66 Iowa 731 | Iowa | 1885
The three causes were tried together in the circuit court, and were submitted in this court on one abstract and argument, and will be disposed of in one opinion. On the twelfth of November, 1877, the defendants R. A. Barrett and W. L. Barrett, acting as the agents and trustees of the heirs of R. A. Barrett, deceased* and J. N. Martin sold to the firm of Sweney & Bell the furniture and fixtures in a hotel in the city of Burlington for the price of $7,500. Of this amount the purchasers paid $3,000 in cash, and they gave their promissory notes (six in number) for the balance, and to secure the same they gave a chattel mortgage on the property purchased. On the same day Sweney & Bell rented of defendants, for a term of years, the hotel in which said property was situated. At the time this lease was entered into, the firm of Sweney & Bell was composed of IT. Sweney and J. M. Bell, but by a subsequent arrangement the interest of II. Sweney in the property and business of the firm was taken by her husband, M. Sweney, and this arrangement was assented to by defendants. This new firm having made default in the payment of the rent of the hotel, a suit was instituted by defendants against them therefor, in which defendants claimed a landlord’s lien on the furniture and fixtures in the hotel, and an attachment was issued in said suit, and the property in question was seized thereon by the sheriff. In that action defendants recovered judgment against Sweney & Bell for $1,777.09, and an order was entered for the sale of the attached property. A special execution was issued on
Plaintiff Rand is executor of the estate of John Taylor, deceased. His claim is that one of the promissory notes given by Sweney & Bell in the purchase of the property belongs to said estate. This note is for $1,000, and by its terms it became due on the twelfth of November, 1878. The claim asserted by plaintiff Julia Noble, in the action first instituted by her, is that she is also the owner of one of the notes given by Sweney & Bell in the purchase of said property; said note being for $1,000, and falling due February 12,1878, and was payable to the order of J. N. Martin.
While they were in possession of the hotel under the lease, Sweney & Bell purchased certain billiard tables, which they placed in the billiard-room in the hotel. For a portion of the purchase price of this property they gave their notes, and, to_ sécure the same, gave a chattel mortgage on said billiard tables. This property was also seized on the attachment issued in the cause instituted by these defendants against Sweney & Bell, and it was sold on the special execution issued on the judgment: rendered therein. The claim asserted by plaintiff Julia Noble, in the action last brought by her, is that she is the owner of these notes, and the mortgage given to secure them. Defendants admit the execution of the mortgage, as alleged by plaintiffs, but deny that plaintiffs have any interest therein, or in the property covered thereby, and they aver that the debts secured by said mortgages were paid off and discharged by Sweney & Bell; but that, for the purpose of cheating and defrauding defendants, who were entitled to a landlord’s lien on the property covered thereby to secure the rent of said hotel, they procured said mortgage
The cause in which E. D. Rand, executor, is plaintiff, and the one first instituted by plaintiff Julia Noble, were tried in the circuit court as equitable actions. The other cause was tried as an ordinary action.
After George Sweney had paid the amount of the note to the bank, M. Sweney repaid him the amount and received the note from him. We are satisfied, however, that this payment was made with money belonging to plaintiff, and that M. Sweney acted in the transaction as her agent. Both plaintiff and Sweney swear that the latter acted in that capacity in the transaction, and their testimony on the question is not contradicted. We are also satisfied that the transaction was intended by the parties asa purchase by plaintiff of whatever interest accrued in favor of George Sweney on account of the payment by him of the amount of the debt evidenced by said note. It becomes important, therefore, to determine the character of the right which accrued in his favor on account of such payment. The relation which existed between Sweney & Bell and him was that of principal and surety, and when he paid the debt he was entitled to be subrogated to all the rights of the creditor. lie was entitled to have the principal undertaking assigned to him, and 1 o have the benefit of all securities which had been placed in the creditor’s hands by the principal debtor. In equity, the payment by him of the amount of the indebtedness is regarded as a purchase of the debt rather than a payment of it; and when, the bank assigned the note to him, it did simply what he was entitled to have done by virtue of his relation to the parties and the fact of his having made the payment. See Pomeroy Eq. Jur., § 1419 and authorities cited in the note.
When George Sweney made the payment to the bank, then, and received the assignment of the note, he became the owner of the indebtedness evidenced by it. Tie also became the equitable owner of the chattel mortgage which was given
Aeeirmed.