Marine Management v. Seco Management

DECISION & ORDER In the case at bar, the defendant Seco Management, Inc. (hereinafter Seco), executed a mortgage in favor of the plaintiff's predecessor in interest in order to secure an indebtedness in the principal sum of $1,300,000. Pursuant to the terms of the mortgage, Seco was to pay interest at the ""prime rate"" plus 3 1/2%, but in no event was the rate of interest to be lower than 13%. However, the mortgage separately provided that in the event of a default, Seco would pay interest ""at the maximum rate permitted by law"" from the date of the default until ""the date of the actual receipt of payment * * * by the holder of this mortgage"". After Seco had defaulted in its mortgage payments, the plaintiff's predecessor in interest obtained a judgment of foreclosure against Seco dated February 11, 1988, which incorporated the computations of a court-appointed referee. The referee's report had established that the total sum due on the mortgage, including accrued interest calculated at the mortgage default rate of 25% per annum, through the date of computation December 31, 1987, was $1,811,874.98. The judgment further provided that interest should accrue on this sum from December 31, 1987, ""pursuant to the terms of said mortgage"".