Wells, May & Sanders, of Jackson, for appellant. J. T. Lowrey, of Gloster, and J. McC. H. B. & J. M. Greaves, of Canton, for appel-Martin, of Port Gibson, for appellees. lant. R. H. & J. H. Thompson, of Jackson, and Walter M. Allen, of Springfield, Ill., for appellee.

vailing evidence of the agency of the attorney her. Subsequent to the filing of the bill, the for the mortgagor rather than for the mortgagee. appellant proceeded to foreclose her mort9. MORTGAGES 210 AGREEMENT TO DISgage under the power of sale therein provid

CHARGE PRIOR INCUMBRANCE.

Where the agent for the mortgagee in exe-ed; but, according to the authority of Carcuting the loan gave written assurance to the roll v. Henderson, 191 Ala. 248, 68 South. 1, mortgagor that he would retain from the loan- the right to exercise the power to foreclose ed sum an amount sufficient to discharge a prior by a sale is postponed or subordinate to the incumbrance on the mortgagor's land in favor of a third person, such assurance was effective to establish the relative rights of mortgagor and mortgagee, and the obligation of the mortgagee to see that the prior mortgage debt was discharged through seasonable application of the money retained.

Mayfield, Sayre, and Gardner, JJ., dissenting. Appeal from Circuit Court, Madison County; R. C. Brickell, Judge.

Suit in equity by George D. Atchley against Mary F. Thompson to redeem, and to cancel and surrender a mortgage. From decree for complainant, respondent appeals.

Affirmed.

The power of attorney executed by Mrs. Thompson to Petty is as follows:

equity to redeem, put into effective previous motion by the filing of the bill to redeem. The writer entertained and set down a different view (Presnall's Case, 181 Ala. 263, 270, 61 South. 804; Carroll v. Henderson, 191 Ala. pp. 253-258, 68 South. 1); but the decision of the court was as stated, and its rule must be here observed and applied, to the end that the appellee's right to redeem under his equity, not in virtue of the system provided for statutory redemption, is clear and is to be given effect.

F. T. Petty was a practicing attorney at Huntsville, who made loans of money of others on mortgage, and Mrs. Thompson also resided there. Previous to March, 1915, appelState of Alabama, Madison county. Know all lee had executed to Mrs. Humes a mortgage men by these presents, that I, Mary F. Thompon his land to secure a note for $1,500. Apson, of Madison county, Ala., do hereby constitute Turner Petty, of Madison county, Ala., pellee approached Petty for a loan, and durmy true and lawful attorney for and in my being the interview Petty advised appellee that half to receive and to hold in charge any or all of my notes and mortgages which I may turn over to him, for the purpose of collecting, and he shall collect, the interest on same, and give receipts for same, or in my absence sign my name by him as attorney as I may direct. Said Turner Petty is to give written receipts to Mary F. Thompson for all papers delivered to him. Also to collect all mortgages and notes when due, giving. receipt therefor, and have the power of attorney to mark said mortgage or note paid in full, and in my absence to cancel the mortgage on the record at the courthouse, and wherever else they may appear on record, giving said Turner Petty the power, in my absence, to set aside such mortgages as fully and completely as though I had marked them satisfied myself in person. This power of attorney is given for the express purpose of giving the said Turner Petty the power and authority, as I may advise, to collect any or all mortgages and notes that may become due to me from time to time, and to receipt for same, and to mark them satisfied as above stated. I, Mary F. Thompson, do hereby ratify and confirm whatsoever my said attorney may do in the premises, according to contract. Given under my hand and seal this the 1st day of August, 1912.

W. F. Esslinger and Betts & Betts, all of Huntsville, for appellant. David A. Grayson and James H. Ballentine, both of Huntsville, for appellee.

MCCLELLAN, J. At the time this bill was

filed by Atchley (appellee) against Mrs. Thompson (appellant) there was an outstanding unforeclosed mortgage on appellee's lands in Madison and Marshall counties to secure appellee's note to appellant for $3,000.

[1] Redemption, under the equity to that end, was the original bill's object, together with the cancellation and surrender to appellee of an elder mortgage on the land given by the appellee to Mrs. Humes, which the appellant had caused to be transferred to

appellant had money appellee could borrow on his land, if the title was good; but that appellant would not take a second mortgage -a mortgage subordinate to that held by Mrs. Humes. The loan of $3,000 to appellee from appellant was agreed upon between Petty and appellee, without consultation or communication between appellee and appellant; the appellee promising to pay Petty $100 for his services in the premises, to be deducted by Petty from the sum so borrowed. Petty investigated and approved appellee's title to the lands, drew the appellee's note and mortgage to appellant for the loan, and turned them over to appellee for execution by his then absent wife.

It was agreed by Petty and appellee that Petty should deduct from the loaned sum the amount, among others, of Mrs. Humes' mortgage debt and interest and discharge Mrs. Humes' debt, thus, in consequence, relieving the land of the mortgage prior to that of appellant, and pay to the appellee the net difference between the indebtedness of and charges against the appellee and the $3,000 so borrowed. A short time subsequently, the appellant delivered her personally signed check for $3,000, payable to appellee, to the teller of the bank with which she did business in Huntsville, directing him to deliver the check to appellee when the teller received from him the properly executed note and mortgage for the loan. This check was delivered and later cashed, and the appellee's note and mortgage were delivered to the teller, and subsequently these papers were turned over by the teller to the mortgagee, the appellant. Appellee denied the delivery of the check to him or to any

one for him, and also denied the indorsement | as assignee of Mrs. Humes; and, on the of the check, which indorsement was in the other hand, if Petty was Atchley's agent in name of the payee in the check, the appellee mortgagor.

that particular and failed to perform the service Atchley commissioned him to perform, Mrs. Thompson was not then and has not since been concerned in the default of Petty in respect of his agency for Atchley.

[2-4] Agency is a matter of contract, and its existence may be implied. Proof of its existence may be made through circumstances surrounding the parties and their conduct as well, unless it is a character of agency required to be constituted by a writing. Where the asserted agency rests in parol, and there is other evidence tending to show the fact of agency, the declarations of the alleged agent are admissible. Robinson v. Greene, 148 Ala. 434, 43 South. 797; MillerBrent Lumber Co. v. Stewart, 166 Ala. 657, 51 South. 943, 21 Ann. Cas. 1149. The distin

While the evidence is conflicting, at least in degree, on the issue whether the appellee received or indorsed the check or was present in the bank with Petty when the teller parted with the possession of the check, yet, after a careful review of the whole evidence relevant to this issue, particularly these features of evidence the signature as of appellee on the back of the check and on other original papers certified to this court-our opinion is that the clear preponderance of the evidence is to the effect that appellee did not himself receive the $3,000 check from the teller and did not himself indorse the $3,000 check. According to the effect of the evidence, the only check relating to this matter appellee received was one for $777.24, pay-guishing features of agency are representaable to appellee, signed by Petty individually, of date April 17, 1915, and marked (stamped) paid on April 20, 1915, bearing this nota- [5, 6] Where the evidence is in dispute, or tion, "For Mrs. Mary F. Thompson, loan in reasonable adverse inferences from evidence full." This check's amount represented the are deducible, the solution of the question difference, before mentioned, between the raises an issue of fact. 1 Mechem, § 300. sum of the loan, viz. $3,000, and the aggregate It appears from the evidence that Petty had of appellee's then indebtedness and the charg- been long in the habit of passing upon the es the appellee agreed to pay. Undoubtedly, security for loans of money belonging to Mrs. the amount of the Humes mortgage debt was Thompson, of viséing the title to lands profa factor in the calculation which gave the fered as security for loans of her money, of net difference represented by the check for collecting debts due her, and of entering upon $777.24. At the time Petty gave appellee this the margins of the records the satisfaction of check for $777.24, Petty also gave the mort- mortgages held by her. On August 1, 1912, gagor appellee the following writing, signed Mrs. Thompson executed a power of attorfor Mrs. Thompson, the mortgagee, by Petty,ney to Petty. The report of the appeal will

attorney:

"This is to certify that on the mortgage of George David Atchley to Mrs. Mary F. Thompson, amounting to $3,000, of date March 31, 1915, the prior mortgage of $1.500 and one year's interest, making a total of $1,620, is a part of the said $3,000. and is to be taken care of and to be paid by Mrs. Mary F. Thompson. this the 31st day of March, 1915. [Signed] Mrs. Mary F. Thompson, by Turner Petty, Atty."

About 15 months later Petty absconded. The mortgage held by Mrs. Humes was not paid, as the quoted writing assured it would be paid, out of the funds retained by Petty for the purpose. Subsequently, Mrs. Thompson caused the Humes mortgage to be transferred to her, and relies upon it as an outstanding obligation against appellant and a charge upon his lands. As appears, a vital question in the cause is whether Petty was Mrs. Thompson's agent or Atchley's agent in respect of the application of the money so retained to the discharge of the Humes mortgage debt, with the result to attend that, if Petty was Mrs. Thompson's agent in that particular, Atchley's only obligation under his mortgage to Mrs. Thompson was and is to repay the $3,000 and interest, whereupon Atchley was and is entitled to have the Humes mortgage canceled and surrendered

tive character and derivative authority. 1 Mechem on Agency (2d Ed.) § 26.

contain it. This instrument was recorded in the probate office of Madison county on August 15, 1912. It appears that even after the date of the execution of the mortgage here in question by appellee to appellant, Petty did an act that was within the purview of the authority conferred by this power of attorney.

"Powers of attorney are, ordinarily, subjected to a strict construction; or, rather, the authority given is not extended beyond the meaning of the terms in which it is expressed." Brantley v. Ins. Co., 53 Ala. 554, 557; 31 Cyc. p. 1407 et seq.

This instrument did not itself authorize or empower Petty to loan money for Mrs. Thompson without her consent, nor authorize or empower Petty to engage for Mrs. Thompson and to oblige her to discharge an obligation of her debtor to a third person out of funds derived from a loan made by Mrs. Thompson to such debtor. We are unable to see that this instrument had or has any bearing upon the main issue presented in this cause. If appellee read this instrument on the records of Madison county before he made the agreement whereby Petty was to retain of the $3,000 loan, the necessary amount to pay the Humes mortgage, he could not have acquired therefrom any infor

loan, and had property of a value adequately to secure the loan of a sum sufficient to discharge the přior incumbrance of Mrs. Humes' mortgage. Petty exacted the discharge of that incumbrance as a condition precedent to the effectuation of the loan to appellee. The existence of that prior incumbrance was an obvious obstacle to the clear title Mrs. Thompson required, and which she relied upon him (Petty) to see was afforded her through the security prepared by Petty. Her direction to the teller of the bank to deliver the check when the papers Petty had prepared were delivered to the teller furnishes unmistakable evidence of her complete re

Petty authority to engage as he (Petty) un- was manifestly inconsistent with the interdertook to do. est of the proposed borrower. [7, 8] But, aside from this instrument, it It appears with all certainty that the title seems from the whole evidence to be reason- Mrs. Thompson required was an unincumably certain that Mrs. Thompson had confer-bered title. Petty, of course, knew this and red on Petty authority to render services so advised appellee. Appellee wanted the for her in the lending of money which, while paid for by the borrower, were, in fact, of peculiar advantage to her. State v. Bristol Bank, 108 Ala. 3, 18 South. 533, 54 Am. St. Rep. 141. It is evident that she reposed confidence in Petty's professional judgment and discretion with respect to value of properties offered as security and to the title the borrower had thereto. There are, however, two circumstances related to this loan to appellee that, if considered alone, would require a different conclusion from that just above indicated. They are: (a) That Mrs. Thompson made the check payable direct to the borrower, not to Petty, and left it with the teller of her bank to be delivered when appel-liance upon Petty to guard and conserve her lee's duly executed note and mortgage were there presented; and (b) that the borrower, appellee, agreed to pay Petty for his services in effecting the loan. Both of these circumstances are but evidential in character and effect. They have been considered in connection with other evidence in the cause bearing upon the issues. Upon such consideration, our conclusion is that other evidence inception of the money loaned by appellant to the cause neutralizes the effect of these two circumstances, that would, if unimpaired in probative force by other evidence, require the conclusion that Petty was the agent of the borrower and not the lender.

interest-not that of the borrower to whose interest in respect of title her interest was undoubtedly opposed-in making the loan to appellee. So, when Petty and appellee agreed that Petty might retain an amount sufficient to discharge Mrs. Humes' prior incumbrance, he was providing in the most practical and certain way, through the inter

appellee, to assure appellant an unincumbered title under appellee's mortgage with appellant's authority to, and reliance upon, him (Petty) to see that she was afforded an unincumbered prime security. The fact that There was no stipulation that Petty was appellant did not (if so) at all compensate to be, or was, the borrower's agent, as was Petty for this service is, as stated, but an the case in several of the decisions noted on evidential circumstance insufficient in probathe brief for appellant. The source of this tive force to overcome countervailing eviborrower's compensation of Petty was predi- dence. Petty's compensation was provided cated of the effectuation of the loan, and not for, according to the custom, out of the very independent of its effectuation. Mrs. Thomp- subject of the loan, not through or in conseson had been in the habit, with perhaps oc- quence of appellee's agreement to compencasional variations, due to her inspection of sate Petty if the loan was not secured. Petproffered land securities to ascertain their ty was assured his fee if the loan was made, values, of lending on Petty's recommenda- and neither party became obligated to pay tion, where the values and titles were satis-him otherwise. The loan could not be made factory to Petty, the remaining condition unless an unincumbered title was assured, precedent thereto being that Mrs. Thompson and the existence of this condition Mrs. had funds at the time to make the loan. In Thompson committed to Petty to determine passing upon the title and value of proffered in her peculiar behalf. security Petty, in whom Mrs. Thompson re- [9] Hence we hold, as did the court below, posed the confidence and reliance indicated, on the evidence disclosed by the record, that, undoubtedly rendered service of peculiar ad- in engaging with appellee to retain from the vantage to Mrs. Thompson, though, of course, loaned sum an amount sufficient to discharge his approval in these respects of the security the prior incumbrance in favor of Mrs. ultimately inured to the benefit of the propos- Humes, Petty was the agent of Mrs. Thomped borrower. If Petty had purposely or neg-son, and the written assurance given by him ligently induced Mrs. Thompson to lay out to appellee was effective to then establish her funds on property the title to which was the relative rights of these parties and the bad, it is not reasonable to suppose that Pet-obligation of Mrs. Thompson to see that ty could have answered and defeated her ac- the Humes mortgage debt was discharged tion for damages on any theory that would through seasonable application of the money have negatived his relation of agency to retained by Petty, wherefrom it results that Mrs. Thompson as his principal, and so for Petty's infidelity is ascribable to his princithe evident reason that the fidelity to the pal, and entitled the appellee (complainant)