Mcewen v. Growers' Loan & Guaranty Co.

• Decision Date: 08 February 1932
• Citation: Mcewen v. Growers' Loan & Guaranty Co., 139 So. 805, 104 Fla. 176 (Fla. 1932)
• Court: Florida Supreme Court
• Parties: McEWEN et ux. v. GROWERS' LOAN & GUARANTY CO. et al.

139 So. 805

104 Fla. 176

McEWEN et ux. v. GROWERS' LOAN & GUARANTY CO. et al.

Florida Supreme Court, Division A.

February 8, 1932

Suit by the Growers' Loan & Guaranty Company against C. S. McEwen and wife and others.From several decrees and orders of the chancellor, the defendant named and wife appeal.

Decrees and orders appealed from affirmed.

Appeal from Circuit Court, Lake County; Frank A Smith, judge.

COUNSEL

G. P. Garrett, of Orlando, for appellants.

M. M Kendall, of Tampa, Duncan, Hamlin & Duncan, of Tavares, and Sutton, Tillman & Reeves, of Tampa, for appellees.

OPINION

ELLIS J.

C. S McEwen and wife, Bessie McEwen, executed a mortgage to Growers' Loan & Guaranty Company upon certain described lands in Lake county and all the citrus fruit crops growing and to be thereafter grown upon the lands for a period of five years and until the payment of the indebtedness which the mortgage was given to secure.

The mortgage was given to secure the payment of an indebtedness due by McEwen to the mortgagee in the sum of $10,000 and all renewals and extensions thereof, and to secure the payment of further loans and advances that might be made by the mortgagee, not to exceed, however, a total of $25,000.The mortgage was dated April 2, 1928.There was a note of that date for the sum of $10,000 payable nine months after date, with interest at 8 per cent. per annum from maturity, and signed by C. S. McEwen and described in the mortgage.There was another note for the sum of $15,000 dated March 8, 1929, payable ninety days after date, bearing the same rate of interest and signed by C. S. McEwen.Each note was payable to Growers' Loan & Guaranty Company or order.There was a covenant in the mortgage that the property was free of all liens except a mortgage to A. R. Kunz for the sum of $28,500.The mortgagors agreed to cultivate the fruit trees and give them the care and attention required to produce good merchantable fruit and keep it insured against loss by hail, windstorm, or frost; to pay taxes and assessments that may be imposed upon the premises or fruit crops, and pay all costs incurred in proceedings for the collection of the amount secured by the mortgage, and to pay the debt evidenced by the note and all other obligations secured by the mortgage.

It was agreed between the parties that the Growers' Loan & Guaranty Company operates for the purpose of financing the production and harvesting of crops owned by growers who are members of Citrus Growers' Associations which ship and market their crops through the Florida Citrus Exchange, and that one of the considerations for the loans secured by the mortgage was that the mortgagors should ship and market the citrus fruit crops through the proper agency of the Florida Citrus Exchange.

The mortgagors agreed to become and continue a member of the Lake Region Packing Company as long as that association is active and affiliated with Florida Citrus Exchange, and, if the Lake Region Packing Company became inactive or severed its relations with the Florida Citrus Exchange, then to become a member of another association affiliated with the Florida Citrus Exchange, and to conform to the rules, regulations, and by-laws of the association, and to market through the association, subexchange, and Florida Citrus Exchange, and not otherwise, all of the citrus fruit now growing or hereafter to be grown on the land during the entire period in which the indebtedness or any part of it is owing and unpaid, and in all events to ship and market the fruit during the seasons of 1928-29 to 1930-31, even if the indebtedness should be repaid before the entire citrus fruit for said seasons should be marketed.It was agreed that the proceeds of the sale of the citrus fruits should be paid by the association or citrus subexchange or Florida Citrus Exchange to the mortgagee to be applied on the indebtedness until the principal, interest, insurance, and cost of collection is fully paid.

It was agreed that the mortgagee, for the protection of its interests, might have the fruit picked, packed, and marketed at any time, and for that purpose the mortgagors appointed the Citrus Growers' Association their attorney in fact to act upon the demand of the mortgagee to the end that the proceeds of the sale should be applied to the mortgage indebtedness.

It was agreed that, if the mortgagors made default in the payment of interest or principal for thirty days, or failed to pay taxes, or cultivate the trees, or pay insurance, or to immediately become a member of Citrus Growers' Association, or to ship fruit through that organization, or to comply with and perform any of the covenants on their part to be performed, then the mortgagee might declare all the indebtedness secured by the mortgage to be immediately due, and should have the right to bring foreclosure proceedings, and the mortgagee should in such event be entitled, without notice to the mortgagors, to the appointment of a receiver to take charge of the property and to pick the fruit and market it and apply the proceeds of the sale to the payment of the indebtedness.By the last clause of the mortgage the mortgagors appointed and constituted the mortgagee attorney in fact for the mortgagors in case of default in the payment of the indebtedness or of any breach of the terms of the mortgage to take possession of the fruit crops without suit, and to pick and market the fruit as provided in the mortgage, and apply the proceeds of its sale to the costs and expenses of marketing and to the discharging of the indebtedness and attorneys' fees, and, if any balance remained, to pay it over to the mortgagor.

In August, 1929, the mortgagee, Growers' Loan & Guaranty Company, began its suit against the mortgagors, C. S. McEwen and wife, Bessie McEwen, W. T. Johnson and George W. Burden, as receiver of the Church Street Bank of Orlando, to enforce the mortgage lien.The prayer was for a receiver to take charge of the property and care for it in a scientific manner and to enjoin the mortgagors from interfering with the receiver; that the mortgage be reformed to describe properly the property intended to be covered by it; for an accounting between the mortgagors and mortgagee to ascertain the amount due and sale of the premises or property and application of the proceeds of the sale to the payment of all expenses and indebtedness, and that the lien of the mortgage be declared to be superior to all others claimed, except the Kunz mortgage heretofore mentioned, and for general relief.

It was alleged that in March, 1929, McEwen became indebted to the mortgagee, complainant, in the sum of $15,000 as evidenced by his promissory note for that amount payable ninety days after date.The note was described, and a copy of it was attached to the bill as Exhibit B and made a part of it.

It alleged the execution of the mortgage as described on April 2, 1928, and a copy of the note for $10,000 was attached to the bill as Exhibit A and made a part of the bill.The mortgage was also described, a copy of which was attached to the bill as a part of it and marked Exhibit C.It was alleged that the money was advanced by the complainant to McEwen to enable him to produce the citrus fruit crops upon the land described, and was in accordance with the provisions of section 3515, Revised General Statutes 1920, Comp. Gen. Laws 1927, § 5378, and of chapter 10279,Laws 1925(sections 5741,5742, Comp. Gen. Laws 1927).

This act, chapter 10279, supra, section 5741, Comp. Gen. Laws 1927, was discussed in Summerlin v. Orange Shores, Inc.,97 Fla. 996, 122 So. 508.

It is alleged that there is located upon the lands described in the mortgage embracing about 116 acres approximately 5,225 bearing citrus trees, of which about 2,000 are old and thoroughly matured trees; that all the trees have been neglected by the mortgagor, the older trees not fertilized for more than a year nor properly pruned, nor has the mortgagor sprayed or dusted the crop for the year, and that as a result of such neglect the trees have not produced the crop that they should have produced; that the weeds and undergrowth have not been removed, thus increasing the danger from fires.

The bill alleges that part of the principal sum of $10,000 evidenced by the first note has been paid, but that the balance of $6,102,84 has been due and unpaid for more than thirty days.Several items of interest on different amounts are alleged to be due and unpaid, and that the principal sum of $15,000 evidenced by the second note has been due and unpaid for more than thirty days, and the complainant exercises the option to declare the entire debt described in the mortgage and notes to be due.

It was also alleged that the description of the land mortgage was incomplete, in that the land should have been described as being of Division H'according to the plat of the Town of Montverde,' but that the quoted words were through inadvertence or mistake omitted from the description.It is also alleged that W. T. Johnson claims a lien upon the property by virtue of a judgment obtained against McEwen in Orange county and recorded in Lake county on April 26, 1929, and the complainant alleges its mortgage to be a lien of superior dignity; that George W. Burden as receiver also recovered a judgment in Orange county against McEwen, and a copy of it was recorded in Lake county in January, 1929, and that lien is inferior to complainant's lien.

On the 14th of August, 1929, the chancellor, upon application of the complainant, appointed a receiver of the properties who gave a bond for the faithful performance of his duties.

A motion for compulsory amendment to the bill and a special demurrer to the bill were both overruled; the purpose of these ...