Dollar Investment Co. of Maryland, Inc. v. Paton

Keating, Jr., J., by special assignment, delivered the opinion of the Court. These seven appeals in one record are from orders overruling exceptions to trustees’ sales of real estate and ratifying the sales. In 1960, Ettie Development Company (Ettie) executed seven security instruments, purporting to be deeds of trust to a savings and loan association to secure various sums of money and conveying seven different parcels of land. Through evident inadvertance or error in draftsmanship, the savings and loan association was named in each instrument trustee (party of the second part) as well as obligee or beneficiary of the trust.

Each instrument contained a full description of the debt, the state ⁹⁶ ment that it was security for same, and a full declaration of the terms of trust including a provision that upon default in the payment of the debt “said party of the second part or the trustee” was authorized to make sale of the real estate. The savings and loan association went into receivership under jurisdiction of the Circuit Court for Montgomery County and upon default by Ettie (or persons to whom Ettie had sold the land) the receiver, in an effort to collect the assets of his defunct corporation, applied to the court to appoint trustees for the purpose of foreclosing the defaulted deeds of trust. The appellees were so appointed and proceeded to make the sales in accordance with the requirements of the Maryland Rules. The appellant, Dollar Investment Company of Maryland, Inc., (Dollar), became the purchaser of the seven properties at the sale.

(Dollar also claimed in its brief, but not in its exceptions, that it was the owner of the several properties at the time of sale, by virtue of mesne unrecorded deeds from Ettie). The grounds for exceptions were that the trustees were without valid authority to sell. The appellant’s contention is as follows: The security instruments in question are invalid as deeds of trust because the trustee and party secured (obligee) are one and the same corporate entity, thus merging the beneficial interest with that of the trustee; but that said instruments are valid as mortgages and must be considered as such; and that because mortgage foreclosure sales are required by Rule W74 c 1 of the Maryland Rules to be made by a natural person who is either the mortgagee or some other person designated by name in the mortgage to exercise the power of sale and further because the