Moseley v. Ritter

• Decision Date: 06 April 1933
• Docket Number: 6 Div. 255.
• Citation: 148 So. 139,226 Ala. 673
• Parties: MOSELEY v. RITTER et al.
• Court: Alabama Supreme Court

148 So. 139

226 Ala. 673

MOSELEY v. RITTER et al.

6 Div. 255.

Supreme Court of Alabama

April 6, 1933

Rehearing Denied May 25, 1933.

Appeal from Circuit Court, Jefferson County; Wm. M. Walker, Judge.

Bill by N.W. E. Moseley, individually and as administratrix of the estate of J. D. Moseley, deceased, against C. D. Ritter and another. From a decree sustaining a demurrer to the bill and dismissing it, complainant appeals.

Reversed rendered, and remanded.

p>Page Theodore J. Lamar and Walter S. Smith, both of Birmingham, for appellant.

Ritter Wynn & Carmichael and Victor H. Smith, all of Birmingham, for appellees.

KNIGHT Justice.

This case has heretofore appeared in this court. Moseley et al. v. Ritter et al., 224 Ala. 58, 139 So. 94.

After the affirmance of this cause on last appeal, the present appellant, as the widow and personal representative of the deceased mortgagor, J. D. Moseley, filed an amended bill of complaint, in and by which Ida Belle Culpepper Green-theretofore appearing as a cocomplainant with the present appellant-and C. D. Ritter, the purchaser at the foreclosure sale, were made the only parties defendant.

While the cause, as now presented, is not one between pledgor and pledgee, yet the case does present some questions which arise out of a trust relation between the respondent Ritter, as the purchaser of the mortgage premises at the attempted foreclosure sale, and Ida Belle Culpepper Green, the mortgagee, and which questions, under the averments of the bill, necessarily have a bearing upon the main question presented for determination in the cause. And, in addition, a trust relation between said Ritter and the mortgagors was involved in and arose out of, the power of sale contained in the mortgage now before the court. We say between the said Ritter and the mortgagors because said Ritter was a member of the firm of Ritter, Wynn & Carmichael, to whom the mortgage was transferred, and who in fact attempted to exercise the power of sale.

The averments of the bill clearly show that the said Green mortgagee, and the complainant are in full accord and agreement as to the amount due on the mortgage, and have acted in concert in the attempt to regain the property from any claim or demand of Ritter. The fact is, in the original bill they appeared as cocomplainants.

By her amended bill, the complainant attacks the regularity of the proceedings to foreclose the mortgage, and she further insists that there was a perversion of the power of sale in the mortgage from its legitimate purpose to that of oppression of the debtor and the purposes foreign to that for which it was intended.

The prayer of the amended bill is that the complainant be adjudged entitled "to redeem (the property) by exercising the equitable right of redemption, or, if she is mistaken in the premises, that she may be permitted to redeem by exercising the statutory right of redemption." To that end complainant prays for "the ascertainment of the amount that she will be required to pay, and the person or persons and the amount they or either of them shall receive on distribution of the funds," and for general relief. In the eleventh paragraph of the bill, as it now stands, the complainant offers to pay to the proper person, to be ascertained by the court, as legally entitled thereto, such sum as the court shall decree she shall be required to pay and "as to which she is ready, willing and able so to do."

It is made to appear from the bill that the lands conveyed by the mortgagor in question were bought by the complainant and her husband, J. D. Moseley, of the respondent Ida Belle Culpepper Green, and, to secure the payment of a part of the consideration price, the purchasers executed the mortgage now before the court. Thereafter it appears that the said Ida Belle Culpepper Green and her husband became estranged, and divorce proceedings were instituted by the respondent Green against her husband. It appears that in the divorce proceedings the law firm of Ritter, Wynn & Carmichael, of which the respondent Ritter was a member, was retained by and represented, the respondent Green. It also appears that the husband of respondent Green, while the divorce proceedings were pending, and before the debt secured by the mortgage became due, advised the complainant that the indebtedness secured by the mortgage "was his property," and "forbade the complainant to pay unto the said Ida Belle Culpepper Green the said sum claimed by her."

It further appears from the bill that, pending the controversy which had arisen by reason of the claims of the husband of respondent Green, the said Ida Belle Culpepper Green sent the note and mortgage to her attorneys, Ritter, Wynn & Carmichael, who were then representing her in the divorce proceedings. At the same time, the said Ida Belle Culpepper Green executed and forwarded a transfer of the note and mortgage to Ritter, Wynn & Carmichael, which is in the following language:

"For value received, I, the undersigned, Ida B. Culpepper Green, do hereby grant, bargain, sell and transfer to Ritter, Wynn & Carmichael the within mortgage, the debt secured thereby and the notes evidencing said debt.

"[Signed] Ida Belle Culpepper Green.

"Signed, sealed and delivered at Detroit, Michigan, this 27th day of September, 1927, in the presence of

"Earl D. Burke

"Rosa Ottenberg, witnesses."

It is further made to appear from the averments of the bill that the said respondent Green advised the complainant, though subsequent to the foreclosure of the mortgage, that the note and mortgage were forwarded to the law firm of Ritter, Wynn & Carmichael for collection only; that at the time she executed the assignment of the note and mortgage no money was paid to her, nor was there any consideration passing to her, but she conceded that out of the moneys received by said firm it could retain a portion thereof for its legal services; that she had called upon the said law firm and demanded that they make settlement with the complainant and cancel and discharge said mortgage of record; that neither the said law firm nor the said Ritter had ever paid to her any money accruing from the foreclosure; that she repudiated the acts of said law firm. The eighth and ninth paragraphs of the amended bill appear in the report of the case.

It also appears from the bill that the said C. D. Ritter, the purchaser of the property, has not paid either the law firm of Ritter, Wynn & Carmichael nor the said Ida Belle Culpepper Green for said property; that he "attempts to excuse himself to the said Ida Belle Culpepper Green by contending that when he collects the said amount of the mortgage indebtedness from the complainant that he will then remit to her as the collecting agent or attorney."

The bill of complaint, as now framed, shows that the complainant was diligent and earnest in her efforts to pay off the mortgage indebtedness upon her property. And, in view of the fact that both Ida Belle Culpepper Green and her husband claimed to own the debt, the complainant endeavored to intervene in their divorce proceedings to have the court to adjudge who was the rightful owner, so that she could make proper payment. The firm of Ritter, Wynn & Carmichael were the then attorneys for Ida Belle Culpepper Green, and knew of the diligent and honest efforts of the complainant to discharge the mortgage debt. It was during the pendency of the appeal to this court in an attempt to have it determined to whom payment could be rightfully made that the firm of Ritter, Wynn & Carmichael undertook to foreclose the mortgage. At that time the firm well knew that the mortgagor was making diligent, persistent, and earnest effort to discharge the mortgage, and, in the light of these facts, it is clear a foreclosure of the mortgage was unnecessary to enforce the collection of the debt. Notwithstanding these efforts on the part of this complainant to discharge the mortgage debt, the property was advertised and sold. Was this a proper and legitimate exercise of the power of sale contained in the mortgage, or was it an attempt to pervert the power from its legitimate purpose, and to use it for the purpose of oppressing the debtor, or enabling the creditor to acquire the property himself? If it was a perversion or...