Court Opinion

ID: 7984279
Source: CourtListenerOpinion
Date Created: 2022-09-09 01:23:54.734071+00
Date Added: 2024-06-11T16:35:08.777321
License: Public Domain

SlMRALL, J. :
The specific objection taken in the demurrer to the bill, and urged by counsel in this court is, that the remedy at law is adequate. The mortgage confers upon the mortgagee a power of sale, upon default made in the performance of the conditions; that is, nonpayment of the money; therefore there was no necessity, as urged by counsel for appellant, to bring this foreclosure suit. Such securities as this, upon their first introduction into use, encountered the serious opposition for a time of the equity courts. It was thought *449to be too peremptory and barsb upon the debtor. The equity of redemption being a favorite with the court,' and the old doctrine being that the mortgagor could not by a covenant in the deed bind himself not to claim or waive it, it was supposed to be curtailment of this right to confer upon the mortgagee a power to cut it off by a sale in pais. As mortgages have come in modern times to be more especially and emphatically regarded as securities for debts, in order to avoid the delays and expenses incident to a foreclosure of the ordinary and usual equity of redemption, it is now coming into common use to give the mortgagee the power of sale.
The controversy heretofore has been, not whether the mortgagee could execute the power in pais, but whether he must not obtain the sanction of a court of chancery to the sale. The position which he bore to his debtor gave him, it was thought, the opportunity to act oppositely. He is made trustee of the equity of redemption, with power to dispose of it without the consent and against the interests of the mortgagor. Upon such considerations the learned chancellor, in Ford v. Russell, Freeman Ch. 48, determined that a mortgagee could not make a valid sale without the sanction of the court. The power of sale does not alter the redeemable character of the instrument. The equity of redemption subsists in the mortgagor so long as the power has not been executed. Eaton v. Whiting, 3 Pick. 490.
It was very strongly intimated, in 1 Rand. 306, that a sale, did not cut off the equity of redemption. The great weight of authority, as said in Wofford v. Board of Police of Holmes county, 44 Miss., is, that a sale by the mortgagee extinguishes the equity of redemption. The title is conveyed to the mortgagee with a power to transfer it when a contingency arises for a sale. It is like an authority constituting an attorney in fact. Smith v. Bovin, 6 Allen (Mass.), 518. But because *450there is conferred upon the mortgagee a power of sale, his right to foreclose by judicial proceedings is not barred. 1 Hill. Mort. 129; Marriott v. Givens, 8 Ala. 694; 21 ib. 573. The utmost that can be said of it is that the remedy is cumulative.
So peremptory is the remedy by sale, so great is the temptation to act unfairly and oppressively, so absolute is the power over the mortgagor, to determine the time of sale, to state the account, and act as commissioner in his own case, that the courts will watch very closely the mortgagee’s proceedings, and for the least unfairness or excess, or for anything affecting competition, the sale will be strictly construed as against the mortgagee. Longwith v. Gilmer, 3 Gilm. (Ill.) 32; 1 Hill. Mort. 131. Influenced by such considerations, this court, whilst upholding the power as valid, in Hyde v. Warren, 46 Miss. 29, commended a resort to chancery for a foreclosure decree as the better practice.
We think that a sale made by the mortgagee under the power in this deed would have the same effect as a sale by a trustee, under the ordinary deeds in trust, so far as the equity of redemption would be concerned— that is, it would be cut off.
The decree of the chancellor is affirmed, and cause remanded with leave to defendant to answer in forty days from this date.