Ed Jacobsen, Jr., Inc. v. Chapline

Marbury, J., delivered the opinion of the Court. Property of the appellant, Ed Jacobsen, Jr., Inc. (Jacobsen), encumbered by a mortgage from Robert W. Russell, his wife Margaret T. Russell, and Jacobsen to the appellees Clara K. Chapline, Howard H. Kelly and his wife Mary C. Kelly, securing a note to them in the amount of $123,000.00 was purchased by the appellees at foreclosure sale for $60,000.00 after default had occurred under the terms of the mortgage. The appellees had previously sold the property to the appellant and the Russells in 1964 for $150,000.00. On February 19, 1968, the Circuit Court for Frederick County ordered the final ratification of the sale and on March 15 following, the final ratification of the auditor’s report was filed.

No appeal was taken from either of these orders. On the same day the court issued an order to show cause ⁷² why a deficiency decree in the amount of $57,961.03 should not be entered against the mortgagors. Subsequently the appellant filed its opposition to the order to show cause on April 15, 1968, alleging a breach of trust by the appellees. After a hearing, the lower court entered a deficiency decree against the appellant and the Russells in favor of the appellees.

Only Jacobsen filed a timely notice of appeal. The appellees filed a petition for supplementary proceedings on May 27, 1968. While the appellant’s appeal on the deficiency decree was pending, hearing was held on the petition for supplementary proceedings, and on June 13, 1968, the court passed an order subjecting property held by the Montgomery Development Corporation (Montgomery) to the lien of the deficiency judgment. Appellant also appealed from this order.

Jacobsen presents three issue on appeal: 1. Whether, without shocking the conscience of the court, the appellees could demand a deficiency judgment of $57,961.03 against appellant because as mortgagees they had purchased at a foreclosure sale real property for $60,000.00, several years earlier sold by them to appellant for $150,000.00? 2. Whether after appellant had noted an appeal to this Court from the order of the Circuit Court allowing such deficiency judgment the Circuit Court could consider appellees’ petition for supplemental proceedings ? 3. May the court pass an order subjecting property to the lien of a deficiency decree which is in the hands of a person other than the judgment debtor without giving that person the right to be heard by the court ?

Pursuant to the provisions of Maryland Rule 835 b (5) the appellees moved to dismiss the appeal from the deficiency decree. Rule 828 b 1 (a) requires that the printed extract shall include the judgment appealed from. Appellant’s extract does not include the deficiency decree. Further, the appellant’s whole argument as to the impropriety of the deficiency decree is based upon the difference between the purchase price which Jacobsen had agreed to pay for the mortgaged property, and the price ⁷³ which that property had brought at the foreclosure sale.

Appellant’s extract does not include substantiation from the record for either of these sums. However, at oral argument appellees’ counsel stated that he did not “seriously press” his motion and since the appellant’s contentions are devoid of any substance, we prefer to rest our decision on the merits. The appellant did not appeal from the final order dated February 19, 1968, which ratified the foreclosure sale. As this Court stated in McKenna v. Sachse, Executor, 225 Md. 595, 599 , 171 A. 2d 732 , 734: “In the absence of fraud or breach of actual trust, ‘it is also well