Benham v Keane
| Jurisdiction | England & Wales |
| Judgment Date | 25 November 1861 |
| Date | 25 November 1861 |
| Court | High Court of Chancery |
English Reports Citation: 45 E.R. 901
BEFORE THE LORDS JUSTICES.
S. C. 31 L. J. Ch. 129; 5 L. T. 439; 8 Jur. (N. S.), 604; 10 W. R. 67.
[318] benham v. keane. Before the Lords Justices. Nov. 4, 5, 6, 25, 1861. [S. C. 31 L. J. Ch. 129; 5 L. T. 439 ; 8 Jur. (N. S.), 604; 10 W. R. 67.] The priority as against lands in Middlesex of a judgment registered in the Middlesex Registry over a judgment, which, though earlier in date, is later in order of registration on the Middlesex Registry, is not lost by reason of the judgment creditor's having notiee of such earlier judgment at the time when his judgment is entered up. This was an appeal by Mr. Beavan, a judgment creditor of the late Lord Morn-ington, from a decision of the Vice-Chancellor Sir W. P. Wood as to the priorities of incumbrances on some property of Lord Mornington in Middlesex. The several incumbrances, as ascertained in the suit, which was a suit by another judgment creditor to enforce his judgment, were as follows:- 1. Mr. Beavan's judgment, entered up on the 29th of October 1836. It was registered in the Common Pleas on the passing of 1 & 2 Viet. c. 110, and had from, time to time been duly re-registered. It was not registered in the Middlesex Registry till the 10th of November 1857. 2. Robins's judgment, entered up and registered in the Common Pleas on the 15th of April 1846, but not re-registered till March 1858. It was registered in Middlesex on the 16th oi May 1846. This judgment was assigned to a trustee for the Plaintiff on the 27th of February 1858. 3. Smith's judgment, entered up on the 1st of May 1846, registered in the Common Pleas on the 19th of June 1846, and subsequently from time to time duly re-registered. Registered in Middlesex on the 5th of July 1851. 4. The Plaintiff's judgment, entered up and registered in the Common Pleas on the 24th of May 1847, and from time to time duly re-registered. Registered in Middlesex on the 4th of January 1848. [319] 5. Daniel Keane's mortgage, dated the 24th of August 1847, and registered in Middlesex on the following day. Subsequently, on the 16th of February 1850, this mortgage was transferred to David D. Keane, in trust for Daniel Keane, and by a deed of even date the equity of redemption was conveyed to Daniel Keane. 6. A sub-mortgage of Daniel Keane's interest in this property made to Landon and D. D. Keane on the 24th of December 1853. Daniel Keane, when he took his mortgage, had notice of Beavan's judgment, and it was contended that Robins, the Plaintiff, and Lanclon and D. D. Keane also had notice of it at the times when they respectively entered up their judgments and took their security. The chief clerk certified the priorities according to the dates of the Middlesex registrations. Mr. Beavan and Landon and D. D. Keane took out summonses to vary this certificate. The Vice-ChanceHor held, (1) That notice was immaterial as between judgment creditors, and that the Plaintiff therefore in respect of his own judgment and that of 902 BENHAM V. KEANE 3DBO.F.& J. 3M. Robins did not lose, by reason of notice, the priority over Beavan to which he was entitled by prior registration in Middlesex; (2) That Keane having taken his security with notice of Beavan's judgment must be postponed to Beavan; (3) That Landon and D. D. Keane had priority over Robins, by reason of Robins's omission to re-register; (4) That if the proceeds of the estate were not more than sufficient to satisfy the two judgments belonging to the Plaintiff, Beavan must be postponed to Landon and D. D. Keane. [320] His Honour therefore settled the order of priority as follows :- 1. The Plaintiff's own judgment. 2. Landon and D. D. Keane's mortgage. 3. Robina's judgment belonging to the Plaintiff. 4. Beavan's judgment. 5. Daniel Keane's interest. But thia was to be without prejudice to any questions between the Plaintiff, Landon and D. D. Keane, and Beavan with respect to Landon and D. D. Keane's mortgage debt, in case the proceeds of the estate should be more than sufficient to satisfy the two judgments belonging to the Plaintiff (1 Johns. & H. 685). Mr. Beavan appealed from this decision, contending that all the subsequent judgment creditors had notice of his judgment at the times when theirs were entered up, and that he therefore was entitled to rank as the first incumhrancer. the solicitor-general (Sir R. Palmer) and Mr. Cole, for the Appellant. Mr. Beavan's judgment was registered in the General Register before any of the other incumbrances were in existence, but it was not registered in Middlesex until after they had all been registered there. All the other incumbrancers, however, had notice of his ineumbrance. The Vice-Chancellor considered that a purchaser was affected by notice of a judgment though not registered in Middlesex, and that Daniel Keane must therefore be postponed to Beavan, as in Proctor v. Cooper (2 Drew. 1 ; 1 Jur. N. S., 149), but he held that notice of a prior judgment has no effect on a judgment creditor, the result of which is that Beavan [321] must be postponed to all the inoumbrancera except Keane. This is a new doctrine. We contend that the conscience of the subsequent judgment creditor is affected by notice of our prior judgment, just as much as by notice of a prior charge arising ex contradu; Lee v. G-reen (6 De G, M. & G. 155) ; the judgment having given Mr. Beavan an interest of exactly the same nature as if Lord Mornington had, by writing, agreed to charge the land. The principle which the Vice-Chancellor has propounded is, that a judgment creditor with notice is in a better position than a purchaser with notice. This must be considered both on the statutes and on the authorities. Compare 4 & 5 Will. & Mary, c. 20, s. 3, and 7 Anne, c. 20, s. 18. There is nothing in the statutes to shew that they are to be construed more favourably for subsequent judgment creditors than for subsequent purchasers. Now to look at the case upon the authorities. The general principle as to the effect of notice in cases of this nature is laid down in Le Neve v. Le, Neve (3 Atk. 655), where Lord Hardwicke says, " Now if a person does not stop his hand, but gets the legal estate, when he knew the right in equity was in another, machinatur ad circumvenif,ndwm; and it is a maxim too in our law that fraus et dolus nemini patrocinari debent." In Davis v. Strathmare (16 Ves. 419), which arose under the Docketing Act, Lord Eldon refers to the cases under the Registry Acts as analogous, and his observations shew that he saw no difference between the cases of a prior purchaser and a prior judgment creditor. A purchaser has no equity against a prior judgment creditor of whose judgment he had notice, he did not deal for the land on the footing that there was no judgment. A fortiori, a judgment creditor has no equity against a prior judgment- creditor of whose judgment he had notice, for [322] he gets a charge only on what remains in his debtor. A judgment creditor becomes an ineumbraucer on what he can get; he takes the estate as he finds it. His charge extends only to what the debtor could honestly have sold to a purchaser, and what the purchaser could have kept. Here a judgment creditor has been held to acquire a valid charge on what a purchaser, knowing the circumstances, could not have kept. A judgment, though not registered in Middlesex, is not null, but gives an inchoate title, which a person having knowledge of it is not at liberty to disregard. Tv/nstall v. Trappes (Gosling's case (3 Sim. 301) proceeds on the proposition laid down by Lord Eldon, that no person claiming under a judgment debtor with notice of the SBBa.F.ftJ.3J3i BENHAM V. KEANE 308 judgment can defeat the judgment. The principle is that a judgment is a charge which no one having notice of it can, in equity and good conscience, disregard ; Sugd. Vend. & Purch. (page 661 (llth edit.). The statute 1 & 2 Viet. c. 110, s. 13, contains nothing to put a prior judgment creditor in a worse position than he was in before the passing of that Act; it would seem rather to put him in a better position, for it gives him an interest of the same nature as if it had arisen from contract. The decisions on this section have determined two points : first, that the section does not turn a judgment creditor into a purchaser, so as to enable him to defeat a voluntary settlement; Beavan v. Lord Oxford (6 De G. M. & G. 507); secondly, that the judgment only operates upon what is, in the view of a Court of Equity, the debtor's property-that which he could dispose of without wronging any other person ; Whit-worth v. Gaugain (I Phill. 728); so that the interest of the judgment creditor is substantially the same as if the debtor had given him a charge by a writing, mentioning every existing charge and lien on the property. Now it has [323] been urged that we must impart into this section that a judgment is not to take effect under it in a register county until registration. The statute contains nothing to that effect. The decisions at law, Doe v. Alsop (5 B. & Aid. 142); Westbrooke v. Blythe (3 Ell. & Bl. 737), and Hughes v. Lumley (4 Ell. & Bl. 274), are immaterial, the point being a purely equitable one. The only case raising a primfr fade difficulty in our way is Johnson v. Holdsworth (I Sim. N. S. 106). The decision there is difficult to be supported; but it goes no further than this, that the judgment creditor, who had not registered at all in the county, had no such direct interest in the land as to make him a necessary party to a suit by a person having a title paramount to his. The Court is very much disposed to dispense with the presence of puisne judgment creditors in a foreclosure or redemption suit. Robinson v. Woodward (4 De G. & Sm. 562) shews the effect of notice. As between Beavan and Landon, how is it made out that Beavati has lost his priority ; the only case being that there are two persons, Robins and tlie Plaintiff, who have rights against one of them...
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