COMMON LAW 225
actual notice of such instrument or matter but not necessarily of its contents.
(ii) Where inquiry is purposly avoided to escape being bound by notice.
John Towsey contracted for the purchase of certain property in 1776.
He borrowed the amount of purchase money from one Dr. P, and placed the title-deeds in his hands as a security for repayment.
In 1790, T was very much indebted to one Ellames in a considerable sum of money and executed a mortgage of the same property to Ellames.
Dr. P did not give any information of his claim to Ellames.
Ellames said that he made no inquiries after the title-deeds before he took the security, and admitted that upon executing the mortgage he inquired for them, and was informed of their being in the hands of Dr. P. but that he understood them to be so for safe custody only.
He received this information from one J. who was his brother-in-law, who had prepared the mortgage and appeared as his agent at the time of the execution of it.
Dr. P claimed priority over Ellames. It was granted as Ellames was held to have had notice.
(iii) Where there is gross negligence in not making usual and proper inquiries :
1899. 2 Ch. 264
1921. 1 Ch. 98.
Imputed Notice
- The underlying theory of agency is that a man can do a thing by an agent which he can do himself. Conversely, what is done by the agent is done by him. This being so, it is open to argument that what is known to the agent must be taken to be known