Tallman v. Farley

Edmonds, J.

The judgment creditors comé into tins court to enforce the legal lien of their several judgments, and they claim that they are entitled to be first -paid, because they are prior in point of time to the mortgages. It is not pretended that those creditors have made any advances, or incurred any liabilities, on the strength of the mortgaged premises; or that any agreement has ever been made between them and Farley, by which they were to have a specific lien on them. But they claim under the legal right growing out of the general lien of their judgments.

These judgment creditors are not in equity regarded as bona fide purchasers, and entitled to the consideration which equity gives them, when they become such without notice, for a valuable consideration actually paid; but they are looked upon simply as proceeding in invitum, to enforce their legal demands, and are not entitled to the same favor as a purchaser, whose right may be enforced through the conscience of the other party. (2 Story’s Eq. 1502. Langton v. Horton, 1 Hare, 547. Skeeles v. Shearly, 3 Myl. & Cr. 112. Story’s Eq. Pl. § 807, a.) Mortgagees however, who have advanced money on the credit of the land, are considered as bona fide purchasers. (In Re Howe, 1 Paige, 128.) Judgment creditors are entitled only to such rights in the premises as the judgment debtor rightfully possessed. (2 Story’s Eq. § 1503, b. Whitworth v. Gaugain, 3 Hare's R. 416.) They can take all that belonged to the debtor, and nothing more. (Langton v. Horton, 1 Hare’s R. 547. Kiersted v. Avery, 4 Paige, 15. Morris v. Mowatt, 2 Id. 590.) This principle is well established in equity jurisprudence. It is of frequent application in cases of trusts, and is entirely decisive of this case. For it cannot be pretended that the judgment debtor ever had any right to the premises, independent of the equitable rights of the second mortgagees. His title was taken in subordination to their claim, and the very value, out of which the surplus in question flowed, was produced solely by the money thus advanced to him. If the judgment creditors could find a moment of time in which their debtor had a right to sell or incumber the premises, in preference to the claim of the second mortgagees, they might perhaps find some aliment on which their legal claim might be fed. But no such time can be found: and as their debtor never had a right to alienate or incumber the premises to the exclusion of the second mortgagees, and as these judgment creditors can take only such right as their debtor had, they have no right in equity to the preference they .now set up.

The master’s report must be confirmed, with costs to be taxed.