Dickerson v. Morse
| Decision Date | 15 March 1927 |
| Docket Number | 37995 |
| Citation | 212 N.W. 933,203 Iowa 480 |
| Parties | FOREST G. DICKERSON, Appellee, v. ISABELLE MORSE et al., Appellants |
| Court | Iowa Supreme Court |
Appeal from Marion District Court.--J. H. APPLEGATE, Judge.
Action in equity, to rescind a contract of purchase of certain real estate by reason of defect of title and to recover the amount paid on said contract. A decree was entered, granting the relief prayed. Defendants appeal.
Affirmed.
Johnson & Shinn and Mabry & Mabry, for appellants.
Johnson & Teter, for appellee.
DE GRAFF, J.
The pleaded facts constituting plaintiff's cause of action and the law applicable thereto, are found in Dickerson v Morse, 200 Iowa 115, 202 N.W. 601. Upon the first trial, the legal sufficiency of the petition of plaintiff was challenged by a demurrer, and the ruling sustaining the demurrer was reversed on appeal. On this appeal, the pleaded defenses, in the light of the evidence, are before us for consideration. It is necessary, in order to understand the defenses interposed, that the material facts should be stated.
On December 1, 1919, the plaintiff entered into a written contract with the defendants for the purchase of a certain described parcel of real estate, and under the provisions of said contract, the plaintiff was entitled to possession of said premises on March 1, 1920, at which time the defendants were to execute to plaintiff a warranty deed, and furnish an abstract showing merchantable title and free from all liens and incumbrances. On March 6, 1920, the defendants executed and delivered to the plaintiff their warranty deed for the premises, at which time the plaintiff executed and delivered to the defendant Isabelle Morse his promissory note in the sum of $ 19,480, and, to secure said note, executed and delivered to said defendant his mortgage on said real estate. Plaintiff also paid to the defendants, at said time, including his initial payment, a sum aggregating $ 7,900. There was retained the sum of $ 100 of the purchase price until the defendant should furnish an abstract of title in accordance with the terms of the written contract. The abstract of title was not furnished at said time, but it was understood and agreed by the parties that an abstract should be furnished in conformity to the contract.
Plaintiff entered into possession of said premises about March 6, 1920. The defendants did not furnish plaintiff with any abstract of title until February, 1921. This abstract was rejected, because of its form and dilapidated condition. The new abstract was not furnished until the fall of 1922, and upon its examination shortly thereafter by plaintiff's attorneys, the defects complained of in this action were discovered, and this action was commenced.
The trial court determined that the defendants did not have such title, under the will of one C. A. Morse, deceased, that they could convey in conformity to the terms of their contract with plaintiff; that the contract should be rescinded; that plaintiff was entitled to recover the amount paid on the purchase price; and that the note and mortgage given for the balance of the purchase price should be canceled. He further determined other matters involved in the settlement, relative to value of crops received by plaintiff during his occupancy, taxes that had been paid, interest to be accounted for, depreciation of buildings and other appurtenances, and other items that were necessary to be taken into consideration in the accounting between the parties.
The defendants, by answer, interposed certain defenses which questioned the right of plaintiff to a rescission of the contract and the recovery of the purchase money paid by him.
I. It is first contended that there was a merger of the contract in the deed, and that plaintiff's only remedy for the alleged defect in title is on the covenants of the deed. It may not be questioned that, when a deed is accepted in compliance with the terms of a contract for the sale of real estate, the contract is merged in the deed. In the last analysis, it is a question of intent.
The defendant-vendor delivered to the plaintiff a dilapidated abstract of title. Plaintiff had the legal right to demand and receive a new abstract. Fagen v. Hook, 134 Iowa 381. The initial payment with the delivery of the note and mortgage was conditional. It was clearly understood to be so by the parties hereto. A merger was not intended. The case of McNair v. Sockriter, 199 Iowa 1176, 201 N.W. 102, is not analogous on the facts, and therefore not controlling. The written contract herein contemplated that an abstract should be furnished, showing good title to the lands conveyed, and, to insure the subsequent furnishing of such abstract, $ 100 of [212 N.W. 935] the purchase price was retained by the plaintiff. There was no waiver of any stipulation of the written contract. It was still executory in purpose and character. There is no showing that plaintiff knew the condition of the title. In fact, the interpretation of a will was originally involved in this case. Plaintiff, as a layman, necessarily depended on legal advice, and was entitled to act upon the opinion of his attorneys after an examination of the abstract by them.
The record discloses that the abstract was not fully examined by the attorneys until in the fall of 1922, and soon thereafter this action was commenced. A new and proper abstract was not furnished until sometime in the fall of 1922. The defendants were obligated to furnish a marketable title, which means such a title as could be sold to a reasonable purchaser, or mortgaged to a person of reasonable prudence, as security for a loan of money. Shreck v. Pierce, 3 Iowa 350; McGuire Bros. v. Blanchard, 107 Iowa 490, 78 N.W 231; Fagen v. Hook, supra; Curtis Land & Loan Co. v. Interior Land Co., 137 Wis. 341 (118 N.W. 853). Such a title was not...
To continue reading
Request your trial