Applewhite v. Nelms

Cooper, J., delivered the opinion of the court. In the year 1890 the appellee, Nelms, was the owner of a certain tract of land which he contracted.to convey to Charles Dunson and Cal Rodgers, upon the payment by them of the purchase-price agreed on. lie made to them a bond for title to said land upon the payment of the purchase-price, and delivered to them the present possession of the land. As a part of the contract between the parties, and written in the body of the bond, it was agreed that if the purchase-price .should not be paid as stipulated, then Dunson and Rodgers were to pay to Nelms, as rent, five bales of cotton per annum, and they executed a joint obligation to him for the payment thereof. After Dunson and Rodgers had received possession of the land, they made a parol partition thereof for occupancy, each taking the part he was to have as owner when the land should be paid for. The appellant rented from Rodgers the portion of the land set apart to Mm in the partition between Rodgers and Dun-son, agreeing to pay Mm, as rent thereof, one-fourth of the cotton and corn grown during his term. Dunson and Rodgers failed to make payment of the purchase-price of the land, so that, under the terms of their contract with Nelms, they became liable to pay to him five bales of cotton as rent for the year 1891. Dunson paid one-half of the cotton to Nelms, and the appellant paid to him, on account of said rent claim, the proceeds of one-fourth of the cotton he had ready for market, at which time he was interrupted by the levy of a distress for rent sued out by Nelms, and which was levied upon the remaining crop of appellant, and upon a portion of the crop of Dunson. Before the levy of the writ, Dunson had sold to the appellees, Hawkins & [485] McConnico, a part of his crop grown on the demised premises. In this condition of affairs the appellant exhibited his bill in chancery stating the foregoing facts, and alleging the insolvency of .Dunson and Rodgers, and averring that there was collusion between Nelms, Dunson, and Hawkins & Mc-Connico for the purpose of relieving Dunson’s crop of liability for more than one-half of the rent due to Nelms, and in order that the remainder of his crop might be applied by him to the payment of a debt he owed Hawkins & McConnico. On the bill an injunction was issued staying proceedings on the distress until final hearing. The case was tried on an agreed statement of facts, in which all charges of fraud and collusion were excluded, and which are, in substance, as above set forth. On hearing, the chancellor was of opinion that complainant was not entitled to relief, and dissolved the injunction and dismissed the bill, from which decree complainant appeals. By law the landlord has “a lien on the agricultural products of the leased premises, however and by whomsoever produced, to secure the payment of the rent . . . and this lien shall be paramount to all other liens, claims or demands upon such products.” Code 1892, § 2495. Nelms, the landlord, was entitled to secure the full payment of his rent, and must be paid in any event if the agricultural products grown on the premises are sufficient therefor. The crops grown by appellant were subject to the attachment of the landlord, but this liability existed not because he was debtor to the landlord, but because the crops were made liable by positive law. Dunson and Rodgers, who had by contract bound themselves for the payment of the rent, were, and continued to be, the debtors, and complainant, by reason of the liability of his crops, occupied the relation of surety for them. Obviously, these relationships existed between the parties in the view of a court of equity, and, this being the case, the consideration of a few controlling principles will lead to a correct solution of the controversy. [486] Nelms had as security for his rent not only a lien upon the property of the appellant, but also upon the crops of Dunson, one of the principal debtors. It is well settled that a surety may, by resort to a court of equity, compel the creditor first to exhaust the estate of the principal (Bowen v. Hoskins, 45 Miss., 183), and that a creditor having security from the principal debtor must preserve it for the benefit of the surety, who, upon paying the debt of his principal, has a right of subrogation to the securities held by the creditor. George’s Digest, Title, Principal and Surety, § 21 et seq. The lien of Nelms, the landlord, extended to the AA'hole crop groAvn on the premises by Dunson, and, by reason of the equity of the appellant, it Avas the duty of the landlord to exhaust that security or to preserve it unimpaired by any positive act on his part for appellant’s benefit. As between Nelms on the one hand and Dunson and Dodgers on the other, it Avould be but just that Nelms should maintain the equities of Dunson and Dodgers, as between themselves, by securing, if practicable, an equal payment of the rent from each; but there is no obligation, legal, equitable or moral, on the appellant to save Dunson harmless from the default of his co-obligor, Dodgers. If Nelms had Avaived his lien upon the cotton of Dunson, and consented that he might sell it to Hawkins & McOonnico, he could not go against them for its value, but to the extent of that value the appellant, the surety, would have been released. It does not appear that Nelms Avaived his lien upon Dun-son’s cotton, and Hawkins & McOonnico are therefore liable to him for the value of the cotton they bought from Dunson. Eason v. Johnson, 69 Miss., 371; Warren v. Jones, 70 Miss., 202. And this liability of theirs is a security which will be preserved to appellant, the surety of Dunson. All the parties being hoav before the court, complete relief may be granted in the present suit. The court should have decreed that out of the proceeds of appellant’s property that has been seized, the balance due by him to Dodgers should [487] be paid to Nelms; then, that the property of Dunson, seized under the distress, should be exhausted in payment of the rent; after this, Hawkins & McConnico should have been required to pay the value of the cotton bought by them from Dunson, and, if a balance then remained due to Nelms, the crops of appellant should have been sold for its payment. The decree will he reversed, and cause remanded, to. he proceeded with accordingly.