Heuisler v. Nickum

Bowie, J., delivered the opinion of the Court. McKeel T. Wize, of the City of Baltimore, on the 18th of September, 1869, executed a mortgage to the Arnicahie Building Association, Ho. 2,” of that City, to secure certain advances made to him by the Association, and his compliance with certain conditions in said mortgage mentioned. The mortgage contained a clause consenting that a decree might be passed for the sale of the property, (the sale to take place after a default in any of its conditions,) under the provisions of sections 782 to 792 inclusive, of Art. 4, of the Code of Public Local Laws, etc. On the petition of the Amicable Building Association, filed in the Circuit Court of Baltimore City, alleging the mortgagor was largely in arrears to the Association, and that default had been made in the performance of its conditions, according to the terms of the mortgage, a decree was passed on the 27th of May, 1872, authorizing a sale, and appointing Joseph 8. Heuisler, trustee, to execute the decree, with the usual provisions as to qualification, and prescribing the terms of sale, etc. The trustee afterwards on the 3rd of July, 1872, reported to the Court, that he had sold the premises to the appellee, William C. Hiekum, he being the highest bidder.

An order of ratification nisi was passed by the Court on the same day; and before the time prescribed in the order, for final ratification, viz: on the 3rd of August, 1872, the appellee filed his petition praying that the sale might be set aside and annulled, for the following reasons, viz: Because since the sale, he has ascertained that the property sold is subject to two judgments, prior in date to the mortgage, which ai’e liens on the property, and the judg ²⁷⁴ ment creditors were not made parties to the proceedings, and the property was not sold subject to said liens, and no provision is made for their payment. He alleges that the net proceeds of sale are insufficient to pay said judgments, with their costs, and accrued interest, and the trustee is unable to convey to petitioner a clear title to the property. Short copies of judgments are filed by consent of counsel, marked Exhibit W. O. N., No. 2, and No. 3, respectively — showing a judgment in the Court of Common Pleas, on the 11th of November, 1862, in favor of John P. Poe, receiver, etc., against McKeel T. Wize for $425, with interest from 6th of September, 1861, and costs. 26 February, 1870, attachment on judgment to May term,. 1870 ; anda judgment of the Bank of Commerce vs. John T. Wize and McKeel T. Wize, on the 20th of September, 1862, for $255. Interest from 10th September, 1862, and costs — f. fa. issued to January term, 1863, returned “ nulla bona.” The trustee answering the appellee’s petition, admits he has received the cash payment, and notes of the petitioner for the residue of the purchase money, professes to be ignorant of the two judgments alleged to be of record, but denies they constitute any incumbrance prior to the mortgage debt.

The trustee insists that if such judgments are of record, they cannot affect the interest of the petitioner; he denies the necessity of making judgment creditors parties to the proceeding, and avers that any interest they may have in the purchase money, does not prejudice the petitioner, even though the net proceeds of sale would not pay the judgments, if so applied. He avers, that he sold only the interest of the parties to the cause, and the purchaser bought the same, and there is nothing in his petition, which is a sufficient ground for exception to the ratification of the sale. ²⁷⁵ • The Court below, after argument on the exceptions of the appellee, sustained the objections to the sale, and ordered that the same be set aside, and the trustee return to the purchaser, the cash payment, and notes for the deferred payments; from which decree, the Amicable Building Association, No. 2, and the trustee appealed. The appellants’ counsel in their brief, say, “that McKeel T. Wize purchased the property in question from Mary C. Dempster, and simultaneously mortgaged tlie same to the Amicable Building Association, to secure a, sum of money advanced to him, to enable him to purchase the property.” They contend that the case comes within sec. 3, of Art. 64, Pub. Gen.

Laws, which provides, “Whenever lands are sold and conveyed, and a mortgage is given by the purchaser al the same time to secure the payment of the purchase money, such mortgage shall be preferred to any previous judgment, which may have been obtained against such purchaser.” Whatever interpretation might be given to this section of the Code, if the record contained facts, requiring its application, it would be very premature in this Court, to decide its meaning upon a mere hypothesis. Notwithstanding the appellee seems to admit the correctness of the appellants’ statement, the record shows that the mortgaged premises were purchased by the mortgagor of Mrs. Dempster, on the 15th of September, 1869, and granted and conveyed by deed on the same day to McKeel T. Wize in fee simple. Tlie mortgage, made part of the record, bears date the 18í7¿ of September, 1869, and recites, “whereas the said mortgagor, being a member of said body corporate, has received therefrom an advance of six hundred and seven dollars and fifty cents on his five shares of stock,” etc., “and whereas, it was a condition precedent to said advance being made to him, that he should secure the payment of the sums of money,” etc., wherefore these presents are ²⁷⁶ executed. There is no reference whatever to the purchase by the mortgagor of Dempster, or the application of the money advanced by the Building Association to the payment of the purchase money.

In our opinion this is not a case of instantaneous seizin. It was decided, in the case of Wollen vs. Dillen, 9 Gill, 185 , “that the release of a senior mortgage, let in a junior incumbrance on the same property, although it was proved no money was paid, but another mortgage was executed simultaneously with the release, as the consideration therefor?” The principle of this case was recognized and reaffirmed in the case of Alderson vs. Ames &