U.S. Fidelity & Guaranty Co. v. Bennett
| Decision Date | 22 December 1928 |
| Citation | 119 So. 394,96 Fla. 828 |
| Parties | UNITED STATES FIDELITY & GUARANTY CO. v. BENNETT et al. |
| Court | Florida Supreme Court |
Suit by the United States Fidelity & Guaranty Company against S. B Bennett and others. From an order sustaining in part a demurrer to the bill of complaint, plaintiff appeals.
Affirmed.
Syllabus by the Court
Right to subrogation depends on circumstances and equities of particular case. Doctrine of subrogation is a creature of courts of equity, having for its basis the doing of complete justice between parties without regard to form, and it will be applied or not according to dictates of equity, good conscience, and considerations of public policy, and will be allowed in all cases where equities of case demand it; right thereto depending on facts and circumstances of particular case.
Surety having paid obligee's notes secured by first chattel mortgage without intimating intention to claim subrogation held, second mortgage security became enhanced to that extent. Where surety on highway construction contractor's bond paid six of the seven notes executed by contractor and secured by first chattel mortgage, without any intimation to holder of second mortgage of intention to claim right of subrogation or to retain lien to secure repayment of notes so paid, held that second mortgage security become enhanced in value to extent of such payments, and such enhancement was a vested right in holder of second mortgage.
Appeal from Circuit Court, Franklin County; J. B. Johnson, judge.
Parker & Parker, of Tallahassee, for appellant.
R. Don McLeod, Jr., of Apalachicola, for appellees.
The appeal in this case is from an order sustaining in part a demurrer to a bill of complaint.
In short, the allegations of the bill of complaint are: That Bennett Construction Company contracted with the state road department of Florida to construct a certain road, and United States Fidelity & Guaranty Company made surety bond for the faithful performance of the contract. Bennett Construction Company failed to perform its contract, and the same was declared forfeited by the state road department, and the surety company was advised that it would be required to make good the conditions of its surety bond. Bennett Construction Company on the 11th day of November, 1926, is alleged to have been indebted to the First National Bank of Atmore, at Atmore, Ala., in the sum of $2,150, and, as evidence of such indebtedness, did make and deliver to the said bank its certain promissory notes, one due February 1, one due March 1, one due April 1, one due May 1, one due June 1, and one due July 1, all in 1927, for the sum of $300 each, and one due August 1, 1927, for $350, and, to secure the payment of these notes, executed a mortgage on certain mules and horses and some other equipment, and thereafter Bennett Construction Company, being indebted to Dothan National Bank of Dothan, Ala., made a second mortgage creating a lien on a part of the same property described in the first mortgage. That the contract was made with the state road department on the 14th day of August, 1926, and that the surety company executed the bond on that date to guarantee the faithful performance of the contract by the Bennett Construction Company. That on the 29th day of January, 1927, the state road department notified the surety company that the contract had been declared forfeited so far as the Bennett Construction Company was concerned, and thereupon the surety company undertook to complete the contract. The agreement of indemnity contained the following clause:
'That for the better protection of the said Company, and as of the date thereof, the said Principal does hereby assign, transfer and convey to the said Company, all right, title and interest in and to all the tools, plant equipment and materials of every nature and description that said Principal may now or hereafter have upon said work, or in or about the site thereof, including as well materials purchased for or chargeable to said contract, which might be in process of construction or storage elsewhere, or in transportation to said site, hereby assigning and conveying also all rights in and to all subcontracts, which have been, or may hereafter be entered into, and the materials embraced therein, and authorizing and empowering said Company, its authorized agents or attorneys, to enter upon and take possession of such tools, plant equipment, materials and subcontracts, and enforce, use and enjoy such possession upon the following conditions, viz: This assignment shall be in full force and effect as...
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...of equitable subrogation depends upon the facts and circumstances of each case, United States Fidelity & Guaranty Co. v. Bennett , 96 Fla. 828, 119 So. 394, ‘having for its basis the doing of complete and perfect justice between the parties without regard to form,’ Dantzler Lumber & Export ......