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Lee v. Beagell

New York Supreme Court
19 N.Y.S.2d 613 (1940)


Ms. Lee (plaintiff) purchased a property from Mr. and Mrs. Beagell (defendants). Lee received a deed for the property and took possession but failed to record the deed. A few years later, Lee borrowed a sum of money from the Beagells and gave them the deed to the property as security for the loan. When Lee failed to repay the loan according to the agreed-upon terms, the Beagells delivered a deed for the same property to George and Hazel Card (defendants). The Beagells informed Lee that if she repaid the loan within a set time, the deed given to the Cards would be destroyed and her deed for the property would be returned to her, but that if she failed to repay the loan, the Cards’ deed would be recorded. Lee failed to repay the loan in time, and the Cards’ deed was recorded. Lee sued the Beagells and the Cards, alleging that the transaction of giving the deed as security for the loan amounted only to an equitable mortgage in the Beagells’ favor. The Beagells claimed that they became vested in the property when Lee failed to repay the loan.

Rule of Law


Holding and Reasoning (Deyo, J.)

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