Waller v. Staples

• Decision Date: 17 December 1898
• Citation: 77 N.W. 570,107 Iowa 738
• Parties: ROBERT WALLER et al., Executors, Appellants, v. ALLEN STAPLES et al., Administrators
• Court: Iowa Supreme Court

77 N.W. 570

107 Iowa 738

ROBERT WALLER et al., Executors, Appellants, v. ALLEN STAPLES et al., Administrators

Supreme Court of Iowa, Des Moines

December 17, 1898

Appeal from Dubuque District Court.--HON. J. L. HUSTED, Judge.

PROCEEDINGS in probate for the allowance of a claim against the estate of a decedent. A jury was impaneled, evidence was submitted, and a verdict for the defendants was returned by direction of the court, and a judgment was rendered in their favor for costs. The plaintiffs appeal.

Reversed.

Longueville & McCarthy, Longueville, McCarthy & Kenline, and N. E. Utt for appellants.

Henderson Hurd, Lenehan & Kiesel and D. E. Lyon for appellees.

OPINION

ROBINSON, J.

On the twenty-eighth day of March, 1892, Elizabeth M. Houlihan and James Houlihan made to Judson K. Deming their promissory note for the sum of fifteen thousand dollars, payable five years after date, with interest thereon at seven per cent. per annum, payable semiannually. To secure its payment, the makers executed a mortgage upon two hundred and eight-one acres of land. At the same time, and as further security James Houlihan executed and delivered to Deming a chattel mortgage on live stock, wagons, harness, and farm implements. On the nineteenth and twenty-second days of December, 1892 Houlihan executed to Deming two other chattel mortgages for the same purpose. On a date not shown, another mortgage was delivered to Deming, which purported to have been executed by Catherine Callahan and Mary Callahan upon sixty acres of land, and their interest in another tract of forty acres. That mortgage provided that it was "to be void on condition that James Houlihan pay the said Judson K. Deming the sum of eight thousand dollars, it being a portion of a note for fifteen thousand dollars this day executed by said James Houlihan to Judson K. Deming." Deming, in taking the note and mortgages specified, was acting for the Second National Bank of Dubuque, of which he was cashier; and, within a short time after the note was received, he indorsed thereon the words "Without recourse," which he signed, for the purpose of transferring the note to the bank. In March, 1893, the bank commenced to foreclose the chattel mortgages, whereupon A. W. Hosford, to prevent the foreclosure, entered into a contract with the bank by which he agreed to pay seven thousand dollars on account of the note. Payments were made under that contract, the last one on the first day of August, 1893, when an indorsement thereon was made as follows: "Seven thousand dollars principal and interest on that amount paid to Aug. 1st, 1893, by A. W. Hosford," and that indorsement was signed, "J. K. Deming, Cashier." In connection with this transaction, the chattel mortgages were delivered to Hosford, and also a satisfaction of them executed by Deming. In September, 1893, the note was sold to G. M. Staples, the defendants' intestate, and was delivered to him with the real estate mortgages. In April, 1894, Staples, for a sufficient consideration, transferred the note to the plaintiffs, who are executors of the Waller estate. An assignment of the mortgages had been made to Staples, but, in order to save the expense of recording an assignment, Deming executed for the bank an assignment to the plaintiffs. The Houlihan mortgage was foreclosed by the plaintiffs, the mortgage property sold, and six thousand six hundred and seventy dollars and five cents realized therefrom to apply on the debt. The amount remaining unpaid of the interest in the note acquired by Staples, and by him transferred to the plaintiffs, is now about three thousand dollars. The Callahan mortgage was a forgery, and nothing has been realized from it. Had it been valid, the property it mortgaged could have been sold for an amount sufficient to pay the remainder due the plaintiffs. We understand that the Houlihans are insolvent. When the bank sold the note to Staples, the words "Without recourse" were stamped below the indorsement respecting the seven thousand dollar payment, and above the signature of the cashier, and also between the words "Without recourse" and the signature of Deming, indorsed by him to transfer the note to the...