120 Iowa 324 | Iowa | 1903
The property which defendants were about to sell on special execution at one time belonged to the Northern Investment Company, a corporation organized under the laws of the state of Kentucky. It was incumbered by mortgages amounting in the aggregate to about $400,000. On or about April 13, 1895, defendant Stetson commenced'action to foreclose one of these mortgages, for something like $23,000, and in said action caused a writ of attachment to issue, which it is claimed was levied upon the property in controversy. Two days prior to that, and on the 11th day of April, one Harrison brought suit in the Woodbury district court against the investment company and Stetson to foreclose a mortgage upon the property for something like $100,000. On May 16, 1895, an order was made in this last mentioned case appointing one Black a general receiver of all the property in controversy. Black took possession of the property, collected rents, paid taxes, and interest on mortgages, made repairs, and otherwise cared for and managed the property, until December 12th of that year, when he resigned, whereupon C. D. Foster was appointed in his stead. Foster continued to manage and care for the property and during his management advanced about $9,000 in payment of interests, taxes, etc., part of which he had borrowed, and the remainder he
Counsel first discuss the question as to whether or not there was any valid levy of the Stetson attachment on the real estate in controversy. They claim that no notice of
II. The next question for consideration is the alleged estoppel of record. A. L. Stetson was made a defendant in the Harrison foreclosure case, in which a receiver was
It is manifest from this statement that Stetson was not only a party to'the original Harrison foreclosure, but that he filed his claim with the receiver, appeared to the application for the sale of the real estate, and apparently by and through his attorneys, approved the order. It should be said, in fairness to these attorneys, however, that they 'claim they did not O. K. it as attorneys for' Stetson, but in their individual capacity; they having some individual claims with the receiver. It is also, clear that the order was for a sale subject only to mortgages existing against the property. As Stetson’s attachment was levied prior to the appointment of the receiver, his lien is prior to any claim under the receivership proceedings, and he (Stetson) is not concluded thereby, unless by reason of being a party to the case in which the order for the sale was made. Appellees say that, by reason of the disallowance of Stetson’s claim on the hearing of the receiver’s report, he (Stetson) was out of the case, and was not bound by any further proceedings therein; but it will be observed that the claim was not entirely disallowed. The receiver was authorized to appeal from the judgment allowing the claim, and the hearing upon the report as to such claim was continued. The receiver did appeal the case, and it was affirmed in this court. See case of Stetson v. Northern Investment Co., hitherto cited. The argument is that, from the time of the making of this order, Stetson was out of the receivership matter and paid no further attention to it It may be that he in fact gave it no further
But it is said that the sale ivas made to pay loans made to and advances by the receiver; that Stetson was not a party to the case when these claims were established, and is not bound thereby. This is beside the issues in the case. There is no controversy here over the division óf the proceeds of the sale. The only question now before us is the effect and binding force of the receiver’s sale. The question of division of the proceeds is not for adjudication at this time. Hence we have no occasion to consider the matter of priorities. If Stetson was such a party to the application to sell as to be bound by it, he cannot now collaterally attack the order on the ground that proper priorities wei-e not preserved, or that the showing therefor was not sufficient to justify the order. If Stetson was not a party to the order of sale, so as to be bound thereby,, then, of course, his attachment lien would not be affected by the order. But he was, we think, a party both to the original case and to the application for the order, and he is bound by the terms thereof. Of course, the receiver’s possession was subject to all valid and existing liens; but
Further, it is claimed that on September 18, 1896, the district court found in Stetson’s original case, which was against the trustees and the receivers of the Northern Investment Company that he (Stetson) was entitled ta have the property sold on special execution to pay his judgment. The difficulty with this lies in two facts: First. Stetson’s claim filed with the receivers on September 8, 1896, read in this wise: “Due on decree ordered but not yet filed in the district court of Iowa in and for Woodbury county upon the foreclosure of the mortgage on lots 4, 5, and 6, block 26, Middle Sioux City, with an order for the sale of mortgaged property, $25,531.11 and costs.” He thus elected to give the court appointing the receivers jurisdiction of his claim whenever it should be established in the m^in case. Second. Stetson appeared to the order approving the sale on September 25th, or, if we be wrong in this statement, the order for the sale which we find was binding on Stetson was made on the 19th, after Stetson had obtained his judgment and order for the sale of the attached property. Moreover, an appeal was taken from that judgment, which, as we have said, was finally settled in this court.
Again, it is argued that plaintiff is nothing more than a reorganized Northern Investment Company, but this claim is not sustained by the. record. It is an independent entity, and as much entitled to protection as if it had been a separate person. The order for the sale was that it should be made without redemption, and subject to the mortgages on the separate tracts. This impliedly, at least, negatived all other liens, That the court had power to direct such sale, see First National Bank v. Shedd, 121 U. S. 74 (7
We are constrained to hold that the defendant Stetson was bound by the order made for the sale; that he elected to rely on his remedies against the receivers, instead of on his attachment; and that plaintiff is entitled to protection. Reaching this conclusion, there is no necessity for considering the question of estoppel in pais.
The judgment and decree must be reversed, and, at plaintiff’s option, it may have a decree in this court permanently enjoining the sale of the property on execution, or the case may be remanded to the district court for a decree in harmony with this opinion. — Reveesed.