Hupper v. Smith.

notice of its existence to those who subsequently acquire an interest in or liens upon the land upon which it is a lien. If, therefore, before or at the time of acquiring such interest there is notice of the mortgage, to subsequent purchasers or lien creditors, it will continue valid as a lien as against them even though it has not been recorded. If there is no such notice to those who have subsequently acquired interest in the property of the existence of the mortgage they are not affected by it. Notice may be given in other ways than by recording a mortgage. It may be actual or constructive. A reference to a mortgage in a deed, either as part of the consideration or a mention of it in the receipt attached to a deed where such deed forms part of the owner's chain of title, is constructive notice to such owner or to anyone about to acquire an interest in the land of its existence.

In Steckel et al. v. Desh, 2 Penny. 303, Daniel Desh conveyed land to Solomon A. Steckel, by deed dated September 9, 1868, upon which deed the following receipt appeared, "Received on the day of the above written indenture the sum of $16,500.00 by bond and mortgage, bearing even date herewith, in full of the consideration money within mentioned. Daniel Desh." Before any mortgage was recorded Steckel conveyed the land to other persons. After the mortgage was recorded a sci. fa. was issued upon it, naming the grantees of Steckel as terre tenants. It did not even appear that they had ever seen the deed from Desh to Steckel containing a receipt. The Court below decided that the receipt in the deed to Steckel was notice of the mortgage to all who claimed title under it, through Steckel, and that the mortgage was a lien against the land in their possession even though never recorded. This was affirmed by the Supreme Court. Judge Trunkey, who delivered the opinion of the Court said, "The learned judge of the common pleas rightly ruled that notice to a purchaser, of an unrecorded mortgage, is sufficient to continue its lien on the land, and that the receipt in Steckel's deed was notice of the mortgage to all who held under him."

In Erb v. Myers, 18 Philadelphia 313, Judge Fell decided that mention of a mortgage, which is not recorded, in the deed was notice to subsequent purchasers of the land of the existence of such mortgage.

In the present case there is more than a mention of the mortgage in the receipt. The deeds from Mayer to Rintz and from Rintz to Mayer mention it as part of the consideration money, and the habendum states that the property is taken subject to it. This is in addition to its having been mentioned in the receipt. The case in these respects is stronger in favor of the mortgage being a lien than it was in the case of Steckel v. Desh, supra. In that case, however, the receipt showed to whom and when the mortgage had been given. In the present case there is nothing to indicate to whom or when the mortgage was given. We are satisfied that this does not affect the case.

In Philipsburg Bank Appeal, 12 W. N. 265, notice of an unre'corded mortgage to the subsequent mortgagee was a remark that "A has not entered his claim." This was held to be sufficient notice of such unrecorded mortgage, and to give it priority over the lien of a

subsequent mortgage.

Hupper v. Smith.

It will be observed that neither the amount of A's mortgage nor when it was given appears in this notice.

In Day v. Day, 3 Penny. 294, the facts are as follows: Day and Saylor, in 1861, conveyed land to Day & Woodring, in consideration of one dollar and seventy-nine promissory notes of the vendees for an aggregate amount of $126,000.00. These notes were for various amounts and payable at different times. At the same time Day & Woodring executed and delivered a mortgage to Day and Saylor to secure the payments of the notes. The mortgage was recorded. Some of the notes were subsequently assigned by Day and Saylor to a Stroudsburg bank. Day & Woodring, in 1864, reconveyed the land to Day and Saylor. Reciting in the deed that they were unable to pay the notes, and that the grantees, Day and Saylor, assumed and agreed to pay them. In 1868 Saylor released the land from the lien of the mortgage, and the land was subsequently sold to other persons. In 1877, nine years afterwards, the Stroudsburg Bank issued an alias sci. fa. upon the mortgage. The Supreme Court decided that the recital in the deed that the notes were not paid, and that the original vendors assumed liability to pay them, was notice to subsequent purchasers, and that Saylor had no power to satisfy the mortgage. Judge Sterrett, delivering the opinion of the Court, said: "It is very evident from the deed itself that such was the intention of the parties; and it is equally clear that all the terre tenants are affected with constructive, if not actual, notice of everything contained in the deed. It was directly in the line. of the title they acquired, and whether it was recorded or not at the time they purchased, it was their duty to see and examine it, and the presumption is that they did do so. This leads to the conclusion that they knew the parties from whom they were purchasing had assumed the payment of the outstanding bonds. It was, therefore, their duty to inquire and satisfy themselves that the bonds had been paid. They had no right to rely upon the statement, written or oral, of their vendors, Day & Saylor. Having agreed to take up the bonds as consideration in part of the reconveyance to them, they practically occupied the position of obligors. If the terre tenants failed to insist upon the production of the outstanding bonds or other satisfactory evidence that they were paid, they assumed a risk the consequences of which they must bear." It will be observed that the recital in the deed in that case did not give notice of the amount nor to whom the notes were payable, but it was held to be the duty of the subsequent purchasers to ascertain these facts from the notice given in the deed, and to see that the notes were paid before accepting title.

Applying these rules to the present case, we find that the notice in the deeds of the existence of a mortgage, even though it does not appear to whom or when it had been given, was notice to all subsequent purchasers of its existence, and it is, therefore, a lien upon the property.

Plaintiff, therefore, did not offer to convey, as he had agreed to do, the property free or clear of all encumbrances, and is, therefore, not entitled to recover. Judgment is, therefore, entered for the defendant.

Supreme Court of Pennsylvania

Mendenhall, Administratrix of Jackson, v. Jackson, Adm'r of Jackson, Venie Carnathan et al.

Decedents' estates-Mortgage-Distribution-Affect of approval by O. C.-Fraud-Notice by advertisement—Affidavits of defense-Form of averments.

The validity of a mortgage created by the administrator of a decedent upon decedent's real estate with the approval of the Orphans' Court cannot be impeached in the Common Pleas except for fraud, and such fraud is not shown by proof that the mortgage was created to pay debts and expenses for which the administrator, as the husband of decedent, was personally liable, where the proceeds of the mortgage, as well as the payment complained of, were included in the administrator's acount, which was approved by the Orphans' Court.

In such case the administrator who created the mortgage being dead, and the personal property of his decedent distributed and the lien of her debts expired, it was not necessary that a new administrator should have been appointed and included among the defendants.

The proper advertisement of the filing of an administrator's account is effective legal notice to all parties interested.

An affidavit of defense which alleges facts upon information and belief and not on personal knowledge must also aver that the defendant expects to be able to prove them.

Appeal No. 116 of January Term, 1920, by Venie Carnathan et al., defendants, being remaindermen, owners and terre tenants, from judgment of C. P. of Lancaster County to May Term, 1919, No. 38, entered against said defendants and in favor of the plaintiff, Jennie E.. Mendenhall, Adm'r of Wilson W. Jackson, dec'd, who was transferreeof David C. Jackson, for want of a sufficient affidavit of defense Affirmed.

Error assigned was the findings and action of the Court below, HASSLER, J., in entering judgment for the plaintiff.

For opinion of the Court below, see 36 Law Review 236.

H. Edgar Sherts, for appellant.

The mortgage was allowed to pay debts for which the husband and administrator was personally liable. Santelle's Appeal, 84 Pa. 306; Berger v. Clark, 79 Pa. 340.

The order to mortgage can be attacked in Common Pleas for fraud. Cobett's Estate, 10 D. R. 59; Murphy's Appeal, 8 W. S. 165.

It was error to enter judgment without a new administration on the estate of Amanda Jackson. T. & H., Prac., Vol. 3, p. 2572; Conshohocken S. F. & L. Assn. v. Citron, 22 Dis. Rep. 738; First Natl. Bank v. Ryan, 14 D. R. 450; Gelston v. Donnon, 44 Super. 280; Brooks v. Smyser, 48 Pa. 86; Starr v. York Natl. Bank, 55 Pa. 364; Wagner's Estate, 227 Pa. 460; Ward's Estate, 3 Pa. C. C. R. 224; Geiger's Appeal, 24 W. N. C. 264; Neide's Estate, 22 D. R. 563; 16 Cyc. 634.

VOL. XXXVII, No. 46

Mendenhall, Administratrix of Jackson, v. Jackson, Adm'r of Jackson, Venie Carnathan et al.

Willis G. Kendig, for defendant.

The Practice Act of 1915 limits defenses to those set forth in the affidavit and should be strictly enforced. Ruth-Hastings Glass Tube Co. v. Slattery, 266 Pa. 288.

Averments of fraud must set forth the facts. Felleman v. Cassler, 198 Pa. 407.

The judgment of the Orphans' Court was conclusive and must stand. Specific notice to liens was not necessary. Smith's Estate, 188 Pa. 222; Brock v. Steel Co., 203 Pa. 249.

The affidavit was defective in that it did not assert that the defendant expected to be able to prove the facts alleged on information and belief. Louchsenir v. Maguire, 186 Pa. 311; Newbold v. Pennock, 154 Pa. 592; Telli v. Vandergrift, 18 Super. 485; Mouk v. Magee Carpet Co., 69 Super. 436.

June 26, 1920. Opinion by MR. JUSTICE SIMPSON.

Mrs. Amanda Jackson died intestate, leaving to survive her, her husband, Wilson W. Jackson, but no descendants; and by reason thereof he became life tenant of her real estate, and her collateral heirs, some of whom are appellants in this case, became remaindermen thereof. Her husband was appointed administrator of her estate, and upon his petition, without notice to appellants, the orphans' court authorized him to create a mortgage of $2250 upon a farm owned by her, in order to raise money with which to help pay certain of her alleged debts, her funeral expenses, her tombstone and the cost of settling her estate. Under this authority the mortgage was executed and delivered to David C. Jackson, and was approved by the orphans' court. It was admitted at bar that the administrator thereafter filed his account, charging himself, inter alia, with the amount of the mortgage, and the balance appearing by the account was duly distributed under the order of the orphans' court. Appellants were not actually notified of its filing, but it was duly advertised, thus giving to them effective legal notice: Priestley's Appeal, 127 Pa. 420; Ferguson v. Yard, 164 Pa. 586. Subsequently the administrator took an assignment of the mortgage, and continued to be the owner thereof and of a life estate in the property until he died, January 17, 1919.

Plaintiff as administratrix of his estate, which was owner of the mortgage by assignment as aforesaid, issued a sci. fa. thereon against him as administrator of his wife's estate as mortgagor, with notice to herself as administratrix; and with notice also to the terre tenants. Appellants filed an affidavit of defense, a rule for judgment for want of a sufficient affidavit was made absolute against them, as terre tenants only, later a judgment for want of an affidavit of defense was entered against the other terre tenants and the mortgagor, and the present appeal followed.

It is admitted the orphans' court had authority to authorize and approve the execution and delivery of the mortgage, and that it is not

Mendenhall, Administratrix of Jackson, v. Jackson, Adm'r of Jackson, Venie Carnathan et al.

subject to collateral attack in the court of common pleas except for fraud; but it is alleged such fraud exists in the present case, because the debts set forth in the petition were not due by decedent, and the funeral expenses and cost of her tombstone were primarily payable by her husband who, as stated, was the petitioner for the mortgage, and afterwards became the owner thereof. This, however, was a matter for the orphans' court, and is conclusively determined against appellants by its decree of distribution, finding those debts, as specified in the petition, to have been due by decedent's estate, and awarding payment thereof to the creditors named. Entirely aside from this, however, a like effect resulted from the decree on the petition for and the later confirmation of the mortgage; for thereby the court determined it should be made, because the stipulated debts ought to be paid by decedent's estate, and the mortgagee and his assignee were not required to investigate the matter further: Brock v. Penna. Steel Co., 203 Pa. 249.

In the affidavit appellants also aver, upon information and belief, that the mortgage was made by collusion between the mortgagor and mortgagee, and no consideration passed either on its delivery or assignment. Even if this allegation were otherwise valid, it would be fatally defective for want of an averment of an expectation to prove it on the trial of the case: Newbold v. Pennock, 154 Pa. 591; Wakely v. Sun Insurance Office, 246 Pa. 268.

It is also alleged that the judgment was improper because none of the record defendants actually represented the estate of Amanda Jackson. This was not necessary, however, since that estate was not a party to the mortgage. Judgment has been entered against the actual mortgagor, and it is not now quoted and assigned as error. Moreover, as the court below points out, the estate is not concerned in this proceeding. The personal property left by decedent has been distributed, and the lien of her debts has long since expired. If she had been a party to the mortgage, it would have been necessary to make her a defendant; but even then by section 14 of the Act of July 9th, 1901, P. L. 614, return of mortuus est" could not have been made to the writ. this Act sought to accomplish, namely, to give notice to all persons actually interested, has been accomplished; and defendants, who are interested, were given ample opportunity to interpose any defense they had. They were entitled to this but to no more; and cannot be heard to complain even if the court below erred in holding everybody else interested had received due notice.

"the

What

Finally, it is claimed that too much interest was allowed in the assessment of damages, in that it included a considerable sum which plaintiff's decedent, as life tenant of the property, was in duty bound to pay in relief of the estate of the remaindermen, and hence his administratrix cannot collect it to the detriment of that estate. On this point the decision of the court below was erroneous; but since the parties, upon having their attention called to the matter, have agreed, if we sustain this contention, that the judgment should be reduced to the sum of $2421.56, we only need make an order to that effect.