Contracts of the character here involved and the remedy of specific performance for their enforcement are specifically authorized by legislative enactment (§§ 7142, 7143, Code of 1923), and they have met with the test of review in this court (Warren v. Ala. Farm Bureau Cotton Ass'n, 213 Ala. 61,104 So. 267), wherein is the following language:
"But the statute in this case gives the remedy by injunction to prevent threatened breaches of the contract by association members in the disposition of their cotton, and by their contract they have expressly assented thereto. We can see no practical difficulty in the specific enforcement of this single feature of the contract for a single season; and the objections based upon the want of mutuality or remedy and the adequacy of the remedy at law are eliminated by the terms of the statute and the contract made thereunder."
Like contracts under legislative approval have frequently been before courts and upheld. Tobacco Ass'n v. Patterson,187 N.C. 252, 121 S.E. 631; Tobacco Ass'n v. Harvey Son,189 N.C. 494, 127 S.E. 545; N.C. Cotton Growers' Ass'n v. Bullock,191 N.C. 464, 132 S.E. 154.
The authorities, of course, recognize that the rights of a bona fide mortgagee must be protected. The case of Tobacco Ass'n v. Patterson, supra, is analogous to the instant case. There the mortgagee was not made a party, and it was held that the decree rendered should be without prejudice to his rights, but that a decree of specific performance against the defendant was proper. The opinion uses the following language:
"But as to this defendant, and on the facts as presented in this record, he having practically admitted that he has broken his contract with plaintiff and intends to continue to do so, it is not for him to decide by his own ipse dixit what is or is not a valid lien, or the extent of it, and, in our opinion, he should be restrained to the hearing from voluntarily and personally making any further disposition of his crop other than as required by his contract with plaintiffs, either of the crop of 1923, or any other crop coming into his possession and control and ownership during the life of the contract, and subject to its provisions."
Conceding, for the purposes here in hand, the bona fides of the mortgage transaction here involved, in my opinion the decree of the court below should be affirmed, but modified so as to specifically state that it is without prejudice to the rights of the mortgagee. Such was the course pursued by the North Carolina court in the Patterson Case, supra, and I think correctly so.
The contract discloses that it was in contemplation of the parties that defendant might desire to mortgage his crops and provides that the complainant association shall have the right to "take delivery of his cotton and pay off all or part of the crop mortgage for the account of the grower, and charge the same against him individually." In this case, it appears from the testimony of these mortgagees that they were unwilling to make a transfer of the mortgage to complainant upon the payment of the indebtedness without the consent of the defendant. When the relationship of the defendant to the mortgagees is considered in connection with this admission on their part, and the further fact that the mortgage was executed subsequent to the time it became defendant's duty to deliver his cotton to complainant, and that the mortgage embraced considerable other property, including valuable real estate, while the amount of cotton on defendant's premises was only about 12 bales, and that defendant had become dissatisfied as a member and unwilling to pool his cotton for that year, and refusing to give to agents of complainant the name of the mortgagees, the bona fides of the transaction may be seriously questioned, and, indeed, it may be reasonably inferred from all the circumstances in evidence that it was resorted to as a means of evasion of the contract on defendant's part.
In any aspect of the case, I am of the opinion the decree should be affirmed, and therefore respectfully dissent. *Page 392