WPC .# U: % 0(b w@4Sgv 0J~ 0T 0^ 0hz 0r 0|T 0 0V 1u 0d[U *B) AQ c 0D) 0@m 0D DC D/4 Bc B D3 AM  v~. vHP LaserJet 4SiHPPCL5MS,,,,,,0nLh,  AZ"Arial RegularX($- - DDDDӀ_#xx3|x2 0Indent123  2" 0Indent20 23  2, 0Indent30 0 23  26 0Indent40 0 0 23  2@ 0Indent50 0 0 0 23  2J 0Indent60 0 0 0 0 23  2T 0Indent70 0 0 0 0 0 23  2^ 0Indent80 0 0 0 0 0 0 23   ?AGMSYaioIndent0I.A.1.a.(1)(a)i)a)P 8Mac DefaultMac Default ` X<  9p`(Arial% Line 7 d!"#$&C<< CLevel 1Level 2Level 3Level 4Level 5(3$ !  ("$    ($$   1  7Border 1dd((' dxd dP Pd'''''dxd!#%C << G  !  #d#  ""     YYY FILEDXJuly1,1998CecilW.CrowsonAppellateCourtClerk  PtPtHH(FG(HH(d'hStyl{WP}01  HH  2$HH  Geneva  <Px443!#4$*$$*$ KK  Geneva  Geneva .,6 Geneva   ellan Geneva  ellan Geneva ! .       \RA'\7XXdd7      ӛ @ INTHECOURTOFAPPEALSOFTENNESSEE!ٜR*+%A1-j|`  `@Rߛ@ ATNASHVILLE XCHARLESF.GAULDEN,andWife, )RUTHS.GAULDEN,   )      ) Plaintiffs/Appellants,  )      ) AppealNo.      ) 01A019708CH00417VS.      )      ) DavidsonChancery      ) No.953970IIIROBERTL.SCRUGGS,andWife, )      JOYCEW.SCRUGGS,   )      ) Defendants/Appellees.  )@ APPEALEDFROMTHECHANCERYCOURTOFDAVIDSONCOUNTY@ ATNASHVILLE,TENNESSEE@ THEHONORABLEELLENHOBBSLYLE,CHANCELLORROBERTA.ANDERSON2021RichardJonesRoad,Suite350Nashville,Tennessee37215 AttorneyforPlaintiffs/AppellantsNADERBAYDOUNJOHNI.HARRISIIISuite2420,NashvilleCityCenter511UnionStreetNashville,Tennessee37219 AttorneysforDefendants/Appellees@ AFFIRMEDANDREMANDED       BENH.CANTRELL,JUDGECONCUR:TODD,P.J.,M.S.BUSSART,S.J. @ OPINION X  Thequestioninthiscaseiswhetherapurchaserofmortgagedproperty,whopaysoffthemortgage,takesanassignmentofthenoteanddeedoftrust,andsubsequentlyreleasesthedeedoftrust,canthensuetheoriginalmortgageeonthenote.TheChanceryCourtofDavidsonCountydismissedtheaction.Weaffirm.@ I.   In1988thedefendants,Mr.andMrs.Scruggs,purchasedthreeparcelsofproperty,oneparcelfromtheplaintiffs,Mr.andMrs.Gaulden.Thepurchasepricewas$500,000andthesellersagreedtohelpwiththefinancingbytakingadownpaymentof$125,000andadeedoftrusttosecurepaymentofthebalance.TheyalsoagreedwiththeScruggstosubordinatetheirsecuritytoafirstmortgagegiventoUnionPlantersBank.The$225,000loanfromUnionPlanterswasusedinparttomakethedownpaymenttothesellers.  In1989whentheGauldensandtheothersellersthreatenedtoforeclosetheirdeedsoftrust,thepartiesworkedoutanagreementwherebytheϜScruggswouldtransferthepropertybacktothesellersinfullsatisfactionofthesecondmortgage.TheScruggssignedquitclaimdeedstransferringthepropertytotheoriginalsellers.Thus,atthatpointtheoriginalsellerswerepurchasersofthepropertysubjecttoafirstmortgagetoUnionPlantersBank.  TheGauldensthenpurchasedthe$225,000notefromUnionPlantersandtookanassignmentofthefirstmortgagedeedoftrust.Theyimmediatelyreleasedthepropertytheyoriginallyownedfromthemortgageandsoldthepropertyfor$333,330.Theydidnotcreditthenotewithanyoftheproceeds.  Fiveyearslater,theGauldensreleasedtheotherpropertycoveredbythemortgagesothattheownercouldsellit.Again,theydidnotgiveanycredittothefirstmortgagenote.@ II.   Thechancellorheldthat themergerdoctrineappliesandthatthefirstmortgageindebtednesswasextinguishedbytheplaintiffspurchaseofthefirstmortgagenoteanddeedoftrustatatimewhentheywerealsotheownersofrealpropertywhichsecuredthesameindebtedness.Wearesatisfiedthattheresultwascorrect,butwearenotsurethatitshouldbebasedonthemergerprinciple.Ourhesitationstemsfromthelineofauthoritythatholdsamergerdoesnotnecessarilyoccurwherethegranteeofthemortgagedpremisesmerelytakessubjecttothemortgageanddoesnotassumeit.See55Am.Jur.2dMortgages1404.  Itisclear,however,thatwhereagranteeofmortgagedpropertytakessubjecttothemortgage,thelanditself ischargedwiththemortgagetothesameeffectasthoughthepurchaserhadexpresslyassumedthepaymentofthedebtorhadhimselfmadeamortgageonthelandtosecureit,andthepurchasermustpaythesumdue,inequity,onthemortgageifhewishestorelievethelandfromtheencumbrance.59C.J.S.Mortgages390.SeeSandersv.Lackey,439S.W.2d610(Tenn.App.1969).SincetheGauldensdidnotexpressly(orbyimplication)assumethedebt,theyarenotpersonallyliableforit,andcouldnothavebeensuedonitbythebank;butthey,inequity,agreedthatthelanditselfwasprimarilyresponsibleforthepaymentofthemortgage.̛  Thechancellorheldthat8 8 [T]hedefendants,byquitclaimingrealpropertysubjecttothefirstmortgageindebtednesstotheplaintiffs,obtainedthelegalandequitablerighttoforcetheplaintiffs,asthevendeesofthatproperty,toapplytheproceedsfromanysubsequentsaleofthequitclaimedpropertytothesatisfactionorreductionofthefirstmortgageindebtedness.TheCourtfindsthattheplaintiffshavesoldthequitclaimedpropertyforconsiderationinexcessoftheamountofthefirstmortgageindebtednessandthatthedefendantsthereforehavetherighttoenforcethecompletesatisfactionofthefirstmortgageindebtednessoutofthosesalesproceeds.  WethinkthatisacorrectviewoftherelativerightsoftheGauldensandtheScruggsaftertheGauldenstookthepropertybacksubjecttothemortgage.  ThejudgmentofthetrialcourtisaffirmedandthecauseisremandedtotheChanceryCourtofDavidsonCountyforanyfurtherproceedingsnecessary.Taxthecostsonappealtotheappellants.         ____________________________       BENH.CANTRELL,JUDGECONCUR:__________________________________HENRYF.TODD,PRESIDINGJUDGEMIDDLESECTION__________________________________WALTERW.BUSSART,SPECIALJUDGE    X  @