Crowe v. Covington count on financial Co. Appeal from Kenton routine legal; common-law and Equity Division.

Crowe v. Covington count on financial Co. Appeal from Kenton routine legal; common-law and Equity Division.


Rodney G. Bryson, Judge.

Sawyer A. Smith for appellant.

Rouse, Rates Adams for appellee.


The appellant, J.M. Crowe, is the master of 5/20 (1/4) with the inventory regarding the Barrington forests Realty providers, a business, hereinafter called the realty company. On March 22, 1922, the realty company lent of appellee, The Covington believe and financial providers, hereinafter known as lender, the sum of the $13,000 evidenced by thirteen $1,000 records payable on or before 36 months after go out, and guaranteed exact same by an initial financial from the house of this realty providers. Before the loan got consummated, as well as the financial in the house, the stockholders from the realty business, such as appellant, performed and shipped to the financial institution listed here crafting:

«This Agreement Witnesseth:

«That, while, The Barrington forest Realty business, an organization within the regulations for the county of Kentucky, was desirous of obtaining from The Covington benefit Bank and rely on team, of Covington, Kentucky, financing from inside the sum of $13,000.00, mentioned loan as secured by a mortgage on property of said Realty providers in Kenton County, Kentucky, and

«while, the said Covington benefit financial and rely on business is actually ready to making said mortgage, supplied the stockholders of said Realty providers consent in writing into the delivery of home loan securing stated mortgage, and additional agree to indemnify mentioned cost savings financial and rely on Company against any reduction, price or costs by factor from the generating of said mortgage;

«today, for that reason, in consideration regarding the creating of said financing by said benefit Bank and believe team to said Realty business, the undersigned, getting most of the stockholders of said Realty team, manage hereby consent into the performance of said home loan and additional agree to hold the said The Covington discount lender and confidence team as well as benign from any control, expense or cost that could develop by cause for the giving of said financing, stated assurance being in amount towards holdings on the a few stockholders in said Realty organization, the following:

After records matured on March 22, 1925, they were not settled or revived and obviously little is complete about the situation until on or around March 25, 1929, where energy, with no participation or actions for appellant, others stockholders associated with realty team as well as the lender made a settlement in regards to the notes performed in 1922 alongside matters. The result of the payment was that the realty organization accomplished into the lender ten $1,000 latest notes due and payable 3 years from go out, or March 25, 1932, and terminated or noted settled the outdated notes, and the financial which had been provided by the realty organization to secure the outdated records symbolizing the 1922 $13,000 loan was launched by lender inside margin for the financial book in which it had been recorded in the office on the Kenton state courtroom clerk, additionally the realty organization executed into the financial an innovative new mortgage on their property to lock in the installment of the $10,000 new notes executed March 25, 1929, which financial was properly recorded inside the district courtroom clerk’s company.

Once the ten $1,000 notes accomplished on March 25, 1929, developed on March 25, 1932, no efforts was made from the bank to gather the notes by foreclosure process on the mortgage or else and apparently nothing is done regarding the issue until 1938 whenever bank charged the realty organization to gather the $10,000 mortgage made in March, 1929, also to foreclose the financial performed from the realty organization to protect the repayment of the same. Wisdom is rendered in favor of the financial institution in addition to mortgaged belongings bought marketed to fulfill the judgment, interest and value, etc., that has been accomplished, but at that time the assets with the realty team are insufficient to satisfy the judgment as well as the lender recognized merely a little element of the debt, leaving an equilibrium of $8,900 unpaid. In 1940 the bank brought this action against the appellant claiming that the $10,000 loan made by it to the realty company in 1929 was only a renewal or extension of the original $13,000 loan made in 1922 and sought to recover of appellant 5/20 or 1/4 of the $8,900, or $2,225, deficit which was appellant’s proportionate share of the original $13,000 loan made in 1922 under the writing signed by appellant in 1922 in connection with the original loan.

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