SHIRRAS

As to the objection that one of the mortgagees was not & OTHERS a creditor at the date of the mortgage, and did not become a creditor upon the faith of the mortgage, it is CAIG & laid down in Powell on Mort. 275, that if one purchase in MITCHEL. the name of another without any authority to do so, yet if he afterwards agree to it, he makes the former his agent ab. initio.

The Complainants therefore, are entitled to a decree for a foreclosure of one half of the property described in the mortgage, and for the recovery of all sums advanced on the faith of the mortgage before the mortgagees had notice of the second incumbrance.

Feb. 17, All the Judges (except Washington, J.* ) being present,

MARSHALL, Ch. J. delivered the opinion of the Court as follows:

This is an appeal from a decree rendered by the Circuit Court for the district of Georgia.

Shirras and others, the Appellants, brought their bill to foreclose the equity of redemption on two lots lying in the town of Savannah, alledged to have been mortgaged to them by Edwin Gairdner. The deed of mortgage is dated the first of December, 1801, and purports to be a conveyance from Edwin Gairdner and John Caig, by Edwin Gairdner his attorney in fact. Edwin Gairdner not appearing to have possessed any power to act for John Gaig, the conveyance, as to him, is void, and could only pass that interest which was possessed by Gairdner himself. The Court will proceed to inquire what that interest was.

It appears that, on the 17th May, 1796, the premises were conveyed to James Gairdner, Edwin Gairdner and Robert Mitchel, merchants & co-partners of the city of Savannah.

In 1799, this partnership was dissolved; and, in December in the same year, James Gairdner made an en

* JUDGE WASHINGTON was prevented by indisposition, from attending on the 13th, 14th, 15th, 17th and 18th of February.

try on the books of the company charging this property SHIRRAS to Edwin Gairdner & Co. of Charleston, at the price of & OTHERS 20,000 dollars. This firm consisted of Edwin Gaird

v.

ner alone. James Gairdner also executed a power of CAIG & attorney authorizing Edwin Gairdner to sell and con- MITCHEL. vey his interest in this and other real property.

In March, 1801, a partnership was formed between Edwin Gairdner and John Caig to carry on trade in Savannah, under the firm of Edwin Gairdner & co.; and in the same month, Robert Mitchel conveyed his one third of the lots in question to Edwin Gairdner and John Caig.

About the same time it was agreed between the house at Charleston and that in Savannah to transfer the Savannah property to the firm trading at that place; and entries to that effect were made in the books of both companies; and possession was delivered to Edwin Gairdner and Co. of Savannah.

Such was the state of title in December, 1801, when the deed of mortgage bears date.

The Plaintiffs claim the whole property, or, if not the whole, five sixths; because they suppose Edwin Gairdner to have been equitably entitled to his own third, to that of James Gairdner, and to half of the third of Robert Mitchel. But for this claim the Court is of opinion that there can be no just pretension, because he did not affect to convey by virtue of the power from James Gairdner-he did not affect to pass the interest of James Gairdner, but to pass the estate of John Caig and himself. Consequently the power of attorney may be put out of the case, and the conveyance could only operate on his own legal or equitable interest.

In law, he was seized under the original deed, and the deed from Robert Mitchel of one undivided moiety of the property.

Under the various agreements and entries on the books of the firms at Charleston and Savannah which have been stated, his equitable interest was precisely equal to his legal interest. In law and equity he held one

SHIRRAS moiety of the premises in question. The other moiety & OTHERS was in John Caig. To one sixth Caig was legally entiv. tled by the conveyance from Robert Mitchel, and to CAIG & two sixths he was equitably entitled by the agreement MITCHEL. With Edwin Gairdner and the consequent entries on the books.

Of the equitable interest of John Caig the mortgagees were bound to take notice, because the purchaser of an equitable interest, purchases at his peril, and acquires the property burdened with every prior equity charged upon it, because the deed itself gives notice of Caig's title, and because Caig was in possession of the property.

The mortgage deed of December, 1801, could not, then, in law or equity, pass more than one moiety of the property it mentions.

A question crises on the face of the deed respecting the extent of the property comprehended in it. The Plaintiff's contend that both lots are within the description; the Defendants that only the wharf lot is conveyed.

The property conveyed is thus described-"All that "lot of land, houses and wharfs in the city of Savannah "as is particularly described by the annexed plat, and "is generally known by the name of Gairdner's wharf."

The plat was not annexed, nor was it recorded with the deed. It is, however, filed as an exhibit in the cause, and appears to be a plat of part of the town of Savannahı, including the lot on which Gairdner's wharf was, and also one other lot belonging to the same persons, which was designated as No. 6, and which does not adjoin the property on which the wharves are erected.

The words descriptive of the property intended to be conveyed do not appear to the Court to be applicable to more than the wharf lot. The word "lot" is in the singular number; the term "houses" is satis-" fied by the fact that there are houses on the wharf lot; and there is no evidence in the cause, nor any reason to believe that lot No. 6 was "generally known "by the name of Gairdner's wharf." The Court. therefore, cannot consider that lot as comprehended within the conveyance.

The mortgaged property is in possession of the Defen- SHIRRAS dants, Caig and Mitchel, who derive their title thereto & OTHERS in the following manner.

V.

CAIG &

On the 7th of January, 1802, a new partnership was MITCHEL. formed between Gairdner, Caig and Mitchel, and, bythe articles of co-partnery, which are under seal, the Savannah property is declared to be stock in trade, and an entry was made on the books of the old firm transferring this property to the new concern. On the 12th of the same month, the co-partnership of Gairdner and Caig was dissolved.

On the 27th of July, 1802, by deeds properly executed, one third of the property became vested in John Caig, and one other third in Robert Mitchel.

On the 3d of November, 1802, Edwin Gairdner became a bankrupt; and this bill is brought by his mortgagees and assignees.

The claim to foreclose is resisted by Caig and Mitchel, because, they say,

1st. The mortgage was not executed at the time it bears date, but long afterwards, and on the eve of bankruptcy.

2d. That the transaction is not bona fide, there being no real debt, nor any money actually advanced by the mortgagees.

sd. That the mortgage was kept secret, instead of being committed to record.

4th. That the whole transaction is totally variant from that stated in the deed.

They therefore claim the property for the creditors of Gairdner, Caig and Mitchel.

1st. From the testimony in the cause it appears that the deed, if not executed on the day, was executed about the day of its date; and that Gairdner, at the time, was believed to be solvent.

SHIRRAS

2d. It appears, also, that the mortgage was executed, & OTHERS in part, to secure the payment of money actually due at υ. the time, and, in part, to secure sums to be advanced, CAIG & and to indemnify some of the mortgagees for liabilities to MITCHEL. be incurred.

3d. The mortgage is dated the 1st of December, 1801, and was recorded in September, 1802.

By the laws of Georgia, a deed is valid if recorded within twelve months; but any deed recorded within ten days after its execution takes preference of deeds not recorded within that time, or previously on the record.

It appears to the Court, that neither negligence, nor that fraud which is inferred from the mere fact of omitting to place a deed on record, can, with propriety, be imputed to the person who has used all the dispatch which the law requires. If subsequent purchasers without notice, sustain an injury within the time allowed for recording a deed, the injury is to be ascribed to the law, not to the individual who has complied with its requisition.

In this case the subsequent purchasers might have proceeded to record their deeds within ten days, and have thereby obtained the preference they claim, but they have failed to do so. They are themselves chargeable with the very negligence which they ascribe to their adversaries; and, were they to be preferred, the Court would invert the well established rule of law, and postpone, under similar circumstances, a prior to a subsequent deed.

4th. It is true that the real transaction does not appear on the face of the mortgage. The deed purports to secure a debt of 30,000l. sterling due to all the mortgagees. It was really intended to secure different sums, due at the time from particular mortgagees, advances afterwards to be made, and liabilities to be incurred to an uncertain amount.

It is not to be denied, that a deed, which misrepresents the transaction it recites, and the consideration on which it is executed, is liable to suspicion. It must sustain a