Miami Mortgage & Guaranty Co. v. Drawdy

• Decision Date: 14 May 1930
• Citation: 99 Fla. 1092,127 So. 323
• Parties: MIAMI MORTGAGE & GUARANTY CO. v. DRAWDY et al.
• Court: Florida Supreme Court

127 So. 323

99 Fla. 1092

MIAMI MORTGAGE & GUARANTY CO. v. DRAWDY et al.

Florida Supreme Court, Division A.

May 14, 1930

Suit by the Miami Mortgage & Guaranty Company against D. L. Drawdy and others. Decree of dismissal, and complainant appeals.

Reversed.

Appeal from Circuit Court, Dade County; H. F Atkinson, judge.

COUNSEL

Willard & Knight and George Edward Holt, all of Miami, for appellant.

Gallagher & Davis and Mitchell D. Price, all of Miami, for appellees.

OPINION

ELLIS J.

D. L Drawdy and Anna Drawdy, his wife, on April 21, 1925, owed Miami Mortgage & Guaranty Company $6,000. As evidence of the debt, Drawdy and wife executed their promissory note for that amount in favor of the Miami Mortgage & Guaranty Company payable three years after date, with 8 per cent. per annum interest payable semiannually. The interest payments were evidenced by coupon notes in the sum of $240 and attached to the note for the principal sum.

To secure the payment of the debt and interest accruing thereon, the Drawdys executed a mortgage upon certain real property. A month after this transaction the Miami Mortgage & Guaranty Company transferred the note and mortgage to John L. Brigham. The Drawdys failed to pay the interest coupon note which became due on April 21, 1927, the fourth of such coupon notes, and the Mortgage & Guaranty Company, the original creditor and mortgagee, paid the note to Brigham, being obligated to do so by reason of its indorsement of the note to Brigham.

The Mortgage & Guaranty Company then exhibited its bill in chancery against the Drawdys to enforce the mortgage security to the payment of the interest debt represented by the coupon note. L. R. Moss and his wife, Eva, were made parties, because it was alleged that they claimed some interest in the premises.

The complainant bases its right to maintain the suit upon a subrogation to the rights of Brigham to demand payment of the note from Drawdy and to enforce the mortgage security against him to collect it, subject, nevertheless, to the claims of Brigham and his rights as secured by the mortgage.

The Drawdys demurred to the bill, and so did L. R. Moss. The demurrers were sustained and the bill was dismissed, from which decree the Miami Mortgage & Guaranty Company appealed.

The interest due upon the principal debt was as much a part of the debt as the principal. It was secured by the mortgage as fully as the principal. The transfer of the indebtedness, that is, the amount due and secured by the mortgage, to any one by lawful means, carries with it the mortgage security without any written assignment of the latter. See Taylor v. American Nat. Bank, 63 Fla. 631, 57 So. 678, Ann. Cas. 1914A, 390, note; McClure v. American Nat. Bank, 67 Fla. 32, 64 So. 427; Collins v. W. C. Briggs, Inc. (Fla.) 123 So. 833; Harris v. Robertson, 77 Fla. 214, 81 So. 214; Evins v. Gainesville Nat. Bank, 80 Fla. 84, 85 So. 659; Scott v. Taylor, 63 Fla. 612, 58 So. 30.

The right to foreclose the mortgage for the failure to pay an interest installment, although the principal sum may not be due, is undoubted, even though there is no acceleration clause in the mortgage, or, if there should be, and the complainant does not exercise his option to declare the entire debt due, the mortgage may be foreclosed for the unpaid interest due. See Warren v. Creevey, 87 Fla. 46, 99 So. 247; White v. Gracey, 45 Fla. 657, 34 So. 223.

The note for the principal sum contained a clause that the note 'together with the coupons hereto attached are secured by a mortgage deed of even date and are subject to each and every of the conditions, stipulations and agreements therein set out.' The mortgage contained a covenant to 'pay all and singular the principal and interest and other sums of money payable by virtue of said promissory note and this deed, or either, promptly on the days respectively the same severally come due.'

The case of Kirk v. Van Petten, 38 Fla. 335, 21 So. 286, is therefore not controlling in this case.

There is no question that the creditor and holder of the mortgage security could maintain his bill to enforce the mortgage. If he had been made a party to the bill as complainant, the question would not be in the case. The complainant says that as its prayer is for the enforcement of the mortgage subject to the rights of Brigham as creditor and holder of the principal debt and mortgage security he is not injured by the proceedings, and the defendants may not complain; that it seeks only to be subrogated pro tanto to the security held by Brigham with the right to enforce subrogation by...