*1 TEEM, SEEING 1911. O.] Jones v.
ANDERSON A. JONES F. WILLIAMS et al.
(Filed May, 1911.) Mortgages—Suit 1. Lis Property. Foreclosure —Situs of Pendens — buys note, mortgage securing it, One -who a and a of land dur- ing pendency of a suit and for the foreclosure of another mortgage county situated, on the same land in the wherein it is proper complaint therein, acquires and after is filed his interest mortgage purchased by subject the note and so him to judgment may pending action, be obtained in the the doc- pendens being applicable. trine of lis Formality. 2. Same — brought mortgage When a suit is for the foreclosure of a county situated, where the lands embraced therein are dealing mortgagor sufficient notice to respect those with the to land; filing required and the of a formal lis pendens is not charge purchaser to a with such notice. — Mortgages Equities—Legal 3. Title —Foreclosure—Parties. Liens — junior mortgagee judgment A is not bound obtained mortgage a suit a senior for the foreclosure of a on suit, lands unless he has been made a to that and he will right redeem, though pur- not be barred of his not for some poses necessary party thereto; and it can make no difference that, State, legal passes mortgagee, in this regarded security. is not as a mere Rights Acquired 4. Decisions — —Reversal. acquired upon Titles or vested interests the faith of decisions generally of this Court will not be disturbed or the prejudiced by subsequent reversal thereof. — — — — Mortgages Mortgagee Rights Decrees, 5. Junior Parties Effect of. junior mortgagees The doctrine that will not be bound in a obtained suit for the foreclosure of a mort- senior gage, only thereto, unless were made has reference mortgages as have had their recorded our registration laws. Equitable Mortgages Procedure. Sale — —Power equitable power of a court foreclose is not therein; from the of sale contained derived when mortgagee applies foreclose, pursues its the court to the court practice restraint, own course without so to administer the parties according procedure. and its law own THE IN SUPREME COURT.
JONES V. WILLIAMS. Mortgages Transfer—Legal Title. — *2 mortgage securing The mere transfer of a note and it does legal lands, power not transfer the title to or the of sale con- mortgage. tained in the Mortgages Legal Equity—Foreclosure. 8. Title —Power of — Sale — legal mortgaged upon lands, When the title of there mortgages, mortgagee, in were several the first who was party foreclosure, to a for suit a sale under the decree of fore- cannot have the closure same force and effect as had been power made under the in contained the instrument. Equity—Bidder—“Proposer"—Confirmation— 9. Foreclosure Sales — Party —Decree. property in at a One who bids sale under a decree of fore- proposer legally accepted closure is a mere confirmed, until his bid is and party and when made a after his bid and before con- firmation, prior to a suit subject foreclosure of con- which he had notice, structive he is to and bound the final decree that suit. Mortgages Legal Parties—Equities— 10. —Foreclosure Sales — Title — Account. junior mortgagee party When a is not a to a foreclosure suit equity brought by assignee mortgage, aof senior the effect deprive redemption, of the decree is not to Mm of his purchaser subject and at the sale under such a decree takes may him, right to his lien for whatever sum be due and to his redemption; and order to ascertain the status and.amount claims an taken. several account be — Equity— Mortgages Third interested Parties — —Foreclosure Hearings. Persons — Where there is the of a under contained, vigilant protect sale therein third must be interest, judicial proceeding, simply their as it is not a but adopted by method to enforce the lien. Appeal Whedbee, J., from at tlie November Term, 1910, DupliN. action was brought by plaintiff
Tbis to foreclose a mort- land., on a tract of gage containing originally acres, executed defendants, to him the Branch wife, Rufus secure a therein described. The debt of other defendant, Fred $379.50 under the trading name and of E. Martin, style J. Martin & made a as Rufus Branch Son, was and wife had also TERM, SPRING O.]
Jorras v. Williams. bim be bis notes and mortgaged assigned tbe land to bad co-defendant, following to bis A. F. "Williams. Tbe mortgages facts tbe Summons was issued on 24 appear December, case: Martin, in behalf of tbe Fred 1903, plaintiff trading tbe firm name and of E. Martin & Rufus style Son, J. wife, Branch and Christiana and was served 18 Janu- Branch, on Rufus Branch and 1904, wife, Branch, Christiana ary, 1904, on Fred Martin. and answer were January, Complaint F. filed, Term, 1904, and at tbe March A. duly upon affidavit, was made a defendant, having Williams purchased two of E. J. Martin & Son. At mortgage^ August Term, 1904, Williams, an order was made summons to issue to A. F. directing and on summons Tbe October, was served bim. 1904, Jones, Anderson sold to tbe defendant plaintiff, *3 Rufus Branch a tract of 245 land and tbe containing acres, 16 latter made various on which payments up January, 1902, Rufus Branch and wife executed their date to Anderson Jones tbe tract mortgage upon of land to tbe balance of tbe secure of $379.50, which was recorded purchase money mortgage duly on 24 1902. In October, of tbe part payment purchase price on said tract of Branch 23 land, wife, November, Rufus and on to Anderson Jones of tbe 245-acre reeonveyed forty-six deed, tract of land which was by duly November, recorded on 17 1902. 30 Rufus October, 1901, On Branch and wife executed a deed to Fred E. J. Martin & mortgage Martin, trading Son, as to secure an $328 indebtedness of on the 245-acre tract of land, which was 2 November, recorded on 1901. On duly 1902, Rufus Branch January, and wife executed to Fred Martin, trading aforesaid, the 245-acre mortgage upon tract of land to secure an indebtedness of $250, duly was recorded 25 January, March, On F. Williams 1904, A. an commenced action in the Court of Superior County Duplin wife, Rufus Branch and the mortgage foreclose to him Fred assigned by Martin, and Branch and wife filed no answer. At the August Term, 1904, court rendered a judg- ment ordering sold, land to be and the land was sold aby commissioner and A. F. bought a final Williams, decree entered at the November Term, 1904, the sale confirming IN THE SUPEEME COURT.
Jones v. Williams. authorizing purchase of the-land to be credited on price Williams’ him directing a deed to be made to for the land. A deed was made and registered November,
Anderson Jones alleged that the complaint defendant. Branch, Eufus executed to him the on the land to secure the purchase and was indebted him money, on that account in the sum of $544.50, and also that he had alleged pur- chased the forty-six acre tract, describing bounds, metes and $150 him paid for the same, and received a deed therefor. He also alleged that the defendant, Eufus Branch, executed to E. J. & Martin Son the notes and mortgages hereinbefore described, and that the defendant A. E. Williams purchased notes and mortgages after were due and since the institu- tion of this action and while the was pending, same and that the defendant A. E. Williams went into the possession of all the land except the forty-six acres, and received the rents and profits therefrom, and asked for an and a accounting of the land off pay both debts. It is admitted that the defendant A. E. Williams became the owner of the notes and mortgages of Fred Martin, executed to him Eufus Branch and wife, after the maturity of the notes and mortgages. It is also admitted that A. F. Williams been in possession has of the 199 acres of land since the notes and mortgages were signed to him Martin, receiving rents and profits. The evidence showed the annual rental value of the 199 acres of land $100, was and the annual rental of the forty-six $35. acres was
It was admitted A. that F. Williams commenced the action against Eufus Branch and wife after he had been made a party to this suit order of the court, although summons was not served him until 5 October, 1904. The court submitted to certain jury issues, which with the answers thereto are as follows:
1. What amount, if anything, due Anderson Jones on account of his notes and mortgage executed by Eufus Branch and wife? Answer: $379.50, with interest from 1 November, 1902, subject to credit of $16.24 made 1 November, 1902. sum, What if is due anything, upon the mortgage assigned TERM, SPRING O.]
Jorres v. Wiixxams. $250, Answer: with E. J. Martin & Son? F. to A. Williams sub- from 16 until January, paid, cent per interest six with, 1902; $164, December, $13.91 to a credit of made ject with, $328, October, 1901; cent from per interest at six until October, 1901, cent from 30 paid. interest at six per entitled to A. E. Williams the owner and 3. Is the defendant An- land in the complaint? of all the described possession swer: Yes. rental value of the acres of forty-six
4. What is the annual $35. Answer: complaint? land mentioned at the request plain- two issues were submitted The first and fourth he and tendered the fol- tiff, excepted and to the third issue: What is the annual rental valúe lowing additional defend- of land which has been of the possession acres this issue and ant A. E. Williams ? court refused to submit and so that no view of the evidence was held, adjudged, acres, entitled to recover with plaintiff respect forty-six either the land or interest therein, charged jury answer third evidence, believed the should that, they further matter of that the issue, held, law, Yes. The court not entitled and the defendant plaintiff was rents and profits Williams was not liable account for the had received while in of the 199 acres of he possession land. the several were taken Exceptions duly by plaintiff rulings court. It was the verdict adjudged upon A. land, is, E. Williams is the owner of all the the 245 acres, and that he recover of the same from the possession plain- tiff, $175, with the rental value of the acres. Plaintiff forty-six excepted appealed.
Stevens, & Beasley plaintiff. 'Weeks for
W. S. O’B. Robinson & Son for defendant. Walker, J., after the case. think it stating may fairly We be inferred A. E. bought from the record that Williams notes and the from Ered Martin mortgages during pendency of this after the action and had been filed therein. complaint If so, his interest them acquired subject any judgment herein, rendered would be a Us complete pendens. this suit
184 IN THE SUPREME COURT. v. Williams.
Jones law rule that no decree Lord Bacon stated the common to be bona, in of the de conveyance bindeth that cometh any fide and is made no neither exhibiteth, fendant before the bill Hie, or but when he comes in and while order; pendente bill is in full and without order of allow suit prosecution, ance or then the decree bindeth. privity by court, regularly This rule had its civil and was origin law, pungently lite, 4 legal maxim, stated nihil innovetur: pendente Works, Bacon’s Sir William Grant said in p. Bishop of Paine, Winchester v. 11 194-201, that “he who Vesey, purchases during the is bound pendency suit, may the decree be made against from whom he person title; derives the litigating from the exempted necessity taking any notice of a title so as to them it is acquired; no such title existed, otherwise suits be interminable, or, would which would effect, same would be the of one pleasure party period what the suit be determined. The should rule some n conveniencerequires times operate with hardship, general but it.” Wiltsie Mortgage Foreclosures, sec. and notes. It may therefore be taken as well settled that judgment in an action in rem or one to foreclose a mortgage binds not only and their actually litigating but privies, also all others claiming deriving under them aby transfer lite. The pendente a formal filing pendens lis is not required the application of this recognized when principle the suit is in the brought Duncan, where the county land is situated. v. Dancy C., 96 N. Brown, 111; v. Collingwood C.,N. v. 362; Hinton, Overton C.,N. 2; Harris v. Davenport, 697; Morgan Bostic, ibid., 743; Pell’s Revisal, sec. 460 and notes; sec. Wiltsie, 40. While the facts relating to the Us pendens are not very set out clearly we record, think it sufficiently appears that E.A. Williams was a purchaser pendente lite, and must be held bound action, this but there is another ques tion raised in which we think case was decided. erroneously Our decision is based upon grounds. both
The defendant Williams failed to make the plaintiff, who was a junior encumbrancer, a suit brought himby Branch, Rufus the mortgagor. The plaintiff is ' *6 TERM, SPRING- 0.]
Jones v. Williams. in not bound the and that proceedings therefore lien was not affected In thereby. ease and bis land upon of this in section that treating question, Wiltsie, says persons in redemption by who hare an interest acquired equity encumbrance, such as a to the execution of mortgage, subsequent under are to the foreclosure, necessarily parties foreclosure suit in order their claims. “The extinguish theory to of the law that an a is, encumbrance is pledge equity for the and the lienor an debt, gives interest equitable mortgaged As the owner of the an premises. equity may, by absolute his conveyance, interest, transfer entire and thereby make his transferee a as we have he necessary party, seen, so can on the same a principle pledge, by mortgage, judgment
otherwise, a
or the
part
whole of his interest
the premises,
and
render the
thereby
encumbrancer a
necessary
order
out his
wipe
Though
interest.
a lienor does not
acquire
fee title to the
an interest
equity,
acquires
the premises
statutes of the various
have
established,
States
long
and which the courts have
long recognized
sustained; and
which parties,
with the
dealing
cannot
premises,
ignore, except
at their own
He
peril.”
thus sums
the law
the sub
up
: “All
ject
authorities in all countries
mortgages
where
are fore
closed by equitable actions,
agreed
subsequent
junior
mortgagees are necessary
to the foreclosure of a
in order
extinguish
and cut off their liens. The
action can be
without them,
sustained
but a defective title would
be offered at the sale which no court would
a bidder to
compel
The rule
accept.
has long been settled that in a bill to foreclose
mortgage,
encumbrancers not made
to the
suit, are not barred or affected
If
decree.
mort
gagee is omitted as a
his
remedy is to redeem from the
foreclosure.” Wiltsie, sec. 61. He cites numerous
and well considered cases to sustain his views.
In
v.
Gage
Brewster,
was, therefore, entitled redeem, precisely though no such action had been brought, namely, by paying mortgage debt COURT. THE SUPREME IN v. Williams.
Jones the equity extinguish . . seeking . When and interest. was his sale, to a bring premises and to redemption belonged. redemption to whom to ascertain duty it had mortgage, sale or of transfer subject It was the were mortgages mortgaged plaintiff, been actually Wheeler, 28 N. J. Eq., was said Gould on record.” So it fore to a decree would be entitled 541: “The complainant her bill that fact that it appears by but for sale, closure and who is encumbrancer, mortgagee, is a subsequent there *7 necessary party. is a mortgagee to the suit. That made a party sale of for foreclosure and who comes into court mortgagee A to omit, as liberty parties not at mortgaged premises, subsequent encumbrances those who hold the proceedings, the holders of all encumbrances is, The rule that general own. must be made commencing par time of the suit existing at the Lambert, Johns., 4 193; sec. Ensworth v. ties. Story’s Eq. Pl., I on Mort 530; v. 1 C. Fisher Paynter, Adams Col. 605; ch. 556. that if be not made 554, they parties, It is true gages, no that them, are of no avail but against the proceedings mortgaged for foreclosure and sale of making reason for suit an to the rule of exception general equity, premises It is in interest to the suit. parties that all be requires persons all unjust proceeds interested manifestly persons be made sub the sale of the that the sale mortgaged premises, outstanding right redeem, invariably to an ject The amended by the sale. bill must be inevitably prejudices third given (the the holder of the Stewart making and the court, and must be into mortgage) brought him. In the mean regularly cause be proceeded will are Mur time the suit be Cases stayed.” directly point Brenham, Farwell, Cal., 40 v. 9 v. phy Wis., 102; Carpenter v. Johnson v. 110 221; Hosford, Ind., 572; County Floyd Johnson, 24; v. 30 Iowa, 160; St., 57 Stewart Ohio Cheney, Hambleton, v. D. M. & T. Md., 378; Johnson v. 52 Watson Co., 12 14 474; Minn., v. Oregon, Rogers Holyoke, Investment v. 4 v. 58 Chapman, Conn., 344; Hodgen Gutlery, Smith 220; The last cited is like the case at bar Ill., strikingly case Hall, 11 In Hall v. Texas, facts. after- (approved its TERM, SPRING N. 0.]
Jones v. “All persons it is said: Texas, 7), wards in Mills Traylor, made should be an interest in tbe liaving redemption whether encumbrancers, If to a bill of foreclosure. parties of fore or are not made the decree parties, subsequent, would not. closure does not bind as also decree them, The are not because their bound, prior encumbrancers The subsequent to those of the paramount foreclosing party. encumbrancers are not their interest would other bound, because or concluded, wise be without an to assert opportunity protect them. In the case now under the lands were consideration, sold to the subsequent to the appellees appellants, held, that the took the appellees subject to property should, however, encumbrance. not have been They pre cluded or affected had their absence and proceeding Cotrell, without notice.” In crane v. the Court Neb., 646, “The and said: were not made applied principle plaintiffs to the foreclosure suit, and were not bound those pro The mere fact that had notice of its ceedings. pendency not make them did bind them the decree. This is elementary. foreclosure and sale were therefore utterly ineffectual to bar A plaintiff’s mortgage. who has not been made a proceeding foreclosing the *8 has mortgage senior thereafter a to redeem from right (the senior purchaser judicial sale). (Renard Brown, when foreclosure was Neb., Therefore, v. this 449.) case, the facts demanded that present properly pleaded their re-estab merely having instead plaintiffs, the Stoddar mortgage. should be redeem lished, permitted any relief, the court denied this relief and denied Why plaintiffs did the record does not inform us. . . . If he (Stoddar) he mortgage, not know of when took the plaintiffs’ rights them within a few thereafter. At the time very days learned in which he of the foreclosure sale this suit was very pending law had full of all the facts. A mistake of He party. notice R., him.” The in Howard v. R. Court, would not protect S., by U. held while the can 837, proceed that senior alone, suit to foreclose and in that sense against mortgagor lienor or encumbrancer not a necessary party, subsequent ' IN THE SUPREME COURT. JoNes v. or dis as to supersede tbe latter is not so binding upon
decree encum- as a second right, it left bim still tbe lien, bis but place by is not lost right be do if bis may wbicb brancer, redeem, Jus encumbrancers,” says “Subsequent of time. lapse laches “when not made tbe Clifford, opinion, tice who delivered decree; are not bound tbe sale, by for foreclosure or to a bill when it is held that degree in tbe least that rule violated nor is as that consequence defendants is paramount, tbe title tbe under wbicb judgment tbe lien of tbe flows from tbe fact that wbicb tbe plaintiff claim to that under tbe defendants is prior bad to tbe Whatever tbe plaintiff claims bis title. title, tbe defendants gives paramount equity other sale or has, wholly unimpeacbed by be still of time or laches. Pro lapse are barred cause, unless not affect bis cess tbe under that decree could plaintiff tbe consequently as be was not a to tbe rights, party proceeding, lien of still remained full force. Even tbe bis bad been made a party proceeding, only tbe plaintiff would have 'been to cut off bis equity redemption, effect be was not made a bis is not redemption Tbe counsel of defendant John extinguished.” Williams, Mr. in his excellent and also at tbe bar in bis well Robinson, brief, and forceful tbe cases: prepared argument, following relied on Co., v. v. Kornegay C., 115; Steamboat 107 N. Lumber Co. Co., Kerr, Hotel 109 N. Williams v. C., 658; Johnson, 126 N. and contended that it C., 64; Gammon that a bad been decided them second encumbrancer is not necessary foreclosure suit tbe first lien-holder or conceded, This be tbe deduction drawn mortgagee. yet that be will be barred of bis therefrom, right redeem, is warranted. not a in tbe We have said be is necessary party, sense that decree will void without bim as to those who but be is entitled to and we think parties, clearly redeem Johnson, v. Kerr Court, that tbe Williams and Gammon v. as we have it. In tbe approves principle stated last ease *9 be mentioned said to be a or at least a necessary, proper, party adjustment order to have a of complete rights of- all further, interested tbe court ex mero persons, should SPRING TERM, N. O.] v. Williams.
Jokes
so as
conclude
brought
motu
Mm to be
require
by process
of
was
mortgagor
Mm.
v. Kerr the
the
assignee
In Williams
the
by
suit,
for
to be affected
held,
special reasons,
In
a lis
bound
orders and decrees.
pendens,
as
its
cases,
the
Lumber
Court had under
Kornegay
Company
the
the
of a
of
lien,
statute,
consideration
the
priority
In
mechanic or material-man.
none of those
as we read
cases,
them,
question
and understand
was
raised which is
precise
now before
and we
that all
decision,
us
think
those cases may
with
be reconciled
what we have hereinbefore said as to the
effect of a decree
encumbrancer not
upon junior
party to the
Moore,
Pitt
foreclosure sale.
85. There is noth
Adrian,
ing decided in Hinson v.
We there decided in nothing those cases in conflict with our present ruling, but if had anything been so decided, we would unhesitatingly it, refuse follow in view of the great weight authority other unless way, compelled to do so be cause it involve a question title. But we are not con fronted situation. If we have decided in any ease very question presented contrary what we now decide, will be precedent controlling so far to protect any titles *10 THE SUPREME COURT. IN Williams.
Jones of the faith acquired upon which have been or interests vested of this Court the decisions right upon to act it. Parties have the the or not disturbed titles will be titles, and such in acquiring We of the decision. reversal subsequent aby parties prejudiced R., 539; v. R. N. C., in cases: Hill two recent have so held an Brown, based upon a rule is 144 N. 117. Such Hill v. just perpet and should be maxim the is one law, ancient of we Further, 35.- (8 Ed.), p. 34, Maxims Legal uated. Broom’s to a not apply of this decision will will that the say principle This registered. is not whose subsequent If would intolerable. to such case be application rule take from must registration, deeds withhold their law abhors secret their own neglect. the of consequences State, of established this liens, firmly policy and it is now of and deeds 1885, require registration and been since has innocent purchasers against instruments and protect other Pell’s those who have not with law. of complied claims notes; 979-981 and eh. 147. Revisal, sec. Acts ob- It rule this case does not suggested applied that the con- title is held to legal pass tain in States where State, only this but in those veyance mortgagee, as where as a or lien, security considered merely for the of the debt. But an examination of the authori- payment ties will that no In the they recognize disclose such distinction. Illinois, Ohio, of New Jersey, Oonneeticut, Maryland, States has cases, from of which we have cited others, reports 20 Am. legal passes mortgagee. been held that the .to Enc. 5. (2 & The rule rests Eng. Ed.), p. note the reasonable that encumbrancer an assumption has courts, interest which should be and which can- protected by him be from or notice an impaired taken without has heard. “It been rule long be the received opportunity alter in the maxim audd am is to (expressed partem), no one condemned, deprived punished property he has an unless had judicial proceeding, opportunity being (8 Legal p. heard.” Broom Maxims Ed.), further Williams The defendant contends had as good if he foreclosed under the had sale, a title as the TERM, SPRING N. O.] v.
Jomes in accordance merely selling court tbe foreclosure suit was tbe substituting place with tbe a commissioner in power by v. Oettinger, of Dunn mortgagee, that therefore the case 148 N. where tbe trustee under tbe C., 276, applies. sold power, *11 our in this contention met recent decision But squarely v. N. in which McLarty Urquhart, C., 153 Justice Brown 339, invoke “Notwithstanding power, mortgagee may the the says: aid of the court the of foreclosing redemption of the Likewise in of resorting instead to case power. complica tions, mortgagor the has resorted to the courts for frequently and under protection compelled protection. foreclosure their Capehart C., v. v. Biggs, 261; Kornegay C., 77 N. 76 N. Spicer, Hellen, v. 96; 99; Whitehead 76 N. Kidder v. C., McIlhenny, Elliott, C., 81 N. 131; Manning C., v. 92 N. precedents point. This plaintiff to seek aid of the court to preferred foreclose instead of the contained the instru pursuing power ment. he pursued Had the latter he must follow its provisions but the court is to substantially, not bound follow them. Its to foreclose is power not derived from the sale in the power of mortgage. It could decree foreclosure the instrument con tained no such power.” The court acts its general equity jurisdiction proceeds grant and of relief the irrespective stipu lations contained in the of sale. It its power pursues own course and without practice restraint of by reason the of sale the power contained in so as deed, to administer the the according to law and its own equitable own procedure, acting under its and powers jurisdiction and not virtue of any contractual power given mortgage or deed of trust. But it must not be overlooked that defendant the "Williams did not the acquire legal title to the land by the assignment notes and mortgages him. The notes were transferred and the mortgage, but.without any conveyance suffi title legal cient transfer of the mortgagee. Williams v. C., C., 85 Dameron
Teachey, 402; N. v. Eskridge, 104 621; N. Hill, Co., C., 120 Eassey 312; v. N. Morton v. Lumber c., 152 C., C., 31 (s. 54); N. N. Modlin v. Co., Insurance 35. “In some of the States a mortgage is held statu regulation judicial construction to be tory simply lien, leav- IN SUPREME THE COURT. v.
Jokes Carolina In North mortgagor. estate in the ing legal and the law prevails, other States the common many subsequent per at defeasible by the legal once, deed passes title Hudson, C.,N. Lumber Co. v. formance of its conditions.” brief it is the defendant’s being so, conceded This did not note and mortgage it is so, assignment nor the Williams, power title the land in vest the legal 132 N. Wil C., 6; Norman v. Hallsey, as incident it. sale therefore, power, The Teachey, supra. legal liams not a was mortgagee, remained in Fred Martin, the court was not suit. It follows that party when it in the deed under the contained proceeding power having legal title and person ordered a sale of land. suit, time Williams to this and was himself' was made a party by and Williams assignment, took at the had been accepted before bid sale process service He and the confirmed. was a mere proposer the court *12 confirmation Joyner until it was took accepted place. Futrell, 136 and cases cited. The sale and deed of C., 301, N. more the effect of foreclosing the commissioner had no than in leaving legal outstanding of Fred redemption, circumstances, Under all these Williams Martin, mortgagee. bound orders decrees in adjudged must be to be suit, as be to a of far, least, may this so satisfaction necessary other claim his or plaintiff’s or Williams words, has, wise. In other whatever interest he subject to the lien and latter acquired plaintiff’s may if his him, redeem as debt has not been or already paid in to ascertain the satisfied, and order status the several taken, claims an account We will not even may necessary. what account should be suggest upon principle taken, that below, must be decided first the court 'besides, we cannot be. what evidence will But we anticipate say safely is not entitled to recover more that the than the plaintiff such original amount or debt, portion debt as remains unsatisfied. no between this case and those analogy
There where is sales made a contained a power or deed of N. TEEM, SPEING- O.] v. Wiixiams.
Jones for in the judgment, an execution issued a tinst, upon or under he a is proceeding former case when the acts under party out of and in the case an execution sale is court, proceed and the court is not mandate, under a ing statutory power is its and do what equitable jurisdiction called exercise interested. justice manifest as between all The plaintiff a at law enforcing right acquired by legal process is merely cases, In accordance with the and that is all. third statute, must be take of their interests. 13ut vigilant and care jurisdiction, when a court of or a court equity' having equitable is invoked to relief a ease It grant different quite presented.
strives to justice do and will not of his deprive prop erty without The distinction is too familiar and hearing. Hinton, manifest to further Menzel v. require elucidation. Cone v. C., 660; Hyatt, 132 N.
Our conclusion that the court erred its rulings. verdict will be set aside and a‘ new trial granted, the case proceed further the court below, in accordance with the law as herein declared.
New trial.
Olabk, C. J., dissenting. It has been always held for law in this State purchaser at a sale under a second mortgage acquires property subject to the lien of the first mortgage. But the purchaser at a sale under the first mortgage acquires property absolutely free from the liens of subse- quent mortgages. Purchasers at such sales are required there- fore to examine only prior encumbrances not as to subse- ones. quent Wilcox,
In Gambrill v.
156 —13 THE SUPREME COURT. IN
Jones v. in the contained under a of sale power the sale is made When mortga- subsequent to make is no opportunity there mortgage that notice be given it ever been required nor has gees parties, notice of the are fixed with mortgagees to them. The second take statute, they only mortgage by recorded redemption. foreclosure proceedings, pur- made under the sale When for encumbrances. subsequent to examine required chaser is not adjudges which judgment of the only takes with notice He He is thereunder. and decrees sale of the validity more encumbrances, subsequent not to examine for required or a judgment pur- under a docketed than a at sale purchaser with at a sale under a sale. chaser declared this explicitly and most It has been repeatedly Co., C., 117; Lumber Co. v. N. Court, Kornegay Steamboat Kerr, Co., C., 311; Williams v. N. C., 658; v. Hotel 109 N. Johnson, 126 that in a 66; proceeding v. N. C., Gammon mort junior the holders necessary if could not get made But the purchaser gages parties. are made subsequent mortgagees good title unless necessary parties beyond question. then would be parties, hold that it is advisable to make such Those decisions ex and even that the court add them mortgagees parties, mero is that have given thereby they may motu. The reason derived from participate surplus, any, opportunity over and above the the first payment the sale the mortgagor might cost of other proceedings, surplus looks to This reason the convenience and ad dissipate. wise but does not affect the mortgagees, of the second vantage purchaser. acquired that a many
It has been held cases docketed judgment, land, does not divest the a lien estate out of the though his title and does not even nor transfer make the debtor land Brandreth, Dysart the debt. liable for C., primarily (3 in Clark’s Code cases cited 592. If Ed.), p. there the title case, where estate in such still remain in fore at the debtor, purchaser execution sale judgment takes the divested property 'a lien of sub- senior *14 TERM, 1911. SPRING- O.] Jokes v. given without notice to judgments any being docketed
sequent of a when the land is sale, stronger the holders the for reason a foreclosure the must take with- purchaser sold under decree of recited out of encumbrances which are not any subsequent notice first the title and the the because the the sale mortgagee estate is to the to subject only transferred mortgagor. if return surplus, any, the subsequent mortgagees only mortgage upon The take The title and the estate are the redemption. legal first and the at the sale under first mort- mortgagee purchaser the no than gage can be more affected the subsequent liens first himself. the at such sale mortgagee purchaser Indeed the a better condition than takes mortgagee, legal the title was mortgagee discharged vested the of the trusts thereto attached. The is not to purchaser required to see application money. He his purchase discharged has duty when he has court at paid money into a sale under decree foreclosure, paid has at a sale sale, and has taken deed.
In foreclosure as the has proceedings, always held, Court Johnson, Gammon v. 126 N. cited, and other cases above it is advisable to make subsequent mortgagees parties they look their If not surplus. liens made parties in the summons, can ask ex they joined, or court mero motu can make them But their being not parties. parties cannot title impair the of the first mortgagee who virtue of his contract holds the nor legal estate, can it affect purchaser who acquires estate title mortgagee. first
For the above this reasons Court has always held that are mortgagees advisable foreclosure proceedings upon prior mortgage, but necessary parties. Hence, not made purchaser acquires, nevertheless, a good title.
It will a new burden place upon purchasers at such sales to impair their constructive notice of junior* encum- ordering brancers whom the court the sale has not fit seen make parties. at the foreclosure sale purchaser under the first mortgage COURT. THE SUPREME IN
Shelby Co. v. PoweR *15 decisions the uniform right rely upon this case had a to encum- subsequent make not necessary that it was this Court title is held notwithstanding, But if, parties. brancers motion aside the sale too, by setting defective, that, foreclose under in a collateral cause, proceeding but is in this proceeding junior mortgage, certainly recorded At mortgagee party. to make the senior necessary must be applied the first mortgage, proceeds under the after mortgage, the first recorded of the lien of payment of costs. payment is the first suggested, assignment by
If, as- was also at the foreclosure (who purchaser defective, assignee direct a repay- must be made a decree should sale) ment him of out of much of the money pro- so purchase made, now which are to be sale, applied ceeds of the lien mortgage. of the of the first discharge the first either The foreclosure sale under valid mortgage was If valid, got good invalid, or invalid. title. If purchaser under the second mortgage then the foreclosure sale lien must first be off paid out of the proceeds first registered mortgage sale. The first cannot be deprived its statute. priority given by H.
THE TOWN OF SHELBY W. JENNINGS v. CLEVELAND MILL AND POWER COMPANY. May, (Filed 1911.) Regu- Sewers—Pollution—Statutory 1. Water and Water Courses — lation —Constitutional Law. Revisal, regulating discharging “any sewers sec. into drain, public drinking-water supply from creek or river which a etc., taken,” police Legislature, is within the of the health, public for the is constitutional and enacted valid. Regu- Sewers—Pollution—Statutory 2. Water and Water Courses — Rights. Prescription—Vested lations — acquired right prescription can be so as to defeat No operation preservation public of a statute made for the