Keeline v. Clark

• Decision Date: 08 March 1906
• Citation: 106 N.W. 257,132 Iowa 360
• Parties: AUGUSTA A. KEELINE, Appellant, v. A. A. CLARK, ET AL., Appellees
• Court: Iowa Supreme Court

106 N.W. 257

132 Iowa 360

AUGUSTA A. KEELINE, Appellant, v. A. A. CLARK, ET AL., Appellees

Supreme Court of Iowa, Des Moines

March 8, 1906

REHEARING DENIED, WEDNESDAY, NOVEMBER 21, 1906.

Appeal from Pottawattamie District Court.-- HON. A. B. THORNELL Judge

ACTION in equity to quiet title in plaintiff to certain real estate situate in the city of Council Bluffs. In a second count to the petition plaintiff claims that a deed purporting to convey the legal title to the property in question to defendant Clark, and under which he (Clark) claims title, was obtained from her by fraud and by force and duress, and further, that such deed was accepted and title thereunder taken and is now held by said Clark only by way of security for moneys loaned to her husband, W. C. Keeline. The prayer for relief is in the alternative -- that said deed may be declared void and her title quieted, or, if this be denied that it may be decreed that defendant holds title as for security only, and that the amount due him after deducting rents and profits may be ascertained, and that she be allowed to redeem the property. The answer of the defendant Clark, who alone appeared, asserts his ownership of the property under deed from plaintiff and her husband, and denies the other allegations of the petition. In a cross-petition defendant asks to have his title quieted, and that plaintiff, who by stealth and fraud has entered into possession of the property since his purchase and now has possession thereof, may be evicted. The trial resulted in a decree dismissing the petition of plaintiff, and granting to defendant the relief prayed in his cross-petition. Plaintiff appeals.

Reversed.

H. L. Robertson, for appellant.

Flickinger Bros. and John M. Galvin, for appellees.

OPINION

BISHOP, J.--

Up to September 24, 1901, the legal title to the real estate in question stood in the name of plaintiff, and for many years the property had been occupied by plaintiff, her husband, and their children as a homestead. On said date there was executed and delivered by plaintiff and her husband, W. C. Keeline, a conveyance of said premises, in form a warranty deed, to defendant Clark, subject, however, to three mortgages to E. E. Hart, aggregating $ 2,201.50, which mortgages, as provided in the deed, were assumed and agreed to be paid by Clark. Contemporaneous with said deed plaintiff and her husband executed a further writing as follows: "Having sold our home this day to A. A. Clark and having received the full consideration for same, we now agree to deliver up possession of the same to said Clark on or before October 15, 1901." Also contemporaneous with said writings, Clark executed and delivered to plaintiff and her husband an "option to purchase" the property in question within one year and for the sum of $ 1,300, plus taxes and interest which might be paid on the Hart mortgages. There is some controversy as to the amount paid by Clark to the Keelines at the time, but we think it fairly appears that the amount was $ 1,000. Within a few days after the transaction thus taking place the Keelines left for Colorado, and Clark took possession of the property through a tenant. Matters stood thus until in March, 1902, when W. C. Keeline having returned to Council Bluffs, he executed a note for $ 60 due September 24, 1902, to Clark, and among the provisions of such note was the following: "And to secure the payment of this note I hereby convey to the said payee an option given by A. A. Clark on premises," etc., making reference to the property in controversy. It is certain, however, that the option writing was not at the time delivered to Clark. In July, 1902, Clark executed a new "option to purchase." This provided that the Keelines might, on or before September 24, 1903, purchase the property in controversy upon payment of $ 4,800, plus taxes and interest which may have been paid on the Hart mortgages. "Clark to pay the principal of the Hart mortgages or deduct the balance due thereon from the $ 4,800 payable under the terms of this option, and such sums as may be paid for the care and repairs of said premises -- but not to exceed $ 100." The Keelines indorsed upon such writing an acceptance of the conditions thereof, and on the same day the old option was "for value received assigned to A. A. Clark." It is conceded by Clark that at the time, and for no other consideration, he paid to the Keelines the sum of $ 600 in money; that he delivered up to W. C. Keeline his note for $ 60 of date in March, 1902, and also forgave him a minor indebtedness for money borrowed of either $ 10 or $ 20, he does not remember which. September 29, 1903, W. C. Keeline appeared at the office of Clark in Council Bluffs -- plaintiff being still in Colorado -- having in his possession a power of attorney from plaintiff to lease, option, or sell the premises in controversy. On that day Keeline executed to Clark an instrument acknowledging receipt of the sum of $ 50 in part payment for all right, title, and interest of Augusta A. Keeline and W. C. Keeline in the premises in controversy -- designated in the writing as the tract "described in the power of attorney from A. A. Keeline to W. C. Keeline hereby attached." It is then provided that, in consideration of said sum and the further sum of $ 50 to be paid on delivery of deed, "the undersigned agree to convey to said Clark the above premises by deed of general warranty, except mortgages to Hart." The writing is signed by Keeline for himself, and as attorney for his wife. By deed bearing the same date, Keeline, acting for himself and as attorney in fact for his wife, executed and delivered to Clark a deed for the premises; such deed reciting a consideration of $ 100. The amount of money paid Keeline on this occasion is also in dispute.

I. Taking this fact outline as a basis, we may now go directly to the matters of contention as presented in argument. We shall not stop to question the correctness of the decree so far as it involves a finding that, upon the whole record, the court was not warranted in setting aside the deed of September, 1901, on the ground of duress. Suffice it to say that the evidence brings the question very close to the border line, and, if the finding of the court had been the other way, we should have hesitated long before disturbing it. Accepting of the initial deed, then, as voluntarily made, we have the question of the effect thereof -- whether it shall be given force as a matter of security for the payment of money, or, on the other hand, as an unconditional conveyance of the fee title. If the latter, of course the decree was right as a whole, and should be affirmed. If the former, then plaintiff should be decreed a reconveyance upon payment being made by her of the amount necessary to redeem. Without difficulty we reach the conclusion that the conveyance was intended for the purposes of security only, and hence should be treated as a mortgage. It seems to be the thought of counsel for appellee that the form adopted in the transaction -- that is, a deed unconditional on its face and a contract for resale separately executed -- forbids the conclusion that a mortgage only was intended. But such is not the rule in this State. A court of equity will inquire into the transaction, and, having ascertained the real intention of the parties from all the facts and circumstances, will decree the true character thereof; and it will be held a mortgage if the party asserting it to be so has sustained the burden which the law casts upon him of making proof; otherwise it will be declared what, upon its face, it purports to be, a sale with contract of repurchase. Bigler v. Jack, 114 Iowa 667, 87 N.W. 700. The subject was gone over and the authorities collected with such fullness in the opinion by Deemer, J., in the case cited, that we need not extend this opinion by further citation or discussion.

The circumstances of the instant transaction were these: W. C Keeline, the husband of plaintiff, was an habitual drunkard. He had squandered all his property, except an interest, as claimed by him, in a mine located in the State of Colorado. Being desirous of going to that State to look into his mining interest, he applied to defendant Clark for money, with the result that he went home and demanded of plaintiff that she consent to pledge the homestead as security for a loan. At first she refused, but finally yielded, under pressure of threats and acts of intimidation. The parties, husband and wife, then went to the office of Cook, and thence to an attorney's office, where the papers were drawn up. Plaintiff, as a witness, says that the only understanding she had of the transaction was that a loan was being made to her husband, to secure which she was pledging her homestead; that defendant so characterized the transaction. W. C. Keeline testified that he was intoxicated at the time; that so far...