Wormer v. Waterloo Agricultural Works
| Decision Date | 14 December 1882 |
| Citation | 14 N.W. 331,62 Iowa 699 |
| Parties | WORMER & SON v. THE WATERLOO AGRICULTURAL WORKS ET AL |
| Court | Iowa Supreme Court |
Appeal from Black Hawk District Court.
ACTION to foreclose a mortgage executed by the defendant corporation. Robert Waller intervened, and seeks to have established a lien prior to that of the mortgage. The court found and entered judgment for the intervenor, and the plaintiff alone appeals.
REVERSED.
Boies & Couch, for appellant.
Graham & Cady, for intervenor.
As against the defendant, it was held in 50 Iowa 262, that the plaintiff was entitled to a foreclosure of the mortgage. Two days prior to the procedendo being filed in the district court, Robert Waller intervened in the action by filing a petition, in which he claimed that the plaintiffs' mortgage was junior to certain liens or interests he had in and to the mortgaged premises. The material facts upon which such claim is based are as follows The premises had been sold under executions issued on judgments establishing mechanics' liens thereon. These liens were prior to that of the mortgage, and one Bayless was the purchaser at the execution sale. The defendant's right of redemption expired in June, 1875. The right of creditors, including the plaintiffs, to redeem had expired prior to that time. Unless, therefore, redemption was made by or in the interest of the defendant, the premises would be conveyed by the sheriff to Bayless, and the interest of the plaintiffs under the mortgage, as well as that of defendant would be cut off, and Bayless would become the absolute owner of the premises.
A day or two prior to that on which the right to redeem expired one Ackley, president of the defendant, and acting for it, applied to one Cain, an agent of the defendant at Dubuque, for a loan to redeem the property from the sale to Bayless. Ackley represented, or caused Cain to understand, that Bayless would assign the certificate of purchase upon being paid the amount required to redeem. But it was regarded as doubtful, for want of time, if this could be accomplished, as Bayless was a non-resident. Redemption had to be made in Black Hawk county, and the conclusion at Dubuque was that Cain should go to Waterloo prepared to and to make redemption, if he saw proper. Ackley and Cain reached Waterloo about 7 o'clock in the evening, and redemption, if made at all, had to be made before midnight. Ackley made efforts to see the attorneys acting for Bayless, but failed to do so, and it was then certainly developed that the certificate of purchase would not be assigned to the intervenor, if he advanced the money required to redeem. Cain, therefore, determined to make statutory redemption in the name of the defendant, and did so upon Ackley's promise to give what security he could, and it was agreed that he should execute to the intervenor a mortgage on the same premises upon which plaintiffs' mortgage was a lien, and assign certain judgments which he held against the defendant. On cross-examination, the following questions were asked Cain: "Well, did you in effect or in substance agree with him, (Ackley,) before you made a deposit of the money, that you would advance the money and take a mortgage upon the property of the Agricultural Works, provided you failed to get an assignment of the certificate of the sale from Bayless?" He replied: "Well, that was about the understanding." He was further asked: "And that was before you made the deposit, was it?" He replied: "Yes, sir." The mortgage under which the plaintiff claims was executed in 1873, and duly filed for record and recorded. Besides this, Cain had express notice of the mortgage, but Ackley informed him that in his opinion it could not be enforced, except it was possible it could be to the extent of one of the notes secured thereby, and, as we understand, the plaintiffs are now seeking to foreclose for said note. Ackley, during the negotiation as to the security to be given the intervenor, said to Cain that, if the collection of the note was enforced by a foreclosure of the mortgage, it would lessen the intervenor's security "to that extent, but that the works would be ample security."
When Ackley came to execute the mortgage, it was ascertained that he did not have the authority to execute it but that the power to sell the premises had been conferred upon him as president of the corporation. Whereupon he executed for and in behalf of the defendant a conveyance of the mortgaged...
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