Opinion
No. 43376.
September 14, 1953.
APPEAL FROM THE CIRCUIT COURT OF ST. LOUIS COUNTY, DIVISION NO. 2, JOHN A. WITTHAUS, J.
Boggiano Hessel and Meyer Hessel, St. Louis, for appellant, Erroll Thielecke.
Paul H. Chavaux, St. Louis, for respondents A. A. Davis and Theodore J. Growe.
Ziercher Tzinberg, Erwin Tzinberg and F. William Human, Jr., Clayton, for respondents Bernard D. Feinstein, William Klipper and Hattie Klipper.
Action to set aside a trustee's foreclosure sale (and the ensuing deed) under a power of sale contained in a deed of trust on the ground that the sale was void. Decree for defendants, and plaintiff appealed.
Thielecke, the plaintiff, sued as owner of the equity of redemption, he having acquired title from the former owners (Joseph C. and Virginia Mowry, the makers of the note and deed of trust) by quitclaim deed made two days before the sale. Defendants are the beneficiary and the trustee under the deed of trust, the purchasers at the sale, and an agent of the latter who acted for them in bidding in the property which consisted of an improved lot in a subdivision of St. Louis Country. The deed of trust secured a purchase money note for $7,930, which was payable in monthly installments as to both principal and interest.
In January, 1952, the Mowrys being admittedly in default to the extent of $1,200 in the payment of monthly instalments under the note (and for taxes due in 1949, 1950, and 1951), defendant Davis, the holder of the note and deed of trust, exercising the option given him under an acceleration clause contained in both of those instruments, declared the whole indebtedness due and payable, for which, and breaches of the covenant of the deed of trust with respect to the payment of taxes, Davis instructed the trustee to foreclose. The trustee's notice of sale, dated January 11, 1952, designated "Monday, February 4, 1952, between the hours of 9 o'clock A.M., and 5 o'clock P.M., as the time, and "the east front door of the Courthouse in the County of St. Louis and State of Missouri" as the place at which the foreclosure sale would be held. On the morning of, and immediately preceding, the sale plaintiff tendered to the trustee and to defendant Davis the arrears of principal and interest (for which acceleration had been declared), together with the delinquent taxes. The tender was rejected. It did not purport to be for the entire indebtedness, as accelerated, and so the sale was held, the property knocked off and sold at the price of $6,500 deed went to the purchasers, and this action was filed the next day.
The ground upon which plaintiff's petition claimed relief (and relied on in this court for reversal of the decree) is that the sale was void, allegedly, for these reasons: (1) That no default existed under the note and deed of trust at the time of sale, and (2) that the sale was held at a different place than that designated in the deed of trust and in the trustee's notice. The first proposition turns on the force of the acceleration clause, as affected by the tender of arrears made, so to speak, at the very brink of the sale. The acceleration clause in the note expressly provided that upon default in the payment of any of the monthly instalments when due "the holder of this note may, at the option of said holder, declare all unpaid indebtedness evidenced by this note immediately due and payable." A similarly worded, unambiguous provision of like import is contained in the deed of trust.
As we understand plaintiff's contention, it is that the effect of his tender was to cure the defaults, and, in consequence, the trustee was deprived of right and authority to proceed further in selling at foreclosure. But the difficulty with this position is that the cases on which he relies involved fact situations where the acceleration clause did not form a part of the basic contract, the note, but appeared only in the deed of trust. See Leone v. Bear, 362 Mo. 464, 241 S.W.2d 1008, and cases there cited. Lunsford v. Davis, 300 Mo. 508, 254 S.W. 878, and Graves v. Davidson, 334 Mo. 882, 68 S.W.2d 711 (the other two cases cited by plaintiff), are wholly dissimilar on their facts from those at bar, and for that reasons are inapplicable. We do not doubt the power of the courts to relieve, in a proper case against enforcement of an acceleration clause if the default be occasioned by something inequitable on the part of the creditor or trustee, as by misleading or deceiving the mortgagor, or by some other species of fraudulent conduct. But here nothing of the kind is present. Indeed, it appears that ten instalments of principal and interest were past due, and for such a grievous delinquency no semblance of an excuse or justification has been offered. Brown v. Kennedy, 309 Mo. 335, 274 S.W. 357,41 A.L.R. 729, is directly in point and controlling. It involved an acceleration clause contained in both the note and deed of trust, and tender of arrears made 17 days after publication of notice of sale had begun (and, while it makes no difference, it may be added, by a person who had acquired title that day) — substantially identical with the fact situation at bar. It was there held that the tender did not legally stop the foreclosure sale. See Anno., 41 A.L.R. 732 737, where at loc, cit. 734 it is stated: "It is generally held a tender of arrears, after a mortgagee has exercised his option to accelerate a mortgage on default of an instalment, does not prevent foreclosure." See, also, Wolfley v. Wooten, 220 Mo. App. 668, 675, 293 S.W. 73, 78.
Plaintiff's other complaint is that that the sale was held at a different place than that designated in the deed of trust and in the trustee's notice. Both instruments specified the same place, to wit, "the east front door of the Courthouse in the County of St. Louis, State of Missouri." In the interval between the making of the deed of trust in 1947 and the holding of the sale in 1952, St. Louis County erected a new courthouse into which some portions of the pre-existing structure were incorporated. The old one faced east: the new one, north. It is this circumstance which gives rise to the present contention. The door which was formerly known as the "east front door" is still intact and remains in limited use as a part of the combined structures. There is also another door on the east, which we understand to be a part of the new construction, and it is located to the north of the former "east front door."
The trustee appeared at noon at the "east front door of the old section" (the door at which all sales were customarily held before the new building was erected) and before reading the advertisement, he announced that the sale would also be held at the two other doors we have just mentioned. Besides the trustees there were present: Messrs. Davis, Hopewell (attorney for Davis and the trustee), Feinstein (the successful bidder), Mitleider, Bernstein, and "a gentleman from the Daily Record." One bid of $6,000 (that of defendant Davis) was received at the first, or "Old east front door" offering. The trustee then announced that he would "proceed to the most northern east front door, or the east front door of the new courthouse. and re-cry the sale." Those present followed the trustee to the door last mentioned, where he reread the advertisement, and mentioning the $ 6,000 bid, asked if it was still good, and being assured that it was, he then asked for further bids, but received none. The trustee testified that he then announced that he would proceed "to the north front door at the new courthouse and re-cry the sale again, and those of interest should follow: and they all followed." There were other persons standing at the north front door, including plaintiff Thielecke, who then there announced he was prepared to pay the delinquency, "waiving a fistful of money in the air," and, further, that if it wasn't accepted he was going to contest the sale. He had not appeared at either of the other doors at which the property was offered for sale.
We think plaintiff is in no position to urge that the procedure followed by the trustee "was confusing and misleading and placed an obstacle in the way of obtaining the best price for the property." Having himself served notice, in effect, that the purchaser was buying a law suit, he is estopped to complain of chilling the sale, at least insofar as the offering at the north door is concerned. He further contends that in the absence of a provision in the notice of sale that "in view of the construction of the new courthouse the sale would be held at the north front door of the new courthouse," the placed of selling was restricted to the "east front door" at which the property was first offered. He complains that the successive offerings required "prospective bidders to follow the trustee around to three different places and to flaunt in their faces the possible illegality of the sale. "We do not agree.
The specification in the deed of trust of a particular door of the courthouse should be regarded as subordinate to the main purpose of providing a place of sale at which the public customarily attends for such purpose. Inasmuch as the former "east front door" was no longer regards as such at the time of sale, it having been abandoned as the customary place for foreclosure sales, and being confronted with the recitals of the deed of trust touching the place of sale, and considering the hiatus as regards "customary selling place" created by the construction of the new courthouse, it seems clear that the trustee acted with prudence, fairness and zeal in satisfying both the letter of his notice and the spirit of the trust be was then discharging. Plaintiff seems to have relied on the north door as the place of sale, as he absented himself from the other places at which the property was offered. Not only this, but the better bid was received there, and it was more than sufficient to satisfy the indebtedness and costs, which amounted to more than 60% of the value of the property even under plaintiff's own evidence. The validity of the sale was properly upheld by the trial court, whose decree should be, and it is affirmed.
All concur.