Brown v. British & American Mortgage Co.

Cox, J., delivered the opinion of the court. This was a suit in the chancery court of Amite county by W. B. Brown against the British and American Mortgage Co., [397] and others, seeking to have a sale and deed of conveyance of certain lands to the said British and American Mortgage Oo., made by M. H. Wilkinson, as substituted trustee in a deed of trust given by said W. K. Brown, to secure to said British and American Mortgage Co. certain sums of money therein mentioned, held for naught; for an accounting; for a resale, if complainant failed to pay all that might be found due the said British and American Mortgage Oo.; and for general relief. Defendants answered, denying the grounds set up as warranting the relief prayed. The relief prayed was denied, and bill dismissed. Appellant, who was complainant below, insists that the sale was void, because the instrument appointing Wilkinson as substituted trustee, purporting to be the act of a corporation, was not under seal, and appeared to have been executed by two directors of the corporation instead of an officer; because it did not appear of record in the office of the chancery clerk of Amite county before the sale; because the land, about nine hundred acres, was sold in bulk, not having been first offered in subdivisions of not exceeding one hundred and sixty acres; because there was not that fairness, impartiality, and good faith upon the part of the substituted trustee which the law exacts of trustees; and because the price realized at the sale was inadequate. ■ The substitution is not void because not under seal. It is not a conveyance, but the mere exercise of a power of appointment. Agency for a corporation may.be proved as for a natural person, and authority conferred by it may be implied as in other cases. Carey-Halliday Lumber Company v. Cain, 70 Miss., 628 (13 South. Rep., 239). We do not find it necessary to determine whether directors Shattuck and Graham had authority to execute for the British and American Mortgage Oo., and in its name, the instrument of substitution. This authority, never denied by the corporation — indeed, made the basis of their claim of title to the land [398] in controversy — -was not controverted by appellant in the court below. The bill prays, among other things, that M. H. Wilkinson (substituted trustee) be required to disclose specially under what power or authority he proceeded to sell complainant’s land. Responding to this demand for discovery, the answer avers “that the British and American Mortgage Oo., Limited, did, on December 19, 1898, by their written instrument, appoint M. H. Wilkinson substituted trustee,” etc. The answer was duly sworn to by M. H. Wilkinson. This brings the case squarely within the rule that a sworn answer directly responsive to interrogatories in the bill is to be accepted as true unless disproved. Fulton v. Woodman 54 Miss., 158; 1 Ency. Pl. & Pr., 914. A careful inspection of the record discloses no offer of evidence by complainant to meet the burden of proof, and disprove the claim of Wilkinson that he acted for the British and American Mortgage Oo. under authority conferred by their written instrument. But if such evidence had been offered, it would not have been competent. The instrument of substitution was set up in defendants’ answer, and, indeed, was made the basis of their claim of title. Its execution could not be brought in issue until denied on oath, which was never done. Code 1892, § 1197 (this section applies to chancery courts); Code 1892, § 1810; Wanita Mills v. Rollins, 15 Miss., 253 (22 South Rep., 819). The due execution of the instrument appointing Wilkinson as trustee is conclusively established by appellant’s failure to controvert Wilkinson’s sworn answer responsive to a special demand for discovery, and by appellant’s failure to deny under oath the execution by the British and American Mortgage Oo. of the instrument substituting Wilkinson as trustee, said instrument having been pleaded or set up by defendants. Appellant insists that there is no evidence to show that the instrument of substitution was delivered to the clerk of the chancery court for record before sale; that, in fact, the averment in the bill that it was not recorded before sale was not [399] denied, and Renee was conclusively established; and that, therefore, defendants’ title must fail. The averments of the bill on this point are as follows: “Ho substitution appears of record in the office of the chancery clerk of Amite county, the county wherein the land is situated, either by separate instrument or otherwise, as required by the act of the legislature of March 3, 1896, requiring the same to be recorded before sale; and none was recorded before the sale nor after the sale, nor is there any recorded now.” Defendants, in their answer, “deny that M. H. Wilkinson, F. B. Hoffman, and the British and American Mortgage Co. failed and neglected to record, as required by law, the instrument or other thing substituting M. H. Wilkinson as trustee,” and aver that the instrument was filed for record February 6, 1899, and was recorded in conveyance book 37, p. 242. This is a sufficiently explicit denial to put the matter in issue, and cast upon complainant the burden of proof. This he did not meet. On the contrary, the testimony of M. H. Bates, chancery clerk of Amite county,'shows that the instrument substituting Wilkinson as trustee was filed with him at 10 a.m. on February 6, 1899, which was the day of sale. If this was true — and it is nowhere denied — the most that could be said would be that the sale was cotemporaneofis with the delivery, for by the terns of the deed of trust the sale must be made between 10 a.m. and 3 p.m. But from the record it appears reasonably certain that the sale followed the delivery to the clerk of the instrument of substitution. If, upon delivery to the clerk of the instrument of substitution, the said instrument appeared of record in his office, then ch. 96, p. 106, Acts 1896, was fully complied with, because the sale, even if exactly cotemporaneous with the delivery, was not made until the instrument appeared of record. It remains to be determined, then, whether the substitution “appeared of record” from the time of its delivery and before it was transcribed upon the record book. It undoubtedly was of record, from the time of its delivery, for all purposes.. It [400] then became notice to all the world of its contents. Any one investigating land titles must not only examine instruments actually transcribed upon the record books, but must also call for and examine instruments filed for record, though not actually transcribed. Such instruments are accessible to all, are as easily examined as those actually copied into the books, and, equally with the latter, appear of record within the meaning of the law. This is a reasonable construction, and saves the legislature from the imputation of folly in demanding more for the recording of an instrument substituting a trustee than of the deed creating the trust. The sale of the land in bulk was in pursuance of a provision of the deed of trust. The code provision requiring land sold under trust deeds to be offered in subdivisions not exceeding one hundred and sixty acres may be waived by the parties. It is intended to secure the property rights of individuals, and there is no public policy which would be defeated by permitting the parties in interest to waive its provisions. Cooley’s Const. Lims. (7th ed.), 250. We find no unfairness, partiality, or want of good faith on the part of the substituted trustee. Mere inadequacy of price will not avail to set aside a trustee’s sale. The decree was right on the facts of the case. Affirmed.