Port v. Embree, 54 Iowa 14

Port v. Embree

54 Iowa 14 | Iowa | 1880

Beck, J.

I. The petition prays the foreclosure of two mortgages covering the same land, both executed by Ezra Embree; the first made to J. C. Butler, March 27, 1876, and transferred to plaintiff, the second executed to plaintiff December 7, 1876.

The intervenor, in his petition, alleges that he sold and conveyed the land described in the mortgage to Ezra Embree, in 1863, a part of the purchase money being secured by a mortgage executed at the time, and afterward dnly recorded; that through the mistake of the scrivener drawing it the intervenor’s mortgage failed to describe correctly the land intended to be conveyed, the southwest quarter, instead of the northwest quarter, being mentioned in the mortgage; that this mistake was unknown to the intervenor and all the parties to the action, until about the time this suit was commenced, and that plaintiff had actual notice of the intervenor’s mortgage, and of the intention of the parties thereto that it should cover the land involved in this suit.

1. MORTGAGE : tfon:dprfority t:íkeeto ieSs" cnption. . II. The evidence established the execution of the mortgages set out in plaintiff’s petition, and that he is now the holder of both. It is also shown that the inter-v®uor’s mortgage was executed to secure a part ^ purchase money of the land, and that thj.QTjgh mistake it fails to describe the property intended to be conveyed. The evidence fails to show that plaintiff had notice of the intervenor’s mortgage and debt prior to the execution of the mortgage to plaintiff, and the transfer to him of the other mortgage.

The plaintiff being a mortgagee without actual or constructive notice of the intervenor’s mortgage, and his equities *16based thereon, will hold the paramount lien, unless the case falls within another rule which will defeat his equity. Counsel for the intervenor insists that the case does come within a well established rule which gives him priority, though the plaintiff had no notice, actual or constructive, of the intervenor’s mortgage and equities. Counsel states the doctrine upon which he x’elies in the following language:

“ The rule is clearly laid down that if the second incumbi’ancer or purchaser takes his lien or conveyance in payment of, or as security for, an antecedent debt, without jiarting with any new considex’ation or placing himself in a worse condition than he would have been in, had he received notice of the prior equitable title or lien previous to his taking his own, the law will not allow him to hold it to the injuxy of the othei\ He stands in equity pi’ecisely as though he had notice of the prior equity before taking his lien.”

Concerning the coi’rectness of this rule we need not inquire; for the purpose of this case it may be admitted to be coi'rect. It will be noticed that, in oi’der to bring plaintiff within the opei’ation of the rule, its express language requires that he must have parted with no new consideration, and must not have been placed in a worse condition than he would have been in had he not taken the mortgages held by him.

The evidence shows that plaintiff, upon taking the mortgage executed to him, extended the time of payment of the debt due him from Ezra Embree. The mortgage was also executed under an agreement which plaintiff entered into with the mortgagoi’, that he would purchase the mortgage executed to Butlex*, which he afterwards performed. This agreement is an explanation of the plaintiff’s purchase of that mortgage. Plaintiff extended time upon his claim and purchased the Butler mortgage while in ignorance of the intervenor’s mortgage. He thus assumed obligations and paid out money upon the faith that Butler’s was the pi'ior «mortgage. He was, to use the language of. the exception to the rule, as stated by counsel, “ placed in a worse condition than *17lie would have been in bad be received notice of the prior equitable title or lien previous to bis taking bis own.”

“VYe conclude, therefore, that under the rule announced by counsel, the plaintiff’s mortgage must be enforced as the paramount lien upon the land. The decree of the District Court must be

Affirmed.