Stimpson v. Pease

• Decision Date: 27 April 1880
• Parties: STIMPSON ET AL. v. PEASE ET AL
• Court: Iowa Supreme Court

5 N.W. 760

53 Iowa 572

STIMPSON ET AL. v. PEASE ET AL

Supreme Court of Iowa, Des Moines

April 27, 1880

Appeal from Lee Circuit Court.

ACTION to enjoin an execution sale. The property consists of certain real estate in the city of Keokuk. It was formerly owned by Henry Waterman, the execution debtor. Waterman executed two mortgages upon it, which mortgages became the property of the plaintiffs, H. M. Stimpson and B. F. Hambleton. After the execution of the mortgages the defendants S. C. & S. Carter obtained a judgment against Waterman, which became a lien upon the property. The execution sought to be enjoined was issued upon that judgment. The plaintiffs have never foreclosed. Waterman was adjudicated a bankrupt, and his assignee in bankruptcy conveyed the property to the holders of the mortgages in settlement. This was done with the approval of the court of bankruptcy, but the defendants S. C. & S. Carter were not parties to the proceedings. The holders of the mortgages, having taken a conveyance of the property sold and conveyed a part of it to Mary E. McClellan, who joins as plaintiff herein. She has made valuable improvements. The petition avers that the defendants are proceeding to sell under a claim that the judgment lien is paramount to the plaintiffs' claim, whereas plaintiffs say that the judgment lien was divested by the proceedings in bankruptcy, or, if not, that it is subject to the amount that would have been due them if no settlement had been made.

The defendants admit that they claim that their judgment lien is paramount, and aver that it is in fact paramount, and ask an adjudication in regard to the priority of their lien. The court held that it was not paramount, and rendered a decree that the defendants be perpetually enjoined from selling under a claim that their lien was paramount. The defendants appeal.

AFFIRMED.

W. B Collins, for appellants.

Gillmore & Anderson, for appellees.

OPINION

ADAMS, CH. J.

No copy of the execution is set out. We must assume that it was a general execution in the ordinary form. No claim of priority in respect to the lien of the judgment appeared, we suppose upon its face. Whether, if the lien was a subsisting one, the plaintiffs were entitled to an injunction to restrain the sale merely on account of a claim of priority set up extrinsic to the execution, and in no way affecting the substantial rights of any one, seems to us to be doubtful. But this question is not presented to us. The questions which the parties have made are as to the validity of the respective liens, and their priority. We have, then, to consider the effect of the settlement made by the holders of the mortgages with the assignee in bankruptcy, and the approval of the court of bankruptcy. It was, doubtless, competent for the court of bankruptcy to order and approve a sale and conveyance of the property by the assignee to the holders of the mortgages in discharge of their claims, but such sale and conveyance would not have the effect to divest either prior or subsequent liens, where the lien holders were not made parties to the proceedings. Ray v. Norseworthy, 90 U.S. 128, 23 Wall. 128, 23 L.Ed. 116. The appellees, while not denying this rule, as we understand, insist...