Johnson v. McGrew

Day, J.

I. The testimony is irreconcilably in conflict.

The plaintiff testifies : “ E. E. McGrew placed in my possession a note secured by mortgage oñ a farm that he sold to one Eitter, made by Solomon Eitter to E. F. McGrew or order, for the sum of $1102 * * * * * ; said note to be my property on the condition that he, McGrew, would redeem that part of the land included in a mortgage given by Ritter to secure the above stated note, said land having been sold for the payment of R. F. McGrew’s debts for the purchase of goods, on execution on judgments of Stine, Kramer & Co.; also, a judgment of Whitman, Carter & Brown v. McGrew. When these judgments were paid off and satisfied in full by McGrew, I was then to take the note, or the note was then to become my property, and not till then. * * * * * At the time he executed his two notes, together with a mortgage securing the same, in Rice’s office, Judge Rice suggested that perhaps the note ought to be assigned without recourse. I said to the judge and McGrew, that it was not to be so assigned as yet, but whenever McGrew redeemed the land and paid off those judgments, he, McGrew, might assign it without recourse, or any other manner that he wished. I told McGrew that all of my notes would be left with my brother Aaron, and when the land was redeemed he could assign it as he pleased. R. F. McGrew assented to this, but I could not give his language now. It was well understood.”

The defendant testifies: “There was no condition whatever attached to the transfer, of the Ritter note to plaintiff. He took the note at its face and the interest on it up to the 13th of August, 1870, less the credit, as that amount in payment of the land. He took it the same as if I had paid him that amount of money — he took it as an absolute payment. I suppose he has the note yet. I don’t know what has been done with the Ritter note; I have not seen it since I traded it to plaintiff. I suppose he has it. I first ascertained that plaintiff claimed that there was a condition attached to the transfer of the Ritter note after the commencement of this suit, in his amended petition. He never made any such claim before the commencement of this suit. The reason I did not give the plaintiff my note for the $1,202.75 at the time I gave the other notes was, that the amount of the Ritter note * * * * was absolute payment of the $1,202.75. I would not have traded with plaintiff if I could not have put in the Eitter note as part payment on the land, because I had not the money to pay, and would not have bought otherwise. I traded because I could put the Eitter note in at its face and interest as. a payment on the land. The plaintiff said he could use the note in paying his debts to a better advantage than he could the land.”

The plaintiff is slightly corroborated by other witnesses. The note is payable to E. F. MeGrew or order, and is not assigned. It is very unreasonable to suppose that a man of ordinary business qualifications, as plaintiff is presumed to be, would take in absolute payment of the consideration of the sale of real estate a note secured by mortgage upon land, which, before the execution of the mortgage, had been sold on execution, and which, if not redeemed, would be worthless as a security. The defendant is entirely uncorroborated. ~We think the evidence preponderates, at least slightly, in favor of plaintiff.

1. PLEADING: admissions: amendment. II. Appellant makes the point that the facts stated in plaintiff’s first amended petition are inconsistent with his present theory; that he is bound by the allegations of this amended petition, and that it is conclusive against his right of recovery. In support of this position the principal reliance is placed upon Mulligan v. The Ill. Cent. R. R. Co., 36 Iowa, 189.

The part of the amended petition referred to by plaintiff is as follows: “Plaintiff avers that the defendant agreed and promised and undertook on his part that, if plaintiff would accept said note as part payment on said land, defendant would redeem the lands, etc.; and plaintiff avers that it was upon these terms that he was induced to take said note from defendant without indorsement or further secui’ity.” The distinction between this averment and the one referred to in Mulligan v. Ill. Cent. R. R. Co., supra, is very apparent. In that ease, plaintiff alleged in his original petition that receipts were delivered to him, and he attached copies of them as exhibits to his petition, thus admitting the existence of a distinct item of evidence which became material in the further consideration of the case. It was held that, as a distinct admission of a fact, the petition might be considered against plaintiff, although it had been superseded by an amended petition, unless it appeared that the admission was made iinprovidently or through mistake.

The averments in the foregoing .quotation from the first amended petition, respecting what defendant agreed and promised, are not allegations that distinct items of proof exist, as was the case in Mulligan v. The Ill. Cent. R. R. Co., supra, but they are averments of the existence of the ultimate facts to be established by the evidence.

The first amendment contains nothing which can estop the plaintiff from claiming the facts to exist as alleged in the second amendment.

2. VENDOR'S lien: existence recognized: conveyance. III. It is urged, however, that the doctrine of vendor’s lien does not obtain in this State. Reference is made to Porter v. The City of Dubuque, 20 Iowa, 440, in which it is said: “Whether the doctrine shall obtain in this State has nbt been directly determined by an adjudication involving the question of vendor’s lien, independent of the express lien resulting from the title bond or otherwise. * * * * * It may, therefore, be regarded as still, to a great extent at least, an open question; •and it is one which we are not required to settle in order to determine this case.”

In Pierson v. David, 1 Iowa, 23, the general application of the doctrine of vendor’s lien is recognized in this language: “ Under our law, where so much strictness is required with regard to placing on the appropriate records evidences of liens and incumbrances, it would seem that, in the absence of fraud, courts should be careful in the recognition of this lien. And yet, there is much of good conscience, equity, and natural justice, in providing that the vendor shall not be regarded as having lost all dominion over his property, until he is paid the agreed price. This lien or trust, though formerly objected to, as being in contravention of the policy of the statute of frauds, and for other reasons, is now firmly established. Its necessity is, indeed, too apparent — the beneficial consequences too clear — and its equitable existence too well sustained — to need now either authority or reason to prove its origin or design.”

Aside from the intervening rights of purchasers without notice, the execution of a conveyance does not affect the existence of the lien.

It attaches to the estate, as a trust, equally, whether it be actually conveyed, or only be contracted to be conveyed. 1 Story’s Equity Jurisprudence, Sec. 1218, and cases cited.

We know of no reason for limiting the lien in this State to cases where a bond for a deed has been executed. As between the vendor and vendee, there is certainly as much equity in allowing the,vendor the Hen in one case as the other. If the rights of innocent purchasers have attached, of course such purchaser cannot be affected by the Hen.

For a case in which a vendor’s Hen was allowed and enforced in an exchange of lands, for a deficiency in value of the lands taken in exchange, on account of the fraudulent representations of the other party, see McDale v. Purdy, 23 Iowa, 277.

3.____:under statute: remedy. ' Eut whatever might be the view of the question under the general doctrines of equity, there can be no doubt respecting it under the provisions of our statute. The.contract was made in August, 1870, and the action was commenced in January, 1873. The rights of the parties are to be determined by the provisions of the Eevision of 1860.

Sections 3671 and 3672 of the Eevision, 2094 and 2095 of the Code of 1851, are as follows: “The vendor of real estate, when part or all the purchase money remains unpaid after the day fixed for payment, whether time is, or is not the essence of the contract, may file his petition asking the court to require the purchaser to perform his contract, or to .foreclose and sell his interest in the property. The vendee shall, in such cases, for the purpose of the foreclosure, be treated as a. mortgagor of the property purchased, and his rights may be foreclosed in a similar manner ”

Although the cases arising under these sections have usually been those in which a bond for a deed has been executed, or no conveyance has been made, yet they are not limited to such cases, but they apply as well where a deed has been made. In David v. Pierson, supra, it is said: “The design of these sections was, as we regard it, to place the vendor and vendee in the same position, so far as related to the remedy, as the mortgagor and mortgagee, in cases of express mortgages.”

IY. It is claimed, lastly, that plaintiff has waived his lien. This position, in the view which we take of the evidence, is not tenable. The Ritter note, because of the neglect of the defendant to redeem the land embraced in the mortgage securing it, did not become the property of plaintiff. For the amount of the consideration represented by that npte, plaintiff 'has received nothing. He cannot, therefore, be held to have waived his lien for that amount.

The appellant’s abstract covers twenty-eight pages, and fairly and fully presents everything material in the case.

4. PRACTICE in the Supreme Court: abstract: costs. The appellee has printed an abstract of thirty-three pages, repeating much that is contained in appellant’s abstract, but submitted in the form of question and answer, and containing nothing really necessary to a proper consideration of the case, thus imposing upon us unnecessary labor, and creating needless expense. For this abstract no costs will be allowed.

The judgment of the court below is

Affirmed.

Case Details

Case Name: Johnson v. McGrew

Court Name: Supreme Court of Iowa

Date Published: Mar 24, 1876

Citation: 42 Iowa 555

Court Abbreviation: Iowa