Durden v. Whetstone

OLOPTON, J. The bill is filed by appellants, as the heirs of George W. F. Durden, against the administrators and heirs, of Mills Rogers; and seeks to redeem the lands described from a mortgage executed by Durden to Rogers, January 13,1873.. Durden died in March, 1881, and Rogers in July, 1888. The-bill is framed with a double aspect; the first being that there-was’ never any foreclosure of the mortgage, an attempted sale-under the power contained therein not having been consummated or carried into effect; and the second, that if there was such sale, the mortgagee became the purchaser at his own sale. The evidence shows that Rogers sold the lands under the' power of sale, on the third day of December, 1881, and that in its'execution all the pre-requisites to a sale under the power were complied with; notices of the time, place and terms of sale were posted as required, and- the sale was made at the place and in the manner prescribed in the mortgage — a regular sale. If it was made in good faith and carried into effect, it operated to cut oil' complainants’ equity of redemption as effectually as a strict foreclosure by decree of a court of equity,, unless the mortgagee became the purchaser, and the complainants have seasonably disaffirmed the sale, restoring the-relation of mortgagor and mortgagee. — Harris v. Miller, 71 Ala. 33. The first question then presented is, was Rogers the real' purchaser at his own sale ? The uncontradicted evidence shows,, that Livingston bid off the lands at the sale at the amount due on the mortgage, for himself and Saddler, by previous, arrangement between them, with which arrangement Rogers had nothing to do, except he agreed to give them reasonable time to make the payment. There was no other agreement or understanding with him in relation to.the purchase of the-lands. A few days thereafter, Livingston declined to take an. interest in the lands, and Saddler, his co-purchaser, took upon. [483] himself the entire bid. A short time afterwards, Saddler saw Rogers and told him that, as the lands did not join his, he would be unable to attend to them so as to pay the debt, and as Livingston had declined, .he wished him to take the lands at the bid, to which Rogers agreed. The tenants in possession had rented the lands for 1881 from the mortgagor before his death. It is not shown that Rogers claimed or received any of the rent for that year, and all the tenants testify that he made no contracts for rent for 1882 until the first day of January, /which evidently was after'he had taken the lands from Baddler. Either Livingston or the tenants are mistaken, as to the time when Rogers rented the lands. Not only is the presumption in favor of the mortgagee’s fulfillment of his trust, but the uncontradicted evidence of unimpeached witnesses clearly shows, that there was no arrangement or understanding by which the lands were to be purchased for Rogers, or that he would take them subsequently; that the sale was made in good faith to Livingston and Saddler, and was treated and acted on by Rogers and Saddler as valid ; and that his re-purchase of the lands was not contemplated at the time of the sale. Unquestionably, had there been any previous arrangement for a reconveyance, the title would have been voidable: but the mortgagee’s trust terminated on a sale being made in good faith to a third person, and he may purchase from him. 2 Jones on Mortg., § 1876. Livingston having declined to complete the purchase, so far as he was concerned, Saddler as a co-purchaser was not compelled to repudiate it, but could take the entire interest in the lands; and Rogers, having to apply the amount bid to the payment of the mortgage debt, could lawfully purchase from him, taking the lands in payment of the purchase-money. But appellants further contend, that though the sale may have been regular, and a third person the purchaser, a consummated sale is essential to cut oif the equity of redemption; and no deed having been executed, nor any part of the purchase-money paid and possession taken, so that either party could maintain a bill to compel specific performance, the right of complainants to redeem is the same as if there had not been an attempted foreclosure. This is not an open question in this State. It is well settled that, though the mortgage provides that the sale shall be for cash, an agreement of the mortgagee to allow time to the purchaser affords the mortgagor no ground of complaint. Such arrangement does not injure, but benefits him, its tendency being to enhance the price. The extent of his equity is to have credit for the sum bid as cash. Mahone v. Williams, 39 Ala. 202. Also, that the mortgagor [484] can not avail himself of the defense that the sale, resting in parol, is void under the statute of frauds. Such sale being-voidable only, and this defense personal, it is obligatory on the mortgagee and the purchaser so long as they treat it as binding — a deed or note or memorandum in writing is not essential. — Cooper v. Hornsby, 71 Ala. 62. And in Mewburn v. Bass, 82 Ala. 622, the following propositions, it is' said, are settled by the case last cited: '■'■First. If a sale under a power in a mortgage is regular, even though no conveyance is made, it cuts off the equity of redemption, and reduces it to a. mere statutory right. Second. If there be no writing signed to take the contract without the statute of frauds, only the mortgagee and the purchaser can take advantage of the omission. Third. The payment of the purchase-money is a matter between the mortgagee and the purchaser, which they can arrange to suit, themselves. The mortgagee has no other interest, than that he obtain credit and benefit of the amount bid.” The sale-having been regular, and a third person the purchaser in good faith, all the objections urged are covered by the foregoing-propositions, and it effectually cut off complainants’ equity of redemption. Affirmed.