Hughes & Tidwell Supply Co. v. Carr

• Decision Date: 20 November 1919
• Docket Number: 8 Div. 187
• Citation: 203 Ala. 469,83 So. 472
• Parties: HUGHES & TIDWELL SUPPLY CO. v. CARR et al.
• Court: Alabama Supreme Court

83 So. 472

203 Ala. 469

HUGHES & TIDWELL SUPPLY CO. v. CARR et al.

8 Div. 187

Supreme Court of Alabama

November 20, 1919

Appeal from Circuit Court, Lawrence County; O. Kyle, Judge.

Bill by the Hughes & Tidwell Supply Company against J.D. Carr and others, seeking to have a receiver appointed, for an accounting, creating a lien, foreclosing the mortgage, and for personal judgment over. From the decree rendered complainant appeals. Affirmed.

The facts are sufficiently stated in the statement made by Brown J. The decree overruled the demurrers of the respondent to the original bill as well as the demurrers of complainant to the answer and cross-bill. The question propounded by this appeal is whether the lien of appellants, under their mortgage from Carr, executed on the 5th day of January, 1915 and duly recorded in the probate office of Lawrence county on the 7th day of January, 1915, covering the crops grown by Carr during that year on the lands described in the bill, is superior to the rights or liens of McColloch, asserted by the cross-bill. The cross-bill advances two theories as establishing the superiority of the lien held by McColloch.

The first is that McColloch is the assignee of the mortgage executed by Carr to Bussey on the 29th day of January, 1914 covering the crops to be raised by, or that might accrue to, Carr during the year 1914, and "each successive year until the debt thereby secured is paid in full." The original bill alleges that the debt secured by this mortgage has been paid, and the lien created thereby discharged; but these averments are denied by the answer and cross-bill, and the issue thereby presented appears to be one of fact.

The second theory is that McColloch had a landlord's lien on the crops grown by Carr during the year 1915, for rents and advances, which is by the statutes made paramount to all other liens. The facts upon which the assertion of this lien is predicated are: McColloch, being the owner of the land upon which the crops were grown in the year 1913, sold and conveyed them to Carr, for and in consideration of $65, paid in cash, the assumption of an outstanding mortgage held by an insurance company, and $800, to be paid, $300 in the fall of 1914, $300 in the fall of 1915, and $200 in the fall of 1916; McColloch executing and delivering to Carr a deed to the land. Contemporaneously Carr executed and delivered to McColloch a mortgage to secure these deferred payments. By the terms of the mortgage it was provided that, in case of default in the payment of any one of such installments, the mortgagee was authorized to declare the entire debt due, and to proceed to a foreclosure under the power of sale contained therein.

Carr defaulted in the payment of the first installment, and in the later part of November or the first of December, 1914, informed McColloch that he could not meet the payments on the mortgage debt. At this time they entered into an agreement, as the cross-bill avers, "to avoid delay, trouble, and expense of a foreclosure of said mortgage," by which Carr agreed to pay $265 rent for the land for the year 1914: McColloch allowing as a credit on this the $65 previously paid by Carr at the time of the purchase of the land. Carr then turned over to McColloch the land conveyed by the mortgage, in consideration that McColloch's debt against him, as evidenced by said mortgage, should be treated as satisfied, and "McColloch then took over said land, and possession thereof, or right of possession, and assumed control and ownership thereof."

It is alleged that said agreement was entered into in good faith, and that the amount agreed to be paid as rent for the land for the year 1914 was reasonable, and that the value of the land was not in excess of the amount of the indebtedness secured by the mortgage, and that said contract or agreement was intended as, and to take the place of, in law and equity, a foreclosure.

After this agreement was made, and Carr had attorned to McColloch for the rent for the year 1914, Carr opened up negotiations with McColloch to rent the land for the year 1915, and these negotiations continued until the 28th day of June, 1915, then culminating in a contract of rental by Carr of the land for said year, and on this date Carr executed and delivered to McColloch a deed to the land.

Tennis Tidwell, of Albany, for appellant.

Callahan & Harris, of Decatur, for appellees.

BROWN J.

By the default of the mortgagor, the McColloch mortgage was discharged of its condition on December 1, 1914, and the estate of the mortgagee became absolute, subject only to an equity in the mortgagor to redeem from the forfeiture, which a court of equity, to prevent hardship and injustice, would raise and enforce on his application. McColloch was then absolutely...