McDonald v. Second National Bank

106 Iowa 517 | Iowa | 1898

Ladd, J.

1 The plaintiff, only, appeals, and the decree, in so far as favorable to him, requires no consideration. McWhirter v. Crawford, 104 Iowa, 555. We shall assume, then, that Donald McDonald and wife, on the eighteenth day of January, 1893, conveyed the farm, of about one thousand four hundred acres, in Plymouth county, to the plaintiff, as security for the indebtedness then due him, and that his acts of possession were such as to put everyone on inquiry with reference to his interest therein. This farm was incumbered at that time by two mortgages, — one dated May 1, 1889, for sixteen thousand dollars, to Beyer & Co., and another dated October 18, 1890, for eighteen thousand dollars, to A. S. Garretson. At the same time, and to secure the same debt a mortgage was executed by the same parties to Garretson on certain lots situated in Sioux City, Woodbury county, and also a chattel mortgage on a large amount of personal property. Garretson assigned these three mortgages to the Second National Bank of Nashua, N. H. The mortgage to Beyer & Co. was foreclosed, and the land sold to the mortgagees at the sheriff’s sale, December 16, 1893. The proceeds of the property covered by the chattel mortgage were applied on the debt secured. It will be observed that the mortgages securing the notes assigned by Garretson to the bank covered real estate in two counties, — one, lots in Woodbury county, where the mortgagors resided, and the other, land in Plymouth county. The bank began an action in Woodbury county on both mortgages, obtained personal judgment against Donald McDonald, and a decree directing the sale of all the property. Special execution was issued to the sheriff of Plymouth county, the land sold thereunder, and a sheriff’s deed executed to C. W. Iloitt, assignee, who held the certificate of sale, October 30, 1894, and he redeemed from the sale to Beyer & Co., a few days later: The appellant asserts that the court sitting in Woodbury county acquired no jurisdiction to enter a decree foreclosing the mortgage on the Plymouth 'county land, and, as redemption from the sale to Beyer & Co. was made more than nine months after the sale, the bank or Iloitt has no remedy against the land. The plaintiff was not made party to any of these actions, though he had actual notice of their pendency, and had both actual and constructive notice of the mortgages when he received the deed. It thus appears there is no equity in his claim, and that, if his contention is allowed, it must be because of the technical construction of the statute.

Section 3493 of the Code is as follows: “An action for the foreclosure of a mortgage of real property, or for the sale thereof under an incumbrance or charge, or to enforce a mechanic’s lien thereon, shall be brought in the county in which the property to be affected, dr some part thereof, is situated.”

2 II. The appellee insists that the two mortgages should be construed as one instrument. As already mentioned, these were executed at the same time, by and to the same parties, and to secure the same indebtedness. These circumstances show them'to have been a part of the same transaction, but not the same instrument. If security was taken in two mortgages instead of one, for convenience in, recording, this confirms the thought that separate mortgages were intended. The note and mortgages will be read together and construed only with respect to the debt as parts of one contract. Fetes v. O’Laughlin, 62 Iowa, 532, and cases cited; Kennion v. Kelsey, 10 Iowa, 443; 1 Jones Mortgages, section 71. The fact that several mortgages may be considered in connection with the same note will not affect their identity as separate instruments. It is said that because the conditions of defeasance are identical (i. e. the payment of the debt) the case falls within the rule announced in Lomax v. Smyth, 50 Iowa, 232. This distinction is ignored; here the mortgages are complete within themselves, while there the deeds were executed conveying land in different counties, but the condition of defeasance with respect to all such land was contained in a single instrument. While a mortgage need not necessarily consist of one paper, to hold that such an instrument, complete in itself, without evidence to the contrary, is not a distinct mortgage, would be ignoring the technical as well as common meaning of the word.

3 III. The words “shall be” in the section 'of the Code quoted were substituted for “may be” by chapter 126 of the Acts of the Twentieth General Assembly. This section, before this amendment, was construed as permissive only. Insurance Co. v. Gleason, 56 Iowa, 47; Trust Co. v. Day, 63 Iowa, 459. And under a similar provision of the Code of 1851 it was held that an action might be maintained in the county where the defendant resided, though the land was situated elsewhere in the state. Finnigan v. Manchester, 12 Iowa, 521; Cole v. Conner, 10 Iowa, 299. Under section 2795 of the Envision, which provided that the action “must be brought in the county in which the subject of the action, or some part thereof is situated,” the court, in Chadbourne v. Gilman, 29 Iowa, 181, had occasion to pass upon a motion to strike out of a petition so much as related to five separate mortgages on land outside of Dubuque county, where the suit was pending. It appeared that six mortgages covered land in six counties, and each secured a distinct portion of the debt; and it was held that, as the mortgage on the land in Dubuque county was not part of the subject of the action on the other mortgages, and because of a misjoinder of actions, the motion should have been sustained. The difference between that case and the one at bar is apparent. There a distinct portion of the debt was secured by each mortgage. Here both mortgages secured the same debt. We think this not very material, however, because foreclosure proceedings might have been maintained in Plymouth county after judgment was obtained in Woodbury. Banta v. Wood, 32 Iowa, 469; Brown v. Cascaden, 43 Iowa, 103; Morrison v. Morrison, 38 Iowa, 73. Indeed, there appears to be no good reason why appropriate actions might not have been maintained in both counties at the same time. Section 4288 provides that “if separate actions are brought in the same county on the bond or note and on the mortgage given to secure it, the plaintiff must elect which to prosecute. The other will be discontinued at his cost.” By fair implication, a suit may be maintained on the note in one county, and, in a proper case, an action for the foreclosure of the mortgage in another. Difficulty in fixing the portion of the debt secured by each mortgage is obviated by the sale of the different parcels. In this case the lots constituted the homestead of Donald McDonald, and the security on the farm was necessarily first exhausted. Code, section 2976. The sale of the farm made definite the amount secured by the mortgage on the lots.

4 IY. In bringing suit on both mortgages in Woodbury county, there was then a misjoinder of actions, and so much as related to that on the farm in Plymouth county might liave been stricken on motion, under the ruling in Chadbourne’s Case. Code, section 3547. But, by failing to appear, all objections on this ground were waived. Code, section 3548. Where the motion is made, however, the plaintiff may, on application, separate his actions, and file a petition for each. Code, section 3549.

5 Y. But the mere fact that an action is prosecuted in the wrong county does not deprive the court of jurisdiction. This happens when the action is purely in rem, and not in personam as well. Orcutt v. Hanson, 71 Iowa, 514. But if the action is personal, and also pertains to the res, and is brought in the wrong county, the only remedy is that -provided by section 3504 of the Code, which is, in part: “If an action is brought in a wrong county, it may there be prosecuted to a termination, unless the defendant, before answer, demands a change of place of trial to the proper county.” Lyon v. Cloud, 7 Iowa, 1; Cole v. Conner, 10 Iowa, 299; Goldsmith v. Wilson, 67 Iowa, 662. Thus jurisdiction is acquired of a non-resident in a county other than that wherein served with the original notice. Marquardt v. Thompson, 78 Iowa, 158. The only remedy in a’replevin suit brought in the wrong county is that of the above statute. Goldsmith v. Willson, supra. Though the statute restricts the issuance of a writ of attachment to the county of defendant’s residence, or where the written contract is made payable, the writ issued in another county is voidable only. Payne v. Dicus, 88 Iowa, 423. The action to foreclose a mortgage is not purely in rem, but in personam as well. Originally it was regarded as transitory. In so far as local, it is so made by statute. Tbe action, in seeking to cut off the equity of redemption of tbe mortgagors, and to obtain judgment for tbe debt, is personal; but that part of tbe procedure wbicb is directed against tbe hypothecated property for tbe purpose of subjecting it to tbe payment' of tbe debt is m rem, and may be said to be local. In other words, tbe action is dual in form, but partakes so much of a personal suit that tbe statute with reference to change of venue must be held applicable. This appears from Cole v. Conner, supra, where it is said: “It is believed, however, that tbe jurisdiction is local, and can obtain only in tbe county where tbe land lies, and where tbe object of tbe pro1 ceeding is only to sell and foreclose tbe equity of redemption; Still, in such an event, tbe suit should not be dismissed, but should be sent to tbe proper county, under section 1702 of the Code.” Chadbourne v. Gilman, supra, does not announce a different rule; and it is supported by tbe reasoning in Orcutt v. Hanson, supra. Whether section 3504, relating to changes of venue when tbe action is brought in tbe wrong county, applies to purely local action, we shall not now determine. But see Barnes v. Davis, 2 Iowa, 160; Decatur County v. Maxwell, 26 Iowa, 398; College of Physicians and Surgeons v. Guilbert, 100 Iowa, 213. Tbe statute conferred on' tbe defendants tbe right to insist upon the foreclosure suit being tried in tbe county in wbicb tbe subjectmatterwas situated, but this right was waived by their default. Tbe conclusion we have reached finds support in tbe following authorities: Lane v. Burdick, 17 Wis. 95; Gill v. Bradley, 21 Minn. 15; O’Neil v. O’Neil, 54 Cal. 187; Territory v. Judge, 5 Dak. 275 (38 N. W. Rep. 439); Tucker v. Lake, — N. H. — (29 Atl. Rep. 406); Fletcher v. Stowell, 17 Colo. Sup. 94 (28 Pac. Rep. 326); Chouteau v. Allen, 70 Mo. 353. See, also, 9 Enc. PL & Prac. 256. Tbe mortgagors, having been made parties defendant, bad tbe undoubted right to have tbe cause of action relating to tbe land in Plymouth county stricken on motion because of misjoinder, and, in event of filing a separate petition under section 3549 of tbe Code, might have had it transferred to the proper county. But by failing to appear or move they waived all objections to the place of bringing either cause of action, and the decree entered must be adjudged valid.

6 VI. The plaintiff insists the court erred in. dissolving the writ of injunction by which defendants were enjoined from interferring with his possession. But according to his own allegations the deed under which he claims must be construed as a mortgage. The possession of a mere mortgagee is not entitled to protection as against the owner of the fee obtained under a sale made in pursuance of the foreclosure of a prior mortgage. Besides, if entitled to possession, he has a plain remedy at law. The plaintiff will be permitted to make redemption on' the terms fixed in the decree of the district court at any time prior to February 1, 1899. — Aeeirmed.