James v. Markham, 125 N.C. 145 (1899)

Nov. 7, 1899 · Supreme Court of North Carolina

125 N.C. 145

R. V. JAMES, Guardian, G. W. WATTS, W. H. ROWLAND and Wife, W. R. COOPER and Wife, v. F. D. MARKHAM, Sheriff, J. S. CARR, FIRST NATIONAL BANK, and MOREHEAD BANKING COMPANY.

(Decided November 7, 1899.)

Judgment — Mortgages—Execution—Injunction—Buie of Inverse Order of Alienation — Supersedeas Bond on Appeal.

1. Where the lands of the debtors are all under mortgages, in different parcels, at different times, a court of equity will not interpose to require a judgment creditor to levy upon and sell the land in the order in which it was conveyed, where there is no allegation that the judgment or mortgage creditors were insolvent, and that irreparable loss would come to the plaintiffs if the restraining order was not continued.

2. A supersedeas bond, being the act of a party, is not allowable for the purpose of continuing the effect of the restraining order-after it has been dissolved by the Court — neither will an appeal prolong an injunction which the Court has decreed! no longer exists.

ApplicatioN to continue to the final hearing a restraining order made in this cause, pending in the Superior Court of Duhi-iam County, to Bryan, J.

Two of the plaintiffs, Rowland and Cooper, are debtors.of the other plaintiffs, also of the defendants (except Markham, Sheriff), all secured by various mortgages on different tracts, at different times. The defendant Carr, in addition to his mortgage debt, is also the assignee of a judgment against them, of prior lien to any of the mortgages; and execution has been issued, and is in the hands of Markham, Sheriff, for service.

The object of this action is to require Carr and the sheriff to levy upon and sell the land of the debtors in the order in which it was conveyed in the several mortgages.

The complaint filed and used as an affidavit, is as follows:

1. That Mrs. R. V. James is the guardian of certain infant children and as such several years ago loaned to W. R. Cooper the sum of $1,315.00, taking his note therefor, and that there is due her by said Cooper the said sum of $1,315.00, with interest upon the same from the 26th day of August, 1897.

2. That several years ago, the plaintiff Geo; W. Watts loaned to Rowland & Cooper the sum of $2,000.00, and that there is due him thereon the sum of $1,600.00, with interest from.day of., 1897.

3. That at the March Term, 1897, of Durham Superior Court one W. O. Blacknall obtained a judgment against said Rowland & Cooper for $1,250.00, interest and cost, which was duly docketed in Durham County.

4. That Rowland & Cooper at said time constituted a firm, and were engaged in a general leaf tobacco business. That said firm found itself embarrassed much above its ability to pay, and, therefore, the mortgages and other encumbrances hereinafter referred to, were executed by the said firm and the individuals composing tbe same.

5. That on the 26th day of August, 1897, W. R. Cooper and wife executed to Geo. W. Watts a deed of trust to a one-half individual interest in and to the prize house and lot of Rowland & Cooper, on the west side of McMannen street, in Durham, N. 0., (for an accurate description of which reference is made to book 26, page 406, of mortgages of Durham County), in order to secure the above-recited loan of $1,600.00, and that on the same day the said W. R. Cooper and wife executed to Mrs. R. V. James, guardian, a mortgage on about fifty (50) acres of land in Patterson Township, Durham County, where Ed. Cooper now resides, (for an accurate description of which see book of mortgages No. 26, page 409), in order to secure the above-recited indebtedness of $1,315.00.

6. That thereafter, to-wit, on the 4th day of September, 1897, said Rowland & Cooper and their respective wives being indebted to J. S. Carr in the sum of $835.50 and also to the Morehead Bank and the Eirst National Bank in large sums, executed to E. C. Murray, Trustee, a deed of trust upon 2 lots of land in North Durham, Nos. 24 and 25, of the Link’s survey, and also upon a brick store of said Cooper on the north side of Main street, all of said property being accurately described in book of mortgages 26, page 433, a copy of said deed of trust being hereto attached, and marked Exhibit “A”.

7. That in addition to said instruments and in order to further secure their said creditors and particularly to pay off the said Blacknall judgment, the firm of Rowland & Cooper, during the fall of 1897, executed and delivered a transfer of all its interest in certain property, lying near Murphy, N. C., and which previously belonged to the Murphy Improvement Company, the said interest being worth about $500.00, and they likewise executed for the same purpose an instrument conveying a judgment for about $1,000.00 which Revis & Baxton, attorneys, state is valid and collectable on certain lots in Johnson City, Term., which cost said'firm about $30,000.00, both of which last-named papers were delivered to the Morehead Bank at Durham, N. O., or its agents. That such papers named certain persons therein which were competent to act and directed them to sell the property therein described, and to retain the proceeds to be used in paying off the Blacknall judgment and thereafter certain other creditors named therein. The plaintiff demands a production of said papers at the trial of this action, and prays that ’the same may be made a part of this complaint.

8. That since the Blacknall judgment was obtained, to-wit, within the past 30 days, the same has been purchased by and assigned to J. S. Carr, and the plaintiffs here offered to pay off said judgment, principal, interest and cost, and also the Morehead mortgage on the Cooper store for $3,000.00, provided that the'said Carr and Morehead Bank would assign the same to the plaintiff Watts, with which request they have refused to comply.

9. That the said Murray has been requested to sell under the deed of trust of the 4th of September, and he has refused so to do.

10. That the property conveyed to the said Murray is well worth $6,000.00, which amount would pay off the first mortgage of about $3,000.00, to Mrs. Morehead, now held by Morehead Bank, and also the debt to said Carr and James, and nearly all of the Blacknall judgment; and that the Murphy holdings and the Johnson City property are both available and more than ample to pay off the balance due on the Blacknall judgment, the taxes and all other-debts of Rowland & Cooper, excepting a portion of their indebtedness to the Morehead Bank and the Eirst National Bank.

11. That the said J. S. Carr for and on behalf of himself and the Eirst National Bank, of which he is President, and the Morehead Bank are endeavoring to reverse the equitable and legal order in which the property of said Rowland'& Cooper shall be sold by the sheriff in order to pay off the debts of said firm and of the individuals composing the same. That to this end they have instructed the sheriff of Durham County to sell, and unless restrained by this Court, he will sell on the 6th of March, 1899, the following property of said Rowland & Cooper, or either of them, to-wit: first, the Prize House lot hereinbefore described; secondly, the Alston Avenue tract of fifty (50) acres; third, the excess over the Cooper homestead; fourth, the excess over the Rowland homestead; not selling or offering to sell any lands upon which said Carr or either bank holds a mortgage. •

12. That if said sale is carried out tire interest of the plaintiffs Janies and Watts, as above set out, will be destroyed, and they will lose nearly their entire debts, and thereby a preference will be given to the Morehead Bank and the Eirst National Bank, which was not contemplated by said Rowland & Cooper, and contrary to their directions as set out and explained in the instruments hereinbefore referred to, and that the plaintiffs James and Watts have equities which are prior in time and superior to those of the defendants in the lands proposed to be sold by the sheriff as aforesaid.

13. That the next term of Durham Superior Court begins on March the 2Yth, and the plaintiffs are advised that no legal sale can take place during the month of March until during the first 3 days of said court.

14. Plaintiffs again agree to pay off the Blacknall judgment, principal, interest and cost, provided it be transferred to said Watts, and hereby tender a sum sufficient to accomplish said transfer. They likewise agree to pay off the mortgage on the Cooper store, provided the same be transferred to said Watts, and hereby tender a sum sufficient to accomplish said payment and transfer.

15. That said J. S. .Carr, Morehead Bank and First National Bank elected to take under said aforementioned instruments, and took thereunder, and are estopped to deny the validity of same or the order of sale therein provided. Whereof plaintiff pray that said sale be restrained, and that the property hereinbefore described shall be sold in the order in which it was mortgaged to the respective mortgagees and trustees, and plaintiffs pray, that when this complaint is duly verified it may be deemed an affidavit in the cause, and as in duty bound they will ever pray.

16. That suit has been begun in Durham Superior Court in favor of plaintiffs and against defendants as above.

W. TI. Rowland, being duly sworn, states that the facts set forth in the foregoing complaint are true, except as to such as are stated upon information and belief, and as to those, he believes them to be true. W. H. RowlaNd.

February 24, 1899.

Sworn to and subscribed before me, February 27, 1899.

C. B. G-REEN, G. S. G.

His Honor, Bryan, J., at the hearing at Durham, March 27, 1899, ordered that the restraining order be dissolved and the motion for injunction to the hearing be denied.

Plaintiffs excepted, and appealed.

The plaintiffs then prayed the Court to indicate what amount of bond would be required to stop the execution sale, pending the appeal. His Honor declined to indicate the amount of bond, or to stop said sale pending plaintiff’s appeal to tbe Supreme. Plaintiffs excepted, as an additional ground for tbeir appeal.

Messrs. Winston & Fuller, for plaintiffs (appellant).

Messrs. Manning & Foushee, Guthrie & Guthrie, and Boone, Bryant & Biggs, for defendants.

MONTGOMERY, J.

Tbe plaintiffs Rowland & Cooper are tbe common debtors of tbe other plaintiffs and tbe defendants, except Markham. Tbe defendant Carr is a creditor by judgment lien of prior date to tbe incumbrances by way of mortgage of tbe other creditors.

Tbe object of this action is to compel the judgment creditor to levy upon and sell tbe real estate of tbe debtors, all of which was conveyed at different times and in separate parcels, by the rule of inverse order of alienation, that is, in the order in winch it was conveyed in the respective mortgages ; tbe allegations being that by such an order of sale all tbe debts can be paid, and that if tbe rule is not observed tbe other creditors, than the judgment creditor, will suffer.

An order was granted restraining the judgment creditor and tbe sheriff from selling any of the debtor’s real estate under tbe execution issued upon the judgment, and upon an application to continue tbe order of restraint — for an injunction until tbe bearing — the motion was refused, and tbe restraining order dissolved.

There was no error in tbe course taken by bis Honor. There was no allegation that tbe judgment or mortgage creditors were insolvent, and no allegation that irreparable loss would come to tbe plaintiffs if tbe restraining order was not continued. Tbe main action is still pending, and whatever rights tbe plaintiffs may have, can be established in that suit.

Tbe plaintiffs further excepted to tbe refusal of bis Honor to allow a bond in tbe nature of a supersedeas for tbe purpose of continuing tbe effect of tbe restraining order until the bearing, notwithstanding tbe order bad been dissolved by bis Honor. No sucb practice is allowable. “An appeal being merely tbe act of tbe party can not of itself affect tbe validity of tbe order of tbe Court, nor can it give new life and force to an injunction which tbe Court bas decreed no longer exists.” High on Injunction, sec. 893; Green v. Griffin, 95 N. C., 50.

No error.