Van Staden v. Kline
| Decision Date | 12 June 1884 |
| Citation | 20 N.W. 3,64 Iowa 180 |
| Parties | VAN STADEN AND OTHERS v. KLINE AND OTHERS. |
| Court | Iowa Supreme Court |
OPINION TEXT STARTS HERE
Appeal from Winneshiek district court.
Action in chancery to foreclose a mortgage. There was a decree in which judgment was rendered against the mortgagors for the amount of the debt, and the mortgage was foreclosed as to all of the defendants, some of whom appeal. The facts of the case appear in the opinion.
Willett & Willett, for appellants.
Brown & Portman, for appellees.
1. The petition alleges that in 1866 a copartnership styled Kline & Johnson became indebted to plaintiffs in the sum of about $7,000, for money borrowed and personal property purchased. It is shown that Kline & Johnson were engaged in the brewery business, and the money so borrowed was used by them in payment for certain real estate devoted to the prosecution of their business, being the same property covered by the mortgage sought to be foreclosed in this action. The personal property was used in the same business. In 1871 Johnson died, and Kline continued the business as surviving partner or successor of the firm, in which he is still engaged. The real property whereon the brewery is situated, which is the property covered by the mortgage, constituted the greater part of the assets of the firm. No part of the indebtedness to plaintiffs has been paid. The widow and heirs of Johnson are made defendants, and it is shown that the widow is the executrix of his estate. In 1877 the defendant Kline, the surviving partner, for the purpose of extending time upon the notes given by the firm to plaintiffs, with his wife executed the notes and mortgage which are the foundation of this action. It is alleged that defendant Kline is insolvent, and that there are no assets of the firm of Kline & Johnson, except the real estate covered by the mortgage, out of which plaintiffs' claim can be made. Certain incumbrancers and creditors of the firm are made defendants, but no question arises in the case touching their interests. The petition prays for a foreclosure of the mortgage and for general equitable relief.
The widow and heirs of Johnson, in an answer and cross-bill, admit the copartnership existing between Kline and Johnson prior to June 12, 1871, and that the property covered by the mortgage was used in the prosecution of their business, but aver that it was owned by them, not as copartners, but tenants in common, each owning a moiety thereof. It is further shown that, on the twelfth day of June, 1871, Johnson leased to Kline his interest in the real estate and brewery property, at a stipulated rent, and that thereupon Kline went into the exclusive possession of the property, and that the copartnership was dissolved. It is alleged that no part of the rent reserved by this lease has been paid, and relief is sought against Klein in defendant's cross-bill based thereon, which was allowed by the court below in the decree. As defendant Kline does not appeal, nor do the other defendants, from the decree upon their cross-bill, but only from the decree in plaintiffs' favor, and thereby complain in the court only upon the ground that the judgment in their favor was not made a lien on the property paramount to plaintiffs' mortgage, the correctness of the decree against defendant Kline in favor of the other defendants need not be considered further than to determine whether plaintiffs' mortgage is prior thereto, which will hereafter be done. The defendants claim that the action is barred by the statute of limitations. Other allegations of the pleadings of the parties--and they are numerous, running through various original pleadings and amendments thereto--need not be recited, as, in the view we take of the case, the rights of the parties are to be determined upon the issues presented in the parts of the pleadings we have recited.
It will be observed that the controlling questions of fact and law in the case involve the existence of the partnership, its ownership of the mortgaged property, the dissolution of the firm, the settlement of its affairs by Kline, the continuance of its business by Kline as a surviving partner, and the validity and effect of the mortgage in suit executed by him. We will now proceed to the determination of these questions.
2. First. The evidence, in our opinion, quite satisfactorily shows the existence of the partnership, the ownership of the mortgaged property by the firm, and that the indebtedness to plaintiff was contracted for the purchase of the property and the prosecution of the partnership business. Upon these points it can hardly be said that there is conflict of proof.
Second. The evidence tends to show that prior to his death Johnson withdrew from the partnership, and the business was afterwards prosecuted by Kline alone. But if there was no dissolution of the partnership by agreement of the parties, it was surely dissolved by the death of Johnson.
Third. The affairs of the firm were left in the hands of Kline for settlement, and for the payment of its debts. We need not, in the view we take of the case, inquire into the existence of the lease of the interest of Johnson in the brewery property by Kline, and whether, as plaintiffs claim, it was canceled upon an agreement between Kline and the executrix of Johnson's estate. Conceding the continued existence of the lease, our conclusions will not be affected thereby.
Fourth. The evidence, we think, shows that Kline held the property of the firm for the payment of its debts and the settlement of its affairs. We think this was known by all the...
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