Opinion
No. 2046.
August 8, 1962.
Appeal from the Circuit Court, Broward County, Richard M. Sauls, J.
Ray Sandstrom, Sandstrom Hodge, Fort Lauderdale, for appellants.
Joseph Varon and Steven Loveland, Hollywood, for appellee.
Appellants, defendants below, seek the reversal of a summary final decree in a chattel mortgage foreclosure suit. After plaintiff filed his amended complaint for foreclosure and before answer, plaintiff moved for a summary decree, supported by affidavits. One of the defendants had been deposed and his deposition is in the record. The hearing on plaintiff's motion for summary decree was held on May 2, 1960, and at said hearing defendants filed their affidavit in opposition, setting forth novation. The motion was denied. Defendants then answered, alleging novation and contending that since a novation had been agreed to there was no valid note or mortgage in existence. Plaintiff's renewed motion for summary decree, supported by affidavit, was subsequently granted and final decree of foreclosure rendered thereon. The point for determination on this appeal involves the propriety of this summary decree in view of the plea of novation raised in the answer. The question presented is: Whether the allegation of novation in the answer created a material issue of fact so as to preclude entry of summary judgment.
If this question is answered affirmatively, then the question of whether or not the affidavit in opposition to appellee's first motion for summary decree was timely filed, becomes moot.
At the outset it may be stated as well settled that a summary decree is proper where it appears that there is no genuine issue as to any material fact, and that, as a matter of law, the moving party is entitled thereto. See Rule 1.36(c), F.R.C.P., 30 F.S.A. The converse is equally well established in Florida.
As noted above, plaintiff-appellee first moved for summary decree prior to the filing of defendants' answer. After answer, the motion was renewed. Rule 1.36(a), provides that a claimant may move for summary judgment or decree in his favor any time after the expiration of twenty days from the commencement of the action. Although the motion was not granted until after answer, the case of Olin's, Inc. v. Avis Rental Car System of Florida, Fla. App. 1958, 105 So.2d 497, holds that a trial court should not grant a motion for summary decree filed before the defendant has answered, unless it is clear that an issue of material fact cannot be presented.
It is apparent from the briefs of both parties that defendant-appellants' affidavit in opposition to summary decree was not filed until the date set for the first hearing on the motion. The motion was denied and the defendants answered. Said affidavit and defendants' answer, however, both set up novation.
There is no mention in either brief of appellants filing an affidavit in opposition to appellee's renewed motion for summary decree. Nevertheless, the chancellor had before him the amended complaint, answer, and deposition of one of the defendants, in addition to, if it was considered, the affidavit filed earlier by defendants in opposition to plaintiff's first motion for summary decree.
Appellee argues that the chancellor ruled on the theory of novation as a matter of law adversely to the appellants. He then argues the merits on the plea of novation and says that there was no novation here. Appellee thus attacks on this appeal the genuineness of the issue of novation. As was said in Messina v. Baldi, Fla.App. 1960, 120 So.2d 819, the purpose of a summary proceeding is not to resolve conflicting issues of fact, but to ascertain and determine whether or not genuine issues of material fact exist. If such facts are shown to exist, the motion should be denied. Hence, in the instant case, in ruling on the renewed motion for summary decree, the chancellor apparently decided that no genuine issues of fact existed.
In 30 Fla.Jur., Summary Judgment, § 11, the following is stated at p. 350:
"In order to defeat a motion for summary judgment and force a trial of the case, the party opposing the motion must show a genuine issue. The trial court is permitted, with the evidence before it, to pierce the shield of the pleadings in search of a proper issue. It may inquire into the qualitative substance of any pleading, whether filed in good or bad faith. * * *"
For a good discussion of this question see Humphrys v. Jarrell, Fla.App. 1958, 104 So.2d 404, an opinion written by Judge Kanner of this court.
The question remains of whether the answer of the defendant-appellants raised a genuine issue of fact on the issue of novation. The determination of this question is controlled by the pronouncement of the Florida Supreme Court in Chereton v. Armstrong Rubber Co., Fla. 1956, 87 So.2d 579, wherein it held:
"The defendant's answer to plaintiff's complaint raised an issue of fact that was not met by plaintiff's affidavit in support of its motion for summary judgment. So, regardless of the insufficiency of defendant's counter-affidavit, there remained a genuine issue of fact which should have been tried by a jury."
In our review of the record on appeal we find that the decision of the trial court resolved a factual controversy by choosing an inference from the matters before the court in favor of the appellee's motion for summary final decree, while inferences contrary to those selected could have reasonably been drawn.
Under these circumstances we find that disposition of this suit by summary decree was not proper.
The summary final decree is therefore reversed and the cause is remanded to the trial court for further proceedings not inconsistent herewith.
Reversed.
KANNER, J., concurs.
ALLEN, Acting C.J., concurs specially.
While I concur in the decision of Judge HALL and its rationale, under the peculiar circumstances of this case I deem it necessary to amplify the facts for the guidance of the chancellor inasmuch as the cause is to be remanded for further proceedings.
Plaintiff sold certain equipment to defendant for $15,000. The sum of $1,500 was paid in cash and the balance was evidenced by two notes of $2,500 and $11,000, respectively, secured by a chattel mortgage.
Thereafter, the indebtedness being in default, the parties agreed to an adjusted indebtedness of $4,050. When defendant failed to pay said adjusted amount, plaintiff, after making demand, brought suit to foreclose the chattel mortgage for $4,050 plus interest, attorneys' fees and costs as provided in the notes and mortgage.
In the amended complaint, plaintiff states that the necessity for adjusting the mortgage indebtedness down to $4,050 was occasioned by defendant's inability to make payments and that said adjustment was accomplished by both plaintiff and defendant selling off some of the inventory that was included in the original sale.
In the answer, defendant admits that the indebtedness was adjusted to $4,050 but ascribes different reasons therefor which it contends rendered said adjustment a novation vitiating in toto the original two notes and the mortgage securing them. These reasons are that plaintiff did not make delivery of equipment in the quality and quantity called for in the original sale and that some of the items purportedly sold to defendant by plaintiff were not the property of the plaintiff. Defendant further averred that the adjusted amount owing on the equipment was agreed on by the parties as a result of negotiations amounting to a new contract which extinguished the previous contract evidenced by the aforementioned two notes and mortgage and further provided for purchase of equipment by defendant from plaintiff of newly determined quantity and quality.
Defendant's president testified in his deposition that the amount owing was $4,050 as prayed for in the complaint, so in this regard the parties are agreed. By its plea of novation, however, defendant seeks to avoid the provision in the notes and mortgage for 8% interest and attorneys' fees. In the prayer of its answer, defendant asked that the complaint be dismissed, or, in the alternative, that the cause be transferred to law as an action in debt.
In this case defendant's plea of novation, in effect, challenges the jurisdiction of the equity court to try the dispute, for if this plea ultimately prevails there would be no valid mortgage on which to predicate equity's foreclosure jurisdiction.
There only appears to be one disputed fact issue and this has been determined not to involve the amount of the indebtedness. Said issue springs from the varied reasons ascribed by the respective parties for reducing the amount owed on the original sale contract.
Under plaintiff's version (defendant's inability to make payments) it is perhaps true that no novation took place and that the adjustment of the indebtedness down to $4,050 amounted to no more than a partial satisfaction of the mortgage with said amount continuing to be due thereunder.
Under defendant's version, however, (plaintiff's failure to perform as called for by original agreement) a novation in respect to the sale contract could have, in fact, taken place.
From the two foregoing paragraphs it appears that there is an issue of fact on the issue of novation which, under the circumstances of this case, challenges the jurisdiction of the lower court.
By way of speculation, assuming a novation arguendo, the parties may well have agreed to leave the existing notes and mortgage as security for the newly agreed on indebtedness. If, as defendant contends, a new contract of sale of chattels of varied quantity and quality from the original contract took place, it is reasonable to assume that plaintiff vendor would have desired the same type of security that he bargained for in the original sale. That no new note and mortgage were drawn up at least raises an inference that the parties intended the original notes and mortgage to stand over as security for the second transaction. This inference would be a fairly strong one were evidence adduced to show that the items actually received by defendant, after the purported novation, were still accurately described by portions of the inventory attached to the note and mortgage, notwithstanding that said items may have been of different "quality and quantity" that contemplated in the original sale agreement.
It does not appear, however, that such considerations were properly before the chancellor and that material issues remain unresolved in the instant cause going to both the fact and effect of a novation.
In view of the foregoing, I concur in the opinion of the majority and the conclusions of law contained therein.