Corn Belt Sav. Bank v. Burnett
| Decision Date | 14 December 1926 |
| Docket Number | No. 37724.,37724. |
| Citation | 211 N.W. 217,203 Iowa 271 |
| Parties | CORN BELT SAV. BANK v. BURNETT ET AL. |
| Court | Iowa Supreme Court |
OPINION TEXT STARTS HERE
Appeal from District Court, Linn County; Atherton B. Clark, Judge.
The plaintiff, a judgment creditor of Albert B. Burnett, brings this action, in equity, to subject certain real property in Linn county to the payment of its judgment, and to have the lien thereof established as senior and paramount to the lien of a mortgage executed to and held by the Alburnett Savings Bank, for itself, and as trustee for Roscoe Billings, Hatch & Fish Company, Farmers' Elevator Company, H. N. Rockwood, and Rosey F. Adams, the remaining defendants, except Mrs. Burnett. The court declined to grant the relief prayed, and the plaintiff appeals. Affirmed.Johnson, Donnelly & Lynch, of Cedar Rapids, for appellant.
Crissman & Linville, of Cedar Rapids, for appellees.
The appellant, a banking corporation located at Cedar Rapids, is the owner of a judgment in the district court of Linn county, against Albert B. Burnett, who is the husband of Jessie I. Burnett, a codefendant, for $4,201.82 and costs, dated March 15, 1924, which judgment, by the terms thereof, is a lien upon--
“all that part of the north half of the northwest quarter (N. W. 1/4) of section twenty-five (25) and of the west half (W. 1/2) of the southwest quarter (S. W. 1/4) of section twenty-four (24) lying east of the Illinois Central Railway Company's right of way (excepting one acre which is owned by Fred Atz) and the northeast quarter (N. E. 1/4) of the southwest quarter (S. W. 1/4) all in township 85, north range 7, west of the fifth P. M.”
The appellees other than the Burnetts are creditors of the judgment debtor, whose claims purport to be secured by a mortgage executed by the Burnetts March 13, 1924, to the Alburnett Savings Bank for itself and as trustee for the remaining appellees. Said mortgage is on the above described real property, and--
“ also, in the event the same is not exempt to mortgagors or either of them as a homestead and is subject to the debts of them or either of them, and under no other conditions whatsoever, the southeast quarter (S. E. 1/4) of the southwest quarter (S. W. 1/4) of said section twenty-four (24), it being understood that mortgagors claim the last above-described 40-acre tract as their homestead acquired and held prior to the year 1917.”
Appellant alleges in its petition that the said mortgage was executed in fraud of creditors and asks that the lien of its judgment be decreed senior and paramount thereto as to all of said property, and particularly the S. E. 1/4 of the S. W. 1/4 of section 24. The claims of all the creditors named in the mortgage aggregate $22,967.52, which, with two prior mortgage incumbrances of $10,000 and $5,000, respectively, considerably exceed the full value of the entire tract. The bona fides of the claims of the respective creditors named in the mortgage is not questioned in this court, but it is asserted by appellant that the provision of the mortgage quoted above and printed in italics purporting to include the S. E. 1/4 of the S. W. 1/4 of section 24 therein was inserted with the intention and purpose on the part of all of the parties thereto of aiding and assisting the judgment debtor to hinder and delay his creditors, particularly the appellant.
The material facts disclosed by the record, summarized briefly, are, in substance, as follows: Albert B. Burnett and his wife Jessie resided for many years on the land in controversy, which was located near Alburnett, in Linn county. They moved from the farm in 1913 and did not again reside thereon until about January 1, 1924. During the period intervening, they resided in Alburnett and in Cedar Rapids, in each of which places they owned and resided in one or more residences. The residence property in Cedar Rapids was sold in 1918, and the rest of the time, prior to 1924, the Burnetts lived in rented property or at a hotel. The mortgage in controversy was executed by the Burnetts at the office of Crissman & Linville, attorneys at law, at Cedar Rapids, on March 13, 1924. At this time, Crissman & Linnville were attorneys for Rosey F. Adams and the Hatch & Fish Company, and they had been pressing Burnett for payment of their claims. They were not, however, attorneys for any of the other creditors named in the mortgage. The meeting at the office in Cedar Rapids on March 13, 1924, was at the request of Burnett, who personally notified the creditors named in the mortgage who were not represented by attorneys that he desired to meet them at the office of Crissman & Linville on the above date. The meeting, which was attended by the creditors or some one representing them, was held as planned. The Burnetts at the time claimed that the 40-acre tract, on which the improvements were located, was their homestead, and therefore exempt from execution. This claim they asserted in their answer in this case, but the court found against them on this point and reaffirmed the lien of appellant's judgment thereon.
[1][2] The provision of the mortgage quoted above, and which appellant contends, on its face, shows the fraudulent character and purpose of its execution, is, nevertheless, valid and binding as between the parties thereto. Whatever...
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