Geiser Mfg. Co. v. Krogman
| Decision Date | 19 May 1900 |
| Citation | 82 N.W. 938,111 Iowa 503 |
| Parties | THE GEISER MANUFACTURING COMPANY, Appellant, v. HENRY KROGMAN AND FERDINAND KROGMAN |
| Court | Iowa Supreme Court |
Appeal from Osceola District Court.--HON. F. R. GAYNOR, Judge.
ACTION on three promissory notes made and executed to plaintiff by defendants Krogman. Defendants admit the making of the notes but plead an offset and counterclaim growing out of the sale of certain property under a mortgage given to secure the notes. There was a trial to a jury, resulting in a verdict and judgment for defendants and plaintiff appeals.
Reversed.
John McLennan and T. D. Hastie for appellant.
Milt H Allen for appellees.
On motion of appellees the evidence has been stricken from the record and we may only consider such of the assignments of error as arise upon the pleadings, the instructions, the verdict, and the judgment. It appears from the pleadings that on the fifth day of January the defendants made and executed to plaintiff their three promissory notes in writing for the sum of four hundred and ninety-one dollars and sixty-six cents each, due, one December 1, 1897, one December 1, 1898, and one December 1, 1899, each bearing seven per cent. interest. To secure these notes the defendant also executed a chattel mortgage on a traction engine and a separator that contained these, among other provisions "Until default in payment of the above notes, * * * said mortgagor may remain in possession of said * * * chattels, * * * but, if such default be made, or if said mortgagee, * * * with or without apparent cause, feel insecure, then the said mortgagee shall have the right to declare all the above notes due, and may, without suit, take possession of the * * * chattels, * * * and sell the same at public sale without any liability for real or supposed damages; and at such sale the Geiser Mfg. Co. may become the purchaser, and said mortgagee may retain the amount of said note or notes and all the expenses, * * * and apply net proceeds as mortgagee may elect, and pay the surplus to said mortgagors." June 25, 1897, plaintiff took possession of the mortgaged property, and sold the same at public sale for the sum of eight hundred dollars, it being the purchaser. From the amount of the bid it deducted the sum of thirty-five dollars, and credited the balance on the three notes hitherto mentioned. Defendants filed an answer and counterclaim consisting of six divisions. The first was an admission of certain facts recited in the petition. The second was a claim that the amount charged as expense, to-wit, thirty-five dollars, was exorbitant, and that five dollars was a reasonable price. The third charges that when plaintiff took possession of and sold the mortgaged property nothing was due on the notes, and that plaintiff did not feel itself insecure, and had no reason for declaring the indebtedness due; that in taking possession of and selling the property plaintiff acted maliciously, and with intent to wrong defendants, and that by reason of the said sale defendants were damaged in the sum of five hundred dollars in being deprived of the use of the machine; and they asked the further sum of one thousand dollars as exemplary damages. In the fifth division they pleaded as a separate defense that plaintiff, in selling the property under the mortgage, bid in the same at a wholly inadequate price, and wrongfully and fraudulently and with intent to cheat took no steps to procure bidders, or to procure a fair price for the property, and by reason thereof damaged defendants in the sum of one thousand one hundred dollars. In the fifth division they alleged that prior to the execution of the notes in suit defendant executed other notes to plaintiff for the purchase price of the separator included in the mortgage, and they asked that plaintiff be required to produce the notes in order that the damages awarded them on their counterclaims might be applied on said notes, and they asked that, after allowing the amount claimed, they have judgment for the sum of one thousand two hundred dollars. A demurrer to these divisions of the answer was filed by the plaintiff, but the same was overruled, and thereafter defendants added a sixth division to their counterclaim, in which they charged by way of further counterclaim that at the time plaintiff took possession of and sold the property no part of the debt was due, and plaintiff had no reason for believing itself insecure; that in taking possession of and selling the property plaintiff acted maliciously, and with intent to cheat, wrong, and defraud the defendants; that it sold the property to itself at an inadequate price, and took no steps to procure bidders, or to secure a sale at a fair price; that, though there were no bidders aside from itself at the sale, it failed to postpone the sale, and wrongfully and fraudulently sold the property for an inadequate price; that, after becoming a purchaser at its own sale, it resold the property for about one thousand nine hundred dollars, and thereby obtained a profit of about one thousand one hundred dollars, for which sum they asked judgment. By subsequent pleading defendants amended division 3 by stating that plaintiff neglected to give proper notice of sale of the mortgaged property, and failed to conduct the sale as required by law, in that they did not serve notice on the mortgagors, failed to have the property appraised, and failed to post notices of sale. They also amended the fourth division of their answer by reciting the same facts, and charged that failure to give notice, etc., was in pursuance of the plaintiff's wrongful and malicious intent. They also amended the sixth division of their answer by reciting the same facts as set forth in the amendment to the fourth division. The prayer remained the same. Plaintiff then demurred to the sixth division of the answer and counterclaim, and to the amendment to which we have last referred, but the demurrer was also overruled. Thereafter plaintiff filed a reply denying all the material allegations of the different divisions of the answer; further pleading that the mortgaged property was taken by an agent under specific instructions to take the property; and that if he (the agent) acted maliciously, or wantonly injured defendants, it was beyond the scope of his employment, and plaintiff is not bound by his acts. It also denied malice, and pleaded advice of counsel, and that, when the defendant Henry Krogman purchased the machinery, he was the owner of one hundred and sixty acres of land, that he afterwards sold to his wife for the purpose of defrauding plaintiff. It also pleaded an estoppel that need not be further noticed. On these issues the case was tried to a jury, resulting in the verdict hitherto mentioned.
It will be noticed that each affirmative defense or cause of action in the counterclaim was stated in a distinct division of the answer, and purported to be sufficient in itself. This was as the statute requires, and we refer to the matter at this time in order that what follows may be better understood. By pleading over after the ruling on its demurrer, plaintiff waived the error, if any. Frum v. Keeney, 109 Iowa 393, 80 N.W. 507. The rulings did not constitute an...
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