In Re Wilson. Atlantic Life Ins. Co. v. Carr , 141 S.C. 60 ( 1927 )

August 22, 1927. The opinion of the Court was delivered by This is an appeal from an order of his Honor, Judge Shipp, dismissing the petition of Mrs. Wilson (who was the purchaser of the property sold under foreclosure proceedings) that the master pay from the proceeds of sale certain unmatured installments of a paving assessment levied by the City of Florence upon the property.

It appears that the Atlantic Life Insurance Company brought proceedings against Irvin P. Carr and Ruby M. Carr to foreclose a mortgage upon certain property in the City of Florence, which had been given to secure a certain note. The First National Bank of Florence was made a party defendant as the holder of a second mortgage upon the property given by the same mortgagors.

The case resulted in a decree of foreclosure sale, and at the sale Mrs. Wilson became the purchaser at $4,380. She complied with her bid, paid the purchase price to the master, and received a deed from him.

It then appeared that the property was subject to a lien for paving assessment; the amount of the total assessment was $731.77, $242,36 of which was due and unpaid at the time of the sale, leaving installments not then due amounting to $489.41. The purchaser contends that the unmatured installments, as well as that which is admittedly past due, should be paid out of the proceeds of the sale; else she will not receive what she bargained for, a title free from all incumbrances, and will be compelled to meet the future installments as they become due.

The main foreclosure case was referred to the master to hear and determine all issues of law and fact. His report does not appear in the record, but it is stated in Judge Shipp's order that the master recommended that the prayer of the complaint be granted; that prayer was that the proceeds of sale, after deducting the costs and expenses, a reasonable attorney's fee, and the taxes and assessments due and payable, be paid to the first mortgagee and the remainder distributed according to law. The decree of foreclosure confirmed the master's report and made it the judgment of the Court. The decree further specifically provided:

"That the proceeds of sale, after deducting the amounts of his fees and other costs incident to such proceeding, includingtaxes and assessments" and attorney's fees, "be applied by the said master to the mortgaged debt of the plaintiff herein, and that the surplus, if any, be paid to the defendants as their interests may appear."

It will be observed that while the prayer of the complaint refers to "taxes and assessments due and payable," and the master's report by reference recommends the same, which is confirmed by the first part of the decree, the concluding part of the decree provides for the payment of "taxes and assessments" without limitation as to their maturity.

While it is true that, under the case of Dial v. Gary,14 S.C. 573; 37 Am. Rep., 737, the decree may, by reference, convert "into a judgment the demand made by the plaintiff in his complaint," this declaration should be limited to matters not specifically referred to in the decree. If there should be a variance under these circumstances between the prayer for judgment and an express provision in the decree relating to the same matter, the decree should prevail.

There is no doubt but that the purchaser practically by her purchase made herself a party to the foreclosure suit (2 Black, Judg., § 549; Ellis v. Woods, 9 Rich. Eq., 19; Kaminsky v. Trantham, 45 S.C. 393;23 S.E., 132), and is assumed to have notice of all things disclosed by the record. But we do not think that the purchaser should be required, as to a matter specifically treated by the decree, to seek behind the decree for a possible inconsistency between the decree and some finding which has preceded it.

The decree requires the master to deduct from the proceeds of sale "taxes and assessments"; that is to say, all taxes and assessments. Certainly a purchaser who might find such a provision in the decree would be justified in bidding upon the assumption that all taxes and assessments would be taken care of; that he would acquire as clear a title from them as from the first and second mortgages then being foreclosed.

The Courts should be particularly jealous of the integrity of judicial sales. A purchaser should be allowed to secure such a title as in reason he intends to secure, unless there should be a palpable failure on his part to exercise ordinary care to protect himself.

In this case it is clear that Mrs. Wilson never dreamed but that she was securing a title free from all incumbrances, and that by the terms of the decree she was justified in assuming that the unmatured installments, which constituted a lien upon the property, would be taken care out of the proceeds of the sale, else it is most probable that her bid would have been that much less.

We see no difficulty in the adjustment of the unmatured installments. The act provides (32 Stat., 1414) for interest upon deferred installments, and it also reserves the right of the abutting owner to anticipate any and all annual installments.

The judgment of this Court is that the order appealed from be reversed and that the case be remanded to the Circuit Court, with direction that the prayer of the petitioner be granted.

MR. CHIEF JUSTICE WATTS and MESSRS. JUSTICES BLEASE, STABLER and CARTER concur.