Woodward v. Davis

53 Iowa 694 | Iowa | 1880

Rotiirock, J.

í mortgage • er1inIieguirs’ tItle-There is but a single question presented in this record for our determination. It is this: Was the mortS’age ^7 PaUs merged in the legal title taken ^7 ^7 ^10 conveyance from Davenport? If it was not so merged, and if Davis notwithstanding the conveyance was entitled, as against junior incumbrancers, to set up the mortgage as a prior lien, the decree of the court below was erroneous. It is proper to say in the outset that there is nothing in the record to justify an inquiry into the good faith or fairness of the compromise made by Davis and Davenport. It is true there appears to have been usurious interest included in the mortgage, but so far as appears the usury was deducted when the compromise was made. We say this much without determining the right of apjmlloes to raise the question of usury, and have only thought proper to mention it because it is urged in argument by counsel for appellees.

It is a general rule, and one abundantly established by authority, that where a mortgagee receives a conveyance of the mortgaged property his mortgage will not merge in the legal title, but will be kept alive to enable him to defend under it against the title or lien of another acquired after the execution of the mortgage, if such protection is to the interest and consistent with the intention of the mortgagee, and in the absence of evidence to the contrary liis intention will be presumed to correspond with his interest. Wickersham v. Reeves & Miller, 1 Iowa, 413; Wilhelmi v. Leonard, 13 Id., 330; Linscott v. Lamart, 46 Id., 312; First National Bank of Waterloo v. Elmore, 52 Id., 541; Stimpson v. Pease, ante, 572; Jones on Mortgages, Vol. 1, § 874.

The written agreement between Davis and Davenport, by which the compromise of said suits was effected, contains this stipulation: “The said Davenport is to have the said real estate released from the liens of the sheriff (Woodward) mortgages and George A. Davenport’s judgments, and said Davis to have his attorney obtain necessary release of the Ooykendall judgment.” The real estate mentioned in this contract was that conveyed to Davis, and which is now the subject of controversy. It is averred in the cross-petition of Ooykendall & Company that Davis assumed the payment of the judgment; no such obligation seems to have been created by this contract. It was no more than an undertaking upon the j>art of Davis to protect himself against that judgment, [f he had procured a formal release of it without payment, the judgment would still have remained unpaid, and his contract with Davenport would have been performed. It appears in evidence that all of the senior lieu holders released their liens upon this property without payment, and it further appears that it was thought by 'the parties that Davis could procure through his attorney a release of this judgment without payment of it, because his attorney was also the attorney of Coykendall & Company. As one of the witnesses who was present at the settlement expresses it, Davis “ took his chances” so far as the Coykendall judgment was involved in the transaction.

Under this state of facts it was clearly to the interest of Davis to hold the mortgage lien as a protection against the judgment. That such was his intention can admit of no question. It cannot be believed that he intended voluntarily to give up and surrender his senior mortgage lien to be postponed to the lien of a junior judgment to the amount of $1,900. He was under no obligation to Davenport to make suck a sacrifice, and bis interest was clearly against it, and we think his intention was consistent with his interest.

Reversed.