Court Opinion

ID: 7073097
Source: CourtListenerOpinion
Date Created: 2022-07-24 07:58:10.911761+00
Date Added: 2024-06-11T16:12:39.985462
License: Public Domain

SULLIVAN, Judge,
dissenting
I fully agree that the Hartles contracted with Vilesek to pay the "mortgage indebtedness" and that such agreement could have been enforced directly against the Hartles by the Bank. I further agree that a mortgage is security for payment of a debt. Additionally, I agree that "it is possible to give a mortgage to secure a debt without assuming personal liability for that debt." Slip Opinion at 836. This is precisely why I believe assumption of a mortgage does not also assume the underlying debt unless specifically stated.
The "mortgage indebtedness" is the indebtedness set forth in the mortgage. It recites a principal amount and it sets forth the manner in which that "mortgage indebtedness" is to be paid. The person assuming that mortgage indebtedness assumes only the mortgage obligation, not the underlying obligation which, in the mortgage, the mortgagor may have separately and independently agreed to pay. The obligations are certainly interrelated, but they are not identical. If the "mort gage indebtedness" and the obligation upon the underlying promissory note were one and the same, there would be no need to include in the original mortgage instrument a specific and severable promise upon the part of the mortgagor to "pay said note according to its terms". Slip Opinion at 4. Here, as in Warner v. Webber Apartments, Inc. (1980) 3rd Dist., Ind.App., 400 N.E.2d 1180, the original mortgagor agreed to pay, not only the mortgage indebtedness, but the underlying obligation as well. Without question, in Warner, as here, the *838original mortgagor was bound upon both obligations. That does not mean that a subsequent mortgage assumption carries with it both obligations and the Warner case does not so hold.
When Pendleton, in 1972, released all of the real estate from the 1968 mortgage, that release extinguished Hartles' obligation for the simple reason that the Har-tles' obligation was specifically tied to and was coextensive with the mortgage itself.1 Conceivably, and by some cireumstance, the Hartles may be obligated by virtue of the 1972 mortgage and/or upon the 1978 loan and mortgage. They are not, however, obligated upon the 1968 mortgage.
I am in total agreement with the concluding paragraph of the majority decision. A mortgage foreclosure action is not a condition precedent to a suit upon a promissory note. However, by emphasizing the "while at the same time" language of 1.0. 34-1, 58-7, a possible implication is created to the effect that if a court in a foreclosure action neglects to impose a personal deficiency judgment against the obligor, the lender, after foreclosure and sale of the real estate, may bring a new and independent action against someone who assumed the mortgage but not the underlying debt.
Without regard to any such implication, it is my view that First Indiana was not entitled to recover from the Hartles upon a debt not of their making, when a foreclosure action was precluded as a matter of law. Whether Vilesek remains obligated upon the underlying promissory note is not of moment. When the mortgage obligation was extinguished, Hartles' obligation to the Bank was also extinguished.
I would affirm the summary judgment.

. Perhaps the Bank was ill-advised to release the 1963 mortgage but it did so and is bound by the legal effect of that release. In this regard, in footnote 3, the majority notes that at or prior to this action, no effort was made to reinstate the 1963 mortgage as having been released by mistake. This very circumstance was clearly within the contemplation of the trial court and was specifically set forth in Conclusion 4. of the Summary Judgment. To the extent that the Hartles made payments upon the 1963 mortgage after the release, they may have been volunteers and barred from recovery of those amounts.