Harris v. American Bank & Trust Co.

ClarksoN, J. The question involved: Where a mortgagor placed an advance bid on property under trustee’s sale and makes deposit, as required by the clerk, and the property is readvertised and bid in by the mortgagor at the advanced bid, the mortgagor not complying with *609 tbe terms of sale, it is ordered resold by tbe clerk, and at tbe last resale brings $500 more than tbe advanced bid made by mortgagor, leaving $405.25 more to be applied to tbe creditors’ notes secured by third deed in trust, does tbe mortgagor lose tbe money be deposited in court for tbe advance bid? We think not. The' controversy again requires tbe construction of C. S., 2591. This section in regard to other matters has been frequently construed. See Banking Co. v. Green, 197 N. C., 534, and cases cited; Hanna v. Mortgage Co., 197 N. C., 184; Brown v. Sheets, 197 N. C., 268; Davis v. Insurance Co., 197 N. C., 617. Tbe part of C. S., 2591, relative to tbe present controversy is as follows: “In tbe foreclosure of mortgages or deeds of trust on real estate, or in tbe case of tbe public sale of real estate by an executor, administrator, or administrator with tbe will annexed, or by any person by virtue of tbe power contained in a will, tbe sale shall not be deemed to be closed under ten days. If in ten days from tbe date of tbe sale, tbe sale price is increased ten per cent where tbe price does not exceed five hundred dollars, and five per cent where tbe price exceeds five hundred dollars, tbe same is paid to tbe clerk of tbe Superior Court, tbe mortgagee, trustee, executor or person offering tbe real estate for sale shall reopen tbe sale of said property and advertise tbe same in tbe same manner as in tbe first instance. Tbe clerk may in bis discretion, require tbe person making such advance bid to execute a good and sufficient amount to guarantee compliance with tbe terms of sale should tbe person offering tbe advance bid be declared tbe purchaser at tbe resale. . . . Tbe clerk shall make all such orders as may be just and necessary to safeguard tbe interest of all parties, and be shall keep a record which will show in detail tbe amount of each bid, tbe purchase price, and tbe final settlement between parties.” B. Frank Harris, who placed an advance bid on tbe property sold under tbe second deed of trust, was required by tbe clerk, under tbe statute, to deposit with the clerk $250, representing five per cent increased bid and also $750 in addition, to guarantee compliance of bis bid. Upon a resale B. Frank Harris was tbe last and highest bidder at $6,000, and no increase bid having been filed in accordance with tbe statute a deed was duly tendered to him and bis assignee, and they refused to pay for said land, as tbe holders of tbe indebtedness secured by tbe fourth lien protested and threatened litigation over tbe right of B. Frank Harris to assign bis bid. Tbe land was readvertised under tbe second deed of trust, in accordance with tbe statute, and at tbe last resale bid in by Joel T. Cheatham for $6,500, who bad purchased tbe notes secured by tbe third deed of trust and who assumed tbe first lien and taxes, and tbe deed was duly made to him. Tbe last sale to Joel T. Cheatham brought $405.25, after paying expenses, more than tbe *610 B. Frank Harris’ bid. Joel T. Cheatham claims that the $1,000 deposited by B. Frank-Harris should be applied on the notes due Mm secured by the third deed in trust, balance due on his notes amounting to $2,860.29. 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. The land on resale, after paying expenses, brought $405.25 more than B. Frank Harris’ bid. After applying the proceeds of Joel T. Cheatham’s bid of $6,500 on the second lien and third lien, and after paying expenses, Joel T. Cheatham received a surplus of $405.25 over the $6,000 bid by B. Frank Harris. There was no loss sustained by Joel T. Cheatham, the holder of the notes secured by the third deed in trust. He obtained a deed for the land at the bid he placed on same. He paid $6,500 for the land, and after paying expenses and the second lien and crediting the balance on the third lien, he obtained as a credit on his notes $405.25 more than he would have gotten if B. Frank Harris had complied with his bid. No wrong has been done Joel T. Cheatham and no damage sustained by him, from the facts appearing in this case. Joel T. Cheatham, in law or equity, has no claim to the $1,000, under the facts and circumstances of this ease. The judgment below is Affirmed.