Antrim County Land Building & Investment Company v Stewart

• Jurisdiction: Ireland
• Judgment Date: 06 May 1903
• Date: 06 May 1903
• Docket Number: (1902. No. 1896.)
• Court: Court of Appeal (Ireland)

The Antrim County Land, Building, and Investment Company, Ltd., and John Houston

and

John Stewart and William Stewart (1).

K. B. Div.

Appeal.

(1902. No. 1896.)

CASES

DETERMINED BY

THE KING'S BENCH DIVISION

OF

THE HIGH COURT OF JUSTICE IN IRELAND,

AND ON APPEAL THEREFROM IN

THE COURT OF APPEAL,

AND BY

THE COURT FOR CROWN CASES RESERVED.

1904.

Landlord and tenant — Action for recovery of land — Title — Second mortgagee against mortgagor — Legal estate outstanding.

The defendants bought their farm from their landlord, through the Land Commission, under the Land Purchase Acts, in 1886, and by deed dated the 12th August, 1886, the lands were conveyed to them in fee. By the same deed the defendants mortgaged the land to the Irish Land Commission as security for the repayment of the purchase annuity. By a mortgage, dated the 4th May, 1901, the defendants mortgaged the land to the Antrim Building Company to secure the repayment of £1000. The mortgage contained a power of sale and an express statement of the mortgage to the Land Commission. The Antrim Building Company sold the land under the power of sale to Houston.

In an action of ejectment on the title by the Company and Houston as co-plaintiffs:—

Held, by the King's Bench Division, that the judgment should be changed into one for the defendants. Per Lord O'Brien: That having regard to the decision of Hodgens v. O'Donoghue (28 I. L. T. R. 98), which a Court of first instance could not overrule, the judgment should be entered for the defendants.

Held, by the Court of Appeal (reversing the King's Bench Division, and restoring the judgment of Kenny, J., at the trial), that the defendants could not set up, as a defence, that the legal estate was outstanding in the Land Commission, and that the plaintiffs were entitled to possession without bringing the Land Commission before the Court.

Ejectment on the title brought to recover possession of part of the lands of Aghahaskin, in the county of Londonderry, containing 48a. 0r. 21p. held by the defendants in fee-simple, subject to an annuity of £24 2s. 10d. payable to the Irish Land Commission for forty-nine years from the 1st November, 1886.

The defendants had purchased the land from their landlord under the Land Purchase Acts, and by deed dated the 12th August, 1886, the lands were conveyed to the defendants in fee-simple, and by the same deed the defendants mortgaged the land to the Irish Land Commission to secure the payment of an annuity

of £24 2s. 10d., payable to the Land Commission for forty-nine years from the 1st November, 1886, being the annual instalments of the purchase-money. By indenture dated the 4th May, 1901, the defendants as beneficial owners granted the lands to the Antrim Building Company (the first named plaintiffs) by way of mortgage to secure the repayment of £1000 and interest. This deed expressly referred to the former mortgage of the 12th August, 1886, and it contained a power of sale. On the 27th Febuary, 1902, the Antrim Building Company, in exercise of their power, put up the lands for sale by public auction, and the plaintiff John Houston was declared purchaser, and signed an agreement for completion of the purchase, but no conveyance of the lands had been executed to him. The defendants refused to give up possession, and the action was brought by the Antrim Building Company and Houston. The defendants pleaded possession.

At the trial before Kenny, J., without a jury, on the 14th February, 1903, his Lordship gave judgment for the plaintiffs with costs. The defendants moved to set aside the judgment, and to enter judgment for the defendants.

Bartley, for the defendants.

Christie, for the plaintiffs.

Lord O'Brien, L.C.J.:—

We are of opinion that this case is governed by that of Hodgens v. O'Donoghue (1), which was decided by the Lord Chief Baron and Mr. Justice Murphy, in which it was held that an action of ejectment is not maintainable by a puisne incumbrancer where the legal estate is outstanding in a prior incumbrancer who is not a party to the action. There is a decision opposed to that of the Lord Chief Baron of Browne v. Hallissy (2); that case was before the Chief Baron and Mr. Justice Murphy in Hodgens v. O'Donoghue (1), and they refused to follow it, and refused to follow it on the distinct ground that it was wrongly decided, and this after the passing of the Judicature Act.

We are bound by the judgment of the Divisional Court in the later case, we have no jurisdiction or authority to disregard that judgment, and if it is to be questioned it must be questioned elsewhere.

It occurred to me that as between the two parties to this action, it being merely a possessory action, the mortgagee would be entitled to possession, the mortgagor being in possession, because the owner of the legal estate would be in no way prejudiced. I do not say that I would have acted necessarily on that view if I had considered the point very fully, which I have not, but here we are bound by the judgment in Hodgens v. O'Donoghue (1), and we must decide in favour of the defendants.

Mr. Christie, who appeared for the plaintiffs, more than once refused to argue the case on the ground of estoppel. The point that the legal estate was outstanding in the Land Commission was not made before Mr. Justice Kenny at the trial of the action; his attention was not called to that fact. We must follow the decision in Hodgens v. O'Donoghue (1) and decide in favour of the defendants. Both Hodgens v. O'Donoghue (1) and Browne v. Hallissy (2) were decided since the passing of the Judicature Act. We are bound by the judgment of Hodgens v. O'Donoghue (1), and if it is to be questioned, that must be done in the Court of Appeal.

We will give the costs of the trial to the defendants, but no costs of this argument.

Madden, J.:—

The case referred to by Mr. Christie, Doe d. Hurst v. Clifton (3), was a case of estoppel, and Mr. Christie could not argue the question of estoppel, having regard to the form of the mortgage in the present case. Doe d. Hurst v. Clifton (3) extended the doctrine of estoppel as laid down by former decisions. It was always held as between mortgagor and mortgagee that the mortgagor was estopped by his deed. He could not derogate from his grant, and set up jus tertii, by relying upon a legal estate outstanding in a former mortgagee. The case was different where the earlier mortgage was recited or referred to. The case of Doe d. Hurst v. Clifton (3) applied that principle to a defendant who was not a mortgagor, but who defended in the interests of the mortgagor. That case has no application here, and I concur with the Lord Chief Justice in thinking that the case before us is ruled by the decision of this Court in Hodgens v. O'Donoghue (1).

r. st. j. c.

The plaintiffs appealed (1).

Matheson, K.C., and Christie, for the appellants:—

The mortgagor cannot derogate from his own grant: Robins on Mortgages, vol. I., 654; Everest on Estoppel, 194, 254; Cole on Ejectment, 473, 271; Goodtitle v. Bailey (2); Doe d. Bristow v. Pegge (3); Right d. Jefferys v. Bucknell (4); Doe d. Ogle v. Vickers (5); Doe d. Hurst v. Clifton (6); Doe v. Horne (7); Lindsey v. Lindsey (8); Doe d. Leeming v. Skirrow (9); Browne v. Hallissy (10); General Finance Mortgage and Discount Company v. Liberator Permanent Building Society (11). The doctrine of derogation is without reference to the technical doctrine of estoppel: Right d. Jefferys v. Bucknell (4); General Finance Mortgage and Discount Company v. Liberator Permanent Building Society (11).

The Court will not allow a defendant in ejectment to set up any defence which is against justice and conscience. Assuming that the outstanding legal estate is a bar, it is such a bar as the defendant, prior to the Judicature Act (Ireland), 1877, would have been restrained, by order under section 89 of the Common Law Procedure Act, 1856, from setting up: Wylie, pp. 404, 405; Mitf. Pl., 5 ed., 156–7; Dan. Ch. Pr., 5 ed., 1513; Blennerhasset v. Day (12); Olden v. Stokes (13); Eager v. Maunsell (14); Thornton v. Court (15); Bond v. Hopkins (16); Griffith v. Edwards (17).

It makes no difference that the mortgage under which the legal estate is outstanding is mentioned on the face of the plaintiff's mortgage: Duke v. Ashby (18). An order as to temporary

bars is, since the Judicature Act of 1877, unnecessary: Howard v. Howard (1).

An action for the recovery of land is a possessory action, and the judgment pronounced in the action is a judgment in personam, not in rem: Howard v. Howard (1). In such an action the real question for decision is the right to the immediate possession. This question sometimes depends for its solution upon the further question whether the equitable title of the plaintiff is superior to that of the defendant. In the case under discussion the defendants, who were mortgagors in possession, “as beneficial owners” conveyed all their estate by way of mortgage to the plaintiffs. Prior to the mortgage the right to the possession and the possession itself were vested in the defendants, subject to the right of the first mortgagee to recover on default of payment by the defendants; and until the first mortgagee took proceedings for recovery the defendants were legally in possession. Their conveyance vested the right to the possession in the plaintiff, subject as above-mentioned, and the conveyance by them “as beneficial owners” implied, under section 7, sub-section (c), of the Conveyancing Act, covenants for right to convey, quiet enjoyment, freedom from incumbrance, and further assurance. The defendants not having any equity as against the plaintiffs, under section 27 of the Judicature Act (Ireland), 1877, “if any plaintiff or petitioner claims to be entitled to any equitable estate or right or to relief upon any equitable ground against any deed, instrument, or contract, or against any right, title, or claim whatsoever asserted by the defendant … which heretofore could only have...