Barnett v. Waddell

• Decision Date: 25 July 1946
• Docket Number: 8 Div. 315.
• Parties: BARNETT et al. v. WADDELL
• Court: Alabama Supreme Court

27 So.2d 1

248 Ala. 189

BARNETT et al. v. WADDELL

8 Div. 315.

Supreme Court of Alabama

July 25, 1946

Bradshaw & Barnett, of Florence, for appellants.

F. S. Parnell and R. M. Sims, both of Florence, for appellee.

The bill of complaint, filed by 'Robert H Waddell, as administrator of the estate of W. F. Waddell deceased, over 21 years of age, and a resident of Lauderdale County, Alabama, against' the abovenamed respondents, alleges that respondents W. T. and W. A. Barnett executed and delivered to W. F. Waddell, during his lifetime the following instrument:

'Rogersville Alabama,

March 15th, 1926.

On January 1st., 1927 after date, without grace, I promise to pay to W. F. Waddell, or order $1500.00, Fifteen Hundred Dollars with interest at 8% at the Bank of Rogersville, Rogersville, Alabama.

In case this note is not paid by me at maturity, I agree to pay all costs of collection, including a reasonable attorney's fee. As against the payment of this note, I hereby waive all rights of exemption under the laws of Alabama, or any other State of the United States. As collatteral security for this, or any other debt I now, or may hereafter owe said payee, I hereby pledge the following collatteral, mortgage the following property, with power to sell the same publicly or privately, with or without advertisement, if the indebtedness secured hereby is not paid at maturity, viz.: One garage located at Rogersville, concrete block building 81 feet long, 57 feet wide.

W. T. his X Mark Barnett

W. A. Barnett

Witness--W. D. Herston'.

It is further alleged that 'said instrument as note and equitable mortgage' was duly recorded in the office of the Probate Judge of Lauderdale County. That no part of the indebtedness evidenced by said instrument as a note was ever paid, except the interest for 1926 in 1927, the interest for 1927 in 1928, and a payment sometime in the year 1930 of $60, on the 1929 interest, and a payment of $6.95 on August 9, 1935, and that the balance of said indebtedness including interest is long since past due and unpaid. That by the execution of said instrument an equitable mortgage against the property referred to therein was given by said respondents W. T. and W. A. Barnett to secure the payment of the indebtedness evidenced by said instrument to W. F. Waddell, now deceased, and while the description of the property therein referred to is not so certain, yet it can be made so by oral and record evidence. That the mortgaged property referred to in said instrument consists of a concrete block building about 81 feet long, and about 57 feet wide, and the lot on which the same is situated, all being known as the Barnett Garage in Rogersville, Alabama, and the only concrete block garage property owned by respondents W. T. and W. A. Barnett in Rogersville, Alabama, at the time of the execution of said instrument by them, the said lot facing west on Pulaski Road about 65 feet in width, and running back about 100 feet, and bounded on the north and east by the C. W. Patton property (owned in 1919 by T. C. Andrews), and on the south by the W. P. Romine store house property (owned in 1915 by H. V. Harvey), being a part of the S.W. 1/4 of S.E. 1/4 of Section 32, Township 7 West, Lauderdale County, Alabama. That on March 8, 1937, respondents W. T. and W. A. Barnett executed to respondent Effie Barnett (wife of said W. A. Barnett at that time) a deed conveying said mortgaged property to her, partly describing said property in said deed as 'a garage and restaurant', as the front of the building at that time was being used as a restaurant, and the rear part of the property as a garage. That said Effie Barnett at the time of said conveyance to her had both actual and constructive notice of said equitable mortgage lien against the property and she is made a party hereto, that when said property is sold the purchaser may get a good title thereto.

The prayer is that the court adjudge and declare the amount of the unpaid indebtedness evidenced by said instrument owing by respondents W. T. and W. A. Barnett, and that complainant, as such administrator, has an equitable mortgage lien against said property to secure payment thereof, and that said lien be enforced by a sale of said property. There is also prayer for general relief.

SIMPSON Justice.

Robert H. Waddell, as administrator of the estate of W. L. Waddell, deceased, sues in equity to foreclose an equitable mortgage on real estate.

The bill clearly indicates the suit to be by Waddell in his representative capacity as such administrator.

Right to the enforcement of the lien is based on a note dated June 15, 1926, signed by defendants (appellants), in which the land was 'mortgaged' and 'pledged' as 'collateral security.' The bill is to declare and close this lien.

The note pledging the property described in it as security for the debt constituted an equitable mortgage within the rule of our cases and, if genuine, was enforceable in equity as such. Bishop v. McPherson, 232 Ala. 594, on page 598, 168 So. 675, and authorities cited; Lewis v. Hickman, 200 Ala. 672 (and cases page 673), 77 So. 46; 41 C.J. 303, § 9.

The heirs of the decedent were not necessary parties. The ultimate goal of the proceeding was to collect the note as an asset of the estate, title to which was vested in the administrator. To realize on this asset was the administrator's authority and duty. Webb v. Sprott, 225 Ala. 600, 144 So. 569; Lewis et al., executors, etc. v. Wells et al., 50 Ala. 198; Gilchrist v. Gilchrist, 223 Ala. 562, 563, 137 So. 406.

There are no circumstances here which require the heirs of Waddell as parties to the litigation. The legal title, nor possession of the land sought to be brought under the lien, is or ever was in Waddell, the equitable mortgagee, or his heirs (Huggins et al. v. Hall et al., 10 Ala. 283; Shepherd et al. v. Birmingham Trust & Savings Co., 233 Ala. 320, 171 So. 906), but was in defendants, the debtors, when the instrument was executed, and is now in their grantee, and the proceeding is, in essence, to convert this asset into money by foreclosure of the lien. Silverstein et al. v. First Nat. Bank of Birmingham, 231 Ala. 565, 165 So. 827; Hudgens v. Cameron's Adm'r, 50 Ala. 379. It is only because legal title under a duly executed mortgage of realty passes to the mortgagee that some courts have indicated that the heirs of such deceased mortgagee are, under certain circumstances, necessary parties to a foreclosure suit by the personal representative. 42 C.J. 43, § 1556.

The bill, though it could have been more specific, sufficiently avers the execution and delivery to the intestate in his lifetime of the instrument creating the lien on the property described, to secure the indebtedness stipulated in the instrument, and that such indebtedness was past due and unpaid. We hold these allegations to be sufficient against the asserted demurrer.

It is true that to constitute an equitable mortgage the mortgagor must have a mortgageable interest in the property and a definite debt must be due from him to the mortgagee (Jones v. Stollenwerck, 218 Ala. 637, 119 So. 844), but the allegations of the bill import as much and were sufficient in this regard. The averment of the execution of the instrument suffices to show a mortgageable interest in the mortgagor without any specific allegation to this effect, he being estopped by the instrument to deny his title. 3 Jones on Mortgages, 8th Ed., § 1852, p. 332.

The instrument was not under seal and the argument is advanced that the action was barred by limitation of six years, Code 1940, Tit. 7, § 21. The contention overlooks the fact that the suit is not an action on the note to recover a monied judgment but is in the nature of a proceeding in rem to enforce a lien on real estate. The statute of six years does not apply.

Though recovery on the indebtedness may be barred by limitation this only operates on the remedy. The lien is not thereby lost nor is the right to enforce it necessarily impaired. Ware v. Curry, 67 Ala. 274, 285; Little v. Montgomery, 235 Ala. 615, 180 So. 269; 2 Jones on Mortgages, 8th Ed., § 1542, p. 1040.

The case of Kelley v. Woodley, 228 Ala. 401, 153 So. 745, 746, cited by appellant as sustaining the contrary contention, involved, as stated in that opinion, 'an equitable remedy to recover for money had and received' and but emphasizes the distinction and illustrates the correctness of our holding.

The statute of limitation of ten years inhibiting, after the lapse of such period, actions for the recovery of lands, etc., was also impleaded as a defense. Code 1940, Tit. 7, § 20.

W. A. Barnett and his father, W. T. Barnett, were the signatories to the instrument. The note matured January 1, 1927, and this suit was filed in 1941. W. A. Barnett, however, on his own acount in the interim, before the running of the statute, made several payments on the note which thus saved the bar against the enforcement of the lien on his interest in the property. He did deny executing the note or having made these payments on it, but on an impartial consideration of the evidence we are persuaded to the contrary and have concluded against his claim in this regard, as did the trial judge.

The status, though, of his father, W. T. Barnett, is different. The evidence is entirely lacking that W. T. Barnett had any knowledge of the making of these payments by his son. His signature to the note was by mark and, from a comparison of the instrument with other original exhibits sent up for our inspection, we would say the note appears to be in the handwriting of W. A. Barnett and a suspicion arises as to whether W. T. Barnett did, in fact, execute it. So far as is disclosed by the evidence, during the...