Adler v. First Nat. Bank

• Decision Date: 07 January 1937
• Docket Number: 6 Div. 23
• Parties: ADLER et al. v. FIRST NAT. BANK OF BIRMINGHAM.
• Court: Alabama Supreme Court

171 So. 904

233 Ala. 325

ADLER et al. v. FIRST NAT. BANK OF BIRMINGHAM.

6 Div. 23

Supreme Court of Alabama

January 7, 1937

Appeal from Circuit Court, Jefferson County; E.M. Creel, Judge.

Bill in equity by the First National Bank of Birmingham, as trustee for Mary W. Persons, against Ike Adler and others. From a decree overruling a demurrer to the bill, respondents appeal.

Affirmed.

Wm. S Pritchard and David R. Solomon, both of Birmingham, for appellants.

Cabaniss & Johnston and K.E. Cooper, all of Birmingham, for appellee.

KNIGHT Justice.

Bill by appellee, the First National Bank of Birmingham, as trustee for Mary W. Persons, against appellants to foreclose mortgage.

It appears from the bill that the appellants on May 13, 1929 executed and delivered to the First National Bank of Birmingham a mortgage on certain described property in the city of Birmingham, Ala., to secure the payment of their indebtedness to said bank in the principal sum of $10,000 which was evidenced by one principal note in said amount, due three years after date. The said principal sum bore interest from date at 7 per cent. per annum, payable semi-annually and to evidence the interest payments six separate interest notes were executed and delivered to said bank.

It is averred in the bill that the funds used for making the loan secured by said mortgage were funds belonging to said bank as trustee for Mary W. Persons.

It appears from the bill that the said notes and mortgage of appellants, the said Ike Adler, Everett Shepherd, and A. Page Sloss, were "duly transferred and assigned" on June 25, 1929, by the First National Bank of Birmingham to the First National Bank of Birmingham as trustee for said Mary W. Persons.

It further appears that the said Mary W. Persons on September 17, 1929, executed a "declaration of trust" to the First National Bank of Birmingham; that under the terms and provisions of said declaration of trust the First National Bank of Birmingham acquired and holds certain property and assets, including said notes and mortgage, in trust for the use and benefit of the said Mary W. Persons. A copy of the declaration of trust is attached to and made a part of the bill.

Among other provisions the trust agreement contains the following:

"The trustee shall invest said sum and such other sums as may from time to time be paid over to it in such loans, securities, or other property, real or personal, as to said trustee may seem suitable, and shall hold said investments and such other property as it may subsequently acquire pursuant to the power and authority herein given to it (all of which for convenience may hereinafter sometimes be referred to as 'trust estate') with full power to sell, exchange, lease, encumber or otherwise dispose of all or any portion of such property, in such manner and upon such terms and conditions as said trustee may approve, and to change investments and to make new investments from time to time in such loans, securities or other property, real or personal, as to the trustee may seem suitable, whether such investments shall be legal investments for trust funds or not. The trustee shall have power to determine whether any money or property coming into its hands shall be treated as a part of the principal of the trust estate or a part of the income therefrom, and to apportion between such principal and income any loss or expenditure in connection with said trust estate as to it may seem just and equitable.

"The trustee shall hold said trust estate in trust for my use and benefit for and during my lifetime. During such period the trustee shall pay over to me from time to time, or use and apply for my support and comfort, and for the support, education and comfort of my children, in such installments as may be found most satisfactory, the entire net income from said trust estate, and in addition thereto such parts of the principal of said trust estate as I may from time to time request, or as the trustee in its discretion may deem necessary or desirable for said purposes."

Default was made by the mortgagors in the payment of the mortgage indebtedness, and this bill was filed to foreclose the mortgage.

The respondents filed numerous grounds of demurrer to the bill as a whole, and separately to its several phases.

The court overruled the demurrers, and from the interlocutory decree the respondents bring this appeal.

It is a well-settled rule of equity pleading that the complainant's title should be stated with sufficient clearness and certainty to enable the court to see clearly he has such a right as warrants it in taking jurisdiction. Every essential fact necessary to make out his title to maintain the bill must be set forth. McKinley v. Irvine, 13 Ala. 681, 693; Cockrell v. Gurley, 26 Ala. 405; Rapier v. Gulf City Paper Co., 64 Ala. 330; Overton v. Moseley, 135 Ala. 599, 33 So. 695; Eutaw Ice, Water & Power Co. v. Town of Eutaw, 202 Ala. 143, 79 So. 609; Ezzell v. Richardson et al., 221 Ala. 346, 128 So. 783.

It is first insisted that the bill is fatally defective in that it is nowhere averred in the bill whether the complainant "is composed of persons, is a partnership, or is a corporation."

The insistence does not approach merit. It is averred in the second paragraph of the bill that "The First National Bank of Birmingham is a national banking institution organized and existing under the laws of the United States having its offices and principal place of business in Birmingham, Alabama. Said bank is vested...