Kirksey v. Mitchell

COLLIER, C. J. It is well settled, that both the vendor and vendee of lands, have their mutual liens, the former for the purchase money due, and the latter for what he has paid, if the con- - tract is rescinded, or from any other cause the money is to be refunded. [Foster v. The Trustees of the Athenæum, 3 Ala. Rep. 302; Hall’s Ex’r v. Click, 5 Ala. Rep. 363, and authorities there cited; 2 Story’s Eq. 462, et post; 1 Bibb’s Rep. 313; 4 Id. 239; 4 Litt. Rep. 169, 190, 196; 1 Id. 216; 3 Bibb’s Rep. 183; 4 J. J. Marsh. Rep. 169; 6 Monr. Rep. 199; 1 Mason’s Rep. 212; 7 Wheat. Rep. 46; 9 Cow. Rep. 316.] In the present case this rule is not controverted, but it is- contended that the decree in favor of Driver, for the purchase money, must be enforced against every distinct tract of land sold by him to Lane, according to the (.value of each ; and that as this has been rendered impossible, by the discharge of the land purchased by Berry from the lien, the complainant’s purchase must also be released upon paying a sum bearing a like proportion to its value. When different parcels of land are included in the same mortgage, aud are afterwards sold to different persons, each holding in fee- and severalty the pax-cel sold to himself; in such case, each purchaser is bound to contribute to the discharge of the common burthen, or charge, in proportion to the value which his parcel beai’s to the whole included in the mortgage. [1 Story’s Eq. 461.] It was accoi’dingly held, that where six separate lots of land were mortgaged, and the mortgagee afterwai-ds released [410] four of the lots from the mortgage, leaving the original debt as a charge on the others, that the two lots, (which had been transferred to third persons,) were chargeable with their rateable proportion of the debt and interest, according to the relative value of the six lots at the date of the mortgage. A creditor cannot, by any act of his, deprive the co-debtors, or owners of lands conveyed by way of mortgage, of their right of contribution against each other. [Stephens v. Cooper, 1 Johns. Ch. Rep. 423; see also, Id. 409; Morrison’s Adm’rs, et al. v. Beckwith, 4 Monr. Rep. 76.] This rule, it seems, is not confined to cases where the lien is created by a mortgage, deed of trust, &c., but extends to the vendor’s lien for the purchase money; and it has consequently been held, that an equitable lien on lands held by several persons should be enforced distributively against each, in proportion to his interest in the estate. [Poston v. Ewbank, 3 J. J. Marsh. Rep. 43; Stephens v. Cooper, 2 Johns. Ch. Rep. 430.] It may also be stated, as a well established rule in equity that when one person has a lien upon two funds, and another a posterior lien upon only one of them, the person having both liens will be compelled first to exhaust the subject of his exclusive lien, and will be permitted to resort to the other only for a deficiency. [Piatt v. St. Clair’s Heirs, 6 Ham. Rep. 233.] In Cheesebrough v. Millard, 1 Johns. Ch. Rep. 409, the Chancellor said, “Iadmit as a principle of equity, that if a creditor has a lien on two different parcels of land, and another creditor has a lien of a younger date on one of those parcels only, and the prior creditor elects to take his whole demand out of the land on which the junior has a lien, the latter will be entitled, either to have the prior creditor thrown upon the other fund, or to have the prior lien assigned to him, and to receive all the aid it can afford him. This is a rule founded in natural justice, and I believe it is recognized in every cultivated system of jurisprudence.’’ He considers it well settled in the English law, and cites cases to prove it. It is said in the same case, that if a creditor exacts the whole of his demand from one of the sureties, that surety is entitled to be substituted in his place, and to a cession of his rights and securities, as if he were a purchaser, either against the principal debtor or his co-sureties. And if a prior creditor has put it out of his power to make the cession, it seems that he will be excluded from so much of his [411] demand as the surety, or subsequent creditor might have obtained, if the cession could have been fnade. . But if the prior creditor, who has disabled himself from making the assignment, has acted with good faith, and without a knowledge of the rights of the other creditor, he is not to .be. injured by his inability to make the cession; for the doctrine of “ substitution rests on the basis of .mere equity and benevolence.” See also, Cullum v. Emanuel & Gaines, et al. 1 Ala. Rep. N. S. 23; 1 Story’s Eq. 472, et post, and cases cited in notes; Piatt v. Law, 9 Cranch’s Rep, 458; Read v. Simmons, 1 Dess. Rep. 552; Bank of Kentucky v. Vance’s Adm’rs, 4 Litt. Rep. 169; Taylor, et al. v. Porter, 7 Mass. Rep. 355.] Let this statement of principles and citation of authorities suffice to guide us to a conclusion in the present case. As between Driver and Lane, his vendee, the former might have enforced his - equitable lien against all, or any part of the land embraced by the sale; or he might have purchased of him one parcel for a less sum than Lane agreed to pay him for it, and have collected the residue of his debt from the other lands. Does a different rule apply as between Driver and his assignee, and a purchaser from Lane? Driver denies any knowledge of the right set up by the complainant until after his bill was filed, and his denial is not in any manner disproved; consequently it must be taken as true. The sale by Lane to Berry, as well ,as its confirmation by Driver, was made long before the institution of this suit, and upon principles of equity Driver should not be .prejudiced, tie was not bound to inquire what disposition his vendee had made of the lands, but might, with the assent of the latter, deal in respect to one parcel of it, as if he was still the proprietor of the residue. The sale by Lane to Berry, with the subsequent assent of Driver, might be treated as a repurchase by the látter,^ro tanto. . .The equitable right of the shb-vendees of land to compel the original vendor to exert his lien for the purchase money against the entire estate, that each separate parcel may be charged in proportion to its value, must, like the doctrine of substitution, have its foundation in equity and moral justice; and if the vendor without a knowledge of the right of a derivative purchaser, has disabled himself from thus proceeding, by an arrangement made with his vendee, in good faith, his lien cannot be impaired. A [412] rule the opposite of this, would be too severe, and in our judgment cannot be supported either upon principle or authority. Kirksey it is conceded, does not occupy a position more unfavorable than his assignor, and it may be admitted that every defence that was available against the decree before its assignment may still be made. It is not shown by the proof, that Kirksey took possession of any of the lands, until after he became a purchaser at the trust sale, under the deed executed by Lane for his benefit. His possession after that time, must be regarded as the possession of Lane, or rather as permitted by him. This is proved by the deed, which invests the trustee with the power of sale, and the evidence showing the execution of that power. The rents then, received subsequent to Kirksey’s possession under leases thereafter made by him, became his own property, in virtue of the deed and the consequent proceedings. It was clearly competent for Lane thus to stipulate with Kirksey; and as he himself would be entitled to the rents, without being required to account for them to his vendor, he might transfer the same right to another person. See Chambers, et al. v. Mauldin, et al. 4 Ala. Rep. 477. This view is conclusive to show, that the complainant is not entitled to the relief which he seeks; the decree of the Chancellor is consequently reversed, and the bill dismissed with costs.