New Orleans Canal & Banking Co. v. Montgomery - 95 U.S. 16 (1877)
U.S. Supreme Court
New Orleans Canal & Banking Co. v. Montgomery, 95 U.S. 16 (1877)
New Orleans Canal & Banking Company v. Montgomery
95 U.S. 16
1. In the absence of proof to show when promissory notes were transferred by the payee, the law presumes that they were, when under-due, taken in good faith by the transferee without notice of any infirmity attaching to them, and he is entitled to the benefit of the deed of trust given to secure them.
2. The trustee named in the deed is, like a mortgagee, a purchaser for value. Both occupy the same ground with respect to notice, either actual or constructive, of any outstanding equities.
3. Where, therefore, the records of the proper office showed that in 1866, when the deed was executed, there was no prior encumbrance upon the land, held that a party claiming under a deed executed and recorded in 1848, which he alleges was intended to embrace the same land, but which misdescribes it, which misdescription was not asserted in any judicial proceeding nor notice thereof given before action commenced by the holders of said notes to enforce their trust, is not entitled to have his deed reformed against their intervening rights.
The facts are stated in the opinion of the Court.