Johnson v. Smith
| Decision Date | 11 January 1956 |
| Citation | 84 So.2d 722 |
| Parties | E. Dana JOHNSON, Appellant, v. Sophia A. SMITH, Appellee. |
| Court | Florida Supreme Court |
W. D. Jobe and James H. Bunch, Jacksonville, for appellant.
Coffee & Coffee, Jacksonville, for appellee.
Appellant Johnson, who was defendant below, seeks reversal of a judgment against him in an action founded upon an alleged promissory note.
By her complaint appellee alleged that appellant Johnson and another executed and delivered to plaintiff a promissory note in the sum of $7,000 due thirty-six months after date, which said note provided that if at any time the collateral pledged as security therefor should become unsatisfactory to the holder, then the makers would immediately furnish such additional security as would be satisfactory. The complaint further alleges that the collateral became unsatisfactory, that demand was made on the makers to improve the security and that upon their failure to do so, the appellee exercised the rights given to her by the instrument to declare the entire unpaid balance due. It is further alleged that pursuant to an agreement coincident with the execution and delivery of the note, but not incorporated in the note itself, the makers 'pledged to the plaintiff as security for the payment thereof that certain certificate for 726 shares of the capital stock of Southern Insurance, Inc. of the par value of ten dollars for each share, the same being certificate number 406'.
Further, it was alleged that subsequent to the execution of the note the makers agreed to make monthly payments of $100 each against the principal due, although this is not contained in the note itself.
After a motion to dismiss the complaint as amended was denied, the appellant Johnson filed several defenses by an amended answer. The first defense was a denial 'that the note sued upon was ever delivered by the makers thereof to the plaintiff'. By his third defense, appellant attempted to allege nondelivery of the note to the plaintiff and to set up an escrow arrangement described in a letter which he made a part of the answer. This letter reads as follows:
'Mrs. Sophia A. Smith
'170 Lindbergh Drive, N. E.
'Atlanta, Ga.
'Dear Mrs. Smith:
'This is to acknowledge to you receipt of stock certificate #406 of Southern Insurance, Inc, representing 726 shares of the capital stock of said Company, said stock to be held in escrow for delivery to Dan Y. Sage, Jr., and E. Dana Johnson but to be delivered to them only after payment by them of seven thousand dollars.
'We further acknowledge receipt of assignement from E. Dana Johnson of $100.00 per month, to be withheld from his earnings with the Company each month until $3,500.00 has been paid to you, at the rate of $100.00 per month and we acknowledge receipt of an assignment of $100.00 per month from Dan Y. Sage, Jr. to be withheld from his salary and earnings from the Company to be paid to you each month until the sum of $3,500.00 has been paid.
'We further acknowledge receipt of a promissory note secured by said stock in the sum of $7,000.00 signed by Dan Y. Sage, Jr., and E. Dana Johnson, to which notes the sums assigned as above provided are to be applied, in the total monthly amount of $200.00 per month for a period of thirty-five (35) months beginning April 1st, 1952, and upon final payment, either at, before or after maturity of the last installment payment said stock and stock transfer shall be delivered to Dan Y. Sage, Jr. and E. Dana Johnson or to their order.
'Very truly yours,
'Southern Fire and Marine Insurance Company
'(signed) J. R. Smith
'Vict President
'This escrow agreement approved and accepted this 8th day of March, 1952.
'(signed) Sophia A. Smith
'c/o Mrs. Thomas Morris
'170 Lindbergh Dr., N. E.'
The answer then alleges that the escrow agent wrongfully delivered the note and stock certificate to the plaintiff, that after this particular defendant had paid $1700.00 on the note, the corporation, Southern Insurance, Inc. went out of business, that the stock became worthless and that the stock certificate had never been received by appellant and prior to the action had been turned over to the appellee along with the note. The tendered defenses were stricken on the motion of the appellee and the appellant elected to stand on his defenses and declined to plead further.
The trial judge thereupon entered a default judgment against him and a final judgment ensued upon the default for the balance due on the note.
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