Ott v. Bray

• Decision Date: 16 April 1934
• Citation: 114 Fla. 547,154 So. 209
• Court: Florida Supreme Court
• Parties: OTT et al. v. BRAY.

154 So. 209

114 Fla. 547

OTT et al. v. BRAY.

Florida Supreme Court

April 16, 1934

Rehearing Denied May 1, 1934.

En Banc.

Suit by Thomas K. Bray, a widower, against Jessie Geneva Ott and her husband, Curtis S. Ott. From a judgment in favor of plaintiff, defendants appeal. Appeal from Circuit Court, Hillsborough County; L. L. Parks, judge.

COUNSEL

Reversed and remanded.

Carl H Moseley and Sparkman & Knight, all of Tampa, for appellants.

Taliaferro Morris & Carter, of Tampa, for appellee.

OPINION

PER CURIAM.

A judgment was assigned to a mortgagee as additional collateral security on an agreement for extension and renewal of a mortgage. Before any payments under the renewal of the mortgage actually matured, the judgment was collected and a portion of the proceeds paid over to the mortgagee by the attorney in fact for the mortgagor. The assignment of the judgment as collateral security was made a condition of the renewal and extension of the mortgage. It provided that any and all sums received by the mortgagee as a collection on the judgment should be immediately applied in the payment or reduction of the mortgage and indebtedness represented by the renewal obligation. Prior to the execution of the assignment the right, title, and interest of the judgment creditor had been pledged by the judgment assignor to the mortgagee with the express understanding that as funds were realized from it from collection or sale of securities pledged, the same should be immediately applied in liquidation of the mortgage debt.

The mortgage extension agreement was executed in July, 1931, but was dated as of April 1, 1931. By it an extension in the time of payment of the mortgage was made for a period of five years from April 1, 1931, interest to be payable semiannually at 7 per cent. on a balance of $16,500. The consideration for the giving of the extension was: (1) Assignment of the judgment above referred to; (2) assignment of the rents on the property held as security; and (3) deeds to certain property in South Carolina; (4) an increased interest rate.

In August, 1931, $7,000 was paid on the mortgage in advance of the extended maturity. This payment was part of the proceeds of the pledged and assigned judgment. The mortgagee did not apply the $7,000 payment so as to anticipate maturities, but so applied the payment as to merely reduce the total amount of the mortgage debt, and thereby bring the mortgagor into early default for the amounts which the nonpayment of has occasioned the institution of this suit. The chancellor ruled with the mortgagee. The mortgagors have appealed, assigning as error the entry of the final decree of foreclosure, which they assert is unwarranted because there was no default under the circumstances.

Our conclusion is that under the circumstances appearing in this record the mortgagors had the right to direct and insist upon the application according to their directions of the $7,000 payment delivered over to the mortgagee in August, 1931. This payment was realized only a very short time after the extension agreement was actually entered into.

It was proved that by written instrument dated August 19, 1931 fifteen days after the money was actually delivered, the representative of the mortgagors requested that the fund of $7,000 that had been paid over on August 4, 1931, be retained and applied to the mortgage so that all payments scheduled to mature during that and the next year should be absorbed or anticipated in the distribution of the fund.

The written demand was ignored and the mortgagee applied the $7,000 payment on the first maturing note for $397 and the balance of...