State Bank of Orlando & Trust Co. v. Macy

• Decision Date: 06 April 1931
• Citation: 133 So. 876,101 Fla. 140
• Parties: STATE BANK OF ORLANDO & TRUST CO. et al. v. MACY.
• Court: Florida Supreme Court

133 So. 876

101 Fla. 140

STATE BANK OF ORLANDO & TRUST CO. et al. v. MACY.

Florida Supreme Court

April 6, 1931

Commissioners' Decision.

Suit by George E. Macy and Margaret J. Macy against the State Bank of Orlando & Trust Company, as administrator of the estate of A J. Nye, deceased, and others, continued in the name of the complainant Margaret J. Macy, after death of complainant George E. Macy. From interlocutory orders overruling a demurrer and certain pleas of defendants named to the bill of complaint, defendants appeal.

Affirmed.

Syllabus by the Court.

SYLLABUS

A mortgage does not technically become a 'claim' or 'demand' against a decedent's estate until it ripens into a debt due, even though claim should be filed thereon.

Under chapter 10119, Acts of 1925, a mortgage executed by an intestate, not presented to the administrator within the statute of nonclaim, was barred, in the absence of an acceptance of interest by the holder or waiver by other acts.

The party having claims or demands against the estate of an intestate must pursue some course to present them, as mere knowledge on the part of the representative of the estate of the existence of the claims or demands is not sufficient to constitute a waiver.

The intent and purpose of chapter 10119, Acts of 1925, was to make it more convenient for claimants to evidence their claims in a more orderly way at a more convenient and permanent place equally available to all persons affected.

The payment of interest on a mortgage, made by decedent, by the administrator during the twelve-month period in which proof of claims are required to be filed, constitutes a waiver of the failure to so file such claim.

Under the proviso in section 2 of chapter 11994, Acts of 1927 amending section 2 of chapter 10119, Acts of 1925, the lien of a recorded mortgage on the real property of a decedent and the right to foreclose it, is not impaired or affected by failure to present same to the county judge within one year except to bar any personal liability of deceased's estate.

Section 33 of article 3 of the Constitution forbids the Legislature to lessen the time within which a civil action may be commenced on any cause of action existing at the time of its passage.

Neither chapter 10119 nor 11994 undertakes to limit the powers, duties, and responsibilities of executors and administrators, though they require that all claims and demands shall be presented to and filed with the county judge. Appeal from Circuit Court, Orange County; Frank A. Smith, judge.

COUNSEL

Dickinson & Dickinson and Allison E. Palmer, all of Orlando, for appellants.

Maguire & Voorhis, of Orlando, for appellee.

OPINION

ANDREWS C.

This cause is here upon appeal from interlocutory orders of the circuit Court of Orange county overruling (1) a demurrer of the Orlando Bank & Trust Company, and (2) certain pleas of the State Bank of Orlando & Trust Company (treated in the trial court as a speaking demurrer) to the bill of complaint which had for its purpose the foreclosure of a mortgage given by A. J. Nye and Annette E. Nye to Geo. E. Macy and Margaret J. Macy. While the suit was pending, Geo. E. Macy died, and on September 4, 1928, an order was made continuing the suit in the name of complainant Margaret J. Macy, appellee here.

The bill of complaint alleges that on October 15, 1922, A. J. Nye executed a note in the sum of $3,500 to Geo. E. Macy and Margaret J. Macy, his wife, payable five years after date, with interest at the rate of 8 per cent. per annum, payable semiannually; and that, to better secure said note, a mortgage covering certain real property was on the same date executed by A. J. Nye and Annette E. Nye to Macy and wife and duly recorded; that on April 13, 1926, A. J. Nye died intestate, leaving a wife, Annette E. Nye, and four children surviving him; that on April 17, 1926, letters of administration were granted to the State Bank of Orlando & Trust Company and the first notice to creditors to present claims was duly published on April 28, 1926; that on May 15, 1926, complainants received a blank affidavit of claim from the administrator with a letter of instructions to execute and return to administrator; that, in response thereto, complainants went personally to the administrator, who advised that it could not pay the mortgage at that time, and that, as the mortgage was not yet due, to let it remain as a lien against the property described therein until paid; that thereafter the semiannual interest on said indebtedness was paid promptly by the administrator up to October 15, 1927, when said mortgage and note fell due; that, when complainants talked with the administrator to ascertain if the note would be paid when due, the administrator suggested that the indebtedness be renewed and that it was unnecessary to execute a new mortgage, as the payment of interest, which was later paid on October 18, 1927, renewed the mortgage; that on January 4, 1928, Annette E. Nye filed petition for allotment of dower in the estate of her deceased husband, whereupon commissioners were appointed and the allotment was on the same date made and duly confirmed by the county judge; that the property described in the mortgage was included in that set aside as dower to Mrs. Nye; that soon thereafter Mrs. Nye advised complainant that the mortgaged property had been allotted to her as part of her dower and that she was not in position at that time to pay said mortgage, but said she would keep the property insured and pay interest and taxes; that, when the next semiannual interest fell due on April 15, 1928, Mrs. Nye advised complainant that her attorney had instructed her not to pay interest, as the estate would pay it; that complainant was thereupon advised by the trust officer of the administrator that, while they had enough money on hand to pay said interest, complainant would have to see the county judge; that the interest was not paid, and the trust officer of the administrator advised complainants that the mortgage should be foreclosed and thereupon the note and mortgage were placed in the hands of complainants' attorneys who filed suit on May 24, 1928.

The bill further alleges that on December 30, 1927, the administrator filed in the office of the county judge a suggestion of insolvency of the estate of A. J. Nye and listed the note as part of the outstanding obligations, and listed the property incumbered by the mortgage among the assets of the estate; that in March, 1928, complainants received notice from the county judge to present any claim they had against the estate of A. J. Nye, and, in response to said notice, complainants' claim was filed with the county judge.

The demurrers filed to the bill raised practically the same issues, which may be briefly stated as follows: That the bill of complaint fails to show complainants presented and filed their mortgage claim in the office of the county judge within twelve months from the date of the first publication of said notice, as provided by chapter 10119, Laws of Florida 1925, section 1 of which requires all claims against an estate to be presented and filed in the office of the county judge within one year from date of first publication of notice to creditors. Section 2 of said act reads as follows:

'No claims or demands shall be valid or binding upon an estate, or the executor or administrator thereof, unless the same shall be duly sworn to and presented to the County Judge of the county granting letters testamentary or of administration on an estate, at his office in the Court House of said county; and any claims or demands not so presented within twelve months from the time of the first publication of the notice provided for in Section 1 hereof, shall be barred by limitation.'

It was subsequent to the above enactment that A. J. Nye died (April 13, 1926), though the act had been in force only a few months before the publication of the notice to creditors.

The issues in this case raise a very delicate and important question. It is insisted by appellants that, by the failure of complainants to file their sworn statement as to their mortgage claim in the office of the county judge within one year from first publication of notice, their mortgage is barred. To so hold would in substance mean that so solemn a document as a recorded mortgage which the statute provides shall be a specific lien and valid as against limitation for 20 years, would ipso facto become extinguished and void for all time by the mere failure to present the statement to the county judge instead of the administrator as formerly. It is also alleged that complainants brought the specific matter to the personal attention of the executor, and the indebtedness was recognized and interest regularly paid thereon until the due date of the principal, when they were caused to extend the mortgage at the request of the defendant. Another question raised, which, while it may not be controlling, is: Does a mortage of record which does not fall due within the statutory period of one year from date of first publication of notice to creditors, constitute, within the meaning of the statute, a 'claim' or 'demand' requiring a sworn statement to be filed with the county judge? A recorded mortgage is generally considered constructive notice to all creditors and purchasers.

As a matter of law, a mortgagee cannot effectively 'demand' the payment of a mortgage or note until it becomes due so long as interest payments and other requirements are regularly met, and a mortgage does not technically become a 'claim' until it ripens into a debt due.

We have a few cases construing the nonclaim statute effective in this state from 1828, until the above-quoted act of 1925 was enacted. A...