AMCAN FURS, INC., SAMUEL PORTNAY, RICHARD MACK, MURRAY WENIG, WILLIAM GREENBERG, WILLIAM WEINGARD AND LOUIS REITER, APPELLANTS,
v.
CENTRAL BANK AND TRUST COMPANY, A FLORIDA BANKING CORPORATION AND PAUL ROSENBLUM, AS CO-EXECUTORS UNDER THE LAST WILL AND TESTAMENT OF MAX ROSENBLUM, DECEASED, APPELLEES

Fla. 3d DCA | 1964-05-05
No. 64-108
Before CARROLL, HORTON and' HENDRY, JJ.
164 So. 2d 24 Florida District Court of Appeal, Third District (1964) Positive Treatment
Cited by 2 cases

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Synopsis

This interlocutory appeal challenges a trial court's decree regarding reimbursement rights in a trust holding real estate. The court affirmed the lower court's determination that certain beneficiaries who had advanced mortgage payments on behalf of other defaulting beneficiaries were entitled to reimbursement and liens against the trust property, even though they were no longer deemed owners of the trust.


Holding

The court held that the reimbursement provision was proper and did not violate the mortgage note's non-recourse clause. The advancing beneficiaries' rights arise from the trust agreement itself, not the mortgage note, and reimbursement is sought from the trust property rather than through personal judgment.


Key Quotes

“The parties seeking reimbursement are not enforcing the mortgage note but claim under the trust agreement which provided their right to reimbursement. Reimbursement is sought from the trust property (money), and not by personal judgment.”

Establishes the court's reasoning that reimbursement rights derive from the trust agreement, not the mortgage, and therefore the non-recourse mortgage provision does not apply.

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Facts & Procedural History

Real estate was held in trust with beneficiaries having varying percentage interests. The property was mortgaged with a non-recourse provision limitin…

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Opinion of the Court
CARROLL, Judge.

CARROLL, Judge.

This is an interlocutory appeal which challenges one provision of an order dealing with a trust.

Certain real estate was purchased and held in trust for a number of persons whose-percentage of beneficial ownership therein was varied. The property was mortgaged,, and there was a provision that the mort-*25rgagors would not be personally liable.1 The trust agreement required the beneficiaries 'to contribute, in proportion their interests, the amounts necessary to be paid on the mortgage from time to time, and upon failure of a beneficiary to do so another ■could advance the amount due from the former and be entitled to reimbursement and to a lien for enforcement thereof.2

The trust property was sold, and converted into cash in the net amount of $50,000. Prior to such sale certain of the beneficiaries had advanced mortgage payments which should have been made by ■others. The parties who made such advances for others were named beneficiaries ■of the trust at the time, but by the decree the chancellor held they were not entitled to ownership in the trust, and that the New York group was the owner of a 'hundred percent interest in the trust. How■ever, the decree added a provision that the •said parties who had made such advances for others, though declared to be no longer ■owners in the trust, were entitled to reimbursement from the trust property, that is, out of the money which then made up the corpus of the trust. That provision ■of the decree read as follows:

“5. The Estate of Max Rosenblum .-and The Drusin Group are creditors ■of the Tendler-Rosenblum Trust of 1956 by virtue of having paid mortgage interest and tax payments which were the obligation of the Tendler-Rosen-blum Trust of 1956. The Estate of Max Rosenblum and The Drusin Group are entitled to liens upon the entire corpus of the Tendler-Rosenblum Trust of 1956 in the amount of the mortgage and tax payments made by the said creditors on behalf of the Tendler-Rosenblum Trust of 1956.”

It should be noted that while thus declaring the rights of such parties to reimbursement in paragraph 5 of the decree, other provisions in the decree postponed a determination of the amounts due them and enforcement of their right to' reimbursement, and reserved jurisdiction to decide whether for other reasons their claims were barred in whole or in part.

The appellants contend that the quoted provision of paragraph 5 of the decree is erroneous. They argue it imposes a personal liability contrary to the provision of the mortgage note that it would be enforceable only against the mortgaged property. That argument is not sound. The parties seeking reimbursement are not enforcing the mortgage note but claim under the trust agreement which provided their right to reimbursement. Reimbursement is sought from the trust property (money), and not by personal judgment.

The appellants accepted the statement of facts and conclusions of law made by the chancellor in his decree, other than the said conclusion of law number 5, and for the reasons stated we find no error in the part of the decree singled out by appellants.

Affirmed.


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Citator

Cited By

  • Amcan Furs, Inc. v. Cent. Bank & Tr. Co., 179 So. 2d 128 (Fla. 3d DCA 1965)
    …PER CURIAM. This is the second appearance of this matter. On an earlier appeal (164 So. 2d 24) we affirmed a holding that certain parties who at one time were members of a trust were entitled to reimbursement out of the proceeds of the trust for advances they had made on their own behalf and for others. The subsequent proceedings in the tria…

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