Case Name: D. C. Roddy & Co. vs. S. S. Elam and others
Court: South Carolina Court of Appeals
Jurisdiction: South Carolina
Decision Date: 1866-05
Citations: 13 Rich. 343
Docket Number: 
Parties: D. C. Roddy & Co. vs. S. S. Elam and others.
Judges: Wardlaw and Inglis, J. J., concurred.
Reporter: South Carolina Law Reports
Volume: 47
Pages: 343–348

Head Matter:
D. C. Roddy & Co. vs. S. S. Elam and others.
Equitable Title to Land — Judgment—Lien—Mortgage— Sheriff's Sale — Practice—Amendment.
Where one holds land under a contract to purchase, his equitable title is not subject to the lien of a judgment against him, hut may he transferred hy way of a mortgage.
Where one having such a title mortgaged the land, and it was after-wards sold by the Sheriff under executions against the mortgagor, one of which was older than the mortgage, on bill against the original vendor, who had been paid his purchase-money, the mortgagor, and the purchaser at Sheriff’s sale, who was in possession, it was held, that the mortgagee was entitled to have the land sold to satisfy the mortgage.
During the trial of the case the Chancellor permitted the plaintiff to amend his hill by making the original vendor a party defendantheld, that his discretion was properly exercised,
BEFORE CARROLL, CH., AT YORK, JUNE, 1861.
This carie will be sufficiently understood from the circuit decree, wliicb is as follows:
Carroll, Oh. By their bill the plaintiffs, who- are merchants and partners, seek foreclosure of a mortgage of land executed to them by the defendant, S. S. Elam. At the date of that instrument Elam was in possession of the premises under á contract of purchase with the proprietor, A. T. Black, to whom be had executed bis promissory note for the price, and from whom be bad received a bond for the title upon payment of tbe purobase-money. Subsequently to the contract tbe purchaser, Elam, erected upon the premises a bouse with other improvements, worth in the whole some four or five hundred dollars. In October, 1858, tbe purchase-money remaining wholly unpaid, by agreement among the parties tbe plaintiffs satisfied Black bis demand against Elam, and that sum being added to their other debts against him, Elam thereupon made and delivered to the plaintiffs his obligation for the aggregate amount of his indebtedness to them; and to secure the same also executed the mortgage already referred to. Simultaneously with the execution of the mortgage, Elam delivered to D. C. Eoddy Black’s bond for the title, with a written assignment of the same under his hand and seal.
Black, the vendor, is one of the attesting witnesses to the mortgage, and appears to have been present, cognizant of the transaction, and assenting to it. The plaintiffs having-recovered a judgment for their debt against Elam, sued out an execution of fieri facias, which was lodged with the Sheriff on the 6th of February, 1861. The premises comprised in the mortgage were levied on under that execution, were advertised as for sale under executions at the suit of Eoddy & Co., and others, were exposed to sale by the Sheriff on the 4th of March, 1861, and at such sale were struck down to the defendant, J. N. McElwee, Jr., as the highest bidder,' at the price of $55. In the Sheriff’s conveyance to McElwee it is recited that the sale was made by virtue of the execution at the suit of the plaintiffs. At the date of the Sheriff’s sale there were other executions in his office against Elam, and among them one at the suit of McLure & Harris, senior to the mortgage. On the 6th of October, 1858, the day succeeding its execution, the mortgage was recorded in the Eegister’s office, and on the day of sale the plaintiffs, through their attorney, gave public notice to the bystanders of their mortgage and its amount, and that the purchaser would buy subject to that incumbrance. This announcement was made in the presence and hearing of McElwee. After the Sheriff’s sale, Elam surrendered the premises to McElwee, who thereupon passed into the possession, and still retains it.
It is indisputable that McElwee acquired no interest whatever by his purchase from the Sheriff. Elam owned no estate in. the land subject to levy under execution from a Court of law. Though there had been no precedent transfer of Elajn’s equitable interest, yet McElwee could not have constrained the vendor, Black, to convey to him the legal title on payment of the purchase-money. Richards vs. McKee, Harp. Eq. 184. Still McElwee is in the occupancy of the premises by the act and with the consent of Elam, and may, therefore, urge all objections which the latter might have taken to any proceeding that might result in his dispossession.
It is contended that the mortgage is void because of the absence of all legal interest in the mortgagor. When a contract is made for the sale of land, the vendor becomes a trustee for the vendee, and the equitable interest of the latter is devisable and descendible as if it were real estate.
“ If the- vendee, under such a contract, conveys the same to 1 a third person, the latter, upon paying the purchase-money, may compel the vendor and any person claiming under him in privity, as a purchaser with notice, to complete the contract, and convey the title to him.” 2 Story Eq. sec. 1212 and 788 ; Wilbanks vs. Duncan, 4 De S. 539. As the vendee may dispose of his equitable interest absolutely, it would seem to follow of necessity, that he may carve out of it an interest of less quantity, by creating a defeasible estate, which is essentially the character of that is vested in a mort-* gagee. The mortgage in question, if defective in other respects, at least furnishes evidence of an agreement between the parties for that specific security. Mortgages of this class entitle the mortgagee to claim specific performance, and the execution of a legal mortgage. Adams Eq. 123. An agreement for a specific lien will be enforced, but not a contract for a general security to the prejudice of other creditors. Johnson vs. Slawson, Bail. Eq. 465; Lamar vs. Simpson, 1 Rich. Eq. 78; Massey vs. Mcllwain, 2 Hill, Ch. 428. “ The anguage of all the books is, that an agreement to mortgage is an equitable lien, and lias precedence of a subsequent' judgment and all general creditors.” Dow vs. K&r, Sp. Eq. 417.
It is further objected that there was no consideration for the assignment of the bond for title; that neither at the sale, nor before, did the plaintiffs set up any claim under it; that the fact of the assignment was not even disclosed by them at the sale, but was on the contrary dishonestly concealed; and that to allow them any advantage whatever from that source would subject McElwee to all the consequences of a fraud. The whole argument seems to be founded in misconception. The plaintiffs claim by virtue of that assignment no absolute transfer of Elam’s interest as vendee. They are not understood as pretending to be invested under that assignment with any interest whatever independent of, or additional to, that belonging to them as mortgagees. The assignment is not to be regarded as a transaction separate and distinct from the mortgage.
On the contrary, it was incidental to it merely, and must have been intended only to confirm and render more effectual that security. Indeed it may well be doubted whether the interest or rights of the plaintiffs were in the slightest degree augmented or enlarged by the assignment in question, beyond the increased facility in asserting them resulting from the possession of the bond as a mere instrument of evidence. It is true that the assignment is made to D. 0. Eoddy, individually, but he claims no separate interest by virtue of it. In the whole transaction, of which it is parcel, he represented the mercantile firm of which he was a member, and must be regarded as having received the assignment for their benefit as mortgagees. It has not been suggested that any payments have been made upon the plaintiffs’ judgment at law against the defendant Elam, and a reference to ascertain the sum due upon the mortgage debt may therefore be dispensed with.
The vendor, A. T. Black, was not made a formal party to this proceeding; but, by writing indorsed upon the bill and subscribed by him at the hearing, he “ acknowledged himself to be in Court, waived the right to answer, and consented that the cause be heard.” He may be regarded therefore substantially as a party defendant.
It is ordered and decreed, that unless the mortgage debt, as ascertained by the plaintiffs’ judgment at law against the defendant S. S. Elam, with interest, and the plaintiffs’ costs in this suit, be paid to the said plaintiffs by the first day of January next, then that the said Elam stand absolutely debarred and foreclosed of and from all equity of redemption of and in the said mortgaged premises, and that the same be sold by the Commissioner at public auction, after due notice, at Yorkville, on the first Monday of some month succeeding January next, to be appointed by the Commissioner, on a credit of four months from the day of sale — the purchase-money to be secured by bond with adequate securities; and that out of the proceeds of said sale, the plaintiffs be paid their said mortgage debt, with interest, and their costs in this suit, and that the residue of the said proceeds of sale, if any, be held subject to the further order of this Court.
The defendants appealed, and now moved this Court to reverse the circuit decree, on the grounds: •
1. Because S. S. Elam had no such title as could be the subject of mortgage and foreclosure in this Court.
2. Because the proceeds of the Sheriff’s sale having been applied to executions older than the plaintiffs’ mortgage, the defendant MeElwee took the premises discharged of the lien of the mortgage.
3. Because his Honor erred in permitting the plaintiffs to amend their bill, after going into the trial, by making A. T. Black a party.
Smith, for appellant.
Williams, contra.

Opinion:
Curia, per
Dunkin, C. J.
Upon the matters discussed in the decree this Court concur with the Chancellor. As to the third ground of appeal, it is only necessary to say that A. T. Black was merely a formal party as holding the legal title, and the discretion of the Chancellor was properly exercised.
The appeal is dismissed.
Wardlaw and Inglis, J. J., concurred.
Appeal dismissed.