Pattillo v. Tucker , 216 Ala. 572 ( 1927 )

The trial court prepared an able and elaborate opinion in this case which is, in the main, correct and which has been quite helpful to us in the consideration of this appeal.

The appellant insists that there was a valid foreclosure of the mortgage under the power of sale. As assignee of the mortgage he had the right to foreclose (Clark v. House,205 Ala. 195, 87 So. 593), but he cannot do this to the prejudice of the mortgagor after a bill is filed to redeem. "A mortgagee or assignee cannot, after bill filed by the mortgagor to redeem, proceed to foreclose under the powers, and thus cut off the privilege to exercise the equitable right of redemption." Johnson v. Smith, 190 Ala. 524, 67 So. 401. In the case of Presnell v. Burgess, 181 Ala. 270, 61 So. 804, it was held to the contrary, but this case was qualified, and it is the law that while such a sale is not absolutely suspended by the pendency of a bill to redeem, its exercise is subject to the equity of the bill as decreed by the court. Carroll v. Henderson, 191 Ala. 250, 68 So. 1; National B. L. Ass'n v. Cheatham, 137 Ala. 395, 34 So. 383. If the equity of the bill is not sustained, the bill should be dismissed. The bill in the instant case charges that the mortgagee or his assignee claimed more than was due under the mortgage and sought an accounting with an offer to pay whatever sum may be ascertained as due, and it was not necessary for the mortgagor to have tendered the amount and followed it into court as a condition precedent, as this bill seeks to enforce an equitable rather than a statutory right of redemption. Johnson v. Smith, 190 Ala. 524,67 So. 401. And the question of tender in cases of this character can only affect the taxation of cost. 27 Cyc. 1830.

The next and most serious question, as stated by the trial court, is whether or not the complainant mortgagor is conclusively estopped from disputing the amount due by his signed statement as to the amount due to the then mortgagee or her agent and his subsequent conduct in requesting Pattillo to purchase the mortgage, accompanied by a reaffirmation that the statement was correct. Ordinarily an obligor who procures another to take up or purchase his obligation is estopped from setting up any previously existing defense as against said obligation (Langley v. Andrews, 142 Ala. 672, 38 So. 238), or from pleading usury as against the assignee of said obligation who purchased same at his instance (Jones v. Moore, 212 Ala. 251, 102 So. 200). But it must also be borne in mind that a party who invokes an estoppel must have in good faith been ignorant of the true facts at the time the representation is made to him and at the time he acted thereon, and he must show that he acted with diligence to learn the truth. 2 Pom. Eq. (3d Ed.) § 810; 10 R. C. L. 696.

"Where, therefore, one with convenient opportunity to ascertain the real facts by the exercise of reasonable diligence fails to do so, he will not be permitted to defeat another's just rights by urging an equitable estoppel based upon his having acted to his disadvantage in reliance upon the other's innocently mistaken representation regarding the facts." 10 R. C. L. 696.

"If he knew, or under all the circumstances ought to have known the facts, the estoppel, even if the representation was made on oath, falls to the ground." Bigelow on Estoppel (5th Ed.) 627.

We are inclined to believe the respondent Pattillo's version of the transaction notwithstanding the denial of the complainant, but it appears that he procured the note and mortgage and had them in his possession some time before he finally purchased same from Miss Hartselle, the mortgagee. He is an intelligent and experienced business man, and the slightest examination of the instruments and calculation of interest would have clearly demonstrated a considerable error in the statement attached to the mortgage, and which was signed and subsequently admitted by the complainant, who was considerably inferior to Pattillo from a standpoint of intelligence and business experience. In other words, the slightest care would have disclosed a considerable difference between the amount actually due on the note and mortgage and the amount as set out in the statement. It is contended or suggested that the statement would be approximately correct if 10 per cent. interest were allowed if compounded, and that this merely amounted to usury and the complainant, in effect, waived the right to plead usury under the former decisions of this court. There might be merit in this contention if the discrepancy consisted entirely of usurious interest, but there is nothing in the papers which indicates that they were to bear usurious interest. On the other hand, the note expressly provides for 8 per cent. interest, and a computation at that rate would have disclosed the error in the statement signed by the complainant.

It is insisted that this complainant cannot maintain the present bill to redeem because he has conveyed the land to his son, citing the case of Cardwell v. Virginia State Ins. Co.,186 Ala. 261, 65 So. 80. This contention would no doubt be sound if properly presented by the pleading, but the record shows no unqualified or unconditional conveyance, the deed has been delivered in escrow, and there is nothing to indicate a compliance with the requirements essential to a final delivery.

Nor should the complainant be denied relief because of a failure to comply with a promise to secure to the respondent other debts extraneous to the subject-matter of the present controversy. 10 R. C. L. § 140; Harris v. Harris, 208 Ala. 23,93 So. 841. Moreover, the contract as to these other matters was not in writing and was void under the statute of frauds. Code 1923, § 8034; Thompson v. New South Co., 135 Ala. 630,34 So. 31, 62 L.R.A. 551, 93 Am. St. Rep. 49.

The decree of the circuit court is affirmed.

Affirmed.

SOMERVILLE, THOMAS, and BOULDIN, JJ., concur.

On Rehearing.