
    MILLER v McGUCKIN
    
      N. Y. Supreme Court, First Department, General Term,
    
    
      October, 1884.
    Action to set aside Conveyance and fob Accounting.—Foemeb Adjudication ; dismissal of complaint, and denial of motion TO SET ASIDE.—TRUSTS; CONVEYANCE AS SECURITY FOR DEBT J ACQUISITION OF TITLES BY GRANTEE,—MORTGAGE ; EQUITABLE ; BONA FIDE PURCHASER.—LACHES IN SUING.. Evidence; admissions; testimony on former trial.—Notice ; constructive.
    A judgment entered upon the dismissal of a complaint, because of the plaintiff’s failure to appear, where there was no trial of the action, and no consideration or determination of its merits is- not a bar to a subsequent action for the same cause.
    
    Nor is the denial of plaintiffs motion to set aside the dismissal of the complaint, made upon affidavits, without any investigation into the merits of the case. 
    
    The grantee in a deed, given as security for a debt, who has assumed • the obligation to protect the property for the benefit of the grantor by paying off the incumbrances, has assumed obligations entirely inconsistent with the right afterwards directly or indirectly to acquire' the incumbrances and through their forclosure endeavor to obtain an absolute title for himself.
    
    The grantee cannot claim the rights of a bona fide purchaser at a ' sale ori foreclosure, by acquiring such purchaser’s title, but he takes title subject to the same equitable rights as under the original deed.
    Whether the grantee holds the title as a mortgagee, or subject to a contract for its reconveyance at any time within one year if reimbursed his advances, the rights of the parties are the same, and, time not being of the essence of the contract, the contract may be enforced if there has been no unreasonable delay.
    Where the grantor died in 1858, before the expiration of the year specified in the contract, leaving the plaintiff, his sole heir, then about seven years of age, who brought an action in 1875 against the grantee’s executor, after she had attained the age of twenty-four years, and the grantee had neither presented his account of rents and profits received and payments made, nor demanded repayment under the contract: Held, that there had been no such laches on the plaintiff’s part as to deprive her of her rights or interests in the property, by virtue of the contract to reconvey, and she was entitled to be paid out of the grantee’s estate, any excess over advances received by him from the rents and profits, and a sale of the premises.
    There is no exacting or unyielding rule of law as to the evidence required to prove a deed absolute in form to have been merely a mortgage, but all that is necessary, is that the proof shall clearly and satisfactorily establish the fact.
    
    The defendant’s admission in a verified answer is equally admissible in a subsequent action after his decease by the same plaintiff for the same cause against his executor as it would, have been, had he survived and been a party defendant in the latter action.
    But the admission is not competent against the purchaser of the property in controversy from the defendant, the purchaser not being a party to the action.
    The testimony of a deceased witness given before a referee upon an ex parte application for leave tó sue as a poor person, is not admissible against the defendant in the action, since the defendant was not a party to those proceedings, and had no opportunity to cross-examine the witness.
    
    A purchaser is not chargeable with constructive notice of the infirmities of the vendor’s title, by reason of the equitable owner’s assertion of his rights in his answer in a foreclosure suit, if by the judgment therein it appeared that a sale of the premises had been regularly authorized, and title in that manner acquired by her grantor. The purchaser was not bound to look so far into the pleadings, as to inform himself of the contents of such answer, but only to consult the judgment itself.
    
    Nor is the purchaser chargeable with notice because of his agent’s knowledge of such infirmities of title, if he was not employed until. after the execution and delivery of the deed.
    Appeal from an interlocutory judgment for an accounting, and from an order permitting an amendment to the complaint in the action.
    The material fgcts appear fully in the opinions of the general and special term.§ From the interlocutory judgment directing an accounting, defendants appealed.
    Sarah Jane Miller brought this action against Henry
    
      J. McG-uckin, as executor of the' last will and testament of Henry McG-uckin, deceased, and others, as the heirs at law and devisees of Mary Qneripel, deceased, to annul a conveyance by plaintiffs father, Cornelius Doris, to said testator, and for a reconveyance to her by the heirs at law and devisees of Mary Queripel, to whom the testator had conveyed the property, and for an accounting as to the rents and profits, etc.
    
      
      Daniel P. Mahoney, for Henry J. McGhicken, executor, &c., defendant, appellant.
    
      Simon Sterne, for the plaintiff, respondent.
    
      
       By Code Civ. Pro. § 1209 this rule is extended to all final judgments (in certain courts) dismissing complaint in actions commenced thereafter. 7 Abb. N. Y. Dig. New ed. Supp. vol. 1. 1008, note 5.
    
    
      
       See, also, beside the cases cited in the opinion, Metropolitan, &c. R. R. Co. v. Manhattan Rw. Co., 14 Abb. N. C.103, 215, 233, 300; Veeder v. Baker, 83 N. Y. 156; rev’g 10 Weely Dig. 498; Alkus v. Rodh, 4 Daly, 397; Rogers v. Rochester, &c. R. R. Co., 21 Hun, 44; afi’d as Rogers v. Stephens, 86 N. Y. 623; Steuben Co. Bk. v. Alberger, 83 N. Y. 274; Chapman v. Phoenix Bank, 5 Abb. N. C. 118; Mather v. Parsons, 32 Hun, 338; Foreman v. Edwards, 15 Weekly Dig. 408; Mayor, &c. of N. Y. v. Ryan, 9 Daly, 316; Sibley v. Hastings, 16 Weekly Dig. 335; Winter v. Eckert, 4 Monthly L. Bul. 86.
      
    
    
      
       See, also, Wood v. Rabe, 96 N. Y. 414; Toole v. McKiernan, 48 Super. Ct. (J. & S.) 163; Harpending v. Munson, 91 N. Y. 650; Otherwise, if he only bought subject to incumbrances. Simms v. Voght, 11 Abb. N.C. 48.
    
    
      
       For the most recent cases on proving a deed to be a mortgage, see Manuf. Bank v. Ruger, 18 Northw. Rep. 251 ; Clark v. Angelí, 17 Weekly Dig. 29.
    
    
      
       See. Hall v. Bennett, 48 Super. Ct. (J. & S.) 302; Bradley v. Mirick, 91 N. Y. 293; aff’g 25 Hun, 272; Wolff v. Oswego, &c. Ins. Co., 17 Weekly Dig. 395.
    
    
      
       For the limits of this rule compare Dunn v. Hornbeck, 72 N. Y. 80; aff’g 7 Hun, 629; Heed v. Gannon, 50 N. Y. 345 ; Brumfield v. Boutall, 24 Hun, 451.
      § The opinion of the court below, Van Vobst, J., was as follows :■ The instrument in writing executed by McGuckin and Doris in February, 1858, contemporaneous with the deed from the latter to the former has not been produced. Its true character (and that is important), can only be derived from statements of witnesses with regard to its contents.
      On the plaintiff’s part, it has been called an instrument in the nature of a defeasance. That would characterize the relations between the parties, although there was an actual conveyance of the land, substantially that of mortgagor and mortgagee.
      Again it has been claimed on the plaintiffs behalf, that the instrument constituted McGuckin a trustee for the grantor, Doris, and, as he is dead, for the plaintiff, his only child, and that by its terms McGuckin is liable to account to her for the proceeds realized by him on the sale of the property, and to pay her what he has received over and above his disbursements, charges and commissions.
      In order to make out her case it was important to the plaintiff to prove the true character of this instrument as McGuckin’s right in the first instance arose from a deed absolute on its face.
      It is not entirely clear as to whom the custody of the instrument was committed in 1858. As it chiefly concerned the rights of the grantor, there was no reason why it should have been detained by the grantee. There is reason to believe that it was left with Ashley, the lawyer who drew it as well as the deed. It was proper that it should have been recorded with the deed, but it was not. Upon whom fault lies does not appear.
      Upon an ex parte hearing before Judge Mitchell in February 1859, Ashley testified that he had had the agreement, “ until some time ago ; when I delivered it to Mr. McGuckin.” But in that statement he was probably mistaken, as Mr. Wagner has testified upon this trial, that Ashley exhibited the instrument to him some years after-wards, and that it was then in a mouldy, or mildewed condition. That Ashley had told him “he had found it, he thought he had given it to McGuckin,” although the instrument was not produced before him and notwithstanding there was evidence of its existence, parol evidence was allowed to be given before Judge Mitchell on the plaintiff’s behalf, of its contents.
      Ashley testified that the time within which McGuckin was to be paid was limited by the writing. • But he did not state the time.
      
        McGuckin, in a written communication made by him to Judge Mitchell, and which is annexed .to his report, says that he would be satisfied if he received the amount of his advance and claims, the amount, of which he gave and which was the exact sum, as he stated, for which he had agreed to sell the property to Doris, provided it was paid to him on or before February 15, 1859 ; and he expressed himself as then willing, that the heirs of Doris, he being then dead, should have the residue of the proceeds; after he should have been repaid the cost of the property to him.
      As the deed from Doris to McGuckin bears date February 15, 1858, the time within which Doris had the privilege of repaying McGuckin, and of receiving back the property would seem to have been fixed at one year from its date. This is confirmed by the evidence of 'Wagner given before me, who said that the paper shown to him by Ashley fixed the time for payment and receiving a reconveyance at one year from its date. ‘ 1
      Judge Mitchell' must have been of that opinion from what appeared before him, for he says : “Time in equity is not generally of the essence of such contracts,” and that McGuckin “should have rendered an account, when demanded, which he did not do,” and he was of opinion that the infant daughter of Doris, the present plaintiff, had a cause of action against McGuckin, for an accounting, and for a reconveyance or sale of the premises.
      As already stated the proceeding before Judge Mitchell was ea parte upon a petition'in plaintiff’s favor in 1869 for leave to sue “in forma pauperis.’’
      But McGuckin is at least bound in equity by what he himself admitted before Judge Mitchell, whatever question there tnay be as to the evidence of Ashley in respect to the contents’of a writing then in existence, no legal steps having been taken to compel its production.
      I am of the opinion, upon a consideration of the evidence, that McGuckin was to hold the property, although absolutely conveyed to him, as security only for his advances, made and to be made, and as indemnity to him for his assumption of and his agreement to pay the mortgages upon the property amounting to $8,000 and upwards, with the privilege to the grantor of repossessing himself of the property, if not sold by McGuckin within the year, by paying of the' advances and discharging McGuckin from his liabilities oh account of the premises.
      
        The transaction possesses the elements of a mortgage with its rights, and in some regards those of an agreement to reconvey.
      But I do not consider it important or decisive in itself which view is taken. In either case Doris and the plaintiff, his sole infant heir, were clearly entitled to an account of McGuckin’s claims, before their interest in the premises and their rights to redeem the same could be cut off. All attempts either' to clog or defeat a right of redemption are disfavored in equity and will be unavailing. And although in the case of a conditional sale, strictly construed, the vendor can not come into equity to redeem, after default in tendering and paying on or before the day named in the deed, yet this court will not allow the right of redemption to be defeated by putting that which is really a mortgage in the form of a conditional sale, and will, on the contrary, when the real nature of the transaction is doubtful, incline to the former interpretation as better calculated to attain the ends of justice. Leading Cases in Equity, vol. 2, part 2 ( White & Tudor) note on Thombrough v. Baker, 1995.
      In no event could the light to redeem the property, or repossess himself of it by the grantor be exercised until an account was rendered. Such account McGuckin did not render within the year, either to Doris, in his lifetime, or to his heir, the plaintiff.
      And for that reason alone, Judge Mitchell’s decision, that she had a meritorious cause of action, was clearly right. And she would have been entitled to a reasonable time in which to pay McGuckin’s just claims, after the account had been presented and adjusted.
      Plaintiff was an infant; she could not protect herself and must needs depend upon others. She had no means of her own, and the disabilities attending her state of infancy make her claim upon the consideration of a court of equity all the greater.
      The right existing in the plaintiff, upon the death of her father, and to which she succeeded, was either to redeem the property, or to insist upon its reconveyance to her, upon discharging McGuckin’s claims, legal and equitable.
      The question now arises, have her rights been abandoned, lost or destroyed ?
      After the report of Judge Mitchell, which recognized her claims as meritorous, and in the year 1860, an action was commeneed in her favor by a guardian, ad litem, to obtain an accounting from McGuckin, and to enforce her rights, in substance to redeem the property.
      
        But in the year 1861 her complaint was dismissed, as I infer from the papers, through a failure on the part of her attorneys to prosecute the action. A motion was, however, afterwards made to set aside the default, and for leave to prosecute that action, which was denied, and afterwards this present suit was brought by the plaintiff upon her attaining her majority.
      Since this action was commenced, McGuckin has himself died. But several grounds of objection and defense to this action are urged by his counsel on his behalf and on that of his representatives and grantees, all of whom are made parties to this action.
      Among the objections is a title which McGuckin made under a foreclosure of one of the mortgages which was a lien on the property, at the time the same was conveyed to him by Doris, the payment of which he had assumed.
      But I cannot resist the conclusion that such foreclosure action was commenced and prosecuted in the interest of McGuckin and for the purpose of perfecting a title in him, freed from the rights legal and equitable which existed in favor of the plaintiff as the heir of Doris.
      That action was commenced in the name of one Borland, but I am well satisfied under the evidence that it was prosecuted for the purpose above mentioned, and to such degree it was a collusive proceeding.
      ' The plaintiff, then an infant, was made a party defendant to that action, and through her guardian ad litem interposed by way of answer her right to redeem the property or to a reconveyance, and demanded an accounting from her co-defendant McGuckin.
      But the subject of her answer was not litigated in the action, as it could not well have been, and a judgment of foreclosure and sale was entered therein, under which the property was sold and purchased by one Cain; but I am satisfied the purchase was made for and in the interest of McGuckin to whom Cain afterwards conveyed it. I can not conclude that plaintiff’s equitable right could, in that way and by such instrumentality be destroyed, and must hold that the title to which McGuckin succeeded by the deed from Cain was still subject to the plaintiff’s claims to redeem or to a reconveyance.
      It is further urged in behalf of the defendants, that McGuckin in the year 1860 rendered an account to some person who claimed to act for the plaintiff, and then offered to convey to her, Upon being paid the amount; and that such person pretended to make a tender of the amount of McGuckin’s account, but that it was a sham affair, and not a-true or honest tender.
      But it does not appear who the person was who claimed to represent the plaintiff on that occasion, or that he had authority to act for her or that he was in a position to understand or adjust McGuckin’s claims.
      Again it was claimed that the judgment dismissing her complaint in 1861 is a bar to this action, or at least furnishes a good ground to defeat her claims to an accounting from McGuckin’s representatives. But the answer to that objection is that the judgment is not upon the merits, but rests upon the default of her attorneys in failing to appear upon the call of the case.
      The merits have never heretofore been presented to the court for decision.
      The feebleness and vacillation with which plaintiff’s rights have been heretofore attempted to be brought to the notice of the court for adjudication, and the abortive effort to have them guarded and determined in the presence of a uniform and persistent policy against her, can not now be urged to defeat her equities, as she cannot be held responsible for them. She was not sui juris. There was always this disadvantage to be encountered, McGuckin was of full age and was represented by intelligent and skillful counsel earnest to protect him. But in presenting her claim and determining the method of its prosecution she had no voice.
      She is now, however, of full age and is able to present and insist upon her equitable and legal rights, and I cannot consider that any of the reasons urged by defendants are sufficient to defeat her claim for an accounting from McGuckin and his representatives with respect to the property received by him under the deed from Doris, as his position under the deed from Cain, can be no better under the circumstances above stated than it was before.
      Plaintiff is not estopped or barred by either the judgment in the foreclosure action, or that dismissing the complaint, nor by lapse of time, considering her infancy. Strictly and accurately speaking, no judgment can be available as an estoppel unless it is a judgment on the merits. Freeman on Judgments, § 260.
      
        Judgment of non-suit or nol. pros, of dismissal and discontinuance are under no circumstances deemed final. Id. § 261.
      In equity, there may be a dismissal of the complaint upon the merits after they have been presented, tried and considered; such judgment would be final without doubt, unless leave was granted to •sue again. But that is not the case.
      The judgment roll in the action in which her complaint was dismissed, says distinctly that “ this action having been called in its order on the calendar, and the plaintiff not coming, but making default thereof,” etc., “ now it is ordered,” etc., etc.
      In a case before Chancellor Kent, Rosse v. Rust, 4 Johns. Ch. 300, the decree relied upon as a bar was one dismissing a former bill because no one appeared on the part of the complainant at the hearing. The Chancellor said: “The merits of the former cause were never discussed, and no opinion of the court has ever been expressed thereon; it is, therefore, not a case, within the rule rendering a decree a bar to a new suit.” Sea Insurance Co. v. Day, 9 Paige, 246.
      In Ogsbury v. La Farge, 2 N. Y. 113, where a bill had been dismissed after “ publication was passed,” it was held the same in legal effect as though the case had been brought to a hearing on the pleadings and proofs.
      That was a suit, however, commenced in the late court of chancery, where the practice obtained of an order of “ publication for proof,” and which, when passed, no evidence was allowable. We have no such rule under the present system. See also Perine v. Dunn, 4 Johns. Ch. 142; Neafie v. Neafie, 7 Johns. Ch. 1.
      Nor can the denial of the motion to open the default and set aside the judgment entered thereupon, subsequently made, be urged as a bar to a new suit.' The merits of-the plaintiff’s cause of action can not be disposed of in that way.
      The decision of a motion is not res adjudícala as to a subsequent suit. Freeman on Judgments, § 325; Howell v. Mills, 53 N. Y. 322; Riggs v. Pursell, 74 N. Y. 370.
      The conclusion, therefore, which I reach is, that the plaintiff’s right to an account, and to a reconveyance of the property upon discharging the amount which will be found due to McGuckin or his-representatives upon such accounting, have not been impaired or ^destroyed, but are still in force and should be effectively secured to her through the judgment of the court, and to this end an accounting should be ordered.
      I cannot consider that equity inflicts any hardship upon McGuckin or his representatives by a judgment, which, while it protects the plaintiff according to the original understanding of the parties, will secure to him and his estate all that he has legally paid out for the property, and for its care and preservation.
      But these claims of plaintiff attached to the lands and will bind every person who took the estate from McGuckin with notice of the plaintiff’s equitable claims. Mrs. Queripel purchased from McGuckin, and she claims to have been a bona fide purchaser without notice.
      But I cannot consider that her position in this regard is well founded.
      There was enough in the record, through the lis pendens filed in the proceedings above mentioned,had they been examined, to have given; her notice, not only of the plaintiff’s rights, but that they existed in her favor during her infancy and that they had never been adjudicated. A man is bound, to make in good faith, a reasonable inquiry, and he is not at liberty to close his eyes, and will be affected with notice of all such facts as he might have learned from such inquiry.
      And if a person neglects to look into a title it will be considered; his own fault, and he must bear the consequences of his negligence. Svgdon on Vendors, pp. 356 and 550.
      Besides, the attorney who completed the examination of the title for her knew all about it, and she is chargeable with the knowledge, he had, upon principles quite familiar in courts of equity.
      The subject and eSect of notice of outstanding equitable rights in others, to one purchasing property, and of constructive notices between principal and agent is fully considered in Volume 2, part 1, Leading Cases in' Equity (White & Tudor), in a note to Le Neve o. Le Neve, pp. 117, 133. The cause there referred to charges Mrs. Queripel with plaintiffs equitable rights, with respect to the property she purchased and it must be held that she took the same charged therewith, and that they may be enforced against the estate in her hands or in those of her devisees or heirs.
      And I am sure that Mrs. Queripel may have had some misgivings of the subject of title, for her grandson Ashley testified on the trial before me “there was a large mortgage on this property; they were taking back a second mortgage, and we, of course, thought it was all right.
      “ Q. You thought you would be protected as to title, by giving back that second mortgage ?
      “A. Yes, sir; we had it five years without a notice of any trouble;” and again “I suppose grandmother was anxious to have a search of her property, if she wanted to sell it; we thought we were secured on the second mortgage.”'
      And as the plaintiff’s rights are herein recognized and fixed, and are to be completely enforced against the estate of McG-uckin, and the property in question, an accounting must be ordered.
      I have, in substance, approved the findings of fact and conclusions of law proposed by the plaintiff’s counsel, with amendments which I have made thereto. These express the facts arising from the evidence and the results. An engrossed copy should be served on each of the attorneys for the defendants, with the form of an interlocutory judgment proposed in pursuance of the above, which should both direct and limit the accounting, and define the specific relief, and the method of its enforcement, and which will be settled on due notice.
    
   Daniels, J.

The plaintiff, as the daughter and heir-at-law of Cornelias Doris, deceased, has prosecuted this action against the defendants, to secure the conveyance of a piece of land situated on the westerly side of Hudson Street in the city of New York. It was conveyed by her father, Cornelius Doris, to Henry McGruckin, by a deed executed on or about February 17, 1858. The grantor in the deed died in July, 1858, and in support of the action by the plaintiff it was alleged that it was executed and delivered to McGruckin as security for a small debt owing to him and such further sums as should be advanced by him for the payment of incumbrances on the property, and taxes and assessments.

This was denied by the defendants in the action, and the claim was made in their behalf, that the intention of the deed was to convey the property to Mc-Gruckin, who entered into an agreement to reconvey it at the expiration of one year, provided he was reimbursed for moneys which should be advanced upon it, and any other sum owing to him from the grantor. It was also alleged that default had been made in complying with these terms, and that the grantee in the deed had afterwards acquired the absolute title to the property under foreclosure proceedings in which they were afterwards sold and conveyed to Michael Cain, who-executed and delivered a deed of the premises to McGuckin. It was further insisted that the right of the plaintiff to maintain the action had been lost by the dismissal of a preceding suit brought by her against McGuckin and Gilbert E. Dorland.

The plaintiff was of the age of about seven years at the time of the decease of her father and commenced this action in the month of December, 1875, after she had attained the age of twenty-four years. The preceding suit was commenced by her in 1860. She was then in indigent, circumstances, and a guardian ad litem was appointed for her, and an attorney assigned to prosecute the action in her behalf as a poor person. That circumstance may account for the omission to bring the action to trial, for the proceedings which were taken in it disclose the fact that no trial of the issue was ever had, but in March, 1861, the complaint was dismissed in the absence of her attorney and. counsel. Judgment was entered upon the dismissal in June, 1865. In 1867, an application was made in her behalf to set aside the dismissal of the complaint; but upon the hearing of the motion it was denied, and it is this dismissal of the complaint and denial of the motion that has been relied upon as a bar to the present action. But the authorities cited in the opinion of the justice hearing and determining the action at special term are decisive against this defense. The denial of a motion made upon affidavits, without any investigation into the merits of the right relied upon, has not been considered by the courts to be a bar to an action brought by the defeated party afterwards for substantial relief. The denial of the application in this instance may very well, and probably did, proceed upon the delay intervening between the dismissal of the complaint and the application to set aside the default. It in no view involved any inquiry concerning the merits of the case, and was not an adjudication upon them, but all that was decided was that the default of the plaintiff upon which her complaint was dismissed, should not be vacated or set aside. The decision related to a mere matter of practice, and in no way prevented her afterwards from commencing another action for the redress to which she deemed herself entitled (Mack v. Patchin, 29 How. 20, 29 ; affirmed, 42 N. Y. 167 ; Easton v. Pickersgill, 75 N. Y. 599).

The judgment dismissing the complaint was no greater obstacle legally standing in her way. There was no trial of the action, no consideration or determination of its merits, but simply because she failed to appear and bring the case to trial, it was dismissed. That, under the present system, has not either at law or in equity been considered a defense to a subsequent suit (Rosse v. Rust, &c., Johns. Ch. 300; Burwell v. Knight, 51 Barb. 267).

The case is therefore before this court upon its merits, as it was held to be at the special term, and they are required to be considered in the disposition of the appeals.

When the deed was taken by McGuckin for the property, it was encumbered by three mortgages, amounting in all to the sum of $8,000. There were also judgments against Doris, the grantor, in the aggregate amounting to about $893.50. Of these judgments, one had been recovered upon a note given by Doris to McGuckin. That amounted, with costs, to the sum of $107.31. It stood in the name of Gilbert E. Dorland, to whom the note, was delivered, to be sued by Arnold H. Wagner, who is claimed throughout to have acted in this and other transactions, as the agent and attorney of McGuckin.

At the time when the premises were conveyed to the latter, they were probably worth the sum of about $10,000. And while it has been insisted that he made some payment to Doris on account of the conveyances, and Wagner as a witness stated that Doris had so admitted the fact to him, it is not probable that any such payment whatever was made by McGruckin for the property, for in proceedings which were taken on behalf of the plaintiff to ascertain whether a probable right of action existed in her favor for the recovery of the property, a reference was made in which McGruckin presented a voluntary statement as to his claims against the property, and to exhibit them, he presented a detailed account which, however, showed the payment of no money by him to Doris on account of the property. And it was found as a fact by the court at special term, upon evidence supporting that conclusion, that no such payment had been made by the grantee in the deed. He is to be held, therefore, as having received the property, subject alone to the encumbrances upon it, and he soon afterwards w?ent into the possession and enjoyed its control and management until he executed and delivered a deed of it to Mary Queripel, on June 1, 1868, for the sum of $20,000.

Neither of these encumbrances appears to have been paid by him, unless it might be the small judgment of $107.31 recovered by Dorland upon the note given by Doris to McGruckin. And that judgment was probably recovered in Dorland’s name for the benefit of McGruckin. For it was made to appear by the evidence of Wagner, who claimed to own the note, that supplementary proceedings taken by him for the collection of the judgment were dropped on the day when the examination was to have taken place, by reason of information received by him, that this deed had been made and delivered by Doris to McGruckin. And that probably would not have been done, as the deed would have been a violation of the order in the proceedings, had it not been for the fact that McGuekin himself was really the owner of the judgment.

And that he probably was so, is fortified by the charges made in the account already referred to, for payments for examining Doris, and afterwards drawing an assignment of the judgment. These circumstances, together with the fact that Wagner at the time appears to have 'been acting as the attorney for McGuekin, sustain the inference that the latter owned the judgment, although it had been recovered and stood in the name of Dorland, and that it was extinguished and" in fact satisfied through the conveyance of the .property made by Doris. The other judgments were neither of them paid by McGuekin, but they were cut off as liens upon the property by a foreclosure of the third mortgage, subject to which it was conveyed. This mortgage also was foreclosed in the name of Dorland. Before the- suit was instituted an action had been commenced by Joseph D. Baldwin, who was then the owner of this and a larger mortgage upon the property, for the foreclosure of such mortgages. That suit was arranged through the intervention of Mr. Wagner, and discontinued on the 5th of September, 1859. He obtained from Baldwin an assignment of the third mortgage upon the property, securing the payment of the sum of thirteen hundred dollars to Dorland, and stated that Dorland had paid the money for the assignment. And that, in form, he probably did, but that he obtained the assignment of the mortgage to foreclose it, and in that manner secure the collection of his small judgment is neither credible nor probable. For the judgment itself,. as already observed, was most probably the property of McGuekin and satisfied by the deed, and what was designed to be accomplished by the assignment and foreclosure of the third mortgage was the promotion of the interests of the latter by a further confirmation of the title claimed by him. This mortgage was assigned on the 8th of September 1859, and the action for its foreclosure was commenced on or about the 28th of the same month. The plaintiff was made a party to this action, and set forth by way of defense in her answer substantially the same facts relied upon to maintain this suit. But as they could not be considered and determined in an action for the foreclosure of the mortgage,x her answer was disregarded and a reference made to compute the amount due upon the mortgage. In the proceedings in the action Wagner was the active individual. He served the summons on the defendant McGuckin and other defendants in the action, and made proof, as the agent of the plaintiff, of the amount due and unpaid upon the mortgage. When the sale came to be made, Wagner was present and bid off the property for the sum of a thousand dollars in the name of Michael Cain, who, it is stated, refunded to Borland the amount paid by him for the mortgage, notwithstanding the fact that the purchase price of the property did not require that to be done. The sale under the judgment was made on the 10th of August, 1860, but the sheriff’s deed to Cain was not acknowledged until the 1st of December in that year. And on the day before that acknowledgment took place it is stated in the case that Cain executed and delivered a deed to McGuckin of the property, in consideration of the sum of fifteen hundred dollars. In the meantime, and until these deeds were executed, McGuckin remained in the possession of the property. Cain was not present at the sale, but Wagner bid off the property in his name, although he had not previously received any direct authority for that purpose. And he also, apparently acting for McGuckin, paid the interest upon the second mortgage on the property. Cain was a first cousin of McGuckin and the father-in-law of his executor, one of the defendants in this action. From these facts it was concluded by the court at the special term that the assignment of the mortgage had been obtained, and its foreclosure secured, for the sole object of placing the title to the property absolutely in McGuckin, free from the obligations assumed by him to protect it by paying off the encumbrances. And the circumstances were such, together with those connected with the suit upon the note and the evidence that Wagner was the attorney of McGuckin, although that fact was not unqualifiedly conceded by him, as fully to warrant that conclusion. Taking the facts together that Borland had no real interest in the property or either of the mortgages, and no substantial advantage to be derived from the foreclosure, the acts of Wagner, by which the original suit brought by Baldwin was discontinued, and this mortgage in form assigned to his friend Borland, the manner in which the proceedings were carried on, and the final result by which the formal title was vested in a near relative of McGuckin, who remained all the while in the possession and control of 'the property, and received a deed of it from the nominal purchaser contemporaneous with that of the sheriff, there was no reasonable ground for doubting that the design of the foreclosure was to cut off the plaintiff’s interest in the property and prevent her from recovering it from McGuckin, the grantee in her father’s deed.

And as he had previously undertaken to protect the property by paying off the encumbrances upon it, it was a fraud upon the plaintiff’s rights to take the title to it in this manner. There is no doubt, as the cases cited by the counsel for the executor hold, that a person holding a mortgage upon real estate, or claiming title to it by deed, may fortify and protect his title by buying in other encumbrances upon the property. But they are a class of cases entirely inapplicable to the controversy between these parties. For where the grantee in a deed made in this manner has taken upon himself the obligation to protect- the property for the benefit of the grantor, by paying off the encumbrances, he has assumed obligations entirely inconsistent with the right afterwards directly or indirectly to acquire the encumbrances, and through their foreclosure endeavor to obtain an absolute title for himself. He stood in the nature of a trustee whose duty it was to protect the property for another, and whose obligations to its owners were wholly inconsistent with the acquisition of the title in this manner. As to him and the executor claiming under him, the foreclosure and sale were fraudulent and entitled to no support in the judgment of a court of equity. The facts do not show that Cain was a purchaser of the property in good faith. In reality he did not buy it at all, but it was bid in and placed in his name by the person who at the time was evidently acting for Mc-Giuckin, and in the promotion of his interests. But even if Cain had been a purchaser of the property and had himself paid its purchase price when the title came back to MoGruckin, he held it subject to the same equitable rights as had been created under the original deed. When the estate was revested in him the original equities re-attached to it in his bands (1 Story Eq. Jur. [12th Ed.] § 410). To hold otherwise would enable a party desiring to defraud another effectually to do so under legal proceedings of a fictitious character.

The point is, therefore, fully presented whether McGluckin, received the deed by way of security for the repayment of the advances to be made by him including the judgment recovered by Borland, or subject to an obligation on the same terms to reconvey the property to Boris or his heir. The evidence of the witness Wagner upon this point was to the effect that the paper relied upon as a defeasance which was executed by McGuckin rendered the transaction a sale of the premises with a contract for their repurchase from McGuckin by Doris, while the answer of McGuckin himself in the preceding suit brought by the plaintiff to recover the property, substantially conceded the deed to him to have been executed for the purpose and by way of security. The following was the statement of McGuckin upon this subject.

Defendant admits “ that at the time of said conveyance the said property was about to be sold under a foreclosure of a mortgage, and that said Doris entered into an agreement with defendant to the effect that defendant was to pay the interest and costs claimed by the mortgagee and certain taxes and interest on two other mortgages ; and it was further agreed that said Doris should pay to said McGuckin all the sums of money this defendant had or should advance on account of said Doris, or on account of the maintaining and protecting said property with the interest thereon, and pay for defendant’s services collecting said rents and attending to said property, this defendant to account to said Doris for said rents in making up this defendant’s said charges and claims, and upon the payment of such balance due this defendant, this defendant was at any time before the 15th day of February'1859, to reconvey said property to said Doris.”

And it exhibited his understanding to be, that he in fact held the property as a security for what he should on account of Doris advance to relieve it from the encumbrance upon it. This was more than an ordinary admission; for the answer was verified by the person making it. It was his solemn statement under oath, that the title to the property had in this manner been placed in him, and as such it was equally as admissible against his executor, as it would have been against himself if he had survived and been a party defendant-in this action (Chadwick v. Fonner, 69 N. Y.404).

Authorities have been referred to, indicating the facts usually to be shown to establish a deed absolute in its form to have been merely a mortgage. But there is no exacting or unyielding rule maintained even by the authorities as to the evidence required to prove the fact. All that is necessary is, that the proof shall clearly and satisfactorily maintain its existence, and that they do in this case. McGuckin had no interest whatever himself in the property. He paid nothing for it, but took it to hold and manage for the benefit of Doris. It was fairly .worth something beyond the encumbrances against it, and all that McGuckin stipulated to secure to himself will be enjoyed by himself and his executor, even though the latter shall be held legally liable to account for the proceeds of the property. The case is one where, under the principle mentioned in Conway v. Alexander, 7 Cranch, 218, a court of equity would lean strongly against the title relied upon in favor of the grantee, and would endeavor to preserve and maintain the equitable rights and interests of the heir of the grantor in the estate.

And that may very well be done, even though the instrument called a defeasance was accurately described by Wagner as a contract for the re-conveyance of the estate upon the payment of the amount advanced to extinguish the encumbrances upon it. For if that did provide that the amount should be refunded at the expiration of one year from the time when the deed was delivered, the strict observance of the time so designated was not made an essential part of the agreement. Neither was it so considered by McGuckin himself, for after the year had expired, he expressed himself in the statement made by him to the referee, to whom the application of the plaintiff for leave to sue as a poor person had been referred, to be willing to surrender his right to the property upon being reimbursed the advances then alleged to have been made. And no proceedings whatever were at any time taken by him to extinguish the right of the plaintiff to a re-conveyance of the property, even if it was all she was entitled to insist upon. For, as has already been observed, those which were carried on for the foreclosure of the mortgage assigned to Borland cannot be allowed to have been effectual for that purpose.

Boris died before the year expired. The plaintiff was his sole and infant heir, and in her circumstances could not be expected or required to take effectual proceedings for the redemption of the property. Her disability continued until the year 1871, and, her final action to-vindicate and maintain her rights was commenced without unreasonable or fatal delay, after she had attained her majority. No such laches can be imputed to her as would forfeit her rights or interests in the property. And as time was neither made essential in the defeasance, nor insisted upon at any time by McGuckin himself, she was not deprived of her right to a specific performance of the defeasance as a contract to re-convey the property, by this intervening period of time. The rule upon this subject was stated in Hubbell v. Von Schoening, 49 N. Y. 326, to be that when time has hot been made essential and “ the delay . is excused, and the situation of the parties or of the property is not changed so that injury will result, and the party is reasonably vigilant, the court will relieve him from the consequences of the delay, and grant a specific performance.” “A party may be held to a strict performance as to time, and put in default for non-performance, that is, a default in law. And whether equity would relieve, would depend on circumstances. But to do this, the party seeking to put the other in default must not only be ready and willing to perform, but he must tender performance at the time, and demand performance from the other” {Id. 331). This McGuckin never did. He neither presented his account, showing the rents and profits received by him, or the expenditures made by him, nor called upon the other party to fulfill the agreement by refunding any sum which might have become due to him for advances he had made. And without a statement of account including such items, he was not in a situation to insist upon a settlement of any claims which might be made by him, or a forfeiture of the right of the equitable owner of the property to receive the title. The same principle was considered again in Merchants’ Bank v. Thomson, 55 N. Y. 7, where the law was in very nearly the same language reasserted.

The rights of McGruckin in the property underwent no change. The case differed from that of an owner of real property entering into a contract for its sale and conveyance. There he might well be entitled to the advantages of its enhanced value accruing after the time when the vendee was required to fulfill the agreement and take the title.

For all purposes the vendee in that case would be the legal and equitable owner of the property, while in the present instance that was not. the case. His interest and the extent of his right was to be reimbursed for his advances, and upon that reimbursement to convey the title. It was not contemplated in either form of the arrangement that he was to profit by the enhanced value of the property, but that was, in fact, reserved for the benefit of the grantor and his heir. The transaction in this respect was the reverse of that to be found where the absolute owner of property has entered into an agreement for its sale and conveyance, for this grantee was only entitled to hold the property to protect him against loss of the moneys he should advance. "Whether he held the title as a mortgagee or subject to a contract for its re-conveyance, the rights of the parties were essentially the same. And as long as complete justice may be meted out to his estate by reimbursing whatever advances he may have made with interest upon the amount, the plaintiff’s title to Jhe excess should be justly maintained by the judgment of the court, as that was done by the determination of the special term.

The proceedings before the referee under the application made on behalf of the plaintiff during her infancy to sue as a poor person were allowed to be given in evidence upon the trial. They included the testimony of Joseph C. Ashley, who is since deceased. These proceedings as well as this testimony were objected to as improper evidence in the case, and such they undoubtedly were. For McGruckin was not a party to those proceedings and was not, therefore, in a condition to cross-examine the witness Ashley. And where that right of cross-examination has not been enjoyed, the evidence of a deceased witness cannot be read against the party deprived of that right or those claiming under him in any subsequent portion of the proceedings. To entitle the former evidence to be read the opportunity for cross-examination must have been .afforded to the adverse party (1 Greenleaf on Evd. [7th Ed.] § 164; Jackson v. Bailey, 2 Johns. 17 ; White v. Kibling, 11 Johns. 128).

And if the action depended upon the weight or effect of this evidence or these proceedings, the judgment could not be maintained. But it does not, for the evidence given by Ashley upon the hearing before the referee stated the agreement which had been taken from McGruckin at the time when the deed was delivered, no more unfavorably to himself than he, Wagner, did in his evidence, or that he himself did in his sworn answer to the action brought in favor of the plaintiff as a poor person. It was cumulative evidence without really proving anything more than what was otherwise well established in the case.

As to the executor of McGruckin the right of the plaintiff to maintain the action was well established by the evidence, and it rendered him accountable for the proceeds of the sale of this property by the testator to Mrs. Queripel.

The other defendants in the action are the devisees of this estate. They have in form appealed from the judgment, and their notice of appeal has been made a part of the case, but no points or argument have been presented in their favor, and there may be a reason for supposing that they do not intend to insist upon their appeal. But that cannot be determined against them without evidence, and there is no evidence of their intention to abandon the appeal taken by them.

It becomes necessary, therefore, for the complete disposition of the case, to consider whether their testatrix acquired a title to the property through her deed from McGruckin. She seems to have purchased the property in good faith and to have paid a large portion of its purchase price and secured the payment of the residue by her bond and mortgage. This was all that was required to secure to her the rights of a bona fide purchaser, unless she was chargeable with notice of the infirmities in the title of her grantor. No actual notice was proven to have been received by her, and she can be charged with no constructive notice from the preceding litigation concerning the title to the property. Before her purchase, the plaintiff’s first suit had been dismissed and the inference from that circumstance, if it had come to the knowledge of Mrs. Queripel would be that she had no right or interest in the property.

And the contrary could not be inferred from the mere fact that she had again asserted the same rights in her answer, in the Borland foreclosure suit. For in tracing title to the property this grantee would have been under no obligation whatever to look so far into the pleadings in the foreclosure suit as to have informed herself of the contents of this answer. All that she could be required or expected to do, would be to consult the judgment itself. And when it thereby appeared that the sale of the property had been regularly authorized and the title in that manner acquired by her grantor, that would have been the extreme limits of her obligation to proceed by way of searching or tracing the title. The allegation of the plaintiff’s rights in her answer in that action could under no well settled principle be held to be even constructive notice of this purchase, for she was not bound to consult the answer at the peril of receiving an infirm title.

Neither was she chargeable with notice because Wagner was himself acquainted with the infirmities in the title and the manner in which McGuckin had finally acquired it. For Wagner sustained no such relations to her as attorney or agent as rendered her chargeable with his knowledge. She employed another person in what she did-to obtain the title to the property, and only employed Wagner after the deed had been executed and delivered to her. She stood therefore in no such relation to either of the parties, or the preceding proceedings as rendered her chargeable with the infirmity of title as it had been vested in McGuckin As to her and her devisees, the admissions made by McGuckin in answer to the plaintiff’s preceding suit were not admissible. . Neither, herself nor her devisees were in any form parties to that proceeding or secured the right or opportunity to cross-examine the witness, and what he swore to therefore as to the contract with McGuckin could not be lawfully received as evidence against them. As to these devisees the judgment was unauthorized, and it should be so far modified as to be reversed in their favor, and a new trial directed with costs to abide the event, unless the plaintiff shall stipulate to dismiss the complaint as to these defendants. .If such a stipulation be given within twenty days after notice of the decision, then the judgment should be modified by directing the executor of McGuckin to account for the proceeds of this property. And to that extent the hearing provided for by it should be had before a referee. But if the stipulation shall not be given then the further proceedings by way of an accounting will necessarily be deferred until the case is finally disposed of as to these additional defendants.

The order allowing the demand for relief in the complaint to be amended was entirely unobjectionable. The pleadings were well enough without it. The liability of the parties was not enlarged by its entry, but they were afterwards left practically for all the purposes of the action, as answers had been served, the same as they were before. As to this order there should therefore be an affirmance, but without costs to either party.

Davis, P. J., and Beady, J., concurred.  