Osin v. Johnson

Facts

The Appellant agreed to sell a parcel of land to the Appellee and to that end executed and delivered a deed, taking back a note for $30,000 representing the purchase price. The Appellee fraudulently represented to the Appellant that he would prepare, execute and record a trust on the property to secure the Appellee’s purchase money note, which the Appellee failed to do. The Appellee later borrowed $11,000 against the property by executing deeds of trust on the property to Perpetual, which Perpetual took without notice of the prior debt to the Appellant. The Appellee also borrowed $3,300 from Glorius, secured by second deeds of trust on the property. Thereafter, creditors of the Appellee obtained judgments, which became liens on the real estate by operation of statute. Foreclosure proceedings were brought under the trust deeds executed by the Appellee and the Appellant brought this suit for equitable relief, joining the trust holders, and the judgment creditors subsequently int ervened. The trial court, sitting without a jury, found that the Appellant conveyed title to the Appellee knowingly and in reliance on the Appellee’s assurances that he would record all the documents including the deed of trust, which secured the purchase money note. The trial court found that the trust holders and the judgment creditors had acquired interests, which were superior to that of the Appellant’s unrecorded claim. The Appellant appealed.