Iowa Methodist Hospital v. Long

• Decision Date: 14 December 1943
• Docket Number: 46383.
• Parties: IOWA METHODIST HOSPITAL v. LONG et al.
• Court: Iowa Supreme Court

12 N.W.2d 171

234 Iowa 843

IOWA METHODIST HOSPITAL v. LONG et al.

No. 46383.

Supreme Court of Iowa

December 14, 1943

Rehearing Denied March 10, 1944.

Ryan & Ryan, Lehan T. Ryan, and Ronald L. Ryan all of Des Moines, for defendants-appellant.

C W. Harvey, of Des Moines, for plaintiff-appellee.

MANTZ Justice.

On April 15 1942, in the Municipal Court of the city of Des Moines, Iowa plaintiff obtained a judgment against the defendant, Homer R. Adcock, for the sum of $228.50 with 5% interest from date, and costs. On April 15, 1943, an execution was issued on said judgment and on April 24, 1943, pursuant to court order defendant was examined before a referee concerning his property and particularly with regard to certain United States Savings bonds; this hearing was by agreement of the parties continued until June 15, 1943, when the defendant was further examined upon said matters. Thereafter, the matter was submitted to the lower court and on July 25, 1943, that court entered an order holding that the defendant was the owner of the bonds involved and that all bonds purchased by him out of his wages 90 days prior to June 15th were exempt to him as the head of a family and that the balance of the bonds not declared exempt be sold by the defendant and that he pay into the office of the clerk of the municipal court the proceeds thereof on or before noon of the 30th day of July, 1943.

Both parties have appealed, the defendant from the action of the court finding him to be the owner of all of the bonds and ordering him to sell certain of them and turn over to the clerk the proceeds of such sale; and the plaintiff from the order of the court finding that certain bonds were exempt to defendant as the head of a family. The defendant having first perfected his appeal will be referred to herein as appellant and plaintiff as appellee.

The abstracts do not set forth the entire proceedings had in the municipal court prior to the examination of the appellant before the referee on April 24, 1943. The application to the municipal court asking for examination of the debtor (appellant) and order of the court granting such application are not shown; neither is there shown the execution which had been issued prior to that time. There is some statement in argument that the execution had been issued but that same had been returned "unused".

Appellant claims that the appellee did not follow the proper statutory method herein, in that he proceeded under the terms of section 11805, Chapter 502, Code of 1939, instead of section 11648, Chapter 498 of such Code, and claims that section 11805 proceeded under cannot be properly used in the case and therefore the court was in error in making the order and judgment. There is no showing in the record that such contention of the appellant was ever called to the attention of the lower court or that he made any objections to the proceedings at any time prior to the appeal. Boiled down, it is the claim of appellant that before appellee could properly proceed under Chapter 502 of the Code there must have been a showing that an execution was issued and that the same was returned unsatisfied. According to the arguments of both parties an execution was issued but such instrument is nowhere set out in the record; neither is the return thereon set out. Appellant has made no showing that an execution was not issued and does not dispute the argument of appellee that one did issue; therefore, we hold that a presumption arises that there was a legal regularity in that respect. However, the record does show that when appellant was being examined by the referee on April 24, 1943, he stated on cross-examination:

"Q. Do you have all of these bonds in some place where they are obtainable so we can get them? A. Yes.

"Q. Are you willing to bring these bonds to the office of the bailiff of this court and turn them over to him to be levied on in this case or to turn them over to the bailiff if he calls at your home? A. No."

He was then asked the following question: "Are you ready and willing and have you always been ready and willing to hold these bonds to be subject to any proper orders or proper levies or anything else that is proper and legal? A. Yes."

It is quite evident from these statements of appellant that even had an execution on the judgment been presented to him he would not have turned over to the officer the bonds involved.

This proceeding was brought under Chapter 502 designated as "proceedings auxiliary to execution." Section 11805 of said chapter is as follows: "Disposition of property. If any property, rights, or credits subject to execution are thus ascertained, an execution may be issued and the same levied upon. The court or judge may order any property of the judgment debtor not exempt, in the hands of himself or others, or due him, to be delivered up, or in any other mode applied towards the satisfaction of the judgment."

It will be noticed that such section is in two parts and it provides two methods for the disposition of property. According to its terms when property, rights or credits subject to execution are by examination ascertained an execution may be issued and the same levied upon. It then provides that the court or judge may order any property of the debtor, not exempt, in the hands of himself or others, or due him, to be delivered up or in any other mode applied towards the satisfaction of the judgment. It will be observed that this section contemplates that following the hearing wherein the debtor is examined and property is revealed, the court, in its discretion, may order such property not exempt from execution to be delivered up or in any other mode applied toward the satisfaction of the judgment. Upon the examination of the judgment debtor, if it appeared therefrom that the debtor had property rights or credits subject to execution the court could then proceed (1) order an execution to issue and a levy made, or (2) make an appropriate order dealing with such property such as ordering it delivered up if in the hands of the debtor or in any other mode apply same towards the satisfaction of the judgment.

The examination revealed that the appellant was the owner of certain bonds, 14 in number, and thereafter the court made an order under the second alternative as set out above. We think that in so doing the court followed the plain intent of the statute.

II. The principal dispute as set out in argument relates to the ownership of the 14 defense bonds held by appellant at the time the case was tried in the lower court. That court in its judgment and decree on the question of the ownership of said bonds used the following language:

"The Court finds that all bonds that were purchased with wages earned within ninety days prior to June 15, 1943, are exempt to the defendant as the head of a family, on the same basis that money in the bank would be exempt, for the reason that these bonds are peculiar in that they are cashable in sixty days after their purchase. This provision in the bonds is new and probably never used in the United States before, therefore being liquid, could be treated as cash earned within the ninety days last past. The balance of the bonds, all of which are payable to the defendant or his wife, the Court finds are the property of the defendant; that a person must be just before he is generous; that these bonds cannot be cashed except upon the request or signature of the defendant or his wife. It is the opinion of the Court that the defendant could not place his property in any form so that it could not be reached by judicial process, or judicial order, to the end that it could not be applied upon a defendant's debts. In view of the fact that some of these bonds have not yet been delivered by the Government, and which in due course, will be delivered to this defendant,

"It is Therefore Ordered that the defendant sell the balance of the fourteen bonds heretofore not declared exempt to him, and pay the proceeds into the office of the Clerk of the Municipal court by noon of the 30th day of July, 1943."

The effect of this order was to hold that nine of the bonds held by appellant were liable to the satisfaction of appellee's judgment and that the remaining five were exempt to appellant as the head of the family as being purchased with his wages within 90 days prior to June 15, 1943.

The record shows that all of the 14 bonds were purchased and paid for out of the wages of appellant. The lower court found that appellant was the owner of all of them. We believe that there was ample evidence in the record to sustain the lower court in making such order. These bonds were acquired by reason of a 10% deduction from his earnings at the United States Rubber Company ordnance plant near Des Moines. Appellant stated that he had worked at such plant for about 17 months and that his average monthly earnings were $225 per month and that approximately 10% of such amount was deducted and used to purchase bonds for him. These bonds were issued to Homer R. Adcock, 2812 S.W. 12th Street, Des Moines, or Mrs. Dorothy B. Adcock. Each bond had a value of $25 at its ten year maturity date. Appellant at the examination on April 24, 1943, stated that the bonds held by him had an approximate value of $250, but at the later examination stated that by this he meant the maturity value. At the examination of appellant on April 24, 1943, concerning the ownership of these bonds he testified: "I work at the United States Rubber Plant and my salary is $225 a month."

"Q. Do you own any government bonds? A. Well, you mean like we take ten percent?

"Q. Yes. A. Yes.

"Q. How much do...