Opinion
No. 31284.
May 28, 1934.
1. MORTGAGES.
In suit by mortgagor for statutory penalty and actual damages resulting from mortgagee's failure to cancel mortgage of record after payment of mortgage debt and written request for cancellation, whether delay in cancellation was due to request of plaintiff held for jury (Code 1930, section 2155).
2. MORTGAGES.
Under statute providing penalty and damages for mortgagee's failure to cancel mortgage of record within one month of request for cancellation made after payment of mortgage debt, mortgagor could recover actual damages for delay, and additional penalty where failure to cancel was due to mortgagee's gross negligence and inattention (Code 1930, section 2155).
APPEAL from Circuit Court of Oktibbeha County.
Daniel Greene, of Starkville, for appellants.
The evidence shows that appellant did not in any way try to take advantage of appellee in order to invoke the penalty of the statute, but that appellee had ample time and notice thereof before written notice was given to cancel the trust deed, and under the statute had more than one month from the written notice to cancel without incurring any penalties.
If the evidence in this case does not justify invoking this statute, then it is a useless law.
Section 2155, Code of 1930.
We respectfully submit that the court erred in directing the jury to find for appellee.
There is no evidence or law in this case to sustain the judgment of the lower court.
Will E. Ward, of Starkville, for appellee.
Appellee has made no effort to improperly retain its lien. Immediately upon payment of the debt the trust deed and note were cancelled and returned to appellants and orders of cancellation of record prepared, executed, and mailed out to the local association that handled the loan for appellants. There was no act or omission on the part of appellee to justify the imposition of the penalty here sought to be imposed.
This court has emphatically held that Section 2155 is a highly penal statute and must be strictly construed against the one seeking to invoke it.
British American Mortgage Co. v. Burke, 80 Miss. 643, 32 So. 51; Johns v. Ferguson, 153 Miss. 807, 121 So. 485.
This is an appeal from a judgment in favor of the appellee in a suit brought by the appellants to recover a statutory penalty of fifty dollars and twenty-five dollars actual damages, because of the failure of the Federal Land Bank of New Orleans, appellee here, to cancel a deed of trust of record after written notice so to do under section 2155, Code 1930, reading as follows:
"Any mortgagee or cestui que trust, or the assignee of any mortgagee or cestui que trust, of real or personal estate, having received full payment of the money due by the mortgage or deed of trust, shall enter satisfaction upon the margin of the record of the mortgage or deed of trust, which entry shall be attested by the clerk of the chancery court and discharge and release the same, and shall bar all actions or suits brought thereon, and the title shall thereby revest in the grantor. And if such mortgagee or cestui que trust, or such assignee, by himself or his attorney, shall not, within one month after request, cancel on the record the said mortgage or deed of trust the beneficiary shall forfeit the sum of fifty dollars, which can be recovered by suit on part of the party aggrieved, and if after request, he fails or refuses to make such acknowledgment of satisfaction, the person so neglecting or refusing shall forfeit and pay to the party aggrieved any sum not exceeding the mortgage money, to be recovered by action; but such entry of satisfaction may be made by any one authorized to do it by the written authorization of the mortgagee or beneficiary, and shall have the same effect as if done by the mortgagee or beneficiary."
The case originated in a justice of the peace court where judgment was rendered in favor of the appellants. The facts are that R.E. Dawkins, the father of the appellants, during his lifetime, gave the Federal Land Bank of New Orleans a deed of trust on lands in Oktibbeha and Winston counties, Mississippi, which mortgage was recorded in each of these counties. After his death, the appellants paid the debt on December 5, 1932, and the note and mortgage were returned to the appellants. An order for cancellation was sent to the Sturgis National Farm Loan Association, at Sturgis, Mississippi, accompanied by a check for a sufficient amount to pay for the cancellation in Oktibbeha county where the Sturgis National Farm Loan Association was domiciled, it being the instrumentality through which loans could be procured under the federal law upon that subject. The records in Oktibbeha county were canceled as to this mortgage, but the records in Winston county were not marked "satisfied" or canceled. There was also a farm loan association, similar to the Sturgis National Farm Loan Association, in Louisville, Winston county, Mississippi, from which loans could be procured, and one of the appellants went to the Sturgis office and requested that office to write to the Federal Land Bank at New Orleans to have the Winston county mortgage marked "satisfied," and then also went to Louisville, Mississippi, and made an effort to have this done, but could not do so, and he had the Louisville office also write the Federal Land Bank at New Orleans, furnishing postage, etc., to have the Winston county mortgage canceled, but same was not done.
On June 5, 1933, the appellants wrote to the Federal Land Bank of New Orleans a letter as follows:
"I am writing you in regard of the R.E. Dawkins land. I paid it out last November and you mailed me the note on Dec. 5, 1932, and I was at Louisville last week and it is still on record have not been cancelled and I wish you would please tend to that at once and get it off for I have the note stamped paid in full and it has not been canceled and I want that done at once and please see to that at once and I remain,
"As ever yours truly, "W.C. DAWKINS."
On June 9, 1933, said letter was answered as follows:
"In response to your letter of June 5th, we wish to advise that the note, trust deed and abstract in connection with the above loan (R E Dawkins, Sturgis, NFLA #4157) were sent forward to you on December 5th and order of cancellation to satisfy the trust deed of record was sent forward to the Sturgis National Farm Loan Association. c/o Mr. Herman Hunt, secretary-treasurer on the same day. We, therefore, suggest that you get in touch with Mr. Hunt in reference to this matter and we feel sure that he will explain the same fully to your satisfaction.
"Yours very truly, "F R ANSELMENT."
On June 22, 1933, the Federal Land Bank of New Orleans wrote to the Sturgis National Farm Loan Association, as follows:
"This will acknowledge receipt of your letter of June 12, advising us that the mortgage executed to this bank in connection with the above loan (R E Dawkins, Sturgis, #4157) is still outstanding on the records of Winston county, and requesting that we forward you check to cover cost of canceling same. In response to your request, we are attaching hereto check in the amount of one dollar and twenty-five cents, and we will thank you to have this instrument properly satisfied of record in Winston county. However, if you are some little distance from Louisville, and do not care to make the trip for this purpose, we suggest that you forward it to the Winston County National Farm Loan Association in care of Mrs. E.W. Boydston, secretary-treasurer, as Mrs. Boydston has advised us that she will take care of this matter for us.
"Very sincerely yours, "F R ANSELMENT, Attorney."
On July 12, 1933, the chancery clerk of Winston county certified that the deed of trust on lands involved in that county had not been canceled.
The appellants testified that W.O. Dawkins went to Louisville to look after the cancellation, and that same could not be done without an order from the Federal Land Bank of New Orleans, and that this trip cost him twenty-five dollars.
The manager of the Sturgis National Farm Loan Association testified that he received the notice of cancellation accompanied by a check, and that he canceled the deed of trust in Oktibbeha county, but did not cancel the one in Winston county after he received the letter from the Federal Land Bank of New Orleans above set forth, because W.O. Dawkins requested him to wait, stating that the local bank had a deed of trust on one of the brother's interest in the property, and that the bank would jump on the property as soon as the cancellation was made.
This was denied by W.O. Dawkins, and he proved the statements outside of court by the agent of the Sturgis National Farm Loan Association to the effect that he only received such authorization and check after this suit was instituted.
In the circuit court, at the conclusion of the evidence, there was a directed verdict in favor of the Federal Land Bank of New Orleans, from which this appeal is prosecuted.
We think, on the evidence, that it was a question for the jury to decide. If the testimony of the representative of the Sturgis National Farm Loan Association is true, then he was requested not to cancel the Winston county records by the appellants, and then, of course, there would be no liability for failure to so cancel. If, however, there was no such request, and if the testimony for the appellants be true, they would, at least, be entitled to a judgment for the actual damages. They would also be entitled to the statutory penalty, if the jury believe, from the evidence, that the failure to cancel was the result of gross negligence and inattention to the matter on the part of the Federal Land Bank.
It will be noted from the letter of the Federal Land Bank to the Sturgis National Farm Loan Association, above set out, that said Federal Land Bank had arranged with its representative at Louisville to cancel if it was not convenient for it to be done from the Sturgis office.
Whether the appellee should have sent the authority direct to its representative at Louisville, Mississippi, or to the clerk of the chancery court, should also be considered on a retrial of this cause.
For the errors indicated, the judgment of the court below will be reversed and the cause remanded for a new trial.
Reversed and remanded.