Opinion
January 19, 1926. Rehearing Denied April 9, 1926.
APPEAL AND ERROR: Decision in General — Avoidance of Technical 1 Remand. The claim on appeal that an equitable action for the foreclosure of a contract for the sale of real estate is premature, and that judgment was rendered for the entire amount prior to its full maturity, will be disregarded on the de novo review on appeal, when it then appears that the entire amount is due and unpaid, and that no plea in abatement of the action, or other objection because of prematurity, was made in the trial court.
VENDOR AND PURCHASER: Performance of Contract — Noneffectual
Novation.
VENDOR AND PURCHASER: Remedies of Vendor — Action to Enforce
Contract — Tender of Conveyance — Sufficiency.
VENDOR AND PURCHASER: Merchantable Title — Abstract — Waiver
of Timely Delivery.
MORTGAGES: Release — Change in Name of Mortgagee — Presumption.
VENDOR AND PURCHASER: Performance of Contract — Merchantable
Title — Belated Objections.
APPEAL AND ERROR: Review — Failure of Cross-Petitioners to
Appeal Between Each Other. among whom judgments have been rendered on assignments and assumption of the contract sought to be enforced, et seq.)
VENDOR AND PURCHASER: Construction of Contract — Nonmutuality.
Headnote 1: 39 Cyc. p. 1849. Headnote 2: 39 Cyc. p. 1870. Headnote 3: 39 Cyc. p. 1850. Headnote 4: 39 Cyc. p. 1527. Headnote 5: 27 Cyc. p. 1419. Headnote 6: 39 Cyc. p. 1525. Headnote 7: 4 C.J. p. 696. Headnote 8: 13 C.J. p. 339.
Appeal from Mahaska District Court. — D.W. HAMILTON, Judge.
SUIT by vendor against the vendee and his assignees, to compel performance and to foreclose contract for purchase of land, and for judgment for the purchase money, and cross-petitions by the vendee against his and later assignees, and by the several assignees against their respective assignees for judgment in favor of plaintiff in the cross-petition, against defendants in the cross-petition, for the amount of any judgment that may be rendered in favor of the plaintiff in the action against the plaintiff in the cross-petition. Decree for the plaintiff in the original suit, and for the plaintiffs in the various cross-petitions. The defendants appeal. — Affirmed.
C.C. Orvis and R.J. Woodard, for W.H. Broerman, appellant.
L.E. Corlett, for Lester Butler, appellant. Devitt Eichhorn, for Charles Victor and Charles Dillard, appellants.
Irving C. Johnson and McCoy McCoy, for John Kaldenberg, appellant.
W.H. Keating and Thomas J. Bray, for appellee.
Under date of May 23, 1919, the plaintiff Vanderwilt contracted to sell to defendant Broerman the premises described, for $28,400, payable $1,500 by note due March 1, 1920, and the balance, $26,900, March 1, 1925, with right to vendee to make earlier payment, the deferred payment to bear interest at 5 1/2 per cent, payable annually. Possession was to be given to vendee March 1, 1920, and deed to be delivered on or before March 1, 1925, or "when above payments are fully made."
"Merchantable abstract of title to said premises to be delivered by first party to second party showing merchantable title in first party on or before the first day of January, 1920, and second party shall have 10 days for examination of said abstract, said examination to be in writing and any defect not specifically set out shall be deemed waived and first party shall have a reasonable time to correct any such defect and the abstract shall be continued to show such correction or amendments."
The contract contained the ordinary forfeiture and time of essence clause, and provided that all covenants and agreements therein contained should extend to and be obligatory upon the heirs, executors, and assigns of the respective parties.
In the duplicate received by the vendee, Broerman, May 1, 1920, instead of January 1, 1920, was specified as the ultimate date for delivering abstract.
Vendee Broerman assigned the contract to defendant Butler, February 20, 1920. Butler assigned to defendant Victor, March 1, 1920, Victor to defendant Kaldenberg, March 15, 1921, Kaldenberg to defendant Dillard, March 22, 1921. Butler paid the $1,500, March 1, 1920; Victor paid the interest due March 1, 1921. Broerman personally never was in possession. But Victor took possession on March 1, 1920, and he and his assignees had possession of the land until it was leased for the year beginning March 1, 1923, pursuant to stipulation in this suit made for the benefit of all persons found entitled to receive the rents. This stipulation was made April 19, 1922. The plaintiff testifies that Victor tore up the hay land, broke the pasture, "and put all in corn, — been in corn ever since, for four years, and needs a change. There are good hedge posts there, very valuable posts, and Charles Victor cut them off and took them home to his home farm. He * * * hauled a lot of stuff home off of the eighty. The place has been ruined." This is not disputed. There is no evidence that the contract was ever rescinded or possession returned to the plaintiff, or that the status quo was or could be restored. At the trial, plaintiff amended, to conform to the proof, by pleading waiver. In answer to this amendment, Broerman alleged that, upon plaintiff's failure "to perform his part of the said contract, that this defendant rescinded his interest in the said contract with the plaintiff and all his interest in said contract, and the said defendant alleges that he assigned any interest, right, or title in the said premises at that time, and disclaims any interest in said premises on and after the first day of May, A.D. 1920."
Dillard answered the amendment, saying that he "tenders possession of said property to said plaintiff, and makes this offer to surrender possession and to permit the plaintiff to have the rents and profits that have accrued on said farm during the time that the same has been leased by the attorneys, respectively, for the plaintiff and the defendant."
Plaintiff testifies that his abstract of title was in the office of his attorney all the time, and that there was never any attempt to present it to any of the defendants; that he supposed the abstract was to be delivered when the land was paid for, and did not intend to deliver it before that time. None of the defendants ever asked him for the abstract. There was, on the date of the contract, a $20,000 mortgage against this land and other land, to the First Joint Stock Land Bank of Chicago. He says that Attorney Johnson, at whose office deed was to be delivered, drew the contract, and that, at the time, he (plaintiff) told them about the mortgage, and that just as soon as they paid the contract the mortgage would be released; that Broerman said that was all right. Broerman denies this conversation, or that he knew anything about the mortgage until after this suit was brought. The plaintiff, at the trial, produced a release of the mortgage, and tendered it into court, with the recording fee.
Plaintiff left his contract and the matter of looking after it with his attorney, Mr. Keating, who was also an abstracter. Mr. Keating says that he prepared the abstract for this piece of land and for another (Smith) piece that Broerman was purchasing, and told Broerman, in January, 1920, that he had both the abstracts ready; that Broerman said he doubted very much if he would ever be able to carry out the Vanderwilt contract; wanted to be sure about the Smith abstract, but "the other [Vanderwilt] abstract, it was a loan through the Joint Stock Bank, and he wasn't so particular whether that was examined right then." Keating says that he examined the title to the Smith land for Broerman and gave him a written opinion on it. This opinion is in evidence, and is dated February 1, 1920.
Broerman says that the arrangement by which he assigned the contract was made the fall before. Mr. Broerman evidently considered that he had no particular interest in the contract after he arranged, in the fall of 1919, to turn it over to Butler. His recollection is quite vague; and, while Mr. Keating did not have a clear recollection of all the details, we are satisfied that the facts are, in substance, as he testifies.
No demand was ever made by any of the defendants for an abstract, and no question was ever raised about the title until the introduction of evidence on the trial was in progress, further than that the plaintiff alleged, in general terms, ability to perform, to which defendants filed a general denial.
The petition was filed June 17, 1922. The defendants, except Dillard, filed separate answers in April and May, 1923, and on September 20, 1923, filed cross-petitions, each against his and subsequent assignees (not against the plaintiff), setting up their and later assignments, each claiming that his and subsequent assignees be decreed to perform all of the conditions of any decree rendered against the cross-petitioners. On November 27, 1923, Dillard answered, stating that he took possession of the property under defendant Kaldenberg, and continued to rent and occupy until March 1, 1923, when the lease under stipulation referred to was made. This is the answer that includes the paragraph previously set out. Each defendant appeared by separate attorneys. Their answers and cross-petitions were separate. The only appeal shown is that all of the defendants perfected their appeal by serving notice on plaintiff and the clerk. In this court Broerman files separate argument, adopting in part and disputing in part the joint argument filed by the other defendants.
I. It is contended that the suit is premature, because the first payment was made, and the deferred payment was not due until March 1, 1925. The contract provided for the payment of interest annually. We assume that the interest 1. APPEAL AND would begin March 1, 1920, rather than at the ERROR: date of the contract. When suit was brought, one decision in installment of interest was due and unpaid. general: Before it was tried, a second had become due, avoidance of and was unpaid. Before the case reached this technical court, a third one was due and unpaid; and remand. before it was submitted here, the entire amount was due. The plaintiff's petition claimed judgment for the entire amount of the contract, principal, and interest. The case was tried on its merits. No question of immaturity of any of the amount claimed was raised in the lower court.
Sections 4297 and 4293 of the Code of 1897 are as follows:
"Sec. 4297. In cases where the vendor of real estate has given a bond or other writing to convey the same on payment of the purchase money, and such money or any part thereof remains unpaid after the day fixed for payment, whether time is or is not of the essence of the contract, the vendor may file his petition asking the court to require the purchaser to perform his contract, or to foreclose and sell his interest in the property."
"Sec. 4293. If there are any other liens on the property sold, or other payments secured by the same mortgage, they shall be paid off in their order. And if the money secured by any such lien is not yet due, a rebate of interest, to be fixed by the court or judge thereof, must be made by the holder, or his lien on such property will be postponed to those of a junior date, and if there are none such, the balance shall be paid to the mortgagor."
The plaintiff had the right to foreclose, and to personal judgment for the interest installments due. Tupple v. Viers, 14 Iowa 515; Boynton v. Salinger, 147 Iowa 537. On foreclosure for the interest, the proceeds would be applied on the indebtedness due or to become due, as far as it would go. National Bank of Battle Creek v. Dean, 86 Iowa 656. The proper method of raising the objection of immaturity of cause of action is by plea in abatement. Harrison v. Hartford Fire Ins. Co., 102 Iowa 112; Bohanan v. Bohanan, 150 Iowa 182; The Telegraph v. Lee, 125 Iowa 17; Thompson v. Yousling, 196 Iowa 363. The cause is triable here de novo to the extent to which the appeal has been taken. We might remand the case, with permission to file supplemental pleadings and enter a new decree (Dierksen v. Pahl, 194 Iowa 713, 719), but no useful purpose would be served by this course. For these various reasons, we will not interfere at this time with the decree on the ground of immaturity of the principal and part of the interest of the debt at the time the decree was rendered. See Shult v. Doyle, 200 Iowa 1.
II. Broerman contends that plaintiff accepted Broerman's assignees as "paymaster," and therefore he is released. Broerman testifies that his assignees stated that, if he would take their interest in a horse which they owned jointly, 2. VENDOR AND they would take the farm, and assume his PURCHASER: obligation to plaintiff. He says he had no right performance to the farm after that. Plaintiff testifies of contract: merely: noneffectual novation.
"At the time Victor took possession of the farm, March 1, 1920, I knew he had an interest in the farm. He told me so, and I accepted him as paymaster. *** So far as I was concerned, I intended to hold the party, whoever paid me. * * * I didn't intend to hold anyone in particular, — whoever paid me."
Broerman has failed to show that he has been released.
III. Objection is made that the plaintiff did not offer to convey, before bringing the action. He was not required to do so. Huie v. Falde, 197 Iowa 289. As will be noted later, the suit is under the statute against the vendee in 3. VENDOR AND possession, to foreclose. If it were strictly a PURCHASER: suit for specific performance, still plaintiff remedies of offered in his petition to perform. The suit is vendor: in equity. A previous tender in such a case was action to not required. The court could so mold its decree enforce as to protect the interests of all. Boynton v. contract: Salinger, 147 Iowa 537. tender of conveyance: sufficiency.
IV. It is objected that abstract of title was not furnished within the time required by the contract, and that the one offered at the trial does not exhibit a marketable title. As has been stated, the vendee Broerman was offered the 4. VENDOR AND abstract of title before the time for delivering PURCHASER: possession arrived, but did not take it or have merchantable it examined. His assignee took possession of the title: land at the time stipulated. He and later abstract: assignees have had the full enjoyment of the waiver of premises, undisturbed and unquestioned, up to timely the time that it was leased under the delivery. stipulation for the benefit of all parties concerned. The vendee never claimed or attempted any rescission in pais. His statement in his answer filed during the trial, that he rescinded, is wholly unsupported. Dillard's mere tender of possession of the property, as the record stands here, amounts to nothing. All of the defendants were interested in the matter of rescission, and, as will appear, are precluded by the decree, as between themselves, from claiming a rescission. The vendee has made no offer to restore the status quo, and, on the undisputed evidence, cannot do so. No claim is made for equitable rescission, and, if made, it could not, on this record, be maintained. The defendants cannot, while in the undisputed possession and enjoyment of the fruits of the contract, and retaining its benefits, and not rescinding, successfully resist the vendor's suit for the purchase money (McNair v. Sockriter, 199 Iowa 1176; McCreary v. McGregor, 183 Iowa 732; Sharp v. Bremer, 192 Iowa 797); though they may, of course, insist on the performance of the vendor's subsisting agreements or covenants. Lillienthal v. Bierkamp, 133 Iowa 42. When the abstract of title was offered in evidence, the only objection made was that it showed the $20,000 mortgage, and that it was too late, and irrelevant, incompetent, and immaterial, and did not comply with the contract. The same objection was made to the offer of the release of the mortgage. It is now (as it was in the objections after 5. MORTGAGES: decree, to be noted,) claimed that the release release: was defective because made by the "Chicago Joint change in Stock Land Bank of Chicago, Illinois," instead name of of by the "First Joint Stock Land Bank of mortgagee: Chicago," which was the name of the mortgagee, presumption. as given in the mortgage. This objection is too late. Further, the release recites:
"The First Joint Stock Land Bank of Chicago on the first day of August, 1922, by amendment to its charter and with the approval of the Federal Farm Land Board of Washington, D.C., changed its corporate name to `Chicago Joint Stock Land Bank.'"
No reason appears for questioning this recital.
The decree stayed special execution for 30 days, and provided that, if the defendants paid the judgment during that time, the clerk should deliver the plaintiff's deed, and plaintiff should cause the release of the mortgage to be recorded 6. VENDOR AND and the abstract continued for the purpose of PURCHASER: showing such recording, and should deliver the performance abstract, so continued, to the clerk, for of contract: defendant. The release was recorded, and the merchantable abstract showing it was filed with the clerk title: within the 30 days. Defendants then filed with belated the clerk further objections to the abstract. By objections. these objections it is claimed that the release of the mortgage was defective, on account of the insufficient showing of identity of the mortgagee and releasor. No such objection was made before decree. It was too late, and is without merit. It was further objected that, on January 24, 1924, after the submission of the case, a judgment for debt and costs was entered against this plaintiff in another suit, which was a lien upon the land. This judgment is not a lien, as against the defendants to this action. Cumming v. First Nat. Bank, 199 Iowa 667. It is further objected that a former owner of the land in 1876 made a coal mining lease for the term of 10 years from its date, which was recorded March 2, 1904. There is no merit in this objection. It is further objected that one of the heirs of a former owner, who died in 1889, was named in the probate and partition proceedings "Homer Wharton," and conveyed as "Homer F. Wharton." The last of these proceedings was the decree of partition sale, March 17, 1890. The deed by Homer F. Wharton was recorded June 6, 1900. Objection is also made that a deed for one 40 dated June 2, 1899, is to George Prine, while the conveyance on December 24, 1912, is by George S. Prine. The name of the grantee of the other 40 by the same grantor was given as George S. Prine. No reason for questioning the identity is shown. It is a matter of general knowledge that the initial of the second Christian name is frequently omitted, and by the great weight of authority its omission, in the absence of special circumstances raising doubt about identity, is immaterial. Hendershott v. Thompson, 1 Morris 186; State v. Williams, 20 Iowa 98; Porter v. Butterfield, 116 Iowa 725; Keenan v. Briden, 45 R.I. 119 ( 119 A. 138); People v. Goscinsky, 52 Cal.App. 62 ( 198 P. 40); 29 Cyc. 266; Gordon v. Ransom Lomax Lbr. Co., 151 Ga. 181 (106 S.E. 176). See Chapter 272, Section 7, Acts of the Thirty-fifth General Assembly (Section 2963-k, Code Supplement, 1913). The objections were made too late. If they had been made promptly, they were without merit. Kurtz v. Gramenz, 198 Iowa 222. The plaintiff was tendering good title, in accordance with the contract, when the trial was had and the decree rendered, and, on the face of this case, was entitled to specific performance. Allen v. Adams, 162 Iowa 300. See, also, Durband v. Ney, 196 Iowa 574.
V. It is contended that the evidence does not support a personal judgment against the assignee defendants. The court gave judgment in favor of Broerman against each of the other defendants for the full sum, principal, 7. APPEAL AND interest, and costs, "or so much thereof as the ERROR: defendant William H. Broerman may be required to review: pay in satisfaction of the judgment herein failure of rendered in favor of the plaintiff." It also cross- gave the like judgments in favor of later petitioners assignees and against the subassignees from to appeal them. The record does not show the taking of any between each appeal by the cross-petitioners, as between each other. other. No notice of appeal by the other defendants has been served on Broerman. The rights of the parties under the decree on the cross-petitions cannot be disturbed on this appeal. Oskaloosa Sav. Bank v. Miller, 189 Iowa 393; Dillavou v. Dillavou, 142 Iowa 291; Brewer v. Stark, 198 Iowa 1238; Farmers Lbr. Co. v. Sheahan, 199 Iowa 1122. We think that the determination of the primary liability of the later assignees to Broerman finally settles also the plaintiff's derivative right to enforce it.
VI. Defendants argue that, because of the mortgage, there was a lack of mutuality. The plaintiff had title. He transmitted an equitable title and the possession to the defendants. The action is to enforce performance and to foreclose under 8. VENDOR AND the statute, and is not strictly an action for PURCHASER: specific performance. Stevenson v. Polk, 71 Iowa construction 278, 285. Without doubt, there was mutuality of of contract: obligation. There was also mutuality of remedy, nonmutuali- because the plaintiff was the owner of the land. ty. The remedy by specific performance has always been available to the defendant. 5 Pomeroy's Equity Jurisprudence (2d Ed.), Sections 2191, 2230; Kurtz v. Gramenz, 198 Iowa 222; Montgomery v. Gibbs, 40 Iowa 652; Olson Nessa v. Rogness, 173 Iowa 331, 341. The case is not one in which the vendor never had any title, and was a mere speculator, and for that or other reasons a suit against him for specific performance would have been unavailing. Luce v. Deitz, 46 Iowa 205; Webb v. Hancher, 127 Iowa 269, 276; Murray Bros. v. Keesey, 183 Iowa 739; Olson Nessa v. Rogness, 173 Iowa 331; Marti v. Ludeking, 193 Iowa 500; Braig v. Frye, 199 Iowa 184. Furthermore, plaintiff testifies that he told Broerman and the attorney that he would have the mortgage released as to the land when the purchase price was paid. He assigned his contract to Butler, who paid the $1,500. At least three other assignments of the contract have been made. The assignees took possession and enjoyed the use of the premises from March 1, 1920, to April 20, 1923. They committed at least some waste. They made only the first payment, $1,500, a little over 5 per cent of the purchase money, and one year's interest, at 5 1/2 per cent. They left the taxes for 1922 for the plaintiff to pay. Plaintiff testified, on cross-examination, that the buyers knew of the mortgage, "and Mr. Johnson knew it when he made the contract, because I told them about this * * * Mr. Butler also knows it. It was general knowledge." Mr. Keating says, as above stated, that Broerman spoke of the Joint Stock Land Bank loan. The unsupported denial of Mr. Broerman that "I never heard tell of that $20,000 mortgage" is not impressive. Defendants never asked for an abstract. The record does not show, otherwise than by inference from plaintiff's testimony referred to, when the mortgage could be paid. It was released as to land involved in this suit, May 16, 1923. It was dated January 15, 1918, and, under the law, might have been paid after five years. 9 U.S. Compiled Statutes 12117, Section 9835ff. The defendants were always owing more than enough to pay the mortgage, so that their rights could be amply protected by the court. On this record, it would not be in accordance with the principles of equity in administering its remedies to deny specific performance. Kurtz v. Gramenz, 198 Iowa 222.
The judgment is — Affirmed.
De GRAFF, C.J., and EVANS and ALBERT, JJ., concur.