Hinton v. Jones

• Citation: 136 N.C. 53,48 S.E. 546
• Parties: HINTON v. JONES.
• Decision Date: 20 September 1904
• Court: United States State Supreme Court of North Carolina

48 S.E. 546

136 N.C. 53

HINTON

v.JONES.

Supreme Court of North Carolina.

Sept 20, 1904.

NOTE —CONSTRUCTION —DEED OF TRUST—SALE— VALIDITY.

1. The entire amount of a note, providing for interest from the date thereof "to be paid semiannually and the principal to be paid one-tenth annually until the note is paid in full, " does not become due on the failure to pay the first installment.

2. Where a note was given, providing for interest from the date thereof "to be paid semiannually and the principal to be paid one-tenth annually, " secured by deed of trust, with power of sale should the mortgagor fail to well and truly pay the note as it falls due, a sale by the mortgagee under the power of sale for the nonpayment of the first installment, but before the maturity of the entire note, is void.

Appeal from Superior Court Pasquotank County; Hoke, Judge.

Action by John L. Hinton against H. J. Jones. From a judgment for plaintiff, defendant appeals. Reversed.

This was an action to recover possession of a house and lot. The plaintiff sold to the defendant the lot in question on October 23, 1899, for the sum of $6,000 and a policy of insurance upon the life of the said Jones in the sum of $4,000. On the same date Jones executed to one C. L. Hinton, a son of the plaintiff, a deed of trust upon said land to secure the purchase money, no part thereof being paid in cash. His note of even date was executed to the plaintiff in the sum of $6,000, "with interest from date, to be paid semiannually and the principal to be paid one-tenth annually until the said note is paid in full." The deed of trust provided that "should the said Jones well and truly pay said note as it falls due then this deed shall be null and void. But should he fail to do so then the said C. L. Hinton may sell, " etc. The deed of trust was foreclosed by a public sale of the land on January 16, 1901, when and where the plaintiff became the purchaser at the price of $150. Subsequently he brought this action for the recovery of the land. The issues and answers thereto were as follows: "(1) Was the deed of trust referred to and described in complaint and answer procured by fraudulent and false representations on the part of the plaintiff or his agent, W. T. Davis? Ans. No. (2) Was the sale under which plaintiff purchased had and made before the power of sale had arisen or become absolute? Ans. No. (3) Is plaintiff owner of the lot sued for and described in lie complaint? Ans. Yes. (4) Does defendant wrongfully withhold possession of said lot? Ans. Yes. (5) What damage is plaintiff entitled to recover by the wrong and injury? Ans. 5 cents." The court below charged the jury that if they should answer the first issue "No, " and believed the evidence in the case, they should answer the second issue "No." The court further charged them that "if they should answer the first issue 'No, ' and believed the evidence in the case, they should answer the third and fourth issues 'Yes.'"

Ward & Thompson, for appellant.

Pruden & Pruden and E. F. Aydiett, for appellee.

DOUGLAS, J. (after stating the case). The only point that we need consider is the answer directed by the court which raises the legal question as to whether the power of sale became absolute upon the failure of the defendant to pay the first installment ofthe purchase money, or must await the maturity of the entire note. There is no direct provision that the entire note shall become due and payable upon default in any of its installments. It is contended that this is implied by the wording of the deed, but it is not so "nominated in the bond, " and we do not feel that the policy of the law or the equities of this case require us to enlarge by mere implication the rights or powers of a mortgagee or trustee to so dangerous an extent. It is true, the parties could have so stipulated; but, if there had been any such stipulation, there might not have been the same inducement on the part of the defendant to pay a price so largely in excess of the apparent value of the property. We do not see any substantial difference, in legal effect, between the material facts in the case at bar and that of Harshaw v. McKesson, 66 N. C. 266. In that case the condition of the mortgage was as follows: "Now if the said W. F. McKesson shall well and truly pay and discharge said several debts according to the agreement now made—the one-third part thereof in three years, one-third part in four years, and the remainder in five years from this date, then this deed to be void and at an end, otherwise to remain in full force and virtue." The...