in this bill, do not appear upon the.face of the. bill to be barred by lapse of time. If that question is sought to be raised, on demurrer, it must be done by a separate demurrer to those particular parts of the Mil

The decretad order appealed from must be affirmed with costs.