Union Bank & Trust Co. v. Royall

• Decision Date: 11 May 1933
• Docket Number: 3 Div. 51.
• Citation: 226 Ala. 670,148 So. 399
• Parties: UNION BANK & TRUST CO. v. ROYALL.
• Court: Alabama Supreme Court

148 So. 399

226 Ala. 670

UNION BANK & TRUST CO. v. ROYALL.

3 Div. 51.

Supreme Court of Alabama

May 11, 1933

Rehearing Denied May 25, 1933.

Appeal from Circuit Court, Montgomery County; Walter B. Jones Judge.

Action in assumpsit by Dora C. Royall against the Union Bank & Trust Company. From a judgment for plaintiff, defendant appeals.

Affirmed.

Hill Hill, Whiting, Thomas & Rives, of Montgomery, for appellant.

Ball &amp Ball, of Montgomery, for appellee.

BROWN Justice.

This is an action of assumpsit by the transferee and holder of a second mortgage against the prior mortgagee, who foreclosed the first mortgage under the power of sale therein and became the purchaser of the mortgaged property, to recover the balance of the purchase price, over and above the mortgage debt, the interest thereon, and the legal cost and charges incurred in the foreclosure.

The evidence is without dispute that the first mortgage was foreclosed in strict compliance with the power of sale; that the foreclosure was conducted by the attorney and agent of the mortgagee; that the mortgagee became the purchaser of the property at the foreclosure sale, and that the attorney of the mortgagee who conducted the sale executed to the purchaser a foreclosure deed, for and in the name of the mortgagors, in pursuance of the expressed power written into the face of the mortgage, and by the attorney as "The person making said sale," in which it was recited "* * * At said sale Union Bank & Trust Company was the highest bidder for cash, at and for the sum of Forty-four Thousand Two Hundred Thirty-seven & 91/100 Dollars ($44,237.91), and said property was knocked down to said Union Bank & Trust Company. Now, therefore, in consideration of the premises and the said sum of Forty-four Thousand Two Hundred Thirty-seven & 91/100 Dollars to me cash in hand paid, the receipt of which is hereby acknowledged, I, Walton H. Hill, the person making said sale and acting strictly under the power of sale contained in said mortgage, do hereby, in the name of Frank Stollenwerck and Dixie O. Stollenwerck, and in my own name as aforesaid, grant, bargain, sell and convey to said Union Bank & Trust Company all the right, title, interest, claim and estate which the said Frank Stollenwerck and Dixie O. Stollenwerck have," etc.

The language of the power of attorney to execute the deed embodied in the mortgage is: "In the event of such sale, the said Union Bank & Trust Co., its successors, assigns, agents, and attorneys are hereby authorized and empowered to purchase the said property the same as if they were strangers to this conveyance, and the auctioneer or person making the sale is hereby empowered and directed to make and execute a deed to the purchaser in our names." (Italics supplied.)

The provision in the mortgage for the disposition of the proceeds is: "* * * And out of the proceeds of said sale they shall first pay all expenses incident thereto, together with a reasonable attorney's fee, then retain enough to pay said note and interest thereon, and the balance, if any, pay over to Frank Stollenwerck." (Italics supplied.)

The items constituting the recited consideration in the foreclosure deed, were the principal debt, the interest, taxes paid, which by the terms of the mortgage were made a part of the debt, the interest thereon amounting in the aggregate to $40,191.64, cost of advertising $24.64, and attorney's fee $4,021.63, making a total of $44,237.91. The foreclosure deed was delivered and recorded.

The plaintiff offered evidence showing that a reasonable attorney's fee for the foreclosure was from $500 to $1,250.

The evidence also shows that on the mortgagors' request for an itemized statement of the amount necessary to redeem, the defendant included in said statement the item of $4,021.63, as attorney's fee for foreclosure.

The defendant offered the note evidencing the debt secured by the mortgage, stipulating for an attorney's fee of 10 per cent. of the principal and interest "in the event the same is not paid at maturity and is put in the hands of an attorney for collection."

The witness Hill testified: "That witness cried the property off at public auction by reading the notice that he had with him and called for bids on the property. That the Union Bank & Trust Company, acting by and through Mr. Keyton, bid on the property. That in bidding in the property Mr. Keyton said 'I bid the actual amount of money due this bank, together with interest and expenses.' That Mr. Keyton did not say anything further in making his bid. That he and Mr. Keyton then looked for the memorandum which showed what that amount was but witness didn't have it in the file down on the Square at the time but it had been left on his desk in his office. That witness didn't have the memorandum showing the figures at the sale to show the amount due. That Mr. Keyton said in making the bid: 'I have already furnished the figures to Miss Burns' and witness told him that when he went back to his office he would insert the whole bill in the blanks in the foreclosure deed or figure up the amount due. That witness then called Mr. Keyton's attention to the fact that he had not included some other expenses, the advertising bill, which Mr. Keyton didn't know the amount of. That the figure placed in the foreclosure deed shown him was $44,237.91. That the amount was filled in after the foreclosure deed had been prepared. That witness had the deed with him thinking he had the figures along. That he carried the deed to Court Square but didn't have the amount and blanks were left in the deed for the amount. That Mr. Keyton in making the bid said: ' I bid the actual amount due this bank, plus the expenses."' That when witness returned to his desk and got the memorandum he added to Keyton's statement the advertising expenses of $24.64, and this changed the amount to $40,216.28, "and he thereupon added in accordance with the terms of the notes, a ten per cent. attorney's fee. * * * That Mr. Keyton did say he would bid the amount, the...