Opinion
No. 80-563.
Opinion Filed: February 17, 1981.
APPEAL from a judgment of the circuit court for Waukesha county: FRANCIS H. WENDT, Reserve Judge, presiding. Affirmed.
Before Voss, P.J., Brown and Scott, J.J.
Burlington Marine Bank (the Bank) obtained a mortgage foreclosure judgment against Donald E. Wieselmann, Carolyn B. Wieselmann, Arthur Wieselmann and Mayme Wieselmann involving property located in the city of Muskego, Waukesha county, Wisconsin. Only Donald E. and Carolyn B. Wieselmann appeal. Because the Bank's actions were consistent with the note and mortgage executed by the Wieselmanns and because the Bank did not waive any default and is not estopped from seeking a foreclosure judgment, we affirm.
On November 2, 1977, the Wieselmanns executed a mortgage note and mortgage to the Bank providing for a principal loan of $70,000 financed at 9% per year with monthly payments of $564.32 due on the first day of the month beginning December 1, 1977 and continuing until November 1, 1982, when a balloon payment consisting of the unpaid principal balance and accrued interest would be due. The Wieselmanns failed to make their monthly payments in February and March of 1979. By letter dated March 29, 1979, the Bank declared the note in default, demanded payment in full of the obligations, set forth the principal balance and interest due and increased the interest to the default rate of 11.75%.
In April 1979, the Wieselmanns made three payments of $563.24 each. The Bank applied the payments to the accrued interest calculated at 11.75% and on May 3, 1979 commenced the foreclosure action. The Wieselmanns represent that they have continued to make monthly pay-ments of $563.24 during these proceedings.
The Bank had the right to accelerate payment under the note and to foreclose its mortgage when part of the debt became due and remained unpaid for ten days. See generally Scheibe v. Kennedy, 64 Wis. 564, 567, 25 N.W. 646, 647 (1885). The note provides:
If the maker(s) fails to make a payment under this Note when due, and the default continues for 10 days, or upon the occurrence of an event of default described in the mortgage, the holder may declare the entire balance of principal and accrued interest to be payable immediately, with-out notice or demand. All payments shall be applied in such manner as the holder determines to interest, principal and payments due under the mortgage.
The mortgage provides:
10. Default; Acceleration; Remedies. If, (a) there is a failure to make a payment under the Note when due and such default continues for a period of ten days, . . . the Note will, at the option of Lender and without notice, which is hereby waived, be payable immediately, and Lender may collect the same in a suit at law or by foreclosure of the Mortgage by action. . . .
By letter of March 29, 1979, the Bank demanded payment of the entire balance of the principal and accrued interest. The Wieselmanns contend that by making the three installment payments in April and monthly payments thereafter, the foreclosure action should have been dismissed pursuant to sec. 846.05, Stats. Section 846.05, Stats., provides, in relevant part:
An action for the foreclosure of a mortgage upon which there shall be due any interest or any installment of the principal and there shall be other installments to become due shall be dismissed upon the defend-ant's bringing into court, before judgment, the principal and interest due, with the costs. . . .
When the Bank commenced the foreclosure action, the entire balance of the principal and accrued interest was due, not merely several installments of principal and interest. Payment of the missed installments is sufficient to obtain a dismissal of the foreclosure action only when that is the part of the mortgage debt due when the foreclosure action is commenced.Cf. Manning v. McClurg, 14 Wis. 379 (1861). Here, however, the Wieselmanns could only have obtained a dismissal by paying the entire balance of the unpaid principal and interest.
The Wieselmanns also contend that the Bank could not impose the 11.75% interest. The note provides:
All unpaid principal and accrued interest shall bear interest after maturity of this Note, whether occurring through lapse of time or acceleration, at the rate of 11.75% per year until paid. [Emphasis added.]
As acceleration occurred, the Bank was empowered by the note to impose the 11.75% per year interest rate.
The Wieselmanns further contend that the Bank waived its right to seek foreclosure by accepting the Wieselmanns' payments after its letter of March 29, 1979. The Bank, however, has the right to accept any payments made and to apply those payments in its discretion to interest, principal and other payments due, as clearly provided in the note quoted above.
The Wieselmanns further argue that the Bank must be estopped from conducting a sheriff's sale. Luther Carr, the Bank's assistant vice president, testified that he made an agreement with Mr. Wieselmann to the effect that should Mr. Wieselmann maintain payments up to the date of a sheriff's sale, the Bank would not continue with the sale. In a letter to the Bank's counsel, Mr. Carr wrote, "It was agreed foreclosure action would be allowed to continue, however a Sheriffs [sic] Sale would not ultimately occur if during the time spectrum all the legal action takes, Mr. Wieselmann [sic] maintains his mortgage properly and clears all tax liens on the property." No sheriff's sale has been noticed. The Wieselmanns' estoppel argument is premature.
The Bank alleged in its complaint that taxes had not been paid for 1977 and 1978. Over objection, the trial court allowed the introduction of a title report dated April 17, 1979 showing a state income tax lien filed January 19, 1978 and real estate taxes due for 1977 and 1978. The trial court found the allegations of the complaint to be true. Claiming the report is hearsay and stale, the Wieselmanns maintain there is insufficient evidence to support this finding. Inasmuch as separate and independent grounds existed for foreclosure, we need not consider this issue. If the taxes are paid, the portion of the judgment calling for payments of delinquent taxes to redeem would be mere surplusage.
Finally, the Wieselmanns argue that there is no evidence to support the trial court's award of attorney fees of $1,600. This issue is being raised for the first time on appeal. We decline to consider the issue for that reason.Allen v. Allen, 78 Wis.2d 263, 270, 254 N.W.2d 244, 248 (1977).
By the Court. — Judgment affirmed.
Not recommended for publication in the official reports.