Huntington Nat. Bank v. Merrill Lynch

• Decision Date: 02 August 2000
• Docket Number: No. 2D98-4842.,2D98-4842.
• Parties: The HUNTINGTON NATIONAL BANK, Appellant, v. MERRILL LYNCH CREDIT CORPORATION, a Delaware corporation, Appellee.
• Court: Florida District Court of Appeals

779 So.2d 396

The HUNTINGTON NATIONAL BANK, Appellant, v. MERRILL LYNCH CREDIT CORPORATION, a Delaware corporation, Appellee.

No. 2D98-4842.

District Court of Appeal of Florida, Second District.

August 2, 2000.

Jeanette Martinez of Porter, Wright, Morris & Arthur, Naples, for Appellant.

Harold N. Hume, Jr. and Gerald W. Pierce of Henderson, Franklin, Starnes & Holt, P.A., Fort Myers, for Appellee.

NORTHCUTT, Judge.

This case involves a dispute between The Huntington National Bank and Merrill Lynch Credit Corporation over the priority of their mortgages on Diana Perkinson's property. We reverse a summary judgment dismissing with prejudice Huntingon's effort to reform and foreclose its mortgage.

The record on Merrill Lynch's motion for summary judgment comprised the pleadings and two affidavits by Huntington loan officers. These reflected that in February 1992 Perkinson gave Huntington a note evidencing a commercial draw loan in the amount of $1,518,000. The note provided that Perkinson would repay Huntington that sum "or so much thereof as shall have been advanced by the Bank at any time and not hereafter repaid." Further, the note stated that "[t]he obligations... may from time to time be evidenced by another note or notes given in substitution, renewal or extension hereof. Any security interest or mortgage which secures the obligations evidenced hereby shall remain in full force and effect notwithstanding any such substitution, renewal, or extension." Perkinson's loan application reflected that the loan was to be collateralized by a securities account, by real property in Ohio, and by the Lee County property at issue here.

In March 1992 Perkinson executed a $500,000 mortgage on the Lee County property in favor of Huntington. However, the printed portion of the form mortgage referred to a non-existent note of even date. Huntington's pleadings and affidavits asserted that this was a mistake, and that the mortgage was intended to secure the February 1992 commercial draw note. By its terms, the mortgage secured "the repayment of the debt evidenced by the Note ... and all renewals, extensions and modifications of the Note." It was recorded in July 1992.

By January 1997, payments and sales of collateral had reduced the balance owed on the commercial draw loan to $156,000. Perkinson gave Huntington a promissory note in that amount. Although no additional mortgage was given, this note stated that it was "secured by a mortgage on real estate located in Lee County, Florida." In its pleadings and affidavits Huntington characterized this note as a renewal of the February 1992 commercial draw note.

Meantime, in April 1994 Perkinson had executed two mortgages in the amounts of $850,000 and $150,000 encumbering the same Lee County property in favor of Merrill Lynch. In June 1998 Huntington filed a mortgage foreclosure action against Perkinson and all junior lienholders, including Merrill Lynch. Ultimately, Huntington filed a third amended complaint seeking to reform its mortgage to reflect that it secured the February...