Barker v. International Bank

Citations

• 80 Ill. 96

Syllabus

<p>1. Deed oe trust—right of purchaser. The owner of land executed a note payable to his own order, and indorsed it and delivered it to another, and at the same time executed a deed of trust to secure its payment, for $25,000. The indorsee turned the note over to a banking house as collateral security for $14,000, borrowed of them by him. Before the maturity of the note, the party executing the deed of trust conveyed the land by genera] warranty deed tó A, for the consideration of $103,000, $78,000 of which was paid by canceling that amount of the indebtedness of the indorsee of the $25,000 note, and $25,000 more of such indebtedness was to be canceled when said note was paid, and the lien of the deed of trust given to secure it was removed from the land. When the $25,000 note became due, another bank, with which the indorsee of the note had an account, advanced the $14,000 which he had borrowed on the note, and took it as collateral security for the amount so advanced and for all indebtedness due to it from such indorsee, which exceeded the whole amount of the note: Held, on a bill to foreclose the deed of trust, that even if the note was accommodation paper,yet, as it was treated by the maker, at the time he conveyed to A, as a valid incumbrance on the land, his grantee, A, was in no position to defeat the lien, and that the bank had the right to foreclose the deed of trust for the full amount of the note, as against A.</p> <p>2. Interest—mode of computing. In rendering a decree for the amount due on a promissory note, it is error to compute interest on the note to the time of its maturity and add it to the principal, and then compute interest on the gross amount from the maturity of the note to the time of rendering the decree. The proper mode of computing interest is, when there have been no payments, to compute from the time the note begins to draw interest up to the time of rendering the decree.</p>