First National Bank of Shenandoah v. Le Barron
| Decision Date | 06 April 1926 |
| Docket Number | 37184 |
| Parties | FIRST NATIONAL BANK OF SHENANDOAH, Appellee, v. E. S. LEBARRON, Appellant, et al., Appellee |
| Court | Iowa Supreme Court |
Appeal from Page District Court.--EARL PETERS, Judge.
ACTION on a promissory note. The opinion states the facts. From a judgment against him, the defendant LeBarron appeals.
Reversed.
Ferguson Barnes & Ferguson, for appellant.
Wilson & Keenan, for appellees.
VERMILION J. DE GRAFF, C. J., and STEVENS and FAVILLE, JJ., concur.
The action is at law, to recover the amount due on a promissory note. A jury was waived, and the cause tried to the court.
The note sued on, for $ 670, was executed by one Stoddard and the appellant, LeBarron, to the defendant and appellee, Henry Field, as payee, and by Field indorsed, and turned over to the plaintiff bank.
The facts leading up to the execution of the note, out of which this controversy arises, are not in dispute. Stoddard purchased of Field certain real estate on written contract, for $ 6,400. According to the contract, the payment of $ 1,200 was acknowledged in two notes given by Stoddard for $ 600 each, upon which appellant was guarantor. The balance of the purchase price was to be paid in annual installments of $ 600 until the "principal" was so reduced that Field would be willing to execute a deed and carry the balance on a mortgage. Time was expressly made the essence of the contract, and it provided for a forfeiture, at the option of the seller, of all payments made, for a failure by the purchaser to make the payments provided for or to perform the covenants of the contract.
The two notes for $ 600 were executed by Stoddard and the appellant, and sold by Field to the plaintiff bank. The note first due has been paid, and the second renewed one or more times. The note in suit is the last renewal. Stoddard moved off the land, and left the state. Field, without taking any steps to cut off Stoddard's rights under the contract, by enforcing a forfeiture or otherwise, sold and conveyed the land to a third party, after the execution of the note in suit.
This action was originally commenced by Field; but the bank was substituted as plaintiff, and, in an amended and substituted petition, made Field a party defendant, asking judgment against him on his indorsement of the note. Field answered, admitting his liability, alleging that appellant was primarily liable, and praying that the judgment so show, and that he be subrogated, in case of payment by him, to the right of the plaintiff against appellant.
Appellant answered, setting up the contract between Field and Stoddard, alleging that he was but a surety on the note; that Field had a vendor's lien on the land, to secure the note, which he released without the knowledge or consent of appellant, by conveying the land; and that thereby appellant, as surety, was released. Appellant further pleaded that the contract between Field and Stoddard had been rescinded, and that Field had, therefor, no right to recover on the note a portion of the consideration for the land. Appellant also filed a cross-petition against Field, containing the same allegations, and praying that, in case he was held liable on the note to the plaintiff, his liability be adjudicated to be secondary, and that he have judgment over against Field. Field answered the cross-petition with a general denial.
The judgment below was against both appellant and Field, and determined that the latter's liability was secondary to that of appellant. Field has paid the judgment, taking an assignment thereof from the bank; so that the plaintiff is now out of the case.
In this situation, the only question before us is, Where, as between appellant and Field, does the primary liability rest? The liability of Field, as an indorser of the note, would be secondary to that of appellant, as a maker, if that were the only relation of the parties. But, if appellant was under no liability to Field on the note, the...
To continue reading
Request your trial