138 Iowa 631 | Iowa | 1908
The controversy in this case involves a question of application of payments. The evidence tends fairly to establish the following facts: On January 8, 1897, the defendants, or one of them, being indebted to the plaintiff in the sum of $505, made and delivered to him their two promissory notes aggregating that sum, together with the chattel mortgage in suit, which recites that it is given to secure the payment of the mortgage debt by the said Louis Vogt. In February or March, 1897, Vogt having been sued for the rent of a farm occupied by him, and his property being seized under a landlord’s attachment, plaintiff at his request made settlement of the landlord’s claim by advancing the sum of $342, on payment of which the rent notes were delivered to him. Thereafter, and during the period beginning August 20, 1897, and ending September 19, 1902, a series of payments, ranging from $20 to $140 each, and aggregating $846.66 was made to the plaintiff. Of these the first four payments, made August 20, 1897, $140, September 8, 1897, $115, September 14, 1897, $50, and December 7, 1897, $75.80, aggregating $380.80, he applied to the satisfaction of the rent notes above mentioned. Thereafter he indorsed upon the notes in suit payments as follows: March 27, 1899, $71.50, July 22, 1899, $80, May 9, 1901, $100, March 24, 1902, $100, and September 19, 1902, $20. The defendants also claim to have made a single payment of about $400, but the evidence shows quite sat
It is also alleged by the defendants in their answer that, in making these payments, they directed that the same be applied to the notes secured by the mortgage, but the allegation is not sufficiently sustained by the testimony. Neither defendant so swears. The husband does state in general terms, or by way of conclusion, that the payments were made on the notes, or to be applied on the notes and mortgages, but there is no evidence that either of the defendants ever directed such application to be made. The fact that some of the receipts given by the plaintiff expressly acknowledge payments “ on notes ” is not inconsistent with their application upon the rent notes. It was shown, however, that the payments were nearly or quite all made from the proceeds of sales of property included within the mortgage, and it is argued for the appellant with much persistence that, because of this fact, appellee was in duty bound to apply the moneys so received to the satisfaction of the mortgage. In support of this claim it is said that the mortgage debt is the joint
Nor does the fact that the wife was a surety upon the mortgage debt, and not upon the unsecured debt, deprive the plaintiff of his right to apply the payments received to the latter, in the absence of any direction to credit them upon the former. Indeed where but one of the debts is secured, and payments are made of which neither'the cred
Eules which bind the mortgagee who sells upon foreclosure, or takes possession of and sells and converts the security, have little application to a ease where the payment is made from money obtained by a voluntary sale by the mortgagor. In the latter case the lien of the mortgage does not follow or attach to the money, and the mortgagee has no recourse upon any other person to whom such moneys may be paid. In the hands of the mortgagor they have no different character than moneys derived from a wholly different source; and when paid over to the mortgagee in the absence of agreement or direction as to their application, the latter has the right to credit them upon the unsecured debt without regard to the source from which they were obtained by the debtor.
The decree of the district court is affirmed.