The appeal raises the question whether under the clause of defeasance the mortgagee's right to foreclose accrued upon the mortgagor's failure to pay the bond of $1,000 maturing on 1 December, 1925. The plaintiff, admitting that this is the only question presented by his exception, stresses the point that the mortgagee cannot sell before the date at which the last bond is to become due, while the defendants say that a sale of the mortgaged property is authorized by the terms of the defeasance upon default in the payment of the bonds, or the interest thereon, or upon default in the payment of any part of either at maturity. *Page 234
As a rule, a court of equity will not decree the foreclosure of a mortgage until the period limited for the payment of the secured debt is past and the estate is forfeited to the mortgagee, for it cannot shorten the time on which the parties have expressly agreed. Harshaw v. McKesson,66 N.C. 266. Hence, if several bonds maturing at different periods are secured by a mortgage and there is nothing in the contract, pleadings, or evidence that matures or hastens the maturity of the deferred payments, or any other event which constitutes a default, there is no right of foreclosure either for the whole debt or for any part of it until the last bond becomes due — the mortgagee's remedy meantime being a suit to recover judgment for such part of the debt as may have matured, a similar action from time to time as the other installments become due, and, if reasonably required for his protection, a suit for the present possession of the mortgaged premises. Walker v. Burrell, 172 N.C. 386.
This Court has also held that if the parties to the contract stipulate that the estate shall be forfeited or that the right to sell may be exercised upon the debtor's failure to pay the specified installments of the debts as they mature, then upon the debtor's failure to pay any installment that is due the mortgagee may demand his money or proceed immediately to foreclose. Harshaw v. McKesson, supra.
The cases cited in the brief of the plaintiff fall within the first of these two classes and do not support the position taken in his argument.Jones v. Boyd, 80 N.C. 258, and Brame v. Swain, 111 N.C. 540, were suits for the specific performance of contracts to convey land, and while in such cases the relation of vendor and vendee is analogous to that of mortgagee and mortgagor, it was decided that neither action could be maintained until the last installment of the debt became due; but these cases did not disclose any provision for accelerating the maturity of the notes or any other event constituting a default by the terms of the contract. In Hinton v. Jones, 136 N.C. 53, the defendant's deed of trust secured a single note of $6,000 "with interest from date, to be paid semiannually, the principal to be paid one-tenth annually until said note was paid in full," and contained the clause, "Should the said Jones well and truly pay said note as it falls due, then this deed shall be null and void; but should he fail to do so, then the said C. L. Hinton may sell." In accord with the authorities, it was held in reference to this provision that the trustee's sale must await the maturity of the entire debt, the Court emphasizing the absence of any provision that the entire note should become due and payable or that sale should be made upon default in any of its installments. Upon this theory the decision was referred to the principle stated in Harshaw v. McKesson, supra. Martin v. Kirkpatrick, 149 N.C. 400, simply adjudged that the provision of the Bankrupt Act maturing all debts owing by the bankrupt which were payable *Page 235 at the date of the adjudication did not interfere with the terms of the bankrupt's mortgage designating the conditions on which the power of sale could be exercised. It is obvious, then, that the defeasance in the mortgage executed by the plaintiff may be distinguished from the clauses which were passed upon in these cases, in that a sale by Coleman, the mortgagee, is authorized upon default in the payment of either bond. The parties did not stipulate in express terms that the entire debt should fall due upon default in the payment of one bond, as was stipulated in the mortgage referred to in Barbee v. Scoggins, 121 N.C. 135, and similar cases; but they provided for the application of the proceeds of sale to all the unpaid bonds and the practical effect is the same as if such a stipulation had been set out in the mortgage. After naming the bonds "hereinbefore described" — those representing the deferred indebtedness of $9,000 at the rate of $1,000 a year for nine years — the mortgagor stipulated that if default should be made in the payment ofsaid bonds, or the interest thereon, or any part of either at maturity, that is, any part of the bonds or any part of the interest at maturity, in that event it should be lawful for and the duty of the mortgagee to sell the mortgaged property and out of the proceeds to pay said bonds and the interest thereon. The language is plain. The mortgagee was empowered to make sale upon the mortgagor's default in the payment of either bond at maturity and to apply the proceeds in satisfaction of the unpaid notes. To say that the money derived from the sale should be applied in payment only of the bond then due upon its face and remaining unpaid would antagonize the express contract and would involve the retention by the mortgagee or some other disposition of the remaining proceeds not within the contemplation of the parties.
Our conclusion is in agreement with former decisions of this Court. InKitchin v. Grandy, 101 N.C. 86, it is said that where several notes due at different dates are secured by a mortgage or deed in trust wherein it is provided that upon default in the payment of any one of them the mortgagee or trustee may sell, and he does sell after the first note is due and before the maturity of the others, the proceeds must be applied ratably to all the notes remaining unpaid. To the same effect is Whitehead v. Morrill,108 N.C. 65. The mortgage foreclosed in Gore v. Davis, 124 N.C. 234, specified, "If default should be made in the payment of said bond or the interest on the same, or any part of either at maturity," the creditor could proceed to sell the land and out of the proceeds of sale should "pay said bond and interest." There was default in the payment of interest, and the Court said, "By the conditions of the mortgage the principal and interest became due." In Eubanks v. Becton, 158 N.C. 230, the sale made under the power conferred by the mortgagor was assailed on the ground that the mortgage, although containing *Page 236 a provision that the land might be sold upon failure to pay either note, did not provide that upon such failure the whole indebtedness should become due, and therefore that no sale could be made until the maturity of the last note. In the opinion it is said: "The mortgage contains the express stipulation that the land may be sold upon failure to pay either note, and requires the proceeds of sale to be applied to `the principal and interest which shall then be due on the said bonds.' The language is clear and the intention of the parties easily ascertained, and we must give effect to it. It is permissible to provide that the whole debt shall become due upon failure to pay any part, but not essential to the exercise of the power of sale. Gore v. Davis, 124 N.C. 234." The Court has maintained the doctrine in the later cases of Miller v. Marriner, 187 N.C. 449, and Leak v.Armfield, ibid., 625. The judgment is
Affirmed.