Geyer v. First Arkansas Development Finance Corp.
| Decision Date | 25 November 1968 |
| Docket Number | No. 5--4764,5--4764 |
| Citation | 245 Ark. 694,434 S.W.2d 301 |
| Parties | , 5 UCC Rep.Serv. 1083 John M. GEYER, Jr., et ux., Appellants, v. FIRST ARKANSAS DEVELOPMENT FINANCE CORPORATION; and Southwest Factoring Corporation, Appellees. |
| Court | Arkansas Supreme Court |
W. Tiller Adamson, Little Rock, for appellants.
Rose, Meek, House, Barron, Nash & Williamson, and Warren & Bullion, Little Rock, for appellees.
This is an appeal from a chancery decree involving two foreclosures. The material facts summarized below are not in dispute.
John M. Geyer, Jr. and his wife (appellants here), on February 19, 1963, executed their note for $60,000 to First Arkansas Development Finance Corporation (an appellee here, and referred to as Corporation). The note was secured by a first mortgage on certain real estate, and also by a security agreement on personal property--all belonging to appellants. Later, appellants executed their note to Southwest Factoring Corporation (an appellee and referred to as Factoring Co.) in the sum of $51,910.25, which was secured by a second mortgage lien on the land included in the first mortgage mentioned previously.
On April 18, 1967, after the above mentioned note became delinquent, Corporation filed suit for judgment for balance due, and for foreclosure of its mortgage, naming appellants and Factoring Co. defendants. Factoring Co. asserted its right to judgment and a foreclosure. Appellants admitted, in their answer, the execution of said notes and securities, but denied they were liable to pay any attorney's fees. By way of cross-complaint appellants alleged Corporation required them (as a prerequisite to the loan) to purchase one of its debentures, in the sum of $3,000, due in fifty years, without interest--asking that the $3,000 be allowed as a credit on their note. note was usurious. (Other parties were made was usurious. (Other parties were made defendants in the suit but they are not involved on appeal).
After hearing testimony on the issues raised, the trial court entered a Decree, holding, in material parts:
(1) Corporation entitled to judgment against appellants for balance due in the amount of $44,554.93 and interest; for $1407.70--money paid on taxes, and; for $2000 as attorney fees.
(2) Denied appellants credit for the $3000 debenture.
(3) Gave Factoring Co. judgment against appellants in the sum of $60,475.45 and interest on the note, and $2000 for attorney fees, and also held said note was not usurious.
(4) Ordered a foreclosure and sale of the securities, and retained jurisdiction for certain specified purposes.
On appeal, appellants rely, for a reversal, on the separate points, which we now examine in order named.
One. It is contended here by appellants that the trial court erred in charging them with an attorney's fee, citing Ark.Stat.Ann. § 68--910 (Repl.1957), which reads:
'A provision in a promissory note for the payment of reasonable attorneys' fees, not to exceed ten per cent (10%) of the amount of principal due, plus accrued interest, for services actually rendered in accordance with its terms is enforceable as a contract of indemnity.' (Emphasis supplied.)
It is then pointed out by appellants that the notes here in question contain no such provision.
We are unable to agree with appellants' contention. Appellants are correct in stating there is no such provision in the note, but there is language in the note and mortgage which, we think, justified the court's action. The note contains this language:
'All the terms, covenants, conditions, provisions, stipulations, and agreements in said Deed to Trust and in said Security Agreement contained are hereby made a part hereof to the same extent and with the same effect as if the same were fully set forth herein.'
In the Twelfth paragraph of the Deed of Trust there appears the following language:
'It is furthermore agreed that said party of the first part (appellant) will pay to parties of the second and third parts, any and all sums, including costs, expenses and reasonable attorney's fees which they may incur * * *.'
In W. T. Rawleigh Co. v. Wilkes, 197 Ark. 6, p. 9, 121 S.W.2d 886, p. 888, this Court said:
'The general rule is that in the absence of anything to indicate a contrary intention, instruments executed at the same time, by the same parties, for the same purpose, and in the course of the same transaction, are, in the eye of the law, one instrument, and will be read and construed together as if they were as much one in form as they are in substance.'
See also Ark.Stat.Ann. § 85--3--119 (1961 add.) which, in material part, reads:
'As between the obligor and his immediate obligee *...
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