Brown v. Hogan

• Decision Date: 05 April 1921
• Docket Number: 29.
• Citation: 113 A. 756,138 Md. 257
• Parties: BROWN et al. v. HOGAN.
• Court: Maryland Court of Appeals

113 A. 756

138 Md. 257

BROWN et al. v. HOGAN.

No. 29.

Court of Appeals of Maryland

April 5, 1921

Appeal from Circuit Court, Prince George's County; Fillmore Beall, Judge.

Suit by William A. Hogan against Sarah E. Brown and others. Decree for complainant, and respondents appeal. Reversed, and bill dismissed.

Argued before BOYD, C.J., and BRISCOE, THOMAS, URNER, STOCKBRIDGE ADKINS, and OFFUTT, JJ.

Ogle Marbury, of Baltimore (Marbury & Perlman, Philip B. Perlman and Lloyd L. Jackson, Jr., all of Baltimore, on the brief) for appellants.

William Stanley, of Baltimore, for appellee.

BOYD C.J.

The bill of complaint was filed in this case by the appellee to have a deed from David Shaffer to Walter Brown and wife and a mortgage from them to Frank Brown set aside, and to have a contract entered into between George P. McCeney, attorney for Shaffer, and Harry F. Frost, on behalf of the appellee specifically enforced. A decree was passed in accordance with the prayers of the bill, and this appeal was taken by Walter Brown and wife and Frank Brown from that decree.

A contract was entered into between "George P. McCeney, attorney for David Shaffer," of the first part, and William A. Hogan, of the second part, by which the party of the first part undertook to sell to Hogan a house and lot in Laurel for the sum of $850, of which $150 had been paid before the signing of the agreement, and the balance was to be paid upon the delivery of the deed-the purchaser to have 30 days in which to complete the purchase and examine the title. The agreement, which was signed and sealed by "George P. McCeney" and by "H. F. Frost, for W. A. Hogan," was dated October 20, 1919, and followed a verbal arrangement made a few days before between McCeney and Hogan. On the 26th of October, David Shaffer, who lived in Baltimore, agreed to sell the property to Walter Brown and Sarah Brown, his wife, for $900, and accepted $50 as part payment on that day, and later conveyed the property to them. Frank Brown loaned them, on a mortgage, $800 to be used in payment of the purchase money.

There can be no doubt that Mr. and Mrs. Brown knew before they purchased the property from Shaffer, and Frank Brown had ample notice before he loaned the money to them, that McCeney had, as Shaffer's attorney or agent, undertaken to sell it to Hogan. We will not therefore discuss that question, but will treat it as settled that the contract of sale executed by McCeney with Hogan is binding on all of them if he had authority to make it. The important question then is whether McCeney was authorized to enter into that contract of sale, so as to be binding on Shaffer. His right to sell the property, of course, cannot be based merely on the fact that he was the attorney for Shaffer in the settlement and division of his father's estate or in other matters, unless he had some authority other than that arising from the ordinary relation of attorney and client; but the plaintiff relies on what is spoken of as a power of attorney, and also on a special power to sell this property given McCeney in September, 1919.

On September 17, 1917, Shaffer borrowed some money from McCeney and gave him a mortgage on all of his interest in the property which he inherited from or was left to him by the will of his father and another property he owned, to secure $125, which was payable three months after date. The mortgage included the usual covenants and power of sale in case of default, and then immediately following the power of sale was the power of attorney relied on by the plaintiff. Although there is no copy of the mortgage in the record, the terms were referred to without objection and the power of attorney was read into the record by Mr. McCeney when he was on the stand, which is as follows:

"Or in case of default as hereinabove set forth, instead of having the said property sold, the said mortgagee, his successors or assigns, may elect, as long as he or they choose, to take possession of, manage, and conduct the mortgaged property under the following power, i. e., I do hereby constitute, nominate, and appoint George P. McCeney, of Prince George's county, state of Maryland, to be my true, sufficient, and lawful attorney irrevocably for me and in my name and stead to sell, exchange, convey, mortgage, or lease, and in all manner to dispose of, charge, and manage any and all of the real estate, leasehold, or other property mentioned in this mortgage for the purpose of satisfying this mortgage, or the two preceding mortgages mentioned in this mortgage, and for me and in my name and stead to execute and acknowledge, according to law, any and all conveyances and contracts which he may deem necessary and expedient for the above purposes, or what may be required by law for the purpose of this power of attorney, and also to collect all rents or sums of money which may be or become due to me, and to give receipts therefor in my name and pay all taxes. ***"

It then concludes in what may be said to be the usual form of such instruments. Without feeling called upon in this case to determine how far a mortgagee would be permitted to take possession of mortgaged property and act under such a power of attorney, inserted in the mortgage, it is clear that McCeney did not take possession of the property and act under that power. It is shown that at the time the mortgage was given there was an equity proceeding for a partition or division of some kind, which resulted in certain properties, including the one in controversy, being conveyed to David Shaffer by the executors of his father's estate about the middle of June, 1919. At that time the properties which were allotted to David Shaffer were valued at $11,000, and were subject to about $5,000 of liens. The mortgage to McCeney was in default from its maturity, but it would have been very inequitable for him to take possession of all these properties and hold them until his mortgage was paid. McCeney did not attempt to so hold the properties, and he did not sell any of them under that power. He testified that several persons approached him about purchasing some of them, and he talked to Mr. Shaffer, but he would not sell them, and "that witness did not sell any property when a man came to see him unless he asked Mr. Shaffer, because he was his attorney as well as mortgagee." In the sale of what he spoke of as the Beall purchase, Mr. Shaffer refused to let him sell it at the price Beall offered, and then afterwards sold it himself to Beall for that price. Mr. McCeney added, "That was the only property sold that I participated in." In point of fact he examined the title for Mr. Beall. The mortgage had been in default for nearly two years when McCeney agreed to sell this property to Hogan, but there is no reference in the contract of sale to the power of attorney, or intimation that he was selling by virtue of it. It was proven that William C. Shaffer, a brother of David, collected rent from Walter Brown, who was the tenant, made the repairs, and had been negotiating for some time with the Browns for the sale of the property. Indeed, on October 14, 1919, he wrote to his brother "that W. Brown wants to buy the house where he lives and thinks he should have first chance on it." In the absence of his brother, who lived in Baltimore, he represented him, and, judging from what he did, the public might well have regarded him, and not McCeney, as the bill alleges, as the agent of the property, especially as he was one of the executors of their father's estate and had been collecting the rents from Brown both before and after the deed was made to David. But as we think it is clear that the contract of sale was not entered into by virtue of the power of attorney in the mortgage, we will not discuss that branch of the case further, but will call attention to the fact that the language of the letter which Mr. McCeney wrote to Mr. Shaffer does not indicate that he wanted to sell the property under the power of attorney.

That letter was dated December 22, 1919, and addressed to Shaffer in Baltimore. It is as follows:

"Will you please let me know if you desire to sell the little house on Montgomery street that you own and is occupied by Brown? The property was appraised at $750.00. If you desire to sell this property, please let me know what your lowest cash price is and I believe that I may be able to sell it."

McCeney testified:

"That in response to that letter Mr. Shaffer came to his office, and after a conversation he agreed to sell it for $850; that the party to whom he was talking at that time did not take it; he thought it was too high."

On cross-examination he was asked:

"Do you recall exactly what he said about selling the property? A. I could not tell you verbatim. I know he came into my office and wanted to talk about that piece of property. He said it ought to bring $850. That is what he would take for it."

He said he did not think that any time was mentioned within which he wanted it sold, but "I am positive there was no time mentioned as to how long a time was given me to sell or close this deal." He was asked: "Did he give you the exclusive right?" and replied: "He did not give any exclusive right. When he came into my office he told me the price was $850, and he told me practically 'Go ahead and sell it."' When he wrote the letter to Shaffer another man was inquiring about the property. He declined to take it, and shortly afterwards Hogan called to see him about it, and he (McCeney) signed the contract in duplicate and sent the two copies to Mr. Frost, who signed them for Hogan and sent them and a check for $150, the cash payment, to him but he did not actually receive them until October 25, as he was away from home. He did not notify Mr....