Rouse v. Rouse
| Decision Date | 10 February 1970 |
| Docket Number | No. 53616,53616 |
| Citation | 174 N.W.2d 660 |
| Parties | Bert BOUSE, Plaintiff-Appellant, v. Eldon ROUSE & Daisy Rouse, Defendants-Appellants, Farmers Cooperative Elevator Company of Ruthven, Iowa, Defendant-Appellee, R. O. Miller, Sheriff of Palo Alto County, Iowa, Defendant, Alvin Rouse, Intervenor-Appellant. |
| Court | Iowa Supreme Court |
Arthur W. Smith and Hanson & Bormann, Emmetsburg, for appellant Bert rouse.
Linnan, Lynch & Straub, Algona, for appellants Eldon and Daisy Rouse.
Fitzgibbons Bros., Estherville, for appellee.
Cornwall, Avery & Berg, Spencer, for intervenor-appellant.
Judgment debtors, and their security holding relatives, appeal from trial court's decree overruling their objections to appointed receiver's report, and according priority to a judgment creditor's lien. We affirm in part, reverse in part.
May 26, 1967, Farmers Cooperative Elevator Company of Ruthven, Iowa, obtained judgment for.$9,927.58, in cause No. 18533, against Eldon and Daisy Rouse.
June 10, 1967, those judgment debtors executed promissory notes, security agreements, and financing statements apparently encumbering all personalty owned by them. These instruments, recorded June 12, 1967, served to secure payment of $15,000 to Bert and $4000 to Alvin Rouse, they being Eldon's father and brother, respectively.
The judgment creditor caused three executions to issue, the first June 13, the second October 10, 1967. Though not released on demand, they were later returned unsatisfied.
December 1, 1967, a third execution issued. Thirteen days later a release demand was given. This time the elevator company elected to proceed and, on notice, filed an indemnifying bond. (section 626.54, Code, 1966). The property levied upon consisted of: '36 Hol. milk cows, 4 Hol. feeders, 1 steer, 25 hogs, 1 Hol. bull, 6 black Hol. calves, 500 bu. corn, 300 bu. oats.'
January 15, 1968, the personalty described above, included in the security transactions, supra, was sold for $6800 at sheriff's sale to the elevator company.
The same day Eldon Rouse prevented delivery of the property by barricading his farm lane.
Simultaneously Bert Rouse, the father, commenced a mortgage foreclosure action, cause No. 18713, aided by an ex parte injunction, the sheriff and judgment creditor being thereby restrained from taking possession of the property sold as aforesaid.
The next morning counsel for the elevator appeared in open court with Bert's attorney, who had previously, and at that time, arguendo, represented Eldon and Daisy. On oral motion by the elevator company, in connection with cause No. 18713, trial court then dissolved the injunction referred to above, and appointed a receiver with instructions he promptly sell all personalty subject to the judgment lien.
That same day the receiver sold all grain to the elevator company, and January 17th caused the livestock seized to be disposed of at public auction. From these sales the receiver apparently realized a total of $9,158.30.
Pursuant to court order, notice of hearing on the receiver's report was given all parties in interest, including Alvin Rouse. Objections were then filed by Bert, Alvin, Eldon and Daisy. Bert thereby challenged jurisdiction of the court to appoint a receiver and asserted his claimed priority rights under the security instrument held by him. Eldon and Daisy, judgment debtors, in objecting to the receiver's report, for the first time protested sale of property exempt to them and joined in disputing authority of the court to appoint a receiver. Alvin's objection discloses an election to stand only on his rights as a security holder, claiming he should be accorded preference over the elevator's judgment lien. The elevator company, by answer, controverted Bert and Alvin's right to any proceeds realized from the receiver's sales, and asked that all net funds on hand be delivered to it.
Trial court overruled the priority claims advanced by Bert and Alvin, and ordered disbursement of funds held by the receiver in this manner:
(a) Charles H. Barlow, receiver
Fees $ 445.00
Expenses 92.76
(b) Sheriff R.O. Miller
222 miles at 10 cents a mile 22.20
(c) Beryl Rupp Insurance Agency, Emmetsburg
Iowa, premium for receiver's bond 50.00
(d) Greater Iowa Corporation (by stipulation
draft to be payable jointly to Greater Iowa
Corporation and Carl L. Spies, its attorney, and
mailed to counsel) 479.00
(e) Eldon Rouse, defendant (gross proceeds from
sale of exempt property; draft to be payable
jointly to Eldon Rouse, Daisy Rouse and Linnan,
Lynch & Straub, their attorneys, and mailed to
counsel) 1,522.90
(f) The costs of this action, to be computed by the
clerk, in the sum of $73.50, are taxed one-third to
the receivership property and to be paid therefrom
(one-third of costs) 24.50
(g) The remaining balance on hand after payment
of the above amounts is to be paid to the Farmers
Cooperative Elevator Company of Ruthven,
Iowa, with draft payable jointly to Farmers
Cooperative Elevator Company of Ruthven, Iowa,
and Fitzgibbons Bros., their attorneys, and
mailed to counsel. $6,521.94
It is at once evident this case turns largely upon a complicated factual situation.
There is some overlapping of the multiple propositions urged by appellants and in the interest of brevity they are not now specified but will be later accordingly considered.
I. Our review is de novo. When considering credibility of witnesses we accord weight to trial court's fact findings but are not bound by them. Rule 344(a)(3) and (f)(7), Rules of Civil Procedure.
II. It should at the outset be noted, by way of exclusion, this court is not here concerned with any action in tort for abuse of process, or with proceedings for recovery upon the indemnifying bond filed in cause No. 18533 by the judgment creditor. No such issues were pled, presented to, entertained or considered by the trial court, and cannot be raised here for the first time. See Volkswagen Iowa City, Inc. v. Scott's Inc., Iowa, 165 N.W.2d 789, 794, and Verschoor v. Miller, 259 Iowa 170, 176, 143 N.W.2d 385.
III. Foremost among the problems posed is trial court's jurisdiction to appoint a receiver.
It appears Bert Rouse alone, in objecting to the receiver's report, questioned mechanics of the application upon which a receiver was assigned, i.e., by motion rather than petition. See Code section 680.1. But at time the request was made, his attorney, being present in court, made no such specific objection. In other words, he delayed voicing actual complaint in this regard until a receiver had not only been named but fully performed his duties, except for effecting final distribution.
As revealed infra, trial court had requisite jurisdiction to act. And by reason of the extraordinary factual situation involved it was confronted with an emergency. The conditions existing left little or no choice for the court but to act in protection of the interests of all concerned.
Another factor which, though not alone determinative, still materially reduces the force and effect of Bert's complaint, is that in his mortgage foreclosure action he too requested appointment of a receiver. And, whether such custodial officer be appointed on application by him, or the elevator, the net result would be the same with respect to priority rights as between claimants.
Furthermore, all parties concerned apparently concede a judgment creditor has standing to seek such protective relief regarding personalty subject to its lien. See 75 C.J.S. Receivers § 11, page 670, and 45 Am.Jur., Receivers, section 13, page 22.
Also, as this court said in Chicago, R.I. & P.R. Co. v. Linwood, etc., Co., 258 Iowa 1378, 1381, 138 N.W.2d 902, 903:
Without placing the stamp of approval on use of a motion in lieu of petition for appointment of a receiver, we believe trial court had inherent authority to act; its action was not void, being at best only voidable; the objection urged by Bert was not timely made; and trial court, here clearly had not only the right but permissive duty to act. See in this vein 75 C.J.S. Receivers §§ 34--36, pages 696--698, and 88--90, pages 732--736.
IV. Actually the complaint first voiced here by judgment debtors and claimed security holders alike is to the effect they neither received notice of the elevator company's application for appointment of a receiver, nor were accorded opportunity to be heard on it.
As heretofore disclosed, judgment had been entered in cause No. 18533, execution issued, levy made, and a sheriff's sale effected prior to presentation of the receivership motion by the elevator company in Bert's foreclosure action.
Moreover, trial court was advised, and found in effect, an emergency condition then existed in that livestock involved was jeopardized and depreciating in value; no judge would be available to entertain the application for at least one week; the elevator company was entitled to immediate possession of the property levied upon for protection of its exercised judgment lien; and appointment of a receiver would not materially prejudice the rights of any party.
Code section 680.1, as amended, provides in part: '* * * On such notice to the adverse party as the court or judge shall prescribe, the court, * * * if satisfied that the interests of one or both parties will be thereby promoted, and the substantial rights of neither unduly infringed, may appoint a receiver to take charge of and...
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