T. O. REVES AND SUSIE REVES, HIS WIFE, ROLLEN R. MARTIN, FORT PIERCE BANK & TRUST COMPANY, AND HEIM-MARTIN INVESTMENT CORPORATION, APPELLANTS,
v.
F. S. YOUNGHUSBAND, APPELLEE

Fla. | 1931-04-13
Ellis and Brown, J.J., concur., Whitfield, P.J., and Terrell and Davis, J.J., concur in the opinion and judgment.
101 Fla. 165 Florida Supreme Court (1931) Positive Treatment
Cited by 10 cases

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Synopsis

This mortgage foreclosure case addresses the enforceability of attorney's fees in a deficiency decree and the effect of statutory repeal on a creditor's right to pursue deficiency judgments against endorsers. The court held that while attorney's fees were improperly awarded without evidence, the endorser remains liable on the underlying obligation despite changes in procedure.


Holding

The court held that attorney's fees were improperly awarded because there was no evidence of what fee the complainant had obligated to pay or the contract terms with counsel. The deficiency decree was erroneous to the extent it included the attorney's fee award. However, the repeal of the authorizing statute did not eliminate the endorser's underlying contractual liability; the creditor may pursue deficiency judgments at law against the endorser even though the court's equity jurisdiction to enter deficiency decrees against endorsers was abolished.


Key Quotes

“The authorization of the entry of a deficiency decree, or the lack of authorization to enter a deficiency decree, does not effect the liability under the contract. The endorser is liable to the holder in due course for the amount of the obligation and it is immaterial, so far as the liability on the obligation is concerned, whether such liability may be enforced in a court of chancery or in a court of law.”

Establishes the court's key holding that statutory repeal affecting procedural authority does not extinguish the substantive contractual liability of the endorser.

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Facts & Procedural History

Younghusband purchased a mortgage and three promissory notes (each for $5,000 plus 8% interest) that were originally executed by Rollen R. Martin to F…

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Opinion of the Court
Buford, C.J.

Buford, C.J.

— .This was a suit by Younghusband to foreclose a mortgage made by Rollen R. Martin to Fort Pierce Bank & Trust Company to secure the payment of three promissory notes for the sum of $5,000.00 each with interest at 8% and including a stipulation to pay attorney’s fee in event of suit for collection of the notes, which mortgage was assigned to the complainant by Port Pierce Bank & Trust Company and which notes were endorsed to the complainant by Fort Pierce Bank & Trust Company. Why other parties defendant were named is immaterial here.

Final decree was in favor of the complainant and required Fort Pierce Bank & Trust Company and Martin to pay to the complainant the amount found to be due, together with $1,000.00 as attorney’s fees. After sale of the property there was a deficiency decree entered for $9,900.65. The appeal is from the final decree and from the decree confirming the sale and entering a deficiency against Fort Pierce Bank & Trust Company and Martin.

There was no reversible error in the final decree, except as to that part of the decree which required the payment of $1,000.00 as attorney’s fees. The allegations of the bill of complaint were sufficient to constitute basis for evidence touching the attorney’s fees, but there was no evidence showing what, if any, fee the complainant had obligated to pay or what the contract was between the complainant and the attorney as to attorney’s fees. Therefore, decree for attorney’s fees were improperly entered.

The deficiency decree is erroneous because it includes *167the sum of $1,000.00 allowed for attorney’s fee. Otherwise the deficiency decree is without reversible error as to the defendant Rollen R. Martin.

The authority to enter deficiency decrees in foreclosure suits, or in any other class of suits, is controlled either by statute or by rule of court.

At the time the mortgage here under consideration was executed and at the time it was assigned to the complainant the provisions of chapter 7839 Laws of 1919 were in force and the complainant contends that because of this fact the court was' authorized to enter a deficiency decree against the endorser. This position is not tenable. The authorization of the entry of a deficiency decree, or the lack of authorization to enter a deficiency decree, does not effect the liability under the contract. The endorser is liable to the holder in due course for the amount of the obligation and it is immaterial, so far as the liability on the obligation is concerned, whether such liability may be enforced in a court of chancery or in a court of law. The procedure necessary to the enforcement of the liability does not touch the existence or the binding effect of the liability. Chapter 12325, Acts of 1927, repealed chapter 7839 Acts of 1919 and thereby abolished the authority of courts of chancery to enter deficiency decrees against endorsers. This repealing Act, however, had no effect upon the obligation under the contract here sued on. That contract remained binding upon the endorser to pay the amount of the endorsement and if, as it has occurred in this ease, the mortgage security is inadequate to pay the full amount of the obligation, the complainant may proceed in an action at law to procure judgment against the endorser for the balance while taking a deficiency decree in a foreclosure suit against the original maker for such *168balance. The payment of the amount of the deficiency decree or the payment of the judgment at law for such deficiency would satisfy both the decree and the judgment.

For the reasons stated, the decree should be reversed with directions that the chancellor enter a decree as of the date of the original decree in conformity with the views expressed in this opinion. It is so ordered.

Reversed and remanded.

Ellis and Brown, J.J., concur.

Whitfield, P.J., and Terrell and Davis, J.J., concur in the opinion and judgment.


Cases With Similar Vibessemantic neighbors from the corpus


Citator

Cited By

  • Degge v. The First State Bank of Eustis, 145 Fla. 438 (Fla. 1941)
    …eficiency for further consideration. On appeal we reviewed the correctness of the order denying the deficiency against the bank. In this case the chancellor was guided in his decision by the decisions of this Court. Reves, et al., v. Younghusband, 101 Fla. 165, 133 So. 618; Prevatt, et ux., v. The Federal Land Bank of Columbia, 129 Fla. 464, 176 So. 494. In [*441] these cases this Court held that equity was without power to enter a deficiency decree in a mortgage foreclosure against the endorser of the mo…
  • Van Sant v. Duval Cattle Co., 116 Fla. 159 (Fla. 1934)
    …the obligation of the notes and mortgage, here involved, for it affected only a remedy upon them and a sufficient remedy remained. The remedy upon the notes at law cannot be said to be inadequate or inferior to that in equity. Reves v. Younghusband, 101 Fla. 165, 133 So. 618; Tennessee, ex rel. Bloomstein v. Sneed, 96 U. S. 69, 24 L. Ed. 610; South Carolina, ex rel. Trenholm v. Gaillard, 101 U. S. 433, 25 L. Ed. 937: Thd filing by the bank of its bill before the Act was repealed fixed no indefeasible right,…
  • Cornman v. Wilder, 113 Fla. 164 (Fla. 1933)
    …ell v. Richardson, 67 Fla. 386 (text 395), 65 South. Rep. 592; Fagan, Jr., v. Robbins, 96 Fla. 91, 117 South. Rep. 863; Younghusband v. Ft. Pierce Bank & Trust Co., 100 Fla. 1088, 130 South. Rep. 725; Chapter 12325, Acts 1927; Reves v. Younghusband, 101 Fla. 165, 133 South. Rep. 618. The court had no jurisdiction to enter the deficiency judgment against Wright, Warlow & Company as indorsers of the note; therefore, the entry of such a decree was a nullity and could be therefore stricken from the record at a…

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