Moorer v. Tensaw Land & Timber Co.

• Citation: 251 Ala. 576,38 So.2d 586
• Decision Date: 13 January 1949
• Docket Number: 1 Div. 312.
• Court: Alabama Supreme Court
• Parties: MOORER v. TENSAW LAND & TIMBER CO., Inc.

38 So.2d 586

251 Ala. 576

MOORER v. TENSAW LAND & TIMBER CO., Inc.

1 Div. 312.

Supreme Court of Alabama

January 13, 1949

Rehearing Denied Feb. 17, 1949.

Caffey Gallalee & Caffey, of Mobile, for appellant.

Gaillard & Gaillard, of Mobile, for appellee.

SIMPSON Justice.

It was held in Moorer v. Tensaw Land & Timber Co., 246 Ala. 223 20 So.2d 105, where the instant parties were in litigation over the same subject matter, that the deed executed by Everett & Boykin to Taylor, Lowenstein & Co., under date of February 25, 1922, and the contemporaneously executed written contract between the parties stipulating that the deed was executed as security for certain indebtedness therein described constituted a mortgage on the lands embraced in the deed in the hands of Taylor, Lowenstein &amp Co. and anyone standing in their shoes.

Taylor, Lowenstein & Co., on February 3, 1941, conveyed by quitclaim deed the said lands to appellant, Moorer, who on January 8, 1945, filed this suit to declare the instruments a mortgage and to foreclose. Several defenses were asserted but the plea of payment, we think, was satisfactorily established, justifying the decree of the lower court in dismissing the bill, as we will undertake to show. Discussion, therefore, will be limited to this single phase of the case.

The partnership of Everett & Boykin for many years prior to 1935 was a producer of naval stores and lumber in several southwest Alabama counties and, in the transaction of such business, was dependent on Taylor, Lowenstein & Co. (referred to as company), merchants and wholesale dealers in naval stores, for advances of money and supplies for these purposes. This business between the parties gave rise to the execution of the deed-mortgage considered in the first Moorer Case, supra, for which this suit seeks foreclosure. The amount due Taylor, Lowenstein & Co. on February 25, 1922, under and by virtue of any notes, contracts or agreements of the partnership then in effect, when the mortgage was given, was $54,743.36, as shown by the books of both the Company and the partnership. The defense of payment, here considered, was rested on the contention that the mortgage (expressed in the contemporaneous written contract) only secured that debt and that, being antecedent to subsequent advances to the partnership, it was thereafter paid by subsequently delivered naval stores and proceeds from timber and land sales years before appellant received his quitclaim deed in 1941.

We think the contract, interpreted in connection with the course of dealings and conduct of the parties throughout the many years, fully sustains such a construction and are advised in briefs that such was the trial court's view of the case.

The appellant, on the other hand, contends that the deed-mortgage is still in fieri and unpaid; that the mortgage was intended to secure not only indebtedness of the partnership under then existing contracts, but also subsequently accruing indebtedness arising from future advances made by the company to the partnership. We must reject this view.

The mortgage feature of the documents, here pertinent on the question of the character of debt secured, is stated in the contract and shows plainly to our minds that it was contemplated to secure the then existing obligations of the partnership, that is, debts due and to become due under then existing notes and contracts; and so limited, secured only the $54,743.36 due when the documents were executed. This interpretation was also borne out by the testimony of the former partner, Mr. Boykin, and the partnership's head bookkeeper and office manager at that time, Mr. Lucas, neither of whom appears to have had any interest in the instant litigation. Such interpretation seems to have been assumed by Taylor, Lowenstein & Co.--as evidenced, total non-action under the instruments--and is also extractable from the specific language of the contract which, after the preamble, expresses the agreement as follows:

'It is therefore, understood and agreed between the parties hereto, that said conveyance [deed dated February 25, 1922] this day made to party of the first part by parties of the second part, is for the purpose of securing any indebtedness now due party of the first part by parties of the second part, or that may become due in future, under and by virtue of any notes, contracts or agreements now in effect between the parties hereto.' (Emphasis supplied)

Boiled down, the salient facts are: Taylor, Lowenstein & Co. kept on its ledger a general running account against the partnership of Everett and Boykin dating as far back as June 30, 1918, which was continued until June 13, 1927, when Everett died, and thereafter during the operation of the business by Boykin, the surviving partner and executor of the estate of Everett, until as late as June 30, 1935, about which time the business between them seems to have come to an end. Everett & Boykin kept a similar account on their ledger based on statements periodically received by them from the company. In the operation of their business of selling lands and timber and producing naval stores, Everett & Boykin would, as sales were made and stores produced, deliver the proceeds from such sales and the garnered naval stores to the company, which would enter the credits on the running account, the products received being credited at the market quotations as of the date received. We are unable to determine in many instances whether the entries on the running account kept by Taylor, Lowenstein & Co. for sales made were accruals from lumber, timber or naval stores. And in like manner the debits against Everett & Boykin on the running account give no clue as to the character of advances made, whether supplies furnished or monies advanced. The account is voluminous and undoubtedly shows that as advances were made by the company they were entered as debits thereon and as payments were made to the company in money and stores delivered, these items were credited on the account generally. No special application of payments to any particular item of debt or class of debts was made nor was there any earmarking or segregation or specification of any particular debit charge or class of debit charges. As creditor, the company could have elected to have applied the credits in the manner desired if seasonably exercised. But it did not do so. A careful study of the case convinces us that what the company apparently elected to do was to submerge the various items of debit, including that part of the general running account secured by the mortgage, into one common debt represented by the sum total shown to be due by the running account, applying generally the credits of money paid and stores delivered by Everett & Boykin to this general running account.

The character of account...