Northwestern Nat. Bank v. Sloan
| Decision Date | 03 February 1896 |
| Citation | 66 N.W. 91,97 Iowa 183 |
| Parties | THE NORTHWESTERN NATIONAL BANK v. HELEN E. STONE AND JAMES B. SLOAN, Appellants |
| Court | Iowa Supreme Court |
Appeal from Woodbury District Court.--HON. SCOTT M. LADD, Judge.
ACTION for the foreclosure of a mortgage. Judgment for plaintiff and defendants appealed.
Reversed.
Swan Lawrence & Swan for appellants.
Lewis & Holmes for appellee.
In 1887, the defendants made of the Lombard Investment Company a loan of five thousand dollars, and secured the same by a mortgage on two quarter sections of land. May 17, 1890, the defendants sold the land to Douglas Armstead, for a consideration of forty-eight thousand dollars. Of the amount, seven thousand dollars was paid in hand, a note for thirty-six thousand dollars was given to Sloan, secured by a mortgage on the land, and an agreement, by Armstead, to pay the five thousand dollar note to the Lombard Investment Company. May 19, 1890, Armstead conveyed the land to William Gordon, for Gordon and D. T. Hedges. This conveyance was subject to both the Sloan and the Lombard Investment Company mortgages. On the fourth day of May, 1892, Gordon, by written contract, sold to D. T. Hedges his interest in the land, subject to incumbrances thereon, amounting to forty-one thousand dollars, and six months' interest and taxes. The deed, at the request of D. T. Hedges, was made to W. V. Hedges, as trustee. The Lombard Investment Company note and mortgage is now held by the plaintiff bank, and this action is to foreclose the mortgage, and a personal judgment is asked against the defendant Sloan, who alone answers; although others are made defendants. The answer presents a plea of payment, and the issue thereon presents the only question on this appeal, and that question is mainly one of fact.
The particular fact relied on as constituting the payment is that, about August 1, 1892, D. T. Hedges paid to the Lombard Investment Company, the amount of the note, and it was delivered to him. This fact is not questioned, but the dispute is as to the legal effect of the transaction, in view of the circumstances under which the money was paid. There is no claim that, in the deed from Armstead to Gordon, or the contract of sale from Gordon to Hedges, there was, in terms an agreement to pay the note in question. It is however, claimed that, in each of the two sales, this five thousand dollars constituted a part of the consideration agreed to be paid for the land. In appellee's argument there is a concession that, "if, in such trade, the note was in fact regarded by the parties to the trade as a part of the consideration, that then the note should be considered paid." This brings us to the particular question of what construction is to be placed on the act of Hedges in paying the money to Lombard Investment Company. It is appellants' thought that it was done because it was a part of the consideration agreed upon. Appellee's thought is that the transaction on the part of Hedges was a purchase of the note with a view to protect the equity in the land. It appears in evidence that, when the deed was made by Gordon to W. V. Hedges, trustee, D. T. Hedges anticipated the formation of a syndicate that would take the land and plat and sell it; that he purchased the land with that in view; and that he had agreed to protect the land from the liens thereon. It is said that he took up the mortgage for that purpose. No syndicate was ever formed, and the legal title to the land is in W. V. Hedges, in trust for D. T. Hedges. It seems to us that there is no reasonable view of the evidence, to warrant a conclusion but that both Gordon and D. T. Hedges bought this land subject to the five thousand dollar note and mortgage as a part of the...
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