Chap. 329.—An ACT to amend and re-enact Section 5167 of the Code of Virginia,
as amended, relating to deeds of trust. [S 201]

Approved March 29, 1944

Be it enacted by the General Assembly of Virginia :

1. That section fifty-one hundred sixty-seven of the Code of Vir-
ginia, as amended, be amended and re-enacted, as follows:

Section 5167. How such deed of trust construed and effect of certain
words therein; duties, rights and obligations of the parties and bene-
ficiaries ; duties of clerks upon recordation.—Every deed of trust to secure
debts or indemnify sureties, except so far as may be therein otherwise pro-
vided, shall be construed to impose and confer upon the parties thereto,
and the beneficiaries thereunder, the following duties, rights and obliga-
tions, in like manner as if the same were expressly provided for by such
deed of trust, namely:

(1) The deed shall be construed as given to secure the performance
of each of the covenants entered into by the grantor as well as the pay-
ment of the primary obligation.

(2) The grantor shall be deemed to covenant that he will pay all
taxes, levies, assessments and charges upon the property, including the
fees and charges of such agents or attorneys as the trustee may deem ad-
visable to employ at any time for the purpose of the trust, so long as any
obligation upon the grantor under the deed of trust remains undischarged.

(3) The grantor shall be deemed to covenant that he will keep the
improvements on the property in tenantable condition, whether such im-
provements were on the property when the deed of trust was given or
were thereafter placed thereon.

(4) The grantor shall be deemed to covenant that no waste shall be
committed or suffered upon the property.

(5) The grantor shall be deemed to covenant that in the event of his
failure to meet any obligations imposed upon him then the trustee of any
beneficiary may, at his option, satisfy the same; and the money so ad-
vanced with interest thereon shall be a part of the debt secured by the
deed, in the event of sale to be paid next after the expenses of executing
the trust, and shall be otherwise recoverable from the grantor as a debt.
(6) In the event of default in the payment of the debt secured, or
any part thereof, at maturity, or in the payment of interest when due, or
of the breach of any of the covenants entered into or imposed upon the
grantor, then at the request of any beneficiary the trustee shall forthwith
declare all the debts and obligations secured by the deed of trust at once
due and payable, shall take possession of the property and proceed to
sell the same at auction at the premises (or at such other place as the
trustee may select) upon such terms and conditions as the trustee may
deem best, after first advertising the time, place and terms of sale in such
manner as the deed may provide, or, if none be provided, after first adver-
tising the time, place and terms of sale once a week for four successive
weeks in a newspaper published or having general circulation in the
county, it not being intended, however, to declare that other and different
advertisement may not in any case be deemed reasonable, nor to prevent
the trustee from giving the sale such additional advertisement as he deems
advisable. No notice to the grantor or his successor in title shall be re-
quired unless required by the deed of trust.

(7) If the property is located in a city, or in a county in which a city
or a part thereof is located, publication of the advertisement five times in
a newspaper published in such city (the last insertion 1f desired on the
day of sale) shall be deemed adequate; it not being intended, however, to
declare that other and different advertisement may not.in any case be
deemed reasonable, nor to prevent the trustee from giving the sale such
additional advertisement as he may deem advisable.

(8) Ifthe deed of trust itself provides a method of advertising, which
may be done by using the words “advertisement required’, or words of
like purport, followed by the method agreed on, then no other or different
advertisement shall be necessary, beyond what the deed calls for, though
the trustees may, in his discretion, give further advertisement. |

(9) The trustee may postpone the sale at his discretion, in such
case giving such notice of advertisement of such postponement as he may
deem reasonable, without meaning to declare any other method unreason-
able, when the advertisement is by publication in a newspaper the con-
tinuation thereof in the subsequent issues of such newspaper with a note
of such adjournment appended shall be deemed adeqante in the absence
of contrary provision in the deed of trust.

(10) The trustee may require of any bidder at any sale a cash de-
posit of not exceeding one hundred dollars, (unless the deed of trust speci-
fies a different maximum, which may be done by the words, “bidder’s
deposit of not more than... . dollars may be required”, or words ot
like purport), before his bid is received, which shall be refunded to the
bidder unless the property is sold to him, otherwise to be applied to his
credit in settlement, or should he fail to complete his purchase promptly
to be applied to pay the costs and expenses of sale and the balance, if any,
to be retained by the trustee as his compensation in connection with that
sale, .
(11) If the sale be upon credit terms the deferred purchase monev
shall bear interest from the day of sale and shall be secured by a deed of
trust upon the property contemporaneous with the trustee’s deed to the
purchaser. The clerk of the court upon admitting to record the deed of
such trustee conveying property held in trust shall note a reference to
same on the margin of the deed book where the deed or other writing
conveying the property to such trustee in trust is recorded, if the same
can be found in his office.

(12) The trustee shall receive and receipt for the proceeds of sale,
no purchaser being required to see to the application of the proceeds,
and apply the same, first, to discharge the expenses of executing the trust,
including a commission to the trustee of five per centum of the gross pro-
ceeds of sale; secondly, to discharge all taxes, levies, and assessments,
with costs and interest, including the due pro-rata thereof for the current
year ; thirdly, to discharge in the order of their priority, if any, the remain-
ing debts and obligations secured by the deed, with lawful interest; and,
fourthly, the residue of the proceeds shall be paid to the grantor or his
assigns ; provided, however, that the trustee as to such residue shall not be
bound by any inheritance, devise, conveyance, assignment or lien of or
upon the grantor’s equity, without actual notice thereof prior to distribu-
tion.

(13) Upon discharge of all the debts, duties and obligations imposed
by the deed upon the grantor, including any expenses incurred pre-
paratory to sale, then upon the grantor’s request the trustee shall execute
and deliver a good and sufficient deed of release at the grantor’s own
proper costs and charges.

The following provisions may be incorporated in any such deed of
trust in the respective short forms indicated, namely: (a) The words
“identified by trustee’s signature”, or words of like purport, shall be con-
strued as if the deed set forth: ‘All of which said notes (or other obliga-
tions.) bear the marginal signature of the trustee for the purpose of identi-
fication but for no other purpose whatever.”

(b) The words “deferred purchase money”’, or words of like purport,
shall be construed as if the deed set forth: “This deed of trust is a con-
temporaneous purchase money deed of trust and secures the payment of
deferred purchase money due by the grantor upon the property hereby
conveyed.” |

(c) The words “exemptions waived”, or words of like purport,
shall be construed as if the deed set forth: “The grantor hereby waives
the benefit of his exemptions as to the debt hereby secured and as to all
other obligations which may be imposed upon him by the provisions of
this deed of trust.”

(d) The words “subject to all upon default”, or words of like pur-
port, shall be construed as if the deed set forth: “Should default be made
in the payment of any payment of any part of the debt hereby secured,
principal or interest, at the maturity of such part, or in the event of the
breach of any of the covenants entered into or imposed upon the grantor,
then the entire obligation of this deed of trust and the whole debt hereby
secured shall, at the option of the beneficiaries, become forthwith due and
payable.”
(e) The words “renewal or extension permitted”, or words of like
purport, shall be construed as if the deed set forth: ‘The grantor hereby
consents and agrees that the debt hereby secured, or any part thereof,
may be renewed or extended beyond maturity as often as may be desired
by agreement between the creditor and any subsequent owner of the prop-
erty, and no such renewal or extension shall in any way affect the
grantor’s responsibility, whether as surety or otherwise.”

({) The words “right of anticipation reserved”, or words of like
purport, shall be construed as if the deed set forth: “The grantor reserves
the right to anticipate the payment of the debt hereby secured, or any
part thereof which is represented by a separate note (or other obligation)
at any interest period by the payment of principal and interest to the date
of such anticipated payment only.”

(g) The words “priority in direct order of maturity”, or words of
like purport, shall be construed as if the deed set forth: “The notes (or
other obligations) hereby secured have priority amongst themselves in
the direct order of their maturities, each having priority over all others
falling due after its maturity.’”’ And the words, “priority in inverse order
of maturity’, or words of like purport, shall be construed as if the deed
set forth: “The notes (or other obligations) hereby secured have priority
amongst themselves in the inverse order of their maturities, each having
priority over all others falling due before its maturity.”

_ (h) The words “insurance required ............ dollars’’, or
words of similar purport, shall be construed as if the deed set forth: “The
grantor covenants that he will keep the improvements on the property
insured against fire in some solvent insurance company approved by the
trustee for the benefit of the beneficiaries hereunder in the sum of at least
eee eee dollars, and will deposit with the trustee the policies, with
standard loss payable clauses with full contribution in favor of the trustee
as his interest may appear; and the grantor further covenants that in the
event of his failure to keep the property so insured and the policies so
deposited, then the trustee or any beneficiary may, at his option, effect
such insurance and pay the premium thereon, and the money so paid,
with interest thereon, shall become a part of the debt hereby secured, in
the event of sale to be paid next after the expenses of executing this trust,
and shall be otherwise recoverable from the grantor as a debt, but there
shall be no obligation upon the trustee or beneficiary to effect such in-
surance,”