Gus' Baths, Inc. v. Lightbown

• Decision Date: 23 March 1931
• Citation: 101 Fla. 1205,133 So. 85
• Parties: GUS' BATHS, Inc. v. LIGHTBOWN et al.
• Court: Florida Supreme Court

133 So. 85

101 Fla. 1205

GUS' BATHS, Inc. v. LIGHTBOWN et al.

Florida Supreme Court

March 23, 1931

Commissioners' Decision.

Suit by Ella Murray Lightbown, joined by her husband, Cooper C Lightbown, against Gus' Baths, Inc. From a final decree foreclosing a mortgage, defendant appeals.

Affirmed.

Syllabus by the Court.

SYLLABUS

If an installment payment be accepted of past-due semiannual interest on mortgage notes not yet due, the general rule is that, in the absence of any understanding otherwise, it would have the effect of waiver of the option to accelerate the whole debt.

The fact that an option is not exercised to foreclose upon any previous default in payment of installments does not prevent a foreclosure for an unconditional subsequent default, as such indulgence cannot affect a right not yet accrued.

Any 'understanding' with persons other than the mortgagor, whereby a mortgagee accepts delinquent payments upon a mortgage subject to acceleration, may not be binding upon mortgagor as against an implied waiver.

Under an acceleration clause, if a mortgagee does not elect within a reasonable time after default to declare the whole of the principal due, he will be deemed to have waived such right especially where such delay operated to the advantage of the mortgagee or to the detriment of the mortgagor.

The master's findings of facts approved by the chancellor will not be disturbed unless clearly erroneous.

Appeal from Circuit Court, Palm Beach County; C. E Chillingworth, judge.

COUNSEL

Baynes & Rowe, of West Palm Beach, for appellant.

Bussey, Johnston & Lilienthal, of West Palm Beach, for appellees.

OPINION

ANDREWS C.

This appeal is from a final decree foreclosing a third mortgage on certain property in Palm Beach in the principal sum of $35,000, securing a note of the same amount, both dated October 24, 1924, payable five years from date, with interest at the rate of 10 per cent. payable semiannually. The mortgage provided for acceleration of the payments of the principal and all interest at option of mortgagee in the event the mortgagor defaulted for a period of thirty days in the payment of any semiannual interest payment. The bill of foreclosure was filed February 21, 1928, and the only breach relied upon as constituting ground of foreclosure was the default in making the demiannual interest payment falling due October 24, 1927.

The defendant claims a waiver of mortgagee's right to exercise the option contained in the mortgage to accelerate the payments in that, after several previous defaults to pay interest on the date stipulated, mortgagee accepted from mortgagor such interest payments without protest, and that complainant, by accepting several past-due interest payments in installments, including interest on past-due interest, and by her previous conduct toward defendant in delaying to exercise her option, such delay operated thus to her advantage, in that defendant by reason thereof made several costly repairs and additions to its public baths located on said property after such interest payments were in default, all with full knowledge of complainants; that ultimately such delay resulted to the detriment of defendant, and complainant should thereby be estopped and adjudged to have waived her right to exercise her option to foreclose because of the delay in payment of the semiannual interest due October 24, 1927.

The main defense seems to be based upon the contention that a certain check in the sum of $500, which defendant claims to have drawn on February 20, 1928, and mailed to complainant in part payment of the interest due October 24, 1927, was received and accepted. This check of $500, if received and accepted by complainant, would have necessarily constituted part payment on the interest installment of $1,750 maturing October 24, 1927, which is the installment in controversy in this suit, and under such circumstances the general rule is that it would have had the effect of waiver of the right to accelerate by reason of any default in payment of the semiannual interest due October 24, 1927. 2 Jones on Mortgages (8th Ed.) § 1518. It developed that this check was 'certified' by the bank upon which it was drawn, but apparently at the instance of some unidentified party. The 'slip' showing such certification by the bank was among defendant's canceled checks, and that amount was charged to the account of defendant. It is admitted, however, that no such check was ever cashed or returned to the bank as paid. The complainant testified, as did her husband, that they never received said check nor caused this or any similar check to be certified at said bank or anywhere else, nor ever did any business at the bank upon which the check was drawn.

It is not disputed that a check of $500, dated February 20, 1928 was certified at the Citizens' Bank of West Palm Beach on February 24, 1928; that complainant had no account at that bank; that the check was not cashed, nor has it been located since the alleged certification at the bank. Both the defendant and the bank gave testimony that no such canceled check was in their custody.

If it could be determined from the testimony as to who caused the check to be certified, it might solve the other controversies. It cannot be assumed that, because defendant on February 16, 1928, wrote Mrs. Lightbown that it expected to mail certain checks mentioned in said letter, including the one in dispute, and that all of those listed were returned by complainant's solicitors by letter of February...