Dozier v. Farrior

• Decision Date: 14 May 1914
• Docket Number: 499
• Citation: 187 Ala. 181,65 So. 364
• Parties: DOZIER v. FARRIOR et al.
• Court: Alabama Supreme Court

65 So. 364

187 Ala. 181

DOZIER v. FARRIOR et al.

No. 499

Supreme Court of Alabama

May 14, 1914

Appeal from Chancery Court, Bullock County; L.D. Gardner Chancellor.

Suit by Hattie Farrior and others against W.B. Dozier to declare void a foreclosure of a mortgage, and to set aside a sale thereunder, and for redemption. From a decree overruling demurrers to the bill, defendant appeals. Affirmed.

George W. Peach, of Clayton, and Rainer & Andrews, of Union Springs for appellant.

J.D Norman, of Union Springs, for appellees.

DE GRAFFENRIED, J.

We quote the following rules which, in our opinion, govern the principal questions presented by this record:

First. "Where the parcels are so situated that they can be conveniently sold and conveyed separately, the general rule governing a sale in parcels under a decree and order of sale will govern a sale in a foreclosure by advertisement." Wiltsie on Mortgage Foreclosures, p 900, § 796.

Second. "It is a well-settled principle of law, irrespective of any statute, that, where a tract of mortgaged land has been laid out in parcels for separate and distinct enjoyment, it should be sold in parcels on a decree of foreclosure. *** A sale in a different manner may be a sufficient reason for avoiding the sale, if the price received is disproportionate to the actual value of the premises." Wiltsie on Mortgage Foreclosures, p. 591, § 488.

1. Farrior and wife made a mortgage to one Frazer to secure the payment of two notes. There were several distinct parcels of land and some personal property conveyed by the mortgage. Some of the distinct parcels of land had been dedicated by Farrior to separate and distinct uses. The lands were, in fact, town lots. Upon one of the lots Farrior had his residence. Upon another lot he had a two-story building, the lower story of which was used as a store, and the upper story as a public hall. Upon another of these lots was a frame building used as a store. Some of the other lots were vacant and were widely separated from the lots above described. The personalty consisted of a piano and a pianola.

Farrior died, and the mortgagee, under the power of sale contained in his mortgage, sold, after proper advertisement, all the lands and personalty en masse. W.B. Dozier bid the property in at the sale, and a deed was regularly made to him under the power contained in the mortgage.

2. The widow and son, who is the only heir of Farrior, the mortgagor, filed this bill in a double aspect. They first allege in the bill that, by selling the property en masse, a price greatly less than the real value of the property was obtained, and that, for this reason, the sale should be set aside, and complainants be allowed to redeem; and there is a prayer in the bill to that end. Complainants then allege that included in the property which was sold was the piano and pianola, that they have called upon Dozier for a statement of the amount which he claims to be due him for the purchase money of the land and other lawful charges thereon, and that he has furnished them a statement which is incorrect, because it contains no credit for the value of the piano and pianola which he obtained as a purchase at said mortgage sale. Complainants then pray that, if the sale is not set aside, and they are not permitted to exercise the equity of redemption, then that they be permitted to exercise the statutory right of redemption, and to that end that the amount which they will be required to pay to exercise that right be ascertained. In so far as the facts set up in the bill are concerned, we may as well say, at this point, that if the facts alleged in the bill are true, the bill as a bill to exercise the statutory right of redemption can be maintained without a tender. Johnson v. Davis et al., 60 So. 799.

3. If the allegations of the bill are true, then personalty and lots widely separated, some of them dedicated to separate and distinct uses, were all sold by the mortgagee under the power of sale in the mortgage, at one time en masse, and by that means were caused to bring a sum much less than their real value. If this allegation is true, then equity should avoid the sale and let the complainants in to exercise their equity of redemption. Wiltsie on Mortgage Foreclosures, supra; Mahone v. Williams, 39 Ala. 202.

We direct attention to the limits of the rule which we now have under consideration. The lands must be in "separate parcels, distinctly marked for separate and distinct enjoyment," and such parcels, when so sold en masse, must bring at the sale an inadequate price. Mahone v. Williams, 39 Ala. 202.

A mortgagee is, in a sense, a trustee for the mortgagor, and, in exercising the power of sale contained in his mortgage, he must not disregard the rights of the mortgagor. The rule which we now have under discussion arises out of "the reasonable presumption, sanctioned by observation and experience, that such property," i.e., property in distinct parcels, distinctly marked for separate and distinct enjoyment, "will produce more when sold in parcels, because the sale is thus accommodated to the probable wants of purchasers." Mahone v. Williams, supra.

Of course, if such property is sold en masse and brings a fair price, the mortgagor will not be heard to complain.

4. A foreclosure under the power contained in a mortgage has the same effect upon the equity of redemption as a strict foreclosure in a court of equity. Hunter v. Mellen, 127 Ala. 343, 28 So. 468.

A purchaser of mortgaged property at a sale under the power contained in a mortgage can as a general rule, therefore, acquire no greater rights as such purchaser than a purchaser at a sale had under a decree of a court of equity foreclosing the mortgage. When, under a decree of foreclosure, a sale en masse is had of separate parcels of land devoted to separate and distinct uses, and the purchaser at such sale buys the property at a sum disproportionate to its real value, then, upon seasonable and appropriate application of the mortgagor, such sale will be set aside. Wiltsie on Mortgage Foreclosures, supra.

It follows, of course, that when such a sale and purchase are had under the power of sale contained in a mortgage, the mortgagor, if the purchaser acquires the property at a sum disproportionate to its real value, may, by seasonable action, have the sale annulled. Wiltsie on Mortgage Foreclosures, supra; Stephens v. Clay, 17 Colo....