Tubberville v. Simpson , 94 Miss. 154 ( 1908 )

Fletcher, J.,

delivered the opinion of the court.

On November 16, 1905, one J. F. Milam, being indebted to Shelley Guy in the sum of $1,675, executed three promissory notes, payable at intervals, aggregating the amount of the indebtedness, each of which notes provided that, “if this note is placed in the hands of an attorney for collection, the makers and indorsers hereof agree to pay the holder thereof an attorney’s fee of ten per cent upon the amount due.” To secure these notes Milam executed a deed of trust on ten mules, a log .wagon, and certain implements used in hauling logs. This trust deed does not recite in so many words that the notes provide for the payment of attorney’s fees, but it does contain the usual provision as to expenses of executing the trust and the cost -of seizing and caring for the property and preparing it for sale. Default was made in the payment of the notes, and they were placed in the hands of an attorney for collection. About the time or a little after the second note became due Milam sold to Tubberville four of the mules, the wagon and certain of the appliances, all embraced in the deed of trust. The trust deed having been promptly recorded, Tubberville had constructive no; tice of its existence, and seems also to have had actual notice that the property was incumbered. We cannot tell from this record whether Tubberville actually knew of the provision in the notes as to attorney’s fees, but he did know that the notes were in the attorney’s hands for collection. Milam paid $250 on the debt, and Tubberville $600; the latter sum being paid to the attorney, who deducted ten per cent, for collection and credited the notes with the balance. Subsequently Simpson, the trustee, took charge of and sold at public sale the mules covered by the trust deed, but not sold to Tubberville, and derived’ the sum of $925 from this sale. From this sum there were deducted trustee’s expenses and commissions, the sum of $100, which Guy had been forced to pay to discharge a superior lien (this right being conferred by the trust deed), and ten per cent, attorney’s-fees, amounting to $92. These payments not being sufficient to discharge the indebtedness, the trastee attempted to take charge of the property held by Tubberville, and, -meeting with resistence, instituted this action of replevin to secure possession of the property. On this trial the court charged the jury to find for the plaintiff in such sum as might be found due, allowing plaintiff the attorney’s fees that had been retained. The only real controversy is over this question of attorney’s fees; the question of trustee’s charges, expenses, and commissions having been settled by the jury on proper instructions.

It is urged that Tubberville, the purchaser, should not be charged with the payment o-f attorney’s fees, because the trust deed did not contain any reference to such fees, and the record did not, therefore, impart notice of this phase of the contract. It might be a sufficient answer to this contention to say that Tubberville has not affirmatively shown that he was a bonai fide purchaser without notice. He testified in the ease, admitted that he knew the property was under mortgage, and disclosed nothing as to the source of his information. It might well, have been true that he derived his information from Milam, who gave-full particulars of the contract. But, aside from this, we think it the safer view that the trust deed, containing a.reference to the notes, puts a purchaser upon inquiry as to the contents of the notes, especially in regard to so usual a provision as the payment of attorney’s fees. We think the case falls within the principles, though not within the facts, of Witczinski et al. v. Everman, 51 Miss. 841.

The other contention deals with the propriety of allowing both trustee’s charges and attorney’s fees. In regard to the $000 collected by the attorney before the sale of any of the property, this sum was not diminished by trustee’s expenses or commissions, and, having been collected through the efforts of the attorney, the allowance of the fee was obviously correct. Coming, now, to the other amount -awarded by the jury in this suit, it is clear that the attorney’s fees should have been allowed thereon, since the sum was collected only after a stubborn litigation, in which the services of an attorney were indispensable. Jlut in the case of the money derived from the sale of certain property by the trustee, in which the sum of $925 was realized, a different question is presented. There was no litigation in regard to this sale, and the sum collected was due entirely to the efforts of the trustee, as to which the attorney had nothing to do, except to give general directions to the trustee to seize and sell the property. Manifestly the attorney and the trustee each had his own peculiar functions to perform. Each occupied a separate and somewhat distinct field of operations. Each should be compensated for such Services. as he renders within his own peculiar sphere, but justice will not permit the attorney to retain fees from money collected by .the trustee as the fruits of a sale made by the trustee and which has already been charged with the payments of all reasonable trustee’s charges. Stipulations for the payment of attorney’s fees must he construed strictly in favor of the debtor; and, so,construing this contract, we cannot approve the allowance of this item. This conclusion is clearly foreshadowed in the case of Elkin v. Rives, 82 Miss. 744, 35 South. 200, approving the Alabama case of Thompkins v. Drennan, 10 South. 638, in which the distinct functions of attorney and trustee are clearly defined.

The verdict of the jury under the instructions of the court, manifestly allowed the $92 item claimed by the attorney, and to this extent the judgment is erroneous. If appellee will remit that amount here, the judgment will be affirmed; otherwise, it is reversed and the cause remanded.

Error.