Bostick v. Jacobs

• Decision Date: 21 May 1902
• Citation: 133 Ala. 344,32 So. 136
• Parties: BOSTICK v. JACOBS ET AL.
• Court: Alabama Supreme Court

32 So. 136

133 Ala. 344

BOSTICK v. JACOBS ET AL.

Supreme Court of Alabama

May 21, 1902

Appeal from chancery court, Jackson county; Wm. H. Simpson Chancellor.

Suit by F. A. Bostick against J. C. Jacobs, as executor, and others. From a decree in favor of defendants, the complainant appeals. Reversed.

The bill averred substantially the following facts: On July 5 1898, J. W. Shoemaker purchased a certain tract of land from the defendants for the sum of $4,000. This was a credit transaction, and Shoemaker executed his four promissory notes to his vendors,--one for $500, due November 1, 1898; one for $1,000, due January 1, 1899; one for $1,000, due November 1 1899; and one for $1,500, due January 1, 1900. The complainant, F. A. Bostick, signed the first of these two notes executed by Shoemaker as a surety for said Shoemaker. The defendants conveyed the property to Shoemaker by deed and Shoemaker executed a mortgage to them upon the same property to secure the payment of the four notes above mentioned. Upon default in the payment of the first two notes, the defendants brought a suit in the circuit court against the appellant as surety on the first two notes, and on March 7, 1899. recovered a judgment against the complainant in the sum of $7,738.72. On June 12, 1899, the defendants, by virtue of the power contained in the mortgage foreclosed said mortgage, and at said foreclosure sale became the purchasers of the property for $1,600. Shortly after the foreclosure of the mortgage and the purchase of the mortgaged property by the defendants, they sold the property so purchased to one Smith for the sum of $4,000. It was then averred in the bill that it was understood and agreed between the complainant and Shoemaker on the one side and the defendants on the other that the complainant should be protected as such surety by the mortgage which was to be executed on the property so purchased by Shoemaker and the defendants; that this mortgage was to be primarily for the protection of the complainant, as surety on said two notes that the mortgage executed was not such a mortgage as was agreed to be given, and did not give to complainant the primary protection agreed upon; that said mortgage not only secured the first two notes, but also the entire indebtedness as evidenced by the other two notes, and that it was stipulated therein that upon the failure to pay either one of said notes the whole mortgage indebtedness should become due and payable, and the mortgage should be foreclosed, and that in this respect the said mortgage departed from the agreement and understanding between the complainant and the defendants; that the complainant was entitled to the benefit of the proceeds arising from the foreclosure of said mortgage, or from any fund realized from the property described in said mortgage, and has the right to have it applied for his benefit on such two notes on which he is surety in preference to the note on which he is not surety; that the defendants have received out of the proceeds of such mortgaged property a sum sufficient to liquidate the two notes which he signed as surety, and that he is entitled to have such notes canceled, and...