Cox v. American Freehold & Land Mortg. Co.

• Decision Date: 14 May 1906
• Citation: 40 So. 739,88 Miss. 88
• Court: Mississippi Supreme Court
• Parties: ANNA L. COX ET AL. v. AMERICAN FREEHOLD AND LAND MORTGAGE COMPANY OF LONDON ET AL

40 So. 739

88 Miss. 88

ANNA L. COX ET AL. v. AMERICAN FREEHOLD AND LAND MORTGAGE COMPANY OF LONDON ET AL

Supreme Court of Mississippi

May 14, 1906

FROM the chancery court of Jefferson county, HON. WILLIAM P. S VENTRESS, Chancellor.

Mrs Cox and others, the appellants, were complainants in the court below; the Mortgage Company and others, the appellees were defendants there. From a decree sustaining the demurrer of some of the defendants to bill and the amended bill and dismissing the suit, the complainants appealed to the supreme court. The facts are fully stated in the opinion of the court.

Reversed and cause remanded.

Theodore McKnight, for appellants.

(1) Mere delay in bringing suit, short of the period of limitations and unconnected with any act of estoppel, does not bar action.

(2) The appointment by the acting trustee of an agent, who under the provisions of the instrument is empowered not only to perform merely ministerial acts, but also to exercise the same discretion in making the sale as the acting trustee could do is within the statute of frauds. Code 1892, § 4231.

(3) Where a deed of trust provides that "in case of the refusal, neglect or incompetency to act of said trustee, or his absence from the state, or his decease," the parties interested in the debt can at any time they may desire appoint a substituted trustee, and where the trustee mentioned in the instrument is permanently absent from the state before and at the time of the breach of the conditions of the deed of trust, and while so absent undertakes to execute the trust, his acts are void.

(4) The vendee of the purchaser at a void sale under a deed of trust is not an innocent purchaser, etc., but the doctrine Caveat Emptor applies, and where the conveyance from the trustee to the purchaser at the sale is not so acknowledged or proved as to entitle it to be recorded, the vendee of such purchase cannot defend against bill to redeem by claiming that he had no notice of any defect in the title shown either by the records or otherwise. Nash v. Hill, 73 Miss. 849 (s.c., 19 So. 707); Houston v. Building Association, 80 Miss. 31 (s.c., 31 So. 540); Code 1892, § 2731; Dunton v. Sharpe, 70 Miss. 850; Wade v. Thompson, 52 Miss. 367; Walker v. Brunguid, 13 Smed. & M., 763; Hartley v. O'Brien, 70 Miss. 825; Bowman v. Roberts, 52 Miss. 126; Bonner v. Lesslie, 61 Miss. 592; Gooch v. Addison, 35 S.W. (Texas App.), 83; Code 1892, §§ 4230, 4231; 28 Am. & Eng. Ency. Law (2d ed.), 858; Commissioners, etc. , v. Walker, 6 How. (Miss.), 143; 6 Am. & Eng. Ency. Law (2d ed.), 537; 2 Ib., 1009; Harlow v. Higgins, 84 Texas, 201; 2 Perry on Trusts, sec. 602; Carter v. Cox, 44 Miss. 148; Givins v. Foote, 40 Miss. 794; Moore v. Crump, 84 Miss. 612 (s.c., 37 So. 109); Jones on Mortgages, sec. 1774; Farmers, etc., Co. v. Hughes, 11 Hun. (N. Y.), 130 (28 Am. & Eng. Ency. Law [2d ed.], 770); Equitable, etc., Co. v. Fisher, 106 Ill. 189; May v. May, 4 A. & E. D. E., 705; Weir v. Jones, 84 Miss. 602 (s.c., 37 So. 128); Johns v. Sargent, 45 Miss. 332; Tyler v. Herring, 67 Miss. 169 (s.c., 6 So. 840); Clark v. Wilson, 53 Miss. 119; Cox v. Parmer, 60 Miss. 798; Mitchell v. Hockett, 25 Calif., 539; Clarke v. Hozeman, 13 W.Va. 718; Shapley v. Plant, 79 Miss. 175 (s.c., 28 So. 799).

A. H. Geisenberger, for appellees.

We are aware that the court has heretofore held, in considering the facts of the particular case then before the court, that there is no such thing in Mississippi as a stale case where the suit is brought within the time limited in the statute of limitations. But the court has frequently said that each case must be governed and considered by the facts and circumstances of each particular case.

It must, I think, strike the court as particularly strange, under the facts set forth in the bill of complaint, that the complainants should have waited just one day less than ten years before filing their bill--just one day less than the time in which the plea of the statute of limitations of ten years would have forever barred the suit.

In the whole bill there is not one word, nor an intimation, that the complaints, or either of them, did not know each and every fact connected with the sale of the property by the trustee; the crying off of the land by Stinson; the declaring the land sold to Graham; the absence from the state of Currier, the trustee; the making and execution of the deed by Currier, and filing for record, as well the day the several occurrences took place as they did the day the bill was filed. There is no allegation of fraud, express or implied, contained in the bill to account for the unreasonable delay in the filing of the suit.

The complainants yielded up possession of the property after the sale; the purchaser thereunder went into immediate possession thereof; the property was sold to the Jacobs' nearly two years after the delivery of possession to Graham, and they went into immediate possession, and during this time and during these occurrences the complainants, who were then in as full knowledge of the facts as they are now, said not one word to indicate that the sale was not in every requirement and particular in strictest accordance with the law.

It is a well established rule that when a suitor applies to a court of chancery for relief any considerable length of time after the wrong complained of was committed, it is incumbent on him to show, by both averment and proof, some sufficient excuse to justify the delay. 18 Am. & Eng. Ency. Law (2d ed.), 100.

The more the record in this case is studied in comparison with the Dunton case--Dunton v Sharpe, 70 Miss. 850 (s.c., 12 So. 800)--the more alike the two cases appear in all essential particulars.

In the Dunton case the trustee was a nonresident of the state, and the fact of his nonresidence stated upon the face of the deed in trust; he was absent from the state at the time of the sale; the sale was made by some one acting for the trustee; the property was declared sold to one either interested in the debt or in the Loan Company; there the debt was not all due, but was declared due by "actions which spoke louder than words"; there the land was sold for only one-fifth of its value and it was claimed that the lands were sacrificed; and there the deed was executed by the nonresident trustee after the sale. Thus it will be seen that there are no essential points in which the case at bar differs from the facts in the Dunton case.

The personal attendance of the trustee at the sale was not necessary. It was allowable for him to act through others in advertising and auctioning the land. All that was necessary was to comply with the deed of trust, and if this was done with the sanction and approval of the trustee it was as if done by him in person.

Charles T. Coleman, on same side.

A deed of trust authorized the appointment of a substituted trustee under the hand and seal of the beneficiary. The appointment was in writing, but not under sale.

"Equity looks to the substance and not to the shadow; the defective execution of a valid power will be sustained in favor of creditors and purchasers for value, and others, not mere volunteers, when the intention of the parties clearly appears and has been substantially carried out, and when the defect complained of is a technical one, and which it may reasonably be presumed was not occasioned through fraud and did not result in legal injury to the parties interested. 1 Story's Eq. Jur., secs. 94, 97, 170, 174; 2 Wash. Real. Prop., 335, sec. 8." Jacobs v. McClintock, 53 Texas, 80.

The case of Bonner v. Lessley, 61 Miss. 392, cited by the appellant, is not in conflict with our contention. In that case the deed of trust required that the appointment of a substituted trustee should be under the hand and seal of the person executing the power. The appointment was in writing, but was not signed or sealed. It was held to be fatally defective. The appointment of a substituted trustee, who is to be invested with the powers, duties and discretion of the original trustee and in whom the legal title is to vest after condition is broken, is a very different thing from the mere appointment of an agent by a trustee to perform a ministerial duty. In the one case the entire authority for the appointment depends upon and is derived from the terms of the instrument. Unless the instrument authorizes it, the power does not exist at all, and if a substituted trustee should become necessary, resort would have to be had to a court of chancery. It is for this reason that the terms of the instrument must be strictly complied with in the appointment of a substituted trustee, and this is the principle which underlies the decision in Bonner v. Lessley. But these considerations have no application to the appointment of an agent, who is invested with neither title nor discretion, to perform merely ministerial or mechanical acts. And this is the principle which underlies the decisions in John v. Sergeant, 45 Miss. 332; Tyler v. Herring, 67 Miss. 169 (s.c., 6 So. 840); Dunton v. Sharpe, 70 Miss. 850 (s.c., 12 So. 800). In these cases it was held that a trustee under a deed of trust to secure a debt, empowered to sell the land conveyed upon twenty days' notice, may employ a stranger to post the notice and conduct the sale, and if these acts are ratified by the trustee and a deed made by him to the purchaser at the sale, the title is thereby conveyed. If the power to appoint an agent was in any manner referable to or dependent upon the terms of the instrument, these decisions would have been to the contrary.

The sale took place on the 21st of February, 1895. The original bill in this case was filed just ten years, lacking one day after the day of the sale. It is alleged that the sale was...