Merritt v. Interstate Power Co.

Citation261 Iowa 174,153 N.W.2d 489
Decision Date17 October 1967
Docket NumberNo. 52606,52606
PartiesGilbert MERRITT, and Gilbert Merritt, Jr., Appellants, v. INTERSTATE POWER COMPANY, a corporation, Appellee.
CourtUnited States State Supreme Court of Iowa

William T. Connery, Dubuque, for appellants.

O'Connor, Thomas, Wright, Hammer & Bertsch, Dubuque, for appellee.

MASON, Justice.

In January 1964 Interstate Power Company condemned an easement across land in Dubuque County owned by Gilbert Merritt and tenanted by Gilbert Merritt, Jr., for the purpose of erecting electric transmission lines and other related public utility facilities and purposes. The tract of approximately 400 acres had been mortgaged November 30, 1954, to American Trust & Savings Bank, Dubuque, as shown by the records in the recorder's office. February 4, 1964, a condemnation jury made a joint award of $1575 to the landowner, tenant and mortgagee.

Section 472.21, Code, 1962, requires condemnation appeals to the district court be docketed showing the condemnee as plaintiff and condemnor as defendant.

February 29 plaintiffs filed in the Dubuque district court their petition on appeal from the award and served notice of appeal upon Interstate Power and the Dubuque sheriff. The mortgagee did not join in the appeal and was not served with notice thereof at any time.

Interstate filed motion to dismiss, asserting the district court lacked jurisdiction to hear the appeal since a mortgagee had not been served with notice thereof as an adverse party as required by Code section 472.18. After the trial court overruled the motion defendant filed answer and plaintiffs their reply. Interstate then filed a motion to adjudicate law points under rule 105, Rules of Civil Procedure. Plaintiffs filed resistence.

The trial court dismissed plaintiffs' appeal on the ground it had no jurisdiction to hear the same because of plaintiffs' failure to serve the mortgagee with notice as required by the Code section. Plaintiffs appeal from the trial court's ruling.

I. In answer Interstate alleged existence of the mortgage at commencement of condemnation proceedings, that it remained unsatisfied of record when the award for the easement was made and plaintiffs' failure to serve notice on the mortgagee within a 30-day period from the February 4 award. Plaintiffs in reply admitted the existence of the mortgage and their failure to serve notice of appeal on the mortgagee but contended this had no application or legal significance.

At the hearing under rule 105, R.C.P., it was stipulated that on February 29 there was an unpaid principal balance and interest of $2557 owing the mortgagee which was paid off May 14 and released of record May 15. The trial court sustained defendant's objection to plaintiffs' offer of evidence on farm valuation.

Plaintiffs' appear presents the propriety of the dismissal on the ground the mortgagee was an adverse party upon whom notice of appeal was required. Other issues presented are whether the court erred in rejecting evidence on valuation of the farm and whether the adverse party issue became moot when the mortgage was paid off and released May 15.

Plaintiffs' assert the court erred (1) in finding the mortgagee would be adversely affected by reversal or modification of the condemnation award and was an adverse party upon whom notice was required, (2) in failing to take into consideration the unpaid mortgage balance and the value of the real estate where the easement was being procured, (3) in rejecting evidence of value of the tract to aid in determining whether the mortgagee was adversely affected, (4) in failing to consider whether plaintiffs' interest as landowner was fully protected under eminent domain and our constitution and (5) in not determining whether failure to serve the mortgagee became moot when the mortgage was satisfied before the hearing on law points.

II. We think the first three assigned errors are answered by at least three of our recent decisions.

Section 472.18 provides: 'Any party interested may, within thirty days after the assessment is made, appeal therefrom to the district court, by giving the adverse party, his agent or attorney, and the sheriff, written notice that such appeal has been taken.'

The jurisdiction of the district court in condemnation cases is appellate only and the notice required by section 472.18 is a notice of appeal. Harrington v. City of Keokuk, 258 Iowa 1043, 1046, 141 N.W.2d 633, 636; Scoular-Bishop Grain Co. v. Highway Commission, 258 Iowa 1003, 1006, 140 N.W.2d 115, 117; Bisenius v. Palo Alto County, 256 Iowa 196, 198, 127 N.W.2d 128, 130.

The right of appeal is purely a creature of statute. If an appeal is to be taken notice thereof must be given in substantial compliance with the statute. Failure to serve an adverse party within the time provided by section 472.18 is fatal to the jurisdiction of the district court. Griffel v. Northern Natural Gas Co., 257 Iowa 1140, 1145, 136 N.W.2d 265, 268, and citations; Scoular-Bishop Grain Co. v. Highway Commission, supra.

Plaintiffs contend Interstate is the only adverse party since reversal or modification of the $1575 award could not adversely affect the holder of a mortgage on a 400-acre farm, with a balance of $2557, which was paid off before the hearing under rule 105.

The test usually applied in determining who is an adverse party in such matters is whether he will be prejudiced or adversely affected by a reversal or modification of the judgment appealed from. Bales v. Iowa State Highway Comm., 249 Iowa 57, 63, 86 N.W.2d 244, 248; Griffel v. Northern Natural Gas Company, supra, 257 Iowa at 1144--1145, 136 N.W.2d 265, 268 and citations; Bisenius v. Palo Alto County, supra, and citations.

It is settled in Iowa that a mortgagee is an adverse party upon whom notice of appeal must be served when a condemnation award is appealed to the district court. Scoular-Bishop Grain Co. v. Highway Commission, supra, 258 Iowa at 1005, 140 N.W.2d at 117, and citations.

Bisenius v. Palo Alto County, supra, 256 Iowa at 200, 127 N.W.2d 128, notes that except for Lance v. Chicago, Milwaukee & St. Paul R. Co. (1882), 57 Iowa 636, 11 N.W. 612, and Dixon v. Rockwell, Sac & Dacota Railway Company (1888), 75 Iowa 367, 39 N.W. 646, no authority was found that a joint award mortgagee is not an adverse party. In those two cases the owner served notice on the mortgagee after the motion to dismiss was filed. Whether that affected the decision is not clear.

Plaintiffs contend this is not always true. They argue that in determining whether the mortgagee bank was an adverse party the amount of unpaid balance existing on the mortgage, the amount of the award, the value of the property and type of condemnation are all factors to be considered in determining whether a mortgagee is an adverse party and, therefore, they should have been permitted to offer evidence of the farm valuation.

A similar contention was rejected in Bisenius v. Palo Alto County, supra, 256 Iowa at 198, 127 N.W.2d at 129. There the landowner argued the mortgagee was not affected because he had the remaining security and the personal liability of the mortgagors. We said, 'Of course he (mortgagee) has such security. But that does not affect the result that the joint award mortgagee will be prejudiced by an award lower than the amount of its mortgage. This is not dependent on fact allegations showing prejudice but appears as a Matter of law from the fact of a joint award to an owner and a mortgagee' (Emphasis supplied).

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5 cases
  • Cedar Rapids Steel Transp., Inc. v. Iowa State Commerce Commission
    • United States
    • United States State Supreme Court of Iowa
    • September 5, 1968
    ...of appeal is purely a creature of statute. Carmichael v. Iowa State Highway Commission, Iowa, 156 N.W.2d 332, 335; Merritt v. Interstate Power Co., Iowa, 153 N.W.2d 489, 492; and 2 Am.Jur.2d Administrative Law, section 557, page And a search of Code chapter 327 fails to reveal appellate rev......
  • Carmichael v. Iowa State Highway Commission, 52730
    • United States
    • United States State Supreme Court of Iowa
    • February 6, 1968
    ...1003, 1006, 140 N.W.2d 115, 117; Harrington v. City of Keokuk (1966), 258 Iowa 1043, 1046, 141 N.W.2d 633, 636; Merritt v. Interstate Power Co. (Iowa 1967), 153 N.W.2d 489, 492. Only by the process of appeal does the district court obtain jurisdiction over both the subject matter and the Mo......
  • Yoder v. Iowa Power & Light Co., 55821
    • United States
    • United States State Supreme Court of Iowa
    • February 20, 1974
    ...Alto County, 256 Iowa 196, 127 N.W.2d 128; Johnson v. Iowa State Highway Comm., 257 Iowa 810, 134 N.W.2d 916; Merritt v. Interstate Power Co., 261 Iowa 174, 153 N.W.2d 489; and 21 C.J.S. Courts § 70, p. Clearly, the Federal Land Bank Association had no interest in the land over and across w......
  • Kenkel v. Iowa State Highway Commission
    • United States
    • United States State Supreme Court of Iowa
    • November 12, 1968
    ...1006, 140 N.W.2d 115, 117; Harrington v. City of Keokuk (1966), 258 Iowa 1043, 1046, 141 N.W.2d 633, 636; and Merritt v. Interstate Power Co. (Iowa 1967), 153 N.W.2d 489, 492. Only by the process of appeal does the district court obtain jurisdiction over both the subject matter and the 'Mor......
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