1891. STARK V. STEPHENSON. Before KILLAM, J. Registration-Priority—Quit claim deed—Notice-Affidavit of Execution. A quit claim deed is within the Registry Act, and by registration defeats a Registration is effectual without an affidavit of execution by the grantee. Held, That there was not sufficient proof of actual notice to defeat B's. prior Held, also, That in order to bring abstinence from enquiry within the category of actual notice, there must be wilful abstinence and fraudulent determination not to be informed. ARGUED: 27th October, 1890. DECIDED: 19th January, 1891. THIS was an issue under the Real Property Act, which Statement. came on for trial before Killam, J., on the 27th day of October, 1890. The plaintiffs in the issue, Messrs. Stark & Isbister, applied to bring under the Act a certain lot in the townsite of Griswold, whereupon the defendant in the isssue, Mr. Stephenson, entered a caveat and filed a petition in support of his claim. The order for the trial of the issue recited that both parties claimed title under conveyances from one John McKay, who was admitted to have been on the 16th. of November, 1889, entitled to a conveyance in fee simple of the lands, upon payment of $21.85, from parties who may be called the Trustees, to whom the land had been granted by the Crown, and also, that it was admitted that the plaintiffs received from McKay an assignment of his interest in the land, dated the 16th of November, 1889, and 1891. Statement. filed the same with the Trustees at Winnipeg, on the 20th November, 1889. The question to be determined, was whether the plaintiffs, under and by virtue of this conveyance, acquired the interest of McKay in the land as against the defendant, to whom McKay made a conveyance on the 20th of November, 1889, which was registered in the proper registry office on the 21st November, 1889. It appeared that some weeks before the 16th November the plaintiffs' negotiations with McKay had been going on, and that a verbal arrangment had been made between them, by which McKay was to sell to them his interest for $280 above the amount due to the trustees. The first difficulty in the way of carrying it out was met in some claim or charge held by a Mrs. Lindsay. That appeared to have been released, and McKay desired to have the plaintiffs complete the bargain upon some guarantee by Lindsay, which, however, the plaintiffs were unwilling to accept. Stark and McKay then went to Brandon, where they placed the matter in the hands of a solicitor, Mr. Peterson, who was to be paid the purchase money and to investigate the title for the plaintiffs, and, upon its being found satisfactory, to pay over the money to McKay. Afterwards, Peterson drew up an assignment from McKay to the plaintiffs of the former's interest for an expressed consideration of $350, and sent it to Griswold, where McKay executed it on the 16th of November. Some claim was made for the defence that McKay was so intoxicated when he executed this instrument as to be entitled to avoid it, but in view of the previous negotiations and of McKay's subsequent demands of the purchase money, apart altogether from the weakness of the evidence respecting his condition, the learned judge held that this claim wholly failed. This assignment, with the purchase money, was sent to Peterson on the 18th November, and on the 20th he sent the former, with the balance due the trustees, to their office in Winnipeg, where it was received on the 22nd. On the 22nd November, Mr. Scarth, as managing trustee in charge of the office of the Trustees, wrote Peterson, acknowledging receipt of the amount and promising a deed in favor of Stark and Isbister as soon as it should be executed, unless the Trustees should find anything to prevent their delivering the same. The plaintiffs' assignment was never registered, but there was issued to them a deed of conveyance, executed by two of the trustees, and by Mr. Scarth, for the remaining two, under an alleged power of attorney not proved, this deed, bearing date the 20th November, though evidently executed later, being registered the 27th January, 1890. McKay appeared, however, to have become impatient of the delay in paying over his purchase money, and desiring to leave Griswold, for which purpose he had made the sale, he made another sale to the defendant, who states that he paid him $250. On the 20th November McKay executed, in favor of the defendant, an ordinary quit claim deed of his interest in the lands, for an expressed consideration of $350, which was registered on the 21st November. The plaintiffs' purchase money had never been paid over to McKay, owing partly to the defendant's transfer, and partly to some alleged garnishee proceedings. The plaintiffs took possession of the land and the house which is thereon, upon or after the 20th November, with McKay's consent, though whether before or after the defendant's purchase did not appear, but the circumstances seemed to render it probable that it was after that purchase; and they had since made improvements thereon, with knowledge of the defendant's claim. The defendant claimed priority for his transfer under the Registry Act, and the plaintiffs claimed that this transfer, being a quit claim deed was only a transfer of the interest which McKay had when he executed it, and consequeutly could not take effect as against theirs notwithstanding the registration; that the registration was defective, because there was no affidavit of execution by the grantee; that the defendant took, with actual notice of the transfer to the 1891. Statement. 1891. plaintiffs; and that they had the legal, as well as the Statement. equitable, estate, and were absolutely entitled to the land. H. M. Howell, Q.C., and W. J. Tupper, for the plaintiff, cited the following cases: Goff v. Lister, 14 Gr. 453; Needler v. Campbell, 17 Gr. 597; Wigle v. Setterington, 19 Gr. 512; Millar v. Smith, 23 U. C. C. P. 53; Tiffany on Registration, 229, 314; Wyatt v. Barwell, 19 Ves. 439; Cooley v. Smith, 40 U. C. R. 555; Severn v. McLellan, 19 Gr. 220; Boursot v. Savage, L. R. 2 Eq. 141. J. S. Ewart, Q.C., for defendant, cited the following cases: Waters v. Shade, 2 Gr. 457; Brennan v. O'Neill, 4 U. C. R. 8; Bruyere v. Knox, 8 U. C. C. P. 520; Major v. Reynolds, 2 U. C. R. 311; Bondy v. Fox, 29 U. C. R. 64; Lawrie v. Rathbun, 38 U. C. R. 255; Tiffany on Registration, 77, 410; McAllister v. Forsyth, 12 S. C. R. 18; Sugden on Vendors, 485; Hine v. Dodd, 2 Atk. 275; Jolland v. Stainbridge, 3 Ves. 485; Wyatt v. Barwell, 19 Ves. 438; Chadwick v. Turner, L. R. 1 Ch. 319; Hollywood v. Waters, 6 Gr. 332. KILLAM, J.-It appears to me that, by the execution of the first assignment, as between McKay and the plaintiffs, the latter became entitled to his interest in the contract with the trustees, and to acquire the land from them, subject to the condition that if they should not be able to acquire the land their purchase money was not to be paid over. As between them and the defendant, the plaintiffs were the first assignees of the contract, and have either obtained, or become entitled to obtain, the legal estate. Except, then, for the effect of the Registry Act, the issue must be found for the plaintiffs. Assignments of such interests, however, would clearly come within the Registry Act, so that a second assignment in proper form, if first registered, without notice of the previous one, would take priority, even though the first assignee should have completed the purchase and acquired the legal estate. I must confess that upon and before the argument in this matter I was rather inclined to favor the view which was apparently entertained by Vice-Chancellor Mowat, when he gave his judgment in Goff v. Lister, 14 Gr. 453, that such an instrument as that under which the defendant claims does not by registration defeat a prior unregistered grant of the interest of the same grantor. Now, however, after a careful examination of the cases decided in Upper Canada, I have come to the conclusion that this view is erroneous. In Doe d. Brennan v. O'Neill, 4 U. C. R. 8, it was decided that the Registry Act applied to sheriffs' deeds, and gave them, when registered, priority over previous unregistered transfers by the judgment debtor. This view was followed by the Court of Common Pleas in Bruyere v. Knox, 8 U. C. C. P. 520, and by the Court of Chancery in Waters v. Shade, 2 Gr. 480. In the latter case the question was examined wholly anew and discussed elaborately. The argument of Vice-Chancellor Spragge, especially, is very convincing, and it is distinctly applicable to such a deed of the grantor himself. He says, speaking of the sheriff's deed, "It differs, I conceive, in no essential particular from a conveyance by an individual of all his estate and interest in certain land, which would be all the estate and interest which he then had in such lands. A purchaser in either case would buy subject in effect to any prior deed which might obtain prior registration; but when he (such purchaser) registered, the prior deed was adjudged void, and, if void, then the grantor or execution debtor had an estate and interest in the land to convey at the time referred to." The remarks of the same learned judge in Goff v. Lister, and in Graham v. Chalmers, 7 Gr. 597, were evidently directed to the equitable defence of a purchase for value without notice, and not to the Registry Act. In our Registry Act, C. S. M., c. 60, s. 1, sheriffs' deeds. are expressly mentioned as within the term "instrument," and are thus brought within the clauses as to the effect of registration. This, in view of the form which such deeds 1891. Judgment. KILLAM, J. |