Kuhn v. Bank

In Kuhn v. Bank, 74 Kan. 456, 87 P. 551 (1906), the plaintiff purchased real estate which was encumbered by three mortgages and two judgment liens, all of which were of record. The plaintiff agreed to pay off all of those encumbrances, but at the time of the action, there were two mortgages and two judgment liens still outstanding. The defendant asked the Supreme Court to apply equity to give him a lien position superior to that held by those who had liens on the real estate at the time he purchased it. The Kansas Supreme Court refused to do so and stated: "If, as it has uniformly been decided, a purchaser of either real or personal property is bound to take notice of the facts affecting the title to the property which the records of the county show, and which records the statutes provide shall be public notice, then it is quite immaterial whether or not Kuhn had actual knowledge of the existence of the judgments. In the absence of conduct on the part of the person who afterward asserts the facts shown by the records to the prejudice of the purchaser which prevents an examination of the records or induces the purchaser not to make such examination, it is negligence for a purchaser of either real or personal property to make the purchase without ascertaining the facts shown by the records which may affect the title to be acquired. In the absence of such fraudulent conduct the purchaser will be presumed to have bought with knowledge of all the facts which the records at the time would have disclosed. Equity cannot be invoked to relieve one from the consequences of his own negligence. ( Hargis v. Robinson, 63 Kan. 686, 66 P. 988.)" 74 Kan. at 458. The court refused to apply the doctrine of equitable subrogation and said: "Or, having paid the first and second, could he not claim subrogation as to both, in a suit to foreclose the third? Sufficient answer it is to say that the equitable relief of subrogation was not designed to aid speculation nor to relieve litigants from the consequences of their own negligence, ignorance or mistakes of judgment. ( Hargis v. Robinson, supra.) This equitable relief originated in the evident justice of substituting a surety who has been compelled to pay the debt of his principle to the place of the creditor as against other creditors affected by the transaction. It has on principal been extended to the relief of junior lien-holders who, to protect their own interests, have been compelled to pay off prior liens, and to other cases where natural justice required its application and where no violence was done to the legal rights of others." 74 Kan. at 459. At another point in the opinion, the court stated: "The decisions of this court have been liberal in allowing subrogation where any equity required it and no legal right of others was encroached upon, but in no case does it appear the court has gone to the extent demanded in this case. Whether Kuhn would have purchased the land had the judgment liens been brought to his attention, assuming he had no knowledge of them, is a question of pure speculation, as they were for small amounts. Being charged with the knowledge of these liens, and having no interest to protect, he must be held to have simply stepped into his grantor's shoes. When he paid off a mortgage that was prior to the judgment lien it had the same effect as if the payment had been made by the grantor before he parted with his title." 74 Kan. at 460-61.