Case Name: Wilsford et ux v. Johnson et al.
Court: Mississippi Supreme Court
Jurisdiction: Mississippi
Decision Date: 1925-10-26
Citations: 141 Miss. 739
Docket Number: No. 25120
Parties: Wilsford et ux v. Johnson et al.
Judges: 
Reporter: Mississippi Reports
Volume: 141
Pages: 739–756

Head Matter:
Wilsford et ux v. Johnson et al.
[105 So. 736.
No. 25120.]
(Division A.
Oct. 26, 1925.)
Chapman, Moody & Johnson, for appellants.
Everett & Foreman, for appellants.
Forrest G. Cooper and Neill & Clarh,"for appellees.
Argued orally by C. C. Moody, for appellant, and Forest G. Cooper, and S. D. Neill for appellee.
Headnotes 1. Mortgages, 27 Cyc., p. 1413 (Anno); 2. Mortgages, 27 Cyc., p. 1249; 3. Liens, 37 C. J., Section 27; 4. Mortgages, 27 Cyc., p. 1459 (Anno).

Opinion:
Cook, J.,
delivered the opinion of the court.
The appellants, T. F. Wilsford and wife, executed a deed of trust on certain real and personal property to secure an indebtedness of twenty-three thousand seven hundred two dollars and forty-four cents due to the appellee J. N. Johnson; this deed of trust being subordinate to a prior mortgage indebtedness of fifteen thousand dollars. Thereafter the appellants negotiated a loan of thirty thousand dollars from the Union Central Life Insurance Company, and in order to consummate this loan it became necessary to pay oft the prior mortgage indebtedness of fifteen thousand dollars, and- to have the appellee J. N. Johnson waive the lien of the deed of trust in his favor. -To effectuate this there was paid, out of the proceeds of this thirty thousand dollar loan, the prior mortgage indebtedness, and also the sum of thirteen thousand dollars to the appellee J. N. Johnson upon the execution by him of a waiver whereby the priority of his deed of trust was subordinated to the one executed by appellants to said insurance company. In connection with this transaction, the appellant T. F. Wilsford and the appellee J. N. Johnson entered into a written agreement extending the payment of the balance of the indebtedness due Johnson by Wilsford. This agreement, after fixing the time and terms of these payments, further recited that — "As the consideration for the extension of the payment of the balance due as described in and secured by said deed of trust, the second party agrees that in addition to the lien in the said deed of trust, he, as the owner of said premises, will, when requested so to do, deliver to the first party a paramount and first chattel deed of trust, conveying in trust all of the crops, stock, and personal property on the above described premises for the year 1924, securing the amounts due for that year; and will, when requested so to do, execute a first and paramount deed'of trust conveying in trust the crops, stock, and personal property on said premises, or used in making said crop for the year 1925 to secure the amounts above mentioned to be paid in 1925.
"It is further understood and agreed that the second party, during the year 1924 and 1925 agrees to work said premises in his own name."
Thereafter the appellant Wilsford failed and refused to execute the chattel deed of trust referred to in this extension agreement, and thereupon the appellee John son, conceiving that said agreement had been violated by Wilsford, repudiated said agreement, and, after the indebtedness matured under the terms of the original note, he caused the trustee named in the deed of trust to advertise the land and property covered thereby. After the advertisement and before the day fixed for the sale of this property, the appellants rénted the same to one N. L. Wise for five thousand dollars to be paid out of the proceeds of the crop grown on said land for the year 1924, and thereupon filed this bill of complaint seeking to restrain the foreclosure of the deed of trust on the theory that, by virtue of the terms of said extension agreement, nothing was due.
The appellees answered the bill averring, in substance, that the extension agreement was conditioned upon Wilsford 's compliance with the obligations thereof, viz.: The execution when requested of a paramount chattel mortgage as additional security for the payment of the balance due; that the extension agreement was abrogated by Wilsford's failure and refusal to perform the vital covenants on his part, after having' been given a reasonable opportunity of so doing, and consequently, he was not entitled to the extension and the entire indebtedness was past due when the proprty was advertised for sale.. They also made their answer a cross-bill containing, among others, the following averments:
"•Tour cross-complainant would further show that if the cross-defendants had not enjoined them from foreclosing said deed of trust, J. N. Johnson would either have received his indebtedness due by them or would himself have become the successful bidder and owner of said property and would thereby have become entitled to the rents, issues, and profits from said lands for the year 1924. Tour cr'oss-complainants would further show that under the terms of said extension agreement that cross-defendants had obligated themselves to work said land in the name of T. F. Wilsford and to execute a para mount and first chattel deed of trust on the 1924 crops on said lands and on all personal property thereon to secure the amounts due to J. N. Johnson on December 10, 1923, as aforesaid, but that prior to the advertisement of said land and prior to the injunction and the date of the foreclosure sale, cross-defendants had attempted to lease said lands to others and prior to the injunction and date of foreclosure sale had actually leased said land to N. L. Wise for five thousand dollars for the year 1925, thereby breaching their contract; that they had also, when notice was given to execute the deed of trust called for in said contract, declined, refused, and failed to execute the same, thereby further breaching their contract; that if said foreclosure had been made and J. N. Johnson had become the purchaser thereat, he would have been entitled to the rent or if the cross-defendants had carried out their contract as agreed, he would have been entitled to security on the said rents.
"Cross-complainants would further show that they are advised and believe and so state and charge that the cross-defendants are about to transfer, and assign said rent note for five thousand dollars to other parties for the purpose of defeating the rights of the said J. N. Johnson and if said transfer is made, irreparable harm and injury will be caused your cross-complainant, and unless this court will enjoin and restrain the said cross-defendants from negotiating, selling, transferring, or assigning said rent note, and any other rent notes which they or either of them named may have heretofore or hereafter received, for the year 1924, rent on said lands, and unless they and each of them are further restrained and enjoined from transferring, selling, or assigning to others.the rent which they might receive for the use of said lands during the year 1924, irreparable harm and injury will be caused your cross-complainant J. N. Johnson."
The prayer of the cross-hill, in substance, is that the complainants, as cross-defendants, be enjoined from selling, negotiating, transferring, or assigning any note or lease contract for the rent of said land for the year 1924, and also from assigning the five thousand dollar rent note for that year executed by N. L. Wise; that the proceeds of any rent -which the cross-defendants may receive, or be entitled to receive, be impounded as security for the indebtedness which the cross-defendants owed the cross-complainant J. N. Johnson, and that they be required to pay the same into court pending the final termination of the cause.; that the injunction theretofore granted restraining the sale under the deed of trust be dissolved and damages awarded for the wrongful issuance of said injunction; that the court, by proper decree, impress an equitable lien on the 1924 crop to be produced on said land, to secure the payment to the said J. N. Johnson of the said indebtedness due him, and that a suitable person be appointed as receiver to collect, preserve, and dispose of enough of the said agricultural products to secure the payment of the amount due to J. N. Johnson by the cross-defendants.
The injunction prayed for in the cross-bill was granted, and upon the final hearing a decree was entered dissolving the injunction granted the complainants on the original bill, and awarding as damages for the wrongful issuance thereof, five per centum on the amount due on the indebtedness secured by the deed of trust, a sale under which had been enjoined. The decree further ordered that the injunction theretofore granted the appellees, as cross-complainants, be made perpetual; that the cross-complainant J. N. Johnson b'e granted an equitable lien on all of the agricultural products produced during the year 1924, on the lands in controversy, to the extent of five thousand dollars, which amount was found to be the rental value of said land for said year; and that J. L. Williams be appointed a receiver to collect such rents and the proceeds of the sales of all of the agricultural products grown or produced on said lands during the year 1924, not to exceed five thousand dollars with interest thereon from the 1st day of November, 1924, and to apply such proceeds on the indebtedness secured by the deed of trust involved, sale under which had been enjoined by complainants.
It is not seriously contended, as indeed it cannot be upon this record, that the extension agreement was in effect at the time of the attempted foreclosure of the deed of trust from Wilsford to Johnson. This extension agreement provided that, as a consideration for such proposed extension, Wilsford would execute a chattel deed of trust on certain property therein described as additional security for the payment of the indebtedness. When requested so to do, he failed and refused to execute such a deed of trust, and, as a result of this breach of the conditions of the agreement, the appellee Johnson had the right to rescind, and did rescind, the agreement, and consequently, when the debt due the appellee matured under the terms of the original note, his right to foreclose the security for the payment of the same was clear. It follows that the action of the court below in dissolving the injunction restraining the sale under the deed of trust, and awarding the statutory damages for the wrongful issuance of the injunction, was correct.
The principal objection urged by the appellant against the decree is directed to the action of the court in restraining the collection or sale by the appellant of the five thousand dollar note for the 1924 rent, and granting to the appellee an equitable lien on all of the agricultural products produced during the year 1924 on the land covered by the deed of trust to the extent of the five thousand dollar rental value thereof.
It is somewhat difficult for us to determine upon what equitable doctrine the appellee asserts a lien upon the rents accruing from the lands conveyed by the deed of trust- during the delay in the foreclosure thereof occasioned by the wrongful issuance of the injunction, and, in order that the contentions of appellee may more clearly appear, we have set out in full the averments of the cross-bill in reference to the rent. While the extension agreement, executed by these parties, provided that the appellants would execute a lien in favor of appellee Johnson on the rents, issues, and profits of the land for the year 1924, it is admitted that appellee cannot and does not assert any rights under this agreement, since it was wholly abrogated. The deed of trust which the appellee was seeking to foreclose covered the land and certain personal property, but did not cover the rents, issues, or profits of the land, and it has been expressly held by this court that a mortgagee is not entitled to the rents of the land mortgaged as against the mortgagor. Brooks v. Kelly, 63 Miss. 616.
It appears from the record that the appellee, who was the junior mortgagee, in order to prevent a foreclosure of the senior incumbrance in favor of the Union Central Life Insurance Company, was compelled to pay the interest accrued on this senior incumbrance, and appellee contends that — "When Johnson, the junior incumbrancer, was compelled to pay off Wilsford's debt to the senior incumbrancer on lands upon which both held liens, that Johnson was entitled to an equitable lien on the profits from the land which he was compelled to protect after Wilsford defaulted."
This contention is not maintainable. By virtue of ¡he deed of trust from Wilsford to the insurance company, this amount does constitute a lien on the land, but this deed of trust covers only the'land, and not the rents or profits, and the appellee's remedy for the amount paid the insurance company, if any, is that of subrogation to the rights of the insurance company.
An examination of the averments of the cross-bill, which are hereinbefore set out, shows that the real ground upon which, the asserted right to an equitable lien is based is that, if the cross-defendants had not enjoined the foreclosure of the deed of trust the appellee Johnson would have received the value of the rents for the year 1924, if sold to a stranger, or he would have become the successful bidder and the owner of the land and would thereby have become entitled to the rents, issues, and profits from said land for the year 1924. In its final analysis, it seems to us that this amounts to a claim for damages in addition to the statutory damages allowed for the delay occasioned by the wrongful issuance of the injunction. In the case of Williams v. Bank, 71 Miss. 858, 16 So. 238, 42 Am. St. Rep. 503, this court said:
£ £ There may be cases, exceptional in their • circumstances, in which, by reason of change in the condition of the property or the expense incident to its caré and preservation during the pendency of the injunction, other and different damages should be allowed. But when one claims and receives the damages allowed by the statute, he cannot receive, in addition thereto, other damages, to be ascertained by reference to other considerations. Those provided by the Code are exclusive when allowed."
In the ease at bar the appellee has claimed and been allowed the statutory damages, and if it could be said that this is one of those ££exceptional" cases which warrants the allowance of other and additional damages against the injunction bond, this would not create a lien against the rents accruing while the injunction was pending. We do not think the decree attempting to impress a lien upon the rents and products of the land for the year 1924 can be sustained under any view of the case. Consequently, the decree of the court below dissolving the original injunction and awarding the statutory damages will be affirmed, while the decree will be reversed in so far as it sustains the injunction prohibiting the transfer, collection, or sale of the five thousand dollar rent note; and fixes a lien upon the said rent note and products of the land for the year 1924; and appoints a receiver to collect the rents and the proceeds of the sales of the agricultural products grown or produced on the lands during the year 1924; and a decree will lie entered here dissolving the injunction prohibiting the transfer, sale or collection of said rent note by appellants.
Affirmed in part, and reversed in part, and decree here.
Affirmed.
Reversed.