*1 Company, Appellant, v. P. Durrett Canton Trust H. Administrator of Estate Oscar Durrett; Ligon, Daniel T. Interpleader. (2d) of Daniel 925. W. Ligon, S.9 One, Division October. 1928. 120,9 *2 d’; appellant. -for Simpson c6 Plummer Hilbert Hilbert Jeffries, *3 Inghram Llewellyn House, Inghram <& <&
H. 8. Brown for re- spondents. petition first count of
LINDSAY, C. The is in ordinary ejectment, possession of 359 form of action acres land County. ownership in Lewis Plaintiff’s claim of situated purchase is founded possession at a March sale deed of trust executed 28,- a p. Durrett, Oscar H. her Durrett hus- plain- of a executed them band, secure tiff. ' petition alleged purchase prop- The second count of possession erty trust, demand for deed of at sale under the give possession, and refusal to that there were premises, defendants’ appointment asked the re- growing crops premises, on the a crops, money to deliver the to harvest such be received ceiver judg- plaintiff, upon court -for benefit of the therefor into final ment; meanwhile, enjoined defendants from interfer- and, restraining issued, ap- A order was receiver therewith. crops deposit pro- pointed net harvested the who Ligón, Ligón, administrator of Daniel T. as Daniel thereof. ceeds *4 claiming grow- by court, interplea, his the deceased, leave of filed by certain crops proceeds thereof virtue of chattel mort- and all given by the decedent defendants. Daniel gages, and a bill to of sale agreed Cynthia P. Durrett. It was that Ligón was father of the Cynthia common source of title. P. Durrett was the September 1922, Cynthia P. Dur- 18, showed that on
The evidence plaintiff promissory note to their and her said husband executed rett years at date, after the same time $5950, in the sum of due four pay- to upon property trust the the executed their of secure deed prior to deed ment of This deed of trust was said note. Boyd, Keokuk, Iowa, given secure
of trust favor of J. 0. of to one $13,000. indebtedness of By by plaintiff, the defendants defendants to the note promised of pay at seven the mentioned “with the rate sum interest per thereon per paid, cent if the interest annum until from date due, be when due,-the shall, same annually or when paid
(cid:127)be at the interest bear principal and part of said become to and added rate.” same n . provision securing note had a said that —“should The deed of trust n pay debt, or refuse the said the said party fail, first said any any part when the same or thereof thereof, interest or iiart according tenor, date and payable to the true shall become due and payable and the whole shall become due and note, then effect of said by force,” provision usual followed this deed shall remain request legal of at of holder the note. of the sale January by On paid was note defendants. No interest said by Durrett, bankrupt Cynthia adjudged was P. 13, -1925,defendant, for the Northern Division of the United States the District Court of the estate of Eastern of Missouri. Schedule of the District said, it listed and included lands bankrupt filed, which, was showing first, deed controversy, thereon, two encumbrances securing an $13,000, indebtedness of Boyd, of trust favor of said plaintiff Sep- of in favor of of date deed trust of and the second the securing note mentioned. tember n application day March, 1925, made On the 3d of plaintiff, for an in behalf of of as holder referee lands, granting for —“an order of trust said second deed described be sold the trustee it the to cause lands trust, satisfying of purpose for the the indebtedness paying expenses the deed trust described after the costs if executing trust, provided surplus any to be Cynthia bankrupt P. trustee estate of Durrett.” applica- principal tion and interest stated that “both on said unpaid; said could due and that real estate not be sold the trustee in rights for its actual value because homestead rights statutory II. P. Durrett Oscar there- Durrett they refused release.” in which had upon defendants of a copy Proof made of the service presenting application notice of the time of and of the same. stating application recites as “that order of referee default has been interest the note in said described, and that the terms and deed of trust conditions principal and said deed of trust both interest on said note is due unpaid.” “Upon application of said The order runs: examination service “things court, found the matters and set it is forth in application the said are true.” *5 was, that —'“the Canton Trust following Company,
The order holder trust, cause said lands to be of the second deed of sold thereunder provided by and conditions of of trust, as is said deed first law, expenses sale; apply proceeds of and next paying costs and payment of interest in said of tru'st of deed sale to the described, the remainder over to be to the trustee bank- required bankruptcy7 that -ruptcy.” The order further the trustee ' report said sale to the court. . 28, 1925, March On the trustee in said of trust deed sold the same’ notice, pursuant, plaintiff purchaser and the became the áhd re- ceived the deed from the trustee under said deed of trust. The (cid:127) purchase price of $3350. amount at said sale was day June,
This suit was filed on the 8th of 1925. The claim made interpleader proceeds crops for the of the grown oh the premises upon was mortgages given by based three chattel defend- Ligón upon crops ants to Daniel growing on the land. The first of 1925; mortgages these 17, chattel was March dated the next March 31, 1925, May 1925, 26, third bill of sale also of growing crops, by defendants Ligón, to said Daniel was dated n - day June, acknowledged of June 1925. The upon couid found ejectment. favor of defendants the count in No Necessarily, declarations of law were asked. the basis of this find- was that $5950 the note for secured the deed trust had terms, was not become due under its and there no default in the interest, payment of or under the terms of the default deed of note; given securing trust of the and that the’ sale Upon premature invalid. thereunder the issue between the plaintiff interpleader, favor in- and the the court found of thé terpleader. presented appeal, As claims the the case order- property of the under the the referee the sale question of res default and deed trust was acliwlicaia right to sell. contention is that the terms Defendant’s agreement default; the sale the note there was no embodied invalid, and that under the deed trust unauthorized and valid an authorized was not referee un-, adjudication plaintiff’s to be sold cause the der the deed of trust. There was no condition in the whereby deed of trust a breach declared,
terms could be other than the condition of failure re- pay fusal to expressed the indebtedness note, “according true tenor, date effect of said note.” The note and trust, deed of together were be construed so that effect inf]y ])e g.jTen †0 ap f,jle possible. terms of both if 0f expressing to the note itself as the condition referred of trust rulings arise. Under the would numerous default which there, State, was under appellate the terms courts cases
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of this note and. of trust, no breach of condition because of paid. fact provide that no interest had been does not The note that annually. paid [Koehring interest shall v. Muemminghoff, be 61 403; Frye v. 200, Mo. Shepherd, App. many 173 Mo. where authorities reviewed; 400, Reed, 406; Wilson v. 270 are cited and Mo. First Kirby, ruling Bank v. W. 926, National 175 S. The in these 929.] rulings cases is in with accord elsewhere instruments of ’ 10 like tenor. Law Reports, page See annotation American 1002. general The all rule deduced from the authorities is there stated: ‘per “The authorities hold annum’ in pro that the term a contract viding payment of a certain rate of per interest is annum, only respect to time, intended as a measure of the rate with and does require annually.” pro not There no interest is question payable in that shall annually, vision the note in interest be due, provision interest, annually not but the is that the when part principal shall, due, added to and become a when be bear interest at same rate. The Wilson v. differs Reed except that in respect, from the here in no this note the words one. “annually.” “or the word The added when due” follow^ w^ordsdo not take it the rule Under the rule the eases cited out stated. maturity collectible before interest the note mortgage hav the note. The condition of the or deed of trust not foreclosure, nor broken, been it was not could the de mortgage before condition broken. dispossessed fendant be under the Reed, 270 authorities The v. Mo. [Wilson cited.] there foregoing govern in the instant un conclusion results and must case der this the rule instruments followed of construction such court it must be held that the order the referee unless w;as adjudication that condition judicata question. broken, ad on that so as be res Avas made in this expressed in note was one The contract performed State; lien was one State and be validity and its State, in this property situated In under the local law. determined to be properly were and effect pro parties such a contract rights of the upon the passing follow the United States courts of the bankruptcy the ceedings in highest v. of the State. [Hiscock court by the declared law as state Ratner, 268 U. S. 37; v. Benedict 359.] S.U. 206 Bank, Varick governing which is the law local it is that fact However, the not con bankruptcy, does court applied be tois law, presented. here issue clusively settle possession of defendant question estate real time of ad- after bankrupt, at and Du’rrett, P. bankrupt at and after by the Possession bankruptcy. judication Remington on bankruptcy court. [5 by the possession is adjudication Bankruptcy (3 Ed.) sec. was in 2365.] custody law. said, “It in general, that jurisdiction general ais court of in bankruptcy matters, judgments, and orders possess decrees all the finality attributes estoppel judgments to domestic emanating accorded from courts general original jurisdiction.” [Remington, sec. “The *7 principle adjudicata res applied of as between federal and state Cyc. courts.” [23 1219.]
This action is to bankruptcy collateral the proceedings and the jurisdiction order of sale had If a therein. existed to make the order, the in order itself cannot be attacked this proceed- collateral ing, pursuant nor thereto, the sale made for mere error of the referee failing apply in law, to in the state rule of determining whether there was a condition. breach of Jurisdiction to does decide not merely correctly. power mean application alleged the decide The principal the interest of note secured by the the deed of finding unpaid. necessary trust was due and This was a be to made mortgagee as a basis for that the should the order cause land the A bankruptcy power be sold under its court has deed. to sell the bankrupt subject property liens, of or the to liens free from or free some to others. “The court of bankruptcy from liens and jurisdiction power dispose property of has encumbered aof bankrupt any in deemed best for the all manner interest of con- ” Bankruptcy (4 Ed.) may cerned. sec. on Such sale [Black 660.] ordy in bankruptcy, had instance of trustee but be “not at the the petition charge may -lien the court to the himself take of creditor property sale, or for leave to conduct the sale him- the and order proving making a self, in either first his debt at least case validity showing priority prima-facie as to the of his lien.” on sec. Bankruptcy, [Black 660.] bankrupt being custody in property
The defendant the the jurisdiction subject to its to de- bankruptcy, court became the summary by proceedings, the nature plenary action as termine conflicting thereto, demanded, claims all adverse or of the case (C. Schermerhorn, Fed. C. lien. re 145 of title or of [In whether validity question as to the A.) and is no There was 341.] property, property by the the of trust held the summary being custody law, bankruptcy the court had bankruptcy proceedings. by orders made jurisdiction [5 it over being property sec. The Remington Bankruptcy, on possession bankrupt possession a custody law, whose validity possession bankruptcy, court summary jurisdiction had being the court question, lien bankruptcy property. the sale prodeedings to order 1216
court, in ordering tbe sale-of of a is not re: bankrupt, by stricted to a sale made may tbe trustee in bankruptcy, but order' such by appointed to be made commissioners sale the court 'or bv an official Bankruptcy, auctioneer. 565; ["Loveland on sec. C. J. may And 236.1 the court authorize mortgagee [Love- foreclose." Bankruptcy, on land mortgagee may secs. 959.1 135. apply summary petition a. for of a foreclosure mcmt- [Brandenburg Bankruptc.v (4 Ed.) gagc. sec. 876.1 general adopted "Under Order XTT of the orders in Supreme States, bv established Court of the United after the order referring "referee, proceedings except, is made the case to “all general such bv are act. or as renuired tbe these orders to had iudge. had before the shall be before referee.” The according bank- instance after and to notice husband, re- and her defendants herein. The order-was runt petition “sett!no- t-iewable bv tbe of tbe.se defendants iud°'e Therein, lav of'.” THule XXVIT.l out error comnlaiued by the decision made erroneous remedv of *8 referee! argument, proceed "for in their written Counsel there, theory was bo breach of condition as measured the that because n State, by may applied in such be now rule rule followed this the They in in this collateral action. and effective the state court that," objection authority support of their contention no cite no
haviug to court the introduction on the trial the "circuit been made trust, deed, ground upon the and and trustee’s the condition, objection such apparent breach there was no "of that it was opportunity.” Such ob-" “timely properly at the first raised was in this court would the rule under before referee followed iection the ruling his would review of adversé thereon timelj^, and have been became, any review, "timely. the order In the absence have been governing law as de- the fact that consideration final. The holding was under court, erred there by this the referee clared condition, which can be corrected not an error a breach of that- law by action, was a breach court. "Whether there this in collateral a. one, by necessary issue, to be determined condition, and a was making order he did make. preliminary to of the the the referee that; finding was of con- a breach a there was made The order entertain, and to proceeding the could which referee dition, in a parties. Wé were these defendants plaintiff which both The order. adjudicada applies to the principle of res the hold that trial, eject- upon the count "finding for defendants "erred ment. bankruptcy subject to took title the land trustee to'the.
The imposed upon it in rights the hands of equities bankrupt. Remington Bankruptcy, trustee, [4 sec. did however,
not take title to bankrupt. the homestead of the validity plaintiff’s of the deed of trust not in dis- pute. land, all of in which, application It covered as the show, bankrupt homestead husband, and her they which to and which had refused release not been set out to them.
The court exempt property, could administer deny right but could not of the mortgagee, under its deed of trust, to concededly to the encumbrance of a carrying mortgage, valid interest. In homestead Collier on Ed.) (13 page Bankruptcy 333, it “While, vol. is said: aas rule, exempt power property, has no sell the the trustee to he must it, inseparable property, where it is sell from other of sale expense by estate; bankrupt general to be borne is then entitled proceeds. Thus, bankrupt’s his of a pro-rata to where all real mortgage mortgagee which the estate is covered would right convey any discharged in fee have the sell and title exemption, mortgagee his claim the and the submits may bankrupt court, and shall his home- it sell the land allot no proceeds, power it has to order the amount to stead from the but mortgagee.” to the Necessarily, mortgagee in un- this case covered the lien of assigned and, right to have homestead, extent of the satis- Foreclosure and sale faction of the indebtedness. of the whole place on March of trust took the land under the deed paramount over- deed of trust was 1925. The lien of the †]1(,(,pattel inter- mortgages bill of sale growing crops from free could not pleader. The defendants giving mortgages of chattel of trust lien of the deed thereon, from the them means free nor the same plain- already passed title had upon land to which *9 W. There Bradley, 288 Hickory v. S. Bank tiff. [Farmers’ crops by This was done growing defendants. no severance subsequent sale of appointed by the receiver superior title take no interpleader could land. The crops passed growing defendants title of sale. court must be reversed judgment of the trial is Our conclusion judg- cause remanded petition, and the counts of the both Ellison, (7(7.,concur. Seddon and plaintiff. ment entered adopted C., opinion foregoing Lindsay, PER CURIAM:—The judges concur. opinion of the court. All as the