Schneider v. Scarborough

Grason, J., delivered the opinion of the Court. This case presents to this court for review the correctness of an order overruling exceptions to the ratification ³⁰⁵ of an auditor’s report. The facts of the case are as follows: Henry L. Schneider (appellant) assigned to J. Gifford Scarborough, an attorney at law (appellee) a mortgage which he held on certain property situate in Cecil County, for the purpose of foreclosure. Schneider owned the property and deeded the same to J. Francis Truitt, Inc., a Maryland corporation, and at the same time, and as a part of the transaction, the corporation executed to Schneider a purchase money mortgage in the amount of $45,000.00.

The mortgage is dated October 20, 1947, covers two parcels of land of about three acres, improved by tourist cabins, and includes the personal property on the premises. Default having occurred under the terms of the mortgage, appellant assigned the mortgage to appellee by long assignment for purpose of foreclosure. This assignment is dated the 2nd day of May, 1950. It refers to the mortgage to appellant from J. Francis Truitt, Inc., the amount thereof, the rate of interest, and the mortgage records of Cecil County where the mortgage is recorded.

It also contains the following clause: “WHEREAS, it is the intention of the said Henry L. Schneider to assign said mortgage for purposes of collection and/or foreclosure to J. Gifford Scarborough, Attorney-at-Law.” It further provides: “* * * the said Henry L. Schneider does assign to the said J. Gifford Scarborough the within mortgage for the purpose of collection and/or foreclosure, which mortgage covers the following described property, * * *” It then describes, by metes and bounds, parcel No. 1 and parcel No. 2 of the land covered by the mortgage. Appellee instituted foreclosure proceedings and advertised in two newspapers published at Elkton that he would “sell at public sale at the Court House Door, in the Town of Elkton, * * * on Monday, June 5th, 1950, at 11:00 A.M., all right, title and interest of the said Mortgagor, to the following described parcels of land”, (and then set out by metes and bounds, courses and distances, parcels No. 1 and No. 2 contained in said mort ³⁰⁶ gage); The advertisements further containéd: “Being the same two parcels of land which were conveyed unto J. Francis 'Truitt, Inc. by Henry L. Schneider by deed dated October 20, 1947,- and recorded among the said Land Records in Liber R. R. C. No. 27, Folio '426. Together with the improvements thereon erected and all the .rights, privileges, and appurtenances thereunto belonging or in anywise appertaining, including the personal property and equipment located on the premises.” (Italics supplied.) The property was sold, as per advertisements, to Henry L. Schneider for $38,000.00. The appellee reported the sale on June 15, 1950.

In the Report of Sale the. appellee states that he sold, as per advertisements’: “the said real estate mentioned in said Mortgage”, and specifically mentions the two parcels of land contained in the mortgage, “to the said Henry L. Schneider, through his agent, Lewis A. Seth, he being then and there the highest bidder therefor at and for the sum of Thirty-eight Thousand ($38,000.00) Dollars”. This sale' was duly reported by the assignee and finally ratified and confirmed on the 21st day of August, 1950, and has long since become enrolled. Solicitor for appellant, in his argument before this court, stated that his client was perfectly satisfied with the sale; and the mortgagor, Truitt, Inc., agreed not to bring any action to set aside the sale. Nevertheless, appellant contends that the personal property did not pass under this sale.

With this contention we do not agree. The assignment to appellee covered the whole mortgage, and thus included the personal property. There can be no doubt that the appellant intended, by his assignment to the appellee, to convey all property covered by the mortgage, real and personal. We take it that the advertisement was read before the property was auctioned at the sale, and the appellant must have heard it read.

He knew then, by the terms of the advertisement, that both the' real and personal property were, being sold at the auction. The testimony shows that appellant had discussed the matter thoroughly with ³⁰⁷ the appellee and with his real estate agent, Mr. Seth. He was foreclosing a mortgage through his assignee, and he purchased the mortgaged property through his real estate agent at the sale. There being no exceptions to the sale, no one is involved here but the appellant, who was, for all practical purposes, the seller and purchaser.

He knew exactly what the property consisted of, both real and personal. All of the property covered by the mortgage, therefore, passed to him as purchaser. Furthermore, the appellee testified that he sold both the real and personal property to the appellant. On December 2, 1950, the appellant filed exceptions to the auditor’s report, in which he alleges: 1.

That he employed appellee to foreclose the said mortgage and agreed to pay him therefor a reasonable fee. 2. That appellee did not distribute to him the money shown in the auditor’s report, to wit, the net proceeds of