10 N.W. 763 (Iowa 1881), Dilger v. Palmer
|Citation:||10 N.W. 763, 60 Iowa 117|
|Opinion Judge:||SEEVERS, J.|
|Party Name:||DILGER v. PALMER|
|Attorney:||Mitchell & Penick, for appellants. O. A. Bartholemew, for plaintiff. Stuart Bro's, for Gear and the Bank.|
|Judge Panel:||SEEVERS, J., DAY, J. BECK, J., dissenting. BECK|
|Case Date:||December 13, 1881|
|Court:||Supreme Court of Iowa|
Appeal from Lucas District Court.
ACTION to foreclose a mortgage in the ordinary form, executed by Thomas E. Palmer and wife. John H. Gear, trustee, and the First National Bank of Chariton, were made defendants, it being alleged that they were lien holders junior to the mortgage. Thos. E. Palmer and wife filed a cross-petition which was answered by the other defendants. There was a decree foreclosing the mortgage, but the relief asked for in the cross-petition was denied. The defendants, Thos. E. Palmer and wife, appeal.
[60 Iowa 118]
The facts necessary to be stated are: That Thos. E., and Ann Palmer were married in 1846, and in August, 1873, they executed the mortgage sought to be foreclosed on the S. E. 1/4 of the S.W. 1/4 and the S.W. 1/4 of the S. E. 1/4 in section 20, township 72, range 21. The first named tract was their homestead at the time the mortgage was executed, and they have ever since then resided thereon. In 1873, after the execution of the mortgage, Thos. E. Palmer caused the homestead forty to be sub-divided into three lots, and platted and designated as lots Nos. one, two, and three. The house occupied as a home by the Palmers is situate on lot number two. Afterward, in 1873, Thos. E. Palmer and wife, for the expressed consideration of five thousand dollars, conveyed by warrantee deed the S.W. 1/4 of the S. E. 1/4 aforesaid, and lot number one of the homestead forty, to C. H. Palmer, and on the same day they conveyed by a similar deed, for the expressed consideration of three thousand dollars, lot number three to Anna L. Palmer.
In January, 1875, Thos. E. Palmer and wife and C. H. Palmer and wife, executed to John H. Gear, trustee, a mortgage on the S.W. 1/4 of the S. E. 1/4 aforesaid, and said lot number one, which mortgage was afterward foreclosed, and said premises sold on execution issued on the judgment of foreclosure to said Gear as trustee, and the sheriff, before the commencement [60 Iowa 119] of this action, conveyed the premises aforesaid, to said Gear as trustee.
In September, 1876, the Bank recovered a judgment against T. E., C. H. and Anna L. Palmer, upon which execution was issued and levied on said lot three, and the same was sold thereunder to the Bank, to whom the sheriff conveyed said lot three before the commencement of this suit.
The relief asked in the cross-petition of Thos. E. Palmer and wife is, that the decree foreclosing the mortgage be so drawn that all the parcels of real estate aforesaid be sold before said lot two, and that it only be sold in the event the other tracts fail to bring a sum sufficient to satisfy the mortgage. The relief was denied and the court ordered that lot number two should be first sold, and, that the other tracts should be sold to make up the deficiency, if any there was.
All parties to the action are satisfied with the decree of the District Court, except the mortgagors, Palmer and wife. The questions for determination are:
First. Where a mortgage is executed on the homestead and other real estate, and the latter is sold and conveyed to another by the mortgagor, can he insist that the property so conveyed should be first sold for the purpose of satisfying the mortgage? And, Second. When a mortgage is executed on the homestead and a part thereof is conveyed to another by the mortgagor, can the latter insist that the portion so conveyed should be first sold in satisfaction of the
The statute provides: "The homestead may be sold for debts created by written contract executed by the persons having the power to convey, and expressly stipulating that the homestead is liable therefor, but it shall not in such cases be sold, except to supply the deficiency remaining after exhausting the other property pledged for the payment of the debt in the same written instrument." Code, § 1993. Counsel for the appellant insist:
I. That the plain and evident meaning of the statute is, [60 Iowa 120] that all other property pledged for the payment of the mortgage, whether owned by the mortgagor or not at the time of the foreclosure, must be exhausted before the homestead can be sold, and that, if a portion of the homestead has been sold and conveyed by the mortgagor to another person, such portion must be first sold before the remainder can be resorted to, and it is claimed that the mortgagor has the right to so insist.
It seems to us that this argument proves too much. For by the same course of reasoning it can be as well said that a literal construction of the statute requires that all property described in the mortgage, other than the homestead, whether owned by the mortgagor or not when the mortgage was executed, must first be sold, and certainly this cannot be successfully claimed. The meaning undoubtedly is, that all property pledged, other than the homestead on which the mortgage is a valid lien, shall be first exhausted. One person cannot pledge the property of another for the payment of an indebtedness of the former. While it is true that the mortgage in question is a valid lien on all the property, it remains to be determined in what manner the lien shall be enforced. As between the mortgagor and mortgagee, the former has the right to insist that all the property other than the homestead shall be first exhausted. The statute does not contemplate a case where a portion of the property may have been sold and conveyed by the mortgagor to another person. The statutory thought is, that the title to the property remains as it was when the mortgage was executed, that no intervening rights have accrued, and that the mortgagor in justice and equity can insist, without injury to any one, that the homestead shall be last applied to the payment of the debt. Ordinarily, when a person sells real estate, he receives what he deems to be its full value from the purchaser. Now to permit such person...
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