Court Opinion

ID: 6528982
Source: CourtListenerOpinion
Date Created: 2022-07-19 19:59:12.27088+00
Date Added: 2024-06-11T15:55:18.209618
License: Public Domain

By Mr, Justice Thornton :
This case comes up by appeal from the decree of the chancellor below, which is sought to be reversed, on the ground assigned as error, that the court dismissed that part of the bill praying a redemption of the mortgaged premises. This assignment, though made with a view to an isolated point in the cause, docs in fact, involve the whole merits of the de- 1 cree: for if the appellant, who was also complainant below, be entitled to redeem, or what is equivalent thereto, to vacate all the proceedings had under his trust deed, and be reinvested with title, upon the payment of the money, which ,it was intended to secure,' the whole of the action of the chan- „ cellor below, in the interlocutory., and final decree, is erroneous.
The history of the case is this, -as presented to us by the bill, answers, &c. A. F. Stone & Co. who were a mercan- , tile firm, consisting of Ashur F. Stone, John B. Lepretre, and Thomas F. Townsley, in the city of Mobile, became indor-sers of a promissory note, negotiable and payable at the Bank pf Mobile, for the sum of two thousand eight hundred dollars, *405made by the said Hogan, on the nineteenth of August, 1823, and discounted for him, in said Bank ; that with the intent to secure them from injury, by said indorsement, the said Hogan executed a deed of trust, conveying the premises therein described, to the defendant Gordon, who was empowered, in case of failure on the part of Hogan, to renew, or pay the said note, upon the request of the said A. F. Stone <& Co.; to sell and dispose of the property; to apply the proceeds'to the cancelment of the note, and pay over the balance, if any, to •the said Hogan. The said Hogan having failed to pay, or renew the said note, the ceshds que use, of whom the defendant Lepretre, is the surviving partner, paid the same, and requested the trustee to proceed arid sell \the property. The property was accordingly exposed, and knocked off at the sum of twenty six hundred dollars, to the cestuis que use, who were the highest bidder's therefor. After this, without,any thing more done towards the completion of this sale, the trustee, upon an erroneous impression, entertained, as it seems by him, in common with the eesiids qui use, that the sale was illegal, because they were the purchasers, exposed the premises to sale a second time, without the consent of the complainant, when the defendant McLosky became the purchaser, at the reduced price of thirteen hundred dollars. A conveyance was executed by the trustee to him, and he after-wards conveyed by a quit claim deed tot he said firm of A. F. Stone & Co. From the answers of the defendant, it is fairly deducible, that he was a mere medium or conduit of transfer, to the said A. F. Stone & Co. to avoid the supposed ille ] gality of an immediate purchase by them. It is not averred in the answer of the trustee, that any money passed ; and MeLosky says, that he did not intend to injure any one of the parties, or “ to affect the interest, in the slightest manner whatever, of the one, to the prejudice of the other.” He says “ he would willingly have reconveyed to the complainant for the cost to him, if the complainant had proposed to ■take the property at that price, and would at any time previ*406ous to Jiis conveyance to A. F. Stone & Co. have "conveyed to said complainant Hogan, if he would have paid, or renewed his said note in Bank, whereon the said A., F. Stone <fe Co. were indorsers ; but as this defendant was informed, and had good reasons to believe, that said complainant refused to take up, or renew his said note ; and that the same was paid by A. F. Stone & Co. - as his indorsers ; that not being disposed, as before mentioned, to retain said premises, at the price he had bid for them, he released said premises to said A. F. Stone & Co. for the same amount he had paid therefor, they being the only persons who proposed to take them at that price.” After the transfer from McLoskey, the two-partners, Stone and Townsley, conveyed to the defendant Lepretre. The property was in the possession of A. F. Stone ¿fe Co. by lease from complainant, at the time of the execution of the deed of trust, and has ever sinee been in the possession of the defendant Lepretre, either claiming it as joint owner with his copartners, or as his sole property,. by virtue-of their conveyance to him as aforesaid. After the last sale of the property! suit was brought b,y A. F. Stone & Co. in. Now Orleans, upon the note secured by this deed of trust, and a recovery had against one Yincent, who was the security of complainant, for the balance due upon it, /after crediting the •sum of thirteen hundred-dollars, the proceeds of the last sale. After answer filed by Townsley, he died, and a guardian ad litem was appointed by the court below, for his infant heirs. Since the removal of the cause into this court, Stone has also died ; his death being suggested on the record, and; the cause considered, as it well may be, to survive against Lepretre, the remaining member of the late firm of A. F. Stone <fc Co. The bill of the complainant prays an account, to be taken of the rents and profits, a cancelment of the several conveyances of the property, and a redelivery of it to him, upon payment of whatever amount may be found to be due from him upon said full accounting between the parties. There is also the general prayer for: relief.. The final decree-*407rendered below, in pursuance of an interlocutory decree rendered in the cause, refuses the specific relief sought; but under the general prayer, undertakes to affirm the first sale of the property, made by the trustee Gordon; and sustains an account taken in pursuance of the said interlocutory decree., The error assigned, is in substance as already stated, “ that the decree of the court repudiated the right to redeem,” which was the main object of the bill; and in view of the statement of facts above exhibited, we will now proceed to consider it. I will premise, however, that the only point upon which this cause can be made to rest, is that of rederiiption, ás presented by the special prayer; for however expansive and efficacious the general prayer of a bill in chancery maybe, of which it was said by an English chancellor, that it was as comprehensive as the Lord’s prayer ; yet I cannot admit that any relief can be afforded under it, which is inconsistent with that specifically sought. So that if no right of redemption is here recognised, there is no warrant for a decree which confirms, as the one rendered! below in this cause does, the first sale made of the property by the trustee. For not only does the complainant not desire it, but he and the defendants both, have consented to eschew it. But although no such decree be,authorised, yet it is necessary to consider' the effect of this sale, as also of the second one, for if the trust has been executed by either, so. as to be obligatory upon the complainant, he cannot have the relief which he seeks, and the error alleged' as the specific ground of the appeal, cannot be maintained. In determining the effect of the first sale, as to its obligatory force upon Hogan, which is assumed as the basis of the decrees below, we have only to ask whether, if the defendants were to attempt its establishment against him, they could enforce it in a court of equity: for if it could not be so enforced, it seems to me, a multo fortiori, that it cannot be done under the present circumstances, where both, parties have concurred in its abandonment. Now that sale was deserted of its parents as abortive, béíorc it was fully *408brought into existence. The trustee made no deed of con* veyance ; the purchasers would have nono; no money was credited to the grantor; on the contrary, they proceed, as though it had never been, to make a second sale, at which, as might have been anticipated, if it was not so intended, only one half of the amount bid at the first, was realized : and this result was doubtless contributed to at least, by the very fact of a former sale, thus capriciously abandoned, without the knowledge or consent of the grantor.- I feel satisfied that this first sale cannot be set up and established in this cause, however it might be, if the complainant were seeking its execution against the purchasers : as to the last sale it would be manifest injustice to recognise it. Then, considering both of these sales vacated, as I think we are bound to do, under the facts and pleadings in this case, what are the rights of the respective parties ? The cestuis que use are entitled to the benefit of the security afforded to theig by the deed of trust, and th’p grantor is. entitled to pay off the debt, and relieve his property from the incumberance ; of which right, I consider his bill as a suitable assertion. To this éxtent, the analogy holds between a deed of trust, and a mortgage. They are both conveyances to secure the payment of money. At any time, in either, before a sale of the property, a redemption is allowable ; but in neither after the sale is effected. According to the modern doctrine respecting mortgages, and the established" rule of decision in this court, the only decree on a bill to foreclose, is the sale of the premises, if the debt be not paid by a day certain, at such time, and in‘ such manner as in the discretion of the court may seem most likely to result in the best price. After this sale there can of course be no redemption. So in relation to deeds of trust. The final result in both is the sale of the property. The only difference is in the mode and manner of the sale. In the former there is the intervention of a court, fix- ■ ing the time, and .it is conducted by the officer of the court. In the latter, the parlies have themselves fixed upon the time *409by a contract, which it is competent to them to make ; as they have also selected an individual, who shall conduct it. If it be objected to, this latter procedure, in comparison with the former, that the scrutiny to which the transaction is subjected in its progress through the courts of the country, is an invaluable safeguard in all cases of trust like this, I have only td reply, that in the latter case also, an appeal may at any time be made to the same tribunal, and the sale be arrested, where fraud, or oppression, or usury, or any other vice in the transaction, may make it obnoxious to such an interference.
The resitlt Of Our examination of this cause, in which we have been greatly aided by the lucid argument of counsel, is that tlie sales by the trustee, Gordon, and all the subsequent conveyances, be held for nought ; that the decree below be reversed; and that the case be remanded to effectuate the principles of this opinion.
It is decreed that air account be directed to be taken by the Judge of the Circuit Court, the basis of which shall be, that the complainant be charged with the amount paid for him by the said firm of A. F. Stone & Co. en the account mentioned in the trust deed, with interest thereon, and that he be credited with all reasonable rents and profits of the said property mentioned in said deed of trust, Since the possession was transferred to the defendants, over and above the value of the lasting improvements which may have been put upon it by "them, if any: and that he be credited with all payments which he may have made -upon the said note : that after the return of the said report, if the said complainant shall, in some reasonable time to be designated by the said court, pay and satisfy to the commissioner who may be appointed by said court, the balance, if any, so reported to be due from him, then the deed of trust aforesaid shall be held as void, and the said complainant be restored to the possession of the premises therein conveyed; but if he fail to pay the said amount, that then the said commissioner shall be directed to *410proceed, in lieu of the said defendant Gordon, to sell and dis Pose ^1C said premises according to the terms in the said deed specified.'