Theisen v. Dayton

• Decision Date: 31 January 1891
• Citation: 82 Iowa 74,47 N.W. 891
• Parties: THEISEN v. DAYTON ET AL.
• Court: Iowa Supreme Court

82 Iowa 74

47 N.W. 891

THEISEN

v.DAYTON ET AL.

Supreme Court of Iowa.

Jan. 31, 1891.

Appeal from district court, Shelby county; GEORGE CARSON, Judge.

Action for judgment and foreclosure on two notes, and mortgage on certain lands, executed by defendants Dayton to A. K. Riley, of which plaintiff alleges he is the owner. Appellant Byam, being made a defendant, as having some interest, answered denying plaintiff's ownership, and alleging that the notes were fully paid to Riley. Other allegations in the answer are without any proof to sustain them, and are therefore not noticed. Decree was entered for plaintiff, and the defendant Byam appeals.Foss & Stuart, for appellant.

E. A. Babcock, for appellee.

GIVEN, J.

1. The following facts are established by the testimony: The notes and mortgage in suit were executed by Dayton and wife, February 27, 1884, and became due one year thereafter. The mortgage was junior to one executed by Dayton and wife to appellant, and to one prior thereto, securing $2,000. Dayton executed to Riley, as further security for the $300 named in the notes, his mortgage on certain chattel property. On January 18, 1886, Dayton sold the mortgaged property to one John Dierks, and conveyed the land by quitclaim deed for the consideration of $100, he (Dierks) assuming and agreeing to pay the mortgage debts. October 21, 1886, Byam took a decree foreclosing his mortgage, in an action wherein Dierks was a party, and purchased the land at execution sale for $1,222.92, and before the commencement of this action received a sheriff's deed therefor. February 9, 1887, Dierks conveyed the land by quitclaim deed to appellant, in consideration of $297, and part of the chattel property, and surrendered possession to him. At some time after his purchase from Dayton, Dierks took up the notes in suit from Riley, without any indorsement thereon, and thereafter transferred them, after due, without indorsement, to the plaintiff, Theisen, in payment of a debt; Theisen taking them without notice of Dierks' agreement to pay them. While it does not appear exactly when nor how Dierks took up the notes from Riley, there is no doubt but that he did so, and we presume that it was by payment in money or other acceptable satisfaction to Riley. It is evident from the testimony of Warren Gammon, and the circumstances, that Dierks intended and attempted, as he expressed it, “to keep this mortgage alive,” and make the land still chargeable therewith, and that Riley was retained by him as his attorney, to assist in doing so, and that the mortgage was left open and unsatisfied on the record for that purpose. It does not appear whether Byam knew of Dierks' agreement to pay the notes or not, at the time he purchased from Dierks. The value of the land is shown to have been about $3,500, and the cost to Byam $3,499.92, being his own and the prior mortgage and the $297 paid to Dierks.

2. It will be seen from the foregoing statement of facts that the controlling question is whether the payment of the notes to Riley by Dierks is a satisfaction thereof as to the plaintiff, Theisen. That it is a satisfaction as to Dierks can hardly be questioned, for, by his agreement to pay the mortgage debts, Dayton became primarily liable therefor; it became his duty to pay the debts absolutely and before all others. He did not stand in the relation of one secondarily liable, and therefore not entitled, upon payment, to be subrogated to the rights of the mortgagee. 3 Pom. Eq. Jur. § 1213; 2 Pom. Eq. Jur. § 797; Johnson v. Walter, 60 Iowa, 315, 14 N. W. Rep. 325; 1 Jones, Mortg. §§ 740, 741, 943. It is very clear that the payment to Riley was an extinguishment of the notes and mortgage, and that Dierks could not recover thereon. It is contended on behalf of appellee that, as he took the notes and mortgage for value and without notice of Dierks' agreement to pay the same, he took them free from any defense, arising out of that agreement, though taken after maturity. Crosby v. Tanner, ...