Court Opinion

ID: 3242219
Source: CourtListenerOpinion
Date Created: 2016-07-05 16:15:24.954103+00
Date Added: 2024-06-11T13:40:19.542196
License: Public Domain

[EDITORS' NOTE:  THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 212 
The bill was for injunction as to a mortgage foreclosure, for accounting between mortgagor and mortgagees.
The original bill, filed by appellants, October 18, 1940, alleged that on February 12, 1926, appellants executed a mortgage to W. I. Heflin, for the purpose of securing an indebtedness of one thousand ($1,000) dollars, maturing February 12, 1927, and conveying a lot in the Town of Moulton, Alabama; that the mortgagee died, leaving the appellees as the sole heirs at law and distributees; that subsequent to the maturity of the mortgage indebtedness, the complainant, J. L. Weatherwax, attended to and looked after the affairs of the estate at the request of the appellees, with the agreement that the value of such services were to be applied on the indebtedness secured by the mortgage, and that the services were reasonably worth the amount of the indebtedness secured by the mortgage, and was thereby satisfied.
It is further averred that the appellees were proceeding to foreclose the mortgage. In addition to the general prayer for relief, special relief was sought for an order requiring the record of the mortgage to be marked paid and satisfied, or, in the alternative, that it be ascertained and determined the true amount owed on said mortgage, and to allow complainants a reasonable time within which to pay the same. The bill also prayed for a preliminary writ of injunction.
The court granted the preliminary injunction.
In answer to the bill, the appellees averred that in addition to the mortgage indebtedness admitted and alleged by the appellants, on May 4, 1926, the appellants incurred an additional indebtedness of one hundred twenty-five ($125) dollars, evidenced by promissory note, signed by them in and by which it was stipulated and agreed that said indebtedness was secured by said mortgage, and that on December 9, 1929, an additional indebtedness of three hundred seventy-five ($375) dollars, was incurred evidenced by promissory note, in which it was stipulated and agreed that that indebtedness should also be secured with said mortgage. It was further averred in the answer that there was an agreement with J. L. Weatherwax, a nephew of W. I. Heflin, that he would assist his aunt in the handling of the affairs of her husband's estate, for which he was to be paid the interest on his indebtedness to the estate, and this was the sole and only agreement for compensation.
The trial court decreed that the complainants' prayer for relief be denied and disallowed; that the complainants were indebted to the defendant at the date of the decree in the sum of two thousand two hundred and ten ($2,210) dollars; that if said indebtedness was not paid within sixty days from the enrollment of the decree, the lands embraced in the mortgage should be sold for the satisfaction of said indebtedness. *Page 217 
Several questions of law that application are that: as between themselves the parties to a mortgage may by agreement extend the security of same to cover an additional indebtedness. Abbeville Live Stock Co. v. Walden, 209 Ala. 315,96 So. 237; Forsyth v. Preer, Illges  Co., 62 Ala. 445.
In McWhorter v. Tyson, 203 Ala. 509, 83 So. 330, it is held: "Under the statute of frauds as to realty and the statute prohibiting parol mortgages of personalty, a parol agreement to impose on the property a charge or lien to secure a different debt or obligation from that originally intended is ineffective."
A mortgagor seeking to redeem must be prepared to pay not only the obligation originally secured by the mortgage, but a subsequently incurred indebtedness for which an agreement was duly made that the land should be held a security. In 17 A.L.R. p. 14, Rule II, many authorities are collected to the effect that, "The broad general doctrine is announced in many cases that a contract required by the Statute of Frauds to be in writing, cannot be modified by subsequent oral agreement."
In 36 Am.Jur. p. 786, § 187, it is said: "The general rule is that the imposition of conditions not contained in a mortgage, or the payment of a debt not secured thereby, may not be exacted as a condition of redemption from the mortgage. A different rule has been adopted in some cases, however, where the mortgagor is seeking the aid of a court of equity in the enforcement of his equity of redemption, in which case the maxim 'he who seeks equity must do equity' is applied in such manner as to require as a condition precedent to relief the payment by the mortgagor of not only the mortgage debt, but all other debts due from the mortgagor to the mortgagee."
And in the same volume of American Jurisprudence, § 196, p. 790, it is said: "A tender of payment of a mortgage debt must be kept good in order to maintain a suit for redemption from a mortgage, and it is generally regarded as an essential part of a bill to redeem a mortgage that it offer in express term to pay the amount due with costs. Sometimes, it is required that the money be paid into court. The principle underlying these rules is that he who seeks equity must do equity. On the same principle, it has been held that a mortgagor going into equity to redeem may be required to pay not only the mortgage debt, but all other debts due from him to the mortgagee. [Chamberlain v. Thompson, 10, Conn. 243, 26 Am.Dec. 390; Lee v. Stone, 5 Gill.  J., Md., 1, 23 Am.Dec. 589; Coombs v. Jordan, 3 Bland, Md., 284, 22 Am.Dec. 236. Annotation: 18 Eng.Rul.Cas. 277.] * * *." (Brackets supplied from text.)
The rules just set out are contrary to the rule of McWhorter v. Tyson, 203 Ala. 509, 83 So. 330, supra. However, the better statement of the rule is found in 36 Am. Jur. p. 722, §§ 67 and 68, which follows:
"Although there is authority to the contrary, the general rule is that a mortgage cannot secure future advances unless it was intended to do at the time of its execution, and that subsequent parol agreements by the parties that it should have that effect are nugatory. It has also been stated as a broad proposition that a general agreement to secure future advances must be confined to such as are in the contemplation of the parties at the time the agreement is made. [Forelines v. Paulk et al., 243 Ala. 516, 10 So. 2d 864; Bynon v. Citizens' Bank of Carbon Hill, 221 Ala. 626, 130 So. 391.]
"A mortgage does not secure obligations which were not comtemplated by the parties to be secured thereby. Indeed, it is a general rule that a mortgage cannot, subsequent to its execution, be extended by parol agreement to secure debts or obligations other than those which it was executed to secure. Such an extension, if effective, would be equivalent, to the execution of a new mortgage to secure the additional obligation. It, therefore, falls within the prohibition of the statute of frauds. It is true that oral testimony is admissible to show what obligations were intended to be secured by a mortgage and will be received to establish that the mortgage was in fact given to secure obligations, distinct from those expressed, but this doctrine permits parol testimony only to show the intention of the parties at the time the mortgage was executed and not to establish a subsequent agreement, in effect creating a new mortgage, to extend the mortgage to secure additional obligations. * * *." [Brackets supplied.]
A note of submission is mandatory and it is required under equity rules 56 and 57, Code 1940, T. 7, Appendix, p. 1095, that a note of submission by the parties be made and nothing not noted shall be considered *Page 218 
by the court. "But it is not necessary to note any testimony given orally before the judge in open court under Rule 56, if written out and filed in the cause." The evidence of the complainant and wife was before a commissioner. Home Ins. Co. v. Shriner, 235 Ala. 65, 177 So. 897; Boswell v. Longshore,238 Ala. 535, 192 So. 267; Rule 120, Code 1940, T. 7, Appendix, page 1125; State Tax Comm. v. Commercial Realty Co., 236 Ala. 358,182 So. 31; Allison Lumber Co. v. Campbell, 225 Ala. 609,144 So. 574; Johnston v. Johnston, 229 Ala. 592, 158 So. 528.
We find that no note of submission by complainants is contained in the record. There is a full note of submission on the part of respondents, carrying the deposition of Mrs. Heflin and all exhibits thereto. We cannot consider the testimony as to the complainant and wife as to the exact terms of the contract for services to be rendered the estate and next of kin. The estate was large and appears to have been well handled during the time of depression. The matters exhibited by the record that may be given consideration are: the mortgage of J. L. Weatherwax and wife of date of February 12, 1926, maturing on the 12th day of February, 1927, and for the sum of one thousand ($1,000) dollars, covering the homestead as indicated in brief of counsel and now sought to be foreclosed; the allegations contained in the answer of Mrs. Evie Heflin and her daughter Josephine Heflin Littrell to the effect that on May 4, 1926, a promissory note in the principal sum of $125, bearing interest at the rate of eight per cent from date and payable on demand, which note had the words written in the face thereof, "payment secured with mortgage on real estate"; and that on Dec. 9, 1929, by the administrator of the estate of W. I. Heflin, deceased, transferred and assigned with note to respondents and on the 11th day of May, 1927, complainants executed in favor of the administrator a promissory note for $375 bearing interest at eight per cent per annum from date, and due on the 11th day of May, 1928, which note was duly transferred and assigned to respondents; and that in said note is contained the words, "payment secured with mortgage on house and lot in Moulton, Alabama," and that no payment has been made on the note for $1,000 secured by the mortgage indicated or on the $125 note or on the note of $375, above indicated.
It is apparent from the pleading, answers and testimony of the respondents that the two notes aggregating $500 were not in contemplation of the parties at the time the mortgage for a thousand dollars was given to secure only the sum of one thousand dollars, as the mortgage recites. There is no evidence to the effect that the mortgage was given to secure future advances. Forelines v. Paulk, supra.
Our authorities are clear to the effect that where a real estate mortgage is a different transaction from the other matters sought to be recovered by foreclosure, it does not operate as a security for a later advance, as hereinabove indicated. Crew v. Peoples Trust  Savings Bank, 239 Ala. 615,195 So. 900; Bynon v. Citizens' Bank of Carbon Hill, 221 Ala. 626,130 So. 391, 393.
We need not cite the numerous authorities to the general rule that a mortgage cannot subsequent to its execution be extended by parol agreement to secure debts or obligations other than that which it is executed to secure. Such an attempt as that before us would be equivalent to the execution of a new mortgage to secure the additional obligation and would fall within the prohibition of the statute of frauds. Code 1940, T. 20, §§ 2 and 3. This is not saying that oral testimony is not admissible to show what obligations were intended at the time to be secured by a given mortgage.
The giving of the two notes after the execution of the thousand dollar mortgage, one of said notes being given at the law date of the mortgage (though reference was made therein) could not have the effect of a mortgage on real property. This is emphasized by the fact that the mortgage, as it is insisted by counsel, was the homestead of appellants. Code 1940, T. 7, § 626.
The purpose of the last cited section was to safeguard the wife in order that her signature and assent to the conveyance might be free from the duress of the husband.
Looking to the record and evidence that may be considered under the rule requiring the note of testimony relied upon, we are of opinion that the decree of the circuit court is in error in embracing the two last notes. *Page 219 
The cause is reversed and remanded for another trial where the foregoing error may be corrected, and consideration given, if desired, to the amount of a reasonable compensation to be paid by appellees to appellant Weatherwax for the reasonable services he rendered to decedent's wife and daughter in the handling of the estate and in its due administration.
Reversed and remanded.
GARDNER, C. J., and BROWN and LIVINGSTON, JJ., concur.
                             [On Rehearing.]