Phillips v. Birmingham Industrial Co.

54 So. 603 | Ala. | 1911

DOWDELL, C. J.

The averments of the bill show that the appellant Phillips executed a mortgage to the Birmingham Industrial Company, appellee, embracing the real and personal property described in the bill, and that there was a foreclosure of the mortgage under the power contained in it, and at the foreclosure sale the appellee became the purchaser. The appellee then, made demand for possession on Phillips, the mortgagor, and H. C. and Emma Cristlieb, the mortgagor’s tenants, who were in the actual possession of the property under a lease from Phillips executed subsequent to the execution of the mortgage, and met a refusal to surrender possession on said demand. Thereupon appellee brought suit in ejectment against respondents in this bill for the real éstate, and subsequent to the filing of this bill instituted detinue. The bill avers the nonresidence of the respondent Phillips, and the insolvency of all of the respondents. The prayer of the hill is for a receiver, and its chief and only purpose is for the appointment of a receiver to take possession of the property and intercept the rents pending the actions at law. The bill in its character and essence is simply ancillary to the suits at law. The answer to the bill, as amended, and which is asked to be made a, cross-bill, admits the averments of.the bill, except as to the nonresidence of Phillips and the insolvency of the respondents, and as to charge of collusion on the part of the respondents, and those charges are denied. The application for a receiver, upon timely notice, was heard by the chancellor on bill, answer, and affidavit, and a receiver was appointed. That the chancellor was justified on the proof in determining the disputed questions of nonresidence and insolvency against the respondents and in favor of complaint we think there can be no doubt.

No appeal was prosecuted from the order of appointment of receiver, and the receiver took possession of the property and collected the rents. The suits at law, both in ejectment and detinue, proceeded to final judgment in favor of the plaintiff, the appellee-here and complainant in this bill. Appropriate writs were issued on the judgments at law, and on the petition of the complainant the chancery court allowed them to be served upon the receiver, and under these writs the possession of the real and personal property was delivered the complainant. Tlie receiver made a report of his receivership and filed his accounts under appropriate orders of the court. The purpose of the receivership having been fulfilled, the cause was then submitted for final hearing on the pleadings and proof, and a decree rendered discharging the receiver, and dismissing the respondents’ cross-bill; no steps having been taken by the respondents to bring their cross-bill to a hearing on answer or by decree pro confesso for failure to answer. In Bank of Florence v. Savings & Loan Co., 104 Ala. on page 299, 16 South. on page 110, it was said: “When an application is made for the appointment of a receiver, the primary inquiry is whether there is shown a reasonable probability that the plaintiff asking the appointment will ultimately succeed in obtaining the general relief sought by the suit.” The relief sought here is in aid of the action at law. Can there be any doubt, on the facts as shown in this case, of the reasonable probability of the plaintiff’s ultimately succeeding in the action at law? It is insisted by counsel that the complainant was a second mortgagee, and therefore only held an equitable title, which would not support an action of ejectment. As a general rule this proposition is sound; but the facts in the case before us make it an exception to the general rule. The action of ejectment here is by the mortgagee after foreclosure and purchase under the foreclosure sale against the mortgag- or and his tenants holding under lease subsequent to the execution of the mortgage. In such cases the mortgagee, as against the mortgagor and his privies in estate subsequent to the making of the mortgage, becomes vested with the title both legal and equitable. This doctrine is well established in the case of Cotton v. Carlisle, 85 Ala. 175, 4 South. 670, 7 Am. St. Rep. 29, citing the case of Marks v. Robinson, 28 Ala. 69, 2 South. 292, where the question is considered at length and authorities collated. On these cases there can be no doubt of the right of the complainant to maintain his action at law in ejectment.

As to the appointment of a receiver in the case on the bill and the facts as presented, the case of Mortgage Company v. Turner, 95 Ala. 272, 11 South, 211 strikingly analogous to the one at bar, we think, is conclusive of the correctness of the chancellor’s ruling. As against the mortgagor and his tenants holding under him, the complainant here, plaintiff in action of ejectment at law, was the owner of the real estate, with immediate right of possession, and entitled to the rents and to have the same secured to him against waste or loss. The cases cited and relied on by appellants were those where the bill was for a foreclosure of the mortgage in equity, and are differentiated both on facts and principle from the case here. In those cases the mortgage was regarded as a security for the mortgage debt, and the value of the mortgage property was in question; whereas here the mortgagee has become the absolute owner of the property mortgaged, and the question of its value is immaterial in the matter of the appointment of a receiver.

We are unable to see that any error was committed in the appointment of a receiver, or in the final disposition of the case, and the decree appealed from will be affirmed.

Affirmed.

Anderson, Sayre, and Evans, JJ., concur.