79 Fla. 34 | Fla. | 1920
This is au appeal from an order overruling a demurrer to a bill to enforce a mortgage lien.
The bill in substance alleges that Leila I. Brooks and lier husband, J. B. Brooks, on the 19th day of September, 1912, were indebted to the First National Bank of Gaines-ville in the sum of $3,200.00 for whi ch they executed and delievered to the. bank their promis sory note payable in ninety days, and executed a mortgage upon a certain lot in Gainesville to secure the payment of the note. That on the 10th day of December, 1912. the bank, acting for Leila I. Brooks and her husband, sold the mortgage property to TV. R. and TV. T. Cheves for the sum of $2,000.00, and Leila I. Brooks and husband executed a deed therefor to TY. R. and TV. T. Cheves; that they did not pay cash for the property, but on December 12, 1912, entered into an escrow agreement with the bank whereby the deed from Brooks to Cheves was to be held by the bank, together with two promissory notes for $1,000.00 each, of TV. R. and TV. T. Cheves. — the deed to be delivered by the bank when the notes were paid. The escrow agreement was in the following language:
“ESCROW AGREEMENT.
State of Florida,
Alachua County.
“It is agreed by and between the First National Bank of Gainesville, a corporation under the laws of the United States, on the one part, and W. R. Cheves and W. T. Cheves. partners, trading in Alachua County, Florida, under the firm name and style of Cheves Brothers, on the other part, WITNESSETH: That, Whereas the First National Bank holds a mortgage covering a certain lot, piece, tract or parcel of land, situated, lying and being*36 in the City of Gainesville, Alachua County, Florida, owned' by Inez Brooks and J. B. Brooks, her husband, and a mortgage covering all of the property of the Gainesville Bottling Works, a corporation; and WHEREAS, the said L. Inez Brooks and husband have this date made and executed to the said Cheves Brothers a Warranty Deed covering the said real estate and the said Gainesville Bottling Works has executed to the said Cheves Brothers a Bill of Sale covering the said property owned by it, but have not delivered the said Deed or the said Bill of Sale; it is therefore agieed, that the said Deed and Bill of Sale shall be held by the said Bank until'the payment of a certain indebtedness due by the said Cheves Brothers to the said Bank, as evidence by two certain promissory notes for One Thousand Dollars cash and payable one and two years from date hereof, with 8 per cent, interest, payable semi-annually. It is further agreed that in the event the said notes, or the said interest, or any part of said notes or interest, is not paid at maturity, then in that event, the said Bank shall have the right to proceed to enforce its right under the said mortgages now held against said property, and this agreement shall become null and void. It is further agreed, that if at any time said notes, are paid, either before or at maturity, then the-said deed and Bill of Sale are to be delivered to the said Cheves Brothers or their heirs or assigns.
“At Gainesville, Florida, this the 12th day of December, A. D. 1912.
THE FIRST NATIONAL BANK,
OF GAINESVILLE,
By LEE GRAHAM, Cashier.
W. R. CHEVES,
W. T. CHEVES.”
A demurrer to the bill was interposed by J. C. Adkins upon thirteen grounds. Those argued are that the bill does not show that he had any notice of the existence of the escrow agreement; nor that the judgment creditors had notice of such agreement, nor that they had notice of the mortgage from W. R. and W. T. Cheves to the bank; that the bank was not the vendor of the property and 'so has no lien for the purchase price; that the bill shows no right or lien or interest in the bank under the mortgage from Brooks; that the bill shows the notes for |1,000.00 each made by W- R. and W. T. Cheves have been paid, and that the alleged escrow agreement was performed and carried out; that the allegations of the bill are contradictory; that the bill is defective because Leila I. Brooks and husband are necessary parties and are not made parties, defendant to the bill of complaint; that the bill is multifarious and without equity.
This demurrer was overruled, and the defendants appealed.
The bill of complaint is based upon the right to enforce the mortgage'lien against W. R. and W. T. Cheves in favor of the bank for the purchase price of the land.
The note for $1,335.00 made by W. R. Cheves and W. T. Cheves to the bank on November - 6, 1917, and to secure which the mortgage was given was a mere renewal of one of the purchase money notes with interest. This renewal note did not change the character of the original debt as one for the purchase money of the land. The execution of a note in renewal of a previous one is not a payment of such prior note, nor the creation of a new indebtedness unless there is an express agreement to that effect by the parties. See Griffin v. Long, 96 Ark. 268,
We are not concerned' with the debt of Leila I. Brooks and husband to the bank. It is only important that they consented to the execution of the deed to W. R. and W. T. Oheves and the payment of the price demanded for the land to the bank. Now the socalled agreement in escrow, was nothing more than an agreement between the purchaser and vendor, or one who stood in place of the vendor, that , there should be no delivery of the deed until the payment of the purchase price, that is to say the de'ed should not. be executed until the money was paid. We can conceive of no possible legal objection to W. R. and W. T. Oheves making that kind of an agreement. The prudence of it might be open to some doubt if the transaction had been larger, and the vendor, or one in his place, irresponsible; but the bank in this case possibly had earned the confidence of the vendees and the transaction was small. The terms of this agreement seem later to have been altered by the mutual will and desire of the parties thereto. As no one else was concerned and had no legal right to complain, and the change was not for an unlawful purpose, it was validly effected. Gunby v. Drew, 45 Fla. 359, 34 South. Rep. 305. It amounted to this: While W. R. and W. T. Oheves were not to get a deed' to the place until all the purchase price was paid, the deed should be delivered at once if a mortgage to secure the balance of the purchase price remaining unpaid should be given. As there was no possible legal objection to this agreement it was entered into. It did not affect the rights of the creditors. Their judgments were not liens upon the land' before W. R. and W.
That a mortgage for the purchase price of land executed at the same time that the deed therefor is executed' so that they form one transaction constitutes a superior lien to that of judgments obtained against the vendee prior thereto is generally conceded, and, of course, the-superiority of the lien is not lost by diligence in procuring an early record of the mortgage. See 1 Jones on Mortgages, 469; Marin v. Knox, 117 Minn. 428, 136 N. W. Rep. 15. A mortgage to secure the purchase money given by a purchaser of land simultaneously with the conveyance of the laird to him, does not necessarily lose the character of a purchase money mortgage merely because taken in the name of a person other than the vendor by the vendor’s procurement. See Albright v. Lafayette Building & Savings Ass’n, 102 Pa. St. 411; Cowardin v. Anderson, 78 Va. 88; Carey v. Boyle, 53 Wis. 574, 11 N. W. Rep. 47; Van Loben Sels v. Bunnell, 120 Cal. 680, 53 Pac. Rep. 266; Protestant Episcopal Church of the Diocese of Ga. v. E. E. Lowe Co., 131 Ga. 666, 63 S. E. Rep. 136.
What has been said disposes of the case, and it is therefore unnecessary to discuss other assignments of
The decree of the chancellor should therefore be and is hereby affirmed.