Kreiss Potassium Phosphate Co. v. Knight
| Citation | 98 Fla. 1004,124 So. 751 |
| Parties | KREISS POTASSIUM PHOSPHATE CO. et al. v. KNIGHT. |
| Decision Date | 22 November 1929 |
| Court | United States State Supreme Court of Florida |
Commissioners' Decision.
Suit by C. L. Knight against the Kreiss Potassium Phosphate Company and others. From an adverse decree, defendants appeal. Reversed and remanded conditionally with directions.
Syllabus by the Court
Before decree pro confesso should be set aside on motion, mover must show both reasonable diligence and meritorious defense. Before a decree pro confesso properly entered should be set aside on motion of defendant, the mover must not only show reasonable diligence, but also a meritorious defense. A showing of reasonable diligence without meritorious defense or a meritorious defense without reasonable diligence, is unavailing.
Question of setting aside decree pro confesso is addressed to court's sound discretion; decree pro confesso should not be set aside on defendant's motion, where it is result of defendant's own negligence; exercise of discretion on question of setting aside decree pro confesso will not be disturbed on appeal except for gross abuse of discretion. The question of setting aside a decree pro confesso is addressed to the sound discretion of the court, which will be exercised according to the circumstances of each case; but it should not be set aside where it is the consequence of the defendant's own negligence, and the exercise of this discretion will not be interfered with by appellate court unless there has been a gross abuse of that discretion.
Some negligence on part of reasonably diligent applicant does not always justify refusal to open up decrees pro confesso if applicant has been reasonably diligent. The courts will not always be justified in refusing to open up decrees pro confesso, where there has been some negligence on the part of the applicant. Reasonable diligence is all that is required provided, of course, a meritorious defense is shown.
Chancellor should have exercised discretion to set aside decree pro confesso and permit defendants to affix corporate seals to and refile, answer if it contained meritorious defense. Under the circumstances of this case, we are persuaded to believe that the chancellor should have exercised his discretion in opening up and setting aside the decree pro confesso, and permitting the defendants to affix the corporate seals to, and refile the answer, if it contained a meritorious defense.
If mortgagee declares whole debt due for default in payment, mortgagor may tender past-due payments and by keeping tender good defeat mortgagee's right to declare unmatured payments due; mortgage cannot in own mind determine to accelerate mortgage for mortgagor's default, but must communicate decision to mortgagor or manifest election by outward act. Until the holder of notes secured by a mortgage which contains a provision that if default be made in the payment of any sum of money as therein provided, it shall be optional with him to consider the whole indebtedness due and payable, exercises the option, though there are payments past-due, the payor has the right to make a tender of such payments, and if a proper tender is made and kept good, the right of the mortgagee to declare unmatured payments due and payable is defeated. The mortgagee cannot just in his own mind determine to exercise the option and make it effective. He must either communicate his decision to the payor or manifest his election by some outward act.
Pleading of tender as defense must show production of money to be paid, offer thereof, subsequent readiness to pay, and payment thereof into court; mere offer to pay is not 'tender.' A pleading setting up tender of payment in money as a defense to a suit, to be good, must show a production of the money to be paid and offer of it to the person to whom it should go, and that the debtor has ever since been ready to pay, and must be accompanied by a payment of the money into the court. A mere offer to pay is not a tender of money.
Institution of foreclosure suit is exercise of mortgagee's option to declare whole principal sum and interest due. The institution of a suit for foreclosure is the exercise of the option of the mortgagee to declare the whole of the principal sum and interest secured by the mortgage due and payable.
Mere agreement for delay for no definite time and without consideration is unenforceable. A mere agreement for delay for no definite time and without consideration is not enforceable.
Waiver of right to enforce acceleration clause of mortgage does not arise from forehearance for reasonable time; waiver may be inferred from mortgagee's passive acquiescence, knowledge of sale in violation of condition, acts putting debtor off his guard, or from neglect to perform binding conditions; waiver of right to enforce acceleration clause does not arise generally from loose declaration which mortgagee is under no obligations to make and on which no one relies to his prejudice. Waiver does not arise from forebearance for a reasonable time, but may be inferred from the mortgagee's passive acquiescence from his knowedge of the sale of the property in violation of a condition, without making objection, from acts putting the debtor off his guard and leading him to believe that the right has been waived, or from his neglect to perform conditions binding on him, and on which his right to take advantage of the default is predicated; but not generally from loose declarations which he is under no obligations to make and on which no person relies to his prejudice.
Mortgagee inducing others to believe and act on belief that he will not enforce mortgage may be estopped, as to them, from so doing. A mortgagee may by his conduct, inducing others to believe and act upon the belief that he will not enforce his mortgage, be estopped as to them from so doing.
Mortgagee held to have reasonable time after default in which to elect to declare whole principal due under acceleration clause; mortgagee failing within reasonable time after default to elect to declare whole principal due under acceleration clause will be deemed to have waived right. Under an acceleration clause like the one in the instant case, the mortgagee has a reasonable time after default in which to elect to declare the whole of the principal sum due, and if he does not so elect within a reasonable time, he will be deemed to have waived his right to exercise his option.
Mortgagee's failure to foreclose mortgage on first default in payment thereunder or in payment of taxes does not prevent foreclosure for subsequent default. It is a general rule that the fact that a mortgage is not foreclosed on the first default in payment does not prevent a foreclosure for a subsequent default, since such indulgence cannot affect a right not yet accrued. This principal applies with equal force to the nonpayment of taxes.
Mortgagee's conduct and value of mortgaged property in proportion to mortgage debt held to render it inequitable to accelerate principal debt without opportunity to make payments. A court of equity is a forum for the administration of right and justice, and in view of the circumstanced disclosed by the record in this case, held, that it would not be right or just to permit the complainant to accelerate the maturity of the notes given for the principal sum without giving the defendants an opportunity to pay the amounts which they were in duty bound to pay under the contract if no default had occurred.
Appeal from Circuit Court, Hillsborough County; F. M. robles, judge.
Treadwell & Treadwell, of Arcadia, for appellants.
Jackson, Dupree & Cone, of Tampa, for appellee.
In this case the appellee on May 22, 1928, filed a bill of complaint for the foreclosure of a mortgage. On July 2, 1928, the appellants (defendants in the lower court) filed what purported to be their joint and several answer to the bill; the corporate seals of the defendants not being affixed thereto. On July 12, 1928, complainant filed a motion for the entry of a decree pro confesso against the defendants because of the failure of the defendants to plead, answer, or demur to the bill on the rule day in July, 1928. Upon the same day the said motion was heard by the court, and it was ordered, adjudged, and decreed that the said paper was null and void and not an answer, 'in that it was not under seal of either or both of said corporations,' and further 'that a decree pro confesso be and the same is hereby entered against the said defendant, Kreiss Potassium Phosphate Company, a corporation, and Tampa Tidewater Terminal, Inc., a corporation.'
On the 20th day of July, 1928, or eight days after the making of the order entering the decree pro confesso, the defendants filed a motion for the court to 'open up and set aside the decree pro confesso,' reciting therein, in substance, that they had an absolute defense as against the mortgage sought to be foreclosed in said bill of complaint; that one Walter McNeil, who resides at Lakeland, Fla., was the executive officer of both defendants and had entire management and control of affairs of each defendant; that the solicitors of said defendants, prior to said rule day in July, prepared the said paper and forwarded the same to the said McNeil, with instructions to cause the same to be signed and to attach thereto the seals of both corporations; that the paper was duly received by the said McNeil and signed by him, but through oversight and without any intention of delaying the progress of said case, the seals were not attached thereto; and prayed that they be authorized and permitted to attach the seal of each defendant to the answer and to refile it with the seals attached. ...
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...14 S.W. (2d) 174; Rathbone v. Forsythe, 156 N.Y. Supp. 888; French v. Row, 28 N.Y. Supp. 849; Kreiss Potassium Phosphate Co. v. Knight, 124 So. 751; Schwed v. Budlecki, 158 Atl. 418; Smith v. Cholstein, 164 S.E. 217. (6) The plaintiff's attempt to accelerate notes three, four and five is un......
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...becoming due under a contract must be founded upon a sufficient consideration (13 C.J. 592: 6 R. C. L. 917. See, also, Kreiss Pot. Phos. Co. v. Knight, supra), and it is a sufficient consideration for an agreement to extend the time of payment that the debtor promises to do anything which h......
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...some clear and unequivocal action indicating its intent to accelerate all payments. See id.; see also Kreiss Potassium Phosphate Co. v. Knight, 98 Fla. 1004, 124 So. 751, 754 (1929) (same). Consequently, Florida courts have concluded that a simple threat to file suit unless immediate paymen......
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...payable was thereby defeated and the suit to foreclose the mortgage was prematurely brought." Kreiss Potassium Phosphate Co. v. Knight, 124 So. 751, 754 (Fla. 1929).[77] "Blackmon's first argument on appeal is that Jim Walter had no right to accelerate the mortgage because Blackmon mailed h......
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...payable was thereby defeated and the suit to foreclose the mortgage was prematurely brought." Kreiss Potassium Phosphate Co. v. Knight, 124 So. 751, 754 (Fla. 1929).[83] "Blackmon's first argument on appeal is that Jim Walter had no right to accelerate the mortgage because Blackmon mailed h......