54 Iowa 505 | Iowa | 1880
1. The note due in three years was given xq) by plaintiffs, and a note therefor, and for the interest due on the. notes, was executed May 3, 1873, by Ammon, Scott & Co., for $3,860, payable on demand, with interest at ten per cent and attorney’s fees.
3. On the 18th day of December, 1874, these two demand notes were surrendered, and a receipt of payment indorsed oh. the back, and for the same Ammon, Scott & Co. executed to Henry Heively a demand note for $6,825.23, with interest at ten per cent payable semi-annually and attorney’s fees.
4. On the 7th of May, 1875, the foregoing demand note, and also the note for $2,500 payable in five years, were surrendered and canceled, and for them Ammon, Scott & Co. executed to Henry Heively their demand note for $6,993.93, with interest at ten per cent payable semi-annually and attorney’s fees.
5. On the 4th of May, 1876, the above demand note, and the note for $2,500 payable in six years were given up and canceled, and in lieu thereof were executed by Ammon, Scott & Co., a note for $1,000, payable to Emma Gaston, one certificate of deposit No. 673, for $4,000.00, one certificate of deposit No. 674, for $2,436.54, and one certificate of deposit No. 675,. for $2,437.54, all payable to Henry Heively, with interest at ten per cent, payable semi-annually. The note to Emma Gaston was subsequently taken up and a certificate of deposit given to her therefor.
6. Certificate of deposit 674 was subsequently surrendered and canceled, and on May 4, 1877, certificate of deposit No. 858, for $4,894.89, with interest at ten per cent, was executed by Ammon, Scott & Co. to Henry Heively therefor.
7. On the 3d of May, 1878, certificates of dej>osit No’s 673, 675 and 858 were surrendered and canceled, and certificates of deposit -No’s 997, 998 and 999, were given therefor. These are the certificates of deposit set out in the plaintiffs’
The following is a copy of No. 997.
“Office of Deooraii Agricultural Works ) and Flouring Mills.
“Ammon, Scott & Co., Proprietors. )
“No. 997. Deooraii, Iowa, May 3, 1878.
“ Henry Heively has deposited in this office $1,114.12, payable to his order, on demand, after date, on return of this certificate, with interest from date, until paid, at the rate of ten per cent per annum.
“Ammon, Scott & Co., per Geo. W. Scott, Secretary.”
On the back of said instrument is the following indorsement, viz:
“ For value veceived we hereby guarantee payment of the within note, and waive demand, notice and protest.
“George W. Scott,
“ John Ammon.”
No. 998 is for the sum of $2,000, payable eighteen months after date. No. 999 is for the sum of $4,728.24, payable thirty months after date. The guarantors of these certificates, George W. Scott is secretary, and John Ammon is juesident, of Ammon, Scott & Company. It thus appears that, although the original indebtedness represented by the notes maturing in three, four, five and six years, has several times changed its form, it has never in fact been paid. One evidence of indebtedness has simply been surrendered and canceled, and another substituted in its place. It does not appear that there was any intention that any of the various evidences of indebtedness should be received in satisfaction of the debt. Henry Heively, one of the plaintiffs, testifies as follows: “The three certificates are the property of myself and my wife. * * * The consideration of them was the mill prop
G. W. Scott, -secretary of Ammon, Scott & Co., testifies: “ I know the certificates in question. These certificates were given in exchange for notes that were secured in the mortgage. The notes in the mortgage fell due, and were lifted, and these were put in and substituted. There was no other consideration than that; there was no money deposited; they indicate that there was, but they were given for notes described in the mortgage that fell due. Henry Heively simply surrendered the notes, and these were put in the place of them.”
John Ammon testified: “ The mortgage in question was given to secure the purchase-money of the property described in it. The three certificates held by plaintiff is the same
In view of the testimony, and all the circumstances of 'the case, it is very plain that, as between the debtor and creditor, the debt still subsists, is unsatisfied, and the mortgage stands as security for it. The following authorities establish this proposition most conclusively: Bolles v. Chauncey, 8 Conn., 389; Funk v. Branch, 16 Conn., 259; Brinkerhoff v. Lansing, 4 Johnson’s Ch., 65; Yobey v. Barber, 5 Johns., 68; Watkins v. Hill, 8 Pick, 522; Pomeroy v. Rice, 16 Pick., 22; Cole v. Gackett, 1 Hill, 516; Putman v. Lewis, 8 Johns., 389; Johnson v. Weed, 9 Johns., 310; Flower v. Ellwood, 66 Ill., 438; 2 Am. Leading Cases, p. 245, el seq.; Paine v. Vorhees, 26 Wis., 526; 2 Jones on Mortgages, Sec. 924, and cases cited; Sloan v. Rice, 41 Iowa, 465; Farwell v. Grier, 38 Iowa, 83; Port v. Robbins, 35 Iowa, 208; Farwell v. Salpaugh, 32 Iowa, 582; Packard v. Kingman, 11 Iowa, 219.
He was shown the four notes due in three, four, five and six years, which were in the hands of Ammon, Scott & Oo., with the receipt of plaintiff thereon. He testifies he was told by Scott, secretary of the company, that there was a balance of $7,000 due the plaintiff, and that he advanced money to the corporation, and took the mortgage, with the understanding that only that amount was due. At the same time lie testifies as follows: “ The books of the corporation were shown to me, containing an account of the payment of these mortgage notes, and these books were shown for the purpose above stated. I think I do remember of seeing or being informed in relation to other notes and certificates of deposit at the time; and I was informed that some of the notes were taken up and subsequent certificates issued. I am not distinct about the payment; my recollection is they satisfied me these notes had been paid. The others I am not so clear about. In making that loan I relied upon the information I then and there obtainéd.” Being a director of the corporation during nearly the whole time that the various changes in the form of the indebtedness were being made, he cannot be presumed to be ignorant of the real nature of that transaction. Besides, being informed that some of the notes were taken up and certificates issued, he was put upon inquiry, and should have ascertained the condition of the indebtedness before he advanced his money. The following authorities are directly in point: Bolles v. Chauncey, 8 Conn., 390; Funk v. Branch, 16 Conn., 274; Pomeroy v. Rice, 16 Pick., 22; 2 Jones on Mortgages, Sec. 927. We a re of opinion that Dickerman acquired no right paramount h > those of the plaintiffs.
III. The only remaining question is, how far is Matteson, the assignee of Dickerman, to be protected? Matteson is the L rother-in-law of Dickerman, and does business with him in
Affirmed.