Meadows v. Birmingham Federal Sav. Loan Soc.

• Citation: 166 So. 53,232 Ala. 3
• Decision Date: 16 January 1936
• Docket Number: 6 Div. 762
• Parties: MEADOWS et al. v. BIRMINGHAM FEDERAL SAVINGS LOAN SOC.
• Court: Supreme Court of Alabama

166 So. 53

232 Ala. 3

MEADOWS et al. v. BIRMINGHAM FEDERAL SAVINGS LOAN SOC.

6 Div. 762

Supreme Court of Alabama

January 16, 1936

Rehearing Denied March 5, 1936

Appeal from Circuit Court, Jefferson County; E.M. Creel, Judge.

Suit by George W. Meadows and Lizzie E. Meadows against the Birmingham Federal Savings Loan Society. From a decree sustaining a demurrer to the bill, and dismissing it complainant appeals.

Reversed rendered, and remanded.

M.B Grace, of Birmingham, for appellants.

Stokely, Scrivner, Dominick & Smith, of Birmingham, for appellee.

FOSTER Justice.

This is an action by appellants against appellee begun at law, and transferred to equity by the court ex mero motu. As it appeared at law, it was in three aspects, one, for money had and received, and one for deceit; and count C declared specially for the difference between the amount of the mortgage debt due appellee and the amount of the purchase price of the property at foreclosure sale. The bill as filed in equity on the transfer was dismissed when demurrer was sustained, and complainants appeal. They sought to have the cause retransferred to the law side, by several motions made in equity.

The contention of appellants, both in the complaint and in equity, is that they agreed with appellee to borrow an amount of money ($5,000) from it, repayable in monthly installments, at the rate of 7 per cent. per annum. That they paid those installments for several years and until they had paid, to wit, $3,800, and then discovered that appellee had defrauded them into subscribing for 100 shares of stock in the company, which was a part of the mortgage which they signed, contrary to their verbal agreement, and that the amount which they had paid appellee had been applied, pursuant to that agreement, to the stock subscription and not to the mortgage debt. That appellee foreclosed the mortgage and bought in the property at the sum of $6,000. The court, on the law side, sustained demurrers to the complaint, and in the same judgment ordered that it satisfactorily appears that the cause presents an equitable question, which cannot be disposed of on the law side, and that it be transferred to equity for disposition.

The bill as filed and amended in equity, and which was dismissed on sustaining the demurrer, sought to have decree against appellee for $3,800 as a trust fund, and that a lien be declared for its payment on the stock, and that said trust fund be paid to appellant. The decree sustaining the demurrer referred to the fact that complainant had been given an opportunity to amend the bill to give it equity, but that the amendment did not give it equity, but that counsel for complainant on the hearing insisted upon a retransfer to the law side of the court, having made a motion to that effect. Wherefore, the court sustained the demurrer and dismissed the cause. Complainant had continuously protested at being on the equity docket, and insisted that his action was at law and not in equity, and that his remedy at law was complete.

The dismissal of this cause by decree, which also sustained demurrer to the bill, was a final decree. On appeal from it complainant may assign as error the judgment of the court transferring it to equity. Section 6487, Code; Pearson v. City of Birmingham, 210 Ala. 296, 297, 97 So. 916.

It is assigned as error. When the transfer was made by the court, there was no motion made by either party showing that the cause could not be disposed of by the law court, or that facts existed which were sufficient to give equity jurisdiction.

The order was made as a part of the judgment sustaining demurrer to the complaint. The judgment sustaining the demurrer did not dispose of the cause, but the effect was to eliminate the complaint, so that plaintiff could have amended by filing another complaint. Box v. Metropolitan Life Ins. Co. (Ala.Sup.) --- So. ----. ^[1] So that at the time the order was made, there was nothing before the court which showed that there was an equitable question not available in the cause at law. But if the court should then consider the complaint, for that purpose, though demurrer had been sustained, that was the only matter shown by the record or proceedings to be considered in that connection.

We do not think that any of the counts showed such an equitable question, not equally cognizable at law, where the remedy was not complete. The court may have had the idea that plaintiff could only have relief in equity by way of redemption, or that a trust in the surplus proceeds of the foreclosure sale was created, for...