Comet Development Corp. v. Prudential Insurance Co. of America

District Court of Appeal of Florida

Comet Development Corp. v. Prudential Insurance Co. of America

579 So. 2d 355, 1991 Fla. App. LEXIS 4569, 1991 WL 76266

District Court of Appeal of Florida·Decided May 14, 1991·No. No. 90-490·Published

Opinion

GERSTEN, Judge.

Appellant, Comet Development Corp., appeals a final summary judgment. We affirm.

A construction mortgage is usually obtained for the purpose of financing construction. In a construction mortgage, the mortgagee retains the proceeds of the mortgage and assumes the duty to pay for materials and supplies for work done. Security and Investment Corporation of The Palm Beaches v. Droege, 529 So.2d 799 (Fla. 4th DCA 1988).

The mortgage in this case was a first mortgage on an existing office building. Appellee did not assume any duty to disburse the funds for any work done. Further, even where a construction mortgage is involved, the duty to disburse the funds with reasonable care is owed to the owner. Kalbes v. California Federal Savings and Loan, 497 So.2d 1256 (Fla. 2d DCA 1986). Accordingly, if appellee owed any duty, it [356]*356was to the owner of the building, not appellant contractor.

Affirmed.

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GERSTEN, Judge.

Appellant, Comet Development Corp., appeals a final summary judgment. We affirm.

A construction mortgage is usually obtained for the purpose of financing construction. In a construction mortgage, the mortgagee retains the proceeds of the mortgage and assumes the duty to pay for materials and supplies for work done. Security and Investment Corporation of The Palm Beaches v. Droege, 529 So.2d 799 (Fla. 4th DCA 1988).

The mortgage in this case was a first mortgage on an existing office building. Appellee did not assume any duty to disburse the funds for any work done. Further, even where a construction mortgage is involved, the duty to disburse the funds with reasonable care is owed to the owner. Kalbes v. California Federal Savings and Loan, 497 So.2d 1256 (Fla. 2d DCA 1986). Accordingly, if appellee owed any duty, it [356]*356was to the owner of the building, not appellant contractor.

Affirmed.

Comet Development Corp. v. Prudential Insurance Co. of America, 579 So. 2d 355, 1991 Fla. App. LEXIS 4569, 1991 WL 76266 (Fla. Ct. App. 1991).

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Opinion

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