National Lumber Co. v. Canton Institution for Savings

The defendant bank foreclosed a first mortgage it held to secure advances under a construction loan, and the foreclosure sale yielded proceeds in excess of the amount secured by the mortgage. The bank commenced an interpleader action to determine the rights of other parties in the surplus and named, among others, the plaintiff. Despite receiving notice of the interpleader action, the plaintiff did not file an answer to the interpleader complaint until after a partial judgment had entered in that action and substantially all of the surplus had been paid *187to another creditor.1 Thereafter, the…