Connard v. Colgan

• Citation: 8 N.W. 351,55 Iowa 538
• Parties: CONNARD v. COLGAN
• Decision Date: 25 March 1881
• Court: Iowa Supreme Court

8 N.W. 351

55 Iowa 538

CONNARD v. COLGAN

Supreme Court of Iowa, Des Moines

March 25, 1881

Appeal from Monroe District Court.

THIS action is brought to recover the amount of a bond executed by the defendant to the plaintiff for $ 500, with interest at the rate of nine per cent, payable semi-annually, and to foreclose a mortgage executed to secure said bond. The defendant answered, alleging that the bond and mortgage were procured by fraud, and are without consideration. The cause was tried to the court, and a decree was entered dismissing the plaintiff's petition. The plaintiff appeals. The facts are stated in the opinion.

REVERSED.

Leggett & McKemey, for appellant.

Perry & Townsend, for appellee.

OPINION

DAY, J.

The undisputed facts in this case are as follows: Fuller & Hill were dealers in real estate, loans and western securities at Fairfield, Iowa. Howard Darlington was a broker in the city of Philadelphia. Prior to January, 1878, Fuller & Hill had been negotiating with Darlington for a loan from Connard to one Parsons. On the 23d day of January, 1878, Fuller & Hill advised Darlington by letter that Parsons would not complete the loan, and forwarded an application of Thomas Colgan, the defendant, for a loan of $ 1,500, asking if Connard would take this loan, agreeing that the date might be made the same as the loan they were negotiating for Parsons, so that interest would be recovered for the time the money lay idle and requesting a reply by telegram. On the 28th day of January Darlington telegraphed Fuller & Hill that Connard would make the loan. On the same day Darlington wrote Fuller & Hill to the same effect, and enclosed a bond and mortgage for execution. At the solicitation of Fuller & Hill Colgan executed a bond for $ 1,500, payable to Rees Connard, and dated as of January 1, 1878. The bond contains the following recital: "This bond is secured by a certain mortgage deed, of even date herewith, made by said Thomas Colgan to Rees Connard, which is duly recorded upon the records of Monroe county." The defendant also executed a mortgage to secure the bond, bearing the same date. On the 30th of January Fuller & Hill forwarded the bond to Darlington, and drew upon him a sight draft for the amount of the loan, less his commission of three per cent. The bond was received about the 2d of February and turned over to Connard who paid to Darlington the whole amount of $ 1,500 thereon, and Darlington paid Fuller & Hill's draft for $ 1,455. When Connard accepted the bond he asked where the mortgage was, and was told by Darlington that it had to be recorded, and that he expected it on in a few days. The defendant took the mortgage to the recorder's office, and gave directions to file it, but not to record it until he got his money. The mortgage is marked "filed for record February 26, 1878," and was duly recorded. Afterward Colgan obtained the mortgage from the recorded. The mortgage never came into the actual possession of the plaintiff.

I. The defendant sets up in his answer that he never received any money on the bond. The bond imports a consideration, and the burden of proving a failure of consideration is upon the defendant. That the plaintiff paid the whole amount of the loan to Darlington is fully established by the evidence. It further clearly appears that Darlington paid Fuller & Hill's draft for the amount of the loan, less his commission of three per cent. The money came into the possession of Fuller & Hill. If the defendant never received it, it must have been embezzled by Fuller & Hill. The defendant was not present at the trial, and did not testify. There is something mysterious in his absence from the trial and his failure to testify as to the receipt of the money. His attorney testifies: "I don't know where Thomas Colgan is. I supposed he was in this county until very recently. I began to inquire for him as court approached, and found he was absent. He may be working on the railroad between Knoxville and Des Moines. I hear he is in Kansas, but I don't know. He is out of this vicinity."

We feel constrained to hold that the...