Redfern v. . McGrady

ClabksoN, J. It has been held by this Court that C. S., 2591, must be strictly complied with. The supervisory powers invested in the clerk of the court over sales under a mortgage, deed of trust, etc., are not an ordinary judicial sale, but confined by the statute to sales, and resales under the power of sale contained in the instruments, and in accordance with the directions of the statute. Lawrence v. Beck, 185 N. C., 196. The facts are to the effect: That the advance bid deposited by Walter M. McGrady was $369.34, the amount plaintiff sued for in this action. In compliance with the statute, on 3 March, 1928, a resale was ordered, under C. S.j 2591, and the land sold on 19 March, 1928, and Walter M. McGrady was the last and highest bidder in the sum of $7,756.08. No advance bid in ten days from the date of sale, as was required'by the statute, was deposited with the clerk, therefore Walter M. McGrady was entitled to have title made to him for the property on complying with the terms of sale, and it was the duty of the clerk to issue an order and require the trustee to make title to purchaser. This was not done. The trustee, with the consent of the plaintiff, took the matter from out of the clerk’s jurisdiction under O. S., 2591, gave McGrady time and nothing was done' from the date of resale, 19 March, 1928, when McGrady was the last and highest bidder for the property, until 1 September, 1928. 0. S., 2591, supra, says (1) “If in ten days from the date of sale the sale price is increased, etc., . . . shall reopen the sale of said property and advertise the same,” etc. (2) “Where the bid or offer is raised as prescribed herein, and the amount paid to the clerk, he shall issue an order to the mortgagee or other person and require him to advertise and resell said real estate.” The ten days elapsed and no upset bid was put on the property, therefore McGrady became the purchaser. The statute *133 further provides, (3) “Upon the final sale of the real estate, the clerk shall issue his order to the mortgagee or other person and require him to make title to. the purchaser.” This mandatory provision was entirely ignored. A petition by the trustee was filed 1 September, 1928, before the clerk asking for a sale, not a resale, of the property and the land was ordered to be advertised and sold on 1 October, 1928. At this sale the plaintiff Helen B. Redfern became the last and highest bidder in the sum of $3,300. Report of sale was duly made to the clerk by the trustee. On 11 October, 1928, Walter M. McGrady deposited with the clerk 5 per cent advance bid — $165.00, and gave bond in the sum of $1,500 for the performance of his bid, as required by the clerk, and on that date a resale was ordered and the land resold on 19 November, 1928, and the plaintiff became the last and highest bidder at $6,500. A report was duly made to the clerk by the trustee and deed duly made to the plaintiff by the trustee by order of the clerk. On this sale the property brought $926.10 less than plaintiff’s debt and expenses. Plaintiff contends that the deposit of McGrady of $369.34 on 29 December, 1927, should be applied on her debt. We think, from the entire record, that plaintiff waived and abandoned her claim to the $369.34. Walter M. McGrady was the last and highest bidder for the land in the sum of $7,756.08. No upset bid within the ten days was deposited with the clerk as required by O. S., 2591, supra. This was a final sale, and under the act it was mandatory on the clerk to issue an order to the trustee and require him to make title to the purchaser. This was not done. If the purchaser had refused to comply with his bid, the $369.34 would have been applied to plaintiff’s debt if the land did not bring over his bid on a resale properly held under the statute. In Harris v. Trust Co., 198 N. C., at p. 610, it is said: “We think the claim of Joel T. Cheatham cannot be sustained. The money deposited by B. Frank Harris, under the statute, was a guarantee that there would be no loss occasioned if he be declared the purchaser at the resale; he was so declared and did not comply, but there was no loss, as the property brought more on resale.” In the Harris case the statute was strictly complied with. A deed was tendered Harris and he refused to pay for the land, and on a resale it brought over the debt due by Harris to Cheatham, the holder of the notes secured by the deed of trust. In the present case to have held the $369.34 as a guarantee, the statute must be strictly complied with. The rights of plaintiff are statutory, not equitable. The plaintiff is to be sympathized with, as she and her trustee were trying not to be harsh and by kindly treatment lost her statutory rights by not strictly following them. We must adhere to the law as written. *134 In Cherry v. Gilliam, 195 N. C., at p. 234-5, citing numerous authorities, it is said: “It is provided in section 2591 that in the foreclosure of the mortgages the sale shall not be deemed to be closed under ten days, and if within this time an increased bid is paid to the clerk the mortgagee, by order of the clerk, shall reopen the sale, advertise the property as in the first instance, and make a resale; and that upon the final sale the clerk shall issue an order to the mortgagee to make title to the purchaser. It has been held with respect to this statute that it was enacted for the protection of the mortgagees when sales are made under a power of sale without a decree of foreclosure by the court; that it confers no power on the clerk to make any orders unless the bid is increased; that in the absence of such bid no report is necessary, and that if an increased bid is paid, the clerk cannot make any orders until the expiration of ten days.” In re Bauguess, 196 N. C., 278; Hannah v. Mortgage Co., 197 N. C., at p. 187. Plaintiff and her trustee treated the bid of McGrady as a nullity. The clerk did not order the trustee to make title, and the trustee did not comply with the statute and tender a deed to McGrady. Not complying with the statute, the plaintiff lost what benefit she may have derived from the money deposited. The trustee started a new sale and the 19 March, 1928, resale was abandoned. The petition to the clerk to give notice to McGrady was without authority under 0. S., 2591. In fact, after the final sale to McGrady on 19 March, 1928, the new sale was started on 1 October, 1928, some six months after the final sale to McGrady; the subseqüent bid of McGrady and his making deposit and putting up bond and the resale in which plaintiff became the purchaser was a complete disaffirmance by McGrady and the plaintiff of the resale of 19 March, 1928, which the $369.34 was deposited with the clerk to protect. All these acts and conduct, as a matter of law, constitute a waiver and abandonment of. the resale of 19 March, 1928, under 0. S., 2591, which the $369.34 was deposited to protect. Plaintiff or the trustee had no lien or trust right in the fund of $369.34, under the facts and circumstances of this case. It was the property of McGrady and subject to attachment. To have a lien or trust right in the guarantee deposit on a resale, under C. S., 2591, the statute must be strictly complied with. The court below was correct in sustaining the demurrers. Affirmed.