Woods v. Sanders

• Decision Date: 17 January 1946
• Docket Number: 6 Div. 378.
• Citation: 247 Ala. 492,25 So.2d 141
• Parties: WOODS v. SANDERS et al.
• Court: Alabama Supreme Court

25 So.2d 141

247 Ala. 492

WOODS v. SANDERS et al.

6 Div. 378.

Supreme Court of Alabama

January 17, 1946

Rehearing Denied March 7, 1946.

Arthur Fite, of Jasper, for appellant.

Pennington & Tweedy, of Jasper, for appellees.

The bill alleges, in substance, that about the year 1921 Oscar Bonner contracted to sell to Bethel Kittle the land described, and Kittle went into possession under his contract of purchase and thereafter sold to complainant his right to purchase the land; that complainant then went into possession of the land and made valuable improvements thereon, including building a house and fence, and digging or boring a well that on December 12, 1923, complainant paid Bonner $132 on the purchase price of the land, and made other payments to him; that complainant borrowed from U.D., or Ulus, Sanders money to finish paying Bonner for the land, arranging for Sanders to pay direct to Bonner and, in order to secure repayment, for Bonner to convey the land to Sanders; that said deed was in equity and in fact executed to Sanders merely as security for debt and had only the effect of a mortgage and was intended as such; that the amount of the purchase price to be paid Bonner was $500, which included the $132 paid by complainant to him; that Sanders collected the rent on said land for some years, with the understanding that such collection should be applied by him as a credit on the amount advanced by him to complainant; that he collected $75 from one Vinson as rent for the year 1934, and $50 for the year 1935; that in this way and otherwise complainant paid to Sanders the full amount advanced by Sanders; that Sanders died about the year 1935 or 1936; that defendant Blanche Sanders is his widow and defendant Jewey Sanders his only child; that they are making claim to said land under the deed made by Bonner to U.D., or Ulus, Sanders, which was executed to-wit, February 10, 1926, but which was intended as security for money advanced, and all of which money had been repaid to said Sanders before his death. It is alleged that defendants are now in possession of the land and have been for some time.

The prayer is that the deed executed by Bonner to Sanders be declared a mortgage or security for money advanced to pay for the land; that the indebtedness secured thereby be declared to have been paid; that said deed be cancelled; that defendants be held accountable for reasonable value of use and rent of the land since said indebtedness was paid; that complainant be adjudged the owner of the land and entitled to possession thereof; and for general relief.

FOSTER Justice.

This is an appeal from a decree sustaining a demurrer to a bill in equity. The equity of the bill is to enforce an equity of redemption in what may be termed a resulting trust to secure the payment of a debt for borrowed money which in equity is treated as a mortgage. Pollak v. Millsap, 219 Ala. 273, 122 So. 16 (7), 65 A.L.R.

110; Moss v. Winston, 218 Ala. 364, 118 So. 739; O'Rear v. O'Rear, 219 Ala. 419, 122 So. 645; Gunter v. Jones, 244 Ala. 251, 13 So.2d 51; O'Rear v. O'Rear, 220 Ala. 85, 123 So. 895; Leonard v. Duncan, 245 Ala. 320, 16 So.2d 879.

The ground of demurrer, which was evidently thought to be good, was one which goes to the statute of limitations. It is well understood that in a suit of this kind, the statute of limitations is ten years as in the nature of a suit for the recovery of land since land is the subject matter of the suit. Miles v. Rhodes, 222 Ala. 208, 131 So. 633; McCoy v. Gentry, 73 Ala. 105.

The rule is that one in possession of land holding the legal title without recognition of the equity sought by another, and without application of the rents and profits, is in hostility and it is adverse to that of the party claiming to do equity, because the one in possession has the legal title. Dixon v. Hayes, 171 Ala. 498, 55 So. 164; Toomer v. VanAntwerp, 238 Ala. 87(11), 189 So. 549, 123 A.L.R. 1064; Ward v. Chambless, 238 Ala. 165(7), 189 So. 890; Coyle v. Wilkins, 57 Ala. 108; Drummond v. Drummond, 232 Ala. 401, 168 So. 428.

The principle has been well recognized in this State, and has been fully observed whether the relation be that of a mortgagor and mortgagee, or where the parties in possession hold a deed which was intended as security for the loan of money as in Richter v. Noll, 128 Ala. 198, 30 So. 740, or where the relation is that of vendor and purchaser. Love v. Butler, 129 Ala. 531, 30 So. 735.

The mortgagee in possession after default having a 'complete legal title' is presumably in the adverse possession of the land, but the possession of the mortgagor is permissive, and the right to foreclosure is not barred for twenty years, when the debt is conclusively presumed to be paid. Coyle v. Wilkins, supra; Staten v. Shumate, 243 Ala. 261, 9 So.2d 751. But both dates begin to run from the date of the last recognition of the right of complainant out of possession.

In Van Antwerp v. Van Antwerp, 242 Ala. 92, 5 So.2d 73, complainant was actively led by defendant to believe that the possession by defendant was in recognition of complainant's rights. It was therefore not adverse until that status was changed. In respect to a mortgagee in possession after default, there is no such status, and the rule is expressly stated to the contrary. His possession is adverse from the date of the last recognition of the existence of a debt.

The bill alleges that the deed was executed on February 10, 1926, by complainant's seller to respondent's ancestor, Sanders, and that it was held as security for a debt for money advanced complainant to pay the balance of the purchase price.

The statute of limitations in such a suit, as we have said, is ten years from the last recognition, by the grantee, of complainant's equity. The bill alleges that such grantee collected the rent for the years 1934 and 1935 under agreement to apply them on the debt, and then he died. The bill was filed October 20, 1944. It would appear therefore that the bill was filed much more than ten years after the execution of the deed, and therefore the burden was upon the complainant to show special matters excusing his delay. Phoenix Chair Co. v. Daniel, 228 Ala. 579, 155 So. 363; Drummond v. Drummond, supra.

The allegation that the grantee collected the rent for the years 1934 and 1935 means that payment was made and collected during those years, not in advance, when considered upon a demurrer merely that it shows a bar of the ten year statute of limitations. The demurrer did not direct attention to the fact that payment in advance of 1935 for 1935 may be consistent with those allegations. Had that been done probably a more specific allegation that the 1935 rent was paid in 1935 should have been made. If the collection was made in 1935, it occurred within the ten year period immediately preceding the filing of the bill, and would be sufficient to relieve the claim from the bar of the statute. We do not think the bill is subject to the demurrer addressed to it on that or other ground.

The decree of the trial court is reversed, and one here rendered overruling the demurrer and allowing respondent thirty days in which to answer the bill, and the cause remanded.

Reversed, rendered and remanded.

GARDNER C. J., and LAWSON and S...