Court Opinion

ID: 3877455
Source: CourtListenerOpinion
Date Created: 2016-07-06 09:10:03.756936+00
Date Added: 2024-06-11T13:35:30.501494
License: Public Domain

November 14, 1923. The opinion of the Court was delivered by
This is an action to foreclose a mortgage. The appellant's counsel in their argument make the following statement:
"This is an action for judgment on a promissory note in the sum of $7,792.45, and foreclosure of a mortgage securing the payment of the same. The note and mortgage were executed and delivered to J.J. Fretwell by his codefendant, M.G. Smith, and assigned to the estate of S: D. Brownlee, deceased, by J.J. Fretwell. In the assignment he guaranteed the estate against loss of principal or interest. The executors of the estate of S.D. Brownlee assigned the note and mortgage to the plaintiff, who is a beneficiary of the said estate. The note is due one day after date, but there is a provision in the mortgage that, `if the said M.G. Smith pays the interest promptly each year when due on this debt, J.J. Fretwell agrees to carry the same for a period of 10 years.' The appellant admits that she received the interest from J.J. Fretwell promptly on January 1st of each year when due, and this is confirmed by the testimony, but Fretwell was reimbursed by Smith in September, 1921, for the interest maturing January, 1921. This interest was not paid by Smith, therefore, at maturity. The testimony further shows that Smith did not pay the interest maturing January 1, 1922, but he did reconvey a part of the land to J.J. Fretwell on the 24th day of December, 1921, *Page 265 
for the expressed consideration of $4,737, which sum Fretwell was to credit on Smith's note, but which he has not done, and did not tell Smith that he did not then own the note. This shows, according to the mortgagor's own testimony, that when this action was commenced in May, 1922, he had not paid any interest for the year 1921, and had delayed paying the interest for the year 1920 nine months after it was due. The appellant was the owner and holder of the note and mortgage at the time of the reconveyance of a part of the land by Smith to Fretwell, and she did not consent to this transfer, and had no knowledge thereof until a short time before filing the suit, and she did not know when she received the checks from Fretwell for interest that he was paying same with his own money. In fact had Fretwell credited the note on December 21, 1921, by the $4,737, as he promised Smith, Smith would not have owed appellant a full year's interest on the original principal on January 1, 1922, and consequently Fretwell's check to appellant on that date was in excess of what Smith would have owed appellant, and the excess represents a personal payment by Fretwell, evidently made by him for the purpose of trying to force an extension of the debt for his own benefit. Can Fretwell continue to refuse to pay appellant the $4,737, and by tendering the full amount of interest on the original debt at each maturity date force appellant to wait until the expiration of the 10-year period to enforce payment of the principal of her debt, or of the $4,737? If so, then he can convert a personal privilege made only to Smith to his own benefit, and thereby make his assignee await his pleasure in the matter, subject to such loss as time might bring as to his solvency, the land, we may safely assume, not being worth the debt."
The case was tried before Judge Rice, who refused the plaintiff a decree of foreclosure. The Decree of Judge Rice, which will be reported, is so full and satisfactory that little more need be written. *Page 266 
The fundamental error of the appellant is that she is not entitled to take advantage of a failure, if any, on the part of Fretwell to perform a subsequent contract made between Smith and Fretwell. The appellant was not a party to that agreement, and it was not made for her benefit. The appellant, Mrs. Holman Smith, and Fretwell were interested in the note and mortgage (two parts of one contract), and Fretwell was entitled to pay the interest due by Smith and thereby extend the time of payment. The mortgage provided for insurance, it is true, but a failure to insure and assign the policy to the holder of the mortgage gave the right to the holder of the mortgage to insure, but it was not to be a forfeiture of the time of payment. This action was prematurely brought, and counsel fees cannot be allowed, or judgment on the note.
The judgment is affirmed.