Harris v. Miller

BRICKELL, C. J.

On first examination of this cause, we were of opinion there was no error in the record of injury to the appellant. Further examination has led us to a different conclusion. A garnishment is not an equitable proceeding. It is essentially a legal proceeding, assimilated to an attachment of personal property; and, in its nature and operation, is the institution of a suit by a creditor against the debtor of his debtor. Only such demands, as the debtor by an action at law in his own name can enforce, the creditor may reach and condemn by this remedy; and whatever defenses would prevail if the debtor were himself suing, will avail against the garnishing creditor. Equitable demands can not be reached, and if a legal demand exists, complicated and involved with matters strictly and purely of equitable cognizance, which must be adjusted if full and complete justice is done, the parties will be remitted to a court of equity.—1 Brick. Dig. 175, §§ 313-14; Toomer v. Randolph, 60 Ala. 356.

The relation existing between the appellant, Harris, and the garnishee, Locke, was that of mortgagor and mortgagee. By the mortgage Harris became clothed with the fee-simple estate in the lands, which was subject to be defeated, if, on the law-day, the mortgagor paid the mortgage debt. After the law-day, and default in the performance of the condition, in the contemplation of a court of law, the estate was freed from the condition annexed to it. There remained in the mortgagor no more than the equity of redemption, of which, as between mortgagor and mortgagee, courts of law do not take notice.—Welsh v. Phillips, 54 Ala. 309.

The equity of redemption was subject to foreclosure; it could *33be cut off and barred by a .sale under the power contained in tlie mortgage. At such sale, the mortgagee could become a-purchaser, and by his purchase the mortgage debt would be satisfied and extinguished, to the extent and amount of the mortgagee’s bid, by mere operation of law; the law of itself applying the bid to the payment of the mortgage debt, and of such expenses incident to the sale, as were necessarily incurred, or, it may be, by the mortgage stipulated, should be paid from the proceeds of sale. Thereafter the mortgagee can maintain an action at law to recover only so much of the mortgage debt as the bid may not have satisfied.—2 Jones on Mort. § 953.

While the mortgagee may purchase at a sale made under a power in the mortgage, the mortgagor may, at his election, dis-affirm the sale, if the election is seasonably expressed. The mortgagor only, or those claiming under him, can disaffirm the sale. On ’the mortgagee it is binding, and his only right and remedy, if the mortgagor does not come in to 'disaffirm or avoid, is to resort to a court of equity to remove all doubt and uncertainty from the title by a confirmation of the sale, or by a resale under a decree of the court, if that shall appear to be equitable.—McLean v. Presley, 56 Ala. 211. It is, however, only in a court of equity that the sale may be disaffirmed. At law, in the absence of actual fraud, if the sale' has been regular, it is valid, and the mortgagee is regarded as clothed with the legal estate, upon which he can maintain ejectment against the mortgagor.—2 Jones on Mort. § 1816; Charles v. Du Bose, 29 Ala. 361; Hawkins v. Hudson, 45 Ala. 482. The court of law can not avoid the sale, because it'is incapable of adjusting the equities between the parties. When the election to disaffirm the sale is manifested, the mortgagee becomes chargeable as a trustee of the rents and profits while he may have been in possession, which are by a court of equity applied to pay the mortgage debt, and, if after applying them, there is a balance of the mortgage debt unpaid, a sale of the lands will be ordered to pay it. The relief essential to full and complete justice between the parties, and to put an end to all litigation between them, a court of equity alone can grant. Therefore it is, and because a court of law looks only to the legal estate in lands, that the sale in that court is operative and valid, and can be avoided only in a court of equity.

The sum bid by appellant for the lands at the mortgage sale, having to the amount of the bid satisfied and extinguished the mortgage debt, the balance of the debt, added to the value of the specific articles of personal property claimed and retained by the appellant, did not equal one thousand dollars, the amount of the exemption to which he was entitled. The sale -was not affirmed or disaffirmed by the offer of the mortgagee to redeem *34under the statute, if it were conceded that the statutory right of redemption extends to a sale at which the mortgagee becomes the purchaser. The offer was not of the kind or character on which a statutory redemption could be effected. Though it is said it embraced all lawful charges the appellant may have had on the land, it is manifest it did not embrace the payment of the entire mortgage debt, and that the object in making the offer was to remove so much of the debt as was unpaid after deducting the amount bid at the mortgage sale, as an incumbrance or charge on the lands. A mortgagor, coming to redeem under tlie statute, is bound by the terms of the statute to pay, not only the sum hid at the mortgage sale, with ten per cent .per annum thereon, hut all other lawful charges which the purchaser may have or can assert. The word charge, as- we have heretofore said, is of very large signification, and in the statute its proper signification is every lien, or incumbrance, or claim tlie purchaser may have on the premises, and for which at law or in equity he would be entitled to hold the lands as security, or to the satisfaction of which a court of equity would condemn them.—Grigg v. Banks, 59 Ala. 311; Lehman, Durr & Co. v. Collins, 69 Ala. 127. The charge may and will vary with different purchasers. Whether the mortgagee or a stranger may be the purchaser, if he removes a valid incumbrance on the lands, whatever was justly expended in the removal becomes a charge the mortgagor coming to redeem is bound to pay, and the offer to redeem will not be sufficient, if, when its amount is known, it is not embraced. It is a just and plain principle of the law of mortgages, that payment of tlie mortgage debt is a condition precedent to redemption. — Gliddon v. Andrews, 14 Ala. 733. This principle the statute of redemption was not intended to disturb or change. And if the statute extends to sales at which the mortgagee becomes the purchaser, the mortgagor can not redeem without paying the entire debt. The debt, so far as it is not extinguished by the bid at the mortgage sale, is a la/wful charge on the land. Eor if the redemption were effected, the title acquired would at once enure to the benefit of the mortgagee, and for the unpaid balance of the mortgage debt the mortgage would be a valid, operative security.—Stewart v. Anderson, 10 Ala. 504. The demand of the mortgagor to be let in to redeem without paying the mortgage debt, is opposed to the plainest dictates of right and justice, and is not sanctioned by any principle prevailing in courts of law or of equity. If the purchase by the mortgagee has been at a sum disproportionate to the value of the lands, or if the lands have increased in value, the mortgagor, by a mere, disaffirmance of the sale in a court of equity, can obtain a re-sale, protecting himself from all loss. Not only can he obtain a re-sale, but he *35can convert the mortgagee into a trustee of the rents and profits, having them applied to pay the mortgage debt. The mortgage, however, would remain a security for the whole debt, and exact justice would be meted out to both parties. A sale under a power in a mortgage, fairly made, operates as a strict foreclosure by a decree of a court of equity — it cuts off and bars the equity of redemption. This is true only, however, when a stranger becomes the purchaser. It is only partially true, when the mortgagee becomes the purchaser, and the restoration of the parties to the relation of mortgagor and mortgagee rests in the mere election of the mortgagor. The statute, and the statutory right of redemption, can not be perverted into an instrumentality, by which the mortgagor may deprive the mortgagee of the security for the debt which the mortgage affords. The offer to redeem made by the mortgagor did not vary his relation to the mortgagee. The mortgage debt, in,a court of law, and until the sale under the mortgage is disaffirm-ed, is paid to the amount bid by the appellant at the mortgage sale, and he is the owner of the lands.

The offer to redeem under the statute rests merely in parol, and can not in a court of law, if that court could inquire into* the affirmance or disaffirmance of the sale, be deemed as a ratification or confirmation. Estoppels or ratifications resting merely in parol can not in a court of law affect the title to lands.—Gimon v. Davis, 36 Ala. 589.

Upon the undisputed facts, the debt sought to be reached by the garnishment, must be regarded as having been paid to the extent of the bid of the appellant at the mortgage sale, and being extinguished to that extent, the remainder was exempt to the appellant. The rulings of the Circuit Court were not consistent with these views.

Reversed and remanded.