Case ID: nc_180/html/0021-01.html
Source: Caselaw Access Project
Author: {"author": "AlleN, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

MARTHA W. HARRISON v. C. M. DAW and Wife.
    (Filed 15 September, 1920.)
    Sales — Mortgages—Void Foreclosure — Resale—Title.
    ' Where, under the power of sale contained in a mortgage or deed in trust, the purchaser is judicially ascertained to have acted for and as the agent of the mortgagee, he and the mortgagee may again sell the land under the continuing power contained in the mortgage, without the order of court to sell, and convey the title to the purchaser at the second sale.
    Appeal by defendant from Oranmer, J., at the April Term, 1920, of Beaueokt.
    This is an action to recover possession of a certain tract of land.
    The defendants denied the right of the plaintiff to recover. .
    . Prior to 1914, the defendant Daw was the owner of said land, and on 23 May of that year he'and his wife executed a mortgage with power of sale to S. B. Windley to secure $187.50. After said debt became due, the land was sold under said mortgage and bought by E. A. Daniel, Jr., to whom the land was conveyed by deed on 17 December, 1917.
    The said Daniel brought an action against the defendants to recover possession of said land, and the defendants alleged that the plaintiff Daniel bought the land at the mortgage sale for, and as the agent of, the mortgagee.
    A decree was entered in said action in which it was adjudged that the said Daniel held the title to said land under the said mortgage in trust to secure the debt therein set forth, and upon the condition set out in said mortgage.
    The said Daniel and the said Windley, mortgagee, thereafter advertised said land for sale under the power contained in said mortgage, the same was again sold, and the plaintiff became the purchaser, and deed was executed to him for the same.
    The defendants on the trial in the Superior Court stated in open court that they rested this case on the legal question as to whether the foregoing deeds and mortgage conferred title on the plaintiff.
    The court held that the plaintiff was the owner of the land in controversy, and rendered judgment accordingly, and the defendants excepted and appealed.
    
      Small, MacLean, Bragaw <& Rodman for plaintiff.
    
    
      John G. Tooly and Harry McMullan for defendants.
    
   AlleN, J.

The determination of the question involved in this appeal depends on the right of a mortgagee to sell a second time after he has once sold the land under the power contained in the mortgage and executed a deed pursuant to the sale, when the first sale has been set aside.

•The minority rule seems to be that the mortgagee cannot resell the property, although the first sale is invalid and is upon the ground that upon the execution of a trust deed or mortgage the legal title passes to 'the trustee or mortgagee, and that any conveyance conveys his legal title, and that he retains no title which he can convey on a resale of the premises.

“The majority rule is that where the trustee named in a trust deed or mortgage, with a power of sale, has made an invalid sale of the property conveyed to him in the trust deed or mortgage, he may resell the property in accordance with the provisions thereof. Thus, in a case wherein it appeared that a sale of property by a trustee in a trust deed had been set aside by a court of equity on account of the insufficiency of the description of the property in the notice of sale, and that the trustee had resold the property, the Court held that the resale was valid, and that it was not necessary to obtain an order of the court therefor.” 19 R. C. L., 620.

Our Court bas adopted tbe majority rule. Brett v. Davenport, 151 N. C., 56.

Tbe case of Reeside v. Peter, 35 Md., 221, is directly in point. In tbis case tbe Court says.” “On a*former appeal between tbe same parties, 33 Md., 120, a previous sale made by tbe trustee was set aside on tbe ground tbat tbe property was not sufficiently described or designated in tbe public notice of sale given by tbe trustee; and tbe cause was remanded in order tbat tbe property might be resold, and tbe necessary steps taken in tbe court below for tbat purpose, in conformity witb tbe opinion of tbis Court. Tbe trustee thereupon proceeded to advertise tbe property again for sale, under tbe power contained in tbe deed, and tbe sale was made on 24 August, 1870, and a report thereof made to tbe Circuit Court.

“Tbe -first objection bas been mainly relied upon in tbis Court. It rests upon tbe ground tbat it was necessary, after tbe case bad been remanded, for tbe Circuit Court to pass an order directing a resale of tbe property, and tbat the trustee bad no power to sell without such order.

“In our opinion, such order was not necessary; tbe power to sell was conferred upon tbe trustee by tbe terms of tbe deed, and-no previous order of tbe court is necessary to enable tbe trustee to exercise it.

“In tbe former appeal, tbis Court considered tbe instrument as a deed of trust and not as a mortgage. Even if it be treated, however, as a mortgage coming within tbe provisions of tbe Code, article 64, and it be conceded tbat, after tbe sale bad been set aside, tbe case came within tbe operation of tbe 9th section of tbat article, still we do not understand tbe terms of tbat section as mandatory, requiring tbat a resale shall be ordered by tbe court. It would certainly be a safer and better practice to obtain such order; but tbe resale would not be invalid without it, nor is tbe want of it a good ground for setting tbe sale aside, if it be fairly made and free from objection on other accounts. Tbe power to sell in tbis case is not derived from tbe court, but from tbe deed; and as it may be exercised in tbe first instance, and tbe property sold without tbe court’s order, so it may be resold without such order, where tbe first sale bas been set aside.”

We therefore conclude tbat bis Honor held correctly tbat tbe plaintiff is tbe owner of tbe land in controversy.

No error.