Court Opinion

ID: 6505489
Source: CourtListenerOpinion
Date Created: 2022-07-19 18:17:45.448468+00
Date Added: 2024-06-11T15:54:43.402900
License: Public Domain

RICE, J.
—When an* execution from a court of record is levied by the sheriff on personal property mortgaged to another, the mortgagee, or Ms assignee, may, by virtue of section 2595 of the Code, try the right of property, as provided in chapter second of title second of the Code, before the law-day of the mortgage has arrived.
"' To deny this, is to deny any meaning to the words employed in that section, which profess to confer a right on the mortgagee or his assignee; for it is very clear, that under section 2587, the mortgagee, or his assignee, is authorized to try the right of property, whenever such execution is levied oh such property after the law-day; of the mortgage.
' Sound exposition requires effect to be given to every significant clause, sentence, or word in a statute ; and the two sections’ above cited must be held operative to the full extent above indicated. — Smith’s Com. on Stat. 710.
*358But the execution, under which the levy in this case was made, is an execution for less than fifty dollars, issued by a justice of the peace, and levied by a constable. The claim is Interposed under section 2838 of the Code, found in title throe, which is apparently devoted to “proceedings in-civil cases before justices of the peace.” The claim Is interposed by a mortgagee, before the law-day of his mortgage arrived. Such a claim cannot be sustained, unless section 2595 extends to the mortgagee, or his assignee, the same right, when the levy is made by a constable under a justice’s execution, as when it is made by a sheriff under an execution from a court of record.
It has ever been, and still is, the right of an execution creditor in this State, by suit in equity, to compel the creditors or beneficiaries provided for by a fair and valid deed of trust or mortgage to sell the property, or close the trust, on equitable terms, whenever such deed, by the long credit given, or otherwise, becomes oppressive or injurious to him.—Dubose v. Dubose, 7 Ala. 235; Pope v. Wilson, 7 ib. 690; Tarver v. Roffe, 7 ib. 873.
Until the act of January 25th, 1845, (Pamph. Acts,p. 136,) the mortgagee could not, by interposing. a claim, or by any other proceeding at law, prevent the personal property embraced by his mortgage from levy and sale under execution against the mortgagor, before the law-day of the mortgage. Many sales were.made under execution of the mortgagor’s interest, before the law-day. Such sales, almost invariably, resulted in the sacrifice of the property, and in working injury both to the mortgagor and mortgagee. To prevent such injury and such sacrifices of property, which had been mortgaged in good faith, was doubtless the main object of the Legislature in passing the act of 1845, and in a substantial re-enactment of it in section 2595 of the Code.
If personal property embraced by a valid mortgage, the law-day of which will not arrive for several years, is permitted to be sold under execution at law, experience has proved that injury therefrom must result, either to mortgagor or mortgagee, or to both. This ought not to be, when they have acted fairly in the execution of the mortgage. There is no necessity for such injury. The execution creditor can, as we have above shown, by bill in equity, obtain all he ought to *359have. He is the party who ought to be compelled to resort to chancery ; because the mortgagee, having fairly obtained a preference by his mortgage, ought to be permitted to stand on the defensive, and should not be forced (although he is allowed) to become an actor in a court of equity, to maintain an advantage honestly gained over other creditors.
If the execution creditor resorts to a court of equity, he must make the mortgagor and mortgagee parties to his bill. When a sale is decreed under such a bill, all the parties will be protected and benefited. Purchasers, knowing that the title under such a sale is free from encumbrances, will be more willing to give a fair price for the property. They will know what they are buying. • The proceeds of such a sale will be greater than could result from proceedings at law. The honest mortgage and costs of the Chancery Court will be first paid out of those proceeds, and put of the surplus the execution creditor will be entitled to satisfaction.
Although, in certain cases, where the amount of the mort-i gage debt is known, the execution creditor may, if he chooses, pay it off, and sell, as shown in section 2595, yet he is not bound to do so in any case. He may resort to the Court of Chancery, as above shown, if he prefers it. And so, although the mortgagee may resort to chancery now, in any case where he could have resorted to it before the Code took effect, he is not bound to do it. He may interpose his claim, and try the right of property, before the law-day of his mortgage, if he prefers it.
The effect of section 2595 is, to secure to the mortgagee the right to elect whether he will interpose his claim at law, or resort to chancery for the protection of his interests under the mortgage ; and if he elects to claim at law, his claim, although interposed before the law-day, must be sustained, if his mortgage is executed in good faith, and for a valuable consideration, and is duly recorded.
This right of election in the mortgagee is not confined to cases where the levy is made by a sheriff under an execution from a court of record, but exists in cases where the levy is made by a constable under an execution from a justice of the peace. The letter, and equity, and reason of the statute, embrace the one class of these cases as well as the other; and *360in conferring this right on the mortgagee; no word is used, which excludes him from trying the right of property when the levy is made under a justice’s execution.
The fact that a constable is not authorized to.soll, as well for the payment of the mortgage as' of the execution, 'furnishes no sound objection to the conclusions above announced ; for it is obvious, there are many cases in which a mortgagee may, before the law-day, interpose his claim,- but in which the execution creditor cannot discharge “ the mortgage debt.” ■ For example, we state the case of a mortgage executed to secure the sureties of a public officer against loss by reason of his defaults. What is “ the mortgage debt,” in such a case, before half his official term expires?' ' No man, nor court, can tell. It cannot be discharged by an execution creditor; yet under such a mortgage, a claim might be interposed by the mortgagees. This serves to show, that the Legislature conferred on the execution creditor a privilege much more restricted than was conferred on the mortgagee. • '
The court below erred in excluding the mortgage offered in evidence by the appellant, which' embraced the property levied od and in controversy in this suit.—Wallis v. Rhea,10 Ala. 451; 5 ib. 531; 7 ib. 698.
That mortgage is not void on its face.—Mauldin v. Robinson, 11 Ala. 980.
For the error of the court below in excluding the mortgage, its judgment is reversed, and the cause remanded.