Davis v. Union Central Life Insurance

Brogden, J. Two questions of law are presented for determination : 1. Can a third party 'purchase notes secured by deed of trust, after a sale of the property, under power contained in the deed of trust and within the period of ten days for increasing the bid, and thereafter enforce the security? 2.'Was the receiver of the National Bank of Fayetteville entitled to a continuance of the cause for the purpose of permitting subsequent lien holders to be made parties to the suit? The first question must be answered in the affirmative. The record discloses that the land was sold under the first deed of trust held by the Union Central Lifé Insurance Company on 29 October, 1928. Thereafter, on 8 November," 1928, the LaFayette Bank and Trust Company paid to the attorneys of the Union Central Life Insurance Company all sums due by virtue of the execution and delivery of the notes and deed of trust. Thereupon the attorneys for the lien holder assigned and delivered to the LaFayette Bank and Trust Company the notes and deed of trust evidencing the indebtedness and forwarded the money to the lien holder, and the money was retained without question. ' Until the expiration of the ten days the Union Central Life Insurance Company, by virtue of having purchased the land at the sale, became “a mere preferred proposer until confirmation.” In re Sermon's Land, 182 N. C., 122, 108 S. E., 497. It has been expressly held by this Court in Cherry v. Gilliam, 195 N. C., 233, 141 S. E., 594, that a mortgagor can sell his interest in the mortgaged premises during the ten-day period described by C. S., 2591. If a purchaser of the land could acquire the title of the mortgagor during the ten-day period, by the same token a purchaser could acquire title to the notes and deed of trust held by the lien holder. Therefore, it necessarily follows that such purchaser of notes can enforce the security according to the tenor thereof. *621 Ordinarily, a continuance rests in the sound discretion of the trial judge. Massey v. R. R., 169 N. C., 245, 84 S. E., 1047. Furthermore, subsequent lien holders or encumbrancers are proper parties to a suit of foreclosure — certainly if they seek to become parties, but they are not necessary parties in all cases. Gammon v. Johnson, 126 N. C., 64, 35 S. E., 185; Barrett v. Barnes, 186 N. C., 154, 119 S. E., 194; Bank v. Watson, 187 N. C., 107, 121 S. E., 181. However, in the present case it is provided in the judgment that the commissioner appointed to sell the property should notify all junior lien holders “to show cause before this court -at the next term of court to be held after the sale, why each of said junior lien holders or judgment creditors should not be bound by the terms of this decree and sale, if any, to be held hereunder, as well as the price which may hereafter be offered for said property at public auction.” This decree, therefore, protected the rights of all parties concerned. The judgment is Affirmed.