196 Iowa 947 | Iowa | 1923
The action was commenced April 7, 1919, and notice of garnishment was served upon Shunick on the same day. The material facts are as follows: A written contract, signed by their respective agents, was entered into on April 1, 1919, by Armstrong and Shunick, by which the former agreed to convey to the latter a farm located in Fremont County, of uncertain acreage, for a consideration of $135 per acre, the exact acreage to be ascertained by survey and measurement, at Armstrong’s expense. The provision of the contract for the payment of the consideration was as follows:
“Two thousand dollars cash in hand, the receipt of which is hereby acknowledged. Grantee to assume a mortgage for $8,000.00 and interest thereon from date of delivery. Balance to be paid on delivery of deed and merchantable abstract of title.”
The contract further provided that Shunick should have possession immediately upon its execution. The principal defendant was never served with an original notice or with notice
Some time later, the date not shown, the defendant ten-, dered to Shunick a deed and abstract showing a satisfactory title, but refused to deliver the same to him until the full balance of the consideration was paid. The transaction was consummated upon that basis. .Shunick, as garnishee, on February 23, 1920, filed answer in the superior court, stating that he was in no wise indebted to the defendant; that he did not have in his possession, or under his control, any property of the defendant’s, and knew of no debts owed to him. On June 6, 1921, an amendment to his original answer, setting up the contract out of which the supposed indebtedness arose, together with the facts, substantially as stated above, was filed in the superior court. The answers of the garnishee were not controverted. On March 21, 1922, the court, upon motion of the plaintiff, entered judgment against the garnishee for the full amount of the judgment previously .entered against the original defendant, with interest thereon up to that date.
The briefs of counsel are elaborate, and cover every question that could arise upon the record; but, in view of the conclusion reached on the principal contention of appellant, that, as the garnishee was held, under the contract, only to a contingent liability, the debt was not subject to garnishment, we shall not consider the other propositions argued. It is elementary that the right of the plaintiff, as against the garnishee, in the absence of fraud, can rise no higher than the right of the
Counsel for appellee argue that the equitable title to the farm passed to Shunick, and that Armstrong retained the legal title only as security for the payment of the balance of the purchase price. Let it be conceded, for the purposes of this case, that the equitable title did pass, under the contract, to Shunick, yet payment of the consideration could not be enforced against him, even if every other requirement of the contract were complied with, until a deed conveying the farm to him, free and clear of all incumbrances except those assumed by him, together with an abstract showing a good, merchantable title, was tendered to him. The indebtedness did not become absolute until this was done. This conclusion is in harmony with the prior decisions of this court cited above, and with the general rule in other jurisdictions. Moreau River St. Bank v. Japinga, 37 S. D. 404 (158 N. W. 786); Becker v. Becker, 112 Wis. 24 (87 N. W. 830); Cowell v. May, 26 Mont. 163 (66 Pac. 843).
But two of the many cases cited by appellee need be given special mention. The contingency considered in Rankin v. Smith, 174 Iowa 537, affected only the maturity of the debt, and did not go to the debt itself. The obligation of the garnishee in that case was absolute and unconditional, but was to be paid only out of the proceeds of the sale of a farm, and then
Ottumwa Nat. Bank v. Norfolk, 185 Iowa 1334, involved a fund paid by the Modern Woodmen of America to the Phoenix Trust Company, in settlement of an action then pending against it upon a policy to be repaid to the insurance company in the event that the insured was located by the company alive at any time within ten years from the date of the contract. This fund was held subject to garnishment. The stipulation provided only for the maintenance of the status quo until it could be ascertained whether the beneficiary was dead. The action was based upon the presumption arising from seven years’ absence of. the insured.- The obligation of the trust company to pay the fund into court for the benefit of the beneficiary or the garnishee was absolute, in the absence of a definite showing by the insurance company that the insured was alive. The contingency involved only the performance of a condition subsequent. The holding in the above cases is not inconsistent with the conclusion here reached.
An order AAras entered by the court, directing service to be made by publication in the manner prescribed for the service
As stated above, no notice of the garnishment was served upon the defendant, but judgment was entered against him in the main action upon the stipulation signed by the parties and filed in the superior court. The defendant refused to consummate the sale by the delivery of a deed and abstract, except upon payment of the full balance of the purchase price to him. The payment thereof was made under these circumstances. This is shown by the amended answers of the garnishee. 'The only ground upon which prejudice could result from a reversal would be the failure of the defendant or his estate to compel a double payment by the garnishee of so much of the purchase price of the farm. The reversal of the judgment in the court below will do nothing more than to restore the status as it existed before judgment was entered against the garnishee. The defendant’s estate may be liable for the payment of the judgment, but this will result in no hardship, for the reason that it has already received full payment of funds garnished. The defendant manifestly acted in bad faith in dealing with his daughter-in-law, and also in demanding full payment of the purchase price as a condition precedent to the delivery of the deed and abstract to Shunick. It was not, under the facts disclosed, the duty of the garnishee to secure the appointment of an administrator of the estate in Iowa, upon whom notice of appeal might be served. The motion to dismiss is overruled.
It follows that the judgment of the court below must be and is — Reversed.