XIII. Disposition of the Proceeds of Sale.-The surplus proceeds of the sale stand in place of the equity of redemption in the land for those who have a lien upon or an estate or interest in this equity of redemption. The general course of practice is for the surplus proceeds to be paid into court to await the distribution. The distribution will be made, under the orders and direction of the court, amongst those entitled according to their respective equities and in the order of priorities. A reference should be ordered directing the master or special referee to ascertain and report the amounts due, respectively, to the various claimants, as well as all facts. necessary to determining priorities, adjusting conflicting equities, and to the apportionment of the fund between the claimants. This report is open to exceptions, and may be confirmed or set aside and a new reference ordered, as the court shall determine. Where the rights of the various claimants have been ascertained and adjusted, the distribution will be made in accordance with such adjustment.1 judgment against the mortgagor for debt, although no decree in rem, can be rendered because of the sale of the mortgagor's interest in the premises under an execution, for the reason that the power of attorney had not been recorded with the mortgage. Du Val, Adm'r, v. Johnson et al., 39 Ark. 182. A personal judgment rendered on the mortgage debt at the suit of the mortgagee, who had taken out execution upon the judgment, and had the mortgaged premises sold under it, and bid off the property at the sale, is void, and may be so declared at the suit of the mortgagee. So held in Boone et al. v. Armstrong, 87 Ind. 168. The mortgagee is not bound by the relation of principal and surety, created between the mortgagor and his vendee, where the vendee, on a sale to him of the mortgaged premises, has assumed the payment of the mortgage debt. And where, after foreclosure, the mortgagor is sued for the balance unsatisfied of the mortgage debt, it is no defence to the suit. that his vendee had, with the permission of the mortgagee, removed certain personalty embraced in the mortgage. Where vendees of the mortgagor assumed to pay the mortgaged debt in specified proportions, which were recited to be part of the consideration of their purchase, it was held, in an action against them by the mortgagee, to recover a deficiency arising from a foreclosure sale of the mortgaged premises, that there was a sufficient consideration to sustain the covenaut of the vendees, and that mortgagee could recover. Hand v. Kennedy, 83 N. Y. 149. 1. The court, when by proper service it has obtained jurisdiction, has equitable powers sufficiently broad to reach all the equities, and to adjust all the rights and liabilities, of the various parties; and it will settle, and dispose of, and enforce the whole in one suit. Chapworth 2. Dressler, 2 Beasley Ch. (N. J.) 62. Fithian v. Monks, 43 Mo. 502. The report of the referee upon the reference to ascertain the amount of claims upon the surplus, and the liens and priorities of the respective claimants, etc., should show that notice of the application for the distribution of the surplus had been given to all the parties in interest in the foreclosure suit; and, if the notice has not been given, the order directing the distribution of the fund will be set aside. Smith v. Smith, 13 Mich. 258. If there is no one interested in the surplus but the mortgagor, and he dies pending the suit, the surplus goes to his heirs. Shaw v. Hoadley, 8 Blackf. (Ind.) 165. Although it has been held that the surplus is personalty going to the personal representative. Smith v. Smith, 13 Mich. 258. Compare Dunning v. Ocean Nat. Bank, 61 N. Y. 497; Wright v. Rose, 2 Sim. & Stu. 323. The surplus, under foreclosure of real estate mortgage, stands in the place of the equity of redemption, possesses all the properties of realty, and goes to the heir; and when paid to the administrator of the mortgagor, his widow cannot claim it as personalty exempt under the statute. Beard, Adm'r, . Smith, 71 Ala. 568. A junior judgment creditor of the mortgagor is entitled to be paid out of the surplus, notwithstanding an agreement which was carried into effect between the mortgagor, the last mortgagee, and one A, made at the time the tract of land was to be sold under several mortgages, that A should bid off the land at $3000 (which amount was insufficient to pay all the mortgages) but that he should actually pay $3939.85, a sum more than sufficient to pay them all, and the surplus should be paid to the last mortgagee to indemnify him against a liability he had assumed for the mortgagor. Held, also, that this surplus could be reached by garnishment against the last mortgagee. McGuire v. Wilkinson, 72 Mo. 199. Where the sheriff had embezzled a part of the money upon the sale of mortgaged lands made by him, it was held that the amount so embezzled should not be credited on the mortgage; that the sheriff was not the agent of the mortgagee. Chalmers v. Turnipseed, 21 S. Car. 126. Where a mortgage had been given to secure both an individual note and a joint note, and was insufficient to pay both, the holder is under no obligation to apply proceeds pro rata; but may apply entire proceeds on individual note. Small v. Older, 57 Iowa, 326. An independent action will not lie, by a junior mortgagee, to reach surplus under a foreclosure by the senior mortgagee. He must come into that proceeding. Fliess v. Buckley, Adm'r, 90 N. Y. 286. The surplus money remaining under a foreclosure sale by a junior mortgagee cannot be claimed by a senior mortgagee, or one having his rights by subrogation. He must foreclose his own mortgage. Firestone v. State, ex rel., 100 Ind. 226. A second mortgagee instituted his suit to foreclose his mortgage and made all lienholders, prior and subsequent, parties, and moved for a receiver to collect the rents pending the suit, which application was refused. Subsequently a junior mortgagee instituted his action to foreclose, making all lienholders parties, and a receiver was appointed. The court held that the funds collected by the receiver should be applied to the liens in the order of their priority. Williamson v. Gerlach, 71 Ga. 682. On foreclosure sale of a homestead exceeding $1500, the surplus must be applied on the mortgage of the homestead before making any application thereof on antecedent levies. Vermont Savings Bank v. Elliott at al., 53 Mich. 257. The vendee, to whom his mother had conveyed the land, taking his bond, payable to her daughter (who was a person of week mind) for the purpose of provid ing for her, gave a mortgage on the land to another one of her sons to secure the bond, and subsequently sold the equity of redemption in the land to another one of the sons. The holder of the mortgage filed his bill for foreclosure, making the mortgagor and his vendee parties. Held, that the transaction constituted the complainant trustee for the daughter, and that, in this proceeding, the holder of the equity of redemption could not be heard to claim that the fund should be secured for the benefit of the daughter, or enjoined from passing into complainant's hands. Nugent . Nugent, 50 Mich. 377. As to distribution of surplus under complicated state of facts, see Erie County Savings Bank v. Roof et al., So N. Y. 591. The order of priority of liens should be observed in the distribution of the surplus. Averill v. Lorcks, 6 Barb. (N. Y.) 470; Baker & Hall v. Gladden, 72 Ga. 469. The mortgagee himself may be a claimant on the surplus by reason of an independent claim,-Beekman Fire Ins. Co v. First M. E. Church, 29 Barb. (N. Y.) 658;-so a junior mortgagee; -Kenton Spencer, 6 Ind. 321. Mortgages are entitled to priority in the distribution, over subsequent judgments, even although unrecorded. Knell v. Green St. Building Asso., 34 Md. 77. The creditor has in such case the same rights, and no greater, that his debtor had. Norton v. Williams, 9 Iowa, 529. Simultaneous mortgages, although held by different persons, are entitled to share equally out of the surplus. Dagget v. Rankin, 31 Cal. 321. Where only a part of the mortgaged premises is foreclosed, upon which part there are other encumbrances, the proceeds can only be applied on a proportional part of the debt, and the balance towards such other encumbrances in their order. Mickle v. Rambs, 1 N. J. Eq. 501. Mechanic's liens, although not ripened into judgment, are entitled to share. Livingston v. Mildrum, 19 N. Y. 440. A dower interest is extinguished to the extent of the debt secured by the mortgage, but the remainder of the dower interest is a claim upon the surplus where the wife has joined in the mortgage, Jones on Mort., (2d Ed.) § 1693, and authorities cited. See also 1694. An attachment of the surplus is subordinate to the claims under mortgages or other encumbrances of record. West v. Shryer, 29 Ind. 624. Where a partner executes a mortgage upon his interest in the partnership property, the mortgagee's interest and rights are subject to all the equities of the partnership, and are limited to what remains after these equities are fully adjusted, and a full accounting of the partnership business is necessary to determine this; but this accounting may be had in the foreclosure suit, as it is essential to the ascertainment of the mortgagor's interest. Churchill. Baron, Proctor et al., 31 Minn. 129. As to the disposition of costs in the foreclosure suits. see Scattergood v. Keeley, 40 N. J. Eq. 491 Trustee's Commissions.-Where trustee, on sale, received from purchaser only part of the purchase-money, and obtained an order for resale, and resold it, he is entitled to commission only on amount actually received on first sale, and on whole amount of resale. McCullough 2. Pierce, 55 Md. 540. Attorney's Fees.-No greater amount for attorneys' fees than the sum stipulated for in the mortgage can be allowed. Palmeter v. Carey, 63 Wis. 426. A provision in a mortgage, to pay a reasonable sum for fee of complainant's solicitor in foreclosure suit, to be included in the decree, if the intention was to indemnify the mortgagee against the expense of foreclosing is allowable, but will not embrace unnecessary and useless services of a solicitor, however laborious or extensive. Soles v. Sheppard, 99 Ill. 615. The circuit court has no power to adopt a rule allowing a fee of $30 to complainant's solicitor, under an order of sale. McCullough v. Pierce, 55 Md. 540. Where the mortgage stipulates for a certain amount for attorney's fees, it is in the sound discretion of the court to determine whether the whole or any part thereof shall be embraced in the foreclosure decree; and, if the mortgagee himself conducts the foreclosure suit, nothing should be allowed him under this stipulation. But where the full amount was allowed without objection in the court below, it is not reversible error. Reed v. Catlin, 49 Wis. 686. Attorney's fees stipulated for in the mortgage may be allowed although the complaint contained no allegations respecting them further than that the mortgage was executed, a copy being attached to the complaint. Kern Valley Bank v. Chester, 55 Cal. 49. When the answer alleged that the plaintiff's attorney received a regular salary in compensation for all his ser vices, and that plaintiff had not agreed or become liable to pay anything for services in this action (in an action to foreclose a mortgage stipulating for an attorney's fee), but the court failed to find upon the issue, and allowed the attorney's fee stipulated for in the mortgage, held, error, and cause reversed. Bank of Woodland 7. Treadwell, 55 Cal. 379. In a case where the mortgage provided for an attorney's fee of $50, at the foreclosure sale the mortgagee bid off the premises for a sum exceeding by about $40 the debt, costs, taxes, and insurance. It was held that this $40 must be paid over to the owner of the equity of redemption. In such case the mortgagee is estopped, at least in the absence of evidence from insisting that he did not have to bid this surplus sum to obtain the land, and cannot be heard to say that this part of his bid was fictitious. Kennedy v. Brown, 50 Mich. 336, 343. Stipulations in mortgages for attorney's fees are subject to the equitable control of the court, and will be enforced only to extent of reasonable compensation, and the court may refuse any allowance where the debtor has been misled by the creditor; but, to justify such an exercise of discretion, the debtor should attest his sincerity and good faith by promptly paying or tendering the amount of debt and interest, exclusive of commissions. Lewis v. Germania Savings Bank, 96 Pa. St. 86. Where the mortgage provides that, in case of foreclosure, the mortgagor will pay "a reasonable and customary sum for attorney's or solicitor's fees,' the amount must be ascertained by evidence. Voechting v. Grau, 59 Wis. 312. The mortgage contained a stipulation that, in case of foreclosure, or suit on the notes, the mortgagor would pay all attorney's fees and commissions, not less than 10 per cent on the amount for which the foreclosure might be had, and all costs and expenses incurred, and that such fees and expenses should be considered as part of the mortgage debt, and as amply secured by the mortgage as the debt itself. The court allowed 10 per cent to plaintiff's attorneys in the foreclosure suit. Held, that this was proper; that the fees, by the terms of the contract, were as much a part of the debt secured as the notes themselves. The case was distinguished from 49 Ga. 604, a case of factor's lien, which was governed by the statute. McCall v. Walter, 71 Go. 287. Where a mortgage which contained a XIV. Remedies against the Purchaser.-The person who purchases at the sale in the foreclosure proceeding becomes a quasi party to the suit, and thereby submits himself to the jurisdiction of the court so as to be liable to its orders and decrees against him in all matters connected with the sale or relating to him as purchaser; and the orders and decrees or judgments against him may be enforced by the ordinary process of the court, and, if necessary to enforce compliance, by its extraordinary compulsory process.1 power of sale authorized a sale on default, and payment, out of proceeds, of "all costs of foreclosure, including attorney's fee," this only confers authority to so pay in case of a sale under the power, and does not authorize the allowance of attorney's fee for filing a bill for foreclosure. So held in Bynum v. Frederick, 81 Ala. 489. Where a personal judgment had been rendered against a husband in a decree to foreclose a mortgage upon wife's prop. erty, and in said judgment was included an amount allowed for attorney's fees, a motion by the husband to strike out of this judgment the amount so allowed was properly overruled, as, if the land failed to bring enough to satisfy the resi due of the judgment, the amount for attorney's fees was proper. Ogborn 2. Eliason, 77 Ind. 393. 1. By the English practice, as it now exists, the court may, upon failure of the purchaser to comply with the terms of sale, make an order upon him to pay the money into court, and, ordinarily, will do so where he appears to be responsible, and may enforce such order by attachment against his person; or may, instead, order a resale of the property, and charge the purchaser with the expenses of such resale, and may enter judgment against him for any deficiency in the price at the second sale as respects the price at the first sale. 2 Daniel Ch. Pl. & Pr. (5th Ed.). *1282. [By the former practice, forfeiture of the deposit was the only remedy. Saville v. Saville. 1 P. Wms. 745.] The same course of practice is adopted in the American courts. Richardson v. Jones, 3 Gill. & J. (Md.) 163; Brasher's Ex'rs v. Cortlandt, 2 John. Ch. (N. Y.) 505; Clarkson v. Read, 15 Gratt. (Va.) 288; Simmons v. Tongue, 5 Bland (Md.). 341; Harding v. Yarbrough, 6 Jones Eq. (N. Car.) 215, n. Vannerson 2. Cord, 1 S. & M. Ch. (Miss.) 355; Townshend v. Simon, 9 Vroom (N. J.) 239; Haralson v. George, 56 Ala. 295; Gordon v. Sims, 2 McCord Ch. (S. Car.) 151; Cowell v. Lippitt, 3 R. I. 92; Wood v. Mann, 3 Sumn. (U. S.) 318. By becoming a purchaser, he submits himself to the jurisdiction of the court,Regna v. Rea, 2 Paige (N. Y.), 339;-he becomes a quasi party to the suit,-Eagan z. Phieter, 5 Sneed (Tenn.) 296;—and the court may give judgment against him and his sureties, Deadirick v. Smith, 6 Humph. (Tenn.) 138;—and may, by attachment against his person, be compelled to complete his purchase,-Wood 7. Mann, 3 Sumner 318; Graham v. Bleakie, 2 Daly (N. Y.), 55; Gordon v. Sims, 2 McCord Ch. (S. Car.) 157;—and his surity also,-Wood v. Mann, 3 Sumn. (U. S.) 151;—but there must be an order passed for the payment by him of the purchase-money before an attachment can issue against him,-Cowell v. Lippitt, 3 R. I. 92. It is not for the purchaser to say what remedies shall be pursued against him for non-compliance; nor whether or not there shall be a resale of the property. Wood v. Mann, 5 Sumn. (U. S.) 318. The parties interested in enforcing compliance may, if they see proper, file a bill against him for specific performance, Bowne v. Ritter, 26 N. J. Èq. 456;—but proceedings in the suit itself to compel performances is the better course. The person making an advance on the bid may likewise be held liable in the suit itself in the same way as the purchaser may be held liable. Allen v. East, 4 Baxt. (Tenn.) 308. Payment cannot be resisted after confirmation and after the time for appeal has expired, upon the ground of irregularities in the sale. (Todd v. Dowd, I Metc. (Ky.) 281; see Spence v. Armour 9 Heisk. (Tenn.) 167), where the court rests its refusal to relieve the pur-▾ chaser upon the ground that he had full knowledge of the defect in the title at the time of the sale. When the purchaser has given his note for the purchase-money, the land may again be sold, for the payment of such note. Such order of sale should be based upon a rule on the purchaser to show cause why the land should not be sold. Clarkson v. Read, 15 Gratt. (Va.) XV. Rights of the Purchaser.-Whilst the purchaser's right to the ownership and possession of the property does not exist until confirmation of the report (as, until confirmed, there is no sale), yet, upon the confirmation, his right to the title and to the possession is complete. Upon the confirmation, he is entitled to be vested with the title, either by the execution of a deed by the master or commissioner who made the sale, or by divestiture and vestiture in him of the title by the decree itself, when such mode is according to the practice of the court.1 If the deed has already been executed and delivered, the confirmation of the sale relates back to this delivery and makes the deed operative from its date. There is no uniform practice in the American courts as to the time at which the deed should be executed and delivered, whether before or after confirmation. The deed relates to the date of the mortgage, and invests the purchaser with such title as the mortgagor had at the execution of the mortgage, and passes the property as it then was. The purchaser is entitled to the crops growing at the time of the delivery of the deed; but not to the rents between the time of the sale and delivery of the deed.3 He is entitled to possession from the date of demand, after the execution of his deed. The court, by orders in the foreclosure suit, usually by injunction or writ of assistance, will compel the person in possession of the property to surrender the possession to the purchaser whenever such person is a party to the suit, or has come into possession pendente lite; otherwise, the purchaser must enforce his right by independent suit. If the owner in possession has the right to redeem under a prior mortgage, his possession cannot be disturbed. If a party in possession relies upon his right to the possession under a title claimed to be paramount to the 288. Compare Richardson v. Jones, 3 to revocation upon reversal of the deGill. & J. (Md.) 163. cree,-Taylor v. Boyd, 3 Ohio, 337;—but the decree may still order the execution of a deed to be enforced by attachment, if necessary,-Randall v. Pryor, 4 Ohio, 424. The purchaser cannot escape the compulsory process of the court by a forfeiture of his deposit,-Brasher's Ex'rs v. Cortlandt, 2 Johns. Ch. (N. Y.) 505; but this forfeiture may also be enforced,-Willets v. Van Alst, 26 How. Pr. (N. Y.) 325. 1. In Connecticut, courts of equity are authorized by statute to pass the title to real estate by decree, without any act on the part of the defendant, where in their judgment it shall be the proper mode to carry the decree into effect; and shall be as effectual to transfer the title as a deed. King v. Bill, 28 Conn. 593. So in Tennessee-Code of 1884, § 5234;— or may require the execution of a deed,SS 5235-5236, and may compel its execution by attachment and sequestration, -$5237. So in Ohio,-Taylor v. Boyd, 3 Ohio, 337; but, as between the parties, subject 8 C. of L.-18 2. Lane v. King, 8 Wend. (N. Y.) 584; Parker v. Storts, 15 Ohio St. 351; Jones v. Thomas, 8 Blackf. (Ind.) 428. 3. Clason v. Corley, 5 Sandf. (N. Y.) 447; Astor v. Turner, 11 Paige (N. Y.), 436; s. c., 43 Am. Dec. 766, and note; Beckman v. Sikes, 35 Kan. 120. See Taliaferro, etc., v. J. P. Gay, 78 Ky. 496. In Tennessee the purchaser is entitled to the rents only from the confirmation of the report of sale by the court. Armstrong v. McClure, 4 Heisk. (Tenn.) 80. In Lathrop v. Nelson, 4 Dill. (U. S.) 194, the purchaser was held entitled to the rents between the sale and the confirmation. See Taylor v. Cooper, 10 Leigh (Va.), 317; Wagner v. Cohen, 6 Gill (Md.), 102. 273 |