Ashton wished to raise additional capital for his business,and arranged with Banyon for a $10,000 mortgage on his estate,Blackacre.Ashton did not disclose the fact that he had previously borrowed $10,000 from Clayton by way of a mortgage,and Clayton had not registered his mortgage against the title of Blackacre.Shortly after the mortgage to Banyon was registered,Ashton conveyed the estate to Dayton,for $25,000.Dayton was unaware of the mortgages to Banyon and C,and did not examine the title to Blackacre when he registered his deed.Dayton was unaware of the mortgage to Banyon,and consequently,Dayton's title to Blackacre would not be subject to the mortgage.

Question

Quizplus · Accepted Answer

Ashton's failure to disclose the previous mortgage to Clayton and Clayton's failure to register his mortgage against the title of Blackacre means that Banyon's mortgage would be subordinate to Clayton's mortgage. Therefore, when Dayton acquired Blackacre, his title would be subject to both mortgages, including the mortgage to Banyon. Dayton would be responsible for paying off both mortgages.

Ashton Wished to Raise Additional Capital for His Business,and Arranged