Scott v. Reed

If one take or procure a conveyance of property, knowing at the time that the title is in another, though unrecorded, derived from the party with whom he treats, it is a fraud in him to take advantage of the want of registry to defeat the outstanding title by taking a conveyance to himself or to a third party. And if he subsequently conveys the property, or causes it to be conveyed, to an innocent purchaser for value whose conveyance is protected by registration, he will be liable in damages for the value of the property to the grantee in the unrecorded deed, because by such fraudulent acts the latter has been deprived of property which was rightfully his. Le Neve v. Le Neve, 1 Ves. Sr. 64; Ludlow v. Kid, 4 Ohio, 244; Robinson v. Boyd, 17 Mich. 128. These elementary propositions are decisive that the complaint in this action stated a cause of action, and ought not to have been dismissed. There is no force in the suggestion that Wooster, the immediate grantee in the unrecorded deed, and not plaintiff, was the party injured. Plaintiff had succeeded to the rights of Wooster by purchase of the premises at a foreclosure sale under a mortgage executed by the latter. Neither is it impor*343tant that the complaint does not allege that plaintiff- knew of the unrecorded deed when he purchased. The fact remains that he was deprived of property, lawfully his, by the fraud of defendant.

Judgment reversed, and new trial ordered.