74 Ala. 133 | Ala. | 1883
— The main question in these cases, which grow out of the same transactions, and in which the same parties are interested, may be thus stated : First, whether the lien of a vendor of lands, for the payment of the purchase-money, is extinguished if he transfers the notes given for the purchase-money, the nature and character of the transfer excluding his liability for the ultimate payment of the notes? If, after such transfer, without the intervention of a new consideration, the assignor, to enable the assignee to enforce the lien on the lands, indorses the notes in terms which ■ impose upon him a liability for their ultimate payment, in the event the holder exercises due diligence to recover of the maker, and fails, can the assignee enforce the lien ? Can the legal effect of the indorsement be varied by parol evidence of an agreement, contemporaneously made, that the vendor should not be made personally or pecuniarily liable for the payment of the notes ?
.The subsequent indorsement of the notes by the vendor in writing is, in terms, a transfer of the legal title, and is a contract of specific legal, import — a contract by which the vendor binds himself to pay the notes, in the event the transferree, after .the exercise of the diligence the law prescribes, was unable to obtain payment from the makers. A transfer of this character, it can not be questioned, clothes the transferree
The indorsement, as we have said, is, of itself, a contract of specific legal import; and there is no principle upon which it can be varied or altered by evidence of contemporaneous verbal agreements or stipulations which the parties did not incorporate into it. It may be conceded the evidence shows that the purpose of the indorsement was merely to enable the transferrees to enforce the lien upon the lands, and that it was verbally agreed the vendor was not to be bound personally for the payment of the notes. It has long been settled by the decisions of this court, that the indorsement of a promissory note by the payee, whether in full or in blank, is a contract having a defined legal operation and effect, which can not be varied by parol evidence.' — 1 Brick. Digest, 301, § 699; Day v. Thompson, 65 Ala. 269.
The indorsement of the notes operating as an assignment, pro tanto, of the lien upon the lands, entitled the assignee to payment in priority of the note retained by the vendor, though it was in point of time first due and payable. This has been settled by repeated decisions of this court, and is the general doctrine applicable to mortgages and collateral securities for the payment of debts. The assignment of the debt, when absolute and unconditional, is an assignment pro tanto of the mortgage or other security; and if the fund arising from the mortgage or other security is not sufficient to pay the entire debt, the assignee has a preference over the assignor.— Cullum v. Erwin, 4 Ala. 252; Nelson v. Dunn, 15 Ala. 501; Grigsby v. Hair, 25 Ala. 327. The vendor, Daniel, after the indorsement of three of the notes, retaining one of them, was in the
A redemption is not claimed; nor is the fairness or regularity of the sale made under the decree of ,the court, in the suit by the appellants for the enforcement of the lien, assailed; nor is the price bid for the lands alleged to be inadequate. The only right which Daniel could assert was a right to the surplus of the proceeds of. the sale remaining after satisfying the decree in favor of the appellants'. A petition filed in that cause, while the fund was under the control of the court, was the proper mode of asserting the right. The right of Daniel to the surplus is, of course, superior to any claim Steiner, MeG-ehee & Co., as assignee of the Ellingtons, can claim. There is no event in which they would be entitled, unless there was a surplus of the proceeds of sale remaining after satisfying the whole purchase-money and the costs of suit.
We perceive no reason for setting aside the sale of the lands, or for withholding confirmation of it, and ordering a conveyance to be made to the purchaser.
The result is, the decrees of the chancellor must be reversed, and decrees here rendered in conformity to this opinion.