Court Opinion

ID: 3493427
Source: CourtListenerOpinion
Date Created: 2016-07-05 22:01:33.589268+00
Date Added: 2024-06-11T14:05:09.810300
License: Public Domain

March 28, 1930, defendants Van Ommen, herein referred to as defendants, gave plaintiff a purchase-money mortgage for $2,300, due in 10 years, interest payable semi-annually, with an acceleration clause, operative upon default of interest payments. Defendants also agreed to pay all taxes and assessments levied upon the property and to keep the buildings erected thereon insured. An insurance policy was issued to defendant Bert Van Ommen, with loss, if any, payable to plaintiff as his mortgage interest might appear. Defendants did not pay interest upon the mortgage, nor the taxes upon the property, and plaintiff exercised the right of election under the acceleration clause and declared the full amount of the mortgage due. A barn upon the premises burned in July, 1932, and the insurance company issued a check for the loss, payable to the order of plaintiff and Bert Van Ommen. Mr. Van Ommen refused to indorse the check and plaintiff has not received the money thereon. August 17, 1932, plaintiff filed the bill herein for foreclosure of the mortgage. Defendants, by answer, admitted default in payment of interest and taxes and, by cross-bill, alleged fraudulent inducement in procuring the mortgage and asked for cancellation.
Defendants were in default and, under the terms of the mortgage, full payment thereof was at the election of plaintiff accelerated and made due. Plaintiff exercised the right agreed upon and thereby definitely fixed the rights of the parties. Thereafter neither defendants nor the court could fix the rights of plaintiff otherwise. Defendants made no proof in support of their cross-bill and it was dismissed and no appeal taken.
Defendants, during pendency of the suit, paid $170.75, being the taxes for 1930, 1931 and 1932, and *Page 675 
the insurance premium paid by the plaintiff, with interest thereon to the date of payment. Defendants never paid any interest on the mortgage principal and there was due at the time of hearing for such item the sum of $434.70.
Upon settlement of the decree plaintiff testified:
"I have not received the cash on that check for the fire loss on the farm. I asked them this morning and he says he don't know if he can pay me the money in cash. That's what he told me this morning. That's what the insurance agent told me, the secretary of the insurance company. The Zeeland bank on which the check is drawn is not paying out cash. I didn't get any money at all. I went to the secretary of the insurance company, and asked for a new check and asked for the money, and he told me he couldn't pay. They didn't have no money on hand. They couldn't pay it. The secretary of the insurance company says, I will give you a note."
The court decreed:
"That the said defendant insurance company, upon surrender of said check, issue another check for the said sum of $560 payable to plaintiff alone and that the same, when paid, shall be satisfaction in full of the liability of said defendant insurance company on account of said fire loss, and that the said sum of $560, when paid, be applied by plaintiff as follows: $434.70 on interest here now found to be due on said note and mortgage, $65.50 on plaintiff's costs of suit, hereby allowed to plaintiff, and $59.70 on the principal sum of said note and mortgage."
The decree did not, in terms, dismiss plaintiff's bill but, in effect, it was a dismissal and must be so considered. The court evidently entertained the view that Act No. 98, Pub. Acts 1933, commonly *Page 676 
known as the moratorium act, authorized disposal of the case in the manner mentioned. The mentioned statute has no application for it was not invoked by defendants; neither were any of its provisions followed by the court and, therefore, its constitutionality is not here involved. Plaintiff's right to foreclose cannot be sidetracked in the manner attempted. The inability of plaintiff to obtain payment of the insurance from the company we have mentioned, but find it unnecessary to accord the fact more than passing notice. Plaintiff is entitled to a decree according him the rights contracted for in the mortgage, and operative by default of defendants and such rights before the court commanded a decree of foreclosure, and the action had was an unwarranted closing of the court to plaintiff.
This court has held that the court of equity has power to relieve the mortgagor from the effect of an operative acceleration clause when the default upon which the acceleration election is exercised is the result of some unconscionable or inequitable conduct of the mortgagee.Wilcox v. Allen, 36 Mich. 160; Zlotoecizski v. Smith, 117 Mich. 202;  Rathje v. Siegel, 243 Mich. 376. Nothing of such a nature is present in the case at bar. The default of defendants and the election of plaintiff made the full amount of the mortgage due and the court could not decree otherwise.
In Graf v. Hope Building Corp., 254 N.Y. 1 (171 N.E. 884, 70 A.L.R. 984), right of election, under an acceleration covenant, was exercised, followed by tender of the payment in default, and the court employed the following language pertinent to the instant case:
"Plaintiffs may be ungenerous, but generosity is a voluntary attribute and cannot be enforced even *Page 677 
by a chancellor. Forbearance is a quality which under the circumstances of this case is likewise free from coercion. Here there is no penalty, no forfeiture (Ferris v. Ferris, 28 Barb. [N.Y.] 29; Noyes v. Anderson, 124 N.Y. 175, 180 [26 N.E. 316,317, 21 Am. St. Rep. 657]), nothing except a covenant fair on its face to which both parties willingly consented. It is neither oppressive nor unconscionable (Valentine v. VanWagner, 37 Barb. [N.Y.] 60). In the absence of some act by the mortgagee which a court of equity would be justified in considering unconscionable, he is entitled to the benefit of the covenant. The contract is definite and no reason appears for its reformation by the courts (Abrams v. Thompson, 251 N.Y. 79,86 [167 N.E. 178]). We are not at liberty to revise while professing to construe (Sun P.  P. Ass'n v. Remington P.  P.Co., 235 N.Y. 338, 346 [139 N.E. 470]). Defendant's mishap, caused by a succession of its errors and negligent omissions, is not of the nature requiring relief from its default. Rejection of plaintiffs' legal right could rest only on compassion for defendant's negligence. Such a tender emotion must be exerted, if at all, by the parties rather than by the court. Our guide must be the precedents prevailing since courts of equity were established in this State. Stability of contract obligations must not be undermined by judicial sympathy.
The case is remanded to the circuit court with direction to enter decree of foreclosure.
Plaintiff will recover costs.
POTTER, SHARPE, NORTH, FEAD, and BUTZEL, JJ., concurred with WIEST, J. McDONALD, C.J., took no part in this decision.
The following opinion was written and signed by Mr. Justice WEADOCK while a member of this court. At his request it is published herewith. *Page 678