20 S.E. 624 | N.C. | 1894
On a previous investigation of this case, we were of the opinion that the decision in Joyner v. Farmer,
Now, if this be the rule applicable to a direct purchase of the equity of redemption, why should it not also apply to a case like the one before us, where the mortgagor has by his deed expressly authorized the mortgagee to become the purchaser? If the mortgagee can directly purchase, if the transaction is fair, why can he not, when the transaction is fair, purchase as the highest bidder at the sale, when expressly authorized to do so? In 1 Jones on Mortgages, 1883, provisions of this kind are said to be in general use where there is no statute authorizing the mortgagee to purchase at his own sale, and cases are cited which deny that the privilege should be strictly construed, and the author remarks that it is generally held that "under such a provision the court will not interfere with a purchase by the mortgagee unless there be some other objection which would invalidate a purchase by any one else under the same circumstances."
On the other hand, while the right to purchase is fully recognized, there are numerous authorities to the effect that the mortgagee so purchasing "will be held by a court of equity to the strictest good faith and the utmost diligence in the execution of the power for the protection of the rights of the mortgagor, and his failure in either particular will give occasion to allow the mortgagor to redeem."
In Fox v. Mackrith, 1 White Tudor, L. C., 244, note, it is said: "The mortgagor may indeed dispense with the restraint by authorizing the mortgagee to sell to himself, if he is the highest bidder. This results from the right of every man to waive a rule intended for his benefit. But such transactions will, notwithstanding, be closely scrutinized, and may be set aside if the sale is not conducted with entire (473) frankness, and in a way to obtain the market value." *322
In Gibson v. Barbour,
These remarks seem to recognize the right of the mortgagee to purchase under the circumstances of this case, and the numerous authorities cited by Mr. Jones from courts of the highest respectability, such as New York, Massachusetts and Alabama, as well as the "reason of the thing," in our opinion, fully establish the proposition. In passing, we will observe that Howell v. Pool,
The mortgagor, in effect, says: "You may sell my land to the highest bidder, and if you act fairly and purchase at a reasonable price you may yourself become the purchaser." If this agreement is honestly carried out, why should the mortgagor have the right to repudiate it, and especially in the present case, when he has surrendered the possession after such sale, and the defendant has occupied the land for over five years?
The referee finds that the "sale was fairly and honestly conducted, in conformity to the terms of the mortgage and trust deeds, and there was no effort to suppress the bidding. The land brought a fair price. There were no circumstances of fraud or undue advantage taken." The right to purchase having been conferred upon the mortgagee, we think our *323 case is not within the principle that the mortgagor may avoid the sale, even though it be fair and the price reasonable.
Under this view, the defendant had a right to acquire the equity of redemption by virtue of the sale under the mortgage and, this being so, the principle of Taylor v. Heggie,
Affirmed.
Cited: Tuttle v. Tuttle,