First Sav. and Loan Ass'n of Cent. Indiana v. Treaster
Decision Date | 07 April 1986 |
Docket Number | No. 1-285A47,1-285A47 |
Citation | 490 N.E.2d 1149 |
Parties | FIRST SAVINGS AND LOAN ASSOCIATION OF CENTRAL INDIANA, Plaintiff-Appellant, v. Carol C. TREASTER, Wince Covher, Pearl Covher, James F. Pesicka, Kon Pesicka, Greenfield Banking Company, Carpenter Better Homes and Gardens, John Wolfe, and Lawrence M. Lunn, Defendants-Appellees. |
Court | Indiana Appellate Court |
James E. Freeman, Jr., Jonathan R. Builta, Sansberry, Dickmann, Freeman & Builta, Anderson, for plaintiff-appellant.
Ronald R. Pritzke, Briane M. House, Lineback, Lewis, Pritzke & Davis, Greenfield, for defendants-appellees.
STATEMENT OF THE CASE
First Savings and Loan Association of Central Indiana appeals the trial court's denial of its motion for summary judgment and the granting of summary judgment in favor of Carol C. Treaster, et al. upon its determination that a clause contained in the mortgage executed between the two parties was an assumption clause which was not violated. We affirm.
On December 14, 1976, Carol C. Treaster (Treaster), along with her parents Wince and Pearl Covher (the Covhers), executed a promissory note and real estate mortgage in favor of First Savings and Loan of Central Indiana (First Savings) to purchase a home for Treaster. The note and mortgage were signed to secure a loan of $29,700.00. The mortgage agreement, prepared by one of First Savings' attorneys, contained a clause which provided:
Record at 14. The Covhers executed a quitclaim deed giving their interest to Treaster on June 6, 1980. On April 7, 1981, Treaster listed the premises for sale with Century 21 Accent Realty.
On September 4, 1981, Treaster entered into three agreements with James and Kon Pesicka (the Pesickas) consisting of a residential lease, real estate mortgage, and purchase agreement for the premises. The lease was to run for three years from September 4, 1981, with a security payment of $5,000.00. The lease required Treaster to give the Pesickas a mortgage to secure repayment of the security payment. The lease further provided for rental payments, commencing October 1, 1981, of $525.00 per month and provided Treaster with the Upon learning of these agreements, First Savings brought suit alleging the lease/purchase agreement constituted a sale and that the parties were attempting to circumvent what First Savings asserted was a due on sale clause found in First Savings' mortgage. First Savings, therefore, sought recovery on the promissory note and foreclosure of the real estate mortgage as well as a declaratory judgment that due on sales clauses are valid in Indiana. Cross motions for summary judgment were filed, and on November 6, 1984, the trial court ruled in favor of Treaster. The court found that the quitclaim deed from the Covhers to Treaster and execution by Treaster of the lease/purchase agreement and mortgage on September 4, 1981, did not constitute a sale or transfer of the mortgaged real estate, an assumption of the mortgage or a relinquishment of title or the essentials of ownership within the meaning of the note and mortgage executed by Treaster and First Savings and, therefore, did not constitute default. Holding that the terms of First Savings note and mortgage called for payment in full only upon sale or transfer wherein the purchaser assumed the mortgage, the court found First Savings was not entitled to declare the note immediately due or seek foreclosure. Thereafter, First Savings perfected this appeal.
right to retake the premises should the Pesickas fall behind in their rent payments. In addition, the Pesickas were required to pay the taxes and insurance and make any necessary repairs not covered by the insurance. The purchase agreement obligated the Pesickas to purchase the premises for $57,000.00, on or before September 4, 1983, with the warranty deed held in escrow until closing.
There are essentially three issues argued on appeal:
1. Whether the trial court erred in finding that the clause contained in First Savings' real estate mortgage was a due on assumption clause and not a general due on sale clause.
2. Whether the transaction between Treaster and the Pesickas was a sale.
3. Whether the trial court erred in granting Treasters' motion for summary judgment. However, our resolution of one of these issues is dispositive of this appeal.
Before considering the key issue of this appeal, we note the standard of review, on appeal, applicable in a summary judgment is the same one used in the trial court. A motion for summary judgment may be sustained only where the pleadings and other matters filed with the court reveal no genuine issue as to any material fact, and the moving party is entitled to judgment as a matter of law. Indiana Rules of Procedure, Trial Rule 56(C); Kidd v. Davis (1985), Ind.App., 485 N.E.2d 156; Wingenroth v. American States Insurance (1983), Ind.App., 455 N.E.2d 968; English Coal Co., Inc. v. Durcholz (1981), Ind.App., 422 N.E.2d 302, trans. denied; First Federal Savings and Loan Ass'n. of Gary v. Arena (1980), Ind.App., 406 N.E.2d 1279. In determining whether a genuine issue of material fact exists, the facts set forth by the opponent must be taken as true, and all doubts are resolved against the proponent of the motion. First Federal, at 1282. With this standard in mind, we turn to the central issue in this dispute.
Generally, the intent of the parties is the controlling factor in determining what their agreement actually was. Peoples Federal Saving's and Loan Ass'n. of East Chicago v. Willsey (1984), Ind.App., 466 N.E.2d 470, 472. Where a written contract is involved, the court will determine this intent as disclosed by the language used to express their rights and duties. Ethyl Corp. v. Forcum-Lannom Associates, Inc. (1982), Ind.App., 433 N.E.2d 1214, 1217, trans. denied; Rieth-Riley Constr. Co., Inc. v. Auto-Owners Mutual Insurance Co. (1980), Ind.App., 408 N.E.2d 640, 645, trans. denied. In the absence of ambiguity, it is not within the function of the court to look outside the instrument to arrive at the parties' intent. Hence, Indiana applies...
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