Opinion
No. 38268.
March 10, 1952.
1. Vendor and purchaser — assumption of outstanding indebtedness — bar of statute of limitations.
An outstanding indebtedness is something which has continued in existence, is owing in praesenti and is of such a nature that its payment may be enforced in a court of competent jurisdiction; wherefore, when the notes given for the balance of the purchase money of land and the deed of trust to secure them have become wholly barred by the statute of limitations, a conveyance by the original grantee which recites that her grantee will assume and pay all outstanding indebtedness against the land, does not operate as an extension of the original debt and does not vest in the original grantor an implied vendor's lien upon the land.
Headnote as approved by Hall, J.
APPEAL from the chancery court of Hinds Company; V.J. STRICKER, Chancellor.
Alexander Alexander, for appellant.
First: The statutes of limitation are not involved in this case.
Second: We are not seeking to enforce the original deed of trust from Mrs. Blumer to Alta Woods which appears barred of record.
Third: Our right arises by virtue of the covenant in the deed poll wherein Garber Brooks assumed and agreed to pay all outstanding indebtedness secured by instruments of writing of record in the chancery clerk's office. We are not seeking by this covenant to enforce any rights under the old deed of trust which was barred, but the said deed of trust, being an instrument of writing of record, securing an indebtedness against the land conveyed, identifies the indebtedness assumed.
Fourth: The covenant either meant what it said or it meant nothing. We cannot assume that the covenant meant nothing and thereby destroy the consideration for the deed.
Fifth: We are not trying to revive a barred debt of deed of trust securing same. A third party agreed to pay this old debt, and a deed was given in consideration of such agreement. We want to enforce this solemn covenant by establishing a vendor's lien against the land and foreclosing this lien, if the indebtedness assumed is not paid.
Garber-Brooks did not seek to revive the barred notes of Mrs. Blumer, but simply agreed to pay said notes — the fact that the notes were then barred was merely incidental. The agreement was to pay the indebtedness which was revealed by the old deed of trust of record. 14 Am. Jur., Sec. 4, p. 483; 21 A.L.R. 496; 47 A.L.R. 339; Harts v. Emory, 184 Ill. 560, 56 N.E. 865; Schmucker v. Sibert, 18 Kan. 104, 26 Am. Rep. 765; 37 Am. Jur., Sec. 1106, p. 384; Swanson v. Bennett, (Fla.), 25 So.2d 207; Davis v. Davis, 127 P. 1050.
Watkins Eager, for appellee.
I. Under the Mississippi statutes all right of action in Alta Woods Park, Inc. was extinguished and dead upon June 1, 1947, and no new cause of action has ever been created.
A. The old right of action to foreclose a mortgage or to sue on the note of November 8, 1939, does not now exist. Secs. 722, 743, 748, 875 Code 1942; Proctor v. Hart, 72 Miss. 288, 16 So. 595; Musser v. First National Bank of Corinth, 165 Miss. 873, 147 So. 783.
B. There is no vendor's lien to foreclose. Lunceford v. Hardin, 124 Miss. 48, 55, 86 So. 710; Welch v. Thigpen, 172 Miss. 5, 7, 159 So. 101.
C. Even if Alta Woods Park, Inc., not a party to the deed, might conceivably yet be able to foreclose a vendor's lien it still could not be accomplished here as no vendor's lien was created. Allen v. Hillman, 69 Miss. 225; Trustees of Canton Female Academy v. Gilman, 55 Miss. 149.
D. Even assuming that the writing does not have to be signed by the party chargeable thereby, the writing still contains no promise to pay the appellant. Black's Law Dictionary; Words Phrases; Samuel Lum v. Steamboat Buckeye, 24 Miss. 564.
II. The appellant is guilty of laches.
This suit presents the question whether appellant has an implied lien on four lots in Alta Woods Park Subdivision for a balance due on the purchase price thereof. These lots were sold by appellant to Mrs. Marcia C. Blumer on November 8, 1939, and the balance of the purchase money was due in eighteen monthly installments, seventeen being for $65.62 each, the last being due on June 1, 1941 for $65.71. They were secured by a deed of trust duly recorded.
Mrs. Blumer defaulted in the payment of a portion of the notes and she owed a balance of $341.67 principal thereon as of February 8, 1944. The notes became barred by the statute of limitation on June 1, 1947. Section 722, Code of 1942. The deed of trust likewise became barred on that date and was completely extinguished on December 1, 1947, for the reason that no renewal or extension thereof was noted upon the margin of the record thereof prior to that date. Section 875, Code of 1942; Perkins v. White, 208 Miss. 157, 43 So.2d 897; Musser v. First National Bank of Corinth, 165 Miss. 873, 147 So. 783; Proctor v. Hart, 72 Miss. 288, 16 So. 595. Prior to the running of said statutes appellant did nothing toward enforcing its security or payment of the balance due on the notes.
On September 10, 1948, after the notes had become barred and the security of the deed of trust extinguished, Mrs. Blumer conveyed the lots to Garber-Brooks Construction Company. Her deed made no mention of the notes or deed of trust to appellant but did contain this provision: "Grantee assumes and agrees to pay any and all outstanding indebtedness against the lands above described secured by instruments of writing of record in the aforesaid office of the chancery clerk."
Garber-Brooks Construction Company gave a deed of trust on these lots to E.R. Prenshaw on August 24, 1949, and the same was assigned by Prenshaw to appellee herein on December 7, 1949, by entry on the margin of the record thereof. In 1950 this deed of trust was foreclosed and the property was conveyed by the trustee to appellee on March 21, 1950.
Thereafter, on November 9, 1950, appellant filed this suit, admitting that its deed of trust was barred, but contending that the above mentioned provision in the deed from Mrs. Blumer to Garber-Brooks renewed the indebtedness and created an implied vendor's lien on the property in favor of appellant which is prior in right to all claims of appellee, and a foreclosure of this alleged implied vendor's lien was sought. The chancellor denied the relief prayed for and dismissed the bill, and in this we think he was correct.
What Garber-Brooks assumed by acceptance of the deed, and all that it did assume, was the "outstanding indebtedness' against the land secured by instruments of writing recorded in the chancery clerk's office. (Hn 1) In 67 C.J.S. p. 540, the first definition given of the word "outstanding" is "that stands over or continues in existence" and the last definition given by the text is "constituting an effective obligation." In Ford v. Mutual Life Insurance Co. of New York, 194 Miss. 519, 527, 13 So.2d 45, we held that an "indebtedness" must be something owing in praesenti and must be of such nature that its payment could be enforced in a court of competent jurisdiction. Furthermore, under the provisions of this deed the "outstanding indebtedness" assumed by the grantee was only such as was "secured by instruments of writing" etc. On the date of the deed there was nothing secured because the deed of trust was then dead and ineffective. From the foregoing authorities it is clear that the notes from Mrs. Blumer to appellant did not on September 10, 1948, or on November 9, 1950, constitute an effective obligation which could be enforced in a court of competent jurisdiction, and, moreover, that the security of the deed of trust had already been completely extinguished more than a year before Mrs. Blumer's conveyance to Garber-Brooks and more than three years before institution of this suit. There was no relation of vendor and vendee between appellant and Garber-Brooks nor was the quoted provision in the deed sufficient to constitute an extension of the indebtedness, and we are of the opinion that the chancellor correctly declined to establish an implied lien upon the property. The decree will therefore be affirmed.
Affirmed.
McGehee, C.J., and Kyle, Holmes and Ethridge, JJ., concur.