Willard v. Ramsburg

Golusbokough, J., delivered the opinion of this Court. Peter Young, one of the appellees, executed a mortgage to Abraham Willard, the appellants’ testator, on the 24th day of August 1858, to secure the payment of the respective sums therein stated. The appellants after the death of the mortgagee, filed their bill of complaint in the Circuit Court for Frederick County, on the 14th day ²¹⁶ of October 1859, to obtain a decree for the sale of the mortgaged premise’s. The appellees to whom Young had also given a mortgage on the same property on the 21st day of August 1858, were made defendants to the above suit, and by their answer assented to a decree and sale of the mortgaged property, and to have all questions of the priority of right settled before the auditor in the distribution of the fund arising from the sale.

The evidence shows that Willard’s mortgage was received to he recorded, on the 25th day of August 1858, at half past nine o'clock in the morning, and that the appellees’ mortgage was received for record some time after on the same day. The property was sold by the trustee appointed by the Court, the sale reported and finally ratified. The cause being sent to the auditor, he stated two accounts: No. 1, under the instruction of the complainants’ solicitor, allowing the complainants’ claim, and appropriating the balance of the proceeds of sale, after deducting expenses of suit to the satisfaction thereof; and No. 2, under the instruction of the defendants’ solicitor, allowing the claims set forth, excluding the complainants. The appellants filed exceptions to the auditor’s report No. 2, the Circuit Court overruled these exceptions, and by a pro forma decree passed by agreement, finally ratified the auditor’s report No. 2.

From this decree the complainants prosecuted this appeal. The exception taken to the testimony of Peter Young involved his competency to testify, he being a party defendant, and alleged to be liable for costs, and interested.in the suit. This exception was overruled by the Circuit Court, and we think correctly. When the exception was taken, the case was before the auditor.

Young’s equity of redemption had been foreclosed by the decree, a sale of the property had been made, and the fund arising ²¹⁷ from the sale was about to be distributed to the mortgagees entitled thereto. In this attitude of the case, where the contest was between the prior and subsequent mortgagees, Young must be regarded as holding a perfectly impartial relation both to the parties, and the fund in controversy, and without any interest which would render him incompetent. We are next to consider the important question, whether the mortgage ’of Willard being first recorded, such registration gave to the mortgagee a priority of lien, to the exclusion of the rights of the appellees under their mortgage. This involves the further