Tuttle v. Jockmus

• Decision Date: 03 October 1927
• Citation: 138 A. 804,106 Conn. 683
• Court: Connecticut Supreme Court
• Parties: TUTTLE v. JOCKMUS.

138 A. 804

106 Conn. 683

TUTTLE v. JOCKMUS.

Supreme Court of Errors of Connecticut.

October 3, 1927

Appeal from Superior Court, New Haven County; Arthur F. Ells and Earnest C. Simpson, Judges.

Action by Herman C. Tuttle against Charles H. Jockmus to recover a debt secured by a mortgage which defendant is alleged to have assumed and agreed to pay. Judgment for defendant, and plaintiff appeals. Error, judgment set aside, and cause remanded.

Maltbie and Hinman, JJ., dissenting.

O. K Reaves, of Tampa, Fla., and Philip Reich and Samuel Reich both of Bridgeport, for appellant.

Robert L. Munger, of Ansonia, for appellee.

Argued before WHEELER, C.J., and MALTBIE, HAINES, HINMAN, and AVERY JJ.

WHEELER, C.J.

The complaint alleges that on July 3, 1925, the plaintiff, Tuttle, together with his wife, conveyed by warranty deed to Whitney Curry and five others a tract of land in Florida. On July 25, 1925, these grantees executed four promissory notes payable to the plaintiff, Tuttle, each for $24,000, for the unpaid balance of the purchase price for this tract, and on the same date executed a mortgage to secure their payment. On November 3, 1925, these grantees conveyed by warranty deed to Palmetto Properties, Incorporated, the above real estate, which it in the deed assumed and agreed to pay. On the same day, November 3, 1925, Palmetto Properties, Incorporated, conveyed this property to Musick, as trustee, subject to this mortgage, which he as trustee assumed and agreed to pay. On the same date Musick, as trustee, and Jockmus, defendant, Lalley, and Musick individually, as cestuis que trustent, entered into an agreement, styled therein a declaration of trust. The agreement recites the transfer of this real estate to Musick, trustee, and that the title to it is to be held by him as trustee under this declaration of trust. It then recites that, in consideration of the agreements therein and of the property transferred to Musick, trustee, for the purposes of the trust, Musick covenants that he will hold, use, and manage the property and the profits arising from its use or sale for the purposes of the trust and the benefit of the cestuis que trustent, subject to his right as trustee to manage, sell, convey, mortgage, and lease the property and exercise over it at his discretion the powers of the trust for the duration of the trust, and that all moneys, funds, and properties arising from the rents, leases, or sale of the property shall be held for the benefit of the cestuis que trustent and be divided as follows: Jockmus 69.6 per cent., Lalley 15.2 per cent., and Musick 15.2 per cent. The cestuis que trustent agree that they will pay their pro rata share of any and all expenses, including mortgage payment, in the proportions specified for sharing in the profits or proceeds.

The trust is limited to a period of one year, and may be terminated sooner by the sale and disposition of the proceeds to the cestuis que trustent in the proportion outlined, or it may be extended for a period mutually agreed upon by the cestuis que trustent. In case of the death, disability, or refusal of Musick to act as trustee, then the Manatee River Bank & Trust Company, or such person or persons as Jockmus and Lalley shall designate, shall be the successor in the trust, with like powers, and the title to the property shall vest in such successor for the uses and benefits and upon the trusts above specified. This declaration was executed November 27, 1925, and recorded December 3, 1925.

The plaintiff, Tuttle, is the owner of the notes and mortgages referred to, and they are wholly unpaid. One of the notes and the indebtedness thereby became due and payable July 25, 1926. The notes bear interest at the rate of 8 per cent. per annum, payable semiannually from date. The mortgage provides:

" It is covenanted and agreed that, in case this note or any installment of interest is not paid when the same is due and payable according to the tenor and effect of the notes, * * * then the whole sum of principal and interest remaining unpaid shall, at the option of the owner * * * of the notes, * * * become due and collectible at once."

Installments of interest which became due on these notes and indebtedness on January 25, 1926, had not been paid on July 25, 1926.

The demurrer could have been consolidated into three points, and these we will consider in the order of their proper precedence. The first of these contentions is that the law of Florida governs the construction of the conveyances and the declaration of trust, and of the promises and agreements contained therein, and by that law no action, legal or equitable, lies upon a promise contained in the deed to Musick or in the declaration of trust, to pay the mortgages outstanding against the property conveyed at the time of the conveyance. So far as the rights of the parties are affected by the conveyances and the declaration of trust, they must be determined by the law of Florida. Braman v. Babcock, 98 Conn. 549, 558, 120 A. 150. There the land lies; there the mortgage and notes were executed; there Musick as trustee and as an individual, and Lalley, executed the declaration of trust; and there the acts of the trustee thereunder and the disposition of the property under the trust were to be performed. The parties to these instruments must have contemplated that the law of Florida should control the determination of their rights thereunder. Fisk's Appeal, 81 Conn. 433, 438, 71 A. 559; Brine v. Insurance Co., 96 U.S. 627, 637, 24 L.Ed. 858.

The complaint contains no allegation that the law of Florida gives to the holder of a mortgage the right to sue a purchaser of the equity of redemption, who, in the deed to him, assumes and agrees to pay the mortgage. The omission is of no legal consequence, since we have the right to take judicial notice of the printed statutes and judicial decisions of other states (General Statutes, § § 5726, 5727); moreover, counsel for the parties assumed in argument that these might be considered in determining plaintiff's right to recover. The statutes of Florida do not accord to the plaintiff the right to maintain an action upon an assumption of, and an agreement to pay, the mortgage and the debt for which it is security, contained in the deed to Musick. They do recognize a right in the holder to have a deficiency judgment against the party or parties liable for the mortgage debt, " whether such liability is primary or secondary, and whether" it " is created by indorsement of the note or as joint maker of the note or guarantor or otherwise of the obligation sought to be enforced." Florida Cumulative Statutes 1925, § 3847(2). Florida also has a statute (Rev. Gen. St. 1920, § 2561) providing that " any civil action at law may be maintained in the name of the real party in interest." This provision obviates the intervention of nominal parties plaintiff to work out the rights of the real parties in interest, as was frequently necessary at common law, but it does not purport to create any new rights or liabilities.

We must therefore find in the opinions of the Supreme Court of Florida, in the absence of a statute, a right in the plaintiff to maintain an action by the holder of a mortgage against a grantee of the equity upon his promise to the grantor of the equity to pay the mortgage upon the property conveyed. The right of the mortgagee to bring an action upon an assumption of the mortgage by the grantee of the equity of redemption is ordinarily based upon the principle which permits a third party to bring an action upon a contract made for his benefit. 1 Williston on Contracts (1924 Ed.) § 384. In Hunter v. Wilson, Stearly & Co., 21 Fla. 250, 252, it was held:

" Although the right of one to sue on a promise made to another for his benefit has been controverted, the doctrine is now well settled that he can maintain such a suit if the promise be not under seal."

The court quotes from Hendrick v. Lindsay, 93 U.S. 143, 149, 23 L.Ed. 855, in which the right of a third party beneficiary to sue upon a written contract not under seal is upheld, but it is expressly stated that the action would not lie if the contract were under seal. In the absence of a subsequent reversal of this pronouncement, either expressly or by necessary inference, we should feel obliged to hold that the law of Florida would not permit this plaintiff to maintain this action, since it is based upon a promise under seal. The seal in many jurisdictions has lost much of its significance in matters of procedure, as it has with us ( Hartford-Connecticut Trust Co. v. Devine, 97 Conn. 193, 195, 116 A. 239, 21 A.L.R. 134), but we do not find that by statute this has been effected in Florida. Two decisions of the Florida Supreme Court only appear to bear upon the point we are discussing.

In Herrin, Whitted, et al., Appellants, v. Abbe, Appellee, 55 Fla. 769, 46 So. 183, 18 L.R.A. (N. S.) 907, Herrin held the equity of redemption of property subject to a mortgage to Abbe, plaintiff in the action to foreclose and appeal upon this appeal, which he had orally assumed and agreed to pay at the time of conveyance to him of this equity. Herrin conveyed the equity to Whitted, who assumed and agreed to pay the mortgage indebtedness. Abbe brought foreclosure against Herrin and secured a decree which adjudged that " Whitted ‘ assumed and agreed to pay the complainant's [Abbe] mortgaged indebtedness.’ " Abbe then sought a decree against Whitted for a deficiency judgment, upon his promise to assume the mortgage indebtedness in the conveyance from Herrin to him. The court decreed that Whitted, grantee of Herrin, was personally liable for the deficiency judgment. The court held:

" A parol agreement by the grantee, at the time of

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