Bell v. King

The bill was filed by a mortgagor against the mortgagee and an assignee thereof; alleged that the mortgage debt was infected with usury; that the mortgagee was the real owner of the mortgage, the transfer merely simulated, and the transferee a mere "dummy," holding subject to all the equities between the mortgagor and the mortgagee; that the mortgagor had offered to pay and was ready and willing to pay the sum borrowed, with lawful interest; that the assignee was proceeding to foreclose the mortgage under the power therein; that the indebtedness secured was a part of an account long existing between the mortgagor and mortgagee, which was complicated, and on accounting the mortgagee, King, would be indebted to the mortgagor, Bell, in an amount exceeding the mortgage debt

The prayer was for a temporary injunction to prevent the foreclosure sale to be made permanent on final hearing; for purging the debt of usury; and for an accounting between the mortgagor and mortgagee, with decree over for balance claimed to be due complainant. There was prayer for general relief. The answers denied all the equities of the bill, and set up that the transferee, Brown, was the holder of the negotiable note evidencing the debt with the mortgage security in due course. There was no demurrer to the bill, and no cross-bill.

The present appeal is from decree rendered on pleadings and proof July 24, 1923.

The first question here is: Was this a final decree which will support an appeal by complainant, Bell?

The decree is divided into three subdivisions:

First, it expresses merely the opinion of the court that respondent Brown was the holder of the note and mortgage in due course.

Second, it decrees to complainant the right to redeem or have the title to certain property divested out of respondents, fixes the terms of such redemption, and decrees that upon compliance with these terms the title be divested by force of the decree.

Third, a reference to the register to find and report the amount to be paid, with directions to state the account in keeping with the terms fixed by the decree.

The legal title to the lands to be divested was still in respondent King, who had made an executory contract to convey the same to complainant, Bell, upon payment of the mortgage debt.

In Brown v. Bell, 206 Ala. 182, 89 So. 659, this cause was here on appeal from a decree overruling the motion to dissolve the temporary injunction. We then said:

"This bill was filed by appellee for the primary purpose of exercising the equity of redemption as to a certain mortgage" — the mortgage here involved.

The court below followed that decision in shaping the decree now before us.

The first portion of the decree, merely expressing the opinion of the court, decrees nothing within itself. It gives the views of the court upon which the decree following is based. The third portion, giving directions to the register as to the items to be charged, standing alone would be merely interlocutory, and subject to review only on appeal from final decree. Gainer v. Jones, 176 Ala. 408, 417, 58 So. 288.

The decree, construed as a whole, settles and determines the equities of the parties in the lands; decrees that complainant can have relief on payment of the mortgage debt in full, with interest thereon, the costs and expenses of foreclosure, including a reasonable attorney's fee incurred in this litigation, and the costs of suit.

The effect is certainly to decree the mortgage valid in the hands of Brown, not subject to deduction for usury, payment, or equitable set-off held by complainant against the mortgagee, King.

No order was made as to the injunction in force. The effect was to keep it in force for protection of complainant until he had the opportunity to redeem by payment of the amount to be ascertained. The decree is silent as to the accounting sought against respondent King. It does not expressly appear whether the court considered this feature of the bill a mere incident to its main purpose, with no independent equity, whether the proof failed to sustain it, or it was still to be considered.

The cause is retained only for orders on the report of the register. The decree expressly settles all equities between complainant and respondent Brown, and all rights of complainant in the lands described in the decree, which we have heretofore held to be the primary purpose of the bill.

We conclude this was a final decree which will support an appeal to this court.

Such decree has been so often considered and defined in our decisions, that a further discussion cannot make it more certain. We merely cite the following cases: Adams v. Sayre,76 Ala. 509; Burgin v. Sugg (Ala. Sup.) 97 So. 216;¹ De Graffenried v. Breitling, 192 Ala. 254, 68 So. 265; Wynn v. Tallapoosa County Bank, 168 Ala. 469, 53 So. 228; Gainer v. Jones, 176 Ala. 408, 58 So. 288; Alexander v. Bates.127 Ala. 328, 28 So. 415; Stein v. McGrath, 128 Ala. 175,30 So. 792; 3 Brick. Dig. p. 34, § 12; Ex parte Elyton Land Co., 104 Ala. 88, 15 So. 939.

Proceeding to consider the questions presented, the court below is fully supported by the record in his findings on the merits. No detailed or serious argument is presented on the facts questioning the court's findings thereon.

The point is made that in the absence of a cross-bill it was error for the court to order the reference shown in the decree. This reference is not ordered for the purposes of a personal decree against complainant, but simply to advise the judge the amount to be paid as a condition upon which relief was granted complainant — the amount required to do equity. There was no error in ordering such reference.

The point is further made that the decree should have divested title to all the property covered by the mortgage. Payment of the mortgage debt divests all title passing thereby. Code 1907, § 4899. As above noted, the title to the property mentioned in the decree would not pass by the payment of the debt because it was still in respondent King, and that part of the decree aims at doing complete equity.

It is urged that the court was in error in decreeing the payment of respondents' attorney's fee incurred in the litigation. The mortgage stipulated for the payment of a reasonable attorney's fee on foreclosure under power of sale or by suit in equity. Such stipulation for attorney's fees must be limited to those covered by the contract. Where no foreclosure is sought, attorney's fees are not allowed as a condition to redemption by the mortgagor.

The decree should have limited the attorney's fee to such reasonable amount as was incurred, if any, in the proceeding to foreclose under power of sale before the bill was filed. Anniston Banking Loan Co. v. Lapsley, 200 Ala. 377, 76 So. 293; Seed v. Brown, 180 Ala. 8, 60 So. 98; Pollard v. American Mtg. Co., 103 Ala. 289, 16 So. 801.

Affirmed in part, reversed in part, and remanded. Appellant will pay two-thirds the cost of appeal and appellees one-third such cost in this court and the court below.

ANDERSON, C. J., and SOMERVILLE and THOMAS, JJ., concur.

¹ Ante, p. 142.