Court Opinion

ID: 9661230
Source: CourtListenerOpinion
Date Created: 2023-08-23 22:33:10.801671+00
Date Added: 2024-06-11T18:14:26.552324
License: Public Domain

D. E. Holbrook, J.
(concurring in part, dissent*729ing in part). This writer concurs in the majority’s discussion of the law applicable in the instant case. However, this writer cannot concur in the result achieved herein. There is no need to carve out an equitable exception in the instant case in order to give defendant the benefit of its mistake. Defendant mortgage company should not have foreclosed this mortgage after fire had destroyed the premises when insurance money was available to pay the amount due on the mortgage.
The proper rule applicable herein is that if the sequence of events is that the fire occurs before the foreclosure the mortgagor is entitled to all of the insurance proceeds, majority opinion page 726, Whitestone Savings & Loan Association v Allstate Insurance Co, 28 NY2d 332; 321 NYS2d 862; 270 NE2d 694 (1971). There is no direct Michigan authority on this point. Nevertheless, there was sufficient authority in other jurisdictions which should have put defendant on notice. Northwestern National Insurance Co v Mildenberger, 359 SW2d 380 (Mo App, 1962), Insurance Co of North America v Citizens Insurance Co of New Jersey, 425 F2d 1180 (CA 7, 1970). Furthermore, this rule is dictated by common sense, majority opinion at 725, citing Whitestone, supra. The mortgage company should not be entitled to plead ignorance to their advantage "over the individual mortgagor plaintiffs herein. This is a case of first impression in Michigan and defendant therefore is entitled to some consideration. The proper relief which should be granted is to set aside the foreclosure and place the parties in the same position as had their expectations and intent been carried out. Under this approach, plaintiffs would receive title to the property and the surplus of the insurance proceeds. The defendant would receive the amount *730outstanding on the mortgage at the time of the fire loss, the proper time for such determination. This is approximately the same outcome as that reached by the majority opinion. However, the majority opinion also allows the defendant approximately $1,000 in foreclosure costs and attorney’s fees.1 This writer cannot concur with such a result. The foreclosure was, in reality, improper. Both parties knew the property was properly insured for the benefit of the mortgagee.2 There was no necessity for this foreclosure when defendant knew insurance proceeds were available. There is no evidence or allegation of bad faith on defendant’s part, however, this foreclosure was clearly improper and should be corrected by this Court. Nevertheless, plaintiffs herein should not be penalized for defendant’s improper action. To allow defendant to still be entitled to the proceeds of insurance in spite of having foreclosed on the mortgage and in addition to charge plaintiffs for the costs of foreclosing the mortgage is unjust. Even placing the parties in a position whereby the foreclosure is ignored is giving the defendant considerable benefit of doubt, but going one step further and charging plaintiffs with the cost of foreclosure is, in this writer’s opinion, unjust.
This writer concurs in the majority’s opinion vacating the order of the trial court, but must respectfully dissent from that part of the opinion directing judgment below. This writer so votes.

 The amount owing on the mortgage was approximately $13,000. However, the majority opinion authorizes payment of $13,961 to defendant, the difference constituting foreclosure costs and attorney’s fees. See majority opinion, pp 722 and 728.

 It is not hard to see why a layman would think that his obligation to continue mortgage payments ceased upon destruction of the property when he knew that the mortgage provided for the mortgagee to receive insurance proceeds which were more than sufficient to pay the amount owing on the mortgage.