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The will of Henry Jurgens, admitted to probate in 1922, provides:
First. Devises certain real estate thereafter sold by testator during his life and not here in question.
"Second: I give, devise and bequeath all the rest of the property of which I shall die seized to Fred W. Jurgens, as my executor in trust, for the purposes hereinafter stated and I hereby authorize and empower my said executor to sell, dispose of and convey said property at such times and at such prices and upon such terms as to him shall seem for the best interest of all parties concerned, and, out of the proceeds thereof, I direct that all my just debts and the expenses of my burial be paid and the residue thereof to be disposed of as follows:
"I will that said trustee take immediate charge of the property hereby bequeathed to him and that he rent the lands and invest the personal property in a suitable and safe manner and that, out of the proceeds thereof, he pay the necessary taxes and other expenses needed to keep the property in good condition. That he pay over to my wife, Adeline Jurgens, from time to time, as she may need, the rest of the annual proceeds from use of my said property or so much thereof as she may need for her use.
"Third: Upon the death of my said wife, I direct and empower my trustee to pay the expenses of her last sickness and burial out of my property. Upon the death of my said wife, I give, devise and bequeath all the rest and residue of the property of which I shall die seized of every kind and character *Page 492
as follows": One seventh each to six named children and one fourteenth each to two children of a deceased son "and the share of each to be delivered them by my said trustee, Fred W. Jurgens" (except the shares of the two grandchildren which were to be held in trust until they attained a certain age).
The trust for these grandchildren never took effect because the one surviving grandchild had reached the prescribed age prior to the death of testator's widow in 1946. Other provisions of the will are not here directly involved.
All of the real estate had been retained. In 1947 the executor-trustee made application for approval of a contract to sell part of it. Certain remaindermen objected. The trial court adjudged the contract of no force and beyond the authority of the trustee to execute or perform. The executor-trustee, who is also a remainderman, has appealed.
[1] The express provision relative to the sale of estate property is in paragraph Second: "and I hereby authorize and empower my said executor to sell * * * said property", etc. This language merely authorizes the executor to sell. It does not direct him to do so. Nor was there an absolute necessity to sell any real estate in order to execute the trust. Nor was there here any such blending of realty and personalty as to show an intention to create a fund out of both, and bequeath the same to the remaindermen as money. It is well settled that one or more of the foregoing elements must be present to work a conversion of real estate into personalty. Hanson v. Hanson, 149 Iowa 82, 127 N.W. 1032; In re Estate of Sanford, 188 Iowa 833, 839, 175 N.W. 506; In re Estate of Dodge, 207 Iowa 374, 381, 223 N.W. 106; Grady v. Grady, 221 Iowa 561, 564, 266 N.W. 285.
[2] However, appellant contends a provision in paragraph Second, that after payment of debts the residue "be disposed of", means that it be sold or parted with. He points to other places in the will where the term "dispose of" is used in that sense. The term has many shades of meaning. Here the context plainly indicates it was used in the sense of "be used or employed." With this substitution, the part of the paragraph in question would read: *Page 493
"* * * out of the proceeds thereof, I direct that all my just debts and the expenses of my burial be paid and the residue thereof to be employed [disposed of] as follows:
"I will that said trustee take immediate charge of the property hereby bequeathed to him and that he rent the lands and invest the personal property * * * pay over to my wife * * * the annual proceeds from use of my said property", etc.
The express direction to rent the lands and pay the annual proceeds to the widow is inconsistent with appellant's contention that testator directed or intended that the lands be converted into money for the purpose of executing the trust.
[3] Nor does the will authorize appellant to sell the land for the purpose of distribution. The primary purpose of the trust was the support of the widow. The will provides: "Upon the death of my said wife, I give, devise and bequeath all the rest and residue of the property of which I shall die seized" to the designated beneficiaries. The effect of this was to vest the legal title to the real estate in the designated beneficiaries, upon the death of the widow. Restatement of the Law, Trusts, section 345.
It may be assumed this was subject to the payment of the expenses of her last sickness and burial. However, these were paid out of other funds of the estate, leaving a small cash balance. The trust was then fully executed.
[4] The will contains no provision authorizing appellant to sell the real estate on the termination of the trust. His authority to sell had terminated before the attempted sale here in question. Watland v. Good, 189 Iowa 1174, 179 N.W. 613; Karolussen v. Christianson, 187 Iowa 744, 747, 174 N.W. 482; 54 Am. Jur., Trusts, section 70. See, also, Hausen v. Dahlquist,232 Iowa 100, 108, 5 N.W.2d 321, 141 A.L.R. 1304; Restatement of the Law, Trusts, section 69, Illustration 5.
Appellant points to language in the will directing him to distribute and deliver the shares of beneficiaries. He argues this indicates testator did not intend the devises of the fractional shares to be in kind. Under the circumstances, we are not inclined to attach much importance to the language in question. It may have been intended to refer to personal property *Page 494
which might be in the hands of appellant at the termination of the trust. In any event, it will not be permitted to change the effect of the plain language devising all the rest and residue of the property to the designated beneficiaries. — Affirmed.
All JUSTICES concur.
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I. Appellant argues that the appeal from the board of review 1. TAXATION: was not the proper remedy. This question is assessment: settled by Griswold Land Credit Co. v. County
error: of Calhoun, 198 Iowa 1240, and by First Nat.
exclusive Bank of Montezuma v. Board of Review, 199 Iowa procedure to 1124. correct.
II. The cause was submitted to the trial court upon a stipulation of facts. It appears therefrom that the capital stock of appellee on January 1, 1922, was $100,000, and that at said time it had a surplus of $50,000 and undivided 2. TAXATION: profits of $7,877.61. It appears that the assessment: deposits of said bank on that date were moneys and $840,338.87, of which deposits $433,309.68 were credits as time deposits, and that the remainder of its "moneyed deposits were commercial deposits by capital." individuals, firms, corporations, and banks. It also appears, that the amount of the capital stock of appellee actually invested in real estate on January 1, 1922, was $145,649.17. *Page 133
It appears that appellee conducts a general commercial banking business, such as is ordinarily and usually conducted by banks of a similar character in cities like Newton in the state of Iowa, and that in connection with its business it had loans secured by real estate, aggregating $90,545, which bore interest at different rates, and which loans were due at various dates, but which were originally made for terms of from three to five years.
It also appears from the agreed statement of facts that, on January 1, 1922, there were assessed by the taxing authorities of Jasper County, Iowa, moneys and credits in the hands of individual citizens of said county in the total sum of $11,719,840, of which said sum $3,190,083 was assessed against individual citizens residing in said city of Newton.
No specific evidence was offered as to the particular character of the moneys and credits so assessed, but it is stipulated that a large portion of said moneys and credits consisted of money loaned by individual citizens and individuals of Newton and vicinity upon promissory notes, some of which were secured by real estate mortgages, and some of which were unsecured; that a portion of said moneys and credits represented money invested in loans or in securities of a permanent or temporary character, which were held by the owners thereof with a view to sale or repayment and reinvestment. It is also admitted that all of the parties who were so assessed as the owners of moneys and credits maintained no offices for the purpose of loaning money, and were not engaged in a private banking business, and that they loaned their own money. There is neither stipulation nor proof that said moneys and credits came into competition with appellee.
It also appears that all of the moneys and credits assessed as such by the banking authorities were assessed at the uniform rate of 5 mills on the dollar, for the year 1922. It likewise appears that the capital stock of appellee bank was assessed at the sum of $2,446, which amount represented 20 per cent of the full amount of the capital, surplus, and undivided profits of said bank on January 1, 1922, after deducting therefrom the amount of said capital invested in real estate. The said assessment was made upon said valuation of $2,446 at 224.26 mills *Page 134
on the dollar. The trial court found that said assessment was erroneous, and that the shares of stock in appellee bank should be assessed by deducting from its capital, surplus, and undivided profits the amount invested in real estate, and that the remainder so obtained should be assessed at the rate of 5 mills on the dollar.
As previously stated, the record does not show the exact character of the particular moneys and credits which were so taxed to individual taxpayers within the taxing district. But it does appear from the record that the moneys and credits so taxed, in a general way, consisted of loans by private parties of their own funds to individuals, and the ownership of notes secured by mortgages on real estate, and other similar securities; and that none of the parties who were so taxed as being the owners of moneys and credits, were loaning any except their own funds: and it affirmatively appears that they were not engaged in the banking business, either as private bankers or otherwise, and maintained no offices for the conduct of any business involving said moneys and credits.
The questions presented by the appeal in this case are determined by the opinion in First Nat. Bank of Montezuma v.Board of Review, supra.
Under the facts in this case, there is a failure of proof that the items of property taxed as moneys and credits to various taxpayers within the taxing district were not properly so classified and taxed. In other words, there is no showing from the stipulated facts that the property taxed as moneys and credits was moneyed capital in competition with appellee bank. It was properly assessed as moneys and credits. It should not have been assessed as moneyed capital in competition with appellee.
It is unnecessary to repeat the discussion in the Montezuma
case. The facts of the instant case do not differentiate it from the Montezuma case.
In Jasper County Sav. Bank v. Board of Review (Iowa), 202 N.W. 387 (not officially reported), as in the case at bar, the cause was submitted on a stipulation of facts. It is true that the stipulation in each case uses the term "moneyed capital," but the recital is that the so-called "moneyed capital" was "in the form of money and credits in the hands of individual *Page 135
citizens of Jasper County." The recited facts, as distinguished from the legal conclusions of the stipulation in each of said cases, disclose that the property assessed as moneys and credits was properly so classified and assessed. There is nothing in the stipulation in either case, by legal conclusion or statement of fact, showing that the property assessed as moneys and credits came into competition with the business of appellee, within the meaning of Section 5219 of the Revised Statutes.
The judgment of the trial court in reducing the assessment of appellee was erroneous, and must be, and it is, — Reversed.
EVANS, STEVENS, ARTHUR, De GRAFF, and VERMILION, JJ., concur.
ALBERT, J., dissents.
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[1] The action was commenced in 1935 and has pursued its unhurried course to this hour. It comes to us *Page 34
now with no issue of fact involved on the appeal but only legal questions of procedure and exercise of judicial discretion.
The case, originally at law but by agreement transferred to equity, involved many mutual accounts and obligations. Their nature need not be described here except to say that a part of plaintiff's account is for goods sold and delivered. By consent the court referred the cause and instructed the referee, "upon conclusion of the hearing * * * that he report his findings and conclusions of law to the Court as provided by law."
The hearing was thereafter held and on August 30, 1939, defendant filed motion to dismiss because plaintiff "has failed and neglected to prove the reasonable value of the items set forth in Exhibit `A' attached to her Petition and as pleaded in her Petition." The abstract does not make clear whether this motion was filed with the referee or in the clerk's office; or, if the latter, whether it ever reached the referee. His report was filed the next day, August 31st, and made no reference to the motion. It set out the referee's conclusions of law and findings of fact and "rendered" judgment in favor of plaintiff.
Before any action by the court on the report or on the motion to dismiss, the plaintiff, on September 23, 1939, filed application for permission to give further testimony "as to the fair, and reasonable value of the goods, wares, and merchandise sold to Defendant," alleging "that said testimony was not given heretofore because of oversight which oversight is evident." With this application plaintiff also filed a "proffer of testimony" to prove by certain named witnesses that the prices shown in the various accounts were the fair and reasonable market value of the goods referred to.
The court overruled defendant's motion to dismiss, granted plaintiff's application for permission to offer further testimony, set aside "that part of Referee's report * * * purporting to render judgment," and remanded the case to the same referee with instructions to reopen the hearing, receive further testimony, and to amend his report accordingly. To this defendant excepted.
Before any further hearing was held before the referee the *Page 35
parties stipulated that the witnesses would testify as predicted and that the referee "shall consider the testimony together with this stipulation and file his amendment to his former report in accordance with the order of Court." The same day the referee filed his second report, stating that his original findings of fact and conclusions of law were unchanged and reaffirming the former report and "recommending" judgment accordingly.
Thereafter the defendant filed objections to the report urging that the matter had been referred "for determination and decision as provided by law," that the referee refused and neglected to rule on defendant's motion to dismiss, and that the referee's first and second reports should be set aside and the referee directed to rule on said motion to dismiss and to "proceed to the final determination of said hearing." The court overruled defendant's objections and directed that judgment be entered for plaintiff and it was entered accordingly. Defendant has appealed.
Appellant's principal complaint is over the referee's failure to rule on the first motion to dismiss and the action of the court in assuming to make that ruling and in reopening and remanding the case for further testimony. It is not clear whether he concedes that the referee could properly, in his discretion, have reopened the hearing and permitted appellee to make the proof that had been omitted by oversight; in other words, leaving out of account the question of who made the decision, it is not clear whether appellant claims there was error in the substance
of the decision itself. In order to bring about a final determination of this long controversy we shall decide both questions.
I. Was the action of the court, in passing on appellant's motion to dismiss and in reopening the case, without jurisdiction? Appellant argues that there had been a reference "for determination and decision" and the court had no authority, either by statute or under the common law, "to arbitrarily assume jurisdiction of any proceeding before the referee."
We attach no controlling significance to the quoted language of the order of reference. It did say: "for determination and decision as provided by law"; but it also said: "and upon conclusion of the hearing by Referee that he report his findings and conclusions of law to the Court as provided by law." *Page 36
The language of appointment could delegate to the referee no absolute judicial power, the exercise of which would be beyond the control and review of the court. The statute does not contemplate complete abdication and delegation by the presiding judge of all the judicial power of the court. The referee does not become the court but merely an officer of the court. 53 C.J. 740, section 146, citing, among other cases, Schohmer Leiser v. Lynch, 11 Iowa 461. See, also, Hobart v. Hobart, 45 Iowa 501. The statute provides:
"The referee shall stand in the place of the court, and shall have the same power, so far as necessary to discharge his duty."
(Italics ours.) Section 11524, Code of Iowa, 1939.
But it also provides (section 11526), "* * * the report may be excepted to and reviewed in like manner."
It cannot be doubted that a referee has power to pass on a motion to dismiss, filed after the evidence before him is closed and before he reports back to the court. Nor would he be without power to pass, in a proper case, on a similarly filed application to reopen the hearing to permit a party to supply proof inadvertently omitted. But in either case his action would not conclude the court. It would be subject to review just as any action of the referee is subject to review by the court under said section 11526, except (in law actions at least) findings of fact based on sufficient evidence. Wilgus v. Gettings, 21 Iowa 177; section 11527, Code of Iowa, 1939. The statute provides (section 11526) that the facts found and the conclusions of law "shall stand as the finding of the court, and judgment may be entered thereon." But until the court acts, the report of the referee is without effect.
The power of the court in acting on a referee's report is not appellate. Edwards v. Cottrell, 43 Iowa 194; Hodgin v. Toler,70 Iowa 21, 30 N.W. 1, 59 Am. Rep. 435. When and if the court approves the report and orders judgment thereon — then, and not till then — the decision is that of the court. The conclusions we have stated are in accord with the practice in Iowa, as they are, we believe, with the practice elsewhere. 53 C.J. 757, section 184; 45 Am. Jur. 573, section 43. In an early case *Page 37
we said, with reference to the status of a case that has been referred:
"The court does not lose its control of the parties, referees or the award. When the award is returned into court, a judgment may be rendered upon the same, or the court, upon a sufficient showing, may set it aside in whole or in part, or make a new reference." Schohmer Leiser v. Lynch, 11 Iowa 461, 463.
The statute then did not differ in substance from our present law. Revision of 1860, section 3095.
Under our decisions it is well settled that the court, upon a proper showing, has the right to set aside the referee's report and remand the matter for further evidence. Kossuth County State Bank v. Richardson, 141 Iowa 738, 743, 118 N.W. 906; Aldrich v. Rowell, Iowa, 166 N.W. 89; Poitevin v. Binnall, 148 Iowa 249, 125 N.W. 653. In fact, we have so held, where the case was asked to be reopened to enable a party to offer testimony omitted by inadvertence. Jewell v. Reddington, 57 Iowa 92, 10 N.W. 306.
In view of the consideration we have stated, we cannot see any error in the action of the court in assuming to act on appellant's motion to dismiss and appellee's application to reopen the case. If the referee had the right to act in the premises, whatever he did would have been subject to review. There could therefore be no error in direct action by the court. See, as bearing on this conclusion, Kossuth County State Bank v. Richardson, 141 Iowa 738, 118 N.W. 906, and authorities therein cited and reviewed.
[2] II. Was the decision, overruling appellant's motion to dismiss and reopening the case on appellee's application, erroneous? We think not.
The books are full of cases, some where the case has been reopened and some where the application has been denied. In all of them the question is held to be one of sound legal discretion. Sawin v. Union Bldg. Sav. Assn., 95 Iowa 477, 483, 64 N.W. 401; Hill v. City of Glenwood, 124 Iowa 479, 100 N.W. 522; Lee v. Farmers Mutual Hail Ins. Assn., 214 Iowa 932, 241 N.W. 403. *Page 38
Many more cases could be cited and many quotations made, all to the effect that on appeal the case will not be reversed, whichever way the trial court decides, except in case of plainabuse of discretion. The rule has been applied, by analogy, to cases of reference (Aldrich v. Rowell, supra) and to permit correction of an evident oversight. McCormick v. Holbrook,22 Iowa 487, 92 Am. Dec. 400.
It can hardly be claimed that there was any abuse of discretion here. The parties promptly stipulated the proposed testimony, and appellant, though also given permission to offer additional evidence, made no effort to refute it. The action of the court was to permit correction of a manifest oversight and ascertain the truth. It was in the interest of the due administration of justice and was not erroneous.
It is unnecessary to consider other matters argued in support of the trial court's decision. The case should be and is hereby affirmed. — Affirmed.
All JUSTICES concur.
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On December 18, 1930, plaintiff commenced an action on account against the defendant Wearmouth, in which an attachment was issued and the Jasper County Savings Bank was garnished. Judgment was entered against the defendant and the garnishee for $14.40. The garnishee only appeals. The lower court certified an appeal.
The garnishee claims that any money owing to the defendant was not due.
In its answer the garnishee admitted that the bank owed the defendant Wearmouth $14.40 on a special savings account started and maintained under rules of his employment with the Maytag Company under which none of the money deposited could be withdrawn before April, 1934, without permission from the Maytag Company; that the defendant was an employee of the Maytag Company which started a savings account for and in defendant's name, subject to instructions given the bank that none of the funds deposited could be withdrawn before April 10, 1934, without permission of the Maytag Company, which had never been given.
In reply plaintiff alleges that the amount deposited is now due the defendant on an ordinary savings account deposited for defendant in garnishee bank.
The facts were stipulated as follows:
It was stipulated that the amount on deposit in defendant's account as shown by his passbook was $14.40 on the date of the garnishment; that at the time of the first deposit the garnishee bank issued defendant a passbook; that the garnishee did not change its rules or regulations with reference to savings account by amending the printed matter in defendant's "pass book"; that no new rules or regulations with reference to savings account and passbooks were adopted by the bank's board of directors, nor posted in the bank. *Page 116
Subject to objections by the plaintiff that the same are incompetent, irrelevant, immaterial, violate the parol evidence rule, and are in contravention to the statutes of Iowa regulating savings banks, all the following facts were also stipulated:
That Exhibits B, C, and D are correct copies of bulletins posted on the bulletin boards in the office and shops of the Maytag Company on February 8, 1927, and March 4, 1927, respectively; that the garnishee bank was instructed by the Maytag Company not to pay any of said account prior to April 10, 1934, without its written permission, which was never given; that the money in said account belonged to defendant, who consented that it be withheld from his wages for deposit in accordance with the bulletins referred to.
It was also stipulated that the savings account book, Exhibit A, is similar to those issued to savings depositors generally, except for the words "Maytag Employee's Special" printed on the cover.
The Exhibits B, C, and D, offered subject to objection referred to, were general bulletins issued by the Maytag Company and posted in their office and shops notifying its employees of a certain plan adopted by it, to place a small per cent of the wages due their workmen in the garnishee bank, to provide a savings account for its employees, and that their money so deposited could not be withdrawn for five years.
The printed matter in defendant's passbook showing the terms of the deposit are substantially as follows:
"Jasper County Savings Bank. No. 12142. In account with Virgil Wearmouth. Who accepts this book and makes all deposits subject to the by-laws of the Bank as herein printed and made a part of this deposit contract. No writing in this book except by an authorized officer or Teller of the Bank. The following rules shall govern all savings deposits, to-wit: Depositors will be given a pass book in which all deposits made by him shall be entered, and he shall write his name upon a signature card of this bank. By becoming a savings depositor of the bank he assents to its rules, regulations and by-laws. The pass book shall be the voucher of the depositor, and the possession of the pass book shall be sufficient authority of the bank to warrant any payment entered therein. No money will be received from or paid to any depositor *Page 117
without presenting the pass book for entry of such deposit or withdrawal.
"The pass book must be left with the bank when the entire deposit is withdrawn.
"The bank's assent to the withdrawal of deposits, without notice, shall not be construed to be a waiver of its right to require written notice of any withdrawal as provided in section 1848 of the Code.
"These rules may be amended and new rules adopted at any regular meeting of the Board of Directors.
"Notice of changes in rules governing savings deposits will be posted in the office of the bank. For savings deposits not made in connection with a pass book, certificates will be issued bearing not more than four per cent, subject to the right of the bank to require notice, as provided in section 1848 of the Code of Iowa."
It is conceded that the bank's board of directors never amended its rules, never adopted new rules, and never posted notice of changes therein as required.
The plaintiff contends that under the rules and regulations of the bank, and under the laws applicable thereto, the money deposited belonged to the defendant Wearmouth at the time the garnishment proceedings were commenced, and that defendant was entitled to withdraw his deposit on demand, subject only to sixty days' notice if desired.
Plaintiff also contends that the garnishee bank could not change its liability to pay on demand, without the adoption of rules and regulations to the contrary by the bank's board of directors as provided in the rules contained in the defendant's passbook. Plaintiff contends that the rules, regulations, and by-laws therein set out constitute its contract of deposit with him which cannot be varied, altered, or changed by parol evidence; that to permit oral evidence changing the obligations of the bank to pay on demand without the authority of rules adopted by the board of directors would be contrary to law, and would vary, alter, and contradict the terms of the deposit contract, and be in violation of the parol evidence rule.
The lower court held that the deposit was due on demand.
The main controversy is whether or not the amount due the main defendant, Wearmouth, was payable on demand. If so, the judgment of the lower court must be affirmed. If the amount is not *Page 118
payable until April, 1934, then the judgment of the lower court must be modified.
If this was an ordinary savings deposit account, it would be payable on demand, as provided by statute as follows:
"9177. Payment. The deposits so received shall be paid to such depositor or his representative, when requested, with such interest and under such regulations as the board of directorsshall, from time to time, prescribe, not inconsistent with the provisions of this chapter." (Italics are ours.)
Code section 9178, provides as follows:
"Said regulations shall be printed and conspicuously exposed in the business office of the bank, in some place accessible and visible to all; and no alteration which may at any time be made in such rules and regulations shall affect the rights of depositors acquired previously thereto in respect to deposits or interest thereon."
The garnishee contends that, at the time the deposit was started, an oral agreement was made between the bank and the Maytag Company that the amount of the deposits would not be payable until the expiration of five years. This is conceded, but plaintiff claims that the admission of such evidence would violate the parol evidence rule because it would be an attempt to change, vary, and alter the terms of the contract of deposit set out in defendant's passbook, as to maturity of the account; that under the terms of the contract as so expressed the money was due on request.
It is conceded in this case that, subject to objection under the parol evidence rule, the contract for the deposit was made with the oral agreement and understanding that the money was not to be paid until the expiration of five years after its deposit. It is also conceded that there appeared upon the passbook in print the words "Maytag Employee's Special Savings Account".
[1] The sole question is whether or not the oral agreement providing for the payment of the deposit at the end of five years was admissible, notwithstanding the parol evidence rule.
It is the settled law that, "in the absence of a statutory prohibition to the contrary, a bank deposit may be subject to any agreement which the depositor and the banker may make with respect to it, so long as the rights of third parties are not injuriously affected." 7 C.J. 642, section 327. *Page 119
This rule has been approved by our supreme court in the case of Murray v. First Trust Savings Bank, 201 Iowa 1325, loc. cit. 1332, 207 N.W. 781; Lamb v. Morris (Harrison v. Harrison),118 Ind. 179, 20 N.E. 746, 4 L.R.A. 111; Shopert v. Indiana National Bank, 41 Ind. App. 474, 83 N.E. 515.
There is nothing in our statutes prohibiting an agreement by the bank making the deposit payable in the future.
There are two reasons why the parol evidence offered was admissible in this case:
(1) Because the entire contract was not contained in the passbook.
There is a well-known rule of law, as well settled as the parol evidence rule, to the effect that, where the entire agreement is not fully expressed in the writing, and where part of the agreement is oral and part in writing, parol evidence may be introduced to show the entire contract. The entire agreement between the depositor and the bank in this case was that the deposit would not be paid before the expiration of five years. The amount of the deposit was expressed in writing and evidenced by the passbook, that part of the agreement as to the time of payment was oral, and not included in the passbook. A contract may be partly in writing and partly in parol. If the parol part concerns a matter not covered by the writing, then, the written and parol parts being harmonious, the parol part may be shown along with the written.
"Where a written instrument executed pursuant to a verbal agreement does not express the entire agreement or understanding of the parties, the parol evidence rule does not apply to prevent the introduction of extrinsic oral evidence of the matters not provided for in the writing." 22 C.J. 1283.
1 Greenleaf on Ev. (15th Ed.) 284; 5 Wigmore on Ev. (2d Ed.) 2430; Mt. Vernon Stone Company v. Sheely, 114 Iowa 313,86 N.W. 301; Stoner v. Stehm, 200 Iowa 809, 202 N.W. 530; Sutton v. Griebel, 118 Iowa 78, 91 N.W. 825; Homer v. Maxwell, 171 Iowa 660,153 N.W. 331; In re Estate of Olson, 206 Iowa 706,219 N.W. 401; State v. Corning State Savings Bank, 136 Iowa 79,113 N.W. 500, 501.
In the case of State v. Corning State Savings Bank it was held that parol evidence was admissible to show that in fact the *Page 120
transaction resulting in the issuance of a bank certificate of deposit was a loan. In this case the court says:
"One of these incidental questions is this: May the receiver show that, although certificates of deposit were issued by the savings bank, the transaction was, in fact, a loan? Intervener contends that this may not be done, for the reason that the contract is in writing, and that parol evidence is inadmissible to show the nature of the transaction. There is no merit in this contention. The issuance of a certificate of deposit does not of and in itself indicate the true nature of the transaction. Such an instrument may be given, although a loan was intended, and parol evidence is admissible to show the true nature of the transaction. Estate of Law, 144 Pa. 499, 22 A. 831, 14 L.R.A. 103; Hotchkiss v. Mosher, 48 N.Y. 478; First [Nat.] Bank v. Myers, 83 Ill. 507. A certificate of deposit is for many purposes treated as a promissory note, and parol evidence to show that it was given as evidence of a loan is admissible."
The true nature and character of the transaction between the depositor and the bank in this case plainly shows that the deposit was intended as a time deposit and was not payable within five years after the date of the deposit. The passbook itself merely evidences the amount and date of the deposit made.
The passbook in this case contains no reference or agreement on the part of bank as to when the deposit was payable. In the absence of any contrary agreement, such a deposit would naturally be payable on demand under the statute. There is nothing, however, in our statute which prohibits an agreement as to the time of payment. Such an agreement, therefore, can be made by parol. We believe oral evidence is admissible showing the entire contract. Under this branch of the case, it is our holding that the oral evidence does not tend to change, vary, or alter the effect of the written agreement claimed to be expressed in the passbook.
[2] (2) If it be considered that the passbook contained the contract, it is also our belief that such a contract was ambiguous. This ambiguity is shown by the written words "Maytag Employee's Special Savings Account" printed in large type on the face of the passbook. One of the exceptions to the parol evidence rule is, where the writing is ambiguous, the ambiguity may be explained by parol.
[3] Under Code section 12172 execution under this judgment should be suspended until the maturity of this deposit. *Page 121
For the reasons herein above set out, it is the finding of this court that the defendant bank was indebted to the depositor, but that the debt was not due and payable until five years after the date of the deposit. The ruling of the lower court is therefore modified and reversed.
KINDIG, C.J., and ANDERSON, STEVENS, and ALBERT, JJ., concur.
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432205/
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This action was brought by Devere McCann, seeking to recover from defendant, Iowa Mutual Liability Insurance Company of Cedar Rapids, a judgment rendered in favor of plaintiff against H.R. Downey, in the district court of Boone county, on March 21, 1939, on a verdict of a jury for injuries sustained in an automobile accident. The damage suit was appealed to the supreme court by the insurance company, and affirmed. The company furnished and paid for the attorneys for the defendant Downey, and paid the costs of the appeal. This case was McCann v. Downey, 227 Iowa 1277,290 N.W. 690.
This action was brought under section 9024-g1, Code of 1935, which is as follows:
"All policies insuring the legal liability of the insured, issued in this state by any company, association or reciprocal exchange shall, notwithstanding any other provision of the statutes, contain a provision providing that, in event an execution on a judgment against the insured be returned unsatisfied in an action by a person who is injured or whose property is damaged, the judgment creditor shall have a right of action against the insurer to the same extent that such insured could have enforced his claim against such insurer had such insured paid such judgment."
The judgment against Downey, issuance of the policy, and the fact that it was in force in accordance with its terms at the time of the collision, were all admitted by the defendant company; but such company denied that the policy was in force as to the particular accident involved for the reason that at the time and place of the accident the insured automobile was being operated by Melvin Downey illegally as to age, thus excluding coverage, under an exclusion clause reading as follows: "(c) Under Coverages A, B, C and D, while the automobile is operated by any person under the age of 14 years, or by any person in violation of any state, federal or provincial law as to age *Page 512
applicable to such person, or to his occupation, or by any person in any prearranged race or competitive speed test."
By an amendment to its answer defendant set up the defense that by appearing and defending in the original case resulting in a verdict, and by appealing from the adverse judgment rendered against its insured, it did not waive and was not estopped from denying liability under the policy, for the reason that prior to such defense it had entered into certain reservation-of-rights agreements. These are certain agreements and a supplemental agreement providing in general that the defendant company would appear in any damage case against the insured, with the understanding that the insurance company should not be deemed to have waived its disclaimer of liability nor to have waived any of the provisions, conditions, limitations, or exclusions in the policy of insurance, and further, that it would provide counsel, with the same understanding, such defense to be afforded without prior judicial determination of the question whether said accident in suit was covered by the terms of the policy, the question of policy coverage being in no way abandoned by its appearing in said suit or defending the same. These agreements, and supplemental agreement which provided for appeal, followed prior notice to the Downeys.
The policy in question covered a Chevrolet sedan, having been transferred from a Studebaker previously owned by H.R. Downey, who lived one-half mile north of the northeast city limits of Boone, and who had a fifteen-year-old son named Melvin. Melvin was, early in 1938, issued a school permit to drive an automobile, on application of his father. On October 27, 1938, Melvin obtained permission of his father to use the car, speaking about going to choir practice and to a "pep" meeting at the high school. Nothing was said, nor did the father know, that Melvin was going to drive west of the high school. The distance from the Downey home to the school building was about two and one-half miles. The boy drove to the Methodist church and attended choir practice; thence to the home of a companion. They both then went to the high school and stayed five or six minutes, but did not go into the building. They later met some young friends and proceeded in a southwesterly *Page 513
direction on highway No. 30, across the Des Moines river, and the accident happened about two and three-quarter miles southwest of the high school, or a total distance from Melvin Downey's home of about five and one-quarter miles. The party in the Downey car followed another car occupied by other young people, this car being driven by one Phillips, and with no particular destination. All the occupants of the cars lived in Boone. The "pep" meeting was an informal gathering, attended by some but not all of the teachers. Students were not required to attend, nor were there any classes.
Following the collision a damage suit was brought by Devere McCann against H.R. Downey and others, resulting in a verdict in favor of the plaintiff. Appeal was then taken to the supreme court and the cause was affirmed on March 12, 1940. See McCann v. Downey [227 Iowa 1277, 290 N.W. 690], supra. The principal point of controversy in that case was as to whether or not the car was driven with the consent of the owner. The judgment against Downey is unpaid and execution was issued and returned unsatisfied. There is no dispute as to this fact and that throughout all the proceedings in the former case H.R. Downey carried a policy of insurance, and that the same law firms represented him in the trial of the original case as represent the defendant in this case, and that the insurance company furnished said lawyers and paid for their services.
The exclusion clause in the policy is heretofore set out. Coverage clause A, referred to therein, provides: "I. COVERAGE A — Bodily Injury Liability. To pay on behalf of the insured all sums which the insured shall become obligated to pay by reason of the liability imposed upon him by law for damages, including damages for care and loss of services, because of bodily injury, including death at any time resulting therefrom, sustained by any person or persons, caused by accident and arising out of the ownership, maintenance or use of the automobile." The policy also provides: "II. DEFENSE, SETTLEMENT, SUPPLEMENTARY PAYMENTS. It is further agreed that as respects insurance afforded by this policy under Coverages A and B the company shall (a) defend in his name and behalf any suit against the insured alleging such injury or destruction and *Page 514
seeking damages on account thereof, even if such suit is groundless, false or fraudulent; but the company shall have the right to make such investigation, negotiation and settlement of any claim or suit as may be deemed expedient by the company; * * *."
[1] I. Plaintiff's first assignment is that the court erred in sustaining the defendant's motion for a directed verdict, which motion was based on the theory that, under the exclusion clause heretofore set out, the operator, Melvin Downey, was violating the law applicable to the age of such driver. Plaintiff urges that if the driver was guilty of any violation of his limited permit it was as to use and not as to age, and that the court should have sustained plaintiff's motion for the same reason, and that the violation, if any, was as to restrictions, and was not a violation of the law as to age.
Section 205, chapter 134, Acts of the Forty-seventh General Assembly (now section 5013.01, Code of 1939) provides: "No person, except those hereinafter expressly exempted shall drive any motor vehicle upon a highway in this state unless such person has a valid license as an operator or chauffeur * * *. No person shall operate a motor vehicle as a chauffeur unless he holds a valid chauffeur's license." Section 208, chapter 134, Acts of the Forty-seventh General Assembly (now section 5013.04, Code of 1939) is as follows: "The department shall not issue any license hereunder: 1. To any person, as an operator, who is under the age of sixteen years, except that the department may issue a restricted license as provided in section 225 [section 5013.19, Code of 1939] to any person who is at least fourteen years of age; * * *." Section 224, chapter 134, Acts of the Forty-seventh General Assembly (now section 5013.18, Code of 1939) provides for authority for the department issuing the license to impose restrictions suitable to the licensee's driving ability, with respect to the type of vehicle and as to other matters "including licenses issued under section 5013.19, as the department may determine to be appropriate to assure the safe operation of a motor vehicle by the licensee. * * *." Section 225, chapter 134, Acts of the Forty-seventh General Assembly (now section 5013.19, Code of 1939) is as *Page 515
follows: "Upon a written request of a parent or guardian, a restricted license may be issued to any person between the ages of fourteen and sixteen years, to be valid only in going to and from school."
We have set out the applicable provisions of the Code, the first of which forbids driving by a person without a valid license; the second forbids the issuance of a license to a person under the age of sixteen years except as provided in Code section 5013.19. This last provision, in relation to minors, permits the issuing of a license to a minor only under certain conditions, and the license is valid under no other conditions — that is, it is not valid except in going to and from school. In other words, Melvin, not having attained the age of sixteen years, and not at the time of the accident being either going to or coming from school, was not a licensed operator, because he was not of an age at the time which would permit him to drive a car under any other conditions than in going to school and back to his home.
These statutory provisions were enacted for the safety of the public. As expressed by Justice Bliss, in Twogood v. American Farmers Ins. Assn., 229 Iowa 1133, 1143, 296 N.W. 239, 244, "* * * he made a practice of permitting this unlicensed, unauthorized minor (Code section 5013.01) to drive his car upon the highways, contrary to the statutes, and contrary to the rules of fair treatment to the travelling public. He was guilty of a misdemeanor if he knowingly did so (Code sections 5015.05 and 5036.01). By his conduct he exposed himself to the damage which he asks the appellant to pay."
It being recognized that driving by young children increases the hazards of the road, most policies of this nature now have the exclusion clause heretofore quoted, or one similar thereto. Under the undisputed facts in the case, the driving by Melvin in a totally different direction from any route which he might take from the school to his home would not be in compliance with the plain terms of the restricted license which he held, whether his father had knowledge thereof or not, and would not be in contravention of the facts in McCann v. Downey [227 Iowa 1277,290 N.W. 690], supra. We cannot agree with the plaintiff that Melvin's use of the automobile at the time *Page 516
and place in question, he being several miles from home and from the high school and in a different direction, was not a violation of the provision as to age but merely as to use, since the only permission granted by the license which he, being under the age when operators are entitled to drive, held, was to drive in a restricted place; that is, being under age, he had no license or authority to drive at the place where he was driving. That, as decided in the McCann case, supra, the father may have given him permission, does not authorize us to say that he was within the terms of his restricted license; therefore, as to age, he was driving without authority of law.
Since we hold that Melvin was at the time in violation of the law of Iowa as to age, there was, under the exclusion clause of the contract of insurance, no coverage under the policy. By the terms thereof the insured is excluded from the benefits of the policy when the automobile is operated "by any person in violation of any state, federal or provincial law as to age * * *." The holding in many states is that a violation of a restricted license in this respect prevents recovery thereon.
The form above given is a standard form of policy, and has been passed upon by several courts. It is true that there are decisions to the contrary, but we believe that the greater weight of authority is as we hold. As stated in Brown v. Travelers Ins. Co., 31 Cal. App. 2d 122, 87 P.2d 377, there is a conflict of authority, but this clause is in the policy in controversy, and the case holds that the operator was driving the car in violation of the law as to age.
Many cases are cited, both by plaintiff and defendant, and it would be impossible within the limits of an opinion to attempt to review or analyze the various cases. The statutes of the several states also differ, but we are satisfied that the better, and probably the more nearly general, rule is announced by those cases holding that, under circumstances such as in this case, there is no coverage under the policy.
As to the effect of the first damage case, we will refer to that hereafter.
Under the rule which we hold to be the better one, there is cited by the defendant the case of Witzko v. Koenig, *Page 517 224 Wis. 674, 678, 272 N.W. 864, 866, which dealt with a policy identical to the policy in suit. The court held there was no coverage, saying: "The contract of insurance provides that the respondent is not liable under its contract where the car is driven by a person in violation of law as to age. Under section 85.08 (1a), the permittee is not allowed to drive in the nighttime. Because of his age, under no circumstances could he secure a permit to drive in the nighttime. We must hold that at the time of the collision in question his driving was a clear violation of section 85.08 (1a), Stats., within the exclusion clause of the insurance policy." The opinion cites Hudak v. Union Indemnity Co., 108 Conn. 598, 143 A. 885; Weiss v. Preferred Acc. Ins. Co., 149 Misc. 911, 268 N.Y.S. 275; and other cases. See also, Shedd v. Automobile Ins. Co., 208 Ind. 621, 196 N.E. 227.
One of the most recent cases is Gulizia v. Royal Indemnity Co.,139 Neb. 832, 837, 299 N.W. 220, 222, where the policy provides, as it does here, that it did not cover any liability as to injuries caused while the car was being operated by any person in violation of the law as to age. The court says: "Where, as here, the express provisions of the policy clearly provide that the policy does not cover any liability as respects injuries while the car is being operated by any person in violation of law as to age, such provision, not being contrary to public policy or against any provisions of our statute, will be enforced as made, and the insured's car being driven by his son, fifteen years of age, for purposes other than attending school, and by leaving the route to and from his home and school by the nearest street or highway, was being driven in violation of our statute as to age, and such policy, during the time that the insured's car was being so driven, was suspended and no liability could attach to the insurer."
We have not undertaken to set out all the authorities bearing upon this question for the reasons heretofore given, but the foregoing cases, with others, clearly hold that the violation of law, under circumstances such as are found in this case, is a violation of the exclusion clause as to age and comes within the clause in the policy and prevents coverage by the policy *Page 518
while the car is so used. Courts have gone so far, under clauses similar to this one, as to hold that such a violation of law as to age may be a proximate cause, which determination, however, is not adopted by other jurisdictions and is expressly repudiated in various other cases. Plaintiff does not contend that such would be the effect of the provision, but we mention this fact to show that there has been a diversity of opinion.
[2] As a part of plaintiff's argument as to this division, he urges that an insurance policy must be construed most favorably to the insured, and, where a policy is susceptible to two constructions, that construction should be placed upon the policy which is most favorable to the insured. This argument, as an abstract proposition, is not to be contradicted, but we do not think it will apply in this case. It does not apply when the meaning is clear and the intention of the parties to the contract plain. In the Gulizia case, supra, this statement is made at page 836 of 139 Neb., page 222 of 299 N.W.: "Where the provisions of an insurance contract are not uncertain or ambiguous, but are clear and certain as to their meaning, and such provisions are not contrary to public policy or contrary to the provisions of our statutes, such policy will be enforced as made." See also Twogood v. American Farmers Ins. Assn. [229 Iowa 1133,296 N.W. 239], supra, where it is said that the/rule applies only when there is a real ambiguity in the language of the policy; citing Field v. Southern Surety Co., 211 Iowa 1239, 1243, 235 N.W. 571,572. See also U.S. Fidelity Guaranty Co. v. Guenther,281 U.S. 34, 50 S. Ct. 165, 74 L. Ed. 683, 72 A.L.R. 1064; Holland Supply Corp. v. State Farm Mut. Ins. Co., 166 Va. 331, 186 S.E. 56. And this is the general rule. Plaintiff cites in support of his position, Taylor v. United States Casualty Co., 269 N.Y. 360,199 N.E. 620, 115 A.L.R. 822; Brock v. Travelers Ins. Co.,88 Conn. 308, 91 A. 279. Also Des Moines Rug Cleaning Co. v. Automobile Underwriters, 215 Iowa 246, 245 N.W. 215, which case, however, was decided on a finding that the driver was not a chauffeur and therefore required no license. Glade v. General Mut. Ins. Assn.,216 Iowa 622, 246 N.W. 794, was decided on the question of failure to cooperate with the insurer. Venz v. State Auto. Ins. Assn., 217 Iowa 662, 251 N.W. 27, involved *Page 519
the question of waiver with knowledge. Other cases from other jurisdictions hold as claimed, but in the large majority of the cases on the construction of this exclusion clause the general rule is as we hold. Nor do we think that the rule of ejusdem generis can apply, since, as stated, the car was being driven in violation of the exclusion clause as to age and not merely as to use.
[3] II. The second assignment of error is that the trial court erred in overruling certain paragraphs of plaintiff's motion for a directed verdict, because, as plaintiff claims, the law of the case was definitely established in the original case of McCann v. Downey, supra, in that the district court jury and this court on appeal held that the minor son, Melvin Downey, was operating the car for school purposes on the night of the collision and the matter is res adjudicata; and for the further reason that the trial court erred in permitting the defendant to offer evidence on that point.
The main question in the trial of that case was as to whether or not the boy had permission from his father to use the car in the manner in which he did. The question in that case was as to whether or not the district court erred in not sustaining the motion to direct a verdict, the first ground of which motion was that the plaintiff had failed to sustain the burden of proving that the car was driven with the consent of the owner, and the second ground of the motion was that the evidence affirmatively showed that the car was driven in violation of the owner's orders. The holding of the court was that it was a question for the jury to decide. As between the insurance company and H.R. Downey, the question of coverage did not arise, and it could not have been decided in any event in that case. By securing judgment against Downey the plaintiff acquired only the rights which Downey himself had, since the injured person acquires no higher rights than the insured. Ambrose v. Indemnity Ins. Co.,124 N.J.L. 438, 12 A.2d 693.
In the former case the defendant company was not a party to the suit, nor could it have been made one. Nor were the issues the same. We held in Ellis v. Bruce, 215 Iowa 308, 245 N.W. 320, that an action cannot be brought against the assured *Page 520
and the insurance company, one being on contract and the other in tort. To the same effect, we have later, in Schulte v. Great Lakes Forwarding Corp., 228 Iowa 1012, 291 N.W. 158, determined the same question, and have held as in the Ellis case. See also Kellogg v. Bell, 222 Iowa 510, 268 N.W. 534; and see 85 A.L.R. 44, note. As is said in Daniel v. State Farm Mut. Ins. Co.,233 Mo. App. 1081, 1089, 130 S.W.2d 244, 248: "It is incumbent on one asserting the plea of res judicata that he establish, by affirmative proof, that the cause of action involved in the former case, and the parties, are identical with those in the case in which the plea is asserted. The chief issue in this case could not have been an issue in the former case. There is no such identity, either of cause of action or of parties, shown here." Plaintiff cites our holding in In re Estate of Lyman, 227 Iowa 1191,1195, 290 N.W. 537, 539, where we state as the governing rule (quoting from Linton v. Omaha Wholesale Produce Market House Co., 8 Cir., 218 F. 331, 334): "If the second action is upon the same claim or demand as was the first, and is between the same parties or their privies, the judgment in the first action, if rendered on the merits, constitutes an absolute bar to the prosecution of the second action." It is manifest that this rule does not apply here, since we hold that the question here involved was not, and could not have been, at issue in the former case.
The question of identity of attorneys, or the fact that the insurance company, under its contract, assumed the defense, would not be material on the question of prior adjudication; and Hoskins v. Hotel Randolph Co., 203 Iowa 1152, 211 N.W. 423, 65 A.L.R. 1125, cited by plaintiff, would not apply. Plaintiff also cites Reimer v. Musel, 220 Iowa 1095, 264 N.W. 47, where the holding on the first appeal, of insufficiency of evidence to present a jury question, becomes the law of the case and necessarily controls a retrial on the same evidence. As between the plaintiff and Downey this might be true, but as between the plaintiff and the company, which undertook the defense under the reservation hereinafter referred to, it could not apply. The first case was a question of negligence; the present is a question of coverage by the policy. *Page 521
[4] III. Plaintiff asserts that the defendant insurance company, by intermeddling in the case of McCann v. Downey [227 Iowa 1277, 290 N.W. 690], supra, and assuming the management and control of the trial and furnishing counsel, has waived and is now estopped from denying liability under its policy, and that the court erred in refusing to sustain that part of plaintiff's motion for a directed verdict which was to the effect that, by the actions of the defendants' attorneys in the McCann case, the defendant herein has waived and is now estopped from setting up a policy defense.
There is no question that the insurance company did, in the former trial, furnish counsel and pay expenses of the litigation. This it was permitted to do, under its agreement. To protect itself, the company gave notice to Downey and his son, and entered into a nonwaiver agreement. Where this is done, it is the general rule that no waiver or estoppel exists. Mann v. Employers' Liab. Assur. Corp., 123 Minn. 305, 143 N.W. 794; Mason-Henry Press v. Aetna Life Ins. Co., 211 N.Y. 489,105 N.E. 826; Humphrey v. Polski, 161 Minn. 61, 200 N.W. 812. See also, Sargent Mfg. Co. v. Travelers' Ins. Co., 165 Mich. 87,130 N.W. 211, 34 L.R.A., N.S., 491; Royle Mining Co. v. Fidelity
Casualty Co., 161 Mo. App. 185, 142 S.W. 438; Wigington v. Ocean Acc. Guar. Corp., 120 Neb. 162, 231 N.W. 770. In all the above cases the courts have held that where a company protects itself by notice and by stipulation, as in the present case, no waiver or estoppel exists. There being no waiver under the stipulation as to Downey, plaintiff, as hereinbefore stated, could recover no more than Downey could. Nor was it necessary that the plaintiff in the former suit be a party to the nonwaiver agreement. He had no rights under the policy until the judgment was entered against Downey, nor until the judgment against Downey was returned unsatisfied, under the provisions of section 9024.1 of the 1939 Code, heretofore referred to. The statute itself sets out that in the event an execution on a judgment against the insured be returned unsatisfied, in an action by a person who is injured or whose property is damaged, the judgment creditor shall have a right of action against the insurer to the same extent that such insured could *Page 522
have enforced his claim against such insurer had such insured paid such judgment. Since, as we hold there could be no recovery by Downey under the terms of the policy, there could be none here and, Downey having agreed that there should be no waiver or estoppel, there could be none in favor of the plaintiff herein. Plaintiff had no rights or claims as against the insurance company other than those which he held under Downey, and, there being no waiver as to him, there could be none as to the plaintiff and he would not be a necessary party to the agreement or entitled to any notice thereof.
Plaintiff cites many cases in support of his argument that an insurance company which appears and defends on behalf of its insured waives and is estopped from denying liability under the policy. Space will not permit us to refer to all the cases cited, but we call attention to some of them. Kidd v. Minnesota Atlantic Transit Co., 261 Mich. 31, 245 N.W. 561, and Ziegler v. Ryan,66 S.D. 491, 285 N.W. 875, do not support plaintiff's contention. In the latter case there was no disclaimer of liability. In Peterson v. Maloney, 181 Minn. 437, 232 N.W. 790, there was no notice of nonliability.
Plaintiff cites, among other cases, Hoskins v. Hotel Randolph Co. [203 Iowa 1152, 211 N.W. 423], supra. We do not think that the ruling in that case is applicable here. An examination of the facts in that case shows the distinction. The elevator company was secondarily liable. It was vouched into the case and notified by the hotel company that it would claim indemnity for any sums which it might be compelled to pay to the plaintiff. The elevator company attempted to disclaim any liability, but this was refused by the hotel company, and the final reply of the elevator company was [203 Iowa 1152, 1156, 211 N.W. 423, 426]: "`The record may show that we assume the defense under the law as to any liability that the law imposes, and no more.'" The opinion states at page 1160 of 203 Iowa, page 427 of 211 N.W.: "By the Otis Elevator Company's procurement, the Hotel Randolph Company was prevented from being heard through its own counsel upon a question that was vital to the Hotel Randolph Company's liability to plaintiff and its right to indemnity from the Otis Elevator Company." *Page 523
Again the opinion states at page 1160 of 203 Iowa, page 427 of 211 N.W.: "By the notice to defend, the Otis Elevator Company was confronted with the possibility of serious consequences to itself. All questions litigated would have been res adjudicata between it and the Hotel Randolph Company, even though it had not undertaken the defense." This, we think, constitutes the principal difference between the facts of this case and the facts as they existed in the Hoskins case. No one could claim that the insurance company in this case is a joint tort-feasor, and, as we have heretofore stated, it could not have been a party to the original suit So in the Lyman case [227 Iowa 1191, 290 N.W. 537], supra, cited by plaintiff, in both the equity and the probate actions, the claims were exactly the same, and the same person being superintendent of banking and receiver respectively in the two cases, and being so made receiver by law, the parties were the same in fact and the actions were identical. Plaintiff cites also Glade v. General Mut. Ins. Assn. [216 Iowa 622,246 N.W. 794], supra. In that case the claim was made by the insurance company that the insured had refused to co-operate in protecting the rights of the insurer, but the court held that the insurance company was not prejudiced thereby. This was an action between the insured, who had been compelled to pay a judgment for damages against him, and the insuring company, and the issue was the failure of the insured to co-operate in the defense. We do not think this is in any way in line with the case here. There was no waiver pleaded, nor do we find that the defendant was obligated to conduct or pay for the defense as in the case at bar.
Plaintiff further cites in this connection, Des Moines Rug Cleaning Co. v. Automobile Underwriters [215 Iowa 246,245 N.W. 215], supra. We have heretofore referred to this case. It was decided on the determination by the court that the employee was not a chauffeur. Peterson v. Maloney [181 Minn. 437,232 N.W. 790], supra, is also cited. This is a case wherein the insurance company voluntarily assumed the defense, with no obligation or agreement so to do. This case has heretofore been referred to. There was not only no notice in this case, but there was no obligation for the company to appear in the damage case and defend. *Page 524
We have not undertaken to review all the cases cited by the plaintiff, but have read the same and do not find anything therein which would tend to cause our conclusion to be other than it is, that, by appearing and assuming the expenses of the trial, after due notice of nonliability, there was no waiver or estoppel on the part of the company.
The rule in one case cited by the plaintiff — Bowen v. Cote, 1 Cir., N.H., 69 F.2d 136 — and which he urges should be adopted, we do not feel to be the true one. The general rule, and, it seems to us, the correct one, is as we have stated.
[5] IV. Plaintiff's last assignment of error is that it was the duty of the trial court to submit to the jury the fact question whether the minor son was operating the automobile in going to or coming from school. As heretofore stated, both parties, at the conclusion of all the evidence, submitted motions for directed verdict. That of the defendant was sustained. As we read the record, the evidence was not contradicted and there was nothing to submit to the jury. It seems also to have been recognized by the plaintiff that the questions involved were purely legal ones. We think there were no fact questions such as would require the submission of the case, and that there was no error here. It was undisputed, as pointed out in the first division hereof, that Melvin Downey was driving in violation of the law as to age applicable to him, and the insured was therefore not within the coverage of the policy.
We have examined each of the assignments of error, with the arguments, and the authorities cited therein. It is our conclusion that the ruling of the district court in sustaining defendant's motion for a directed verdict was right, and the cause should be, and is, affirmed. — Affirmed.
BLISS, C.J., and STIGER, SAGER, MILLER, and WENNERSTRUM, JJ., concur.
GARFIELD, J., takes no part. *Page 525
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432206/
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Plaintiff, T.J. Shoemaker, as administrator of the estate of J.H. Augustine, commenced this action to foreclose two real estate mortgages executed by the defendants, 1. BILLS AND N.A. and Gertrude Ragland, husband and wife, to NOTES: J.D. Plumb, and assigned to Augustine. The assignment: chronology of the case material to the payment propositions involved on this appeal is as without follows: production of note.
On the 22d day of March, 1917, the defendant N.A. Ragland became seized in fee simple, by deed of bargain and sale, executed by one Grover C. Duncan, of a certain parcel of real estate described as Lot 166 in Melrose Park, an addition to the original town of Marshall, Marshall County, Iowa.
On March 19, 1918, defendant N.A. Ragland and his wife, Gertrude, executed to J.D. Plumb two mortgages in the sum of $1,000 and $500, respectively, on said real estate, and on the same date executed and delivered to the said Plumb their two joint and several negotiable promissory notes, as evidence of the loan secured by said mortgages. The $1,000 note was payable March 19, 1921, with interest at 7 per cent. The $500 note was payable March 19, 1920, with interest at 7 per cent. *Page 949
On the 29th day of March, 1918, the mortgagee Plumb transferred, by indorsement in blank, the $1,000 note, and assigned in writing to J.H. Augustine the mortgage securing said note. On the 18th day of May, 1918, the said Plumb transferred by indorsement in blank, the $500 note, and executed an unsigned assignment to J.H. Augustine of the mortgage securing said note. Both assignments were acknowledged by J.D. Plumb before a notary public in and for Marshall County, but neither assignment was placed on record in the office of the county recorder, nor was either assignment entered or noted upon the record of the mortgage. Each of said notes has indorsed thereon the following:
"For value received I hereby guarantee payment of the within note and waive demand and notice of protest on same when due. [Signed] J.D. Plumb."
On December 24, 1921, J.H. Augustine died. In January, 1922, after the appointment and qualification of the plaintiff as administrator of the estate of J.H. Augustine, the notes, mortgages, and assignments were found by the administrator among the personal effects of the decedent; and on October 13, 1923, the administrator commenced the instant action. Plumb died subsequently to the death of Augustine, and prior to the commencement of this action by the administrator.
The defendants, in answer to the petition of plaintiff, admitted the execution of the notes and mortgages in question, but denied, on information and belief, that the said mortgages and notes were assigned by J.D. Plumb to J.H. Augustine, and further pleaded that, if said mortgages were in fact assigned, said J.H. Augustine fraudulently refrained from causing said assignments to be recorded, and acted in collusion with the said J.D. Plumb for the purpose of avoiding taxation and for the purpose of prejudicing the rights of these defendants; and that the defendants have voluntarily and in good faith caused the said notes and mortgages to be paid; that J.D. Plumb was the agent of J.H. Augustine for the purpose of collecting and receiving payments from these defendants; and that, having so constituted and appointed said Plumb as his agent, the plaintiff is estopped from claiming or asserting that payments made by the defendants to J.D. Plumb, as the agent of the said J.H. *Page 950
Augustine, were not, in fact, payments made to J.D. Plumb as the agent of the said J.H. Augustine.
There are two primary defenses to this action, which in interrogative form are: (1) Does it avail the defendant to contend that the assignments of the mortgages are within the purview of Section 10105, Code of 1924? (2) Does the evidence establish the plea of estoppel, based on the agency of Plumb, thereby making payments by mortgagor to Plumb payments to Augustine?
I. It must be conceded that the transfer of a note secured by mortgage carries the mortgage with it. State v. Gibson, 199 Iowa 377; Robertson v. U.S. Live Stock Co., 164 Iowa 230. We are not concerned in this case with the bona fides of the plaintiff as a holder in due course. No such issue is involved. The plaintiff was in possession of a duly indorsed note, and the profert of the same upon the trial established a prima-facie case. Bigelow v.Burnham, 90 Iowa 300; Farmers Traders St. Bank v. First Nat.Bank, 201 Iowa 73.
The first question to determine is whether the defendants are entitled to the protection of Section 10105, Code of 1924, which provides that no instrument affecting real estate shall be of any validity against a subsequent purchaser for value, without notice, unless filed in the office of the recorder of the county in which the real estate is situated.
It is true that we have no statute which, in express terms, requires the recording of assignments of mortgages either of real or personal property, but it has very frequently been held that, as to the former, an unrecorded assignment will be void, in favor of subsequent purchasers and existing creditors without notice.Central Tr. Co. of Illinois v. Stepanek, 138 Iowa 131, with cases cited. This principle, however, finds application only when a subsequent purchaser for value, without notice, is the party invoking the rule. It is urged, however, by the appellee in the case at bar that, in the absence of a record of an assignment of the mortgage or of the transfer noted upon the record of mortgage, the mortgage is presumed to be owned by and controlled by the mortgagee, and that all men may deal with the mortgage or the land, resting upon this presumption, in the absence of actual knowledge of the assignment of the *Page 951
mortgage. In support of this proposition, Parmenter v. Oakley,69 Iowa 388, is cited.
The proposition affirmed by appellee must be read in the light of the facts of any given case. It is true that the same reason exists to require the assignee of a mortgage to record the assignment, as to require the mortgagee to record his mortgage, but in each case it is a subsequent purchaser for value, without notice, that is within the contemplation of the rule.
The law is well settled in this state that the payment of a negotiable promissory note to a person other than the owner or his agent is at the debtor's risk. See Shoemaker v. Minkler,202 Iowa 942, with cases cited; Farmer, Thompson Helsell v. Bank ofGraettinger, 130 Iowa 469.
The defendants, under the instant facts, cannot be viewed as subsequent purchasers for value, within the meaning of Code Section 10105.
II. Do the facts and circumstances sustain the appellee's plea of estoppel, in that the assignor Plumb was the agent of his assignee Augustine in the instant transaction? 2. BILLS AND If this plea is sustained by the evidence, then NOTES: the equities of the cause are with the payment: defendant-appellee. implied or inferred agency.
The doctrine of estoppel is well recognized in the law of agency. It is frequently applied. It must be based on facts for which the principal is responsible. It is a question of fact, to be determined by the facts and the reasonable inferences to be drawn therefrom. The authority need not be expressly conferred, and in the majority of cases it is informally conferred, or is inferred from the acts and conduct of the principal. The important thing is to find the assent of the principal, either express or implied. See Harrison v. Legore, 109 Iowa 618.
An agent may take the initiative, and perform services which the principal may accept. This is as binding on the principal as though the principal took the initiative and requested or directed the agent to act. The doctrine of agency by implication from acts or conduct runs through judicial decision, and finds expression in the textbooks of all writers on the subject of agency. Acquiescence in the doing of the act at the time, or subsequent acquiescence in the act as done, especially if it evidences *Page 952
a course of conduct, may show the necessary assent or consent to bind the principal. Mechem says:
"It may be tacit or unexpressed in terms. It is often said that `silence gives consent,' but this is by no means always true. It is only true when from the failure to speak, under the circumstances, an inference of assent may fairly and reasonably be drawn. This is usually a question of fact." Outlines of Agency (3d Ed.), Section 102.
It is also recognized that, where the acts are several in number or in frequency, until they indicate a course of conduct or a continuing purpose, the probative force is increased, so that it may reasonably justify an inference of assent to the act in question. Therefore, although no authority has actually been conferred, the principal will not be permitted to deny it, where by his conduct he has asserted it, if such denial would prejudice an innocent third person.
In the case at bar, it is undisputed that the defendants did make payments of interest and principal to the mortgagee. The evidence is undisputed that plaintiff's decedent did receive said interest payments regularly on the notes secured by the mortgages in question, until Augustine's death. No demand was made or notice given to defendants by the administrator until October, 1923, 22 months after his appointment as administrator.
The instant administrator testified that, after his appointment in December, 1921, he did not know, until August, 1923, that Mr. Ragland kept on paying J.D. Plumb, and that during this time he (administrator) was carrying on negotiations with Plumb for renewing or taking up the paper. At that time, Plumb was living in Marshalltown, and was reputed to be solvent.
There were some 30 similar transactions had between Plumb and Augustine, involving the notes and mortgages of different persons.
The administrator knew, shortly after his appointment, that Augustine had been receiving the regular interest payments, and knew that Plumb had been making them to Augustine. There is no evidence of denial that plaintiff's decedent did receive the payments on the principal made to plaintiff's assignor. It is admitted by plaintiff that the indorsements of interest payments on said notes were in the handwriting of Augustine. There *Page 953
was no default during Augustine's life, nor is it shown that plaintiff's administrator ever claimed a default. The assignee received the interest payments from Plumb, his assignor, with full knowledge of the source of the payments, to wit, from the mortgagor. There would be no presumption or inference that Plumb was making gratuitous payments, or that said payments were made by Plumb as a guarantor of the notes. A guarantor is not liable for the payment of a note until the default of the maker. Augustine consistently and repeatedly received the interest from Plumb, and it would be most unusual conduct on the part of a guarantor, as such, to make regular interest payments or to make partial payments without any demand by the holder against the maker. Furthermore, Plumb could become liable for the interest only when he became liable for the principal. Augustine concealed his ownership of the notes and mortgages, and he knew that the makers did not know that Plumb had parted with the notes. All of these parties lived in the same town, and, under the circumstances of this case, Augustine knew that Plumb was collecting the interest regularly on the notes and bringing it to him. Augustine thereby made himself an undisclosed principal to Plumb, as his agent. He must have known also that the maker of the note was just as likely to pay Plumb the principal on the mortgages as he was to pay the interest, and, for aught that appears, Plumb may have paid Augustine the principal.
We cannot escape the conclusion that Augustine intentionally withheld from the makers all knowledge of the transfer of the notes, knowing all the time that Plumb was collecting the interest and bringing it to him, and thereby using Plumb as a means to an end. His motive becomes material, under the facts in this case.
Intentional concealment on the part of Augustine amounts to an affirmative fraud on his part, and a court of equity should not wink at such a transaction. The eyes of the chancellor never look obliquely, and when the blush comes to his cheek, he is ready to act.
Under the facts and circumstances of this case, the equities are with the defendant-mortgagors. The decree entered by the trial court is — Affirmed.
EVANS, ALBERT, and MORLING, JJ., concur. *Page 954
STEVENS and FAVILLE, JJ., dissent to Division II.
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The above-named bank at Sioux City closed its doors and a receiver was appointed for it in December, 1931. In March, 1932, a petition in equity was filed alleging the insolvency of the bank; that its assets, plus the one hundred per cent assessment on all stockholders, would not produce sufficient to pay the debts of the corporation; and asking judgment against George M. Paradise, as a stockholder, for one hundred per cent superadded liability under the aforesaid section of the statute. The case was tried, and as here presented the first question in the case is whether or not George M. Paradise ever became a stockholder in said bank within the meaning of said section of the statute.
The record shows that one Olof Nelson was president, and C.A. Norrbom was cashier of said bank at all times involved herein, and that Nelson was the owner of 525 shares of stock in said corporation. In December of 1929, or January of 1930, Nelson and Norrbom both talked to the appellant about purchasing stock in said corporation; and Paradise testifies that in the latter part of January "we arrived at an agreement to buy stock in the bank". He further testifies that: "My understanding was that the bank had some stock to sell." The agreement was oral. "I did not know or understand that I was buying stock owned by Nelson. Nelson said he thought it would be wise to buy stock of the bank, and there was some stock in the bank that I could buy, that they had issued additional stock in 1919, as I recall it, and there was some stock of that left. I never agreed to buy stock, and never understood that I was buying stock that was owned by Nelson."
Nelson testifies: "I think I suggested or mentioned to him (Paradise) that he should buy about ten shares of stock. Q. Did you ever tell Mr. Paradise that the bank would sell him some stock? A. I don't think so because they had none to sell and I had plenty."
Neither Nelson nor Norrbom, although they both talked to Paradise about selling him stock, ever told him that they proposed to sell him stock that belonged to Nelson. The record shows that Nelson was disposing of part of his stock in the bank, and apparently was attempting to get from under liability by disposing of his stock.
It is apparent from the reading of this record, without setting out the testimony in detail, that at all times Paradise was *Page 409
led to believe, and he understood, that he was buying this stock directly from the bank and not from Nelson. He is confirmed in this understanding by the checks (four in number) which he issued as part payment of this stock, because each of them is payable to the bank and not to Nelson. Paradise testifies that if he had known and understood that he was buying stock that belonged to Nelson he would not have bought the same. He is confronted, however, with the original stock book of the corporation, which shows that on January 17, 1930, he receipted for ten shares of stock. His claim is that at the time he signed the stub in said stock book, neither the stub nor the original certificate of stock was filled out. His claim is that his signature therein appearing was put on after the date that appears, and that the certificate of stock introduced in evidence, by which he is alleged to have become the owner of ten shares of stock, was filled in without his knowledge or consent. It is admitted that this said certificate never left the hands of the bank and was there at the time the receiver was appointed. Paradise testifies that it was never delivered to him, and the officers of the bank confirm him in this statement.
This is a rough statement of the record most favorable to the appellant.
In the application of Code section 9251 we have said that the question is, who is the real owner of the stock, even though it has not been transferred on the books of the corporation. Andrew v. Sanford, 212 Iowa 300, 233 N.W. 529; Bates v. Peru Savings Bank, 218 Iowa 1320, 256 N.W. 286; Andrew v. Peoples Saving Bank,211 Iowa 649, 234 N.W. 542; Andrew v. American Savings Bank
Trust Co., 219 Iowa 921, 258 N.W. 911.
The question at this point, therefore, is: Who is the actual owner of this stock? It appears from the record that Nelson held a certificate for fifteen shares of stock, and that he presented the same to the corporation and new certificates were issued by splitting the original certificate and making one to Paradise for ten shares and the other to Nelson for five shares. The date on which this occurred is left in doubt under the record. The original contract between these parties was oral. The record is quite satisfactory that Paradise agreed to buy ten shares of stock in the corporation. The point of divergence is whether or not he was buying ten shares of stock that belonged to the corporation, or ten shares of stock that belonged to Nelson. *Page 410
We have this situation, then — that Nelson was intending to sell Paradise ten shares of stock that belonged to him; and we think that the record fairly shows that Paradise understood that he was buying ten shares of stock that belonged to the corporation itself.
With this situation we advert to the primary principle underlying all contracts, to wit, that in order to make a good contract there must be a mutual meeting of the minds, on the same thing at the same time. We are satisfied from this record that there never was a time when the minds of the officers of the bank and Paradise met on the same proposition. In other words, as above stated, Nelson, without so advising Paradise, was attempting to sell his own stock to Paradise; and on the other hand, Paradise understood at all times that he was not buying stock that belonged to Nelson, but that he was buying stock that belonged to the corporation. It follows, therefore, that there never having been a meeting of the minds on this proposition, no contract was made. It therefore follows that Paradise is not the owner of the stock, and that Nelson is.
Appellee argues that Nelson is not an interested witness because the result makes but little difference to him. With this we cannot agree. It makes just one thousand dollars difference to him. That is, if Paradise is compelled to pay the assessment on these ten shares of stock on the par value of one hundred dollars each, Nelson will be relieved from such payment. He is, therefore, very materially interested in the outcome of this case.
We think the court was wrong in its conclusion and that what the bank itself may have done, without the knowledge or consent of Paradise as to reporting him as a stockholder to the state department and so noting him on the records, is not binding on him.
Paradise had made a $400 payment on this contract by checks drawn payable to the bank and which the bank records show eventually went into an account belonging to Nelson. He counterclaims in this matter, asking to recover the $400. We do not think he is entitled to it under the record in the case, if for no other reason than that the claim for the $400 was not filed with the receiver within the time ordered by the court. — Reversed.
MITCHELL, KINTZINGER, DONEGAN, HAMILTON, ANDERSON, and STIGER, JJ., concur. *Page 411
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This is an action to vacate a judgment and *Page 1115
for a new trial, and is based upon Subdivision 2 of Section 12787 of the Code of 1924, which is as follows:
"For fraud practiced in obtaining the same."
The original judgment was entered in the district court of Keokuk County, at the February, 1925, term thereof, and this action was commenced within one year thereafter. For full statement of the facts and issues involved in the original action, which was to subject certain real estate incumbered by a $10,000 mortgage to the payment of a judgment in favor of appellant, see opinion therein filed at the present term of this court.
Appellees A.M. Blaise and Dena Keck testified, upon the trial of the original action, that $3,100 of the consideration of the $10,000 mortgage executed by Dena Keck on February 19, 1924, upon a 200-acre tract of land in Keokuk County to A.M. Blaise, represented a loan of that amount by the latter to the former, and did not represent a part of the consideration of the $10,000 mortgage. Appellant now alleges that this testimony was false and perjured, and that the said $3,100 check was in fact executed by Blaise in payment of a loan which he was then owing Dena Keck, and which was secured by a mortgage upon real estate duly recorded in Keokuk County. Appellant also alleged that he did not know of or discover the falsity of the testimony of the said Keck and Blaise until April 14, 1925, and that he could not by due diligence have discovered the same at an earlier date.
Evidence tending to sustain the allegations of the petition and to prove the falsity of appellees' testimony was introduced upon the trial. The court below held that the matters set up in the petition and established by the proof do not constitute such fraud, within the meaning of Subdivision 2 of Section 12787, Code of 1924, as entitled appellant to have the judgment and decree vacated and a new trial granted. The rule is practically universal that perjury or false testimony as to any intrinsic matter does not afford a ground for the vacation of a judgment or the granting of a new trial. The question has been repeatedly before this court, and such has been the uniform holding. To constitute fraud, within the meaning of the statute, the false testimony must relate to some matter collaterally affecting, or extrinsic to, the merits of the case. Aschan v. McDermott, *Page 1116 164 Iowa 750; Kwentsky v. Sirovy, 142 Iowa 385; Sudbury v.Sudbury, 179 Iowa 1039; Williamson v. Williamson, 179 Iowa 489;Croghan v. Umplebaugh, 179 Iowa 1187; Bradbury v. Wells, 138 Iowa 673; Sullivan v. Herrick, 161 Iowa 148; Graves v. Graves,132 Iowa 199. See, also, 3 Freeman on Judgments (5th Ed.), Section 1245 et seq.
Appellant contends, however, that the facts of this case bring it within the rule as modified and stated in Graves v. Graves,
supra. It was claimed in that case that the defendant by committing perjury concealed property, and prevented a decree awarding proper alimony to his wife. This evidence was held to relate to extrinsic matters, and for that reason, it was held, a fraud was perpetrated upon the court. The case goes no further than to recognize the practically universal rule, and to hold, under the facts of that case, that the showing made was sufficient. The reasons for the rule have been so often fully and clearly stated by this court that they need not be repeated. The perjury, if any was committed in the present case, related to purely intrinsic matters, as to which the judgment is final unless reversed on appeal. The decree is affirmed. — Affirmed.
FAVILLE, VERMILION, and ALBERT, JJ., concur.
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The evidence tends to show that on the night of April 22, 1933, two strange men entered a store operated by Mr. Maurer, and, at the point of a gun, held up and demanded money from Mr. Maurer, and Mr. and Mrs. Anderson, employees in the store. One of the men took $2 from Mr. Anderson, $15 from Mr. Maurer, and the other took $115 in currency and about $170 in checks from the cash register.
The state offered as witnesses the three occupants of the store, on the night of the robbery, and they all testified that the defendant was one of the men who entered and held up the store that night.
The defendant introduced many witnesses to prove an alibi. Their testimony tended to show that he was not in Renwick that night; that he was at another place distant from Renwick, and if their testimony be true, the jury would have been warranted in finding that he could not have been at the scene of the crime when it was committed.
[1] I. Appellant contends that the court erred in refusing a new trial because of misconduct of counsel in the following particulars: In his opening statement, the county attorney said:
"Mr. Maurer was just closing his store to go home shortly after midnight; that he had $130 and a roll of checks in his pocket, when these two young men came in. One of them is a man by the name of Harris, who is now serving time at Anamosa. Peculiar to the code these men operate under, he refuses at this time to come into court."
This statement was objected to by appellant as improper.
The county attorney also said:
"He, (defendant), has pleaded not guilty. An arraignment was bad before that, and a bond was fixed in the sum of $2,000. He was unable to raise the amount of the bond."
Appellant's counsel "objected to any statement in relation to his inability to raise bond, because the same is immaterial and incompetent." Whereupon the court said:
"I think, Mr. County Attorney, it is your duty to state *Page 144
to the jury what the issues are, and what the offense is, and then relate * * * in a short manner the substance of the testimony you expect to prove."
No request was made by appellant that the court admonish the jury, by instruction or otherwise, to disregard either of such remarks; and no exception was taken by appellant of the court's failure so to do. The court fairly instructed the jury that the burden was upon the state to prove defendant's guilt beyond all reasonable doubt. At the time these statements were made, there was no request for a mistrial, or for an admonition to counsel or to the jury, and the trial proceeded without any further reference thereto. While the remarks made by counsel are not to be commended, we do not find they were sufficiently prejudicial to warrant a reversal.
[2] II. Complaint is also made of the court's order excluding witnesses from the court room. This request was made by the county attorney during the examination of Mr. Maurer, the state's first witness. The court sustained the request, and made an order excluding all witnesses from the court room, except Mr. Maurer, the prosecuting witness. Until this request was made, only one other state witness was in the court room. Thereafter, all witnesses except Mr. Maurer, were excluded. A number of witnesses testified for the defendant, but the record does not show how many of them were present before the order was made. There is nothing in the record tending to show that the defendant was in any manner prejudiced by the order. This matter is peculiarly within the discretion of the trial court and we find no error therein. Crull v. Louisa County, 169 Iowa 199, 151 N.W. 88; State v. Smith, 192 Iowa 218, 180 N.W. 4.
[3] III. Appellant also contends that the court erred in instructing the jury that the burden was upon the defendant to establish the defense of "alibi" by preponderance of the evidence. The instruction complained of tells the jury that "The burden of establishing an alibi is upon the defendant who relies upon it, and the defendant, in order to rely upon an alibi, must prove the same by a preponderance of the evidence."
The rule of law in this state is well settled that in order to sustain this defense it must be established by a preponderance of the evidence. This is the clear meaning of the instruction complained of, and is in line with the rule established in this *Page 145
state. State v. O'Brien, 188 Iowa 165, 175 N.W. 769; State v. Wrenn, 194 Iowa 552, 188 N.W. 697; State v. Shields, 195 Iowa 1360, 192 N.W. 521; State v. Bird, 207 Iowa 212, 220 N.W. 110.
In instruction No. 10, the court said, inter alia:
"So in this case if the defendant has proven by a preponderance of the evidence that he was not present at the time and place of the alleged criminal act, then you should find him not guilty. But if he has failed to show by a preponderance of the evidence that he was not present at the time and place of the alleged criminal act, then you should disregard the defense of alibi. * * * If upon the whole case the testimony before you raises in your mind a reasonable doubt that the defendant was present at the time and place in question, then it will be your duty to give the defendant the benefit of that doubt and acquit him."
We think these instructions fairly state the rule on the defense of alibi, and come within the well established rules laid down by this court thereon. The instructions given correctly state that rule of law with reference to the burden of proof on alibi and we find no error therein.
[4] IV. Appellant complains of instruction No. 10 also relating to the defense of alibi, because it was not sufficiently clear and specific in failing to explain what is meant by the term "whole case". That part of instruction No. 10 complained of is hereinabove set out. It is our conclusion that the instruction fairly presents the law and is good as far as it goes. If appellant had desired a more explicit instruction upon this question, it should have been requested. No such request was made, and as the instruction is good as far as it goes, we find no prejudicial error therein.
[5] V. Appellant also claims that the jury, in arriving at their verdict, was guilty of misconduct in considering the question of a possible parole of defendant by the court. The following recommendation was made in this case:
"Upon due consideration of all the circumstances of the case, we respectfully recommend to the court that the defendant be paroled by the court." (Signed by all the jurors.)
It is apparent from this recommendation that it must have *Page 146
been signed after the verdict was reached. Juries seldom reach a verdict on the first ballot, and sometimes many ballots, during a period of many hours, are taken before a verdict is reached. It is also a matter of common knowledge that in criminal cases juries sometimes make a recommendation for leniency to the court. The fact that a jury makes such a recommendation can hardly be considered sufficient misconduct to warrant a reversal of the case. It is the well-settled rule of law in this state that "it is not competent to show by affidavit of the jurors what influenced the verdict, for this necessarily is mere matter of opinion, and essentially inheres in the verdict itself." State v. White, 205 Iowa 373, loc. cit. 376, 217 N.W. 871, 872; State v. Gilliland, 187 Iowa 794, 174 N.W. 496; State v. Kirk, 168 Iowa 244, 150 N.W. 91; State v. Taylor, 202 Iowa 189, 209 N.W. 287.
VI. Appellant also claims that defendant is entitled to a new trial because the evidence is insufficient to support the verdict. We have carefully considered the evidence, as substantially disclosed in the statement of facts hereinabove set out. While the evidence on the defense of alibi is very strong, and may have been sufficient to warrant a verdict of not guilty, it is not within our province to rule on the facts. There was a sufficient conflict in the evidence to make that question one of fact for the jury.
VII. Error is also claimed because of the court's rulings on the objections to certain testimony. We have considered these objections, but find no merit therein.
For the reasons hereinabove set out, the judgment of the lower court is hereby affirmed. — Affirmed.
ANDERSON, C.J., and all Justices concur.
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On the 9th day of January, 1933, a petition for a writ of habeas corpus was filed in the district court of Lee county at Fort Madison, Iowa, in behalf of James Davis, the appellant. The petition alleges that James Davis is now illegally imprisoned and restrained of his liberty by the warden of the penitentiary without due process of law, contrary to article I, section 9 of the Iowa Constitution, and the Fourteenth Amendment to the Constitution of the United States; that he is a citizen of the United States and is restrained by virtue of a void commitment and a void judgment pronounced by the district court of Page county, Iowa; that said judgment is void for lack of jurisdiction, as it was entered upon a verdict of a jury finding the defendant not guilty of an offense charged in the indictment; and by reason of the fact that the court imposed an indeterminate sentence, not exceeding life. The petition was presented to the Hon. John M. Rankin, judge of the district court of Lee county, Iowa, and the writ was refused; the court indorsed thereon the following: "Writ denied because of insufficiency of petition, John M. Rankin, Judge." From such refusal the appellee prosecutes this appeal.
The record is very incomplete and unsatisfactory. It presents nothing except the petition for the writ, the order refusing the same and certified copies of the indictment, verdict, and a portion of the court's order pronouncing sentence in the original case; and the only errors assigned and relied upon are:
1. That the district court erred in refusing to grant the writ and in not ordering the release of the appellant from further confinement, for the reason that the district court of Page county was without jurisdiction to impose the original sentence upon the verdict as returned by the jury, and that the judgment, verdict, and commitment upon which the appellant is now being confined are null and void.
2. That the district court of Page county was without jurisdiction to impose sentence for an indeterminate period not *Page 1180
exceeding life, and that an indeterminate sentence could not be pronounced for a violation of section 13002 of the Code of Iowa.
It will be noticed that no assignment of error is made because the court erred in denying the issuance of the writ by reason of the insufficiency of the petition.
Section 12468 of the 1931 Code provides that the petition for the writ of habeas corpus must state:
"4. That the legality of the imprisonment has not already been adjudged upon a prior proceeding of the same character, to the best knowledge and belief of the applicant.
"5. Whether application for the writ has been before made to and refused by any court or judge, and if so, a copy of the petition in that case must be attached, with the reasons for the refusal, or satisfactory reasons given for the failure to do so."
Section 12474 provides:
"If the writ is disallowed, the court or judge shall cause the reasons thereof to be appended to the petition and returned to the person applying for the writ."
Where the allegations of the petition are in conformity to the statute and are sufficient to authorize the writ, the judge or court acquires jurisdiction of the parties and the subject-matter. Nowhere in appellant's petition is it alleged that the legality of the imprisonment has not already been adjudged by a prior proceeding of the same character, nor that application for the writ has not been before made to and refused by any court or judge. We think the provisions of section 12468 of the Code are mandatory, and that, in order to give the court jurisdiction of the parties and subject-matter, the petition for the writ must conform to the provisions of the statute, and that the trial court was right in denying the writ by reason of insufficiency of the petition. In fact, no other order could have been made without ignoring the plain mandate of the statute. See Smith v. Hollowell, 216 Iowa 1219, 250 N.W. 646.
On the merits of other allegations of the petition, we might say that we have held that the correctness of the rulings and judgment of a court in a pending criminal action in which it has full jurisdiction of the subject-matter and of the parties will not be reviewed *Page 1181
on habeas corpus. Van Scoy v. Gretten, 177 Iowa 431,158 N.W. 510; Smith v. Hollowell, 209 Iowa 781, 229 N.W. 191.
The ruling of the trial court is affirmed. — Affirmed.
ALBERT, C.J., and EVANS, STEVENS, KINDIG, KINTZINGER, and MITCHELL, JJ., concur.
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The real estate involved herein is known as the Stratford Hotel in Des Moines, Iowa. Defendant bank acquired title thereto in 1934 following foreclosure of a mortgage. The property is used as a hotel. Defendants John and Kate M. Rolfsema have operated the hotel continuously since 1931 and were in possession as tenants for that purpose when the bank acquired title to the property. On December 17, 1936, the bank entered into a written lease with the Rolfsemas for the period January 1, 1937, to April 1, 1942, at a monthly rental of $250 during 1937, $300 during 1938 and 1939, $350 thereafter, and providing that the lessees should keep the premises in repair. The Rolfsemas have had exclusive possession of the premises under such lease. The bank assigned its interest in the property and the lease to the Valley Des Moines Company.
Plaintiff was a guest at the Stratford Hotel for some time and on May 19, 1940, was employed by Mrs. Rolfsema temporarily as night clerk in the hotel. Plaintiff asserts that the elevator on the premises was not equipped and maintained as required by sections 1678 and 1684.1 of the Code, 1939, that about midnight of May 19, 1940, he undertook to use the elevator to answer a buzzer call, fell into the elevator pit and was injured. He asserts that defendants were negligent in failing to maintain the elevator as required by statute, in failing to warn him of the defective condition, in operating the elevator with insufficient light, in failing to inspect the elevator and make repairs of its mechanism, and that he was free from contributory negligence.
Defendants Valley Savings Bank and Valley Des Moines Company moved to strike the cause of action against the Rolfsemas. This motion was overruled but the court granted separate trials to the two sets of defendants. The bank and the Valley Des Moines Company filed answers which asserted general denials, the transfer of the property and the lease to the Valley Des Moines Company and that said company as owner and lessor was not liable to plaintiff. Plaintiff filed a reply which asserted that the Valley Des Moines Company is a mere holding company for the bank.
The case proceeded to trial against the bank and the Valley Des Moines Company. Evidence was introduced by plaintiff *Page 21
which showed the acquisition of title to the building by defendant bank, the occupancy of the property by Rolfsemas, the written lease in regard thereto, the purported transfer of interest in the property and lease by the bank to the Valley Des Moines Company, the temporary employment of plaintiff as night clerk for the Rolfsemas on May 19, 1940, his use of the elevator in the course of such duties and the accident about midnight which caused the injuries for which he seeks recovery of damages.
At the close of plaintiff's evidence, the defendants made a motion for a directed verdict in their favor for the following reasons: The evidence fails to show any negligence on the part of defendants that was the proximate cause of the injury; the plaintiff failed to establish freedom from contributory negligence; the premises are shown to have been leased to the Rolfsemas who had entire control of same, including the elevator, and any defects therein are not chargeable to defendants as landlords, who had no notice of same; under the provisions of the lease, defendants would not be liable except through palpable neglect on their part which has not been shown; the bank had parted with its interest in the property and lease and owed no duty to plaintiff. The court sustained the motion generally, judgment was entered accordingly and plaintiff appeals. The only errors asserted as grounds for reversal pertain to the ruling on the motion for a directed verdict.
[1] I. Plaintiff's first assignment of error asserts that defendants are liable herein because the evidence shows that the elevator, at the time of the lease to the Rolfsemas and continuously thereafter to the time of plaintiff's injury, was inadequately lighted and not equipped as required by sections 1678 and 1684.1 of the Code, 1939. We find no merit in this assignment.
Defendants assert that the plaintiff failed to establish that the premises were inadequately lighted. Without undertaking to review the evidence on this issue, suffice it to say that the evidence is undisputed that adequate lighting facilities were furnished. If there is any basis for the claim that the vicinity of the elevator was inadequately lighted, this condition was created by plaintiff, as night clerk, turning off a number of lights. He testified that he did this at the direction of Mrs. Rolfsema. Even *Page 22
so, we are unable to find any rule of law which would hold the defendants, as owners and lessors of the building, responsible for such condition upon the facts shown by this record. The cases upon which plaintiff relies are clearly distinguishable.
The statutory provisions regarding the equipment of the elevator upon which plaintiff relies are the following: Section 1678 of the Code, 1939, provides, "Every elevator and elevator opening and machinery connected therewith * * * shall be so constructed, guarded, equipped, maintained, and operated as to render it safe for the purposes for which it is used." Section 1684.1 provides, "The hoistway doors and gates of all passenger elevators shall be equipped with an approved interlock (locking device), electrical, mechanical, or electro-mechanical, which will prevent the normal operation of the elevator car: unless the hoistway door at which the car is standing is closed and locked; or unless all hoistway doors are closed and locked; and second, shall prevent opening the hoistway door from the landing side except by a key or special mechanism; unless the car is standing at the landing door."
Plaintiff testified that the mechanism of the elevator did not function in conformity with the statute last above quoted. He used the elevator on several occasions before he received his injury. On each occasion, he was able to open the elevator door from the landing side without any key or special mechanism. However, the pictures of the elevator door and the testimony in regard to it show that the elevator door was equipped with an interlock such as contemplated by this statute. The reason why plaintiff was able to open the door from the landing side was not due to the absence of such equipment, but solely to the fact that the equipment was not in proper adjustment. In view of this record, it is important to consider the testimony regarding the duration of such defective adjustment and the notice or knowledge of defendants in regard thereto.
The case is unusual in that the tenants were in possession and control of this building before the defendants acquired title thereto and became landlords thereof. Plaintiff, however, asserts that the evidence establishes that the defective condition existed before the lease was made and continuously to the time of his injury. We have carefully examined the record and are unable *Page 23
to find any satisfactory evidence that this defective adjustment of the mechanism of the elevator existed prior to January 1, 1937. Neither do we find any evidence that the defendants had notice or knowledge of such condition. Defendants contend that, in the absence of a showing that the condition existed prior to the commencement of the lease and notice or knowledge on the part of defendants of such condition, plaintiff has failed to establish any basis for liability on their part. We find merit in this contention.
Plaintiff relies upon our decision in the case of Burner v. Higman Skinner Co., 127 Iowa 580, 103 N.W. 802. This case states the rule at page 585 of 127 Iowa, page 804 of 103 N.W., as follows:
"To this general rule of nonliability on the part of the landlord there are exceptions * * *. Another exception exists where there is a defect in the premises leased, existing at the time of the demise, that constitutes a nuisance which it is the duty of the landlord to abate. In such cases both the landlord and the tenant are liable — the former as author and the latter as continuor of the nuisance. Of course, the landlord is not liable for nuisances created during the term covered by the lease, unless he in some manner actively contributes to the creation thereof."
And again, at page 588 of 127 Iowa, page 805 of 103 N.W., we state:
"Had they retained no control over the elevator, there would have been no liability, in the absence of a showing that at the time they leased the premises there was a nuisance, of which they had knowledge, and which it was their duty to abate."
Plaintiff undertook to prove that the interlock on the elevator door was not properly adjusted at the commencement of the lease, January 1, 1937, by the testimony of one Edgar J. Robb, a former employee at the hotel, who testified as follows:
"My employment at the Stratford Hotel was from August 3, 1936, to November 10, 1939, approximately three years and three months. There was a locking device on the elevator doors. *Page 24
* * * There have been times during my employment that I was able to open the door from the outside on the lobby floor. When the cage itself was not at the landing floor by taking hold of the bars and jerking it back, it would release. I remember about three occasions. The delivery man came in with some hotel supplies to deliver to the hotel and had been in the habit of putting them on the elevator. In the meantime, John Rolfsema had the elevator upstairs and this man came in and took hold of the door and was about to step in and I hollered and said to be careful that the elevator was up. He had opened it while the elevator was up and away from the landing. * * * The laundry man jerked the door open about two years ago. I didn't charge my memory with it at that time so I don't know. It was earlier in 1938. My best judgment is it was in the forepart of 1938. I didn't charge my memory at the time so I know nothing of it. The laundry man opened the door with his left hand, he jerked the door."
We do not think that this testimony was sufficient to meet the burden cast upon the plaintiff. A case which seems to be particularly in point is that of Fraser v. Kruger, 8 Cir., S.D., 298 F. 693, 696, 699, wherein the court states:
"The general rule is well settled that the duties and liabilities of a landlord to persons on the leased premises by the invitation of the tenant are the same as those owed to the tenant himself. A subtenant, servant, employee, or guest of the tenant is ordinarily held to be so identified with the tenant that his right of recovery for injury as against the landlord is the same as that of the tenant would be had he suffered the injury. This is true because such persons enter under the same title as the lessee, and not at the invitation express or implied of the landlord. [Citing cases.]
"Where there is no agreement by the landlord to repair the demised premises, and he is not guilty of any fraud or concealment by failing to disclose hidden defects of which he has knowledge, the tenant takes the risk of their safe occupancy, and the landlord is not liable to him or to any person entering under his title or by his invitation for personal injuries sustained by reason of their unsafe condition. [Citing cases.] * * * *Page 25
"There is nothing in the evidence from which the jury could have determined either the time when the blocks were nailed on to the elevator so as to prevent the safety device from functioning or who placed them there. There is no more reason to believe that it was done by the employees of the landlord than by the employees of the tenant. * * * Under the circumstances if the jury had been called upon to decide who was responsible for the blocking of the safety device they would have had to make a mere conjecture or guess, and the burden was upon plaintiff to produce not facts from which the jury might guess but facts from which they might reasonably find that the defective condition existed at the time of the making of the lease, or at least at the time the tenant took possession and control."
As above pointed out, plaintiff was under a duty to produce not facts from which the jury might guess but facts from which the jury might reasonably find that the defective condition existed at the time of the making of the lease. Plaintiff's evidence shows that the condition existed in the early part of 1938. But for the jury to say that it existed prior to January 1, 1937, would be mere guesswork. The testimony also fails to show notice to or knowledge by defendants of any defect in the mechanism. We hold that the evidence is insufficient.
[2] II. Plaintiff's third and fourth assignments of error assert that defendants, as landlords, by leasing the property to the Rolfsemas, were not thereby released from the duty to comply with the statute regarding the construction and equipment of the building. The argument suggests that the common-law rule, discussed in Division I of this opinion, has been abrogated by the statutes relied upon. We find no merit in such contention.
A contention, somewhat analogous to that made herein, was asserted in the case of Johnson v. Carter, 218 Iowa 587, 591,592, 593, 255 N.W. 864, 866, 867, 93 A.L.R. 774, wherein we state:
"It thus appears that of the cases cited by appellant, the only one that can be accepted as supporting appellant's claim that the provision of the Housing Law imposes a liability upon the landlord to keep a rented dwelling in repair, and that a *Page 26
failure to do so is negligence per se, is Annis v. Britton, supra, decided by the Supreme Court of Michigan.
"On the other hand, the appellee contends that the whole purpose of the Housing Law of this state was to promote the health, safety, and welfare of the people in general, and that there was no intention on the part of the legislature to change the common-law rule relating to the recovery of damages on account of the negligence of landlords. * * *
"Neither the title of the act nor the body thereof contains any specific provision showing that it was the intention of the legislature to impose upon the landlord a civil liability for damages to the tenant for injuries growing out of the failure to keep a dwelling house in repair, and the only liability imposed for a violation of this provision of the statute is penal in its nature. Appellee cites the cases of Palmigiani v. D'Argenio,234 Mass. 434, 125 N.E. 592, and Vallen v. Cullen, 238 Mass. 145,130 N.E. 216, in which the Supreme Court of the state of Massachusetts construed the provisions of a statute of that state relative to buildings in the city of Boston. * * *
"We are inclined to the view that the construction placed upon statutes of this nature by the Massachusetts court is preferable to that of the Michigan court. We feel that the lack of any specific reference, either in the title or in the body of the Iowa Housing Law, to the relation of landlord and tenant, and the absence of anything in either the title or the body of the law to indicate an intention to change the common-law rule and impose civil liability upon the landlord for damages sustained by a tenant growing out of a failure to repair in the demised premises, indicate that there was no intention on the part of the legislature to change such rule and impose such liability."
We think that the language above quoted is applicable to plaintiff's contentions herein. Section 1678 of the Code, 1939, was originally enacted as section 1, chapter 18, Acts of the 40th General Assembly. Section 1684.1 of the Code, 1939, was originally enacted as section 4, chapter 31, Acts of the 41st General Assembly. Neither the title nor the body of either statute contains any specific provision showing that it was the *Page 27
intention of the legislature to impose upon the landlord a civil liability for damages to an employee of a tenant growing out of failure of the tenant to keep an interlock on an elevator door in proper adjustment. We hold that such statutes did not change the common-law rule that is applicable herein.
Other questions are argued in the briefs. It is not necessary to discuss or decide them. The order sustaining the motion for a directed verdict was right. The judgment is affirmed. — Affirmed.
SAGER, BLISS, GARFIELD, STIGER, WENNERSTRUM, HALE, and OLIVER, JJ., concur.
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432244/
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The legal question involved in this case arises out of a sheriff's sale under special execution of an eighty-acre farm, forty acres of which constituted the homestead of the defendant. Prior to the date of the sale, the defendant caused notice to be served upon the sheriff demanding that he sell the nonhomestead forty first, and if this failed to bring sufficient to satisfy the judgment debt, that then the homestead be sold to make up the deficiency. The sheriff's return states:
"I first offered the NW 1/4 of the SE 1/4 of Section 36, Twp. 88, N., Range 48, and A.L. Sencenbaugh then and there bid the sum of $2,000.00 for said forty acre tract; I then offered the NE1/4 of the SW1/4 of Section 36, Twp. 88, N., Range 48, being the homestead of the defendants, and the said A.L. Sencenbaugh then and there bid the sum of $3,000.00 for said forty acre tract; I then offered said real estate as a whole and The Prudential Insurance Company of America, a corporation, then and there bid the sum of Eight Thousand Two Hundred Twenty-two and 85/100 Dollars for said real estate in a body; and the bid of The Prudential Insurance Company of America, a corporation, * * * for said real estate in a body being more than the aggregate of said separate bids, I then and there struck off and sold said real estate in a body and sold same to The Prudential Insurance Company of America, a corporation *Page 1121
for the sum of Eighty-two Hundred Twenty-two and 85/100 Dollars, it being the highest and best bidder therefor, etc."
The defendant filed a motion to set aside the sheriff's sale on the sole ground that forty acres of the mortgaged premises constituted his homestead and should have been sold separately after exhausting the nonhomestead property. The lower court sustained defendant's motion and plaintiff appeals.
The judgment was for $8,256.17 debt, and $144.20 costs. The decree of foreclosure ordered the real estate or so much thereof as might be necessary sold to satisfy said judgment, interest, and costs. A special execution commanded the sheriff, by levy and sale, to make the sum of the judgment, interest, and costs. It was therefore the official duty of the sheriff to sell, according to the statutes in such cases made and provided, the mortgaged property or so much thereof as became necessary to make the amount of the mortgage debt, interest and costs.
The sole question is, did the sheriff comply with the law in such cases made and provided, or is this sale void or voidable? In other words, was the officer bound to accept the $2,000 bid and strike off the property to the bidder before proceeding to sell or offer to sell the homestead forty?
Section 10150 of the Code of 1931 provides:
"The homestead of every family, whether owned by the husband or wife, is exempt from judicial sale, where there is no special declaration of statute to the contrary."
Section 10155 of the Code of 1931 contains the exceptions and among other things provides:
"The homestead may be sold to satisfy debts * * * created by written contract by persons having the power to convey, expressly stipulating that it shall be liable, but then only for a deficiency remaining after exhausting all other property pledged by the same contract for the payment of the debt."
The legality, and/or regularity, of the sale in question depends upon the construction to be placed upon the statutory phrase, "after exhausting all other property."
In an early case, Burmeister v. Dewey, 27 Iowa 468, 469, a case involving a homestead, in a very able and well-considered opinion by Justice Wright, we find this language: *Page 1122
"That the homestead was liable for the debt is not controverted. The only question is as to its order of sale, if necessary to satisfy the writ. By the law governing the subject it is declared, after providing that it may be sold in certain cases, of which this before us is one, that it shall not in theseinstances be sold except to supply the deficiency remaining afterexhausting the other property of the debtor which is liable to execution. Rev. section 2281. The mortgage made the debt a special lien — the judgment ordered its sale, the execution so directed, and as to its liability there remains, I repeat, no doubt. Assuming now that it was a question of power and not of mere regularity, was the other property named in the writ * * * exhausted, within the meaning of the law, before the homestead was sold. In my judgment, as applied to this case, it was."
In that case a two hundred forty-acre farm was involved, and the sheriff offered it in the smallest legal subdivisions and received no bids and then offered the entire tract and sold the same en masse. Quoting again from the cited case at page 475 of 27 Iowa, the court said:
"If the other property had been sold for a farthing, it would have been exhausted, and then the homestead could have been sold. Being no sale of the other property, the officer cannot make return as to the homestead, for he has nothing to return unless he makes an offer — or, making the offer, sells it. He acts in good faith — such is the presumption. We cannot indulge in any other. He advertises and duly endeavors to sell or exhaust the other property. The forty is liable upon a contingency, `I have demonstrated,' he says, `in the manner required by law, that the other property will not sell, will not pay the debt and now I will offer it in gross.' He sells it in gross and for a price (acting in good faith all the time, as we are bound to presume) — which further demonstrates that the other property would not pay the debt (there was still a balance due the mortgagee after the sale for $5,050) — and he does thus exhaust the other property. For he first demonstrates that it will not separately sell to pay the debt — and that with all together, the homestead and all, by exhausting all, the debt is still unsatisfied. * * * After the officer had offered the other tracts, he had the power to offer and sell all, as he did. And while if he had offered and sold all the balance first and then the homestead, it would not have been irregular, he was not bound to do so. And having the power, in his *Page 1123
discretion, to sell in one way or the other, no court of equity ought, after the lapse of nine years, of continuous and uninterrupted possession, to set aside the sale."
Again, in Connecticut Mutual Life Insurance Company v. Brown, 81 Iowa, page 42, 46 N.W. 749, 750, where the matter arose on a motion to set aside an execution sale, as in this case, the motions were overruled. It is not revealed in this case that any part of the land was the homestead of the defendant. The land was offered in separate tracts, and, there being no bids, was sold enmasse, and in construing the section of the Code which provides for sale in separate tracts, where notice to that effect is served upon the sheriff by the defendant, the court said:
"The section is intended to secure sales in separate tracts, as defendants in execution shall direct. It is not intended to defeat sales. A reasonable construction must be put on it, to the effect that, if the lands cannot be sold in separate tracts, for want of bidders, they may be afterwards offered, and sold enmasse, and such a sale is not per se void or voidable. If the entire tract, or the different tracts, for any reason, are more valuable when taken together, and will in that way sell for a larger sum, they may be so sold, and the sale will be subject to no objection by the landowner. The fact that no bids were made when the land was offered in separate tracts, and it was therefore sold en masse, raises a presumption that the land is more valuable when taken together, or, at least, that defendant in execution suffered no prejudice by the sale."
In the case of Glenn v. Miller, 186 Iowa 1187, 173 N.W. 135, 136, the question arose on a suit in equity to set aside an execution sale of land, on the ground that the sheriff abused his discretion in selling too much of the land at a wholly and grossly inadequate price, and the court granted relief, even after the sheriff's deed had been executed and delivered, the court holding that the sheriff abused his discretion in proceeding to sell the property without adjournment or effort to avoid the unnecessary sacrificing of plaintiff's property. Speaking of the sheriff's duties in this regard, Justice Weaver, speaking for the court, said:
"The sheriff is not the mere agent or servant of the judgment creditor. He is the officer of the law, and his duty to execute the *Page 1124
writ and collect the judgment is no more apparent or obligatory than is his duty to protect the debtor against an unjust or oppressive levy and sale. It is to that end that the statute gives him discretion to postpone the sale in the absence of bidders, or when confronted by bidders who offer only bids grossly out of proportion to the value of the property; and abuse of that discretion will invalidate his sale."
Again in State Bank v. Brown, 128 Iowa 665, 105 N.W. 49, 51, Judge Deemer, speaking for the court, used this language:
"The sheriff was an agent for the defendant Cooper, as well as for the other parties, and he in virtue of statutory authority treated the bid and sale as a nullity, and so reported to the court. As he could not have enforced the bid, neither may the defendant Cooper."
In this case the landowner sought to enforce a specific performance of a bid which the sheriff vacated because the bidder did not put up the money, claiming it was made under mistake of fact.
While it may be conceded that the duties of the sheriff in conducting execution sales are ministerial in their nature, yet in each of the two cases just referred to and in many others which might be cited we have recognized in some degree discretionary power lodged in the sheriff in the matter of conducting such sales. In the case of Security Savings Bank v. King, 198 Iowa 1151, 199 N.W. 166, 167, a farm of two hundred thirty-seven acres was sold in separate tracts at a very inadequate price over the objection of the mortgagee, who placed no competitive bids when the property was offered in separate tracts, but had a standing bid of $23,500 for the property as a whole. The aggregate of the separate bids amounted to only $4,000. There was no homestead question involved in the case, but the reasoning and holding of the court, we think, bears on the question of the construction of the statute under consideration. In the King case the construction was on the section of the Code granting to the defendant the right to demand the sale of the property in separate parcels, where he submits a plan of sale. Section 11732 of the Code of 1931 says "the officer shall sell [the property] according to said plan." In the King case the sheriff followed this out to the letter, and his action in that regard was held to be voidable because of the gross abuse of his discretion. In that case, Justice Stevens, speaking for the court, used this language: *Page 1125
"The statute has for its primary purpose the protection of the debtor against the sale of a greater portion of his land than is necessary to satisfy the execution levied thereon. In giving it this effect the interest and rights of the creditor cannot be wholly ignored. The whole of the land was pledged as security for the debt. The mortgage was not taken upon parcels, but upon the land as a whole. The effect of the holding below was to compel the creditor, in order to protect his security, to bid upon each of the separate parcels, and if the aggregate of his bids was less than the value of the entire tract and insufficient to satisfy the execution in full, to waive a portion of his security and to enable the debtor to make redemption to the prejudice of his creditor. This the statute does not contemplate. Its design is, as stated above, to prevent the sale of more of the land than is reasonably necessary to discharge the obligation of the debtor. Its effect, when thus construed, is to make it possible to protect both parties from unnecessary loss. * * * It was not, however, necessary to the preservation of the creditor's security that he offer a competitive bid upon each tract or parcel as offered. Appellant had a right to a sale en masse, unless the sale by parcels was for a sum sufficient to satisfy the execution. It was the duty of the sheriff, when the aggregate amount bid * * * was grossly less than the fair value of the security, to offer the land for sale as a whole. The sale of the land for $4,000 operated as a fraud upon appellant and also upon the judgment debtors. * * * The actual result, if the sale is permitted to stand, will be to satisfy only a fraction of the debt and leave the balance unpaid and to subject any property of the debtors to levy under a general execution therefor. The sheriff failed to perform his statutory duty, which was, when the amount bid for the land in parcels was grossly inadequate, to offer it for sale en masse and to sell it to the highest bidder. This duty was emphasized by the knowledge which he possessed that the appellant would bid $23,500 if the land was so offered."
It will thus be seen by the brief review of our prior decisions relating to the construction of these various statutes that the court has endeavored to construe them, not strictly according to the letter, but according to the spirit and equity of the situation revealed by the facts in each particular case. It seems to us, the object to be attained in requiring the officer to first sell the nonhomestead property is to ascertain the fact whether or not there is sufficient property *Page 1126
to liquidate the indebtedness and therefore render it unnecessary to disturb the sacred rights of homestead. That object was just as effectively accomplished by the sheriff in the case under consideration by the method used by him as if he had gone through the useless operation of striking off to the first bidder the nonhomestead forty at $2,000. In other words, he had demonstrated, by offering the nonhomestead forty and exhausting the bids therefor, that the highest bid which he was able to receive was the sum of $2,000, while the indebtedness was over $8,000. It was plainly apparent from this demonstration that there would be a deficiency of over $6,000, which would have to be made up by the sale of the homestead property. He then offered the homestead property separately and received a bid of $3,000. He thereby demonstrated that selling the eighty in separate tracts would leave a deficiency still of over $3,400. He then, in his wise discretion, acting in good faith, as we are bound to presume, undertook to ascertain what it would bring if offered enmasse, and, when so offered, he received a bid within a few dollars of the total amount of the entire indebtedness, or a sum of over $3,200 in excess of the aggregate amount of the bids when offered in separate tracts.
The sheriff, by pursuing the method followed in conducting the sale in this case, demonstrated another fact — that the farm was worth more sold en masse than in separate tracts, and our court has twice stated in effect that under such circumstances it is the duty of the sheriff to sell the farm in the way and manner that will bring the greater returns. In doing this, he is benefiting both the debtor and the creditor. To have sold the farm in separate tracts in the instant case would have resulted in leaving a deficiency judgment against the defendant of over $3,400, and would have, at the same time, deprived the plaintiff of an equal sum which he was entitled under his mortgage security to have applied upon the judgment debt. In pursuing the course followed by the sheriff in offering the farm in separate tracts before accepting any of the bids, he ascertained in advance of the striking off and selling of the farm the possibility of obtaining this additional money which went to the protection of both debtor and creditor, and, as stated heretofore in our holdings, the sheriff had some discretionary power and occupied a dual position of agency of both the plaintiff and the defendant, and, as an officer of the court and in the fair and impartial exercise *Page 1127
of his duties, pursued in good faith the course which produced the greatest beneficial results for both parties concerned.
We have heretofore held that the mortgagee was not compelled to place a competitive bid when the property covered by his mortgage was offered in separate tracts. He was entitled to have it solden masse after it had been demonstrated that the homestead property would be required in order to make up the deficiency, and after it had further been demonstrated that the farm when offered as a whole was 33 1/3 per cent more valuable than when offered in separate tracts.
The case of Sheakley v. Mechler, 199 Iowa 1390, 203 N.W. 929, 931, contains some statements which might, on first reading, appear to be in conflict with our holding in this case. This was a case of foreclosure of a mortgage and involved a contest over the appointment of a receiver to take possession of and collect the rents and profits from the homestead forty, and in this case the court, speaking through the late Chief Justice De Graff, said:
"The contract in the instant case was executed by the persons having the power to convey the homestead. The contract did expressly waive homestead rights, and stipulated for the appointment of a receiver `who shall take possession of the mortgaged premises and collect all rents and profits accruing therefrom.' But one question, therefore, calls for an answer: Had plaintiffs exhausted all other property pledged by the samecontract for the payment of the debt before resorting to the homestead to pay the deficiency on the judgment, if a deficiency existed? How may it be known that a deficiency did exist until a sale of the mortgaged premises on execution? The market value of the real estate cannot be viewed as conclusive, nor can it be made the criterion in determining whether a deficiency will remain.
"In brief, we hold that a receiver under a mortgage may not take possession of the homestead until sale on execution is had, as it cannot be determined until that time with that degree of certainty contemplated by the law that a deficiency exists. The homestead is a solicitude of the law, and this court recognizes the importance of the preservation of the home. The power to mortgage a homestead is qualified by statute, and a judicial sale of the homestead under stipulations in a mortgage is to be enforced for the benefit of the mortgagee as a last resort only." *Page 1128
This language was quoted with approval in Finken v. Schram,212 Iowa 406, at page 413, 236 N.W. 408, in the opinion by Justice Kindig. This case was also a foreclosure of a mortgage and a contest over the appointment of a receiver for the purpose of collecting the rents and profits from the real estate during the year of redemption and involved the question of homestead.
In each of the cited cases last referred to, the question under consideration was how it could be determined that a deficiency would exist after exhausting the other property of the judgment debtor, thereby rendering it necessary to resort to the rents and profits from the land pledged as security. For many years it was the practice to arrive at the value of the mortgage security by oral testimony which the courts recognized as a very unsatisfactory method, owing to the fact of the wide discrepancy of witnesses as to value, and the method finally laid down by our court as the most satisfactory was to first offer the property for sale at execution sale and in this manner ascertain the value of the mortgage security and determine whether or not the security was adequate or whether a deficiency would exist after exhausting the real estate covered by the mortgage, and this method has been quite generally followed and is considered the better practice.
In the Mechler case and in the Schram case above referred to we have adopted this as the only method of ascertaining the value of the security, and have said that, before a receiver can take possession of the homestead, it must be first determined on execution sale that there will be a deficiency after exhausting all other property, and that there is no other way to determine that question with the degree of certainty contemplated by the law that a deficiency exists. When these cases are read in the light of the purpose for which the language was used, our holding in this case is not in conflict with the reasoning set forth in the Mechler case.
The statutes as to the sale of a homestead must be interpreted in the light of the purpose and intent of the legislature in enacting such laws. We said in an early case:
"The great object in regulating judicial sales, is to make the property bring the greatest amount. This is desirable for both parties." Boyd v. Ellis, 11 Iowa 97, at page 104. *Page 1129
And in the recent case of Arnold v. Murphy, 199 Iowa 934, at page 939, 203 N.W. 387, 390, the court, speaking through Justice Albert, said:
"It is obvious that the real purpose in passing these various statutes, as to the sale of homesteads, was to protect the holder of the homestead against a sacrifice of his property. It is, therefore, provided that in a sale the homestead shall be offered last, and also that if the owner himself does not plat the homestead that the sheriff shall plat it. The very purpose of these requirements is within line of the intent of the legislature to protect the homestead as far as possible, so that it will not be sold unless necessary to the payment of debts for which it is pledged, or is made liable under the statute."
A reading of all our cases will demonstrate conclusively that it has uniformly been the holding of this court in interpreting statutes of this character that the intent and purpose underlying the rule requiring sale by parcels are (1) that no more be sold than necessary to satisfy the debt and (2) to stimulate strife or competition in bidding, and not that the owner may be thus placed in a more advantageous position in making redemption.
If we affirm the holding of the lower court, the result must necessarily follow that in every case where a homestead is involved the mortgagee would be required to place competitive bids when the property was offered in parcels in order to protect his mortgage lien, regardless of the fact that the property when sold as a whole as contained in his mortgage would be of much greater value. It certainly was not within the contemplation of the lawmakers to thus lay down a rule which will permit the debtor to redeem a portion of the security to the prejudice of his creditor. As said in the King case, "This the statute does not contemplate." In the case at bar a deficiency judgment of $177.52 still remained after exhausting all the property, and we have held that under such circumstances, where the mortgage contains a receivership clause, in addition to the real estate, the rents and profits from the homestead itself are liable for the deficiency. Finken v. Schram and Sheakley v. Mechler, supra.
What we hold is that the fact that it was necessary to resort to the sale of the homestead property is ascertained just as effectively when the bids are exhausted, as was done in the case at bar, *Page 1130
as though the bid had been accepted and the property struck off to the bidder, and that the property other than the homestead was thus exhausted in the meaning and the use of the term in section 10155 of the Code, and in the contemplation of law as applied to this statute all other property had been exhausted when, on execution sale, the other property had been offered at sheriff's sale and the bid received was not sufficient to pay the mortgage debt, and that, the sheriff having followed the course which resulted in his receiving an amount for the creditor in excess of the amount which he would have received if the land had been sold in separate tracts, and likewise resulting in an increase in benefits, both to the debtor and creditor, a court of equity should not interfere with the sale.
This is the method which has been followed in so many instances in the sale of property under special execution in mortgage foreclosures in this state in recent years that any other rule would unnecessarily disturb vested property rights and lead to endless litigation over titles to real estate. To the end, therefore, that this matter may be definitely settled in this state, it is the holding of this court that the proper procedure to be followed in the sale of real estate under special execution in the foreclosure of mortgages covering real estate, which includes a homestead, should be that the property other than the homestead shall first be offered in tracts of forty acres or less, and, if no bids are received, or if the bids received when so offered in the aggregate are insufficient to pay the mortgage debt, interest and costs, the entire tract other than the homestead shall then be offered en masse, and when so offered, if no bid is received, or if the bid received is insufficient to satisfy the total amount of the debt, interest, and costs, then the homestead tract shall be offered separately, and, if the aggregate of the bids received for the property other than the homestead and the homestead property, when thus offered separately, is equal to, or greater than, the full amount of the judgment debt, interest and costs, the property other than the homestead and the homestead property shall be sold separately, but, if said aggregate of bids, when offered separately, is not equal to or greater than the total amount of the debt, interest and costs, then the entire property shall be offered en masse,
and, if it is thus ascertained that a greater amount can be realized for said mortgaged premises when so offered as a whole, then the entire tract, including the homestead, shall be sold enmasse. *Page 1131
From the conclusion we have reached, it necessarily follows that the action of the lower court in sustaining the defendant's motion to set aside the sale was erroneous, and a reversal follows. — Reversed.
All the Justices concur, except KINTZINGER, J.
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I find myself unable to agree with the foregoing opinion, for the following reasons:
This is an action to foreclose a real estate mortgage upon an eighty-acre farm, forty acres of which constituted defendants' homestead. A decree of foreclosure was duly entered and a special execution issued thereon. Prior to the date of the sheriff's sale, the defendant served notice on the sheriff, demanding that the nonhomestead forty be sold first. At the sale, the sheriff received a bona fide bid of $2,000 for the nonexempt land, but refused to sell it separately. He then offered the homestead forty, and received a bid of about $3,000 therefor, and also refused that. He then offered both forties together and received a lump sum bid of $8,222.85 therefor from the plaintiff. This being more than the aggregate of the separate bids, he sold the entire eighty to the Prudential Insurance Company for that amount. The bid of $2,000 for the nonhomestead forty was made by a person who was ready, able, and willing to pay cash therefor.
The sheriff's return showed the foregoing facts. Thereupon defendants filed a motion to set aside the sheriff's sale on the ground that forty acres of the mortgaged premises constituted defendants' homestead and should have been sold separately, and then only to satisfy a deficiency remaining after exhausting a nonhomestead property. The lower court sustained defendants' motion, and plaintiff appeals.
The sole question raised is the right to sell the homestead forty before selling the other forty included in the mortgage. Section 10150 of the Code provides that:
"The homestead of every family, whether owned by the husband or wife, is exempt from judicial sale, where there is no special declaration of statute to the contrary * * *."
The statutory declaration to the contrary is contained in section 10155 of the Code, which provides that: *Page 1132
"The homestead may be sold to satisfy debts * * * created by written contract by persons having the power to convey, expressly stipulating that it shall be liable, but then only for adeficiency remaining after exhausting all other property pledged
by the same contract for the payment of the debt." (Italics ours.)
The debt created by the mortgage in question comes within the terms of section 10155. The property pledged by the mortgage is an eighty-acre farm, forty acres of which constitute defendants' homestead. Under the provisions of the two sections referred to, the homestead cannot be sold except "for a deficiency remaining after exhausting all other property pledged."
Many cases are cited by appellant to sustain its contention that the homestead forty can be sold with the nonhomestead forty, if the aggregate of the bids for each forty separately is less than the bid received for both en masse. The cases cited, however, relate only to sales where no bids whatever werereceived for the nonhomestead property when offered separately. The following cases are cited in support of the majority opinion: Burmeister v. Dewey, 27 Iowa 468; Conn. Mut. Life Ins. Co. v. Brown, 81 Iowa 42, 46 N.W. 749; Glenn v. Miller, 186 Iowa 1187, 173 N.W. 135; State Bank v. Brown, 128 Iowa 665, 105 N.W. 49; Security Sav. Bank. v. King, 198 Iowa 1151, 199 N.W. 166; Boyd v. Ellis, 11 Iowa 97; Sheakley v. Mechler, 199 Iowa 1390, loc. cit. 1395, 203 N.W. 929; Finken v. Schram, 212 Iowa 406, 236 N.W. 408, and Arnold v. Murphy, 199 Iowa 934, 203 N.W. 387. An examination of these cases, however, shows they do not support the rule contended for, but simply hold that, where the homestead is pledged with other property, and no bids are received for the other property when first offered separately, then the other property may be combined with the homestead and sold together, on the theory that, where no bids are received on the nonhomestead property, when first offered separately, it will be considered "exhausted", and can then be sold with the homestead en masse. An examination of all of these cases will show that not one of them supports the rule that exempt and nonexempt property can be sold en masse, where a reasonably adequate bid has first been receivedfor the nonexempt property when separately offered for sale.
Only two of all the cases cited permit the sale of the homestead and nonhomestead property en masse, but the ruling therein was based upon the fact that no bids whatever were received upon the nonhomestead property when first offered separately for sale. The *Page 1133
rule permitting the sale en masse in those cases was based upon the assumption that the nonhomestead property was considered exhausted because no bids were received therefor when first offered separately. The only cases cited as supporting this rule are Burmeister v. Dewey, supra; Conn. Mutual Life Ins. Co. v. Brown, supra.
In Glenn v. Miller, supra; State Bank v. Brown, supra; Security Sav. Bank v. King, supra; Boyd v. Ellis, supra, the question of restricting the sale of a homestead to a deficiency remaining, after all other property was exhausted, is not involved. They are simply authority for the rule that property may be sold en masse without first offering it in separate tracts, and the question of selling homestead property was not involved.
The remaining cases cited do not support the majority opinion, but, on the contrary, support the rule that homestead property cannot be sold until all other property included in the mortgage has first been disposed of. Sheakley v. Mechler, 199 Iowa 1390, loc. cit. 1395, 203 N.W. 929; Finken v. Schram, 212 Iowa 406, 408, 236 N.W. 408, and Arnold v. Murphy, 199 Iowa 934, 203 N.W. 387.
In the instant case, however, the nonexempt property included in the mortgage had not been exhausted. That forty was unimproved and was first offered separately. A bona fide bid of $2,000, or $50 an acre, was offered therefor and refused. It is not claimed that the amount offered for the nonhomestead forty was inadequate and should therefore have been sold en masse with the homestead.
The statute provides that the homestead forty cannot be soldexcept for a deficiency remaining after exhausting the otherforty included in the mortgage. Did the sheriff exhaust all other property pledged before resorting to a sale of the homestead to satisfy the deficiency? It will not do to say that he exhausted such other property, when he failed to sell it after receiving a substantial bid therefor. How can it be known that a deficiency exists until after a sale of the nonhomestead property is first made? It is impossible to determine the amount of the "deficiency" until the nonexempt forty is first sold, as "it cannot be determined until that time with that degree of certainty contemplated by the law that a deficiency exists. The homestead is a solicitude of the law, and this court recognizes the importance of the preservation of the home. * * * A judicial sale of the homestead under stipulations in a mortgage is to be *Page 1134
enforced for the benefit of the mortgagee as a last resort only." Sheakley v. Mechler, supra, loc, cit. 1395. Under the facts in this case, it was the duty of the sheriff, under the law, to sell the nonhomestead forty first, if he received a substantial bid therefor. The homestead could then be sold only to satisfy a deficiency remaining. Any other construction of the statute would render it meaningless. Without this statute, the homestead could not be sold; with the statute, it can be sold only after all other property pledged has been "exhausted".
It is the settled law of this state that, where a portion of the land mortgaged is the homestead, it cannot, under the law, be sold except to supply the deficiency remaining after a sale of the nonexempt property included in the mortgage. Such is the construction given the statute by the following cases, and we are controlled thereby: Lay v. Gibbons, 14 Iowa 377, 81 Am. Dec. 487; Twogood v. Stephens, 19 Iowa 405; Equitable Life Ins. Co. v. Gleason, 62 Iowa 277, 17 N.W. 524; Walther v. Walther, 161 Iowa 560, 143 N.W. 503; Haynes v. Rolstin, 164 Iowa 180, 145 N.W. 336, 52 L.R.A. (N.S.) 540; Kilmer v. Gallaher, 107 Iowa 676, 78 N.W. 685; Moody Son v. Century Sav. Bank, 239 U.S. 374, 36 S. Ct. 111, 60 L. Ed. 336; Lambert v. Powers, 36 Iowa 18; Bankers Life Assn. v. Engelson, 148 Iowa 594, 126 N.W. 951; Owens v. Hart,62 Iowa 620, 17 N.W. 898; White v. Rowley, 46 Iowa 680. These cases support the declaration of the statute providing that the homestead cannot be sold except "only for a deficiency remaining after exhausting all other property pledged." Section 10155.
In Twogood v. Stevens, supra, loc. cit. 412, this court said:
" * * * It is the policy of the law, not to allow a homestead to be levied upon and sold, even if otherwise liable, until all other property of the defendant in execution, is first exhausted; that this homestead right is equal, if not superior in dignity to any other legal or vested right, and should not be disturbed, short of a fair sale to the highest bidder, of all the other property."
In Haynes v. Rolstin, supra, loc. cit. 183, this court said:
"The real property involved in the present proceeding was, * * * in part occupied as a homestead. * * * had the mortgagee sought foreclosure during the lifetime of M.D. Haynes, the latter, with his wife, had the right to insist that the property outside the *Page 1135
homestead should first be exhausted. Code section 2979. Twogood v. Stephens, 19 Iowa 405; * * *"
The legislature had a right to prohibit the sale of the homestead if it so desired. In fact, in the absence of section 10155, the homestead would have been absolutely exempt under section 10150. It is obvious that the object to be attained by section 10155 was to permit the owner to save his homestead without being compelled to redeem from a sale of the entire property. It is not for us to say whether this statute is wise or unwise. All we have to do is to construe it. This statute is plain and unambiguous, and the legislative intent should be carried out by the courts. This construction is supported, rather than contradicted, by Sheakley v. Mechler, supra, loc. cit. 1395, cited by appellant. In that case this court said:
"The real question at issue involves the right of occupancy of a homestead by the mortgagor during the year of redemption. May he pledge this right as security for a debt? If not, why not? Section 10150 of the Code, 1924, provides that: `The homestead of every family * * * is exempt from judicial sale, where there is no special declaration of statute to the contrary.' Clearly a sale under foreclosure is a statutory judicial sale. What is the special declaration of our statute which removes the homestead from the defined exemption? It is: `The homestead may be sold to satisfy debts * * * created by written contract by persons having the power to convey, expressly stipulating that it shall be liable, but then only for a deficiency remaining after exhausting all other property pledged by the same contract for the payment of the debt.' Section 10155, paragraph 2, Code 1924. The contract in the instant case was executed by the persons having the power to convey the homestead. The contract did expressly waive homestead rights, and stipulated for the appointment of a receiver `who shall take possession of the mortgaged premises and collect all rents and profits accruing therefrom.' But one question, therefore, calls for an answer: Had plaintiffsexhausted all other property pledged by the same contract for thepayment of the debt, before resorting to the homestead to pay the deficiency on the judgment, if a deficiency existed? How may itbe known that a deficiency did exist until a sale of themortgaged premises on execution? [Italics ours.] * * * The homestead is a solicitude of the law, and this court recognizes the importance of the preservation of the home. The power to mortgage *Page 1136
a homestead is qualified by statute, and a judicial sale of the homestead under stipulations in a mortgage is to be enforced for the benefit of the mortgagee as a last resort only."
This rule is also supported by Finken v. Schram, 212 Iowa 406, 236 N.W. 408, and, Arnold v. Murphy, 199 Iowa 934, 203 N.W. 387.
The lower court held that the homestead property involved in the instant case should not have been sold except for the deficiency remaining after a sale of the nonhomestead forty, a reasonable offer having been received therefor. I think the judgment of the lower court was right, and should be affirmed.
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[1] Plaintiff in his petition prayed judgment against the defendant for $15,000. Defendant, in answer to the petition, admitted that plaintiff was injured while riding in defendant's automobile as the latter's guest but denied that any injuries received by plaintiff were caused by any recklessness in defendant's operation of the automobile. The answer also alleged assumption of the risk of riding in the automobile on said highway. Under the instructions of the court the maximum verdict recoverable by plaintiff was $12,587.95. The maximum recovery on each item of damage was $292.95 for hospital and medical expenditures, $880 for earnings lost, $5,000 for past pain and suffering, and $6,415 for disability and loss of earnings in the future. The legs of plaintiff were broken below the knees. The verdict of the jury and judgment thereon was for $1,200. Defendant's motions for a directed verdict and for judgment notwithstanding the verdict, based upon the ground that the evidence did not establish recklessness on the part of defendant, and upon the ground that plaintiff knew the road and weather conditions and assumed the risks incident to the operation of the automobile, were overruled.
Appellant's assignments of error were bottomed upon the rulings on these motions, and upon the fourteenth instruction.
I. Automobile guest cases, under section 5037.10, Code of 1939, have been before this court many times since its enactment in 1927. The provisions of the statute and the controlling principles of law as repeatedly stated by this court are well known. The difficulty lies in the application of those principles to the varying facts in each case. Because the cases differ in facts, there is no profit in the dissection of precedents.
The injury occurred on Sunday, March 5, 1944. About three o'clock in the afternoon plaintiff, fifty years old, and Mr. Salisbury, a friend of many years, went to the Union Club in downtown Sioux City. The defendant, whom the plaintiff had met a few times during the previous year, was there and *Page 614
was introduced to Salisbury. They had a couple rounds of beer and a drink of liquor each from a half-pint bottle of Salisbury's. Upon learning that defendant was going to drive to Denison, Salisbury proposed to him that he take his juke box in the car to Denison, as he had no place to keep it. Defendant finally agreed to take it if it could be carried in his Tudor Chevrolet. The car was parked just outside the club and they drove about a block along the street to the place where the instrument was and loaded it into the car. The back of the right half of the front seat was leaned forward and the base of the juke box was placed against the floor and back seat and the rest of the instrument extended forward on the reclining back of the front seat. It occupied the entire right side of the car. Defendant drove the car and plaintiff sat just behind him in the rear seat and Salisbury was seated to his right and against the juke box. They were quite crowded in the back seat.
Snow began falling before noon and when they started the precipitation was about half snow and half rain. There was from an inch to several inches of slush on the streets. There were a few small spots of ice under the slush. These were the weather and road conditions throughout the afternoon, and were, of course, apparent to each of them, except that the spots of ice were not noticeable. Defendant drove the car from downtown out through East Morningside to the end of the streetcar line and entered State Highway 141, a paved road leading to Denison, about seventy-five miles to the southeast. It was shortly before four p.m. when they started. The injury occurred about five p.m., or a little before, about ten or twelve miles from the business section of Sioux City. Everything proceeded well as they drove through the city and beyond Morningside until within five or six miles of the place of injury. The highway is somewhat winding and proceeds through a slightly rolling country. There are a number of rather sharp curves in the road. The plaintiff and Salisbury testified for plaintiff respecting the trip. Plaintiff testified:
"So we got in the car and moved down on Fourth Street and went down till we hit 141; and when we went up there *Page 615
everything was going along pretty good till we got to the main highway, and then is when he got to driving pretty fast and I was afraid, anyway, and I couldn't stand it any more, and I asked him to slow down, asked him if he wasn't driving too fast that way on this highway that was slushy; and he went on * * * and he didn't pay any attention; so I asked him again — I was getting a little scared; and a couple of times he drove up on the shoulder of the pavement, and when he came off it again the car began to sway; and I was getting pretty scared; so it went on for a while and he wouldn't slow down; and he said he didn't want to be all night going down to Denison and back; and he was traveling pretty fast and he got up on the shoulder, and it was then he got to swaying and it never did come off and we hit the bridge then. It was around 4:30. The street was awful slippery, slushy and winterish, there was no snow on the pavement, it was icy. I should say Hodges was going around thirty miles, as near as I could guess. * * * There are quite a few curves in this road after you get out a ways. It looked to me like the car was out of control as he couldn't get it under control after it started swaying after he got off the shoulder. * * * when it was swaying just before it went into the bridge, why it was out of control then, and the rear end of the car swung in and hit the left abutment of the bridge, and that was the side I was sitting on, and it bounded from that side over to the other side and hit the other side and it stopped there. I imagine that I called his attention to the way and manner in which he was driving not less than three times. He didn't heed my desire."
The first time he told defendant to drive more slowly was about four or five miles out of Morningside and about the same distance from the place of the accident. The second time that he told the defendant he was scared and to not drive so fast was about a mile or two miles from the place of the injury. And, just before the accident:
"I just asked him if he wouldn't please slow down, that I was getting scared. * * * the pavement is too slippery for the speed you are going." *Page 616
Answering a question as to whether the car was out of control at any time before it struck the bridge, the plaintiff testified:
"Not clear out, but it swayed; and then he got up on the shoulder a few times, and he seemed to have a heck of a time getting it in control again, but he always did till — probably a hundred feet from the bridge, the car skidded or twisted around and struck the bridge and I would figure he was driving around thirty miles."
On cross-examination he testified:
"I don't think he was driving quite as fast as thirty miles the first few miles after we left Morningside but just as soon as we got away from the street car line out of Morningside he started driving that fast. I hadn't said anything to him in Morningside about driving too fast. * * * Q. Did it slip any place from Morningside down to just before you got to the place of the accident? A. Well, it never got off the pavement, but the back end of the car would skid once in a while. * * * It slipped several times before we got to the place of the accident. * * * The first place was four or five miles this side of the accident."
The record fairly shows that, when he testified that the car went up on the shoulder, he did not mean the dirt shoulder, but meant the curved cement shoulder constructed to carry the water off.
Salisbury testified:
"It was snowing and rain, or snow and rain together and it was awful wet. The paving on 141 was wet and slippery in places where the cars hadn't worn off the snow and slush as they went along. There was a little ice in spots. It was more like rain and snow together, big flakes that were awful wet. * * * I should judge — he was driving carefully here in town, but after we passed Morningside he stepped on it a little bit. I should judge, around thirty * * * maybe a little more. * * * Q. Did you observe his mode of driving or traveling down 141? A. The only thing I could see, it would be more of a skid *Page 617
there. There was quite wet stuff, and when he was going fast when he would hit one of those wet spots or a little ice or something I guess Mr. Olson made a little remark there to him about not going so fast. * * * He didn't seem to pay any attention to him. He just kept right on going. * * * I think the car skidded three or four times before we hit that bridge there where it skidded into the bridge. * * * I told him to slow down a little bit * * * and Mr. Olson said, `Slow down, I'm getting scared.' * * * Well, he didn't pay any attention to us whatsoever. It just seemed like he bowed his neck and just went ahead and drove. * * * The last time the car skidded, when it hit the bridge, it was about seventy or eighty feet, or something like that, from the bridge and had gotten up on the shoulder. It kind of skidded one way and he tried to get it back, but it hit the shoulder on the paving and then hit this mud and he tried to get it back and then it hit the bridge."
On cross-examination, Salisbury testified:
"Well, some of it would melt and some wouldn't; as the cars drove along there it melted, because it was more of a rain and snow together; more rain and snow, slush and sleet. There wasn't much of anything that stayed on the pavement. The first time we slid was just after we left Morningside Avenue. * * * it was on a flat stretch and it skidded some. I imagine he was going about twenty-five miles an hour then * * * it buckled back and forth a couple of times and then he got control of it again. It didn't skid as much as half way across the pavement or go over the edge of the pavement. * * * Q. And it would be on its own side of the pavement? A. Yes. He had to get it back, because there was another car coming. Q. The car, as it was driving at that time on that trip, when it skidded and slid the first time and the second time and the third time, if it did, that you have mentioned, before the accident, it always remained on its own side of the paved road, did it? A. Outside of the time we had the wreck — well, there was once that it pretty near turned around in the middle of the road about that second skid there, but he got *Page 618
control of it and got it back to the road. But when he hit this bridge there was no chance of getting it back on its own side of the road because he was clear on the wrong side of it. Q. When hehit the mud, that was this dirt — that was dirt which crossed it from another road, a dirt road; is that right? A. Yes. Q. You didn't know that mud was there till you got on it, did you? A. No, I didn't. Q. And he didn't know there was any mud there? A. No. * * * The pavement runs straight there for two or three miles before you get to the bridge. Before he hit the bridge he was not in the center of that paved portion of the road; he was on his own side of the road until the car started skidding and then he got over a little too far. * * * But at no time was it off the pavement. It wasn't off the pavement when it skidded. Q. The skidding was on the pavement when it crossed that mud that was carried on there by the wagons or automobiles from the mud road? A. Yes, sir. Q. There was no time when this car skidded or slipped that it got off the paved road? A. No. Q. In those one, two, three or four times? A. No, it didn't get off the road, only skidded. Q. I said, off the paved road. A. No, sir, it didn't, no, sir. Q. And you say that the speed was, one place, twenty-five miles an hour, that you mentioned? A. Yes, that was right after we left the city limits — was while we were still going onto Highway 141 there. I imagine that was about how fast he was going. I wouldn't swear whether he drove up thirty miles all of the time, when he came to curves he slowed down a little bit, and when he would get a good stretch he would go faster. He was driving twenty-five miles an hour when we got out of Morningside, and then when we got out of the city limits the rest of the way he was driving about thirty miles an hour and he slowed down where there were some curves or anything like that. * * * from where this mud was, where it hit, that, I would judge was about thirty feet across from there and came onto the bridge."
The above-stated excerpts of testimony present a sufficiently complete statement of the record in the aspect most favorable to the plaintiff. Only the defendant testified in his behalf. His version of what took place is, briefly, as follows: *Page 619
"After we left Morningside and entered on 141 it was still snowing and it was slippery. The snow at that time was melting about as fast as it fell; it made the pavement wet. There wasn't any ice as it was melting and there couldn't have been ice. We did not run into any spots of ice before we came to the place of the accident and there wasn't any spot of ice where the accident occurred. There was some snow, and the road was slushy with a thin layer of slush on the pavement. * * * For the last sixty rods to the bridge it was slightly downgrade. * * * there wasn't any ice in that sixty rods or where the accident occurred. There is no intersection where I hit the mud on the road at the time of the accident, it is a lane from the farmer's yard leading up to the pavement on the right-hand side of the pavement. It isn't a public highway, it is a lane, and the buildings on that lane I imagine are about twenty rods from the pavement. * * * the lane does not go across the pavement. * * * I did not know there was any mud on the pavement before I got to that spot or near it, where this road lane came in. I was traveling about twenty-five or thirty miles an hour on this trip and I was probably going about twenty-five miles an hour before I got to where this accident occurred. I was never on the wrong side of the paved highway nor did my car get over the center line on that trip. I was on my own side at all times. I struck this mud and the car skidded and slid sideways for a ways and started to go over the bank [of the creek] on the left-hand side of the road; and I managed to get it back in the center of the road again; then the rear of the car swung around and hit this bridge. * * * It didn't get off the pavement at all. I did all I could to stop the car or control it after it was sliding; I just tried to hold the car onto the pavement * * * to avoid going into this creek. I put the brake on after the car started to slide * * * but the car was sliding so the brakes wouldn't have anything to do with it * * * Mr. Olson didn't say a word to me about my driving on that trip and he never made any objection to the speed at which I was driving. He never made any objection at any time on that trip, and neither did Mr. Salisbury. They *Page 620
never made any statement to me about the car slipping and before we got to the place where it did slide at any time on that trip. I have talked with both of them after this collision."
As a part of plaintiff's cross-examination, defendant introduced a statement signed by plaintiff on March 14, 1944 — nine days after the accident. In part, it is as follows:
"It is my understanding Hodges was going to Denison. My buddy, Clarence Salisbury, asked me to go along. He told me he would make it worth my while if I would go along to help lift a small piano out of the car. They made arrangements for the trip between themselves but in my presence.
"At any rate we started for Denison. Just before the accident occurred the car started to skid, the back end started to slide around, and before Hodges could get the car under control it had skidded into a bridge bannister.
"It was about five P.M. It was snowing a little. I had not noticed the pavement being slick. Hodges was a good, careful driver. He had not been driving fast or carelessly. He was only going twenty-seven or twenty-eight miles per hour when the accident happened. It happened right in front of some farm buildings and a drive into this place. There had been some dirt pulled out on the pavement, which caused the car to start skidding.
"We were all sober, we had only a couple of beers. Neither of us were intoxicated in any way. * * *
"Have you read this statement? Yes. Is it true? Yes."
Appellee's explanation of the statements in this writing, which are contrary to his testimony, was that a stranger, who he supposed was an adjuster, interviewed him at the hospital, but he did not remember what he told him, and he did not read the statement which the man wrote, and it was not read to him, and he was in great pain and had been taking considerable opiates during that first month.
Accepting the testimony of appellee and Salisbury most favorable to appellee, and all favorable inferences deducible therefrom, as true, and disregarding all adverse statements of *Page 621
appellee in his signed statement, and all portions of appellant's testimony which are unfavorable to appellee, it is, nevertheless, our firm conviction that all reasonable minds must agree that the record does not establish that there was "reckless operation" of the car within the intendment of the guest statute and this court's repeated definitions of the term.
There is no issue of intoxication in the case. The issue before us is whether the record, viewed as favorably for appellee as it is reasonably possible, sustains the submission to the jury of the issue of appellant's reckless operation of the car. Was there sufficient evidence to establish a prima facie case of "recklessness"? Welch v. Minkel, 215 Iowa 848, 853, 246 N.W. 775. The answer must be reached by consideration of the evidence, the statute, and our decisions construing it. The "guest statute" (section 5037.10, Code, 1939) was enacted for the specific purpose of relieving the driver of a motor vehicle from any liability for injuries received by his guest as the result of the driver's negligence. Redfern v. Redfern, 212 Iowa 454, 457,236 N.W. 399; Siesseger v. Puth, 213 Iowa 164, 169, 170, 239 N.W. 46; Neessen v. Armstrong, 213 Iowa 378, 384, 239 N.W. 56; Wright v. What Cheer Clay Prod. Co., 221 Iowa 1292, 1293, 267 N.W. 92. Under that statute the driver is liable for injuries to the "person riding in said motor vehicle as a guest or by invitation and not for hire," only when they are caused by the intoxication of the driver or by his "reckless operation" of the vehicle. In the Siesseger case, supra, 213 Iowa 164, 182, 239 N.W. 46, 54, the court defined the term "reckless operation" of a motor vehicle, keeping in mind the purpose of the legislature in enacting the statute. In its subsequent decisions the court has not departed from that definition but rather it has fortified and emphasized it for the protection of the driver. Under our decisions reckless operation of a motor vehicle is not inadvertence, momentary thoughtlessness, error in judgment, careless conduct, or negligence. Neither is it a degree of negligence. Shenkle v. Mains, 216 Iowa 1324, 1328, 247 N.W. 635. "* * * even though negligence be great, it is still negligence." Levinson v. Hagerman, 214 Iowa 1296, 1300, 244 N.W. 307, 309; *Page 622
Phillips v. Briggs, 215 Iowa 461, 464, 465, 245 N.W. 720. It is something more than negligence. "* * * recklessness means something entirely distinct from and beyond negligence." Brown v. Martin, 216 Iowa 1272, 1277, 248 N.W. 368, 370. It is negligence "plus other elements which raise it to the dignity of recklessness." Stanbery v. Johnson, 218 Iowa 160, 165,254 N.W. 303, 306. In the contemplation of the statute "reckless" means "proceeding without heed of or concern for consequences"; it implies "no care, coupled with disregard for consequences." Siesseger v. Puth, supra, 213 Iowa 164, 182, 239 N.W. 46, 54, and numerous decisions citing that case. "To constitute recklessness under the guest statute, conduct must be more than negligent and must manifest a heedless disregard for or indifference to the consequences or the rights or safety of others." Harvey v. Clark,232 Iowa 729, 732, 6 N.W.2d 144, 145, 143 A.L.R. 1141. In Petersen v. Detwiller, 218 Iowa 418, 421, 255 N.W. 529, 530, the term "utter disregard to the consequences" is used. In Levinson v. Hagerman, supra, 214 Iowa 1296, 1299, 244 N.W. 307, and in Wion v. Hayes, 220 Iowa 156, 164, 261 N.W. 531, the language is"utter indifference to the safety of the guest." (Italics ours in each quotation.) In Wright v. What Cheer Clay Prod. Co., supra,221 Iowa 1292, 1302, 267 N.W. 92, 97, the court said: "In order to be reckless * * * the driver must have had knowledge of the hazard or peril, or in the exercise of reasonable and ordinarycare * * * should have acquired such knowledge, and appreciated that hazard and danger existed, but acted in entire disregard of the existing danger, and proceeded without heed of or concern for consequences without any care whatever * * *." (Italics ours.)
As said in Shenkle v. Mains, supra, 216 Iowa 1324, 1328,247 N.W. 635, 636:
"The statute calls imperatively upon us to recognize a substantial distinction between negligence and reckless operation. * * * Having laid down in the Siesseger case [213 Iowa 164,239 N.W. 46] the line of demarcation to the best of our ability, our remaining duty for the future is to apply the rule *Page 623
without vacillation to the concrete facts of the particular case. Such has been our course in the cases here above cited. The two grounds upon which recovery may be predicated under section 5026-b1 [section 5037.10, 1939 Code] are exceptional and not general. The general rule is that a guest cannot recover. The exceptional grounds are: (1) `intoxication' of the driver, (2) `reckless operation' by the driver. The exceptional character of these grounds implies an infrequency of application thereof. To use and apply the exceptions as the general rule, and in effect to supplant the general rule with the constant use of the exceptions, is to drive against a red light. If the application of the exceptions becomes more frequent than that of the general rule, it may well be deemed a warning sign that we are misapplying the exceptions."
Applying the rule of these decisions to the facts in this case convinces us that the appellee failed to bring himself within the second exception of the statute. While testimony for appellee contains language which, standing by itself, and on its face alone, might seem to support his contention of reckless operation — "driving pretty fast," "driving too fast." "he wouldn't slow down," "he didn't heed my desire." "nor show any inclination, concern, desire or any intention to heed what I said," "he bowed his neck," "the car was out of control," "he stepped on it" — these statements must be considered in the light of other facts shown by testimony introduced by the appellee. These facts are, in a distance of five or six miles the car slipped and swerved three or four times but until it reached the mud and silt, it never passed over the center line or off the pavement; it was only momentarily out of control and was soon brought into control; it was always on the right half of the pavement; the speed never exceeded thirty miles an hour; he drove from twenty-five to thirty miles an hour and "slowed down where there were some curves or anything like that"; the approach to the bridge was straight and upgrade for almost all the way for the last two or three miles and slightly downgrade for the last sixty rods; there was no car approaching from ahead; the appellant had no knowledge of the mud and silt which had *Page 624
been carried onto the pavement by traffic from the private driveway; it was concealed by the slush; it clearly appears from testimony for appellee that it was the slippery mud and silt which caused the car to strike the abutment of the bridge.
Certainly there was nothing in the appellant's operation of the car which indicated he was "proceeding without heed of or concern for consequences," "with no care," "with utter indifference to the safety of his guest, and entire disregard of existing and apparent danger." Driving at a speed of twenty-five miles an hour and slowing down for curves or other interference, and then going a little faster, maybe thirty miles per hour or a little more, on a "good stretch," is not operating a car in daylight on a country road with "no care," "utter indifference to safety," and "in heedless and entire disregard for consequences." It is about the way the ordinarily careful motorist would operate his car under like conditions.
Of course, weather and road conditions may make travel on the highways impossible, or too hazardous to attempt, but that was not the situation on this Sunday afternoon. Other motorists were on the highway. A very great many persons have operated or ridden in motor vehicles when snow, ice, slush, and mud made travel more difficult and hazardous than when the highways were dry. And they will continue to do so. Much of this travel is necessary or cannot be avoided. In such travel greater care and watchfulness and more expert operation of the mechanism of the car are required, but one driving under such conditions is not reckless in traveling, nor is he reckless if the car may slip or swerve or skid because he misjudges the condition of the road at some place, or he, by intention or inadvertence, applies the brakes too forcibly or abruptly or feeds the gas somewhat too freely. Such errors may be negligence but they do not constitute reckless operation. An important factor in determining whether there was reckless operation of a motor vehicle is the fact that the driver either knew and appreciated the existing dangers, or the conditions and circumstances were such or were so obvious that he should have known and been conscious of the dangers. Proof of either is *Page 625
sufficient. It is the heedless disregard of these known or apparent dangers that constitutes recklessness. Appellant knew of the road conditions but it cannot be said, under the record, that he was utterly heedless of or indifferent to them. If the facts in this case are to be the pattern or measure of reckless operation of a motor vehicle when there is snow, slush, ice, or mud on the highways, then the guest statute will afford little protection to the motorist using such highways. It is our conclusion that all reasonable minds must agree that the appellant was not reckless in the operation of his car as alleged by appellee.
Decisions other than those already cited which sustain our conclusion are: Popham v. Case, 223 Iowa 52, 271 N.W. 226; Bowermaster v. Universal Producing Co., 221 Iowa 831, 834, 835,226 N.W. 503; Petersen v. Detwiller, supra, 218 Iowa 418, 419,255 N.W. 529 (in the three cases just cited, mud or silt on the highway was a factor in causing the accident); Wilson v. Oxborrow, 220 Iowa 1135, 1141, 1142, 264 N.W. 1; Koch v. Roehrig,215 Iowa 43, 46, 244 N.W. 677; Paulson v. Hanson, 226 Iowa 858,862, 863, 285 N.W. 189; Tomasek v. Lynch, 233 Iowa 662, 669-671,10 N.W.2d 3; Long v. Pearce, 233 Iowa 1025, 10 N.W.2d 50; Roberts v. Koons, 230 Iowa 92, 97, 98, 296 N.W. 811; Mayer v. Sheetz, 223 Iowa 582, 584-588, 273 N.W. 138; Thuente v. Hart Motors, 234 Iowa 1294, 15 N.W.2d 622. In the recent case of Russell v. Turner, D.C., Iowa, 56 F. Supp. 455, Judge Graven, of the Northern District of Iowa, reviewed the "guest cases" decided by this court, to ascertain whether under those decisions, the plaintiff guest had made a case of reckless operation against the driver and the owner of the car. The court directed a verdict for the defendants. The Circuit Court of Appeals, 8 Cir., Iowa, 148 F.2d 562, 566 (April 19, 1945) affirmed, saying that the "trial court reached a permissible conclusion under the applicable Iowa law." Neither the driver nor the guests had much, if any, familiarity with the road on which the car was proceeding, or with the cross road forming the T intersection. The driver, sixteen years old, while driving on an unmarked, but good, graveled country road, the last mile before reaching the *Page 626
intersection being a good dirt road, reduced the speed of the car from seventy-five miles per hour to sixty-five miles per hour, at the request of the occupants, but with the remark that, "I don't care; I'm mad." The car failed to make the turn. The tire marks showed the brakes had been applied thirty-six feet before reaching the intersection.
The fact that the appellee and Salisbury protested to appellant concerning his driving, while admissible, is not controlling on the issue before us. The consideration to which such protests may have been entitled from the appellant depended upon their justification.
[2] II. Appellant assigned error because the court, in instructing upon the signed statement of appellee, heretofore referred to, told the jury that it could be considered only as bearing upon the credibility of the appellee as a witness and not as proving any substantive fact. The instruction was duly excepted to. This statement was admitted generally without any restriction as to its consideration, over appellee's objection that it was incompetent. The instruction unduly and improperly limited the consideration of the statement by the jury. It was proper for the jury to consider it not only in its bearing upon appellee's credibility as a witness, because inconsistent with his testimony, but since it was a deliberate statement over his own signature it was admissible not merely as discrediting the testimony of appellee, if the statement was believed by the jury, but as substantive evidence against him and as bearing upon the worthiness of his whole claim. Castner v. Chicago, B. Q.R. Co.,126 Iowa 581, 585, 586, 102 N.W. 499. The appellee was not only a witness but a party-opponent of appellant, and even though he had not taken the stand as a witness the statement was admissible against him and his case, as based upon his pleadings and the testimony relied upon by him, as a discrediting inconsistency on his part. II Wigmore on Evidence, Second Ed., sections 1048, 1053. The giving of the instruction was reversible error.
[3] III. Appellant assigns error for the overruling of his motion for new trial, but states: *Page 627
"We are convinced that the defendant, on the law, facts and record, is entitled to reversal of the judgment, with an order directing the lower court to set aside the verdict and enter a judgment for the defendant and if we are wrong and are not entitled to a reversal and judgment, we do not want simply a new trial, without a judgment for the defendant."
It has been the uniform rule of this court that a general order of reversal in a law action cancels the district court judgment and sends the case back for a full retrial of the entire case, even though the reversing opinion was based upon the insufficiency of plaintiff's evidence. Landis v. Interurban Ry. Co., 173 Iowa 466, 469, 154 N.W. 607; Owens v. Norwood-White Coal Co., 181 Iowa 948-950, 165 N.W. 177; Perry-Fry Co. v. Gould,217 Iowa 958, 960, 961, 251 N.W. 942; Buttman v. Christy, 197 Iowa 661,663, 664, 198 N.W. 314; Eclipse Lumber Co. v. Davis,201 Iowa 1283, 1289, 207 N.W. 238; Hawthorne v. Delano, 183 Iowa 444,167 N.W. 196; Taylor v. Burgus, 221 Iowa 1232, 1235, 1236,262 N.W. 808. If on retrial no new evidence was offered or the record was not materially different from upon the first trial, the finding of this court upon that evidence would be conclusive against the appellee. Hawthorne v. Delano, supra, 183 Iowa 444,446, 167 N.W. 196. Before the adoption of the new Rules of Civil Procedure, and under section 12871 of the 1924 and subsequent Codes, we have ordered judgment where it clearly appeared that each party had fully presented his case, and that the record on a retrial would very likely not be different. Wilson v. Findley,223 Iowa 1281, 1300, 275 N.W. 47; McCornack v. Pickrell, 231 Iowa 737,742, 743, 2 N.W.2d 57. Section 12871 has been superseded by the new Rules.
But Rule 349 of the new Rules provides that when a judgment is reversed for error in overruling a motion to direct a verdict, and the granting of the motion would have terminated the case in favor of appellant, this court may enter, or direct the trial court to enter final judgment as if the motion had been initially sustained; provided that, if it appears from the record that the material facts relating thereto were not fully developed *Page 628
at the trial, or if, in the opinion of this court, the ends of justice will be served thereby, a new trial shall be awarded of such issue or of the whole case.
In the case before us all of the persons in the car testified. There is nothing in the record to indicate that other persons might have seen the accident at the bridge or the manner in which the car had proceeded. There might possibly be other persons who could give some testimony bearing upon the issues involved but it seems unlikely that they could throw any additional light on the issue of reckless operation.
In Taylor v. Burgus, supra, 221 Iowa 1232, 1235, 1236,262 N.W. 808, the appellant made the same request as that made by appellant here, and this court refused to rule upon assignment that the trial court erred in refusing to sustain his motion to direct a verdict, and summarily accepted appellant's request, and affirmed the judgment for appellee.
In the appeal before it is our conclusion that the court erred in not sustaining appellant's motion for a directed verdict. The judgment is therefore reversed and remanded and the district court is directed to enter judgment for the appellant in conformity herewith. — Reversed and remanded with instructions.
MILLER, C.J., and HALE, OLIVER, WENNERSTRUM, GARFIELD, SMITH, MULRONEY, and MANTZ, JJ., concur.
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The Citizens Bank of Pleasantville, Iowa, was a private bank owned and operated by a copartnership. Some time shortly after the 11th day of August, 1930, the defendant H.H. *Page 495
Browne was appointed receiver of said bank in an action brought against said bank by Miles Galvin et al., as plaintiffs. On August 11, 1930, the Chicago, Burlington Quincy Railroad Company purchased from the Citizens Bank of Pleasantville a draft for $4,675 upon the Iowa National Bank of Des Moines, Iowa, and paid therefor by a check drawn on the Citizens National Bank of Knoxville, Iowa, for $4,616.26, and the balance in cash. The check drawn by said railroad company upon the Citizens National Bank of Knoxville was cashed by the Citizens Bank of Pleasantville, so that there is no question involved concerning the payment for the draft which was purchased. With the closing of its doors on the 11th day of August, 1930, the Citizens Bank ceased to do business, and did not thereafter reopen as a going institution. The railroad company presented the draft for $4,675 purchased by it to the Iowa National Bank of Des Moines for payment on the 12th day of August, 1930. At that time the said Citizens Bank of Pleasantville had on deposit in the Iowa National Bank the sum of $5,721.57, and the total amount of outstanding drafts drawn by the Citizens Bank of Pleasantville on said Iowa National Bank, including the draft issued to said railroad company, was $5,718.21. The amount on deposit in said Iowa National Bank was, therefore, more than sufficient to meet all drafts which had been drawn against it by the Citizens Bank of Pleasantville. Instead of paying the drafts drawn by the Citizens Bank of Pleasantville, the Iowa National Bank applied the amount which the Citizens Bank of Pleasantville had to its credit upon an indebtedness owing by said bank to said Iowa National Bank, and refused payment on the drafts.
Following the appointment of the receiver herein, the railroad company filed its claim against the Citizens Bank of Pleasantville and the receiver in this case, and, after stating facts substantially as above set forth, alleged that said draft was drawn against an actual existing value prior to the failure of said Citizens Bank of Pleasantville, that it was given for money paid in the usual course of business for the purchase of said draft and for the bona fide transfer of funds, and that, under and by virtue of chapter 30 of the Acts of the 43d General Assembly, the said railroad company should have and has a preferred claim against the assets of the Citizens Bank. Thereafter, the railroad company filed a petition of intervention containing substantially the same allegations and in which it prayed that an order be entered establishing its claim to *Page 496
preference in the payment of its said draft in the amount of $4,675 and interest from the assets of said Citizens Bank of Pleasantville in the hands of the receiver. The matter came on for hearing on the 7th day of October, 1932, and was submitted to the court upon an agreed statement of facts, and was taken under advisement by the court. On the 22d day of December, 1932, the court entered an order in which it found that it was bound by the decision of the Supreme Court in Ellis v. Citizens Bank of Carlisle, 211 Iowa 1082, 234 N.W. 849; that the intervener was not entitled to have its claim established as a preferred claim against the receiver of the Citizens Bank of Pleasantville; and ordered and decreed that the intervener's claim be denied as a preferred claim, and that the act of the receiver in allowing said claim as a general claim be confirmed. From said order the railroad company, as intervener, appeals.
Appellant sets out and argues two propositions as grounds for reversal. The first of said propositions is as follows:
"1. The court erred in holding, after finding the facts as claimed by intervener, that it was bound by the decision of this court in Ellis v. Citizens Bank of Carlisle, 211 Iowa 1082, 234 N.W. 849, because (1) the statements of this court in the case cited were by way of dictum; (2) if not dictum, it would be of no effect because it would be contrary to the clearly expressed will and intention of the legislative branch of the government, acting under constitutional authority, in the enactment of section 11, chapter 30, 43rd General Assembly (Code, section 9239-cl)."
Appellant alleges that the decision of this court in Ellis v. Citizens Bank of Carlisle, 211 Iowa 1082, 234 N.W. 849, was not binding upon the trial court because the statements of this court in that case were by way of dictum. The portion of the opinion in said case which appellant claims as dictum is that in which this court held that the provisions of section 11, chapter 30, of the Acts of the 43d General Assembly, did not apply to a private banking institution. In the Carlisle case a preference was claimed and allowed against the receiver, and the receiver appealed. The defenses urged by the receiver, both in the trial court and in this court, against the allowance of the preference, were: First, that the drafts were not issued against existing values; second, that there was no money in the hands of the receiver which constituted the *Page 497
proceeds of said drafts; third, that the drafts simply created the relation of debtor and creditor between the Citizens Bank of Carlisle and the payee; and fourth, that section 11, chapter 30, of the Acts of the 43d General Assembly, does not apply to private banks.
Section 11, chapter 30, of the Acts of the 43d General Assembly, upon which the appellant relies in this case, is as follows:
"Any draft, or cashiers' check issued and drawn against actual existing values by any bank or trust company prior to its failure or closing and given in payment of clearings and any money paid in the usual course of business to any bank, or trust company for the purchase of a draft for the bona fide transfer of funds shall be a preferred claim against the assets of the bank or trust company."
In the opinion in the Carlisle case, this court found that at the time the drafts were issued by the Carlisle Bank it had no money on deposit in the Iowa-Des Moines National Bank upon which the drafts were drawn, but, on the contrary, had an overdraft. As we understand the argument of appellant in this case, it is that the above finding of this court in the Carlisle case was decisive of that case, because it established that there was no actual existing value against which the drafts were drawn; and that, having decided the case on that proposition, the further statements in the opinion to the effect that section 11, chapter 30, aforesaid, did not apply to private banks were mere dicta. In that case, however, one of the defenses made by the receiver and relied upon by him in this court was explicitly stated to be that section 11, chapter 30, of the Acts of the 43d General Assembly, does not apply to private banks. In considering that defense we said:
"It is the claim of the appellee banks that this statutory provision applies to private banks. The material question then is, Does it so apply, and was it the legislative intent in the enactment of this chapter to have it apply to private banks? This chapter in the Session Laws is entitled `Banks and Banking.' It clearly appears from the reading of the said chapter in its entirety that the General Assembly had in mind only state banks and trust companies. No one of the 37 sections of chapter 30 contemplates a private banking institution in any particular mentioned therein. On the contrary, every section of said chapter refers to state banks, savings banks, and trust companies. Resultantly, the appellee banks in the instant case are not in a position to invoke any of the provisions *Page 498
of chapter 30, and base their claims for preference, respectively on a draft which is conceded to be a clearance draft."
[1] We do not agree with the appellant that, because an appeal to this court may present two or more propositions, any one of which would be decisive of the case, a decision of one of such propositions makes the statements of the court in reference to the other propositions mere dicta. As stated in Perfection T.
R. Co. v. Kellogg-Mackay, 194 Iowa 523, reading at page 530, 187 N.W. 32:
"The binding force of a decision is coextensive with the facts upon which it is founded, and if correlated subject-matter is under discussion and decided, such decision is not mere obiter dictum. It is at least a judicial dictum. Chase v. American Cartage Co., 176 Wis. 235, 186 N.W. 598. If a question fairly arises in the course of a trial and there is a distinct decision on that question, the ruling of the court in respect thereto cannot strictly be called a mere dictum. Union Pac. R. Co. v. Mason City Ft. D.R. Co., 199 U.S. 160, 26 S. Ct. 19, 50 L. Ed. 134."
See also, State v. Brookhart, 113 Iowa 250, 84 N.W. 1064; Waddell v. Board of Directors, 190 Iowa 400, 175 N.W. 65.
In our opinion, the question as to the applicability of the statute in question to private banks was fairly before the court in the Carlisle case, and the language used by the court was not dictum, but was a decision of this court on a question squarely presented to the court for its determination.
[2] It is further urged that, even if not dictum, the holding in the Carlisle case that section 11, chapter 30, aforesaid, does not apply to private banks is erroneous, because by its very terms the statute applies to "any bank or trust company," and must, therefore, necessarily include private banks, as well as state banks, savings banks, and trust companies. In the opinion in the Carlisle case it was specifically stated that no one of the 37 sections of chapter 30 contemplated private banking institutions, and that every section of said chapter refers to state banks, savings banks, and trust companies. We may say that we have extended our examination of the banking laws of our state back of the act in question, and that, from the history of such legislation, we are satisfied that all of it has reference to such savings banks, state banks, and trust companies only as are organized and operated under specific statutory provisions. *Page 499
We find no statutory provisions for the organization or operation of private banks, and we find nothing to indicate that section 11 or any other provision of chapter 30 of the Acts of the 43d General Assembly was intended to refer to private banks. The holding in the Carlisle case to the effect that section 11, chapter 30 aforesaid, does not apply to private banks was quoted with approval in Shifflett v. Bank of Earlham, 215 Iowa 823, 246 N.W. 757. We see no reason why that holding should now be held erroneous and set aside.
[3] II. In connection with the second proposition set out by appellant, in which it is contended that the findings of the court were in violation of Article III, section 1, of the State Constitution, it is argued that the meaning of section 11, chapter 30, aforesaid, was so clear and its application to private banks so apparent that this court, in deciding otherwise, was giving to the language of said act a meaning which was not intended by the legislature, and was thereby guilty of usurping the functions of the legislature in violation of the State Constitution. From what has already been said, it is apparent that, to the members of this court at least, the language of the statute does not show the legislative intention to make it applicable to private banks as clearly as the appellant contends. In our opinion, there was no intention on the part of the legislature to make this statute applicable to private banks, and, in holding that it does not apply to such banks, we are not violating the Constitution and assuming the functions of the legislature, but are simply carrying out the legislative intent.
For the reasons given, the decree of the trial court is affirmed. — Affirmed.
ALBERT, C.J., and KINDIG, EVANS, and CLAUSSEN, JJ., concur.
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The plaintiff, appellant, is an inmate of the State Hospital for the Insane at Independence, Iowa, and the defendant is the superintendent of said institution. Plaintiff's claim is that since his confinement in that institution on or about *Page 1285
the 4th day of March, 1929, he has been restored to sanity, and is therefore entitled to his discharge. A writ was duly issued in pursuance of his petition by authority of the commissioners of insanity, and answer filed by the defendant in which it is alleged that he holds the custody of the plaintiff by reason of the writ issued by the district court of Grundy County, Iowa, on the 4th day of March, 1929. In pursuance of said writ the body of said plaintiff was produced in court and a hearing had on May 12, 1931, resulting in the quashing of the writ and the remanding of the plaintiff to the custody of the defendant.
The principal complaint is that under the record plaintiff has shown his restoration to sanity, and the court erred in not so finding. The record shows that on March 4, 1929, the plaintiff was informed against before the commissioners of insanity of Grundy County, Iowa. A hearing was regularly had, and said commissioners made a finding that the plaintiff was insane and a fit subject for custody and treatment in the hospital, and a warrant for such commitment was duly issued and the defendant confined in pursuance thereof. Later, about July 17, 1930, plaintiff instituted habeas corpus proceedings against the same defendant as superintendent of said hospital. A hearing was had thereon in the district court of Buchanan County, and the writ was discharged, and the plaintiff remanded to the custody of the superintendent of said Hospital for the Insane at Independence until further action. About the 7th day of May, 1931, the present proceedings in habeas corpus were instituted in the same district court, resulting as above stated.
The plaintiff having been legally declared insane by the commissioners of insanity of Grundy County and a fit subject for treatment at the hospital, such condition is presumed to continue and to exist at the time of the hearing of this matter in the district court, and establishes prima facie that he was insane at the time this proceeding was being heard, and the burden is upon him to show restoration to sanity by competent and sufficient evidence. We reviewed this question fully in the case of Hazen v. Donahoe, 208 Iowa 582. In default of such a showing of recovery of sanity by competent and sufficient evidence, the writ should be dismissed and the petition remanded.
Numerous witnesses were examined in the case, a number *Page 1286
of whom never saw the plaintiff after he was committed to the hospital on the 4th day of March, 1929. The real question before the court on this hearing was his mental condition in May, 1931. As suggested above, the plaintiff was confronted with the presumption that he was insane, and the burden of proof was upon him to show restoration to sanity on that date; hence much of the testimony (if admissible) from witnesses who never saw him after he was confined in the hospital under said commitment is of no weight in determining the real question involved herein. Several witnesses however testified that they visited the plaintiff while he was confined in the hospital and could see no indications of insanity. Three of the employees of the hospital testified that they saw the plaintiff frequently and saw no evidence of insanity, and some of them talked to the plaintiff on the day of the trial and say they were confirmed in their notion that the plaintiff was not insane on that date.
This testimony is met by the testimony of the defendant, the superintendent of said hospital, who testifies that the plaintiff is suffering from a form of insanity known as paranoia. He testified that when one has such mental affliction he does not recover; that it is probably the most dangerous type of insanity; that one afflicted with paranoia has persecutory delusions, but the mind is clear on all other subjects; that there has been no change in the condition of the plaintiff since he came to the hospital; that he has seen and talked with him many times and at different times has made examination, and the plaintiff was insane on the day of the trial. He testified further that a mental affliction of this kind is rarely perceptible to the layman, and sometimes it is a difficult proposition for a skilled psychiatrist to diagnose, but that in his opinion the plaintiff, on the date of the trial, was still suffering from paranoia, and there was no improvement in his mental condition since the date of his commitment. The least that can be said of the record at this point is that there is a square conflict between the lay witnesses and the defendant superintendent of the hospital. The district court had these witnesses all before him, and reached the conclusion that the writ should be discharged and the plaintiff returned to the custody of the defendant. With this conclusion we are disposed to agree. The plaintiff having the burden of showing that on the date of the hearing his mind had been restored, *Page 1287
we do not feel that he has sustained this burden, and, therefore, the district court was right in his conclusion.
No benefit would result to the plaintiff or to the profession by setting out the evidence in the case, and suffice to say we have read the same with the care which a case of this importance demands, and reach the conclusion that the action of the district court was correct.
Certain errors are assigned as to the admission or rejection of testimony. We have given attention to these, and while some of the objections were technically good, the evidence is not of that character which would warrant us in basing a reversal thereon. Other objections were properly sustained by the court, and equally so is the ruling correct in rejecting certain testimony. — Affirmed; writ discharged.
STEVENS, C.J., and FAVILLE, WAGNER, and De GRAFF, JJ., concur.
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Brice L. Clutier filed an application in probate alleging that he is a nephew and the only prospective direct heir of W.E. Brice, the incompetent ward; he is incapacitated, because of illness, from obtaining employment; he has no income or other means of support for himself and his wife; his wife is seriously ill and unable to earn; for the last ten years during which W.E. Brice was competent he took great interest in applicant and his family and voluntarily paid the rent on the apartment occupied by them in Chicago and otherwise supported them; such contributions by Brice continued up to the time he became insane; prior to his incompetency Brice had declared his intention to furnish such support and, if now sane, would be furnishing at least $250 a month for such purpose. The applicant prayed that the guardian be authorized to pay him $250 per month.
The guardian's answer denied the statements of the application and denied that the court had power to make any such order. Following a hearing at which evidence was offered in support of the application, the court ordered the guardian to pay the applicant for the care and support of himself and family $250 per month until further order of the court. The guardian has appealed.
There is practically no conflict in the evidence. W.E. Brice, *Page 185
then about eighty-one, a man of large means, was adjudged incompetent and appellant was appointed his guardian on January 11, 1941. He has been a patient in a Mason City hospital since September 1940. His attending physician expressed the opinion that his mental incapacity would never improve. The ward is a widower without dependents. He had no children, no brothers, and but one sister, the mother of Brice L. Clutier, the applicant. This sister died in 1915, leaving the applicant, and another son who died in 1920 without having married. The guardian is apparently a responsible and careful business man who was employed by the ward for thirty-five years and was intimately acquainted with his affairs. He was unable to find any will made by Brice.
The applicant is fifty-three. His father, past seventy-six, is employed in a small way by a Chicago bank at $125 a month. The father has no money or property but has contributed from his earnings a dollar a day for the support of applicant and his wife. Formerly, the father had been associated with W.E. Brice as a typist and "errand boy." The applicant has a married daughter who is unable to contribute to the support of her parents. The applicant had been associated for a time with his uncle as a companion and helper, but received no definite pay. The applicant's health is poor and his wife is an invalid. He is the victim of fainting spells. He is a veteran of World War I. He has been able to do only about four months' work in the last ten years during which his total earnings have been $900 to $1,000. In that period his hospital and doctor bills have totaled about $3,600.
A lady who was employed by Mr. Brice for many years as his secretary testified, in substance, that he would always say, "I have Brice [the applicant] on my hands from now on"; he was not complaining, but that was his customary remark; that her employer very often spoke of his affection for the applicant's daughter and sent her money. Since March 1926, Brice frequently sent money to the applicant, usually in amounts from $50 to $100, but sometimes as much as $150 to $200.
Checks were found, payable to the applicant personally, made during the last nine years of the ward's sanity, to the *Page 186
total average amount of $872 per year. There were other checks payable to the applicant's father and daughter, apparently for the benefit of the applicant and his family, and substantial sums were sent by Mr. Brice to his nephew by money order and telegraph. The total amount of these payments does not appear but a finding would be warranted that it is much larger than the amount of checks payable to the applicant. The guardian testified that Brice said many times that he intended to take care of his nephew as long as he needed assistance; that he felt it his duty to do so.
The personal estate of the ward was appraised at $1,104, 825. This did not include the real estate. When the guardian was appointed in January 1941, there was on hand cash of about $255,000 which was used on December 4, 1941, to purchase United States treasury bills. The gross earned income for 1941 was $49,693.50. An allowance of $1,500 per month has been made for the support and maintenance of the ward and the upkeep of his home and office.
[1] I. The guardian's first contention is that the order of allowance amounts to the taking of the ward's property without his consent, in violation of the due-process provisions of the Federal and State Constitutions (section 1, Fourteenth Amendment, Constitution of the United States, section 9, Article I, Iowa Constitution) and section 1, Article I, Iowa Constitution. It is sufficient answer that no such contention was made in the court below. Constitutional questions cannot be raised for the first time upon appeal. Martin Bros. Co. v. Fritz, 228 Iowa 482, 492,292 N.W. 143, and cases cited; New York Life Ins. Co. v. Breen,227 Iowa 738, 750, 289 N.W. 16, and cases cited.
[2] II. It is next argued that the court had no power under the statutes to make the order of allowance.
The question involved upon this appeal has never been passed upon by this court. However, there is considerable outside authority to the effect that courts have wide powers in directing the management of an incompetent's estate and in a proper case may authorize an allowance to one to whom the ward owes no legal duty to support. In such matters the court may direct that to be done which the incompetent, if sane, would probably have done. The power of the court in such matters *Page 187
has been likened to its right to authorize donations by a guardian for charitable purposes to which the incompetent had formerly been in the habit of making contributions. Some of these authorities are Woerner on Guardianship 457; Shelford on Lunatics, 2d Ed. 205; Buswell on Insanity, 120-123, sections 103, 104; 25 Am. Jur. 52, section 79; 32 C.J. 708, section 438; In re Flagler, 248 N.Y. 415, 162 N.E. 471, 59 A.L.R. 649, and annotation 653; Potter v. Berry, 53 N.J. Eq. 151, 32 A. 259, 34 L.R.A. 297, and annotation, 51 Am. St. Rep. 626; Farwell v. Commissioner, 2 Cir., N.Y., 38 F.2d 791; Sheneman v. Manring,152 Kan. 780, 107 P.2d 741; Citizens State Bank v. Shanklin, 174 Mo. App. 639, 161 S.W. 341; Hambleton's Appeal, 102 Pa. St. 50.
In determining whether the incompetent, if sane, would contribute to the support of a relative to whom he owes no duty of support, the court will consider the needs of the relative, the relationship and intimacy which he bore to the incompetent prior to the adjudication of incapacity, the present and probable future requirements of the incompetent himself, whether others are dependent upon him for support and the extent of such dependency, the size and condition of the estate — giving to these and any other pertinent matters such weight as the incompetent, if sane, probably would have given. In re Fleming's Estate, 173 Misc. 851, 19 N.Y.S.2d 234, 236, and cases cited.
While courts should act cautiously in making an allowance to one whom the incompetent is under no legal duty to support, having in mind at all times the welfare of the ward, this case seems properly to fall within the rule of these authorities. The ward, now over eighty-two and without dependents, appears to be incurably insane. So far as possible, all his needs and comforts are provided for. The estate is well in excess of a million dollars. The applicant is destitute. He and his wife are unable to work. The trial court found that the incompetent, in all probability, if sane, would provide for the support of the applicant and his family. There is ample evidence to support the finding. This is a probate matter not triable de novo here. In re Estate of Hale, 231 Iowa 1018, 2 N.W.2d 775, 779, and cases cited. *Page 188
The probate court had full jurisdiction of the estate of this ward. The property was in custodia legis subject to the orders of the court. Haradon v. Boardman Cartwright, 229 Iowa 540, 546,294 N.W. 770. We think there is statutory authority for the making of the order. Section 12581, Code, 1939, made applicable to such a guardianship as this by section 12613, provides:
"Guardians * * * must prosecute and defend for their wards, may employ counsel therefor, lease lands, loan money, and in all other respects manage their affairs, under proper orders of the court or a judge thereof."
We have frequently recognized that this statute is the important broad provision governing the powers and duties of a guardian to act under the supervision of the probate court. Speaking of substantially the same provision as section 12581 (section 2250, Code, 1873), it is said, in Bates v. Dunham,58 Iowa 308, 310, 12 N.W. 309, 310:
"The powers which the guardians of property possess are conferred in section 2250."
It is our duty, by express legislative command, to construe this statute liberally, "with a view to promote its objects and assist the parties in obtaining justice." Section 64, Code, 1939.
We have held that the purchase of real estate with funds belonging to the ward amounts to the management of the ward's estate. Kowalke v. Evernham, 210 Iowa 1270, 1274, 232 N.W. 670. Also that the court has the power to order a guardian to purchase real estate with funds of the ward. In re Estate of Wisner,145 Iowa 151, 153, 123 N.W. 978. We have also held that, even in determining the nature and scope of the expenditures of a guardian which may be properly approved, the court is vested with considerable discretion. Des Moines Sav. Bk. v. Krell, 176 Iowa 437,441, 442, 156 N.W. 858; In re Guardianship of Fish, 220 Iowa 1328,1333, 264 N.W. 542. We think the making of these payments to the applicant under the facts shown here, as authorized by this order of the probate court, properly falls within the management of the ward's affairs. *Page 189
[3] III. The guardian also contends that the order was not justified under the evidence, even assuming the power of the court to make it. It is argued that it does not sufficiently appear that the incompetent, if sane, would probably have contributed as much as $250 a month for the applicant's support. It is true the evidence does not disclose the exact amount contributed by Mr. Brice while sane for the support of the applicant and his family. And there is no way of knowing just how much the ward would now contribute if insanity had not overtaken him. However, if the probate court had authority to act in the matter, it had at least some discretion in determining the amount to be paid. The order is effective only until the further order of the court. We are not prepared to hold under the record that there was an abuse of discretion.
[4] IV. It is contended the court erred in that it does not appear that these payments can be made out of the surplus income from the estate but that resort to the principal may be necessary.
In most of the cases where allowances from guardianship funds have been authorized for the support of one whom there is no legal duty to support it is probably true that the payments could be made from surplus income. The more recent authorities, however, apparently do not limit the payments which may be authorized to those that can be made out of surplus income. The controlling principle is that the court will act with reference to the incompetent and for his benefit as he would probably have acted if sane. In re Fleming's Estate, 173 Misc. 851, 19 N.Y.S.2d 234, holds that such payments may be made even though resort to the principal is necessary. However, payments to one holding no legal obligation against the incompetent should not be authorized unless adequate provision has first been made for the ward.
We find it unnecessary to determine whether such an allowance should be made out of the principal of the ward's estate. It is probable that these payments can be made out of the surplus income without resort to the principal. In any event, it is certain that neither the ward nor his large estate will ever suffer because of these comparatively small payments. *Page 190
This case was tried in April 1942, after the guardianship had been in effect a little more than fifteen months. As stated, the income from the estate for the first year was nearly $50,000. And about $255,000 in cash, or nearly one fourth the personal estate, seems to have been uninvested until December 4, 1941, when United States treasury bills were purchased at a price yielding but 15/100 of one per cent. Such large nonrecurring expenditures were made during the first year that it is hard to ascertain just what the net surplus income was in 1941 or will be in the future. But it will be surprising if there is not sufficient income left from this estate of well over $1,000,000, after supplying the wants of this insane man and paying taxes and expenses of the guardianship, to make these payments to the applicant without resort to the principal.
[5] V. The court allowed the applicant $50 to cover the expense of himself and wife in attending the hearing. They live in Chicago. The guardian attacks this provision of the order because the application did not specifically ask for such relief. The application did ask that the costs of the hearing be paid by the guardian. We are cited to cases holding that a judgment cannot be rendered for an amount greater than asked in the petition. We are not disposed to hold, on the ground that the prayer of the application did not specifically ask therefor, that this allowance of expense money was improper. Sufficient basis for our conclusion is that the technical rules of pleading are not strictly applied in a probate matter such as this. Soppe v. Soppe, 232 Iowa 1293, 8 N.W.2d 243, 245, and cases cited.
The order is — Affirmed.
BLISS, OLIVER, HALE, and MULRONEY, JJ., concur.
WENNERSTRUM, MILLER, SMITH, and MANTZ, JJ., dissent.
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01-03-2023
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07-05-2016
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I do not approve of the conclusions reached in the majority opinion and the pronouncements therein made, and therefore respectfully dissent. The filing of a dissent, in the main, is a futile judicial effort. However, justification for the submission of a dissent may be found in one of the following reasons: It often gives the writer an *Page 191
opportunity to use material intended for inclusion in a majority opinion, garnered from sources that were considered authorities prior to the time the majority opinion was filed; it also gives the dissenter an opportunity to publicly indicate that he is not disposed to let go unchallenged the statements expressed by the majority; it frequently permits a dissenter a chance to express his disapproval of judicial legislation; and, finally, it affords a means of presenting authorities that support the writer's views. Whatever may be the justification for this particular dissent, the following comments in support of it are respectfully submitted:
The majority opinion, by inference at least, admits that the basis of the order which it approves is by reason of the statutory authority given by section 12581, 1939 Code, which by reason of section 12613 is applicable to the present situation. This inferential admission indicates that the majority are of the opinion that there must be some statutory authority for the court to authorize that certain acts be done by the guardian.
The majority opinion cites the case of Bates v. Dunham, 58 Iowa 308,310, 12 N.W. 309, 310, but does not set out an important statement in that opinion. Prior to the part quoted in the majority opinion from this last-cited case it is stated:
"We are of the opinion that section 2250 of the Code modifies the common law rule as to the power of a guardian over the property of his wards."
It will be thus observed that in this early case this court held that guardianship proceedings are subject to statutory control. It is suggested that section 64, 1939 Code, gives authority for the liberal construction of our statutes. It is true that this section does provide that the provisions of the Code "* * * shall be liberally construed with a view to promote its objects and assist the parties in obtaining justice." But no solace can be taken from that section if there is no statutory authority authorizing an act. It is said, in the case of Rural Ind. Sch. Dist. v. McCracken, 212 Iowa 1114, 1126, 233 N.W. 147,153:
"A statute cannot be extended by construction so as to cover acasus omissus, as recognized and claimed by the instant plaintiff." *Page 192
It was further said, in the case of Iowa-Des Moines Nat. Bk.
Tr. Co. v. Alta Casa Inv. Co., 222 Iowa 712, 715, 269 N.W. 798,800:
"* * * and this court cannot put something into the statute which it does not contain."
It must be admitted that any statutory authority for the act which the majority opinion approves comes from the provision in section 12581 of the Code in which it states, in relation to the powers of the guardian, that "guardians * * * must * * * in all other respects manage their [minors'] affairs, under the proper orders of the court or a judge thereof."
The majority opinion has overlooked the fact that this particular portion of the quoted Code section has heretofore been passed upon by this court in the case of Andrew v. Sac County State Bank, 205 Iowa 1248, 1255, 1256, 218 N.W. 24. This court therein adopted the definition of the word "manage" taken from Webster's International Dictionary, as follows: "To direct affairs; to carry on business or affairs; to administer; also, to admit of being carried on." In this same citation 38 C.J. 523 is quoted, as follows: "To manage money is to employ or invest it."
In the case of In re Guardianship of Nolan, 216 Iowa 903,249 N.W. 648, it is held that the statute in relation to the investment of funds of a guardian must be followed.
This court in the case of Easton v. Somerville, 111 Iowa 164,172, 82 N.W. 475, 478, 82 Am. St. Rep. 502, in commenting upon the powers of a guardian, stated:
"A guardian cannot, as at common law, loan his ward's money, or invest it in securities, without an order of court. His powers are conferred by statute, and he may loan their money, and in all other respects manage their affairs, under proper orders of the court, or a judge thereof. Code, section 3200."
In connection with the consideration of Code section 3200 [Code, 1897], which is now incorporated in Code section 12581, we said, in the case of McIntire v. Bailey, 133 Iowa 418, 422,110 N.W. 588, 590: *Page 193
"In the absence of statute it is the duty of a guardian to keep his ward's money and property separate from his own; to keep an account thereof; to make investments, not in his own name, but as guardian; and to keep those investments separate from his own. These duties are so well understood that we need not cite authorities, in their support."
In considering the question of the propriety and legality of the order approved by the majority we can well give consideration to the prior statements of this court as to the purpose of a guardianship.
In the case of Zander v. Cahow, 200 Iowa 1258, 1264,206 N.W. 90, 93, in commenting upon the purposes of a guardianship wherein the question of the necessity of appointing a guardian was in question, this court said:
"* * * the object of guardianship is to conserve the property for the owner * * *."
See, also, Huffman v. Beamar, 198 Iowa 1113, 197 N.W. 476; Perry v. Roberts, 206 Iowa 303, 308, 220 N.W. 85.
The majority opinion cites as authority the case of Kowalke v. Evernham, 210 Iowa 1270, 1274, 232 N.W. 670. A review of this case shows that under the statute at the time it was considered this court might have approved the investment of funds in regard to the estate. In the present case we are not concerned with the investment of funds of the ward's estate but are authorizing the expenditure of money without statutory authority. A further claimed authority on the part of the majority is In re Estate of Wisner, 145 Iowa 151, 153, 123 N.W. 978. This is another case in which the court approved the investment of the guardian's funds in real estate. Inasmuch as it had been previously approved and directed by a prior order of court, this action was perhaps justifiable under the general powers of management and would come under the classification of an investment. Other authorities cited by the majority opinion are Des Moines Sav. Bk. v. Krell,176 Iowa 437, 441, 442, 156 N.W. 858, and In re Guardianship of Fish, 220 Iowa 1328, 1334, 264 N.W. 542. A review of these cases shows that the expenditures there approved were in the interest of the wards. *Page 194
The allowance approved in the majority opinion is not in the interest of the ward, and to say that it is justified under the statutory authorization of the power "to manage" gives elasticity to the words that will surprise even a liberal-minded lexicographer.
It seems quite apparent that the legislature has indicated the scope of expenditures that might be made by a guardian for the care of individuals. This is evidenced by section 12628 of the 1939 Code, which is as follows:
"Sale or mortgage of real estate. Whenever the sale or mortgage of the real estate of such ward is necessary for his support, or for the support of his family, or the payment of his debts, or will be for the interest of the estate or his children, the guardian may sell or mortgage the same, including the homestead under like proceedings as required by law to authorize the sale of real estate by the guardian of the minor."
A further section that definitely indicates the legislative limitation of the expenditure of the ward's funds for the support of individuals is found in section 12629 of the 1939 Code of Iowa, which is as follows:
"Allowance to family. The court shall, if necessary, set off to the wife and minor children of the insane person, or to either, sufficient of his property, of such kind as it shall deem appropriate, to support them during the period such person is insane."
If the legislature desires to broaden the nature of the expenditures that may be made from a ward's estate, I feel that it is the prerogative and duty of that body to say so rather than have this court, by judicial pronouncement, judicially legislate as has been done by the majority opinion.
Heretofore it had been my understanding that the trial court, as well as this court, was bound by the limitations of statutory authority in connection with probate matters. In the case of Young v. Gammel, 1854 4 (G. Greene) Iowa 207, 211, this court, in commenting upon the rights of a minor, said:
"In contemplation of law they could neither do nor suffer *Page 195
to be done anything, as of contract, so as to dispose of their right to the estate or the use of it, without the interposing power of the proper court, in accordance with law."
A further evidence of the fact that the probate court heretofore has been limited in its authority to that given by statute is evidenced by the case of Dutch v. Marvin, 1887,72 Iowa 663, 664, 665, 666, 34 N.W. 465, 466. In this case plaintiff was guardian of her husband, who was insane. She made application to the district court for an allowance out of the guardian's estate for the support of herself and her minor children. Intervener, a creditor, resisted the application. In this case reference is made to particular Code sections then in force. This court therein said, in part:
"The right created by section 2375, by the express terms of that section, is for the benefit of the widow and children of the decedent. The section creates a right in their favor after the death of the husband and father; the right being to a support for a limited period out of the estate. In the absence of such provision, their right to a support would terminate at his death; and the property, unincumbered by any claim by them for support, would take the course of descent prescribed by the law. The section is a special provision, applicable, by its terms, to particular cases; and the benefits created by it cannot be extended to other classes than those enumerated in it, except by special enactment or necessary implication. And we think that section 2278 does not have the effect to confer the same right upon the wife and children of an insane ward. That section is remedial in its character; that is, it points out the mode or manner in which the estate of the ward, when insolvent, shall be settled. But neither by its express provisions, nor by any necessary implication, does it create or confer any rights upon the family of the ward. The courts cannot, by mere inference from the general policy of the statutes of the state, create rights in their favor; but the legislature must be presumed to have enumerated all that was intended to be created or conferred. If cases of special hardship are liable to arise under the statutes as they now exist, the remedy must be provided by the legislature; the courts cannot create such remedy." *Page 196
A further authority to this same effect is found in Ratcliff v. Davis, 64 Iowa 467, 468, 469, 20 N.W. 763, wherein this court, in commenting upon the right of a guardian to waive the homestead rights of his ward, said:
"It is claimed by her guardian that, because she is incapable of making her wishes known, his preference shall be substituted for hers, and that he can waive the statutory provisions. We do not think he has any power to do so, because, as it appears to us, the right is a personal one, and, if not exercised for any reason, even though it be her incapacity to do so, no other person can act in that behalf in her stead."
See, also, Singleton v. National Land Co., 183 Iowa 1108,167 N.W. 97.
It has heretofore been my belief that the guardian of a ward is a conservator of the ward's estate, and that guardianship proceedings anticipated that the guardian would preserve the estate. It has been my further belief that the statute heretofore limited the expenditures to the members of the ward's family, but with the holding of the majority opinion it is apparent that that is not now the law.
In connection with the allowance made to the applicant, it should be kept in mind that if this applicant had sought to require his uncle to support him while the present ward was sane and the uncle had refused there would have been no statutory authority that would have required it. Code section 3828.074, 1939 Code, limits the liability of the support of any poor person to parents and children; and Code section 3828.077 to grandparents and male grandchildren. It is difficult to understand by what reasoning the court can say that a ward's estate can be required to support an individual when that support could not be enforced if the person under guardianship were sane.
In connection with the administration of estates of decedents, this court has on numerous occasions held that their administration is a matter of statutory enactment. In the case of In re Estate of Rugh, 211 Iowa 722, 724, 234 N.W. 278, 279, we said: *Page 197
"The administration of the estate of a decedent within this state is solely a matter of statutory enactment."
In In re Estate of Harsh, 207 Iowa 84, 87, 218 N.W. 537, 539, this court said:
"Administration of estates of deceased persons is undertaken by the state through its courts, and pursuant to its statutes. The administrator is the officer of the law and of the court, and conducts the administration pursuant to the provisions of the statutes, under the court's authority and supervision."
Numerous authorities, holding to the effect that the probate court in the administration of estates is limited to the authority given by statute, can be cited. I do not quote from them because to do so would unnecessarily lengthen this dissent, but reference is here made to the following cases: Valley National Bank v. Crosby, 108 Towa 651, 653, 655, 79 N.W. 383; McFarland v. Howell, 162 Iowa 110, 117, 143 N.W. 860; In re Estate of Munger, 168 Iowa 372, 375, 150 N.W. 447, Ann. Cas. 1917B, 213; In re Estate of Collicott, 226 Iowa 106, 111,283 N.W. 869; Bookhart v. Younglove, 207 Iowa 800, 218 N.W. 533.
If, in the administration of estates of decedents, we have held that the authority for administration is a matter of statutory enactment, it would seem that we should follow that practice in connection with the administration of guardianship estates. This is particularly true when we consider that the real purpose of a guardianship is to preserve and conserve the ward's estate.
The majority opinion does not state that the theory as to an allowance such as is approved by it was first announced by Lord Eldon, Chancellor, speaking for the Chancery Court in the case of Ex parte Whitbread, 1816, 2 Mer. 97. This last-cited case was followed by a further English Chancery case of In re Blair, 1836, 1 Myl. C. 300, 303. In this case Lord Cottenham, Chancellor, in commenting upon an authorization of an allowance to a nephew of a lunatic, said:
"The practice, however, was one which could not be regarded with too much caution, and the principle involved in it *Page 198
ought to be narrowed rather than extended in its operation; and his Lordship desired that it might be understood, that he would never exercise such a jurisdiction without the greatest possible jealousy and caution. As however, the principle had been so far followed, and as there seemed no probability that the lunatic would recover, or would be capable of greater enjoyments than those which were now afforded to her, his Lordship would, in the present instance, make the order."
In the adoption of the majority opinion we have an opportunity to observe how precedents grow and attach themselves to our judicial system despite the belief that laws are enacted by legislatures and that courts should interpret them. A review of the several cases that have approved of an allowance such as is permitted in the instant case shows that it was usually a chancery court that authorized it. This is true as to virtually all the English cases that have been brought to my attention.
The majority opinion cites, as authority for its holding, Woerner on Guardians, 1897, 457; Shelford on Lunatics, 1847, 2d Ed. 205; Buswell on Insanity, 1885, 120, 123, sections 103, 104. A study of these authorities shows that the writer of the particular text merely set forth the prior pronouncements of the English chancery courts. In 25 Am. Jur. 52, section 79, cited as authority by the majority, it is stated:
"Also, a court of equity has power out of the surplus income of the estate of an insane person to provide for the support of persons whom the insane person is not under legal obligation to support, where it specifically appears that the insane person himself would have provided for such support had he been sane."
The cited authorities for this last-quoted statement are, in the main, shown to be the pronouncements of equity courts.
The case of Sheneman v. Manring, 152 Kan. 780, 107 P.2d 741, holds that an allowance to an indigent daughter of an insane ward was proper. Such would have been the holding in Iowa, under our statutory authority. It is difficult to see in what way this case can be held as authority for the majority opinion. *Page 199
The other cases cited by the majority as authority for the allowance approved by it give some support to their holding. None of these cases sets forth the statutory authority for the approval of the allowance. In virtually each instance the early English chancery cases are cited as precedent. As previously stated, thus do precedents develop despite the fact that Lord Cottenham, Chancellor, in the case of In re Blair, supra, said that allowances of the character he approved "could not be regarded with too much caution."
By the majority opinion we are establishing a precedent for large guardianship estates and small ones. It will be followed despite the size of the ward's estate. It is a precedent that is established without definite statutory authority. I cannot approve of such judicial legislation. I believe I am just as sympathetic in regard to the welfare of the applicant for the allowance as are the members of the court that approve the majority opinion. But precedents should not be established because of sympathetic motives. I regret the length of this dissent but I am concerned because of the tendency of courts to assume the prerogatives and duties of the legislature. I would reverse.
I am authorized to state that SMITH, MANTZ, and MILLER, JJ., join in this dissent.
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01-03-2023
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07-05-2016
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This case was brought by the plaintiff, Hazel M. Gisin, against the Farmers Automobile Interinsurance Exchange, in the municipal court of the city of Des Moines. The petition stated that the plaintiff was a resident of Des Moines, and that the defendant was a reciprocal insurance company with its principal place of business at Los Angeles, California, but was doing business and maintaining a state agent office in the city of Des Moines. That about the 12th day of July, 1933, through a local soliciting agent of the defendant, she filed an application for insurance against public liability, property damage, fire and theft, and collision and upset insurance; that the application was taken to the office of the state agent at Des Moines, accepted by the defendant, and she was informed her policy was in force and effect from the date of the application. That it was the understanding and agreement between her and the defendant, through its agent, that the policy of insurance would be in force and effect from the date of the application. That the defendant company notified the plaintiff that the policy was effective as of July 12, 1933, and notice coming from the company through the United States mails. That the policy was still in the hands of the defendant, and the plaintiff could not attach a copy thereof; and she alleges it was further agreed by the company, through its duly appointed agent, that the policy was to be paid for by her upon the actual delivery of the policy to her, but that it would be effective as of the date of application. That on the 13th of July, 1933, while her husband was driving the car, it skidded on a gravel highway, came into collision with a guide post by the side of the road, and was upset and seriously damaged, in the sum of $442.50; that she duly notified the defendant of the loss and filed proof as required by the company, and had performed all the terms and conditions imposed upon her by the agreement for insurance; that the defendant had refused to pay plaintiff's claim, and prayed for judgment. *Page 1375
The answer denied each and every allegation of the plaintiff's petition, and stated further that if any policy ever came into existence that same was voided by reason of a false answer, and a misrepresentation in the application: "Item 15. Has any company cancelled or refused to issue or pay claim on any insurance or on any car you have owned?" Plaintiff answered, "No". The fact is that at the time the application was made a policy had been canceled by the Travelers Indemnity Company. Again the answer set up that the application asked, "Give particulars and dates of any previous automobile accidents involving applicant," to which she answered, "None". Again it asked whether she had been refused insurance or claim had been paid or had any policy been canceled by any company on any car she owned, and she answered, "No". And the application further asked, "Has applicant personally assured you that all brakes, lights and windshield wiper function properly?" and the answer was "Yes". The answer stated that the plaintiff misrepresented the car which was the subject of the application when she said it had not been wrecked or destroyed or damaged at the time the application was accepted or the contract concluded. And again, that if any insurance ever took effect, that the same was voided by reason of nonpayment of the membership fee required in the application known as Exhibit A, and the defendant alleges that the insurance never took effect, and that there was no contract with the Farmers Automobile Interinsurance Exchange on the part of the plaintiff, for the reason that the condition precedent prescribed in the application of payment of membership fee was never fulfilled, and the defendant specifically denied the performance by the plaintiff of this precedent.
The reply denied each and every material allegation contained in the answer, and that if the application provided for payment of any premium in advance, such condition was waived by the defendant through its duly authorized agent; and set forth that the application had been written by the defendant's own soliciting agent, and he had full knowledge concerning all the facts and circumstances, transactions, and statements made therein, and that such knowledge is chargeable to the defendant in this action, and the truth or falsity was known to the defendant in this action; and set forth these were waived because of the knowledge of the soliciting agent, and that there is a waiver under the law of any provisions in the policy or application affecting any insurance or any policy *Page 1376
of insurance in this case; that the defendant was estopped from denying that the plaintiff's car was insured under the facts and conditions in this case, and are estopped from denying that the application was not accepted by reason of the facts and circumstances that they notified the plaintiff that it had been accepted, and by reason of the further fact that they notified the plaintiff through the United States mail that she had been accepted as a member in the association, and that her policy was in force and effect as of July 12th; and that they were estopped from claiming a failure of plaintiff's car to be insured by reason of all these facts and circumstances and the conduct of their agent as shown by the evidence.
The application for insurance was made by one Levi, claiming to act as the agent for the defendant. The defendant company, as its name implies, and as it later shows, is organized and doing business as provided in the Code of 1931 under chapter 408, which provides for reciprocal or interinsurance contracts. This statute is an act of the 37th General Assembly, chapter 180, consisting of 16 sections, which was approved April 7, 1917 (as amended). The last section of which, section 16, now section 9103 of the Code of 1931, reads as follows:
"Except as herein provided in this chapter, the making of contracts as herein provided for and such other matters as are properly incident thereto, shall not be subject to the laws of this state relating to insurance, unless they are therein specifically mentioned."
The effect of this latter provision has been somewhat discussed by this court in Schmid v. Underwriters, 215 Iowa 170, 244 N.W. 729. The court was there discussing section 8959 of the Code, which provides for the forfeiture of policies, and in that discussion says, on page 174:
"Code section 8959, above quoted, does not specifically mention reciprocal or interinsurance contracts. Hence the reciprocal or interinsurance contracts, because of section 9103, are not subject to the provisions contained in section 8959. Then the notice actually given by the appellant for the lapsing of the contract with the assured, being in full compliance with the contract, was sufficient to accomplish the lapse of the policy even though such notice does not comply with the requirements of section 8959. A lapse of the policy was accomplished because the notice fully complied with the contract. The district court, then, wrongfully submitted the cause to the *Page 1377
jury on the theory that the policy had not been lapsed. Error appears at this juncture."
The effect of this provision, section 9103, then, seems to be that the various provisions of the Code in reference to insurance are not applicable to insurance of the character claimed in this suit; that is, written by the defendant. This provision in the statute, section 9103, then puts insurance in reciprocal companies on an entirely different footing from insurance in other organizations. Whether this be wise or not, it is not for us to say. The legislature of the state of Iowa has seen fit to create in this chapter an entirely different rule than is applicable to other insurance organizations, and wherever a restriction is placed by a law upon other insurance companies doing business, such restriction does not apply to insurance written on this plan, unless it is specifically mentioned. But the legislature has enacted it, it was within its power so to do; be it wise or unwise, we are bound to follow it. The legislature writes the laws, we construe them, and in that construction we are bound to follow the laws as laid down by the legislature, if we can discover what the legislation meant.
In the application claimed in this case to have been submitted to the defendant, as the necessary first step to effectuate the insurance, it is provided:
"Upon payment of the membership fee and the making of the guaranty deposit provided (subject to acceptance of this application by the attorney in fact) the undersigned shall be entitled to membership in FARMERS AUTOMOBILE INTER-INSURANCE EXCHANGE, and to insure one automobile, owned by him, for the kinds of insurance set forth in this application for so long a period as the Exchange shall continue to write such insurance and such applicant shall remain a desirable risk and pay the premiums and other payments required for the renewal hereof."
So, the very application upon which the insurance is based contains therein a notice that as a condition precedent to effecting insurance the membership fee must be paid; second, that it is subject to acceptance by the attorney in fact; third, that upon compliance with these conditions the undersigned shall be entitled to membership in the company, and to insurance on one automobile owned by the applicant for the matters therein set out. It is not claimed by the plaintiff that she paid the guaranty deposit, which *Page 1378
would entitle her to membership. Notice is expressly given in the application that the acceptance of the insurance is subject to the acceptance of the application by the attorney in fact. The claim of the plaintiff is that this was waived by the local office to which the application was made for the purpose of forwarding to the attorney in fact in Los Angeles, California. The question then arises, can the plaintiff claim, where she has absolute notice that she is not to receive insurance or become a member of the company except upon the approval of the attorney in fact, that she did become entitled to all the benefits of that membership because some one, having no further power in this regard than a local soliciting agent, arranged it otherwise? If so, then a contract can be made between the defendant company and the person claiming the insurance in a manner other than that provided in the application itself and the statute under which it organized. The application is simply a proposal to the defendant to be accepted as a member of the corporation, and to be insured under certain conditions. What figure then does section 9103 cut in the matter? Is it applicable? If not, then this defendant, by the statute allowing its organization, can be compelled to enter into a contract by other ways and means than is provided in the proposal made by the party desiring the insurance.
Following the making of the application, under date of July 17, 1933, the plaintiff received a card bearing the Des Moines post office mark of the same date; the card reading as follows:
"July 17, 1933
"Dear Assured: Many thanks for the insurance on your car, effective July 12th. 1933 policy #416058. Your policy will reach you in about 15 days. This is your Company and your practical method of `cutting overhead.' The protection, savings and service of the Exchange are available to you. Thank you.
"Farmers Automobile Inter-Insurance Exchange "Insurance Exchange Bldg., Des Moines, Iowa."
A photograph of the card is attached and made a part of the record upon which the case is heard here. The side upon which the communication is written is in typewriting. The part starting with the heading and running down to and including the words "Thank you" was all evidently written on one typewriter. The words "Farmers Automobile Inter-Insurance Exchange" are apparently *Page 1379
stamped thereon with an ordinary rubber stamp. The words "Insurance Exchange Bldg. Des Moines, Iowa", apparently are stamped thereon with a different stamp from the other. There is no showing in the record of who sent the card. It is claimed that the accident took place on the evening of the 13th of July, 1933. There appears in evidence in the case, on the letterhead of the defendant, a letter addressed to the plaintiff saying:
"Re: Your application — #416058
"Dear Mrs. Gisin: We have received your application for coverage on a 1932 Chevrolet Sedan.
"We appreciate your desire to join the Exchange but regret to advise we have found it necessary to decline your application for insurance.
"No remittance has been received.
"Thank you.
"Very truly yours."
These are all material matters as to what passed between the parties.
Verbal testimony was introduced tending to prove that the local agents of the defendant here assured the plaintiff that she had been insured, and that it would date back to the time of her application. The way of doing business between the company and its patrons was, that the application would be brought in to the local agent; the local agent filled in the application and put a number on it; the number put on would correspond to the number on the policy when issued, but they had no power to bind the company by any representations other than in accordance with the terms of the statute under which the defendant was organized. If the position of the plaintiff in this case can be sustained, then the defendant can be bound by the acts of its local agents under their general powers as such agents, and reliance for this is based upon section 9004 of the Code of 1931. This section is found under "Insurance other than life". It in no way mentions, excepts, or includes organizations under the statute of which the defendant is organized. Hence they are not applicable under the Schmid case hereinbefore cited. Each side made a motion for a directed verdict. The court overruled the motions and submitted the case to the jury simply as to the amount of damages, holding in effect that the defendant was bound by the acts of its agents as to the insurance being in force from the time of the application. *Page 1380
So, on the whole, we conclude that no binding insurance was ever effected between the defendant and plaintiff. That to hold so would be contrary to the statute 9103, and that we must follow because it is the latest legislative declaration on the subject; and the motion of the defendant for an instructed verdict should have been sustained, and the court erred in submitting the case to the jury.
Many other questions have been argued here in this case, but this construction of the statute, and we think it is correct, makes these questions not applicable here. And hence, for the reasons pointed out, the judgment of the lower court is necessarily reversed. — Reversed.
ANDERSON, C.J., and ALBERT, POWERS, RICHARDS, DONEGAN, and HAMILTON, JJ., concur.
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432252/
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I. The property involved in the partition suit was the former homestead of John and Elizabeth Turner, the former of whom held the legal title thereto. John died testate in 1. CONVERSION: 1904, survived by his wife, Elizabeth, and by equitable his four children, parties hereto. The property conversion: in question comprised Lots No. 3 and No. 4 in a reconver- certain Block No. 1 in Iowa City, and had an sion. area of less than one-half acre.
The will of John Turner contained the following:
"I give to my said wife Lot four (4), in Block one (1) situated in Page's Addition to Iowa City, Iowa, absolutely, for her sole use and benefit. I give to my said wife Lot Three (3), in Block One (1) Page's Addition to Iowa City, Iowa, being the lot on which my house and outbuildings are standing on the terms as hereinafter expressed, viz.: That my said wife shall have the sole right and use of said house and outbuildings and lot on which the same are situated until her death — or as long as she remains my widow. * * * Should my said wife remain my widow, after her death I direct the above house and lot to be converted into money and that my said four children shall share equally the proceeds of such sale."
The widow continued her occupancy of both lots as her homestead up until the time of her death, in 1918. The widow was named as executrix in the will. Whether she ever acted as such, or was appointed by the court as such, does not appear in the record. Except as above set forth, she was the sole beneficiary in the will, and there was little occasion for formal action on her part. In 1912, Villhauer obtained a judgment against Clara Watkins for approximately $300. The proceeds in controversy are of the same approximate amount. In August, 1920, the plaintiff, as one of the heirs, brought this suit. Her petition averred the ownership of the property by the four heirs; it averred that the property could not properly be divided in kind, *Page 928
and prayed that it be sold and the proceeds divided; it averred also that Villhauer claimed some interest in the property, but that in truth he had no interest therein; and it prayed that he be barred from claiming any. Such was the petition. Villhauer appeared to the action, but filed no pleading. Clara Watkins did likewise. Each of these parties was represented by counsel. In November, 1920, such counsel entered into the following stipulation on behalf of their respective clients:
"It is hereby stipulated and agreed by and between plaintiff and * * * M. Villhauer * * and Clara A. Watkins that consent is hereby given that judgment shall be entered establishing and confirming the interest of * * * Clara A. Watkins as the one-fourth interest in said property as described in said petition * * * that said property shall be sold by referee and that the proceeds thereof shall be divided into four equal parts * * * and one fourth thereof, being the share of Clara A. Watkins, shall be paid to the clerk of the district court, to be held by him subject to any orders of the court because of certain claimed judgments now of record against her as shown in the records of the clerk of the district court of Johnson County, Iowa, dated November 27, 1920. Signed * * * Wilson, Evans
McClain for Clara A. Watkins, G.W. Ball, Atty., for M. Villhauer. * * *"
Pursuant to this stipulation, the court entered a decree, and appointed a referee to sell. Three years later, and in September, 1923, the referee filed his report, and paid into court one fourth of the proceeds of the sale, as representing the interest of Clara Watkins. In the meantime, and in May, 1922, Clara Watkins had assigned her interest, as before stated, to her three children, who thereafter claimed the same.
The pivotal point in dispute is whether Villhauer's judgment ever became a lien upon the interest of Clara Watkins at any time prior to May, 1922, when the assignment was made to her children. No attack is made upon the validity of the assignment. The claim is that Villhauer had a prior lien. The nature of the controversy differs somewhat in its application to the two lots, No. 3 and No. 4. We shall consider first, therefore, the question of right as applied to Lot No. 3. The contention for appellants is that the will of John Turner worked an equitable conversion of Lot No. 3, whereby the interest of Clara Watkins *Page 929
therein became personalty, and not realty. If this be so, then the judgment did not become a lien upon it. That the will of John Turner did work an equitable conversion of Lot No. 3 is quite settled, under our previous cases. Beaver v. Ross, 140 Iowa 154. If this were all, there would be no question as to the right of appellants to prevail.
But the appellee contends that the maintenance of the partition suit and the stipulation filed therein and the decree entered pursuant thereto worked a reconversion of the property into realty, and that thereby the judgment attached as a lien thereto.
It is well settled that an equitable conversion of realty into personalty may be avoided and in effect set aside and a reconversion into land be accomplished by the joint consent of all the parties in interest, if they be sui juris, and if no trust intervenes.
The question presented is, therefore, whether the proceedings already stated shall be deemed sufficient proof of the agreement or consent of the four heirs to a reconversion of the subject-matter of the will into land. Manifestly, there was no reconversion prior to the bringing of the partition suit. Manifestly, also, the plaintiff, as one of the heirs, could not by her own allegations work such reconversion. For this reason, reliance is placed upon the stipulation. This stipulation in terms recognized "the interest of Clara Watkins as the one-fourthinterest in said property as described in said petition." The essence of the agreement was "that said property shall be sold by the referee and the proceeds thereof divided into four equal parts."
If the stipulation in its terms were otherwise sufficient as an agreement of reconversion, it was still insufficient for that purpose, in that it was signed only by the attorneys of the judgment-creditor, and the debtor, Clara Watkins. Whereas it was requisite that such an agreement should be signed by all the heirs, this was in fact signed by none of them. Norris v. Loyd,183 Iowa 1056. If the position of the appellee can be sustained, it must be upon the theory that the proceeding by partition suit, and taking decree therein, amounted of necessity to a reconversion. That the bringing of such a suit by one heir and acquiescence therein by the others would tend to show an intentional *Page 930
reconversion into land, is to be conceded. But we do not think that such was its necessary effect, or that the proceeding was necessarily conclusive upon Clara Watkins in that respect. It must be observed that the procedure adopted and the relief prayed were strictly consistent with the spirit and purpose of the will. The will had directed that the property be sold and the proceeds divided. It made no provision as to the method by which this should be done. Though the widow was named as executrix, the duty could not devolve upon her to execute the will in this respect after her death. The method adopted by the plaintiff in the suit for the conversion of the property into money was a practical compliance with the provisions of the will, though not technically such. No heir indicated any purpose to retain the land as land. It involves an inconsistency to say that the institution of the partition suit necessarily worked a reconversion into land, when the petition indicated a contrary purpose and prayed for an actual conversion into money. When it is further considered that the stipulation relied on did not purport to settle or adjust any of the ultimate rights of the parties, but rather to maintain the status quo, without prejudice to either party as to such ultimate rights, it becomes still more difficult to find a reconversion. The judgment lien was under challenge. Neither party purported to waive any right as to its ultimate merit. The stipulation described the interest of Clara Watkins in indefinite terms "as the one-fourth interest in said property." Such description was fairly applicable to her interest, whether it be deemed realty or personalty. Which it was, was the very question in dispute. The evident purpose of the stipulation was to postpone the date of argument and of decision without prejudice, and we should not lightly construe it as a complete surrender of her claim.
We reach the conclusion that, under the peculiar facts of this case, it cannot fairly be said that the attempt of the plaintiff herein to convert this property into money necessarily, as a matter of law, worked a reconversion of it into land. It follows that the judgment of the appellee was not a lien upon the interest of Clara Watkins at any time prior to May, 1922, when the assignees acquired the interest of their mother.
II. Our foregoing conclusion becomes quite influential *Page 931
upon the respective rights of the parties as to Lot No. 4. This lot was without question a part of the homestead 2. HOMESTEAD: of Elizabeth, up to the time of her death. She right of died intestate. As a part of her homestead, it surviving passed to her issue, exempt from her debts and children. from antecedent debts of their own. Section 2985, Code of 1897.
The decree below must, accordingly, be reversed. — Reversed.
FAVILLE, C.J., and ALBERT and MORLING, JJ., concur.
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432253/
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Plaintiff and her family had moved from Schleswig, Iowa, to California. Her son-in-law, Melvin Hedberg, who remained temporarily at Schleswig, talked with V.M. Shearman, defendant's agent at Schleswig, about shipping to plaintiff fourteen boxes and crates containing her household goods. Shearman *Page 651
was told Hedberg would write him later where to ship the goods. October 30, 1945, Hedberg wrote Shearman to have the fourteen boxes picked up by the local drayman and to "Ship by freight to Mrs. Harry Stricker, 5122 W. 111th Place Inglewood California, prepaid", and that arrangements had been made with Farmers State Bank, Schleswig, to pay the charges.
The foregoing statement covers all the negotiations between plaintiff and defendant before the goods were shipped. Shearman testified Hedberg left the impression the shipment was to be moved at the cheapest rate. Hedberg testified nothing was said about rates or valuations, and the trial court found no instruction was given Shearman that the goods were to be moved at the lowest rate. Defendant specifically stated it took no exception to that finding.
Shearman advised the drayman, the latter delivered the shipment to defendant November 5, and Shearman billed it out. The following day Shearman presented the original bill of lading to the bank and collected a freight charge of $51.04 (plus tax) shown on it. The bank mailed the bill of lading to plaintiff November 26. The shipment arrived at Inglewood December 1. Plaintiff's husband, Harry Stricker, testified he called for it and was told by the agent there was an "extra cost" of about $26. Stricker paid this and went to the freight house to get the shipment. After Stricker made the payment the agent told him the shipment was two boxes short and handed him a freight bill upon which was written a notation to that effect. It is not contended plaintiff or anyone in her behalf ever signed the bill of lading or any other instrument connected with the shipping.
The two boxes of goods were never located. Plaintiff brought this action and the court rendered judgment against defendant for $850, the value of the lost goods. Defendant had offered to confess judgment for $121.57 and costs, upon the theory its liability was limited to $20 per hundred pounds weight of the lost boxes. Upon this appeal the question is whether defendant's liability was so limited. Section 20(11), chapter 1, of the Interstate Commerce Act, 49 U.S.C. the pertinent statute, states, in part, that any common carrier subject to the statute, receiving property for interstate transportation shall issue a receipt or bill of lading and shall be liable for the loss or damage to the *Page 652
property and no contract or regulation shall exempt the carrier from liability for the full loss: "Provided, however, That the provisions hereof * * * shall not apply * * * to property * * * concerning which the carrier shall have been or shall be expressly authorized or required by order of the Interstate Commerce Commission to establish and maintain rates dependent upon the value declared in writing by the shipper or agreed upon in writing as the released value of the property * * * and any tariff schedule * * * may establish rates varying with the value so declared and agreed upon."
[1] To bring itself within the exception of the proviso limiting liability, the carrier must establish a declaration in writing by the shipper of reduced value of the property or an agreement in writing of released value. Clubb v. Hetzel,165 Kan. 594, 198 P.2d 142, 147; Smith v. Pippin, 188 Va. 869,51 S.E.2d 159, 161. The declaration or agreement need not be signed by the shipper. American Railway Exp. Co. v. Lindenburg,260 U.S. 584, 591, 592, 43 S. Ct. 206, 209, 67 L. Ed. 414, states it is sufficient if the shipper accepts the carrier's bill of lading without himself signing it — "The respondent, by receiving and acting upon the receipt, although signed only by the petitioner, assented to its terms and the same thereby became the written agreement of the parties. * * * Having accepted the benefit of the lower rate dependent upon the specified valuation, the respondent is estopped from asserting a higher value."
[2] I. The bill of lading issued by defendant in the case at bar was on a printed form used by carriers in this section of the United States. It contained the following:
"Note — Where the rate is dependent on value, shippers are required to state specifically in writing the agreed or declared value of the property. The agreed or declared value of the property is hereby specifically stated by the shipper to be not exceeding
PER
_____________________________________________________________."
This was the place provided in the printed form for the writing of the agreed or declared value. The blanks were not filled in. Although a "writing" of the agreed or declared value, *Page 653
required by the statute, would not be invalid because not made in the space provided therefor, a "writing" out of context at another place in the bill of lading to be effective should be reasonably clear. A heading printed on the bill of lading was entitled:
"DESCRIPTION OF ARTICLES, SPECIAL MARKS AND EXCEPTIONS."
Under this heading in typewriting was:
"Personal effects HHGds
Rel @ 20.00 cwt
1 bbl 1 crate 1 chest locked 11 fib crtns 14 pcs."
The "writing" relied upon by defendant is "Rel @ 20.00 cwt".
Plaintiff contends this language is insufficient to comply with the statute. It is not a common expression, nor is its meaning generally understood. Defendant deemed it necessary to explain such meaning to the court by the testimony of Shearman "the letters * * * meant released at $20.00 per hundredweight." However, no explanation was made to the housewife-consignee or her son-in-law, who was listed as shipper, neither of whom was shown to have had any special knowledge of shipping. They should not be bound by cryptic symbols whose meaning is unintelligible to the average shipper.
Missouri-Kansas-Texas R. Co. v. King, Tex. Civ. App., 265 S.W. 761, 762, is here in point. The decision states:
"The contract of shipment, nor any other evidence, showed that appellee had declared in writing, or agreed upon in writing, that the property was of a certain value. There was no evidence which brought the contract of shipment within the provisions of the federal statute. No value was placed in the body of the contract, and nothing was indicated therein, as to the value of the property. The unintelligible words, `Rel. Val. 10.00 per cwt.' would not meet the demands of the statute as to a declaration of value."
Norfolk Western Ry. v. Harman, 104 Va. 501, 506, 52 S.E. 368, 370, in which the writing was "Rel. Val. Lts. (or Ltd.) *Page 654
5 cwt.", states: "* * * it cannot be said that their meaning was discernible to a person of ordinary intelligence."
It may be noted that in Kansas City Southern Ry. Co. v. Carl,227 U.S. 639, 33 S. Ct. 391, 57 L. Ed. 683, and also in Tuller v. Chicago, R.I. P.R. Co., 186 Iowa 1070, 1078, 168 N.W. 301, the abbreviated legend was merely intended to refer to or connect with a formal written contract of release in regular form. In the case at bar the symbols were the only "writing" and are relied upon as constituting the contract itself.
We hold the expression "Rel @ 20.00 cwt" under the heading "DESCRIPTION OF ARTICLES" etc. was insufficient to constitute a declaration of value or an agreement fixing the released value of the property, within the requirements of the statute.
[3, 4] II. Defendant states plaintiff was presumed to know the tariffs and the limitations of values based thereon and it contends that, having accepted the benefit of the lower rate dependent upon the specified valuation, plaintiff was estopped to assert a higher value. The premise upon which the contention is founded is not sustained by the record. The goods were billed out by defendant without any disclosure, suggestions or instructions by plaintiff or Hedberg concerning valuations or rates. In the absence of such disclosure defendant had a right to assume that the higher of the rates based upon valuation was applicable. Kansas City Southern Ry. Co. v. Carl, 227 U.S. 639, 33 S. Ct. 391, 57 L. Ed. 683. There had been no course of dealings between the parties which would justify defendant in selecting a reduced rate. The bill of lading listed the rate of "545" and the freight charge at $51.04. This $51.04 figure was incorrect for a rate of "545", but the bank paid it. The actual and apparent authority of the bank seems to have been limited to paying whatever shipping charge defendant presented. Plaintiff never saw the bill of lading until about the time the goods arrived at Inglewood.
About December 4 plaintiff was notified the goods had arrived. Mr. Stricker called for them. He was told there was an extra cost of about $26. After he paid this he was handed the freight bill and was told of the loss of the two boxes. This freight bill had been made out by the carrier December 1, after the goods reached Inglewood with the two boxes missing. It showed a *Page 655
freight rate of "681." Defendant's evidence showed the "545" rate listed on the bill of lading of November 5 was erroneous. If this figure did not express the intent of and did not bind the carrier it should not serve to inform the shipper or limit her rights.
The trial court characterized the procedure of defendant at Inglewood as "an effort on the part of the company to contract for a limited liability after the loss had occurred and its liability had arisen, with knowledge of such loss on the part of the company and with no knowledge thereof on the part of the shipper." In a case of this kind the shipper's rights must be determined by what transpired before the goods were lost. Hunter v. American Railway Exp. Co., Mo. App., 4 S.W.2d 847. As pointed out in Caten v. Salt City Movers Storage Co., 2 Cir., N Y, 149 F.2d 428, 432, a conversation respecting valuation, held after the goods were destroyed was "too late, of course, to count as a valuation upon which the rate was based."
The facts appearing in the record bring this case within the rule of the Caten case, in which no bill of lading or receipt was delivered to the shipper, although, following a telephone conversation, the carrier had made out a bill of lading in which the valuation was limited. This was destroyed when the van carrying the goods and its contents were burned. The decision states (149 F.2d at page 432):
"The statute makes it abundantly clear that the carrier's common law liability for full actual damages * * * is imposed when it accepts goods for carriage, unless a certain specified agreement limiting that liability has been made as the result of an equally certain specified action by the shipper in respect to a voluntary valuation of his goods. * * * Here nothing was done by the shippers which amounted to written action by them as to valuation, and any agreement limiting the defendant's liability to less than the actual value was void. Therefore * * * the defendant was liable for the full value of the plaintiffs' goods."
In Smith v. Pippin, 188 Va. 869, 874, 51 S.E.2d 159, 161, after the shipper knew of the damage, the blank form on the bill of lading, declaring a value of not exceeding thirty cents *Page 656
per pound, was signed by him with his notation written thereunder, "`Insurance not adjusted for damages of furniture beyond repair'" and on the driver's copy "`just signing for driver.'" Although he was familiar with reduced rates and limited recovery clauses, he paid the charges for transportation at the lower rate after the loss, explaining it was demanded by the driver upon delivery as required by the bill of lading. A judgment for the full amount of the damages was affirmed on substantially the same reasoning as in the Caten case. Clubb v. Hetzel, 165 Kan. 594, 198 P.2d 142, involves a somewhat similar factual situation. The court held the carrier had not met the burden imposed upon it to place itself within the exception of the statute by establishing a contract limiting its liability.
Loeb v. Friedman's Express, 187 Misc. 89, 94, 65 N.Y.S.2d 450, 454 (affirmed 271 A.D. 873, 66 N.Y.S.2d 634, appeal granted 271 A.D. 916, 67 N.Y.S.2d 690, affirmed 296 N.Y. 1029, 73 N.E.2d 906, certiorari denied Friedman's Express v. Loeb, 331 U.S. 851, 67 S. Ct. 1743, 91 L. Ed. 1859) states:
"In order to sustain a limitation of liability in this case we should be obliged to go beyond the earlier cases and to hold that where a bill of lading in the form here used, received by the shipper and signed by him, contains a legend calling for the declared value to be stated by the shipper, which value is not inserted, that in itself is tantamount to a declaration in writing of the value of the shipment on the basis of the minimum tariff. The statutory language has no such meaning."
We agree with the conclusion of the trial court that the fixing of the rate by defendant after defendant knew of the loss and the subsequent collection of the unpaid amount of the tariff based thereon were insufficient to bind plaintiff or estop her from recovering the full value of the lost goods. — Affirmed.
HAYS, C.J., and SMITH, BLISS, GARFIELD, MANTZ, and MULRONEY, JJ., concur. *Page 657
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432264/
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[1] The facts are not in dispute. The controversy arises over the application of the provisions of this statute to the situation before us. The Commission contends that the employment relation of the appellee and Brumbaugh was such that the latter was within the benefit coverage of the statute, while it is the contention of the appellee that Brumbaugh was not its employee, in the common acceptation of that term, but was an independent contractor, and therefore excluded from the provisions of the act.
The appellee is an Iowa corporation, with its office and place of business in Des Moines, and is engaged in publishing two magazines, one of which is Successful Farming. This publication has a very large number of subscribers. To obtain and retain subscribers it employs agents to solicit subscriptions on a commission basis. On or about June 20, 1938, Brumbaugh signed a written application to appellee for his appointment as an agent only to solicit subscriptions for Successful Farming on a commission basis. This application provided that the applicant agreed to comply with the provisions of the agency contract, and to solicit subscriptions pursuant to the contract and in accordance with printed forms to be furnished him by the appellee. The application also stated that Brumbaugh agreed to correctly account each day for all subscription payments received.
On the same day an agency contract was executed by Brumbaugh and by Speckman, branch manager of the appellee. It provided that: Brumbaugh was to solicit subscriptions to *Page 669
Successful Farming in accordance with subscription offers issued by the company during the term of the contract; nothing in the contract should be construed as creating the relation of employer and employee between the agent and the company or its branch manager; "Said subscription agent shall be free to exercise his own judgment as the time, method, manner, and place of solicitation but The Company or its Branch Manager may from time to time prescribe such rules and regulations respecting the conduct of the business, not interfering with such freedom of action of the subscription agent and which rules and regulations shall be observed and conformed to by him. * * * The Company may prescribe the form, plan, and terms governing all subscriptions solicited and may, from time to time, change, modify, or discontinue any subscription plan or plans or the terms governing the same"; the authority granted to the agent is limited solely to the solicitation of subscriptions to the company's publication, for which he shall be entitled to the retention of commission for each subscription secured by him at the rate now or hereafter fixed by the company; he shall keep, on the forms furnished, correct records of all subscriptions secured by him and report thereon as required; the contract and no rights therein shall be subject to assignment by the subscription agent; the contract can be terminated by either party at any time without assigning any cause or giving any prior written notice.
It was the plan of the company to send a number of these agents into a city or town, of suitable location, so that the entire county could be thoroughly canvassed for subscribers. One of their number, experienced in the work, was placed at the head of the group, although he was merely a solicitor of subscriptions operating under an agency contract as set out above. He would assign to each solicitor a rural mail route to be canvassed by that solicitor alone. It usually took from a week to two weeks to work a mail route. The agents were asked to contact at least 70 per cent of those on the mail route. Each agent took with him subscription blanks furnished by the appellee. One copy was given to the subscriber, and one copy was retained by the agent for the appellee. All subscriptions were for cash and no credit was extended. Each agent was required to *Page 670
furnish his own transportation over the route, and to pay the expense thereof, and also for lodging, food, and all other expenses. Each night he accounted to the solicitor in charge of the group for all subscriptions taken during the day. He gave to him the signed subscription orders, and after retaining as his commission 80 per cent of each subscription, he delivered to him the remaining 20 per cent thereof. He also reported to him the number of hours he worked each day or whether he worked at all. The agent was at liberty to work only such time as he wished and when he wished, although the branch manager and the solicitor in charge suggested to them that they put in eight hours a day and impressed upon them that the more diligently they worked the more money they would receive. A bonus was paid if an agent sold over 60 subscriptions in a week. Each agent was required to confine himself to the mail route assigned to him. He made no report as to those upon whom he made calls. At times he did not solicit 70 per cent of the route patrons. The only remuneration he received was the commission retained by him. He traveled his route alone and was not directed, supervised, or controlled by anyone in doing this. The agents were assigned separate mail routes so that there would be no conflict in their canvassing. The solicitor in charge received the same commission as the others for each subscription, and a small percentage of the subscriptions procured by the others for the service which he rendered the appellee. No deductions were made by the appellee from the earnings of any agent, nor was any part of the Social Security Act taxes paid therefrom. The agents sold no subscriptions for any publication other than Successful Farming. There was never any discussion about their selling any other subscriptions.
Brumbaugh, before taking this job, had done some work for road-building contractors in Iowa and Kansas. After he signed the contract with appellee, he was given a three-day course of instructions respecting the method of securing subscriptions. The branch manager went with him one day. The solicitor in charge traveled with him one day, and the latter's son went out with him once. Occasionally the solicitor in charge, sometimes referred to as the crew manager, or the branch manager, would give the agents a sales talk. *Page 671
The same general method which we have outlined was followed in each county. The group canvassed several counties. Brumbaugh worked about three months. His commissions were $300. There is nothing in the record as to how many hours he put in each week, excepting for the last two weeks. During the next to the last week he worked 12 hours and procured 26 subscriptions, for which he retained as commissions $20.40. He should have remitted $5.10, which he did not do, but he claimed he was entitled to hold it out. During the last week he worked 19 hours and produced five subscriptions, and made no remittance to the company. Other solicitors of the group during these two weeks worked an approximate average of 30 hours a week. Brumbaugh voluntarily gave up his contract and quit work wholly of his own accord. He gave as a reason for his quitting that his expenses exceeded his receipts. Francisco, the solicitor in charge of this particular group, had been soliciting subscriptions for the appellee on a commission for over seven years.
We have set out substantially all of the evidence. There is no evidence that anyone connected with the appellee exercised any control over Brumbaugh in the performance of the services which he agreed to perform, or that anyone exercised any direction or control over him in his daily work of canvassing his territory, or any detail of that work. His physical efforts were not controlled, nor the time, place, method, or character of his work. He did nothing but solicit. No other work of any kind was performed by him for the appellee. His earnings depended very largely upon his own efforts. This is apparent from the amount of money which he received during the few hours he worked during his last two weeks. Not only did the appellee exercise no control over him in fact, but there is no evidence that it had any right to exercise control over him. Whatever direction, supervision, or suggestions which it gave to him were with respect to the general result to be accomplished. Of course, the appellee was interested in retaining and increasing the number of its subscribers. It was interested in the diligent effort and efficiency of its subscription agents to accomplish that end by contacting prospects in every county as widely and as *Page 672
effectively as possible. It had a right to plan the most effective campaign to that end, and fix the terms of subscription. Such plans are in no way different from the plans and specifications of an owner who lets a lump-sum building contract to an independent contractor to furnish the material and labor to construct a building. Such a one may have an architect supervise the work, or may make suggestions, or see to it that the work is done properly or according to the plans, but the builder, nevertheless, is an independent contractor. There is nothing in the record which has the slightest tendency to establish that the appellee exercised or had the right to exercise the control or direction over this agent in the solicitation of subscribers which the employer or master exercises or has the right to exercise over his servant.
[2] I. The principles of law applicable to this proposition are so uniformly recognized everywhere, and have been so many times clearly and definitely announced by this court, that extended discussion would be out of place.
In Arne v. Western Silo Co., 214 Iowa 511, 516, 242 N.W. 539, 542, a compensation case, claimant sold products on a commission, using his own car, paying his own expenses, and working when he pleased. Either party to the contract might cancel it at any time. In holding that he was an independent contractor, we said:
"An independent contractor within the generally accepted legal definition of the term is: a person who in the pursuit of an independent business, undertakes to do specific work for another person, using his own means and methods, without submitting himself to the control of such person in respect to all of its details. An independent contractor represents the will of his employer only as to the result of his work, and not as to the means by which it is accomplished."
In Pace v. Appanoose County, 184 Iowa 498, 508, 168 N.W. 916, 919, a compensation case, we defined an employee to be a person bound to the duty of service, subject to the command of his master, as to the manner in which he shall do his work. In the same case, quoting from 1 Labatt's Master Servant, 2d Ed., section 64, we approved the following statement: *Page 673
"`The accepted doctrine is that, in cases where the essential object of an agreement is the performance of work, the relation of master and servant will not be predicated, as between the party for whose benefit the work is to be done, and the party who is to do the work, unless the former has retained the right to exercise control over the latter, in respect to the manner in which the work is to be executed. This attribute of the relation supplies the single and universally applicable test by which the servants are distinguished from independent contractors.'"
We call attention to a few of our decisions supporting these statements of the law. See Storm v. Thompson, 185 Iowa 309, 170 N.W. 403, 20 A.L.R. 658; Norton v. Day Coal Co., 192 Iowa 160, 180 N.W. 905; Humpton v. Unterkircher, 97 Iowa 509, 66 N.W. 776; Root v. Shadbolt Middleton, 195 Iowa 1225, 193 N.W. 634; In re Estate of Amond, 203 Iowa 306, 210 N.W. 923; Burns v. Eno,213 Iowa 881, 240 N.W. 209; Page v. Koss Constr. Co., 215 Iowa 1388, 245 N.W. 208; Johnson v. Selindh, 221 Iowa 378, 265 N.W. 622; Ash v. Century Lbr. Co., 153 Iowa 523, 133 N.W. 888, 38 L.R.A., N.S., 973; Arthur v. Marble Rock Consol. Sch. Dist., 209 Iowa 280, 228 N.W. 70, 66 A.L.R. 718; Svoboda v. Western Fuel Co., 195 Iowa 1137, 193 N.W. 406; Lang v. Siddall, 218 Iowa 263, 254 N.W. 783.
Such interest as the appellee manifested and such attention as it gave to the work of its agent was wholly consistent with the independent-contractor relation of Brumbaugh. It was clearly within the principle so well stated by the Tennessee court in Odom v. Sanford Treadway, 156 Tenn. 202, 209, 299 S.W. 1045, 1046, and quoted in Grace v. Louisville N.R. Co., 19 Tenn. App. 382, 388, 89 S.W.2d 354, 358, to wit:
"`As a practical proposition, every contract for work to be done reserves to the employer a certain degree of control, — at least to enable him to see that the contract is performed according to the specifications. The employer may exercise a limited control over the work without rendering the employee a mere servant, for the relation of master and servant is not inferable from the reservation of powers which do not deprive the contractor of his right to do the work according to his own initiative so long as he does it in accordance with the contract. *Page 674
* * * Thus a person employed to perform certain work is not necessarily a mere servant because the contract provides that the work shall be subject to the approval or satisfaction of the employer. Such a provision is not an assumption by the employer of the right to control the employee as to the details or methods of doing the work, but is only that the employer may see that the contract is carried out according to the plans.'"
The terms "master," "servant," and "independent contractor" are thus defined in volume 1 of Agency in the American Law Institute's Restatement of the Law, section 2:
"(1) A master is a principal who employs another to perform service in his affairs and who controls or has the right to control the physical conduct of the other in the performance of the service.
"(2) A servant is a person employed by a master to perform service in his affairs whose physical conduct in the performance of the service is controlled or is subject to the right to control by the master.
"(3) An independent contractor is a person who contracts with another to do something for him but who is not controlled by the other nor subject to the other's right to control with respect to his physical conduct in the performance of the undertaking."
Section 220 of the same volume sets out a number of matters of fact which are of significance and to be considered in determining whether one is a servant or an independent contractor. Some decisions from other jurisdictions, which support the holdings of this court as exemplified by its decisions cited above, and which are ably written and instructive, are: Stockwell v. Morris, 46 Wyo. 1, 22 P.2d 189; McCarthy v. Souther, 83 N.H. 29, 137 A. 445, 450; Mitchell v. Maytag Pacific-Intermountain Co., 184 Wash. 342, 51 P.2d 393; James v. Tobin-Sutton Co., 182 Wis. 36, 195 N.W. 848, 29 A.L.R. 457; American Nat. Ins. Co. v. Denke, and American Nat. Ins. Co. v. Shepherd, 128 Tex. 229, 95 S.W.2d 370, 107 A.L.R. 409; Leachman v. Belknap Hdwr. Mfg. Co., 260 Ky. 123, 84 S.W.2d 46; American Sav. L. Ins. Co. v. Riplinger, 249 Ky. 8, *Page 675 60 S.W.2d 115; Income L. Ins. Co. v. Mitchell, 168 Tenn. 471,79 S.W.2d 572; Manus v. Kansas City Distr. Corp., 228 Mo. App. 905, 74 S.W.2d 506, 510; Wesolowski v. John Hancock Mut. L. Ins. Co.,308 Pa. 117, 162 A. 166, 167, 87 A.L.R. 783; Neece v. Lee,129 Neb. 561, 262 N.W. 1; Aldrich v. Tyler Grocery Co., 206 Ala. 138,89 So. 289, 17 A.L.R. 617; Ignatowitch v. McLaughlin, 66 N.D. 132,262 N.W. 352; Kassela v. Hoseth, 217 Wis. 115, 258 N.W. 340; Khoury v. Edison Elec. Illum. Co., 265 Mass. 236, 164 N.E. 77, 60 A.L.R. 1159; Harrington v. Lee Mercantile Co., 97 Mont. 40,33 P.2d 553; Dohner v. Winfield Wholesale Groc. Co., 116 Kan. 237, 226 P. 767; Gall v. Detroit Journal Co., 191 Mich. 405, 158 N.W. 36, 19 A.L.R. 1164; Barton v. Studebaker Corp., 46 Cal. App. 707,189 P. 1025; American Nat. Ins. Co. v. Kennedy, Tex. Civ. App., 101 S.W.2d 825; Shell Petroleum Corp. v. Linham, Miss., 163 So. 839; Peters v. California Building-Loan Assn., 116 Cal. App. 143,2 P.2d 439; 1 C.C.H. Unemployment Insurance Service 3704, paragraph 8716; Luckie v. Diamond Coal Co., 41 Cal. App. 468, 480,183 P. 178, 183; Kneeland-McLurg Lbr. Co. v. Eder, 196 Wis. 402, 220 N.W. 199; State ex rel. Sexauer Mfg. Co. v. Grimm, 217 Wis. 422, 259 N.W. 262; In re Binder, 259 A.D. 1103, 21 N.Y.S.2d 369; C.C.H. Missouri Unemployment Insurance Service, 28034.
II. While the appellants forcefully argue that such direction as the appellee used in the work of Brumbaugh was, at least, kindred to that used by an employer, the meat of their argument is based upon the theory of coverage stated in the following grounds for reversal, to wit:
"1. Decisions defining and fixing various relations under the common law are not relevant, nor do they establish or limit the boundaries of the statutory relationship of `employment' created by the Iowa Employment Security Law.
"2. The Commission did not err as a matter of law in holding Brumbaugh to be an individual in `employment' because the Iowa Employment Security Law creates an employment relationship broader in scope and coverage than the common law relationships of employer-employee-independent contractor." *Page 676
Before discussing the respective contentions of the parties, it may be helpful to refer to the pertinent provisions of this Employment Security Law, its purpose, its historical background, and its relationship to congressional legislation which set the pattern for similar state enactments, although there had been some earlier state pioneering. Federal legislation was adopted imposing a pay-roll tax upon employers, but providing that when any state enacted mandatory unemployment-insurance legislation which complied with certain minimum standards specified in the congressional legislation, then the contributions paid by employers to their employees would be credited up to a certain percentage (90 per cent) as an offset against the federal pay-roll tax. Because of this device, which enabled the employer to keep at home, for the unemployment relief of his wage earners, nine tenths of this excise tax which otherwise would have gone to Washington for general spending, within a period of two years after the enactment of the Social Security Act, fifty states and outlying possessions passed unemployment insurance or compensation legislation. The Federal Unemployment Tax Act, 26 U.S.C. Int. Rev. Code, section 1600 et seq., does not prescribe a system of unemployment compensation or employment security, but leaves to each state the privilege of working out its own legislation so long as it complies with certain minimum standards and requisites specified in the federal act, on which the social security board bases its approval. This board also is in a position to exercise and enforce regulatory powers over state legislation. There is a close general interrelation maintained between the federal and state legislation on this subject matter with respect to its provisions and purposes. But what we are chiefly interested in is the nature and scope of the employment relationship which is the basis for the tax of the employer, and the benefit contributions, and coverage. Both the federal unemployment tax and the state unemployment-compensation contributions are based on wages paid or payable for employment and are applicable only to those between whom there exists an employment relation.
[3] The law of employment, the status of employer and employee, had its origin in the relationship of master and servant, under which the servant performs services for wages or other *Page 677
remuneration under a contract of hire. It is this common-law conception of the employment relationship which has been carried into and made a part of the federal legislation such as the Social Security Act and the Federal Unemployment Tax Act. This relationship between the individual who performs such services and the individual or organization for whom he performs them must be the legal relationship of employer and employee. If such an individual is subject to the control of the one for whom the services are performed, merely as to the result to be accomplished by the work and not as to the means, methods, and manner of accomplishing the result, he is an independent contractor and not an employee. This is the construction of the employment relationship under these federal acts which the bureau of internal revenue and the social security board have placed upon them. Under their rulings, if the individual performing the services is, in fact, free from direction and control over the manner of the performance of his services, he is excluded from the coverage of this particular congressional legislation. In the 4th Edition (1940) of the "Foundation Guide for Payroll Taxes," by Kixmiller and Christie, page 89, is this statement:
"The federal regulations adopt the attitude of the common law on the employment relationship; namely, that although other elements may be important, the determining element in fixing the employment relationship is the right of control. All the states are in accord on this proposition but in addition most state laws have included two other elements to serve as coordinates with the `right of control' in determining the existence of an employment relationship. The usual provision of coverage in the state laws reads as follows:
"`Employment means all service for remuneration unless — (1) the individual performing the service is free from control over the manner and method of performance; (2) the service is either outside the usual course of the business for which such service is being performed or else it is performed outside of all the places of business; and (3) the individual performing the services is engaged in an independent trade, occupation, profession or business.' *Page 678
"At common law an individual who performed personal services and was not an employee was called an independent contractor. It is to be noted that none of the state laws mention the phrase `independent contractor' but speak only of `employment' as defined in the law."
On pages 195 and 196 of the same book is the following:
"Section 1607 (c) of the Internal Revenue Code defines employment as any service of whatever nature, performed within the United States by an employee for his employer. From this definition it can be seen that the Act imposes the tax only on the employment relationship as that is known at common law. The regulations make this even clearer by the use of the following language:
"`An individual is in the employ of another within the meaning of the Act if he performs services in an employment as defined in Section 1607 (c). However, the relationship between the individual who performs such services and the person for whom such services are rendered must, as to those services, be the legal relationship of employer and employee. * * *'
"`Generally the relationship (that of employer and employee) exists when the person for whom services are performed has the right to control and direct the individual who performs the services, not only as to the result to be accomplished by the work but also as to details and means by which that result is accomplished. That is, an employee is subject to the will and control of the employer not only as to what shall be done but how it shall be done.'"
[4] It will be noted that these definitions and interpretations are in strict accord with the pronouncements of this court on the employer-employee-independent-contractor relationship. Under these definitions and statutory constructions, independent contractors are not to be considered "in employment," and the services they perform are excluded in determining whether the employer has a sufficient number of individuals in employment to be subject to the pay-roll tax, and for the computation of its amount.
It is true that most of the states, in the enactment of *Page 679
unemployment compensation laws, have, by the terms thereof, sought to narrow the separation and distinction between employee and independent contractor, and have made the coverage of their legislation broader in this respect than the federal law. But Iowa has not seen fit to do so. It has so worded this particular section of the statute as to conform to the conception of the above-noted federal boards, to the common-law conception of employer-employee-independent-contractor relationship, and to the pronouncements of this court and of every other court with respect thereto. It has made the factor of control or direction of the performing individual dominant.
Section 1551.25 (G)6, Code, 1939, which was in effect at the times pertinent to this cause, reads thus:
"Services performed by an individual for wages shall be deemed to be employment subject to this chapter unless and until it is shown to the satisfaction of the commission that
"(a) such individual has been and will continue to be free from control or direction over the performance of such services, both under his contract of service and in fact."
Other states, somewhat less than forty in number, have added two additional conditions to the burden imposed upon the employer, which are not in the Iowa statute. A statute, Illinois Revised Statutes, 1941, chapter 48, section 218 (f) (5), which is typical of all of these is as follows:
"(5) Services performed by an individual shall be deemed to be employment subject to this Act unless and until it is proven in any proceeding where such issue is involved that —
"(A) Such individual has been and will continue to be free from control or direction over the performance of such services, both under his contract of service and in fact; and
"(B) Such service is either outside the usual course of the business for which such service is performed or that such service is performed outside of all the places of business of the enterprise for which such service is performed; and
"(C) Such individual is engaged in an independently established trade, occupation, profession or business."
It was not necessary for the appellee to meet any but the *Page 680
first condition, and it appears to us that it did this without any question. While not required to, it also met the second condition. There was also no obligation upon it to satisfy the commission as to the third condition, but it seems to us that it also did this. For, though Brumbaugh apparently was not engaged in any independently established trade, profession, or business, his occupation was in no way connected with the printing or publishing business.
The appellants give us no definite principle or rule of law, or legal guide, or yardstick to determine when one performing service is or is not within the coverage of the statute. They simply say that decisions defining and fixing various relations under the common law are not relevant, nor do they establish or limit the boundaries of coverage under the statute, since the employment relationship is broader in scope and coverage than the common-law relationships of employer-employee-independent contractor. But all this is very indefinite. It marks out no clear-cut standard. It places no limitation or stopping place to this scope of coverage. In fact, it leaves the delimitation solely to the whim, inclination, or view of the tribunal and its personnel at any particular time. It violates the sound and time-honored principle that ours is a government of laws and not of men.
[5] We have a number of well-defined canons of statutory construction. In Jefferson County Farm Bureau v. Sherman,208 Iowa 614, 618, 226 N.W. 182, 184, one of them is stated thus:
"It is also a well recognized rule of construction that the legislative intention is to be deduced from the language used, and the language is to be construed according to its plain andordinary meaning." (Italics ours.)
Of course, the legislature may expressly define the meaning of any term in a statute in a sense different from its accepted meaning. Equitable L. Ins. Co. v. Iowa Employment Sec. Comm.,231 Iowa 889, 2 N.W.2d 262, 139 A.L.R. 885. It has not done so in the Iowa Employment Security Law. Why, then, should the words "employment" or "employee" be given any *Page 681
other than their plain, ordinary, and accepted meaning, and as uniformly declared by this court and other courts?
Kansas, Massachusetts, and Texas, like Iowa, limit the statutory conditions or tests above referred to, to the single factor of direction or control of the worker in the performance of service. Connecticut, New York, Mississippi, and Kentucky, in their unemployment-compensation statutes, expressly designate the employment relation as that of the common-law relationship of master and servant, or employer and employee. The states of Wisconsin, Nebraska, Missouri, Wisconsin, Wyoming, and Tennessee all have the statutory provision with the typical three tests or conditions which we have set out above, yet the courts of those states, in construing these unemployment-compensation statutes, have adopted the common-law definition of employee as distinguished from independent contractor, and have denied coverage where the performer of the service came within the accepted status of an independent contractor. See Wisconsin Bridge Iron Co. v. Industrial Comm., 233 Wis. 467,290 N.W. 199; Central Wisconsin Tr. Co. v. Industrial Comm., 236 Wis. 496,295 N.W. 711; Hill Hotel Co. v. Kinney, 138 Neb. 760, 295 N.W. 397; Unemployment Compensation Comm. v. Mathews, 56 Wyo. 479,111 P.2d 111; Meyer Co. v. Unemployment Comp. Comm., 348 Mo. 147, 152 S.W.2d 184; Texas Co. v. Bryant, 178 Tenn. 1,152 S.W.2d 627, 178 Tenn. 680, 163 S.W.2d 71; Fuller Brush Co. v. Industrial Comm., 99 Utah 97, 104 P.2d 201, 129 A.L.R. 511; S.S.T. 279, Internal Revenue Bulletin, 1938-15-9294.
We call attention also to what the counsel for the Delaware Commission said of this matter:
"The three conditions contained in Section 2 (i)(5) of the law (Del. Sec. 4012) are probably intended to define the relation of employer and employee for the purpose of clarifying it in doubtful or `borderline' cases. The statutory language creates a prima facie presumption that all persons who perform services for wages, including commissions, are to be regarded as employees until the contrary is shown. In my opinion these three conditions were not intended to enlarge the legal conception of employer and employee, or of master and servant, *Page 682
already established by a line of court decisions, nor to create a new and special group of persons to be treated as employees or servants for the purpose of the Unemployment Compensation Act although they would not be employees or servants within the meaning of the previously existing law on that subject." Volume 2, C.C.H. Unemployment Insurance Service 11519, paragraph 8026.
The appellants insist that the legislature, in the statute under consideration, so defined "employment" as to definitely serve as a basis for the extended coverage for which they contend. We find no support for such assertion.
[6] Appellants also argue that the common-law conception of the master-and-servant or employer-and-employee relation is based upon the respondeat superior doctrine, and that such conception has no place in a statute of this kind. Whether or not that doctrine is the basis for the distinction between a servant and an independent contractor is of no materiality, but it is highly material and important that this distinction be retained in construing the terms "employment" and "employee" in this statute. We think the Iowa Legislature had a definite purpose in making the factor of direction or control of the worker in the performance of his service the test of coverage. In other words, if the worker was subject to such direction or control, he is within the statute, and if he is not so subject, and is an independent contractor, then he is excluded from the statute. There is wisdom in such a provision and it is in keeping with the purpose of the legislation.
Let us look at the guide for interpreting chapter 77.2 of the 1939 Code, as set out in section 1551.08 thereof. As therein stated, the economic evil sought to be destroyed or remedied is that arising from "involuntary unemployment." Relief is sought for persons "unemployed through no fault of their own." In other words, forced unemployment. Such unemployment is found among those workers, servants, and employees whose time and labor is under the direction, control, and supervision of the employer — those who labor only as and when the master says they may do so. The Iowa statute has no application to the person who is an independent contractor whose time and whose *Page 683
labor are within his own control. He can accept a contract or decline it. He can work or quit work, just as Brumbaugh could, and did.
Factors and brokers who sell upon commission are uniformly held not to be within the coverage of such statutes. The same is true of salesmen who sell upon commission and without direction or control with respect to the details of the performance of their work. Such workers are the masters of their own time and efforts. The commissions in many states have excluded insurance agents from coverage, and ten or more states by provision of statute have excluded therefrom various types of insurance solicitors and agents. This is the ruling also of the bureau of internal revenue.
Appellee states in its opening printed argument that it understands that the internal revenue bureau ruled that commission-subscription salesmen of Crowell Publishing Company, P.F. Collier Sons Corporation, Periodical Sales Co., Inc., McCall Corporation, and Women's Home Companion Reading Club are not employees within the meaning of the Social Security Act. They also state that pending the proceedings in this case, the internal revenue bureau, on July 18, 1939, ruled that the subscription agents and crew managers of the appellee are not employees of the company within the meaning of the taxing provisions of Titles VIII and IX of the Federal Social Security Act, 42 U.S.C. § 1001 et seq., 1101 et seq., and that in the opinion of the bureau, the appellee neither exercises nor has the right to exercise over the services performed by such individual the control and direction as is necessary to establish the relationship of employer and employee. The appellants, in their reply argument, do not dispute these statements.
The Iowa Commission has, itself, excluded insurance agents from the coverage of this statute. (Volume 2, C.C.H. Unemployment Insurance Service 18517, paragraph 8015.) On January 3, 1938, Mr. Crawley, counsel for the Iowa Commission, gave a written opinion so stating to the Equitable Life Insurance Company of Iowa, with respect to its general agents, soliciting agents, and brokers engaged in soliciting life insurance on a commission basis. In this opinion it quotes section 1551.25 (G) 6, *Page 684
of the Code, which we have set out. It refers, in support, to some authorities we have cited. It states:
"In determining whether or not the individuals in question are in `employment', it is, therefore, not only necessary but proper to consider the rules of law and decisions of the courts as to what constitutes direction and control. In doing so, the thought is kept in mind that the language of the section has for its intent control and direction over the performance of the service and not the result of the performance of such service. This would seem to be inescapable conclusion from even a hasty examination of the section. The burden of proof is upon the applicant (company) to overcome the statutory presumption, but this is met by showing in any case that the performance of service is free from direction and control both as a matter of contract and in fact. * * *
"In view of these findings, the services performed by the general agents, soliciting agents and brokers of the Equitable Life Insurance Company of Iowa are deemed not to be in employment subject to the Iowa Unemployment Compensation Law."
In view of these rulings, we see no reason why a distinction should be made between such solicitors and Brumbaugh.
Appellants in argument state:
"The whole philosophy of the act demands that its coverage be broadened beyond age-old common-law relationships of master and servant, that coverage be extended to all individuals to whom involuntary unemployment is a threat and to all employers, and industry in general, upon whose shoulders rest the burden of economic insecurity."
It is not for us to pass upon the soundness of this economic philosophy. But, it is our duty to say that it is far beyond the purpose and scope of the Iowa Employment Security Law. This law was never intended to, and does not, extend "to all individuals to whom involuntary unemployment is a threat." By its express terms, it excludes hundreds of thousands of those who labor but who are as much exposed to the "serious menace to their health, morals and welfare," due to the economic insecurity *Page 685
of unemployment, as those who are included. To begin with, it applies only to those employers who have eight employees over a specified period. Those groups of employees of less than eight, under any humanitarian philosophy, are no less entitled to employment security than the larger groups. The federal acts, except that of the District of Columbia, and the unemployment-compensation acts of every state, including Iowa, expressly exclude that great body of laborers described as "agricultural or farm labor" with all of its varied classifications. Also excluded is that multitude who are engaged in domestic service in and about the home — the cooks, maids, butlers, valets, laundresses, yardmen, gardeners, janitors, and chauffeurs of family automobiles. In addition to these, there are several other groups of workers who are expressly excluded by the Iowa statute. There is also the vast number of self-employed. All of the millions who are thus excluded are as much exposed to the hazards of unemployment as those who are included. As stated in Moorman Mfg. Co. v. Iowa Unemployment Comm., 230 Iowa 123, 135,296 N.W. 791, this statute was not intended to be all-inclusive.
We can find no justification under the law or the facts for including within the coverage of this statute the appellant Brumbaugh. He was not an employee or servant of the appellee, nor under its direction or control in the performance of service under his contract or in fact. There can be no question about this. Suppose that in driving his automobile over a mail route, seeking to find subscribers for Successful Farming, he had negligently injured someone. We think no one would say that the appellee would be liable in damages to such an injured person.
The Employment Security Law by neither expression nor reasonable implication covers the appellant Brumbaugh.
[7] Section 1551.12 (J), Code, 1939, provides that any order or decision of the Commission may be modified, reversed, or set aside (1) if it acted without or in excess of its powers; (2) if the facts found do not support its order; (3) if there is not sufficient competent evidence in the record to warrant making the order or decision. *Page 686
We find that each and all of the three grounds stated sustain the setting aside of the order, decision, or decree of the Commission.
Our decision herein is in full accord with that of Moorman Mfg. Co. v. Iowa Unemployment Comp. Comm., 230 Iowa 123, 296 N.W. 791, and there is no holding to the contrary in Kaus v. Unemployment Comp. Comm., 230 Iowa 860, 299 N.W. 415; Iowa Public Serv. Co. v. Rhode, 230 Iowa 751, 298 N.W. 794; Woods Bros. Constr. Co. v. Iowa Unemployment Comp. Comm., 229 Iowa 1171, 296 N.W. 345; Equitable L. Ins. Co. v. Iowa Employment Sec. Comm., 231 Iowa 889,2 N.W.2d 262, 139 A.L.R. 885.
Appellants have cited numerous decisions from other jurisdictions construing statutes containing the three-point tests, with fact situations much different from that disclosed by this record. These authorities support the position of the appellants respecting the broader coverage claimed for this legislation. These authorities are not pursuasive, for the reasons stated herein. Some of these decisions are McDermott v. State of Washington, 196 Wash. 261, 82 P.2d 568; In re Appeals of Farwest Taxi Service, 9 Wash. 2d 134, 114 P.2d 164; State v. Goessman, 13 Wash. 2d 598, 126 P.2d 201; Babb Nolan v. Huiet, 1942, 67 Ga. App. 861, 21 S.E.2d 663; Johnson v. Huiet, 1942,67 Ga. App. 638, 21 S.E.2d 437; Review Board of Unemp. Comp. Div. v. Mammoth Life Acc. Ins. Co., 1942, Ind. App., 42 N.E.2d 379; Industrial Comm. v. Northwestern Mut. L. Ins. Co., 103 Colo. 550,88 P.2d 560; Brannaman v. International Service Union Assn.,108 Colo. 409, 118 P.2d 457, 137 A.L.R. 621; Life Cas. Ins. Co. v. Unemployment Comp. Comm., 178 Va. 46, 54, 16 S.E.2d 357; Unemployment Comp. Comm. v. Harvey, 179 Va. 202, 18 S.E.2d 390; Schomp v. Fuller Brush Co., 124 N.J.L. 487, 12 A.2d 702, affirmed 126 N.J.L. 368, 19 A.2d 780; Superior Life Ins. Co. v. Board of Review, 127 N.J.L. 537, 23 A.2d 806; Unemployment Comp. Comm. v. Jefferson Standard L. Ins. Co., 215 N.C. 479,2 S.E.2d 584; National Tunnel Mines Co. v. Industrial Comm., 99 Utah 39,102 P.2d 508; Combined Metals Co. v. Industrial Comm., 101 Utah 230,116 P.2d 929; Singer Sewing Machine Co. v. State Unemp. Comp. Comm., 167 Or. 142, 103 P.2d 708, 116 P.2d 744, 138 *Page 687
A.L.R. 1398; McKinley v. Payne Son Lbr. Co., 200 Ark. 1114,143 S.W.2d 38; Young v. Bureau of Unemp. Comp., 63 Ga. App. 130,10 S.E.2d 412; Bowman v. Atkinson, 136 Ohio St. 495,26 N.E.2d 798; In re Mid America Co., 31 F. Supp. 601.
The judgment appealed from is affirmed. — Affirmed.
WENNERSTRUM, C.J., and STIGER, SAGER, HALE, OLIVER, GARFIELD, and MILLER, JJ., concur.
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432278/
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I am unable to agree with the majority opinion. The opinion is inconsistent with our former holdings in the cases to which reference is made. This court is committed to the rule that the word "permanent" should be given its ordinary meaning, that is to say, that permanent disabilities are such as will last through life. We have recognized that whether or not an injury is permanent is a fact to be determined by the jury or other trier of the facts upon the testimony produced upon the trial, that *Page 1108
there must be some evidence from which it can be found that the injuries will last through life, but that the fact is to be determined from a preponderance of the evidence. The situation in relation to proof of permanency, under our rule, is substantially the same as exists in cases involving future pain and suffering, future items of expense, and things of that kind. The fact is to be found from the preponderance of evidence and, of course, this means that permanency need not be established to a certainty. Whether disabilities are, in truth, permanent cannot be known for a certainty until the close of life has told the whole story. Still every injury is either temporary or permanent. The rights of the parties require the determination of the character of the disability prior to death. Under the rule which we have adopted, the character is to be determined, as any other fact, from a preponderance of the evidence and such determination fixes the rights of the parties until and unless changes demonstrate that the finding was erroneous, in which event, under provisions of the policy, the benefits are cut off.
I think our rule in this respect is the better rule and it seems to be sustained by the greater weight of authority. The cases sustaining the rule are the following: Hawkins v. John Hancock Mut. L. Ins. Co., 205 Iowa 760, 218 N.W. 313; Kurth v. Continental Life Ins. Co., 211 Iowa 736, 234 N.W. 201; Steffan v. Bankers Life Co., 267 Ill. App. 248; Metropolitan Life Ins. Co. v. Noe, 161 Tenn. 335, 31 S.W.2d 689; Home Ben. Assn. v. Brown (Tex. Civ. App.) 16 S.W.2d 834, 835; Ginell v. Prudential Ins. Co., 237 N.Y. 554, 143 N.E. 740; Brod v. Detroit Life Ins. Co.,253 Mich. 545, 235 N.W. 248; Metropolitan Life Ins. Co. v. Blue,222 Ala. 665, 133 So. 707, 79 A.L.R. 852; Shipp v. Metropolitan Life Ins. Co., 146 Miss. 18, 111 So. 453; Ellis v. New York Life Ins. Co., 214 Ala. 166, 106 So. 689. See, also, Maze v. Equitable Life Ins. Co., 188 Minn. 139, 246 N.W. 737. The cases to the contrary are the following: Penn. Mutual Life Ins. Co. v. Milton,160 Ga. 168, 127 S.E. 140, 40 A.L.R. 1382; Adamson v. Metropolitan Life Ins. Co., 42 Ga. App. 587, 157 S.E. 104; Equitable Life Assurance Soc. v. Serio, 155 Miss. 515,124 So. 485; Wenstrom v. Aetna Life Ins. Co., 55 N.D. 647, 215 N.W. 93, 54 A.L.R. 289; Laupheimer v. Mass. Mut. L. Ins. Co., 224 Mo. App. 1018, 24 S.W.2d 1058. See, also, Maze v. Equitable Life Ins. Co., supra. The case of Maze v. Ins. Co., supra, is cited both ways. The case is argued one way and decided the other. *Page 1109
The other question has to do with the character which disabilities must possess in order to be total. The case of Lyon v. The Railway Passenger Assurance Co., 46 Iowa 631, was decided in 1877. It has been generally regarded as definitely committing this court to the rule that injuries to be total within the meaning of provisions of the kind under consideration must completely disable the insured. In subsequent opinions this court has so regarded that case. I doubt very much whether it was the intention of the court to adopt such a rule by what was said in the Lyon case, but on account of the fact that in subsequent cases the court has, in effect, so considered the case, I believe if any change is to be made in our position, it might better be done by overruling the case and restating our position, than by attempting to modify the effect which this case has had on our law. The Lyon case came before the court on objections to two instructions. The instructions under consideration in that case went fully as far in favor of the insured as any court has gone and I may say that some of the courts have gone a long way. In discussing these instructions, this court went to the other extreme. It was a great many years before the question again came before the court, but in late years it has been here in the cases of Hurley v. Bankers Life Co., 198 Iowa 1129, 199 N.W. 343, 37 A.L.R. 146; Corsaut v. Equitable Life Assur. Soc., 203 Iowa 741, 211 N.W. 222, 51 A.L.R. 1035; Kurth v. Continental Life Ins. Co.,211 Iowa 737, 234 N.W. 201. In the Hurley case, which was decided in 1924, an examination was made of all of the authorities and the court specifically expressed its adherence to the rule announced in the Lyon case. In the Corsaut case, decided in 1927, the rule was followed upon the authority of the Hurley case. The Kurth case was decided in 1931. In the opinion Judge DeGraff quotes from a number of cases which are inconsistent with the rule formerly recognized by this court. I think on the whole the language used in this case is in conflict with much that was said by the court in the earlier cases. The facts upon which the case is based are sufficient to sustain the case without any deviations from the rules announced in the earlier cases. The opinion refers to the earlier cases and approves them. The holding is entirely consistent with the earlier cases, but the reasoning by which the result is reached is the reasoning which is adopted by courts adhering to the other rule. In the Kurth case the record was such that a finding that the injuries were both permanent and total could be made. *Page 1110
In the Hurley and Corsaut cases the testimony showed conclusively that the injuries fell far short of being total and the same is true of the injuries in the original Lyon case.
In this situation it occurs to me we have not had occasion to define the extent and limits to which disabilities must go in order to be total.
I am inclined to believe that the better rule and the rule supported by the weight of authority in other states is that disability, in order to be total, must, in effect, prevent the insured from effectively engaging in any business, profession, or occupation in the light of the circumstances in which the insured finds himself. The foregoing sentence does not represent an attempt to accurately state the rule, but I think it is sufficient for the present purpose. This rule would be inconsistent with the language of all our cases but it would not be inconsistent with the matters actually decided in such cases. It would be a very material extension of liability beyond what a reading of the cases would indicate our rule to be at the present time. In a proper case I would be willing to clarify our holdings in this respect.
I do not believe that the present case is one in which this should be undertaken for the reason that the facts bring the case squarely within four of our cases, namely, the Lyon, the Hurley, the Corsaut, and the Kurth cases. In this situation it becomes essential to disclose the character of plaintiff's disabilities as revealed by the record.
Over proper objection, plaintiff was permitted to answer this question:
"Q. I will ask you, Mr. Garden, whether or not you are now physically incapacitated so as to be wholly and permanently unable to engage in any occupation or profession or perform any work whatever for gain or profit?"
Over proper objection, two physicians, testifying for plaintiff, answered the following question in the affirmative:
"Q. You may state whether or not Archie E. Garden is now physically incapacitated so as to be wholly and permanently unable to engage in any occupation, profession, or to perform any work whatsoever for compensation, gain or profit?"
Such questions clearly invaded the province of the trier of the fact, and in consequence were incompetent. See Justis v. Union *Page 1111
Mut. Cas. Co., 215 Iowa 109, 244 N.W. 696, in which a multitude of the cases of this court are collected, all holding such questions incompetent. The inherent vice of questions of this character is that the answer to the question involves a construction of the contract by the witness, as is clearly demonstrated by the subsequent examination of the witnesses from which we quote. This is what the first physician said:
"Q. Doctor, would you say that everybody that had arthritis is permanently and totally disabled from performing any work or labor? A. When it is as extreme as that he is for the time being permanently and totally disabled.
"Q. What do you mean by permanent? A. This permanent injury to the knee joint, septic injury.
"Q. You use the term permanent as applied to the injury? A. Yes, sir.
"Q. You do not mean to tell the court he is permanently disabled from ever performing any work or labor? A. I do not."
This is what the second physician said:
"Q. Would you say to the court, or did you say to the court, that in your opinion here that your nephew would never be able to engage in any work? A. I did not."
The proofs filed by plaintiff with his claim for disability benefits are in the record. In them appear the following question and answer:
"How soon in your opinion will insured be able to engage in any occupation, partial or otherwise?"
"Able to be partially occupied now."
This is the answer of plaintiff's own physician. There is no evidence in the record, not so much as a single sentence or single word which associates totality with permanency in regard to plaintiff's disabilities. He was, we will say, totally disabled at the time of the trial. He had then been ill ten months. He could not be made well in a day. In that no man, even one skilled in medicine, can tell how soon the recuperative powers of the body will work their changes, the duration of his disabilities was then "indefinite". But unless it be that the duration for a period of ten months of a disease from which most people recover, and in relation to which *Page 1112
the prognosis of plaintiff's physicians is evasive rather than uncertain, warrant a finding that plaintiff's disabilities would be of "indefinite duration" in the sense that they would likely endure through life, there was no evidence from which a finding of totality and permanency could be made.
The case was tried as in equity and is here for trial anew. We are not concluded by any finding of fact in the lower court. The only conclusion which a reading of the record warrants is that plaintiff will have a stiff knee. It is a matter of common knowledge that a stiff knee does not produce total disability, and there is no evidence in the record from which it could be found that plaintiff was so situated that a stiff knee would so incapacitate him.
The majority opinion holds that disabilities far short of total, and much less enduring than "permanent", entitle the insured to disability benefits under policies of the kind under consideration. In truth, it writes a new contract of insurance.
I am authorized to say that Mr. Justice DONEGAN concurs in this dissent.
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/4302235/
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17-2405-cr
United States v. Alston
17-2405-cr
United States v. Alston
United States Court of Appeals
FOR THE SECOND CIRCUIT
______________
August Term, 2017
(Argued: June 6, 2018 Decided: August 9, 2018)
Docket No. 17‐2405‐cr
______________
UNITED STATES OF AMERICA,
Appellee,
–v.–
MERLIN ALSTON,
Defendant‐Appellant.
______________
B e f o r e :
CABRANES, LYNCH, and CARNEY, Circuit Judges.
1 ______________
2
3 Defendant‐appellant Merlin Alston, a former New York City police officer,
4 appeals his convictions, following a jury trial, for (1) conspiracy to distribute and
5 possess with intent to distribute five kilograms or more of cocaine and a quantity of
6 MDMA, in violation of 21 U.S.C. §§ 841(b)(1)(A), (b)(1)(C), and 846, and (2) possessing a
7 firearm in furtherance of that drug trafficking offense, in violation of 18 U.S.C. § 924(c).
8 Alston argues, as to the drug conspiracy count, that the evidence presented at trial was
9 insufficient to sustain his conviction. As to the firearms possession count, Alston asserts
10 that he cannot be convicted under section 924(c) for possessing his service weapon in
11 furtherance of a drug trafficking offense, because he was a police officer entitled or even
1 obligated to carry that weapon at the time of the alleged offense conduct. He contends
2 further that the government’s evidence regarding his possession of a firearm other than
3 his service weapon was insufficient to sustain a conviction under section 924(c). Alston
4 argues additionally that the District Court erred in denying his motion for a new trial,
5 which he based on two grounds: discovery of a cooperating witness’s allegedly false
6 testimony, and newly discovered evidence about that cooperating witness’s post‐trial
7 misconduct in prison. Finally, Alston asserts that the District Court erred procedurally
8 in calculating his Guidelines range by refusing to reduce his offense level to account for
9 his minor role and by imposing enhancements for obstruction of justice and abuse of his
10 position of trust. We reject each of these challenges.
AFFIRMED.
______________
11
12 THOMAS MCKAY, Assistant United States Attorney (Jared
13 Lenow and Karl Metzner, Assistant United States
14 Attorneys, on the brief), for Geoffrey S. Berman, United
15 States Attorney for the Southern District of New York,
16 New York, NY, for the United States of America.
17
18 ROGER BENNET ADLER, Roger Bennet Adler, P.C., New York,
19 NY, for Merlin Alston.
______________
SUSAN L. CARNEY, Circuit Judge:
20 Defendant‐appellant Merlin Alston, a former New York City police officer,
21 appeals his 2016 convictions, following a jury trial, in the United States District Court
22 for the Southern District of New York (McMahon, C.J.). Alston was found guilty of
23 (1) conspiracy to distribute and possess with intent to distribute five kilograms or more
24 of cocaine and a quantity of the controlled substance MDMA, in violation of 21 U.S.C.
25 §§ 841(b)(1)(A), (b)(1)(C), and 846, and (2) possessing a firearm in furtherance of that
2
1 drug trafficking offense, in violation of 18 U.S.C. § 924(c). He also appeals his sentence
2 of 240 months’ imprisonment.
3 Alston asserts several challenges to his convictions and his sentence. He argues
4 that the evidence at trial was insufficient to sustain his conviction on the drug
5 conspiracy count. Alston also asserts that he cannot be convicted under 18 U.S.C.
6 § 924(c) for possessing his service weapon in furtherance of a drug trafficking offense,
7 because he was a police officer at the time of the alleged offense conduct and was
8 entitled and even obligated to carry that weapon. He contends that the government’s
9 evidence regarding his possession of a firearm other than his service weapon was
10 insufficient to sustain a conviction under section 924(c). Alston further maintains that
11 the District Court erred in denying his motion for a new trial based on a cooperating
12 witness’s allegedly false testimony and on newly discovered evidence about that
13 cooperating witness’s post‐trial misconduct in prison. Finally, Alston asserts that the
14 District Court erred procedurally in calculating his Guidelines range by refusing to
15 reduce his offense level to account for his minor role and by imposing enhancements for
16 obstruction of justice and abuse of a position of trust. For the reasons set forth below,
17 we reject each of these challenges.1
1 We also deny Alston’s eleventh‐hour motion to “remand” his appeal. See United States v.
Alston, No. 17‐2504‐cr, Dkt. No. 66 (2d Cir.). Alston raises arguments in his motion similar to
those that he raises in his briefs, and—for the reasons stated below—we find those arguments
unpersuasive. To the extent that he argues that we should remand to allow the District Court to
reconsider his motion in light of new caselaw, we may consider such developments on appeal.
See Fed. R. App. P. 28(j). To the extent that he argues that new information contained in press
accounts further supports his claims, that information is outside the record and cannot be
3
1 BACKGROUND
2 Alston worked as a New York City police officer from 2006 until his arrest in July
3 2015. A few years into his law enforcement career, however, he began serving as an
4 armed driver for his childhood friend, Gabriel Reyes, who sold marijuana, cocaine, and
5 MDMA. Alston knew that Reyes was dealing drugs, but he never reported Reyes to
6 authorities or encouraged Reyes to stop. To the contrary, Alston helped Reyes avoid
7 intervention by law enforcement. Meanwhile, Alston benefited from Reyes’s lavish
8 lifestyle, borrowing money, jewelry, and luxury cars from Reyes and spending evenings
9 with him at expensive nightclubs, all funded by profits from Reyes’s illegal drug
10 transactions.
11 On October 31, 2016, a jury convicted Alston of two crimes arising out of the aid
12 he provided to Reyes: (1) conspiracy to distribute and possess with intent to distribute
13 five kilograms or more of cocaine and a quantity of MDMA, in violation of 21 U.S.C.
14 §§ 841(b)(1)(A), (b)(1)(C), and 846, and (2) possessing a firearm in furtherance of a drug
15 trafficking offense, in violation of 18 U.S.C. § 924(c). He was eventually sentenced to 20
16 years’ imprisonment. He now challenges both his convictions and sentence.
17 “As we must when evaluating an appeal following a conviction by a jury, we
18 recite the facts in the light most favorable to the government, and as the jury was
19 entitled to find them in its deliberations.” United States v. Tang Yuk, 885 F.3d 57, 65 (2d
considered by us on appeal. At this juncture, if Alston has admissible evidence of the claimed
misconduct, it should be presented in a petition pursuant to 28 U.S.C. § 2255.
4
1 Cir. 2018). Much of the relevant testimony at trial was provided by Reyes, who began to
2 cooperate with law enforcement after Reyes’s own arrest in July 2014.
3 I. Alston helps Reyes distribute drugs
4 Merlin Alston and Gabriel Reyes’s friendship began when the two were high
5 school classmates in the Bronx, and they remained close into adulthood. After high
6 school, Alston pursued a career in law enforcement, graduating from the police
7 academy in 2006 and then working as an officer in the New York City Police
8 Department. Reyes, meanwhile, took a distinctly different path: in 2008, he began
9 selling drugs, starting with marijuana, and later moving on to cocaine and MDMA.
10 From 2009 through 2014, Alston and Reyes saw each other frequently, despite
11 their conflicting occupations. Although Alston knew that Reyes sold marijuana, he
12 never challenged the practice or threatened to arrest Reyes. Nor did he object when
13 Reyes moved from selling marijuana to cocaine or even when, in his presence, Reyes
14 packaged cocaine for sale. Alston and Reyes did not use cocaine, but they did
15 occasionally use MDMA.
16 In 2009 or 2010, Alston’s involvement in Reyes’s illegal drug activity changed
17 from passive acquiescence to active assistance. While the two were “hanging out” one
18 day, Reyes had to leave to make a drug delivery. Tr. 97.2 Alston offered to drive Reyes
19 to the encounter, commenting that it would be “safer” if he drove. Id. Later, Alston
20 explained to Reyes that it was in his view safer for him (Alston) to drive because Alston
2 Citations to “Tr.” refer to the trial transcript, relevant portions of which are available at United
States v. Alston, No. 15‐cr‐435, Dkt. Nos. 90, 94, and 96 (S.D.N.Y.).
5
1 faced a lower risk from other law enforcement officers; he said it would be “a lot better”
2 for him rather than Reyes to be pulled over on the road. Tr. 109.
3 From that first drug delivery together until some time in 2014, Alston drove
4 Reyes to or from approximately 30 drug transactions. The vast majority of those
5 transactions involved cocaine, and Reyes estimated that Alston helped him deliver
6 approximately 40 kilograms of cocaine in total over this period.
7 Alston knew how to access the secret compartments in Reyes’s cars where Reyes
8 had hidden guns and drugs. Although Alston “never got his hands dirty with the
9 cocaine,” Tr. 105, he sealed and carried bags of cocaine for Reyes. If he was present
10 when Reyes had to travel to a drug delivery or pickup, Alston usually drove Reyes.
11 While the transaction was being conducted, Alston would stay in the car, and he never
12 drove to drug transactions on his own, without Reyes present. On several occasions,
13 however, Alston asked Reyes about picking up or delivering the drugs on his own, and
14 at one point he also raised with Reyes, unsuccessfully, the possibility of procuring a
15 kilogram of cocaine for Reyes. In addition, to avoid detection, Alston changed his phone
16 number “a lot,” and when near his family, he did not socialize with Reyes or other drug
17 dealers. Tr. 181.
18 Alston benefited from Reyes’s generosity toward friends and associates. For
19 example, Reyes frequently paid for Alston to spend evenings with him and mutual
20 friends at expensive nightclubs, sometimes two or three nights per week, and Reyes
21 subsidized their vacations together in Atlantic City and Miami. Reyes also loaned
22 Alston luxury vehicles and jewelry. Alston also occasionally reported experiencing
6
1 financial difficulties, and when he did so, Reyes loaned him thousands of dollars, debts
2 that Alston did not repay in full.
3 II. Alston’s assistance benefits Reyes
4 Reyes felt safer, he said, when Alston drove him to or from drug deals than when
5 he drove himself. Alston’s position as a police officer greatly reduced the risk that other
6 law enforcement officers posed to Reyes, he thought. For example, Reyes testified that
7 he and Alston were once traveling by car, carrying weapons, and were pulled over by
8 an NYPD officer. Alston “showed [his] badge,” and the two were permitted to leave the
9 stop without incident. Tr. 125. And, although Reyes generally did not sell drugs in the
10 46th Precinct, in the Bronx, where Alston worked, on at least one occasion Alston tipped
11 off Jeff Vargas, Reyes’s friend and fellow drug dealer, who did operate in that precinct,
12 about law enforcement activity there that might put Vargas at risk.
13 Even when Alston was not driving Reyes to his drug transactions, Reyes
14 benefited from their association. Alston gave Reyes a Police Benevolent Association
15 (“PBA”) card, for example, which Reyes displayed to be released from traffic stops
16 (including, on one occasion, when he was transporting cocaine in his car). And, on
17 another occasion, Reyes called Alston during a traffic stop, seeking Alston’s help
18 because he was in possession of cocaine that was not hidden in a secret compartment.
19 Alston, who was on duty, “rushed over” to the stop in a police car and spoke to the
20 officer in charge. Tr. 126. Reyes was able to leave the stop without being searched. He
21 sold the cocaine that he had been transporting.
22 Alston did more than run interference between Reyes and law enforcement,
23 however. When he drove Reyes to or from a drug transaction, Alston was “usually”
7
1 armed with his service weapon, Tr. 118, and Reyes understood that Alston was
2 prepared to protect him from violence if necessary. Reyes’s concern that he might be the
3 target of violence was justified: Reyes and another drug dealer had once been involved
4 in a shootout in which someone was injured. Reyes testified that he believed that his
5 dispute with the other dealer had escalated to physical violence because Alston was not
6 present; during an earlier encounter with the same dealer, when Alston was present, no
7 violence had occurred. As Reyes explained it, “They knew who Merlin was . . . [and]
8 they told everybody: Yo, we can’t do that. We know who this is, and stuff.” Tr. 230.
9 In 2014, in a nightclub, Reyes had a disagreement with another drug dealer, BX
10 Hova. The dispute was not initially drug‐related: BX Hova was displeased that, at the
11 club, Reyes was talking to a particular woman. But because the dispute was “bad for
12 business,” Tr. 233, Vargas, who supplied drugs to both Reyes and BX Hova, arranged
13 for Reyes and the other dealer to meet face‐to‐face to resolve it. Reyes was concerned
14 that the dealer would “jump[]” him at the meeting and so arranged for Alston to
15 accompany him. Tr. 236. Alston borrowed a shotgun from Reyes for the meeting. While
16 Reyes and BX Hova met, Alston stayed nearby in his car, with the shotgun at hand in a
17 duffel bag. In the end, Alston did not exit his car during the encounter, and the meeting
18 ended without violence.
19 III. The District Court proceedings
20 Alston was arrested on July 14, 2015. He was charged with (1) conspiracy to
21 possess and distribute five kilograms or more of cocaine, as well as some amounts of
22 heroin and MDMA, in violation of 21 U.S.C. §§ 841(b)(1)(A), (b)(1)(C), and 846, and (2)
23 possessing a firearm in furtherance of a drug trafficking crime, in violation of 18 U.S.C.
8
1 § 924(c). On October 31, 2016, following a two‐week jury trial, Alston was convicted of
2 both counts. As to the drug count, the jury found that the conspiracy of which he was
3 part extended to possession and distribution of cocaine and MDMA, but not to heroin.3
4 In the opening months of 2017, Alston (now appearing through new counsel)
5 moved unsuccessfully for a judgment of acquittal or, in the alternative, for a new trial.
6 Alston asserted, in part, that the government violated his due process rights by
7 knowingly allowing Reyes to testify falsely about Reyes’s “leas[ing]” of a Bronx car
8 wash operation and that the evidence at trial was legally and factually insufficient to
9 convict him of both the drug conspiracy and firearms counts. Appellant’s App. (App’t
10 A.) 534. Then, on July 25 of that year—one day before sentencing—the government
11 submitted a brief letter informing the District Court that the prosecutors had learned
12 that “in early 2017, well after the defendant’s trial,” Reyes (then imprisoned) had
13 possessed contraband in the form of cigarettes and marijuana, and that the possession
14 was as part of a “store” that Reyes ran for other inmates. Id. at 559. At sentencing the
15 following day, Alston’s attorney requested additional information about Reyes’s
16 misconduct, arguing that the information was significant because Reyes’s credibility
17 was crucial to the government’s case. The District Court denied that request on the
18 ground that Reyes’s credibility was not at issue during the upcoming sentencing.
3 We note that, although the jury convicted Alston of conspiracy to possess and distribute an
undefined quantity of MDMA—a violation of 21 U.S.C. § 841(b)(1)(C)—only conspiracy to
violate 21 U.S.C. § 841(b)(1)(A), which relates to the charged five kilograms or more of cocaine,
appears on the judgment later entered by the District Court.
9
1 During the sentencing itself, the District Court found Alston’s Guidelines range
2 to be 151 to 188 months’ imprisonment on Count One (the drug distribution count),
3 plus a mandatory consecutive term of 60 months’ imprisonment on Count Two (the
4 firearm count). In calculating this range, the District Court applied a two‐level
5 enhancement for obstruction of justice, and a two‐level enhancement for abuse of a
6 position of trust, both over Alston’s objection. The court further rejected Alston’s
7 request for the two‐level reduction applicable to a defendant who played a “minor
8 role.” The District Court sentenced Alston to a total of 240 months’ imprisonment: 180
9 months on Count One and 60 months on Count Two, to run consecutively.
10 After sentencing, Alston again asked the District Court to order discovery
11 regarding Reyes’s jailhouse misconduct. In support, he argued that Reyes’s credibility
12 during trial had been bolstered by the existence of his plea agreement, which included a
13 promise not to commit any additional crimes, and, since that promise had apparently
14 been broken but the breach undisclosed, Reyes’s testimony had received undeserved
15 weight. The District Court again denied the request.
16 Alston now appeals his convictions and his sentence.
17 DISCUSSION
18 Alston argues that his convictions should be vacated for several reasons: the
19 evidence at trial was insufficient to convict him of conspiring to distribute five
20 kilograms or more of cocaine; he has no criminal liability under 18 U.S.C. § 924(c) for
21 possessing his service weapon, because he was a police officer obligated to carry his
22 weapon at the time of the alleged offense; and the evidence regarding his possession of
10
1 another firearm was insufficient to sustain that conviction. He also argues that the
2 District Court erred in denying his motion for a new trial based on Reyes’s allegedly
3 false testimony and on the newly discovered evidence about Reyes’s misconduct in
4 prison. Finally, Alston argues that the District Court erred in calculating his Guidelines
5 range. For the reasons set forth below, we are not persuaded.
6 I. Rule 29 motion
7 Alston first argues that the evidence at trial was insufficient to prove his guilt on
8 either count of conviction.
9 A defendant challenging the sufficiency of the evidence against him under
10 Federal Rule of Criminal Procedure 29 after conviction by a jury “bears a heavy
11 burden.” United States v. Aguiar, 737 F.3d 251, 264 (2d Cir. 2013). “On such a challenge,
12 we view the evidence in the light most favorable to the government, drawing all
13 inferences in the government’s favor and deferring to the jury’s assessments of the
14 witnesses’ credibility.” Id. (internal quotation marks omitted). We review a denial of a
15 Rule 29 motion de novo, but will uphold the jury’s verdict if “any rational trier of fact
16 could have found the essential elements of the crime beyond a reasonable doubt.”
17 United States v. Coplan, 703 F.3d 46, 62 (2d Cir. 2012) (internal quotation marks and
18 emphasis omitted).
19 A. Section 841(b)(1)(A) conviction: cocaine distribution conspiracy
20 Alston challenges the sufficiency of the evidence against him on his conviction
21 for conspiracy to possess and distribute five kilograms or more of cocaine. He contends
22 primarily that (1) the evidence adduced at trial was insufficient to establish that he
11
1 knowingly participated in a conspiracy to distribute cocaine at all, and (2) the evidence
2 was also insufficient to show that he knew the conspiracy involved five or more
3 kilograms of cocaine. The trial record starkly rebuts both contentions.
4 “To prove conspiracy, the government must show that the defendant agreed
5 with another to commit the offense; that he ‘knowingly’ engaged in the conspiracy with
6 the ‘specific intent to commit the offenses that were the objects of the conspiracy’; and
7 that an overt act in furtherance of the conspiracy was committed.” United States v.
8 Monaco, 194 F.3d 381, 386 (2d Cir. 1999) (quoting United States v. Salameh, 152 F.3d 88,
9 145–46 (2d Cir. 1998)). We briefly examine key evidence supporting these elements.
10 Reyes testified at trial that Alston drove him to or from illegal drug transactions
11 approximately 30 times from 2010 through mid‐2014. Most of those transactions
12 involved cocaine, and Alston saw Reyes handle cocaine in quantity on many of these
13 occasions. Alston knew that the purpose of these trips was for Reyes to conduct drug
14 transactions, Reyes said, and he nonetheless offered his assistance: he told Reyes that,
15 because he was a police officer, it would be better for him (that is, Alston) to be pulled
16 over than Reyes. Alston stashed drugs or guns—including his service weapon—in
17 secret compartments that had been installed in Reyes’s cars.
18 On this evidence, the jury could reasonably find that Alston both knowingly
19 participated in the conspiracy and knew, based on the quantity of drugs he personally
20 saw Reyes handle, that Reyes was dealing in more than five kilograms of cocaine. Even
21 if Alston had not himself seen numerous bags of cocaine, the jury could have inferred
22 that Alston knew that the conspiracy involved five or more kilograms of cocaine in light
12
1 of the number of deliveries Alston made with Reyes and the lavish lifestyle that Reyes’s
2 business evidently supported.
3 It is true that this narrative is supported primarily by Reyes’s testimony,
4 corroborated by testimony given by others regarding particular incidents during which
5 Alston discussed drugs with Reyes and others or was present at a drug deal. But
6 Alston’s contentions that Reyes’s testimony was either not corroborated, or was
7 inadequately corroborated, by other evidence presented at trial, or that tension between
8 different witnesses’ accounts of the various drug transactions undercuts their probative
9 value, have little force on appeal, because “[a]ny lack of corroboration goes only to the
10 weight of the evidence, not to its sufficiency.” United States v. Hamilton, 334 F.3d 170, 179
11 (2d Cir. 2003) (internal quotation marks omitted). Moreover, where one witness’s trial
12 testimony conflicts with that of another witness, “we must defer to the jury’s resolution
13 of the weight of the evidence and the credibility of the witnesses.” Id. (internal
14 quotation marks omitted). Alston asserts further in support of his sufficiency argument
15 that certain witnesses did not provide credible testimony. The jury, however, not this
16 Court, is the proper arbiter of that claim. See id.
17 B. Section 924(c) conviction: possession of a firearm in furtherance of drug
18 trafficking
19 Section 924(c) of title 18 requires imposition of a consecutive five‐year term of
20 imprisonment for a person who, “in furtherance of any [drug trafficking] crime,
21 possesses a firearm.” Alston argues that the evidence at trial was not sufficient to
22 convict him of violating section 924(c) for two reasons: first, because his possession of a
23 service weapon cannot, as a matter of law, constitute a federal crime; second, because
13
1 the evidence showed that his possession of the shotgun in connection with the
2 nightclub altercation involved a “romantic dispute,” not a drug trafficking crime.
3 Appellant’s Br. 25. We disagree.4
4 1. Possession of a service weapon during drug transaction transport
5 Alston contends that, as a law enforcement officer, he may not be convicted
6 under section 924(c) when the firearm in question is his service weapon. He argues that
7 he was required by the NYPD Patrol Guide to carry his service weapon with him at all
8 times. Therefore, he insists, he could not violate section 924(c) by possessing his service
9 weapon while he drove Reyes to and from drug transactions.
10 Alston’s argument is meritless. The trial record offers ample evidence from
11 which a jury could infer that Alston carried his service weapon not because he was
12 obligated to do so, but for the purpose of protecting Reyes during the drug transactions.
13 For example, Reyes testified that Alston assured him that he “had [Reyes’s] back” if
14 anything happened. Tr. 121. Reyes understood the statement to mean that Alston would
15 protect him, including by using his gun, in the event that Reyes was robbed or
16 otherwise threatened. In this critical way, Alston supported Reyes in his drug business:
17 he “kept [Reyes] safe.” Id. at 94.
18 A law enforcement officer who possesses or uses a service weapon in furtherance
19 of a drug trafficking offense has no immunity from conviction under section 924(c). See
4 At oral argument, Alston’s counsel argued that Alston should prevail on appeal if either the
evidence regarding the service weapon or the evidence regarding the shotgun was insufficient
to establish a violation of section 924(c). Because we find that the evidence regarding both the
service weapon and the shotgun is sufficient, we do not address that contention here.
14
1 United States v. Vazquez Guadalupe, 407 F.3d 492, 500 n.4 (1st Cir. 2005) (rejecting as
2 “plainly wrong” defendant’s argument that his section 924(c) conviction was
3 unsupported by evidence because his firearm possession was “an inherent part of his
4 employment as a police officer”); United States v. Gonzalez, 528 F.3d 1207, 1214 (9th Cir.
5 2008) (rejecting argument that use of a weapon issued by Border Patrol was
6 “categorically exempted from possible prosecution under § 924(c)”). Even if, as Alston
7 contends, he carried his service weapon at least in part because the NYPD Patrol Guide
8 may have required him to do so,5 we have observed that “a gun may be possessed for
9 multiple purposes.” United States v. Lewter, 402 F.3d 319, 323 (2d Cir. 2005). Possession
10 of a firearm because one believes it necessary to comply with employment conditions
11 “does not preclude possession in furtherance of a drug trafficking offense” in violation
12 of section 924(c). Id.
13 Federal and state laws do provide some limited exemptions for law enforcement
14 officers from legal restrictions on the possession or carrying of firearms. See 18 U.S.C.
15 § 926B(a) (providing that “qualified law enforcement officer[s]” may carry a concealed
16 firearm notwithstanding certain state laws); N.Y. Penal Law § 265.20(a)(1) (providing
17 that certain New York laws restricting possession of firearms do not apply to, inter alia,
5 We offer no view about whether the NYPD Patrol Guide in fact obligates officers generally to
carry their service weapons, but we note that the NYPD Patrol Guide also provides that off‐
duty NYPD officers “are to be unarmed at their own discretion when engaged in any activity of
a nature whereby it would be advisable NOT to carry a firearm.” New York Police Department
Patrol Guide, No. 203‐15(h), (effective Aug. 1, 2013),
https://www1.nyc.gov/assets/nypd/downloads/pdf/public_information/public‐pguide1.pdf (last
visited June 26, 2018). Any obligation imposed by the Patrol Guide in this respect is thus less
than categorical.
15
1 “[p]olice officers”). But Alston was not convicted for merely possessing his service
2 weapon. Rather, the District Court carefully informed the jury that “[m]ere possession
3 of a firearm is not enough for possession to be in furtherance.” Tr. 1082 (emphasis
4 added). In convicting Alston, the jury was instructed that it had to find his possession to
5 have been “incident to and an essential part of some federal drug trafficking crime.” Id.
6 The District Court explained that such a finding was a necessary predicate to a
7 conviction under section 924(c). Id.; see Richardson v. Marsh, 481 U.S. 200, 206 (1987)
8 (recognizing “almost invariable assumption of the law that jurors follow their
9 instructions”). We see no reason to disturb the jury’s finding in this regard.
10 2. Possession of a shotgun at Reyes’s meeting with BX Hova
11 Alston also argues that the evidence at trial was insufficient to establish that his
12 2014 possession of a shotgun—an alternative basis for his firearm possession
13 conviction—violated section 924(c).
14 Alston challenges this conclusion, contending that the trial evidence establishes
15 only that he possessed the gun in connection with a social matter—Reyes’s dispute with
16 BX Hova over a matter of romance—and not “in furtherance of” any drug crime.
17 Alston is correct that, to sustain a conviction under section 924(c), “the
18 government must establish the existence of a specific ‘nexus’ between the charged
19 firearm and the [federal drug trafficking crime].” United States v. Chavez, 549 F.3d 119,
20 130 (2d Cir. 2008) (alteration in original) (quoting United States v. Snow, 462 F.3d 55, 62
21 (2d Cir. 2006)). The “fact‐intensive” nexus inquiry comes down to the question whether
22 the firearm “afforded some advantage (actual or potential, real or contingent) relevant
23 to the vicissitudes of drug trafficking.” Id. (quoting Snow, 462 F.3d at 62).
16
1 Reyes’s testimony sufficed for the jury to find the requisite nexus between
2 Alston’s possession of the shotgun and the cocaine distribution activities with which he
3 was involved. Reyes explained that he had met with BX Hova face‐to‐face because their
4 common supplier, Vargas, had advised them that their conflict was “bad for business.”
5 Tr. 233. The jury could reasonably find that Alston’s presence as Reyes’s armed
6 protector served to embolden Reyes to resolve the dispute, enabling Reyes, BX Hova,
7 and Vargas to pursue their drug businesses without this distraction, and, potentially, to
8 dissuade BX Hova from attacking Reyes, which might have harmed the same
9 businesses. Accordingly, we conclude that, although the genesis of the Reyes‐BX Hova
10 dispute was primarily social, the jury was entitled to find that its resolution was drug‐
11 related.
12 II. Denial of Rule 33 motion
13 Under Federal Rule of Criminal Procedure 33, a district court may “vacate any
14 judgment and grant a new trial if the interest of justice so requires.” In evaluating a
15 Rule 33 motion, the court must “examine the entire case, take into account all facts and
16 circumstances, and make an objective evaluation,” keeping in mind that the “ultimate
17 test” for such a motion is “whether letting a guilty verdict stand would be a manifest
18 injustice.” Aguiar, 737 F.3d at 264 (internal quotation marks omitted). We review a
19 district court’s denial of a Rule 33 motion for abuse of discretion; we assess its findings
20 of fact in connection with such a denial for clear error. United States v. Wong, 78 F.3d 73,
21 78 (2d Cir. 1996).
22 Alston argues that his due process rights were violated when the government
23 failed to correct testimony in which Reyes purported truthfully to disclose his
17
1 employment history and list his previous crimes. These violations, Alston urges, entitle
2 him to a new trial.
3 The government “may not knowingly use false evidence, including false
4 testimony, to obtain a tainted conviction.” Napue v. Illinois, 360 U.S. 264, 269 (1959)
5 (finding due process violation where prosecuting attorney did not correct cooperating
6 government witness’s false testimony that he had not received consideration for his
7 testimony). If the prosecution “knew or should have known of [a witness’s] perjury, a
8 new trial is warranted if there is any reasonable likelihood that the false testimony
9 could have affected the judgment of the jury.” Wong, 78 F.3d at 81 (internal quotation
10 marks omitted).
11 Alston contends that Reyes falsely testified that his last “legal job” was in 2008 or
12 2009; in fact, Alston asserts, in 2013, Reyes also invested in a car wash business, giving
13 him a “legal job” in the business.6 Tr. 301, 365. In addition, Alston claims that Reyes
14 invested in the car wash with money he earned through drug trafficking activities, and
15 this constituted money laundering. He argues that Reyes therefore also testified falsely
16 when he failed to mention money laundering in his testimony about his past criminal
17 activity.7
6 Alston asserts that Reyes “leased” the car wash business from January 2011 until September
2014, but he points to no record evidence supporting that assertion. See Appellant’s Br. 3.
When questioned, Reyes described a number of past criminal offenses, but money laundering
7
was not among them:
Q: Apart from dealing drugs, having guns, and making false statements which
you mentioned earlier, have you committed other crimes—
18
1 Alston has not shown that Reyes’s testimony regarding either his employment or
2 his criminal history was, in fact, false, much less that the government knew of any
3 falsity during its direct examination of Reyes. We see no reason why Reyes or the
4 government would have considered any partial ownership or “leas[ing]” by Reyes of a
5 car wash business to be a “job,” particularly in light of Reyes’s testimony that he did not
6 run the business, but was merely an investor. Appellant’s Br. 31.
7 Even if we assume arguendo that Reyes did violate some statute related to money
8 laundering, Alston identifies no reasonable basis for the inference that, during its direct
9 examination of Reyes, the government was in fact aware of that Reyes was laundering
10 money as Alston alleges. That Reyes had multiple proffer sessions with government
11 officials, without more, hardly supports the conclusion that the government had any
12 relevant knowledge at the time.
13 Finally, we see no reason to think that the government’s failure to elicit details
14 about Reyes’s car wash business on direct examination could have affected the jury’s
15 assessment of the evidence as a whole. On cross‐examination, Alston’s attorney
16 questioned Reyes about his part in the car wash venture and established that Reyes had
17 purchased the car wash in 2013 and owned it for “a quick few months.” Tr. 365. Reyes
A: Yes, I have.
Q: —in your life? Can you just generally tell the jury what sort of crimes.
A: I got locked up when I was young with a gun. I got locked up for suspended
license. I got locked up for hitting an officer.
Q: Any theft or stolen property offenses?
A: Yeah, I got locked up for stolen property. That’s about it.
Tr. 301‐02.
19
1 also confirmed that Alston visited him at the car wash. Thus, to the extent that Alston
2 argues that the car wash testimony was material because it “bolstered Defendant’s
3 reasonable perception that Reyes was ‘legit,’” Appellant’s Br. 33, Alston had the
4 opportunity to make that argument to the jury based on Reyes’s testimony on cross‐
5 examination. We see no abuse of discretion in the District Court’s denial of Alston’s
6 motion for a new trial on this basis.
7 III. Reyes’s jailhouse misconduct
8 In Alston’s view, Reyes’s jailhouse misconduct, and the government’s denial of
9 Alston’s post‐conviction discovery requests about that misconduct, constitute a Brady
10 violation requiring grant of a new trial. Brady violations have three elements: “[t]he
11 evidence at issue must be favorable to the accused, either because it is exculpatory, or
12 because it is impeaching; that evidence must have been suppressed by the State, either
13 willfully or inadvertently; and prejudice must have ensued.” Strickler v. Greene, 527 U.S.
14 263, 281‐82 (1999).
15 Even treating Reyes’s jailhouse misconduct as potentially worthy impeachment
16 evidence, it is not Brady material. The government did not “suppress” the evidence at
17 issue, because Reyes’s misconduct did not occur (and therefore the evidence did not
18 exist) until after Alston’s trial was concluded. Here, so far as the record shows, the
19 government appropriately disclosed what it learned about Reyes’s misconduct
20 promptly after the information came to its attention. The government obviously is not
21 required to disclose before or during trial information that it only learned after trial was
22 over. See United States v. Avellino, 136 F.3d 249, 255 (2d Cir. 1998). Nor, in any event, did
23 Alston suffer prejudice at trial from his ignorance of Reyes’s post‐trial possession of
20
1 contraband, because Alston could not have cross‐examined Reyes about misconduct
2 that Reyes had not yet committed. The District Court, therefore, did not err in denying
3 Alston discovery relating to Reyes’s jailhouse misconduct, and Alston’s Brady
4 allegations do not entitle him to a new trial.
5 IV. Sentencing challenges
6 Finally, Alston contends that his sentence is procedurally unreasonable. He
7 challenges three facets of the District Court’s calculation of his Guidelines range: (a) its
8 denial of a two‐level reduction to account for his allegedly minor role in the drug
9 conspiracy; (b) its imposition of a two‐level enhancement for obstruction of justice; and
10 (c) its imposition of an additional two‐level enhancement for abuse of a position of
11 trust.
12 A district court “commits procedural error where it . . . makes a mistake in its
13 Guidelines calculation.” United States v. Cavera, 550 F.3d 180, 190 (2d Cir. 2008) (en banc)
14 The usual remedy for such a procedural error is vacatur of the sentence and remand for
15 resentencing. Id. We review de novo a district court’s interpretation of the Guidelines
16 and for clear error its factual findings regarding the applicability of specific
17 enhancements or reductions. See United States v. Richardson, 521 F.3d 149, 156 (2d Cir.
18 2008).8
8 We note that, although not for the reasons identified by Alston, the District Court did err,
because it failed fully to calculate Alston’s applicable Guidelines range. At sentencing, the
District Court refused to make a factual finding regarding the drug quantity for which Alston
21
1 A. Minor role reduction
2 Section 3B1.2 of the Sentencing Guidelines provides for a two‐level decrease in
3 the defendant’s offense level “[i]f the defendant was a minor participant in any criminal
4 activity.” U.S. Sentencing Guidelines Manual § 3B1.2(b) (U.S. Sentencing Comm’n 2016).
5 Alston contends that he was entitled to such a reduction in his offense level as a “minor
6 participant.” The Guidelines tell us that a “minor participant” is a defendant “who is
7 less culpable than most other participants in the criminal activity.” Id., application n.5.
was responsible. The quantity calculation would have determined in part Alston’s base offense
level.
In declining to do so, the District Court reasoned that
[t]he use of the drug quantity suggested by the government, 200 kilograms,
based on foreseeability, would result in a guideline sentence that would be
greater than necessary to effectuate the goals of 18 [U.S.C.] Section 3553(a). The
use of the drug quantity actually found by the jury, which is over 5 kilograms,
or between 5 and 15 kilograms, I have concluded is, under the circumstances,
more appropriate, and that is what I will use; and that matter is now decided.
App’t A. 480.
A district court bears the “ultimate responsibility to ensure that the Guidelines range it
considers is correct,” even if it goes on to determine that a sentence located outside the
defendant’s Guidelines range is appropriate. Rosales‐Mireles v. United States, 138 S. Ct. 1897, 1904
(2018); see also United States v. Genao, 869 F.3d 136, 146 (2d Cir. 2017) (noting that “the Guidelines
should be the starting point and the initial benchmark” for criminal sentences (quoting Gall v.
United States, 552 U.S. 38, 49 (2007))). Our Court has thus advised district courts that it is
“important” to calculate each defendant’s Guideline range “strictly and correctly.” Genao, 869
F.3d at 147. The District Court here erred by failing to calculate Alston’s Guidelines range
accurately and completely as its starting point. We nevertheless decline to vacate and remand
Alston’s sentence on the basis of this procedural error, because, to the extent the error affected
Alston’s sentence, it inured to his benefit by lowering his overall Guidelines range, and the
government did not appeal the District Court’s Guidelines calculation.
22
1 Earlier versions of the Guidelines Manual than that applicable to Alston defined
2 a “minor participant” as a defendant “who is less culpable than most other
3 participants.” See, e.g., U.S. Sentencing Guidelines Manual § 3B1.2, application n.5 (U.S.
4 Sentencing Comm’n 2014); U.S. Sentencing Guidelines Manual § 3B1.2, application n.3
5 (U.S. Sentencing Comm’n 2000); U.S. Sentencing Guidelines Manual § 3B1.2, application
6 n.3 (U.S. Sentencing Comm’n 1990). These versions did not explain which
7 “participants[’]” roles should be compared to the defendant’s when determining
8 relative culpability. They left uncertain whether the sentencing court should compare
9 the defendant’s role to that of the other individuals who participated in his specific
10 crime, or (more generally) to that of other participants in the same type of criminal
11 activity.
12 Our Circuit adopted the latter view and interpreted section 3B1.2 to require that
13 district courts gauge a defendant’s culpability “as compared to the average participant
14 in such a crime.” United States v. Rahman, 189 F.3d 88, 159 (2d Cir. 1999). We rejected
15 attempts to focus a district court’s analysis on the specific co‐participants in the
16 defendant’s criminal activity. See, e.g., United States v. Ajmal, 67 F.3d 12, 18 (2d Cir.
17 1995). Other circuits took a different approach and held that the relevant comparators
18 for section 3B1.2 purposes were a defendant’s “co‐participants in the case at hand.”
19 United States v. Benitez, 34 F.3d 1489, 1498 (9th Cir. 1994); see also United States v. DePriest,
20 6 F.3d 1201, 1214 (7th Cir. 1993).
21 In 2015, the Sentencing Commission resolved this division by adopting
22 Guidelines Amendment 794. The amendment clarified the Commission’s intention that
23 a defendant be treated as having a “minor role” in a crime for purposes of section 3B1.2
23
1 when he “is less culpable than most other participants in the criminal activity.” U.S.
2 Sentencing Guidelines Manual § 3B1.2, Amendment 794 (effective November 1, 2015)
3 (emphasis added). The Sentencing Commission explained that it was “generally
4 adopt[ing] the approach of the Seventh and Ninth Circuits,” and instructed courts to
5 determine “the defendant’s relative culpability . . . only by reference to his or her co‐
6 participants in the case at hand.” Id. (emphasis added). “Focusing the court’s attention on
7 the individual defendant and the other participants,” the Sentencing Commission
8 explained, was “more consistent” with the rest of the Guideline than was focusing on
9 participants in the type of criminal activity in which the defendant had engaged. Id.
10 Amendment 794 became effective on November 1, 2015—long before Alston was
11 sentenced.
12 In its submissions to the District Court and to this Court, the government has
13 continued to cite our Circuit’s “minor role” standard dating from before Amendment
14 794 took effect. To the extent the government intends to argue that our interpretation of
15 section 3B1.2 in earlier Guidelines Manuals has survived Amendment 794, we must
16 reject that argument.9 We accord the Sentencing Commission’s interpretation of its own
17 Guidelines “controlling weight unless it is plainly erroneous or inconsistent with the
18 regulation or violates the Constitution or a federal statute.” United States v. Lacey, 699
19 F.3d 710, 716 (2d Cir. 2012) (internal citations omitted). Thus, in the version of
9 We have previously vacated a sentence imposed in the United States District Court for the
Southern District of New York on precisely this basis, albeit in a non‐precedential summary
order. See United States v. Soborski, 708 F. App’x 6, 10–14 (2d Cir. 2017). We expect that, having
clarified the impact of Amendment 794 in this opinion, the government will take note in future
sentencing proceedings of the updated standard for “minor role” reductions.
24
1 section 3B1.2 in effect after the adoption of Amendment 794—including the version in
2 the 2016 Guidelines Manual under which Alston was sentenced—the applicability of a
3 “minor role” reduction depends on the nature of the defendant’s role in comparison to
4 that of his co‐participants in his criminal activity.
5 Applying this updated standard to the case before us, however, we find no
6 procedural error in the District Court’s refusal to grant Alston the two‐level reduction.
7 At sentencing, the District Court reasonably rejected the contention that Alston “was
8 less culpable than his confederates” in light of his “status as a police officer, as an armed
9 enforcer, and as what the government aptly described as a law enforcement spy.” App’t
10 A. 485. Although Alston did not procure or sell drugs himself, as Reyes did, he
11 nonetheless played a critical part in Reyes’s operations. Alston was directly responsible
12 for preventing the two most significant threats to a drug conspiracy—law enforcement,
13 on one hand, and violence from other criminals, on the other—from interfering with
14 Reyes’s trafficking activities. The District Court committed no clear error in finding,
15 therefore, that Alston’s role in the drug conspiracy was thus not “minor,” and that he
16 was not entitled to a two‐level offense reduction under section 3B1.2.
17 B. Obstruction of justice enhancement
18 Section 3C1.1 of the Sentencing Guidelines provides for a two‐level increase “[i]f
19 (1) the defendant willfully obstructed or impeded, or attempted to obstruct or impede,
20 the administration of justice with respect to the investigation, prosecution, or sentencing
21 of the instant offense of conviction, and (2) the obstructive conduct related to (A) the
22 defendant’s offense of conviction and any relevant conduct; or (B) a closely related
23 offense.” U.S. Sentencing Guidelines Manual § 3C1.1 (U.S. Sentencing Comm’n 2016).
25
1 Alston contends that this enhancement should not have been applied and that the
2 District Court mistakenly focused on conduct that preceded his arrest and preceded his
3 learning that Reyes was the subject of an investigation. We disagree.
4 The government introduced into evidence a recorded telephone call in which
5 Alston warned Vargas, Reyes’s supplier, that he (Alston) was on his way to a specific
6 location “[b]y the corner” to “snatch somebody up.” Gov’t Trial Ex. 726‐T. In the call,
7 Alston advised Vargas to warn others “to ghost, to be gone.” Id. And, in a different
8 recorded phone call, another co‐conspirator passed on a message from Alston to
9 Vargas: Vargas’s name was “going around there,” the message went; Vargas “should be
10 on the alert”; and Alston would not speak to Vargas on the phone. Gov’t Trial Ex. 723‐T.
11 At sentencing, the District Court explained that it interpreted these recordings to mean
12 that Alston was instructing Vargas “not to talk on the phone because he was under
13 investigation, and to avoid a certain area of the precinct because Alston was going to
14 have to go there to make an arrest.” App’t A. 486. Based on this evidence, the District
15 Court found it “beyond dispute” that Alston had obstructed justice. Id.
16 We identify no error, much less clear error, in the District Court’s interpretation
17 of Alston’s phone calls with Vargas, and we agree that the calls constitute obstruction of
18 justice. See United States v. Hernandez, 83 F.3d 582, 585 (2d Cir. 1996) (“The sentencing
19 court’s findings of fact regarding the obstruction of justice enhancement are subject to
20 the clearly erroneous standard, while its ruling that the established facts constitute
21 obstruction of justice . . . is reviewed de novo . . . .” (quoting United States v. Rivera, 971
22 F.2d 876, 893 (2d Cir. 1992))). We have previously held that merely alerting the subject
23 of an investigation to the existence of that investigation can constitute “obstruction of
26
1 justice” within the meaning of section 3C1.1. See United States v. Cassiliano, 137 F.3d 742,
2 746‐47 (2d Cir. 1998). It is even easier for us to conclude, therefore, that advising a drug
3 dealer about the imminent risk of arrest—permitting him to evade capture—constitutes
4 such obstruction.
5 C. Enhancement for abuse of a position of trust
6 Finally, Alston challenges the District Court’s application of a two‐level
7 enhancement for abuse of a position of trust. Section 3B1.3 of the Sentencing Guidelines
8 provides for a two‐level increase “[i]f the defendant abused a position of public or
9 private trust, or used a special skill, in a manner that significantly facilitated the
10 commission or concealment of the offense.” U.S. Sentencing Guidelines Manual § 3B1.3
11 (U.S. Sentencing Comm’n 2016). We have applied a two‐pronged test to determine
12 whether this enhancement applies: we ask “(1) whether the defendant occupied a
13 position of trust from the victim’s perspective and (2) whether that abuse of trust
14 ‘significantly facilitated the commission or concealment of the offense.’” United States v.
15 Huggins, 844 F.3d 118, 124 (2d Cir. 2016) (quoting United States v. Thom, 446 F.3d 378, 388
16 (2d Cir. 2006)).
17 Identifying the victims of a drug distribution conspiracy is more difficult than
18 identifying the victims of, for example, a wire fraud scheme. But it hardly follows that
19 we should treat Alston’s crime as victimless for purposes of assessing the applicability
20 of this enhancement. There can be no doubt that drug crime of the kind engaged in by
21 Alston and Reyes, involving illegal cocaine distribution supported by firearms, causes
22 broad social harm. See Harmelin v. Michigan, 501 U.S. 957, 1002‐03 (1991) (Kennedy, J.,
23 concurring) (considering “the pernicious effects of the drug epidemic in this country”);
27
1 United States v. Green, 532 F.3d 538, 549 (6th Cir. 2008) (“Society as a whole is the victim
2 when illegal drugs are being distributed in its communities.”). And, from the
3 perspective of society writ large, a police officer indisputably holds a “position of trust”
4 when it comes to detecting and preventing drug crime. See United States v. Rehal, 940
5 F.2d 1, 5 (1st Cir. 1991). Society is victimized in a particularly malign way when a police
6 officer aids crime instead of stopping it. Thus, the first prong of the analysis is met here.
7 As to the second prong of the analysis, the record establishes that Alston used his
8 position as a police officer both to facilitate and conceal the drug distribution conspiracy
9 in which he participated. While he was on duty, Alston helped to ensure that a fellow
10 NYPD officer conducting a traffic stop of Reyes did not search Reyes’s car. Alston knew
11 that Reyes had cocaine in plain view in the car, and, because he was not searched and
12 the cocaine was not discovered, Reyes went on to sell the cocaine. This incident,
13 standing alone, provides a sufficient basis for the District Court’s decision to impose the
14 “abuse of trust” enhancement. But Alston went even further, giving Reyes a PBA card
15 to help him avoid suspicion during traffic stops when Alston was not able to intervene
16 personally on Reyes’s behalf. It is difficult to imagine a more obvious “abuse of trust”
17 than Alston’s use of his authority: he held that authority as a privilege of his position as
18 a New York City police officer, and he used that authority to help a drug trafficking
19 criminal evade detection and capture.
20 We find no error in the District Court’s imposition of a two‐level enhancement
21 for abuse of trust under section 3B1.3.
28
1 CONCLUSION
2 We have reviewed Alston’s remaining arguments and find in them no basis for
3 vacating his convictions or sentence. For the reasons set forth above, we AFFIRM the
4 judgment of the District Court.
29
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The Plaza Hotel and the Chamberlain Hotel, both in the city of Des Moines, were included in the same condemnation action by the United States Government. In Boss v. Polk County, 236 Iowa 384,19 N.W.2d 225, we had before us the question of whether the Chamberlain Hotel, taken by the United States Government for use during the war emergency of World War II, was exempt from taxation during the period it was used by the Federal Government. We held it was not. Now the owner of the Plaza Hotel seeks an exemption from taxation for the period the Plaza Hotel was used by the Federal Government — during which period it was used to house members of the Women's Army Corps, one of the branches of the military services of the United States. The Des Moines Board of Review and the Polk District Court sustained the assessment. Upon this appeal the Plaza Hotel owner argues the property should be exempt from taxes for 1943 and 1944, the period of the Federal Government's occupancy, because (1) ownership and title vested in the United States at the moment of seizure under eminent domain (2) the realty was immune from taxation while held by the United States and (3) the realty was exempt from taxation as realty used for an armory and military purposes under section 29.50, Code, 1946. *Page 199
[1] I. The answer to the first proposition is that, under the condemnation, title did not vest in the United States at the time of seizure. The condemnation proceedings, as shown by the files in the District Court of the United States for the Southern District of Iowa, Central Division, were under 50 U.S.C. § 1141, section 632, providing that:
"The Secretary of War * * * may cause proceedings to be instituted in any court having jurisdiction of such proceedings, to acquire by condemnation, any real property, temporary usethereof, or other interest therein * * *." (Italics supplied.)
The files show that it was the temporary use of the property that the Federal Government sought to obtain and the decree was in favor of the government for "the full right and interest to the temporary use for a term of years ending June 30, 1945 * * * said term to be cancellable at the election of the United States of America on June 30, 1943 or June 30, 1944 * * * by 60 days notice * * *." The files disclose that the parties were unable to agree on the amount of compensation for the temporary use but the petitioner deposited $23,235 for the use of the building from August 15, 1942, to June 30, 1943, and $26,500 for the period from July 1, 1943, to June 30, 1944. All but $500 of the first deposit and all but $2,000 of the second deposit was turned over to the hotel owner. On February 14, 1944, the Federal District Court awarded the hotel owner an additional final sum of $13,750, plus the $2,500 remaining on deposit in court, and the hotel owner receipted for this final payment as being "in full, complete and final satisfaction and payment of just compensation for the taking of the use of the Plaza Hotel." The United States surrendered possession of the hotel to the owner on February 14, 1944.
The only difference between this case and the Boss case is that in the latter case the parties were able to agree on the amount of compensation to be paid and it became the subject of a stipulation and a judgment confirming same, while here the owner did not agree but did accept the awards of portions of deposits and the final award as compensation for the "taking of the use" of the hotel. *Page 200
The proceedings clearly show the Federal Government acquired the temporary use of the hotel, or a leasehold interest, and the payments were in the nature of rent for such use. The title was at all times in the National Investment Company.
[2] II. Plaintiff's argument that the property is immune from taxation while held by the United States is not clear. It seems to be based on the inherent power of the United States Government to condemn realty and the inability of a state to tax "property of the United States." It is answered by pointing out the special condemnation here did not condemn the realty but only the temporary use of the realty, and the "property of the United States" was not taxed. The argument is foreclosed by our holding in Boss v. Polk County, supra.
[3] III. Plaintiff argues the property was exempt as realty used for an armory and military purposes under, section 29.50, Code, 1946. This section provides:
"All personal and real property held and used for armory or military purposes shall be exempt from taxation * * *."
But this section is a part of the Military Code of Iowa. This entire Military Code deals with the organization, equipment, training, etc., of the state militia and national guard of Iowa. The armory use, referred to in the statute, means the use by the state militia or national guard. The military purpose use, referred to in the statute, is shown to mean the same. The Military Code of Iowa has been amended many times since a state militia was first authorized in 1864 by the Tenth General Assembly of Iowa. A tax-exemption statute first appears in 1909, when the Thirty-third General Assembly enacted a new Military Code of Iowa. This Code contained, in section 41, chapter 131, a law providing it should be "lawful for the boards of supervisors of the several counties and for the city councils of the several cities and towns of the state to exempt from taxation, all personal and real property, held and used for armory or military purposes * * *." The Forty-fifth Extra Session of the General Assembly in 1934 adopted a new Military Code and by section 49, chapter 10, granted the outright exemption provided for in the present Code section. From a study *Page 201
of the entire Military Code, of which section 29.50 is merely a part, and from a study of the history of this legislation, we are convinced the section is applicable only to the state military forces. Because of this conclusion, there is no need to consider whether the argument that the word "held" in the statute means "owned." Other provisions of the Military Code refer to "state-owned armories" and provide for the renting of armories. See section 29.49; and for a case holding the owner of a building rented for use as an armory would not be entitled to an exemption under a similar statute, see Spohn v. Stark, 197 Ind. 299,150 N.E. 787.
The decision of the trial court is affirmed. — Affirmed.
All JUSTICES concur.
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On October 7, 1927, W.H. Quinlan instituted an action in the municipal court of the city of Des Moines against M.J. Harding, on a promissory note for $357.58, and Harding was duly notified, and appeared. Twelve days thereafter, to wit, on October 19, 1927, Harding was adjudged a bankrupt in the Federal Court of the Southern District of Iowa. In such proceedings, Quinlan filed a claim on this note, and was paid a dividend of $41.83, and Harding was discharged in the proceedings on August 10, 1928. Nothing was done on this case in the original proceedings in the municipal court until the latter part of October, 1928, when Judge Sellers of that court assigned this case for disposal on November 2, 1928. Notice of said hearing was published in the Daily Record, an official paper of the city of Des Moines, Iowa, in accordance with the rules of practice of the municipal court of said city, and on the 7th day of November following, a default judgment was entered against Harding in the amount of $598.73. Execution was later issued on said judgment, and property of Harding was levied upon.
On April 20, 1929, plaintiff herein filed his petition in the municipal court, praying that the judgment above referred to, entered on November 7, 1928, be set aside, and that the officer of the municipal court who made the levy of execution be restrained from selling the property, and on final hearing, that he be permanently enjoined from disposing of said property, and claiming that the note in controversy and the debt created thereby were extinguished by the adjudication in bankruptcy and his subsequent discharge. He further claims that the defendant knew of the pendency of the bankruptcy proceedings and his discharge, and that, in taking the default judgment against the plaintiff, defendant perpetrated a fraud upon the court. The municipal court dismissed plaintiff's petition; hence this appeal.
Simplified, in the case of Quinlan v. Harding, between the time the suit was instituted and the time judgment was taken by default, Harding had been discharged in bankruptcy, as against this particular debt, and, 5 months and 13 days after the entry of said judgment, this action was brought, to set it aside on the grounds above stated.
The force and effect of a discharge in bankruptcy is to place in the hands of the bankrupt a complete and perfect defense to an action on the debt barred thereby; but, when recovery *Page 1192
is sought on this debt in another action, the 1. BANKRUPTCY: discharge in bankruptcy avails nothing, unless rights, it is set up and pleaded as a defense. In re
remedies, Estate of Fussell, 129 Iowa 498; Reining v.
and Nevison, 203 Iowa 995; Dimock v. Revere Copper
discharge Co., 117 U.S. 559 (29 L. Ed. 994); 7 Corpus of bankrupt: Juris 414, Section 733; Hallagan v. Dowell, 179 failure to Iowa 172; Fierce v. Fleming, 205 Iowa 1281. plead discharge: effect.
Under this rule, Harding, knowing of his discharge in bankruptcy, should have pleaded the same as a defense in the municipal court case; but since he failed to do so, the discharge in bankruptcy avails him nothing, and the fact that the plaintiff in that case (Quinlan) knew of the existence of the discharge in bankruptcy at the time he took the judgment cannot be made a basis of a charge of fraud in the taking of the judgment. In other words, the fact that the plaintiff knows that the defendant has a legitimate defense to his claim cannot be made the basis of a charge of fraud in the taking of a judgment by default.
In addition to this fact, Section 10681, Code, 1927, governing this court, provides:
"Motions to set aside defaults may be made within ten days after the entry thereof. Motions to vacate a judgment or order, because of irregularity in obtaining it, must be made within ninety days from the entry thereof."
The plaintiff failed to avail himself of either of these provisions of the statute, but waited for over five months before filing his petition in this matter. The statute 2. JUDGMENT: having limited the time in which such attack may by default: be made on a judgment, and the plaintiff having setting failed to come within the limits therein aside: fatal provided, he has no right whatever to make the delay. present attack on this judgment.
Section 10664, Code, 1927, provides:
"All provisions of law relating to the district court and the judges and the jurors thereof shall, so far as applicable and when not inconsistent with this chapter, apply to the municipal court and the judges thereof."
We pass the question of whether or not the remedy now *Page 1193
sought to be exercised in this case is inconsistent with the provisions of the law governing municipal courts. Section 10952 provides:
"Judgment obtained in an action by ordinary proceedings shall not be annulled or modified by any order in an action by equitable proceedings, except for a defense which has arisen or been discovered since the judgment was rendered."
We construed this section in Ulber v. Dunn, 143 Iowa 260. When this rule is applied to the facts before us, there is nothing alleged which would amount to a defense "which 3. JUDGMENT: has arisen or been discovered since the judgment equitable was rendered." Fraud and negligence in not relief: interposing a valid defense is not a ground for defense vacating a judgment. Jones v. Leech, 46 Iowa arising or 186; McConkey v. Lamb, 71 Iowa 636; Jackson v.
discovered Gould, 96 Iowa 488; Church v. Lacy Co., 102 since Iowa 235; McCormick v. McCormick, 109 Iowa 700; judgment Weitzel v. Lieuwen, 179 Iowa 1250; Jenkins Lbr.
entered. Co. v. Cramer Bros., 182 Iowa 161.
It is quite evident, therefore, under the rules above stated, that the plaintiff had no right to maintain this action, and the court was right in its ruling in dismissing his petition. —Affirmed.
MORLING, C.J., and STEVENS, De GRAFF, and WAGNER, JJ., concur.
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Plaintiff is a Delaware corporation doing business through an office in the city of Des Moines, engaged in buying and selling municipal and other securities. It furnished the assessor a schedule under date of December 31, 1929, showing securities in the amount of $195,126.66. The plaintiff concedes that its investment is moneyed capital within the meaning of Section 5219 of the Revised Statutes of the United States, and is capital which comes in competition with national banks. The assessment was made under Section 7005 of the Code of 1927.
Plaintiff's argument is directed solely to the constitutionality of this statute. It claims that the same is void because of the failure to comply with Article VII, Section7, of the Constitution of the state of Iowa, reading as follows:
"Every law which imposes, continues, or revives a tax, shall distinctly state the tax, and the object to which it is to be applied; and it shall not be sufficient to refer to any other law to fix such tax or object."
Section 7005 of the Code of 1927 reads as follows:
"All moneyed capital within the meaning of section 5219 of the revised statutes of the United States shall be listed and assessed against the owner thereof at his place of business, and if a corporation at its principal place of business, at the same rate as state, savings, national bank and loan and trust company stock is taxed, in the same taxing district, and at the actual value of the moneyed capital so invested."
The plaintiff's contention, simply stated, is that Section 7005 imposes a tax, but fails to comply with the provisions of the said Article VII, Section 7, of the Constitution, while the defendant insists that no tax whatever is imposed by said section; that said section is simply a defining of a certain class of property and in no way imposes a tax. The contention between the parties, therefore, narrows itself down to the single proposition of whether Section 7005 fails to comply with the said Article VII, Section 7, of the Constitution. *Page 558
The plaintiff claims that Section 7005 imposes a tax and refers to another law to fix such tax or object. With this contention we are disposed to disagree. Prior to Chapter 63 of the 34th G.A., shares of stock of state, savings, national banks and loan and trust companies were treated and assessed as personal property, under Sections 1310 and 1322 of the Code of 1897 and subsequent amendments thereto. By the last-named act of the 34th G.A., which was an amendment to the aforesaid Section 1310, moneyed capital in the hands of private individuals which came in competition with national banks was specially classified as such in the following terms:
"All moneyed capital within the meaning of section 5219 of the revised statutes of the United States shall be listed and assessed against the owner thereof at his place of business, and if a corporation, at its principal place of business, at the same rate as state, savings, national bank and loan and trust company stock is taxed, in the same taxing district, and at the actual value of the moneyed capital so invested."
It will be observed that this section now appears in the Code of 1927 as Section 7005.
It is quite apparent, therefore, that this section was never intended to impose a tax or to continue one, but, as shown, the same came in by way of amendment, and simply intended to make moneyed capital, as defined, a separate class. In other words, this statute in the light of its history is purely and simply a classification statute; whereas, prior to its enactment, the shares of capital stocks were included in the personal property of the owner, as was permitted in Section 5219 of the United States statutes. The statute, in re-classification of property of the state, sought to classify moneyed capital as involved herein in a separate classification from other personal property. The right of the legislature to make reasonable classifications of property is too well recognized to call for citations and authorities, but in In the Matter of Keeney's Estate, 194 N.Y. 281, which was affirmed in 222 U.S. 525, the New York court said:
"The right and power of governments to single out certain classes of objects for taxation, leaving other classes exempt or taxed at a different rate, or in a different manner, is unquestionable. * * * Such power has been exercised by all governments from the earliest times." *Page 559
In Watson v. State Comptroller, 254 U.S. 122, 65 L. Ed. 170, it is said:
"Any classification is permissible which has a reasonable relation to some permitted end of governmental action. * * * It is enough, for instance, if the classification is reasonably founded in `the purposes and policy of taxation.'"
So much for the general claim made by appellant.
The technical question, however, on which it bases its appeal, briefly stated, is that the statute is unconstitutional because of its reference to Section 5219 of the United States statutes, which it says makes Section 7005 void because of the last provision of Section 7, Article 7, of the Constitution of the state of Iowa, which reads, "and it shall not be sufficient to refer to any other law to fix said tax or object."
It is quite apparent that the only purpose in this reference to Section 5219 of the United States statutes is for a definition of "moneyed capital." It does not make such reference for the purpose of "fixing such tax," and so long as this is not the purpose of the reference, the plaintiff has no complaint. The right to thus cross-reference to statutes of other states or to Federal statutes seems to be quite uniformly recognized. See Brown v. State, 19 S.W. (Mo.) (2d Ser.) 12; Ex parte Burke, 212 Pac. (Cal.) 193; Santee Mills v. Query, 115 S.E. (S.C.) 202; People v. Frankovich, 221 Pac. (Cal.) 671; Texas Co. v. Dickinson, 75 Atl. (N.J.) 803; Scottish Union National Ins. Co. v. Phoenix Title Co., 235 Pac. (Arizona) 137; 59 C.J. 618.
It is apparent, therefore, that there is nothing in this contention of the appellant's.
In addition to this, it may be said that Section 7005, against which the complaint herein is lodged, was a part of Chapter 63 of the Acts of the 34th G.A., which act consisted of five substantial sections amendatory to Section 1310, Code 1897. A reading of the said section, as thus amended, shows that the reference to section 5219 of the Revised Statutes was wholly for the purpose of acquiring a definition of the term "moneyed capital," and in no other respect does the aforesaid chapter conflict with the requirements of Section 7, Article 7, of the Constitution of the state of Iowa.
We conclude, therefore, that the plaintiff has asserted no *Page 560
foundation on which the decision of the district court should be reversed. — Affirmed.
All the Justices concur.
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The appellant, Ethel Bloomfield, was born in the year 1892. She was the daughter of Frank Bloomfield and his then wife. Bloomfield and his wife were divorced in the year 1896, and on the 26th of June, 1906, he was married to appellee herein. There was no child resulting from the second marriage, and appellant was the only child of the first marriage. Shortly after the divorce, appellant, being then about five years of age, removed to Boone in the state of Iowa, where she has ever since resided. Her name was originally Ethel Bloomfield, and she was subsequently married to one Leonard Myrick. Frank Bloomfield died intestate on June 25, 1918, and at that time the record title to the property in question stood in him. On October 16, 1918, appellee herein instituted a proceeding in the district court of Monroe County, to quiet the title to the said property, which was known as Lot 4 in Block 3 in Alford's First Addition to the city of Albia, making Ethel Myrick one of the defendants therein, and also covering unknown claimants. She filed an affidavit of inability to serve the defendant within the state of Iowa, published a notice, as required by statute; and decree was entered in her favor at the November, 1918, term of the district court, quieting the title in her. Appellee occupied the property in question from the date of the death of her husband until the time this action was instituted.
Appellant's petition is in two divisions. In the first division, the aforesaid decree, quieting title in appellee, is attacked as fraudulent. In the second division, she alleges that she is the owner of an undivided two-thirds interest in said property, and the appellee the owner of the remaining one-third interest. She asks to recover rent for her alleged two-thirds interest.
Appellee filed answer, admitting that Frank Bloomfield, *Page 403
her husband, died on the date specified, but denied the interest of Ethel Myrick in said property. She alleges that she is the absolute and unqualified owner in fee of said property, by reason of certain facts alleged to constitute a resulting trust. In the second division of her answer, she relies on the validity of the decree in the aforesaid equity action brought by her to quiet title; denies that she ever knew of the existence of Ethel Myrick as the daughter of Frank Bloomfield; denies knowledge or information of the residence of appellant; asserts that she made diligent search to serve appellant, and was unable to ascertain her place of residence; asserts the truth of the affidavit on which the published notice in that proceeding was based; and asserts that the appellant is barred to assert any right or interest to said property by the decree entered in that proceeding.
After trial, the court found that the action to quiet title instituted by appellee against the appellant was null and void, and set the same aside in its decree. From this part of the decree the appellee herein appealed to this court; but, for some reason not shown in the record, her appeal was dismissed.
The court, for further decree, found that appellant was not, at this time, entitled to partition, because appellee, as the surviving widow, was entitled, if she elected, to hold and occupy said homestead during her natural lifetime, as by law in such cases made and provided. On this phase of the matter, in its decree, the court held that appellant was seized of an undivided two-thirds interest in and to the aforesaid real estate, subject to the right of appellee, as the surviving spouse, to elect to occupy said premises for and during her natural lifetime as a homestead; that, on the death of Frank Bloomfield, appellee became seized of an undivided one-third interest in the premises, as her distributive share, except in case she elected to occupy the whole of said premises as a homestead, in which latter event appellant became seized of said premises in fee simple, subject to the said homestead right. The decree states that appellee "is hereby given the right, for thirty days after final adjudication in this cause, whether in this court or on appeal to the Supreme Court, to elect whether she will take her distributive share therein, then and in that homestead right therein, and in case she elects to take her distributive share therein, then and in that event, the plaintiff will be entitled to a supplemental decree for partition *Page 404
of said premises, unless the parties mutually agree otherwise in relation thereto." The decree in the action to quiet title, brought by the appellee, was vacated, set aside, and held for naught. From the part of the decree in this case giving appellee the right to elect between the distributive share and the homestead right, and incidentally the failure of the court to make her account for the occupancy thereof, Ethel Myrick appeals.
The controlling question in the case is a very narrow one. The appellee in her answer, as heretofore abstracted, closes with the following prayer:
"Wherefore, the defendant demands judgment dismissing the plaintiff's petition, and for costs."
It is insisted by appellant that, because appellee did not plead her right to elect to take the homestead right in her answer, and nowhere in her pleading claimed such right, nor prayed for it therein, the court was without 1. HOMESTEAD: power to grant her such relief. To simplify the life matter, Ethel Myrick's claim is that she was the occupancy: owner of an undivided two-thirds interest in unprayed-for said property, and the appellee of an undivided relief. one-third interest in said property. The appellee, by answer, claims that she was the absolute owner of said property: first, by reason of the decree in the action to quiet title, and secondly, by reason of a resulting trust. The district court held that the appellee was not the owner in fee of said property, and that, under the statute, she had a right of election, if she chose to so do, in taking the homestead in the property for life. We hold that the decree of the district court was right.
It is true that the primary right of the surviving widow in the real property of her husband is that of a distributive share(Egbert v. Egbert, 85 Iowa 525; Smith v. Smith, 132 Iowa 700); but the statutes of the state, Sections 10145, 10146, and 12006 to 12015, inclusive, Code of 1924, provide for her waiver of such right by her election to occupy the property as a homestead during her natural life. As throwing light on this subject, seeThomas v. Thomas, 73 Iowa 657.
We are unable to discover why, under this situation, the appellee, when she fails to prove her asserted fee ownership, should be deprived of any other right she has in said property. The statute gives her the right, if she chooses to exercise it, of *Page 405
taking the homestead, instead of the distributive share, and the court reserved to her this right in its decree. The fact that she did not specifically claim said right, or pray for it in her pleading, would be no cause for depriving her of it. No notice having been served upon her, as required by statute, calling for her election, the right still remained in her to make such election, if she chose so to do, after the respective rights of the parties in the property were fully determined by the court. She, asserting full ownership, was not in a position to determine whether she would take her distributive share or her homestead right until the respective rights of the parties in the property were finally settled. We see no error in the ruling of the court in this respect.
One other question is discussed in the case: to wit, whether or not, under the decree, appellee still has the right of election. There were certain findings made by the court preceding the decree entered by it. In the findings, reference 2. APPEAL AND was made to this right of election, and a 30-day ERROR: limitation was provided, within which appellee decision: must exercise the same; but, in the decree effect. itself, as distinguished from the finding, Nona E. Bloomfield is "given 30 days from and after final adjudication in this cause, whether in this court or on appeal to the Supreme Court, to elect whether she will take her distributive share therein." Under this wording, the case being affirmed by this court, she has 30 days, after final disposition of the cause in this court, within which to exercise her election, if she so chooses; and, in event she does not elect within that time to take her homestead rights in said property, appellant will be entitled to a supplemental decree for partition of said premises, as provided in the decree of the district court. — Affirmed.
De GRAFF, C.J., and EVANS and MORLING, JJ., concur. *Page 406
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I. The Farmers Merchants Savings Bank of Mt. Pleasant, Iowa, closed its doors and passed into the hands of the superintendent of banking, as receiver, on June 6, 1924. The claimants, 68 in number, each deposited in the said bank certain 1. BAILMENT: Liberty bonds, which deposit, as they assert, elements: was for safe-keeping only. The aggregate amount deposit for of bonds thus deposited was $86,550. Of this safekeeping. amount $27,000 was the property of Albert Cornick, and $10,000 that of Jason Cornick. The claims of the Cornicks are not involved in this appeal, but are involved in a separate case previously submitted to this court. Of the bonds, $55,450 in the aggregate passed into the hands of the receiver, and $31,100 are held by the Chase National Bank of New York City, as collateral to a loan by that bank to the insolvent. Of the bonds *Page 861
held by the New York City bank, $17,000 are identified as the bonds of Albert and Jason Cornick, leaving $14,100 in unidentified bonds, which are, however, admittedly a part of the bonds deposited by claimants in this case. The claims of W.S. Green and Herman Mabeus are for a preference, and arise out of transactions of a wholly different character. Each depositor of the Liberty bonds was given a paper, partly in print and partly in writing, in the following form:
"Certificate of Deposit of U.S. Bonds;
"Farmers Merchants Savings Bank — 72-238 No. 545.
"Mt. Pleasant, Iowa, October 23, 1922.
"This certifies that James Alexander has deposited in this bank in United States Fourth Liberty Loan Coupon Bonds, returnable to the order of self at this bank, on the return of this certificate properly endorsed.
"Pay $50 and 00 cents __________ Dollars.
"Interest payable thereon at four and one-quarter per cent on April 15th and October 15th. In lieu of interest on and according to the terms of such bonds.
"Ross Walker, Cashier."
So far as the record shows, claimants received interest on their respective bonds, prior to the insolvency of the bank and the appointment of the receiver for the assets thereof. Claimants all testified that they had no intention of parting with the title to their bonds or of negotiating the same to the bank; that their only purpose was to leave them in its custody for safe-keeping. Notwithstanding the somewhat ambiguous character of the alleged certificate or receipt, the bank never treated the bonds as its property, nor were they placed in the bank's assets. A record was made of all the bonds received, but not in the book in which certificates of deposit issued in the ordinary form were entered. The document handed to the depositor designates the deposit as Liberty bonds, and contains the promise to return them upon demand. The interest was to be paid by the bank, in lieu of interest on the bonds. This undertaking by the bank amounted to nothing more than the payment to the owner of the bond of the interest received from the government, as the coupons attached to the bonds became due.
Counsel for the receiver do not seriously contend in argument *Page 862
that the transaction was anything more than a bailment. The purpose, as disclosed by the testimony of the claimants, was to place the bonds in the bank for safe-keeping only, and this, we think, is clearly shown, by the manner in which they were handled by the bank, to have been the understanding of its officers. The bank was given no authority to use, hypothecate, or sell the bonds. The very terms upon which they were received, negatives any possible agreement or understanding between the parties that they were to be thus used, or converted into cash. The relationship, therefore, between the bank and each of the several claimants was that of bailment, and not of creditor and debtor. It is well settled that, when a bank receives bonds or other property of a customer for safe-keeping, it becomes a bailee, and liable as such. Bowen v. First Nat. Bank, 200 Iowa 40; Kubli v.First Nat. Bank, 199 Iowa 194; Bloomheart v. Foster, 114 Kan. 786
(221 P. 279); Spry v. Hirning, 46 S.D. 237 (191 N.W. 833);State v. Bunton, (Mo.) 285 S.W. 97; National Bank v. Graham,100 U.S. 699 (25 L. Ed. 750); Manhattan Bank v. Walker, 130 U.S. 267
(32 L. Ed. 959).
Authorities need not be cited to the point that it is the duty of the bailee to return to the bailor, upon demand, the specific property which is the subject of the bailment, in accordance with the strict terms of the bailment. The bonds of claimants, therefore, passed into the possession of the receiver subject in all respects to the terms of the bailment under which they were delivered to the bank. Each claimant whose bond or bonds have been specifically identified, is entitled to have the same returned to him by the receiver. The difficulty encountered in the effort of the claimants to identify their specific property was that neither the claimants nor the bank 2. BAILMENT: kept a record of the serial numbers of the unidentified bonds, and, as many of them are for the same bailments: amount, there is apparently no other method by ratable which the specific bonds may be identified. It distribu- is conceded, however, on behalf of the receiver, tion. or clearly shown by the evidence, that all of the bonds in the possession of that officer are a part of the aggregate of bonds deposited by the claimants herein, unless they have been identified as the property of the Cornicks and one other claimant, the Jordan estate, as we understand the record. Accuracy on the part of the court on this point is not *Page 863
essential, as our conclusion makes necessary a remand of the case for further orders in the district court. It follows that either the bonds in the possession of the receiver must be retained by him, because not specifically identified, and be used for the purpose of paying general creditors, or they must be prorated among the respective claimants. It would be manifestly inequitable and unjust to deprive the claimants thereof, and thereby swell the assets of the bank, which never acquired title thereto, to the advantage of creditors. We have no hesitation in holding that the bonds must be returned to the claimants, to be prorated among them, or sold by the receiver, and the proceeds thus used. This may be left to the election of the claimants, acting together and in harmony. This method of distribution was sanctioned by the Supreme Court of the United States inRichardson v. Shaw, 209 U.S. 365 (52 L. Ed. 835).
II. This leaves for disposition only the asserted rights of these claimants to have their claims for the bonds not in the possession of the receiver, but held by the Chase National Bank as collateral to the indebtedness of insolvent thereto, established as preferred claims. The general 3. BANKS AND doctrine by which a preference is allowed in BANKING: favor of a claimant of funds held by an insolvency: insolvent bank in trust is familiar, and needs preference: no further elaboration. Whether this tracing doctrine is applicable to the facts of this conversion. case, and if so, to what extent, we need not determine. For present purposes, we shall assume that it is. The record is not at all clear as to when the bonds held by the New York bank were first misappropriated by the bank to its own use, nor is it claimed that the bank, as bailee of the funds, is not liable for the conversion thereof. On this point, however, seeBailey v. Clarinda Tr. Sav. Bank, 200 Iowa 1147; Kubli v. FirstNat. Bank, supra; American Nat. Bank v. Adams Co., 44 Okla. 129
(143 P. 508); Manhattan Bank v. Walker, supra; National Bank v.Graham, supra; Leach v. Iowa St. Bank of Atlantic, 202 Iowa 887.
It appears that the insolvent bank was indebted to the Continental Commercial National Bank of Chicago in December, 1923, and that the latter was demanding payment. Some of the bonds belonging to appellants were formerly held by the Chicago bank as collateral to the bank's indebtedness. The date *Page 864
when the indebtedness to the Chicago bank was incurred, is not disclosed by the record. The bonds now held by the Chase National Bank were turned over to it to secure an indebtedness of $40,000 incurred in January, 1924. The bonds on deposit in the Continental Commercial National Bank were withdrawn therefrom on January 5th, but it is not clear whether they were returned to the bank at Mt. Pleasant or not. It is possible to infer from the record that they were forwarded to the New York bank, which still has them in its possession. The record discloses nothing whatever as to when the indebtedness to the Chicago bank arose, or what disposition was made of the proceeds of the loan. There is nothing to show that any part thereof went into the bank. Nor does it appear what use was made of the money borrowed of the New York bank. The fair inference from the record is that it was used in the payment of the indebtedness owed by the bank to the Continental Commercial National Bank. There is nothing, therefore, in the record tending in any way to show that anything received from either bank on the credit of the bonds was ever in the possession of the insolvent, or that the assets of the bank were augmented thereby in the hands of the receiver. Upon no theory, therefore, are claimants entitled to a preference of their claims for the bonds not in the actual possession of the receiver. What is said here is applicable to the claim of the Jordan estate. We conclude, therefore, as to these claims, that the bonds in the possession of the receiver, unless otherwise specifically identified, should be turned over to claimants, to be shared pro rata by them. The respective claims against the receiver are based upon the conversion of the bonds by the officials of the bank, and must be so treated. What is here said is subject to the future release of the bonds, or any of them, held by the bank as in excess of the indebtedness to the New York bank. If any of the bonds are returned, as here indicated, they should be returned to the person or persons entitled thereto.
III. The claims of W.S. Green and Herman Mabeus were allowed as preferred claims. Green's claim is for a share of the proceeds of a sale of certain personal property of J.T. *Page 865
Green's, his son, and of a manure spreader owned 4. BANKS AND by claimant, and for rent of a farm. The money BANKING: was deposited in the insolvent bank in pursuance insolvency: of a written agreement signed by the creditors preference: of J.T. Green, who was the claimant's tenant, trust funds. and who had absconded, and Leta Green, his wife. A portion of the proceeds of the sale of the personal property had not been distributed to the creditors entitled thereto when the bank became insolvent. We are not called upon to determine the relative share of each creditor of the bank to whom the money belonged. It is clear that no ground upon which a claim for preference can be based is shown. The relation between claimant and the bank was simply that of creditor and debtor.
Mabeus was the administrator of the estate of his brother Walter Louis Mabeus. The administrator testified that, sometime after his brother's death and his own appointment as administrator of his estate, he called at the 5. BANKS AND bank and asked the cashier if his deceased BANKING: brother had any funds on deposit in the bank. He insolvency: was answered in the negative. After the preference: appointment of the receiver, he learned that his denial of brother did, in fact, have a savings account in deposit. the bank, showing a balance of $1,116.83. The asserted right to have the claim preferred is based upon the above conversation with the cashier of the bank. The relation between the bank and the deceased brother was that of creditor and debtor, and the mere denial of the cashier that the bank was indebted to him did not operate to transform the relation of the bank and the administrator into that of trustee and cestui quetrust.
Other questions discussed by counsel do not require particular consideration. In so far as the judgment below ordered and directed the receiver to deliver the bonds in his possession to claimants, it is sustained; but, in so far as a preference was allowed them as to the remaining bonds, the same is set aside and reversed. They were entitled to have their claims established as general creditors only. Green and Mabeus have the status of depositors, and their claim should be so treated by the receiver.
The case will be remanded to the district court for final order and judgment in harmony with this opinion, and, if necessary *Page 866
to carry out these directions, the court may take further testimony. — Modified and affirmed.
EVANS, FAVILLE, VERMILION, ALBERT, and MORLING, JJ., concur.
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A rehearing was granted in this case, the former opinion being found in 235 N.W. 37, which opinion is hereby withdrawn.
[1] The Farmers National Bank was the owner and holder of a note executed by the defendant, Kate Hughes, dated Nov. 7, 1925. The bank went into liquidation, and this note, with others, was turned over to the plaintiffs as trustees, and as such trustees, on May 10, 1929, they filed their petition in this cause, suing on said note; and in pursuance of the prayer of said petition, attachment was issued and levy made on Lots 1, 2, and 3, in Block 1, Cook's Second Addition to Clio, Iowa.
On April 29th, prior to the bringing of this suit, Kate Hughes was adjudged a bankrupt in United States Federal Court. On June 28, 1929, plaintiffs amended their petition and moved to transfer the cause to equity, and in this amendment they set out that Kate Hughes was adjudged a bankrupt as aforesaid; that a trustee had been appointed, and said trustee filed a report setting off to Kate Hughes, the defendant, as her homestead, the above described lots, which report was approved by the bankruptcy court; that Kate Hughes acquired title thereto through the will of her mother in 1922; that she at no time lived on these lots until 1929, and acquired no residence or homestead rights therein. The prayer was that the plaintiffs have a decree for the amount due by reason of the debts created *Page 243
prior to the acquisition of the homestead, to be established as a lien against said lots, and that the same be sold on execution.
Later, plaintiffs again amended the petition, setting out that the note sued on was a renewal of many previous notes, the principal part of which was for money borrowed from the bank in the year 1922, and again asking that the amount found to be due be established as a lien against said lots.
[2] Much time was devoted to evidence, pro and con, on the question of whether or not this property was the homestead of Kate Hughes at the time it was set over by the trustees in bankruptcy. This question, as we understand it, was not before the court for determination. When the trustees filed their report in the bankruptcy proceedings, setting off this property to Kate Hughes as a homestead, these parties had a right to appear thereto and object to such report, and having failed so to do, it is a final adjudication, by which they are bound for all time. See official form as prescribed by the United States Supreme Court, Collier on Bankruptcy (13th Ed.), Vol. 1, p. 334; also Vol. 3, p. 2410, Form 231.
General Order 17 (11 U.S.C.A., Sec. 53) defines the duty of the trustee, and among other things provides:
"The trustee shall make report to the court, within twenty days after receiving notice of his appointment, of the articles set off to the bankrupt by him, according to the provisions of the forty-seventh section of the act, * * * and any creditor may take
exceptions to the determination of the trustee within twenty days after the filing of the report."
See also McGahan v. Anderson, 113 Fed. 115.
That a setting off of this property as exempt by the Federal Bankruptcy Act is a final adjudication against all the world, see Lockwood v. Exchange Nat. Bank, 47 L. Ed. (U.S.) 1061; McGahan v. Anderson, 113 Fed. 115; In re Bordelon, 4 Fed. (2d Series) 285; In re Brown, 228 Fed. 533; Duffy v. Tegeler, 19 Fed. (2d Series) 305.
It must be held, therefore, as against said trustee in bankruptcy and the creditors whom he represented on the date of the approval of the trustee's report setting off this property to Kate Hughes as a homestead, and therefore exempt, it was finally settled as against all parties, including the plaintiffs herein, that *Page 244
on that date, to wit, April, 1929, the property was the homestead of Kate Hughes.
When exempt property is thus set off by the Federal Court, the rights or claims of creditors therein must be adjudicated and determined in the state courts under the state law, limited or superseded by the bankruptcy act and its effects. Eckhardt v. Hess, 200 Iowa 1308; Schwanz v. Farmers Co-operative Co.,204 Iowa 1273. That the Federal Court recognizes equitable liens under certain circumstances see Johnson v. Root Mfg. Co., 60 L. Ed. (U.S.) 934; Mott v. Wissler Min. Co., 135 Fed. 697; Moore v. Green, 145 Fed. 472.
The evidence in the case abundantly shows that the indebtedness represented by the renewal note was created long prior to that date. The evidence equally shows that Kate Hughes never acquired a homestead right in said property prior to the time it was set off to her in bankruptcy court. She did not acquire a homestead right in said property from her parents, because the same passed to her by will in a different share from what she would have taken under the law of descent. Rice v. Burkhart, 130 Iowa 520; Voris v. West, 180 Iowa 138; Arispe Bank v. Werner, 201 Iowa 484.
It follows, therefore, that Kate Hughes had no homestead right in said property prior to April, 1929, when the same was set off to her in the Federal Court as exempt property, being a homestead. From thence on, under the adjudication of the Federal Court, she had a homestead right in this property.
Plaintiffs say, however, that, even if this be true, she had no homestead right as against them, because the debt owing to them by her long antedated her acquisition of this homestead, and they call to their aid in this respect Section 10155, Code, 1927, which reads in part as follows:
"The homestead may be sold to satisfy debts of each of the following classes: 1. Those contracted prior to its acquisition, but then only to satisfy a deficiency remaining after exhausting the other property of the debtor, liable to execution."
They say, therefore, that they would be entitled to issue an execution, levy on the property and sell it, even though it be the homestead of Kate Hughes, because their debt anteceded the acquisition of this homestead. *Page 245
The summary of the contention of the appellants, stated in another way, is that they are seeking to have a judgment against Kate Hughes on this note, and after they have obtained said judgment, they will then be in a position to avail themselves of this section of the statute, by issuing execution and selling the property.
At this point in the case the troublesome questions arise. To take the plaintiffs at their word, after alleging the facts, they ask that they have judgment for the amount of their claim, and that the court establish the same as a lien on this property. To obtain such judgment and lien on the property, however, the foundation for the same is the promissory note on which they sue. Just what is the status of the plaintiffs on this promissory note in the light of the adjudication in bankruptcy?
It is fundamental that an adjudication in bankruptcy bars all proceedings in the state courts on unsecured claims, except as allowed in bankruptcy law. It is equally well settled that the adjudication in bankruptcy does not bar, or in any way interfere with, the proceedings in state courts to enforce liens (more than four months old) held by creditors against the property of the bankrupt. Lockwood v. Exchange Nat. Bank, 47 L. Ed. (U.S.) 1061; In re Boyd, 120 Fed. 999; In re Rabb, 21 Fed. (2d Ser.) 254; In re Cheatham, 210 Fed. 370; In re Vadner, 259 Fed. 614; In re McBryde, 99 Fed. 686; Duffy v. Tegeler, 19 Fed. (2d Series) 305; In re Maaget, 173 Fed. 232; Ingram v. Wilson, 125 Fed. 913; Phillips v. Krakower, 46 Fed. (2d Ser.) 764; Brown v. Four-in-One Coal Co., 286 Fed. 512; In re Tiffany, 147 Fed. 314.
Of course, if the plaintiffs had sued the defendant on this note and obtained a proper judgment more than four months before the adjudication in bankruptcy, their judgment, under the statute, would be a lien; but they did not do so, and now bring this action after such adjudication in bankruptcy. The pleading of plaintiffs presupposes that they have no lien. They in fact had no lien on the property at the time of the bankruptcy proceedings, and they are now asking the court in this proceeding not to enforce a lien which existed at the time of the bankruptcy, but to establish or create a lien.
Passing the question as to whether or not, under certain circumstances, this could be done in a state court, we are *Page 246
satisfied that it cannot be done in this case. The plaintiffs insist that it can, because they say they have a right to subject this property to the payment of their debt because the debt antedates the homestead. As a practical question, as against their claim there is, in fact, no outstanding homestead right. This is true because the general statute freeing homesteads from judicial process excepts from its operation the very situation we have before us in this case. The plaintiffs therefore have an unsecured claim against the defendant, and the defendant is not in a position to avail herself of this exemption statute as against the proper assertion of said claim. The right, therefore, of the plaintiffs to sue on this claim (without considering the bankruptcy law), take judgment thereon, and issue execution for the sale of said property, is a right which every person has on an unsecured claim against property of any debtor. This right to so subject the property is not a lien, nor is it in the nature of a lien. True, it may be ripened into a lien by suit on the note and judgment in which there is a finding setting out the date and the origin of the debt. If such judgment were entered and the date of the debt antedated the acquisition of the homestead, then, under Section 11602, Code, 1927, such judgment would become a lien on the property. But to accomplish this end, the basis of plaintiffs' action is the promissory note in controversy. Could the plaintiffs therefore sue on said promissory note and put it into judgment after the adjudication in bankruptcy? Plaintiffs stand in the position of holding this unsecured note of the defendant's, and the adjudication in bankruptcy bars any procedure therein in the state courts except, under the circumstances heretofore explained, they may put the same to judgment, but they can have no execution thereon.
In 11 U.S.C.A., Section 103 of the Bankruptcy Act, provision is made that the debts of the bankrupt, founded upon provable debts reduced to judgments after the filing of the petition and before the consideration of the bankrupt's application for a discharge, less costs incurred and interest accrued after the filing of the petition and up to the time of the entry of such judgments, may be proved and allowed against his estate. Also, unliquidated claims against the bankrupt may be, pursuant to application of the court, liquidated in such manner as it shall direct, and may, therefore, be proved and allowed against the *Page 247
estate. These provisions have been interpreted and frequently applied. In re McBryde, 99 Fed. 686; In re James Dunlap Carpet Co., 163 Fed. 541; Moch v. Bank, 107 Fed. 897; Uden v. Construction Co., 1 Fed. (2d Ed.) 743; Berry Clothing Co. v. Shopnick, 144 N.E. (Mass.) 392.
These cases recognize, under a construction of the aforesaid section of the Bankruptcy Law, that this does not create a new claim, but changes the form of the claim from that of an unsecured note to a judgment which is provable in bankruptcy, thus settling the question as to the validity of the note, amount due, etc.
In Ingram v. Wilson, 125 Fed. 913, the Circuit Court of the 8th Circuit held that whatever relief the creditor was entitled to against a bankrupt, which was the homestead, under the laws of Iowa must be sought and obtained in that jurisdiction. The right to a personal judgment is not discussed.
In Roden Grocery v. Bacon, 133 Fed. 515, the matter involved was an instrument containing a waiver. The court said:
"Whether the bankrupt could avoid or defeat such contracts was for the state courts to decide, and the issue seems to us to be wholly immaterial in the bankruptcy court."
That opinion contains a paragraph in which the court says that the creditor did not have a lien on the property (the homestead).
In In re Maaget, 173 Fed. 232, the Federal District Court for the Southern District of New York held that a bankruptcy court may properly permit an attachment creditor, where the bankrupt has given a bond, to prosecute his action to judgment against the bankrupt for the purpose of perfecting his right of action against the surety, but no execution shall issue.
In the case of Simon Casady Company v. Hartzell, 171 Iowa 325, this court held, under the same circumstances, that no recovery could be had on such a bond.
The Circuit Court of Appeals in Chase v. Farmers Merchants Nat. Bank, 202 Fed. 904, said:
"We find nothing in the act to prevent a creditor from bringing his action upon a provable claim, even after adjudication. * * * Enforcement of the judgment in such a suit presents a different question, but with that we are not now concerned." *Page 248
In In re Buchanan, 219 Fed. 492, the creditors had, prior to the bankruptcy, commenced suit in the New York state court to reach that portion of the income of certain trust funds which was in excess of what was necessary for the bankrupt's support. It was held that the action might be prosecuted to judgment, but prosecution of the suit beyond judgment could not be permitted.
In Brown v. Four-in-One Coal Co., 286 Fed. 512, it was held that the suit might be prosecuted to judgment in the state court, but "of course (he), can have no execution issued against the bankrupt upon any judgment he may recover therein."
In In re Rabb, 21 Fed. (2d Series) 254, it was held that liens against the homestead of a bankrupt must be enforced in the state court.
Phillips v. Krakower, 46 Fed. (2d Ser.) 764, does not involve exempt property, but property owned in the entirety by the husband and wife. The case turned on the peculiar conditions and qualifications of an estate in entirety.
It will be seen from the above review of the cases that the uniform holding is that while a suit may be prosecuted to judgment in the district courts of the state, no execution may be issued thereon, and practically the only thing accomplished by such judgment is that it may be filed as a provable claim in bankruptcy with the issues settled as to its validity and the amount thereof.
We have no case cited to us, nor have we been able to find any from any court holding, under such circumstances, that suit may be maintained successfully in a state court to create a lien as distinguished from a suit to enforce an existing lien.
So far, we have yet to find a holding that a suit may be brought in equity on a promissory note without an accompanying lien, legal or equitable, and carried to a judgment in rem. Such contention, of course, has its novelty, but we are unable to find any authority or basis for warranting such an action.
The Federal Court, by its order staying discharge until this matter be determined in the state courts, could not and did not, by such order, create a remedy in equity for the appellants, and whatever rights they have must be used by them in the state court, where their sole and only remedy, under this set of facts, is a law and not an equity action. *Page 249
Of course, what has here been said with reference to liens must not be understood as applying to cases where the exemption is waived or the lien created on the exempt property by contract.
Further discussion of the question is not necessary, because the fundamentals underlying this case are fully settled and adjudicated in McMains v. Cunningham, 214 Iowa 300. It follows that the decree and judgment of the court below must be and they are affirmed.
WAGNER, C.J., and KINDIG, STEVENS, EVANS, and FAVILLE, JJ., concur.
MORLING, GRIMM, and De GRAFF, JJ., dissent.
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It must be found on this record that immediately prior to April 10, 1929, the Farmers National Bank, or the plaintiffs as its trustees, had a cause of action against the defendant on promissory notes upon which plaintiffs could then have maintained this action; that no discharge in bankruptcy has been granted and there is no defense to the action. On the date mentioned defendant was by the Federal court adjudged to be a bankrupt. By such adjudication all the defendant's non-exempt property passed into the jurisdiction of the court of bankruptcy and vested in the trustee. 7 C.J. 113. Title to the bankrupt's non-exempt property however did not vest in the trustee or come under the jurisdiction of the court in bankruptcy further than to the extent required to enable it to be set apart to defendant as exempt. 7 C.J. 362. On the admissions in the pleadings it must be found that the court in bankruptcy did shortly after April 10, 1929, adjudicate the property here in controversy to be the defendant's homestead and set it off to her. That adjudication was, as to her creditors, conclusive that on that date the property in question was defendant's homestead. On this record, however, it must be further found that the property was not homestead prior to that date. That is, defendant's homestead right exists solely by virtue of, and dates from, the adjudication of the court of bankruptcy, which, so far as we are now concerned, operates to exclude it from the jurisdiction of the Federal court, and to subject it to the jurisdiction of the state courts in a proper action involving it. It must be further found upon this record that the indebtedness *Page 250
to the plaintiffs, here sued upon, was contracted long prior to the acquisition of the homestead. A mere adjudication in bankruptcy does not bar proceedings in the state court. The adjudication of defendant's bankruptcy in no wise prevented the plaintiffs from commencing action to recover upon her indebtedness to the plaintiffs, or if not restrained by the court in bankruptcy from prosecuting it to judgment. 7 C.J. 349; Bankruptcy Act (30 Statutes at Large 562), Section 63; Woods v. Berry, (Cal.) 296 P. 332, 335; Tune v. Vaughan, (Ark.)281 S.W. 906.
The jurisdiction of the state court is entirely separate and independent of that of the Federal court. The Federal court might however under the bankruptcy law, in a proper case, stay the prosecution of the action in the state court. Application for such a stay however would be "addressed to the wise discretion of the district judge." Likewise an application for vacating the stay might be made and this too would be addressed to the discretion of the judge. In re Rosenstein, 276 Fed. 704; In re Gerstenzang, 52 F.2d 863; In re Kane, 48 F.2d 96.
That the bankrupt estate would have an interest in the property and reason for the application for stay would have to appear. Bushong v. Theard, 37 F.2d 690, certiorari denied,281 U.S. 763.
The stay if granted would not effect a dismissal of the action in the state court or defeat the cause of action. It would merely suspend proceedings in the state court so long as it is in force. New River Coal Land Co. v. Ruffner, 165 Fed. 881, 886.
The plaintiffs' right to a general judgment would be barred only in the event that a discharge in bankruptcy should be granted and the plaintiffs' claim should be dischargeable (which does not appear) and defendant should plead and prove it in the state court. Drees v. Armstrong, 180 Iowa 29; 7 C.J. 414.
After the property was adjudged to be defendant's homestead and set off to her the court in bankruptcy had no further jurisdiction with respect to it or to determine rights in it. All actions to establish or enforce rights in or liabilities against that property would have to be brought in and determined by the state court. Lockwood v. Exchange Nat. Bank, 47 L. Ed. 1061; *Page 251
Drees v. Armstrong, 180 Iowa 29; Johnson v. Turnholt, 199 Iowa 1331, and cases post.
Under the provisions of the bankruptcy law the adjudication in bankruptcy dissolved all liens created by or obtained in or pursuant to any suit or proceeding at law or in equity within four months before the filing of the petition in bankruptcy. Bankruptcy Law (30 Statutes at Large 564), Section 67.
It is said in C.B. Q.R. Co. v. Hall, 229 U.S. 511, 516;
"The section (67F) does not, however, defeat rights in the exempt property acquired by contract or by waiver of the exemption. These may be enforced or foreclosed by judgments obtained even after the petition in bankruptcy was filed, under the principle declared in Lockwood v. Exchange Bank,190 U.S. 294."
No such lien existed in this case. By the statute of this state, which the bankruptcy law does not purport to affect, Code Section 10155, "The homestead may be sold to satisfy debts * * * contracted prior to its acquisition, but then only to satisfy a deficiency remaining after exhausting the other property of the debtor liable to execution." Prior to the filing of petition in bankruptcy the plaintiffs, under the law of the state, had the unqualified right to sue the defendant to recover judgment and to have the homestead in controversy sold to satisfy it, provided there was no other property liable to execution, as to which matter no question has been raised here. The statute does not provide specifically how, or by what proceedings, "the homestead may be sold." The method must, therefore, be through action, judgment and final process for judicial sale. Prior to the filing of the petition in bankruptcy therefore the plaintiffs had the right to bring action for the recovery of judgment, issuance of execution and sale of property. There is no provision of the state law by which this right and remedy may be suspended, barred or defeated by an adjudication in bankruptcy or by any action of any other jurisdiction. The plaintiffs' right of action and to have the homestead sold is exclusively under the state law. The jurisdiction of the state courts is exclusive. The court in bankruptcy or any other Federal court or any Federal law has nothing whatever to do with the case. *Page 252
The bankruptcy court is in no wise concerned because no assets within its jurisdiction, or which it may administer, will be affected by any action taken in the state court to subject the property to the claim of the plaintiffs further than that if plaintiffs are successful the amount of the bankrupt's indebtedness to them would be reduced and the other creditors to that extent would if there were other assets be benefited rather than prejudiced. The bankruptcy court has not stayed proceedings in the state court and on this record there would be no occasion in any event for it to exercise its discretionary power to grant a stay.
It is the duty of the courts of the state to administer and enforce its laws and the rights of all persons under them. The plaintiffs brought action at law, took out a writ of attachment and levied it upon the property in controversy. This was done, however, after the expiration of the four months and after the bankruptcy court had renounced and terminated all jurisdiction ever it. The lien of the attachment, therefore, was not one which was dissolved by the provisions of the bankruptcy act. However, the plaintiffs have amended and are now prosecuting their action in the form of a creditor's bill. The defendant is indebted to the plaintiffs. The defendant contends that plaintiffs are not entitled to a personal judgment against her. As the case stands at the present time plaintiffs are entitled to that judgment because no discharge has been granted, and no interference with the process of the Federal court which comity should respect will result.
We may say at this point that under the Federal law the bankruptcy court observed proper practice by entering an order withholding the discharge of the defendant pending the determination of the rights of all parties in the state court. Brown v. Four-in-One Coal Co., 286 Fed. 512.
In Phillips v. Krakower, 46 F.2d 764, 765, (C.C.A.) it is said:
"The question presented is whether, without giving these creditors an opportunity to proceed, the court should grant the discharge knowing that it will result in a legal fraud, i.e. the effectual withdrawing of the property from the reach of those entitled to subject it to their claims, for the beneficial ownership and possession of those who created the claims against it. *Page 253
We cannot conceive that any court would lend its aid to the accomplishment of a result so shocking to the conscience.
"The purpose of the bankruptcy act was to equitably distribute the assets of distressed debtors among their creditors and to discharge them from further liability after this had been done. It was never contemplated that it should be used to perpetuate fraud or to shield assets from creditors. It is elementary that a bankrupt is not entitled to a discharge unless and until he has honestly surrendered his assets for the benefit of creditors; and he certainly is not in position to ask a court of bankruptcy, which is a court of equity, to grant him a discharge under the statute, when the effect of the discharge will be to withdraw from the reach of creditors property properly applicable to the satisfaction of their claims. * * * There is ample authority for the proposition that where property is not reachable through bankruptcy, but can be reached by a creditor under state laws, the court of bankruptcy should delay granting a discharge to the bankrupt to enable the creditor to proceed thereunder in the state courts. Lockwood v. Exchange Bank, 190 U.S. 294, 23 S. Ct. 751, 754, 47 L. Ed. 1061; Duffy v. Tegeler (C.C.A. 8th) 19 F.2d 305; In re Watson (D.C.) 201 F. 962; B.F. Roden Grocery Co. v. Bacon (C.C.A. 5th) 133 F. 515. Ingram v. Wilson (C.C.A. 8th) 125 F. 913; In re Wells (D.C.) 105 F. 762.
"In Lockwood v. Exchange Bank, supra, the facts were that a bankrupt had executed a note waiving his homestead exemption in favor of the payee. The Supreme Court held that the property covered by the exemption remained in the bankrupt and did not pass to the trustee to be administered in the bankruptcy proceedings. It was property, therefore, which was reachable by the creditor in the state courts, but, as here, the right of the creditor to subject it to his claim would be lost if the bankrupt were granted a discharge and his debt thereby extinguished. In this situation, it was held that the court of bankruptcy should defer the granting of the discharge for a reasonable length of time to allow the creditor opportunity to subject the property to the satisfaction of his claim. The court, speaking through Mr. Justice White, said:
"`The rights of creditors having no lien, as in the case at bar, but having a remedy under the state law against the exempt *Page 254
property, may be protected by the court of bankruptcy, since, certainly, there would exist in favor of a creditor holding a waiver note, like that possessed by the petitioning creditor in the case at bar, an equity entitling him to a reasonable postponement of the discharge of the bankrupt, in order to allow the institution in the state court of such proceedings as might be necessary to make effective the rights possessed by the creditor.'
"There is no difference in principle between that case and the case at bar. In both there was property which did not pass to the trustee, but was reachable by the creditor under the laws of the state. In both a discharge of the bankrupt would have precluded a proceeding to subject the property to the satisfaction of the debt. And in both a stay of the discharge was asked in order that the property might be subjected to the claims of the creditor. Counsel for Phillips attempt to draw a distinction in that the bankrupt in the Lockwood case had signed a waiver expressly consenting that the homestead property be subjected to the debt; but in the case at bar bankrupt, by signing the note with his wife, gave his consent to the subjection of the property held by entireties to its satisfaction. The basis upon which relief is granted in either case, however, is, not that the bankrupt has consented that property be subjected to the claim of the creditor, but that an equity exists in favor of the creditor because he is entitled to subject property to the satisfaction of his claim and this right will be extinguished by the granting of the discharge."
That case was one to subject the interest of the bankrupt in an estate by entireties which did not pass to the trustee. The principle there announced is general and fully applicable here. Drees v. Armstrong, 180 Iowa 29.
The bankruptcy proceedings may ultimately result in defendant's discharge from her dischargeable debts. Whether any or all of the indebtedness to the plaintiffs is dischargeable does not appear. It has been held that notwithstanding a discharge in bankruptcy the state court is the proper forum to determine whether the debt there sued upon, to which the discharge is pleaded in bar, was one thereby discharged. Wheeler Motter Mere. Co. v. Green, (Okla.) 222 P. 965.
Whether this is correct or not does not now call for *Page 255
discussion. The plaintiffs have seen fit to amend and to seek relief in equity by way of creditor's bill. The plaintiffs have the right to have this property sold for the payment of defendant's indebtedness to them. If they are not entitled to a writ of attachment, or to personal judgment and general execution as defendant claims, then there is no remedy at law. It is a maxim of equity that equity will not suffer a wrong to be without a remedy. Pomeroy (Vol. 1, 3d Ed., Sec. 423) says that:
"This principle, which is the somewhat restricted application to the equity jurisprudence of the more comprehensive legal maxim, Ubi jus ibi remedium, — wherever a legal right has been infringed, a remedy will be given, — is the source of the entire equitable jurisdiction, exclusive, concurrent, and auxiliary. * * * Section 424. * * * In order that the principle may apply, one of three facts must exist, viz., either, — 1. The right itself must be one not recognized as existing by the law; or 2. The right existing at the law, the remedy must be one which the law cannot or does not administer at all; or 3. The right existing at the law, and the remedy being one which the law gives, the remedyas administered by the law must be inadequate, incomplete, or uncertain. Of these three alternatives, the first and second denote the exclusive jurisdiction of equity; the third, the concurrent jurisdiction. The third limitation upon the principle is, that it does not apply where a party, whose case would otherwise come within one of the three alternatives above mentioned, has destroyed or lost or waived his right to an equitable remedy by his own act or laches. With these limitations upon its operation, the principle has been developed into the vast range of the equitable jurisdiction, which, considered in its entirety, gives, — 1. Legal remedies for the violation of legal rights in a more certain, complete, and adequate manner than the law can give; 2. Equitable remedies for the violation of legal rights, which the law has no power to give with its means of procedure; and 3. Remedies, either equitable or legal in their nature or form, for the violation of rights of which the law takes no cognizance, — rights under which the law does not recognize as existing, and which it either cannot or does not protect and maintain."
Creditor's bills are quasi in rem. A judgment is not *Page 256
indispensable where it is impossible or impractical. 15 C.J. 1390.
In Taylor v. Branscombe, 74 Iowa 534, 536, it is said:
"It has been held that a creditor's bill may be maintained, without judgment or attachment, in case the debtor is a nonresident, as were defendants in this case," (citing cases.)
In that case an attachment had been issued but no judgment recovered.
In 21 C.J. 198, it is said:
"In accordance with the maxim, where a statute creates a new right which cannot be adequately enforced at law, equity will contrive remedies and orders to enforce it, unless the statutory remedy is exclusive as determined by the usual rules. * * * The fact that there has been no precedent will not deter a court of equity from awarding relief in a proper case."
In the Note are quotations:
"`The jurisdiction of a court of equity does not depend upon the mere accident whether the court has, in some previous case or at some distant period of time, granted relief under similar circumstances, but rather upon the necessities of mankind, and the great principles of natural justice, which are recognized by the courts as a part of the law of the land, and which are applicable alike to all conditions of society, all ages, and all people. * * * Where it is clear the circumstances of the case in hand require an application of those principles, the fact that no precedent can be found in which relief has been granted under a similar state of facts is no reason for refusing it.'"
"`Every just order or rule known to equity courts was born of some emergency, to meet some new conditions, and was, therefore, in its time, without a precedent. If based on sound principles, and beneficent results follow their enforcement, affording necessary relief to the one party without imposing illegal burdens on the other, new remedies and unprecedented orders are not unwelcome aids to the chancellor to meet the constantly varying demands for equitable relief.'"
"`Though no precedent may be at hand in a given situation, since principles of equity are so broad that the wrong involved need not go without remedy, its doors will swing open for the *Page 257
asking, and a new precedent be made, an old principle again being illustrated.'"
If a discharge were granted and the debt to plaintiffs were dischargeable in bankruptcy the legal relationship of debtor and creditor between plaintiffs and defendant would thereby terminate and plaintiffs would be without remedy. Drees v. Armstrong,180 Iowa 29; Tune v. Vaughan, (Ark.) 281 S.W. 906.
It is said in Groves v. Osburn, (Or.) 79 P. 500:
"Where there is a lien, as in the case of a mortgage, it may be enforced, although the debt is barred by the statute of limitations; but where there is no lien, and the debt is barred, a remedy that was alone at law is entirely lost. So it must be in the present case, the debtor having been discharged by the bankruptcy proceeding before the plaintiff attempted to enforce her demands, her remedy is entirely swept away, unless the bankrupt has waived the discharge. If prior to the bankrupt's discharge plaintiff had taken proper action with a view to subjecting this property to the payment of her demands, there is little question that the federal court would have withheld the discharge until ample opportunity would have been afforded for the accomplishment of the purpose, and the remedy at law would perhaps have been adequate. * * * But having waited until the debts were themselves discharged, she is now remediless in either forum."
But the plaintiffs are entitled to at least a special or limited judgment by which the court will adjudicate and declare the amount of defendant's indebtedness to plaintiffs, establish it as a special lien upon the land and direct the issuance of special execution and sale of the land thereunder. In its discretion the court may grant a perpetual stay of general execution if the defendant should be granted a discharge in bankruptcy.
In Hill v. Harding, 130 U.S. 699, 703, it is said:
"When the attachment remains in force, the creditors, notwithstanding the discharge, may have judgment against the bankrupt, to be levied only upon the property attached. Peck v. Jenness, 7 How. 612, 623; Doe v. Childress, 21 Wall. 642. When the attachment has been dissolved, in accordance with the statutes of the State, by the defendant's entering into a *Page 258
bond or recognizance, with sureties, conditioned to pay to the plaintiffs, * * * the amount of that judgment, the question whether the state court is powerless to render even a formal judgment against him for the single purpose of charging such sureties, or, in the phrase of Chief Justice Waite in Wolf v. Stix, 99 U.S. 1, 9, whether `the judgment is defeated by the bankruptcy of the person for whom the obligation is assumed' depends not upon any provision of the Bankrupt Act, but upon the extent of the authority of the state court under the local law. Whether that authority is exercised under the settled practice of the court, as in Illinois, or only by virtue of an express statute, as in Massachusetts, there is nothing in the Bankrupt Act to prevent the rendering of such a judgment. The bond or recognizance takes the place of the attachment as a security for the debt of the attaching creditors; they cannot dispute the election, given to the debtor by statute, of substituting the new security for the old one; and the giving of the bond or recognizance, by dissolving the attachment, increases the estate to be distributed in bankruptcy. The judgment is not against the person or property of the bankrupt, and has no other effect than to enable the plaintiff to charge the sureties, in accordance with the express terms of their contract, and with the spirit of that provision of the Bankrupt Act which declares * * * If the bond was executed before the commencement of proceedings in bankruptcy, the discharge of the bankrupt protects him from liability to the obligees, so that, in an action on the bond against him and his sureties, any judgment recovered by the plaintiffs must be accompanied with a perpetual stay of execution against him; but his discharge does not prevent that judgment from being rendered generally against them. * * *"
Following that case the power of the state court to render a limited judgment, adaptable to the circumstances of the case and protecting the bankrupt against general execution or liability after discharge, has often been announced. United States W.E.
P. Co. v. North Penn Iron Co., (Pa.) 75 A. 1094; Clauss v. Ainey, (Pa.) 124 A. 183; Butterick Pub. Co. v. E.F. Bowen Co., (R.I.) 80 A. 277; Brown Brown Coal Co. v. Antezak, (Mich.) 128 N.W. 774; 130 N.W. 305; Laure v. Singer, (N.J.) 125 A. 243; Brown v. Four-in-One Co., 286 *Page 259
Fed. 512; Goodwin Sigel v. Boston Clothing Co., (R.I.)129 A. 611; In re Rosenstein, 276 Fed. 704.
As plaintiffs are here by attachment and by creditor's bill the matter of practice need not be further considered.
Referring further to specific applications of these principles to similar cases. In Bell v. Dawson Grocery Co., (Ga.) 48 S.E. 150, the bankrupt had given a note waiving homestead and exemptions. It was held:
"(1.) The court of bankruptcy has no control over the exemption after it has been set apart, or power to determine the rights of creditors asserting waivers against it. (2) The court of bankruptcy, upon proper application, will withhold A's discharge until B has time to resort to such remedies as may be granted by the state courts. (3) Inasmuch as, on account of the adjudication in bankruptcy B cannot sue A at common law and obtain a judgment against him, and inasmuch as A is estopped by his waiver to claim an exemption as against B, the latter's remedy is in a court of equity, which court is authorized, under the laws of this state, to give B a judgment in rem against the exempted property, subjecting it to his claim, and, where such property is personalty of a perishable nature, or such as will be destroyed in the use, to appoint a receiver to take charge of such property until the judgment in rem has been obtained."
In Hudson v. Lamar, Taylor Riley Drug Co., 49 S.E. (Ga.) 735, it is held, following that case, that the remedy was in equity, not at law.
In Northern Shoe Co. v. Cecka, 135 N.W. 177, 22 N.D. 631, plaintiff sued for the price of shoes bought by defendant and attached the goods. Defendant filed petition in bankruptcy. The claim was allowed. Plaintiff released its attachment. A part of the goods which had been attached were set off to defendant as exempt. No objection was made by plaintiff or others. Plaintiff afterwards commenced a second action in the state court to recover the same debt and caused a second attachment to be issued, which was levied upon the same goods seized under the first writ. Plaintiff's right to maintain the action was sustained on the authority of Powers Dry Goods Co. v. Nelson,10 N.D. 580, 88 N.W. 703, 58 L.R.A. 770.
In Powers Dry Goods Co. v. Nelson, 88 N.W. (N.D.) 703, *Page 260
defendant filed petition in bankruptcy June 23. Plaintiff commenced his suit in the state court June 27 and levied upon the goods sold by it to defendant. On July 2nd defendant was adjudged a bankrupt. On August 6th the bankruptcy court required the trustee to set aside to defendant as exempt the attached property, which was done. Afterward plaintiff caused another attachment to be issued and levied on the same property. Afterward defendant was discharged in bankruptcy. It was held that the title to the exempt property remained in the bankrupt subject to the jurisdiction of the state court; that the lien of the attachment on the exempt property was not discharged. The court cites many cases, among them Bank of Commerce v. Elliott, (Wis.) 85 N.W. 417, which was an action to recover on a note. Defendant pleaded discharge. Plaintiff garnished wages. One of the garnishments was within 4 months of adjudication in bankruptcy. Defendant was discharged in the bankruptcy. The court said:
"Coming now to the question of whether a liberal construction of the word `lien,' as it is used in the bankrupt act, can reasonably extend it to include a special interest of so shadowy a character that it does not attach to any particular thing, as does such an equitable interest as a mortgage, but only enables the court to act upon the party holding the res, we must look at the matter in the light of the commonly accepted character of the right of a plaintiff in garnishee proceedings and the name such right has commonly borne.
"The courts have uniformly said, as before indicated, that the service of a garnishee process is an equitable levy upon the property of the debtor in the hands of the garnishee and that the interest thereby obtained in such property is at least in the nature of an equitable lien, and has been commonly called a lien. * * * So the plaintiff in a garnishee case, as it seems, does acquire a special interest, even in a mere indebtedness of the garnishee to the defendant, denominated a lien, regardless of the diversity of opinion as to its real character," etc.
The discharge was held not to affect the garnishment.
Gregory v. Cale, 133 N.W. 75 (Minn. and L.R.A.), was an action to recover on a note and to subject homestead. Defendant within a few days after the commencement of the action was adjudged *Page 261
a bankrupt and was later discharged, plaintiff having in the meantime obtained a judgment. The court said:
"Whether the judgment was annulled by the discharge in bankruptcy depends entirely upon the question whether it became, when docketed, a valid lien upon that part of the homestead assigned in the bankruptcy proceedings which was subject to the payment of this particular debt. If it so became a valid lien, the discharge in bankruptcy extinguished it only so far as concerned defendant's personal liability. The right to enforce the judgment against the specific property, not a part of the bankrupt estate, was not thereby extinguished or discharged. * * * Whether the judgment became a lien upon the non-exempt land must be determined from our statutes upon the subject, and without reference to the bankruptcy proceedings in the federal court. Plaintiff brought its action in the state court, as it had the right to do. It was an ordinary action at law for the recovery of money, and though it might have been stayed by proper application pending the bankruptcy proceedings, and plaintiff thus put to an equitable action to reach the nonexempt land, no stay was applied for, and the action proceeded to judgment. It did not, of course, operate upon or become a lien upon any of the property of defendant which passed upon the adjudication in bankruptcy to the bankrupt estate; nor did it create a personal liability against defendant, continuing after his discharge. But that it became a valid lien upon that part of the defendant's land which did not pass to the bankrupt estate because a part of the homestead under the then existing statutes, that part of the present homestead which was subject to the payment of the debt when created, seems to us quite clear."
In B.F. Roden Grocery Co. v. Bacon, 133 Fed. 515, C.C.A., after the bankrupt filed his petition in bankruptcy and was adjudged a bankrupt, Roden issued an attachment from the Court of Alabama alleging waiver of exemption and levied it upon property claimed as exempt. The bankrupt set up that the attachment was issued subsequently to the adjudication and before the exemption had been set aside. The court said:
"While the creditor holding a waiver note given by a bankrupt has no lien on specified property — in fact, no lien at all — and the debt represented by such note is one within the purview *Page 262
of the bankrupt law, to be discharged by proper proceedings thereunder, yet the rights of said creditor are to be so far recognized as to require the withholding of the bankrupt's discharge a reasonable time to permit the creditor to assert in the proper state tribunal his alleged right to subject the exempt property to the satisfaction of his claim. * * * This being the case, it would seem that it is to the interest of the general creditor's that such right should be prosecuted and enforced pending the bankruptcy, and prior to proof of debt, to prevent the creditor holding the waiver from taking a dividend on his whole claim from the general assets, and thereafter availing himself of the right resulting from the waiver to proceed against the exempt property.
"As the creditor holding a waiver may proceed to assert his right in a state tribunal pending the proceedings in bankruptcy, it follows that the form his action may take in the state tribunal is of no concern in the bankruptcy court, unless such writs are issued and proceedings had as directly interfere with property passing to the trustee in bankruptcy, or with exempt property not claimed by the bankrupt and in actual custody of the bankruptcy court. * * * Whether the bankrupt could avoid or defeat such contracts was for the state courts to decide, and the issue seems to us to be wholly immaterial in the bankruptcy court."
In Bank of Mendon v. Mell, (Mo. App.) 172 S.W. 484, 486, which was a replevin on a mortgage given within four months of adjudication, the court said that when the trustee set apart to defendant his exemptions it put the bankrupt "in possession of what he owned, and it remained unaffected by the bankruptcy proceeding, and consequently subject to the mortgage as fully as if there had been no bankruptcy. * * * We think nothing detrimental to plaintiff can be made out of this. [The adjudication that the mortgage was an unlawful preference.] Manifestly the court was only adjudicating that over which it had jurisdiction. The execution of the mortgage for the property not exempt was an act of bankruptcy. But a conveyance of exempt property could not affect or influence bankruptcy proceedings, nor could such proceedings affect such conveyance; and the only authority of a court of bankruptcy over that class of property is to set apart to the debtor `what, after a hearing, may be found to be exempt.' * * * The exempt property in controversy having been *Page 263
restored to the defendant by the bankruptcy court, it retained the incumbrance which he had placed upon it before that court took possession of it. If that incumbrance was valid, under our state law, it may be enforced in our state courts."
For further cases see Brooks v. Eblen, (Ky.) 106 S.W. 308; In re Stern, 208 Fed. 488; Ingram v. Wilson, 125 Fed. 913; Bowen v. Keller, (Ga.) 60 S.E. 174; Brooks v. Britt-Carson Shoe Co., (Ga.) 65 S.E. 411; Groves v. Osborn, (Ore.) 79 P. 500; Lyon v. Herboth, (Wash.) 233 P. 24; 2 Rem. Bankruptcy, Section 1106; Id. Section 1108; Lafferty v. Patton, 14 Pa. Dist. 255; Tyler v. Parliman, 14 Pa. Dist. 517; J. Saul Co. v. Bowers, 117 S.E. (Ga.) 86; Thompson-Ritchie Grocery Co. v. Cary, 135 So. (La.) 707; Schexnailder v. Fontenot, 85 So. (La.) 207.
Whether or not there are other creditors in like situation, and whether they might or ought to be brought into this case, are matters not raised.
I think the judgment should be reversed.
De GRAFF and GRIMM, JJ., concur in this dissent.
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Appellee filed a motion to dismiss this appeal because of total failure to observe Rule 30, which motion was submitted with the case. That there must be some attempt, at least, to comply with Rule 30 of this court in presenting an appeal in a law case has been pointed out so often that no citation of authorities is necessary. In this case, no attempt whatever *Page 294
was made to comply. Appellant makes no claim that Rule 30 was followed. Appellant's only answer to the motion to dismiss is that this case was tried in equity by stipulation of the parties.
Here is what the record shows: Jury was waived by agreement of the parties; said cause was fully submitted to the court and the following proceedings had and taken:
"Plaintiff's Evidence". (Here follows record of admissions by way of stipulation between the parties constituting proof of plaintiff's cause of action in chief)
Then follows: "Defendant's Evidence".
Counsel offered in evidence Exhibit 11 which was objected to as incompetent.
"The Court: Do you want me to rule as in a law case, or let the objection stand?
"Mr. Marshall: It is a law case, and I think we better agree that the court may rule. I do not suppose the court would want to rule.
"The Court: We might receive it subject to the objections the same as in an equity case.
"Mr. Cullison: Alright, we will not make any objection.
"The Court: You can make your objections.
"Mr. Marshall: It is agreed that all objections may be received and ruled upon by the court as in an equity case."
The court proceeded with the hearing. Objections were made without any rulings thereon at the time entered or at any other time. The case was taken under advisement and on October 8, 1937, there was duly entered record entry entitled: "Judgment Entry" which recites:
"On this 8th day of October, 1937 this cause came on in regular order for final judgment, it having heretofore been fully submitted to and taken under advisement by the Court, the parties hereto having waived a jury and tried the case to the Court."
Then follows several pages of finding of facts by the court from which the court determined that the plaintiff was not entitled to recover and proceeded to enter an order dismissing plaintiff's petition and rendering judgment against plaintiff for costs "to all of which the plaintiff at the time duly excepts." *Page 295
The question is: Does this process convert a law case into an equity case triable in this court de novo? We do not think so. It is still a law case and on appeal the rules of procedure applicable to a law case must be followed. This was not done. No assignments of error were made.
The action was essentially one at law to recover money judgment only. It was brought as a law action and entitled "At Law"; it was so recognized by the parties and trial court and a jury was expressly waived. It was perhaps competent for the parties, with the consent of the court, to waive the manner of trial in the reception of evidence and ruling on objections, — (Baker v. Jamison, 73 Iowa 698, 36 N.W. 647) — a practice not to be encouraged — but even so, this did not amount to an agreement to try the case as an equity action. In the case of Hostler Coal
Lumber Co. v. Stuff, 205 Iowa 1341, 219 N.W. 481, the stipulation was as follows: "By agreement jury waived and case to be tried to the court. By agreement the case to be tried in same manner as an equity case." The court held that this language, in the light of the record, was not equivalent to "as an equity cause" and refused to hear the case de novo.
We do not lose sight of the fact that under our prior decisions if a law case is brought upon the theory that it is one of equitable jurisdiction and so tried without objection it will be so treated on appeal in this court. Clearfield Bank v. Olin,112 Iowa 476, 84 N.W. 508; Steltzer v. Railway, 167 Iowa 464,149 N.W. 501.
The proper procedure is to have a record entry transferring the case from the law to the equity docket or vice versa, but this should not be tolerated indiscriminately. It is not contemplated by our state constitution (Art. V, Sec. 4) nor by the provisions of our statute (section 11431, Code of Iowa, 1935) that law actions be tried in this court except on errors duly assigned and presented and the method of doing this is pointed out by Rule 30 of this court.
The motion to dismiss is accordingly sustained. — Appeal dismissed. *Page 296
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[1] The accident under consideration occurred about 10 o'clock on the night of July 19, 1930, on Main street in the City of Lyons. On the evening in question the plaintiff and a young lady companion were riding for pleasure in the automobile of the plaintiff. Main street extends east and west and is a part of the Lincoln Highway. The railway of the defendant-Company extends north and south in this part of the city. The train schedule of the defendant included a passenger train arriving from the north in the city of Lyons at about 10 P.M. At about that time the plaintiff and his companion were traveling east on Main street. This street was traversed by the defendant's railway. At a point four blocks west from the railroad crossing, the plaintiff and his companion heard the whistle of the approaching passenger train and commented thereon in their conversation. The plaintiff was a long-time resident of the city and was familiar with the locality and with the train time. From the point at which he heard the train whistle, he drove east across the railroad tracks and one block further. This brought him to the bridge across the Mississippi River. At this point he turned back on the same street and drove west along its north side and proceeded to cross the railroad track a second time. At this intersection there were three railroad tracks side by side, twelve or thirteen feet apart. Of these three tracks the westerly one was that of defendant. *Page 829
At a distance approximating forty to forty-eight feet east from the railroad tracks, a complete and unobstructed view of the railroad tracks to the north was available. At this point a view of the tracks could be had for several hundred feet. The plaintiff testified that at this point while going west he looked up the track for the train and saw none. He thereupon proceeded to the crossing and without seeing the approaching train at any moment he drove in front of the locomotive at the very instant of its arrival at the same spot. His first knowledge of the presence of the locomotive was obtained by the crash of the collision. The train was in fact in plain view at the time the plaintiff looked for it in the first instance and was in plain view at the very moment that the plaintiff drove upon the track. The locomotive carried the regular headlight and an automatic bell; the street was lighted by four large electroliers; the cars of the train were all lighted. The first contention presented to us by the appellant is that the plaintiff was guilty of contributory negligence, and we give the question our first consideration.
The explanation given by the plaintiff, as a witness, for his failure to see the train and its headlight when he looked in the first instance was that the visor of his automobile was so placed that it interfered with his vision. His claim is that the visor of his car obstructed his view so that at a distance of fifty feet he could see nothing at an elevation greater than ten feet. He testified in effect that when he looked for the train in the first instance, he could see as far as Pearl Street, one block north; that if the locomotive had been at Pearl Street at that time he could have seen its headlight; that if the locomotive was closer to him than Pearl Street, then he could not see its headlight because his line of vision would be lower than the elevation of the headlight. In other words he testified that he could not see a locomotive headlight if the locomotive were closer to him than the distance of one block. Such is his answer to his failure to see. The question naturally arises, of what avail was it to require him to look for the train before passing upon its tracks, if the train became invisible when it approached within two hundred feet of him. There is one infirmity in this recital of fact. His visor obstructed his view only to the west. In looking for the train he must look to the north. Both his windows were open. In any event we think the purported excuse is not available. Where there is a duty to look, there is a duty tosee what is plainly visible. The looking may not be done with closed eyes. If the visor acted *Page 830
as a drooping eye-lid for the car, it was no more permissible than a closed eye-lid would be for the plaintiff himself. According to the explanation made, the plaintiff knew when he looked that he had no vision of the locomotive or its headlight for the space of one block nearest to him. The very proximity of the train became plaintiff's excuse for not seeing it. Legal duty may not be thus evaded or excused. At the very time the plaintiff purported to look, the locomotive was less than one hundred feet distant from him. The plaintiff testified that he proceeded from that point toward the crossing at ten miles per hour. His witness testified that the train was approaching the crossing at from ten to fifteen miles an hour. The locomotive was in the plain view of plaintiff's witnesses, who estimated its speed. The plaintiff had his car in good control and could have stopped in a moment. At the instant that plaintiff entered upon the rails, the locomotive was so close to him that he could have touched it with an ox-goad, yet he neither saw it nor heard it until the crash of the contact awakened him.
[2] Inasmuch as he failed either to see what was plainly visible or to hear what was clearly audible, he is deemed under the "physical evidence" rule not to have looked or listened at all.
Furthermore his negligence was greatly emphasized by the fact that he and his companion had heard the whistle of the train in its approach to the crossing while he was traveling easterly toward such crossing the first time. In the time elapsing before the collision, he traveled six blocks. During all that time he knew that the train would reach the crossing very soon.
We see no escape for the plaintiff from the charge of contributory negligence. Beemer v. C.R.I. P.R. Co., 181 Iowa 642; Yetter v. C.R. M.C.R. Co., 182 Iowa 1241; Anderson v. Dickinson, 187 Iowa 572; Sackett v. C.G.W.R. Co., 187 Iowa 994; Swearingen v. U.S. Rd. Adm., 191 Iowa 1096; Ballard v. C.R.I.
P.R. Co., 193 Iowa 672. The motion of the defendant for a directed verdict on the ground of contributory negligence, should have been sustained.
The judgment below is accordingly — Reversed.
STEVENS, C.J., and De GRAFF, ALBERT, KINDIG, WAGNER, and BLISS, JJ., concur.
FAVILLE and CLAUSSEN, JJ., take no part. *Page 831
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The case was tried below upon a stipulation of facts from which it appears that the parties were unable to agree upon an amount to be paid as damages for the right of way; that, following their failure to so agree, appraisers were appointed 1. EMINENT by the county auditor to assess the damages; DOMAIN: that same were awarded by the appraisers in the compen- sum of $1,500; that the board, by resolution, sation: attempted to reduce this amount to $1,200; that compromise subsequently thereto, and on November 14, 1923, settlement. before possession was taken by the county, appellee signed an instrument denominated an "Easement for Public Highway," conveying to the county the strip desired for an expressed consideration of $1,200. This amount, as stated in the deed, comprised the following items:
"Right of way 1.35 acres $300.00 $405.00
Fence 107 rods 2.50 267.50
Damage 527.50
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Total $1200.00"
The stipulation of the parties further recited that appellee did not, by agreement, expressly waive her right to recover the balance of the award.
The award of commissioners or appraisers in condemnation proceedings is not binding upon the county or other body having *Page 789
the right of eminent domain, and payment thereof need not be made unless possession is sought. In the absence of a stipulation to the contrary, as in this case, judgment can be entered in the district court upon appeal from the award of the appraisers for costs only. Klopp v. Chicago, M. St. P.R. Co., 142 Iowa 474;Hartley v. Keokuk N.W.R. Co., 85 Iowa 455; Richardson v. Cityof Centerville, 137 Iowa 253; Section 2011, Code of 1897.
Section 1527-r3, Code Supplemental Supplement, 1915, relating to highways, provides that:
"If the amount of damages so awarded are, in the opinion of the board, excessive, the proceedings shall be dismissed."
The statute imposes no limitation upon the power of the board of supervisors to negotiate a settlement with the owner of the property for a smaller amount than that allowed by the appraisers, and, if such owner consents to a reduction thereof, and executes a deed conveying a right of way to the county, we perceive no theory upon which a recovery of the balance of the award could be enforced in an action either at law or in equity therefor.
This, of course, is elementary, and appellee does not contend to the contrary. Neither waiver nor agreement to compromise is pleaded by appellants in their answer. The action of the board of supervisors reducing the amount to $1,200 was without authority and void. Daniel v. Clarke County, 194 Iowa 601. This is not, however, decisive of the questions before us. The instrument executed by appellee, it seems to us, will bear but one construction. The transaction resulting in its execution was independent, and subsequent to the award and the adoption of the resolution of the board attempting to reduce the amount to $1,200. The consideration expressed in the deed is, of course, subject to explanation by parol, but, in the 2. CONTRACTS: absence of proof on this point, it is considera- presumptively correct. This is especially true tion: where the instrument on its face expresses the conclusive consideration in items specifically covering the presumption. matter in dispute. No claim is made by appellee that she was not familiar with the terms of the deed, or that fraud was practiced by appellants in procuring her signature thereto. As possession was not taken on behalf of the *Page 790
county until after the easement deed was executed and delivered, we think the only reasonable inference to be drawn from all the facts and circumstances shown in the evidence is that the entry was under the deed, and not by virtue of the condemnation proceedings, although they may not have previously been actually dismissed. The resolution adopted by the board was, in effect, a rejection of the award, as well as a finding that it was excessive. Resner v. Carroll County, 126 Iowa 423, relied upon by appellee, which merely holds that the liability of a county for the services of a physician employed by a local board of health to attend a person afflicted with a contagious disease becomes absolute, when allowed by the board of health, and cannot thereafter be reduced by the board of supervisors, is hardly in point. The claim in the Resner case was an absolute indebtedness, whereas the claim of appellee became binding upon the county only by acceptance, either express or implied. The board of supervisors had a perfect right to abandon the condemnation proceedings by failing to pay the award or to dismiss the proceedings.
We are unable to concur in the result reached below, and the judgment there entered is — Reversed.
FAVILLE, C.J., and De GRAFF and VERMILION, JJ., concur.
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[1] On October 19, 1942, the appellant, Albert Wilson, and his brothers Glenn and Clarence were jointly indicted by the grand jury of Mahaska county for the crime of murder, in that they did "wilfully, deliberately, feloniously, and with premeditation and malice aforethought, and with specific intent to kill, murder one Harry Bolden," on June 15, 1942. They were tried separately. Glenn was found guilty on December 2, 1942, of murder in the first degree. The judgment on the verdict was reversed. State v. Glenn Wilson, 234 Iowa 60, 11 N.W.2d 737. It appears from the arguments in this appeal that Glenn was tried on the charge of manslaughter, under the indictment, and acquitted by the jury on December 6, 1944, because he killed in self-defense. Albert was tried for murder and the jury on February 4, 1943, found him guilty of manslaughter. Clarence was later tried under the indictment and on April 2, 1943, was found guilty of manslaughter. On his appeal this judgment was reversed. State v. Clarence Wilson, 235 Iowa 538, 17 N.W.2d 138.
Appellant asks for a reversal because of two errors of the court, the first one being the court's refusal to permit him to offer evidence that the general reputation of the deceased as a quarrelsome man in the community in which he lived at and prior to June 15, 1942, was bad.
The second error was the admission by the court of certain oral declarations of Glenn Wilson, and also his written statement, setting out his participation in the killing of Bolden and matters leading up to it, including the striking of Bolden with a club. All of these statements were made after the homicide and not in the presence of Albert Wilson. The admission of the testimony was objected to as being hearsay and incompetent.
The evidence of what took place on this occasion was more fully gone into in the trial of Glenn Wilson and is set out in our opinion on that appeal. (234 Iowa 60, 11 N.W.2d 737.) The principles of law involved in both of the assigned errors were *Page 431
fully discussed and stated in our opinion in State v. Clarence Wilson, 235 Iowa 538, 17 N.W.2d 138, and sustain the contentions of the appellant with respect to the law applicable thereto. The same errors were assigned by Clarence Wilson on his appeal and the judgment was reversed because of those errors. But on this appeal the State contends that certain matters of fact render those principles of law inapplicable. It is therefore necessary to state the pertinent evidence, as shown by the record in this case, bearing upon the first assigned error.
I. There was evidence of the following matters: The three Wilson brothers, immediately prior to Monday, June 15, 1942, had returned from Cleveland, where they had been working in the shipyards, to Oskaloosa, preparatory to entering the military service. Albert was forty-one years old. He enlisted in that service on October 3, 1942. Glenn was thirty-eight. About midafternoon on Monday, Glenn purchased some whisky and the three Wilsons, Andrew Rogers, a colored unmarried man, and Ballinger and McFarland, rode in a car of one of the Wilsons to the Rogers' two-room house. The party continued until in the evening. Sometime between eight and nine o'clock, Bolden, a colored man about forty-four years old, called at the Rogers home to get a suitcase. He asked for a drink and Glenn told him to help himself. He did so. There was considerable drinking, bragging, and some quarreling. They discussed horse racing, baseball, and prize fights. Bolden said he had whipped Kenneth Brown and his whole family. He said he was the best man in the house and no one challenged his statement. He and Glenn had an argument and he told Glenn how tough he (Bolden) was and threatened to stick his knife into him. Shortly after nine o'clock Glenn proposed to Albert that they go home. Albert at once arose and went out the door and Glenn followed him and they started across the yard to the Wilson car parked about thirty-five feet from the house. Bolden followed Glenn outside the house and the argument was continued. Albert did not know that Bolden had followed Glenn out but when he reached the car he heard a commotion behind him and saw Glenn and Bolden wrestling on the ground. He went back and helped to separate them and saw them get on their feet. Rogers, Ballinger, McFarland, and Clarence Wilson remained in the house *Page 432
after Glenn and Albert and Bolden left. Rogers heard noises and talking outside, and said to Clarence, "Let's go out and see what is the matter." They went outside and saw Glenn, Bolden, and Albert on the ground near a flower bed about seventeen feet from the house. Rogers said they were doing nothing but hugging each other and Clarence tapped Albert on the shoulder and asked him what they were doing and to get up. They got up and Albert put his hand on Bolden's shoulder and they walked southeast a way and turned west toward the rear of the car, which was headed north. They went behind the car and out of sight of Rogers. Rogers did not see Glenn during this time. Rogers and Clarence then walked to the front of the car and to the west side of it near the coal house. Rogers did not see Bolden and Al but he could hear them talking. He could not understand all they said but he remembered the exact words of Bolden, who said: "Well, if this is the way, I will turn some of your guts out." Rogers did not see Bolden or Al or Glenn at this time. But shortly after he heard the remark of Bolden, Rogers saw Glenn as he pushed between Rogers and Clarence, who is crippled, knocking Clarence down as he stood up against the coal house about three feet away. As a part of its case in chief, the State read into the record Albert's testimony in the Glenn Wilson case. It, also, shows that after Glenn and Bolden arose from their scuffle Albert and Bolden walked over back of the car and Bolden picked up a club and said he was going to knock the head off of somebody and Albert ran away. Soon after, he heard Clarence calling that he needed help. He came back and saw Bolden lying on the ground and Glenn was leaning against the east side of the car holding his right arm with his left hand. He and McFarland and Rogers carried Bolden into the house. Rogers testified that when Glenn pushed in between him and Clarence, knocking the latter down, he had a club in his hand and when he raised it to strike, Rogers ducked out of the way and went to the southeast corner of the house. Just before Glenn's appearance with the club he and Bolden had been out of sight behind the car. As Rogers retreated he heard a sound like a blow but did not see or know what was struck. He went back and saw Glenn, Clarence, and Albert standing, and Bolden lying face up on the ground. He then went to the house *Page 433
to call McFarland. Albert then helped Glenn into the car and they drove to a lunchroom about three blocks away and Albert put in a call for the police and an ambulance and he and Glenn then returned to the Rogers home. The telephone call is confirmed by the proprietor of the lunchroom and by the police night clerk. The peace officers arrived shortly and Nevins testified that he heard Glenn tell Mapes, deputy sheriff, that Bolden hit him with a club and he took the club away from Bolden and hit him with it. Nevins then searched the backyard and found a bloody spot on the ground where Bolden had been lying, and near by a pocketknife which Mrs. Bolden identified as belonging to her husband. Near by he found a club, rather round, with a flat side. These articles and the spot of blood (six by eight inches) were near the coal shed. The club was broken into two pieces. The jagged ends matched. There was some blood on the short piece, Exhibit B, about eight inches from one end. Nevins examined the body and saw a wound just back of the crown of the head. Heslinga, another officer, also saw "a wound" on the head. Van Genderen, the sheriff, testified that Glenn told him that night that Exhibit B must have been the club he hit Bolden with. He said there was a "big gash or cut on the back of Bolden's head." He was present when Nevins picked up the knife and club near the bloody spot. On the "flat edge" of the club was a blood spot with hairs clinging to the club. These were hairs from Bolden's head. Dr. Catterson, the coroner, examined the body at the Rogers home and at the funeral parlors. He said the scalp wound was about three inches long, and that the blow caused death instantaneously. He examined the body completely and found no marks of any significance other than the scalp wound. At the sheriff's office the next morning after the homicide a written statement, Exhibit E, was signed and sworn to by Glenn. Albert was not present. The State introduced it in evidence, over objection. It contains this statement, among others heretofore noted:
"Bolden picked up a stick and hit me on the right shoulder and forearm and back of the right ear. I took the stick away from him and held it in one hand, my left hand, I am naturally left handed, and I struck him on the head with this stick. After *Page 434
I struck Bolden he dropped to the ground and from the fact of being struck on the head I don't remember what happened after that, but I do know that I only struck him once."
All of the evidence noted above was put into the record by the State in its case in chief. Van Genderen, a State's witness, testifying for the defense, stated that he had examined Glenn rather casually, at the jail on June 16th, and found his right forearm bruised and with some abrasions. He did not observe particularly the upper arm. He saw a swelling back of his ear and extending to the hairline. He said "it would be hard to describe how big it was but it was a noticeable swelling."
In the opening statement to the jury the defense stated:
"In this case the defense will show that the defendant, Al Wilson, is not guilty as charged. The defense will show, if you please, ladies and gentlemen of the jury, that the negro involved in this case was a man who was unusually race conscious. And as we proceed with our evidence in this case we will show he was a man of violent temper and dangerous. That over a great many years he was always ready to assume insult of the negro race where no insult was intended. We will show you acts of violence on his part and we will show you the facts and circumstances of incidents of the night or evening of June 15, 1942."
Immediately after the testimony of Van Genderen, noted just above, the defense called Oscar Raines, a qualified witness on the matter, and asked him the general-reputation question referred to in assigned error one. The State objected "as being wholly incompetent and immaterial, and further assuming a set of facts not shown in this record, the question is also improper as to form." The judge then called the attorneys into his chambers and inquired of the assistant attorney for the State the theory of his objection. He replied:
"The theory of the State that any evidence with reference to the general reputation of Harry Bolden in the community in which he lived on or prior to June 15, 1942, is incompetent and immaterial in the trial of this case, it not being shown at this time or yet claimed that the defendant, Albert Wilson, was acting in what he did, if anything, in defense of himself or of his *Page 435
brother, Glenn Wilson, so that at this time the evidence is not competent for any purpose whatsoever and would be prejudicial to the rights of the State if the same was admitted at this time and had to be stricken later from the record because of the possible failure to connect up the same in the later evidence of the defendant. Court: Is that all? Mr. Spencer: Yes sir. Court: Now, Mr. Talbott, have you any statement to make in the record for the benefit of the Court and the record as to what your theory is in offering this testimony at this time? * * * Mr. Talbott: The defendant is offering this evidence on the theory that there was no crime committed at the time and place alleged in the indictment and it is material upon the question as to whether there was a crime committed. Court: I ask you, Mr. Talbott, at this time whether you expect to connect this evidence up later by showing that what, if anything, this defendant did, was done in defense of either his brother or himself? * * * Mr. Talbott: We will say this, that we do not at this time propose or say to counsel for the State or the Court that this evidence will be connected up with any conduct upon the part of the defendant, Albert Wilson, but we think it is admissible upon the record as it now is. Court: Now, gentlemen, it is the Court's opinion that the competency of this testimony is to be ruled upon by the Court in the light of the statement of counsel now made in the record as to whether or not it is going to be connected up later by evidence to the effect or tending to show that this defendant either acted in defense of himself or either of his brothers. The Court takes the view and so advises counsel that this defendant is on trial as a principal and is indicted as a principal and that it is incompetent for him to show that a co-defendant not now on trial was acting in self-defense unless he goes further and states that he was coming to the assistance of his brother or brothers. However, the Court wishes counsel to understand that this testimony would be competent in the Court's judgment and would be admitted by the Court if the Court were advised that the defendant was taking the position that he was acting in either defense of himself or in the defense of either of his brothers, or both of them, but that it is not defensive matter, nor competent evidence, if offered for the purpose of showing that the brother, Glenn Wilson, a co-defendant, was *Page 436
acting in justifiable self-defense and therefore he could not be guilty of aiding him or abetting him in the commission of a crime, if a crime was committed. In other words the Court feels that this defendant is now on trial as a principal and that the guilt or innocence of another defendant, a co-defendant not now on trial, is not conclusive on the question of the guilt or innocence of this defendant. Therefore the Court sustains the objection to the question asked of the witness, Oscar Raines. [Defendant excepts.]"
The appellant offered proof that Bolden's general reputation for the trait inquired about in the community where he lived at the time in question was bad. The State objected about as before.
Back in the courtroom the defense put on two other such reputation witnesses. The court stated:
"The State objects for the reason that it is incompetent and immaterial for the reason that it does not appear of record at this time that the defendant, Albert Wilson, was acting either in defense of himself, or in defense of either of his brothers, or both of them, nor that he personally knew of such reputation of the deceased, Harry Bolden, if the said Harry Bolden had such a reputation and therefore it is not competent for any purpose and for the further reason that the question assumes a set of facts not shown to exist in the record as to whether or not the deceased, Harry Bolden, had a general reputation in the community in which he lived prior to the time of his death with reference to being a quarrelsome man or otherwise. [Objection sustained and the defendant excepts.]"
To the offer of proof on one of the witnesses, the court stated:
"The objection to the offer is sustained, and as the Courtindicated in the Court's judgment it is prematurely offered."
The italicized words clearly show that the prematurity of the offer was because no evidence of Albert's participation in any defense of himself or Glenn had yet been shown, and not with the thought that the showing of aggression on the part of Bolden was insufficient. Neither did any objection of the appellee *Page 437
state the latter thought. The offer was not prematurely made for any reason.
The defense then introduced the testimony of Dr. Day, who examined Glenn on July 16th, the day following the homicide. Refreshing his memory from his history sheet, he testified:
"Upon physical examination, I found a large bruise between the wrist and the elbow joints on the right forearm, with some abrasion of the skin, a moderately large bruise and swelling on the right forearm, between the elbow and shoulder joints, and a large bruise, a swelling about the size of a hen's egg behind the right ear, with some abrasement of the skin, and a bruise and abrasion on the angle of the left jaw."
He said abrasion meant a slight bleeding. There was small blood on the arm bruises. The undertaker who bathed and prepared the body for burial, when asked to describe to the jury the wounds or bruises or marks that appeared on the body, said: "Well, the only mark was an incision right on the back of the head." He noticed no other wounds and bruises on the body. The State did not cross-examine.
The State put on the stand the five children and Golda Morgan, on whom it relied for a conviction. They were its key witnesses in the three trials that have been presented to us. The appellee states to us:
"The State expects the Court to determine this case solely upon the evidence as shown by the record herein and not upon any purported evidence or facts as stated in the other two Wilson cases."
Without deciding whether and to what extent this court may take notice of matters in our records of appeals in cases growing out of the same transaction, we may assure the State that its injunction has been strictly followed and our decision is based solely on the record herein. It was not necessary to go beyond it. But the State has also said that it denies that the evidence in the three cases is the same. We do not take issue with this statement but we may comment thereon. The witnesses have been the same, with unimportant exceptions, in the three cases. There should be no wide variation in their evidence, *Page 438
except as may be for lapses of memory in minor details. The court is familiar with the records and the evidence in the three cases and the writer has read the transcripts of the reporters in them. In the Glenn Wilson opinion the court said, 234 Iowa 96,11 N.W.2d 755:
"The evidence upon which the State relies to sustain the verdict and judgment is the testimony of the Stewart sisters, Charlotte Phipps, and Golda Morgan. We have already stated that their testimony respecting the beating which they say Bolden received is incredible because of its inconsistencies and its complete refutation by the physical facts as shown by the single wound on the body of Bolden."
The chief difference in the evidential records of the three cases is in the modification of the testimony of the Stewart girls and the Phipps girl, and that modification in one particular is that their testimony clashes far less with the undisputed physical fact — the single cut on Bolden's head and no other injuries — in this case than in Glenn's case. Those witnesses in that case had Glenn making a veritable chopping block out of Bolden. Juanita Stewart, who admitted in both cases that she did not tell the truth to appellant's attorneys when they were investigating the case preparatory to trial, testified that her attention was first attracted by seeing about six men, four white and two colored, come out of Rogers' house, and one white man and a colored man began wrestling on the ground; that Mr. Padgett then called his children and she and all of the children went to the Padgett home about half a block away, with the two men still on the ground. It took two or three minutes to walk up there and they sat on the porch for several minutes and after hearing three blows struck she went back to the Rogers place. She said she was gone five or ten minutes or more. She testified that she saw the white man striking Bolden about twenty times, "awful hard on the head." She testified that after she came back, Golda Morgan came out close to where she was and stayed about half an hour, and "this fighting was going on all of that time."
On this trial she had no memory of how long the beating continued, whether it was ten minutes or a half minute. She had no recollection of how many blows were struck. She did say *Page 439
that Bolden was lying without moving, with his face up. Yet there was no mark upon the face, the chest, limbs, or body of Bolden when the beating ceased. She questioned the accuracy of the transcript of her testimony in Glenn's case. Her examination, covering fifty-six pages of the transcript, does not enhance her veracity or add to the credibility of her testimony in either case.
Charlotte Phipps, in Glenn's case, testified that a negro was on the ground and:
"The man I saw using the club was hitting the man many times. He hit him with the club and kept on hitting, just like he was chopping wood or something. He was already doing it when I got there. He was still at it when I left. I stayed there for several minutes."
She saw no other man near the man on the ground except the one who was beating him. At the trial in this case she merely testified that she saw a man hitting a man on the ground with a club. She saw nobody holding the man who was beaten, contrary to the contention of the State and the testimony of some of the girls. She did not see Juanita Stewart there at any time. Juanita admitted she had told attorneys for the defense, when they were investigating, that she did not return to the Rogers place after she went to the Padgett home, which was before any blow was struck with a club.
But there is testimony at this trial that Bolden was severely beaten — so much beaten that the testimony cannot reasonably be reconciled with the physical facts. Lillian Stewart testified that the white man beat the colored man on his head for about five minutes with a club like a ball bat as he lay face upward on the ground and two white men on their knees held him. Lillian did not see Golda Morgan either in her own yard or in the street. Golda was an adult woman who kept house for Mr. Dowd, who lived across the street just south of the Rogers house. She testified that she stood a short distance west of the northwest corner of her kitchen about opposite the Rogers coal house, and saw two white men standing up holding a colored man, who also was standing up, while a white man stood by swinging a club over his shoulder, holding the club with both hands, striking the negro, *Page 440
blow after blow, for seven or eight minutes. All of the blows were on the left arm and shoulder and none was on the head. These men never moved their position but stayed behind the car. The negro tried to get loose but he could not. The beating continued all of the time she watched them. They were still fighting when she left to sit on the porch on the south side of the house. The negro and all of the white men were on their feet when she last saw them as she left.
There was more evidence tending to show self-defense on the part of Glenn than in the case against Clarence, and much less evidence of beating Bolden in the latter case. Our opinion in that case [State v. Clarence Wilson, 235 Iowa 538,17 N.W.2d 143] states that the witnesses "did not say that more than one blow was struck."
We have fairly set out the evidential record with the objections and rulings respecting this error. The court's rulings were clearly erroneous and distinctly prejudicial. In the light of that record there is no basis for the repeated statements in the argument of the State that, considering the State's evidence as a whole, there is not a scintilla of evidence even suggesting that Glenn Wilson might possibly have acted in self-defense, or that Bolden was ever armed with a club. It is a well-settled principle that, under certain recognized conditions and circumstances, one may defend himself against death or great bodily harm. And if a homicide results, the one criminally charged therewith may support that defense by evidence of all the circumstances of the transaction, including any threats of deceased, acts of aggression, hostile demonstration, or overt attack, sufficient to arouse a reasonable belief in the accused of apparent imminent danger to his life or of great bodily harm to him. The character or reputation of the deceased for being a violent, quarrelsome person may well have added to the apprehension of the accused. As Wigmore has said:
"When the issue of self-defense is made in a trial for homicide, and thus a controversy arises whether the deceased wasthe aggressor, one's persuasion will be more or less affected by the character of the deceased; it may throw much light on the *Page 441
probabilities of the deceased's action." Wigmore on Evidence, Third Ed., section 63.
Before evidence of this character or trait is admissible there must have been some preliminary foundation laid, some evidence already introduced of hostile demonstration, or some overt act of aggression or violence on the part of the deceased directed toward defendant. Or, as Wigmore, in the same section supra, said:
"There ought, of course, to be some other appreciable evidence of the deceased's aggression, for the character-evidence can hardly be of value unless there is otherwise a fair possibility of doubt on the point * * *."
This preliminary evidence need not establish the hostility or aggression. It is necessary only that it tend to establish it, that there may be some doubt about the matter, in order to permit the introduction of character or reputation evidence. This matter was ably discussed by Justice Parsons, in State v. Rhone,223 Iowa 1221, 1230, 275 N.W. 109, 114, in which there was a reversal for rejecting character testimony. The court quotes at length with approval from the annotation to State v. Thompson, 49 Or. 46,88 P. 53, in 124 Am. St. Rep. 1015 et seq., loc. cit. 1230. After stating some evidence bearing on the question, the court states that these matters "are set out here to show what one can about the parties to such an affray; that the door is open to show everything that bears upon the subject, and that it is right that this should be done, if there is a conflict of evidence."
Quoting from page 1028 of 124 Am. St. Rep., this court states, on page 1232 of 223 Iowa, page 115 of 275 N.W.:
"And the note sums up by saying: `From these two cases may be deduced a general rule to the effect that if there is the slightest evidence reasonably tending to show that the killing was in self-defense, evidence of the violent and dangerous character of the deceased should be admitted.'"
See, also, 26 Am. Jur., Homicide, sections 338-345; State v. Yates, 132 Iowa 475, 479, 109 N.W. 1005; annotation 64 A.L.R. 1029 et seq.; 40 C.J.S., Homicide, section 272; State *Page 442
v. Buford, 158 Iowa 173, 174, 175, 139 N.W. 464; State v. Brooks,192 Iowa 1107, 1117, 186 N.W. 46; State v. Beird, 118 Iowa 474
-482, 92 N.W. 694; State v. Kelly, 196 Iowa 897, 902,195 N.W. 614; State v. Clarence Wilson, supra, 235 Iowa 538, 544,17 N.W.2d 138, 142.
The preliminary showing in this case far exceeded the minimum required by the above-cited authorities. It was much more conclusive than having a mere "bearing" on the question, as required in State v. Kelly, supra. As noted in State v. Beird, supra, 118 Iowa 474, 482, 92 N.W. 694, 697:
"That there was some evidence tending to show the deceased to have been the aggressor in the encounter with defendant is left without doubt in the record."
It is immaterial whether the foundation was laid in the evidence of the State or in that of the appellant. State v. Porter, 34 Iowa 131, 140; State v. Yates, supra, 132 Iowa 475,479, 109 N.W. 1005.
The evidence shows Bolden's quarrelsome disposition in the Rogers house, his confidence and pride in his physical prowess, his bragging of whipping a family, his challenge that he was the best man in the house, his quarrel with Glenn, his threat to stick a knife in him, his pursuit of Glenn when he peaceably left the house to go home, his following Glenn to the car after being separated in the encounter on the ground, his threat to knock somebody's head off, his threat to disembowel someone, his picking up of the club, the striking of Glenn with the club, the corroborating bruises on Glenn's body, the backing up of Glenn when he ran into Clarence knocking him down; Glenn's statement that he struck Bolden but once with the club which he had taken from Bolden, corroborated by the single cut, gash, or incision on Bolden's head, Bolden's knife lying on the ground near his body after the affray. All this evidence tends to sustain the appellant's contention that Bolden was the aggressor and that Glenn struck in self-defense, and that the reputation testimony should have been admitted.
The defense of self-defense was made in the opening statement of appellant to the jury in the contention that Bolden was a quarrelsome, violent man. It was made known to the court *Page 443
and the prosecution in the judge's chambers when appellant's attorney stated that the reputation testimony was offered and was admissible because no crime had been committed. Glenn's having admitted the homicide, the statement that no crime was committed meant but one thing, and that was that the killing was justifiable, was in self-defense. The State then knew that about sixty days previously Glenn had asserted and introduced evidence of self-defense in his own trial. But whether expressly asserted or not, the evidence itself showed that self-defense was an issue, and that the appellant was entitled to corroborate testimony of hostile acts of aggression by showing that deceased's reputation and character were such as to show the probability of their occurrence.
[2] The State objected to the testimony of Bolden's bad reputation because it claimed it was not shown that Glenn knew about it. This may be true as related to Glenn's apprehension, but it is immaterial as bearing upon the fact as to which was the aggressor, and as tending to corroborate other testimony relative to the assault. On that issue it is not different from the rule as to uncommunicated threats. It is the fact of the deceased's character and reputation as to this trait, and not the accused's knowledge of it, that is important and material. As Wigmore said:
"* * * this additional element of communication is unnecessary; for the question is what deceased probably did, not what the defendant probably thought the deceased was going to do The inquiry is one of objective occurrence, not of subjective belief." Wigmore on Evidence, Third Ed., section 63.
However, Glenn's experiences with Bolden in the Rogers home, and what Bolden said and did there, gave him some knowledge of Bolden's aggressive disposition. See, also, Cain v. Skillin,219 Ala. 228, 121 So. 521, 64 A.L.R. 1022 et seq., and annotation; State v. Beird, supra, 118 Iowa 474-482, 92 N.W. 694.
The admission of this testimony was especially important to the appellant, and for that reason its rejection was especially prejudicial to him. For if the homicide was justifiable because Glenn struck in self-defense, no crime was committed, and Glenn was guilty of none. Necessarily, the appellant, who, the State *Page 444
charges aided and abetted Glenn, could be guilty of no crime in so doing. There is no question in law or logic on this point. See State v. Clarence Wilson, supra, 235 Iowa 538, 544,17 N.W.2d 138, 142, and authorities cited; State v. Phillips Ross,24 Mo. 475; Pizana v. State, 81 Tex.Crim. Rep., 193 S.W. 671; 29 C.J., Homicide, section 44; 40 C.J.S., Homicide, section 9; Harper v. State, 83 Miss. 402, 35 So. 572; Davis v. State, 107 Tex. Crim. 315,296 S.W. 895, 896.
In State v. Leeper, 199 Iowa 432, 442, 443, 200 N.W. 732, 736, the defendant was tried for aiding and abetting Mrs. Wertz to commit the murder. In reversing a judgment of conviction, the court said:
"She testified that she fired the fatal shot. The court correctly instructed, in substance, that, if the jury found that Mrs. Wertz killed the deceased, it must be further establishedbeyond a reasonable doubt that she did not do so in justifiableself-defense, before the appellant could be convicted as an aiderand abettor." (Italics ours.)
If there should be a retrial of this case, and the jury should find that Glenn Wilson killed the deceased in self-defense, it would be the duty of the jury to acquit this appellant.
II. The fact that, subsequent to the trial of appellant, Glenn was acquitted of the killing of Bolden on his defense of self-defense has been called to the attention of the court on this appeal and has been commented on by both sides. Appellant states that because thereof this appellant has been adjudicated not guilty and that the State should make application for a reversal of the judgment against appellant. The contention of appellant as to the adjudication has been urged by others and there is an interesting discussion of that view in the dissenting opinion in Roberts v. People, 103 Colo. 250, 87 P.2d 251,258-260, but the law is to the contrary, as held by this court in State v. Clarence Wilson, supra, 235 Iowa 538, 541,17 N.W.2d 138, 140, 141. Many authorities support the rule that, where a principal in the first degree and a principal in the second degree in the same offense have separate trials, the judgment against one, whether of conviction or of acquittal, has no bearing upon a judgment against the other. See authorities cited in State *Page 445
v. Clarence Wilson, supra; also, People v. Frye, 248 Mich. 678,227 N.W. 748; State v. Gifford, 19 Wash. 464, 53 P. 709; Maughon v. State, 9 Ga. App. 559, 71 S.E. 922, 924; Reed v. Commonwealth,125 Ky. 126, 100 S.W. 856, 30 Ky. L. Rep. 1212; State v. Martino,27 N.M. 1, 192 P. 507, 508, 509; Rooney v. United States, 9 Cir., Or., 203 F. 928. The judgment acquitting Glenn is neither res judicata in bar of the prosecution of Albert nor is it an estoppel to relitigating the issue of Glenn's self-defense. Kunkel v. Eastern Iowa Power L. Co., 232 Iowa 649, 656 et seq.,5 N.W.2d 899.
However, the doctrine of res judicata springs out of and is founded upon the principles of estoppel. It rests upon the principle of public policy that there should be an end to litigation of a question to which a public tribunal has once furnished an answer. The ancient maxim is, "Interest reipublicae ut sit finis litium."
Because of our holding on the first assigned error there is no necessity of ruling on the second one.
The judgment is reversed. — Reversed.
HALE, C.J., and GARFIELD, OLIVER, MULRONEY, and WENNERSTRUM, JJ., concur.
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50 6th Judicial District Court
Albert M. McCaig, Jr., Judge
www .Court506.com Court Coordinator
Susie Schubert
Court Reporter
Robyn S. Wiley
Grimes County
Waller County
May 5, 2015 836 Austin Street, Suite 307
MAY 07 2015 Hempstead, Texas 77445
, Fax: 979.826.9149
ore: 979.921.0921
Court of Criminal Appeals
P.O. Box 12308
Capitol Station
Austin, Texas 78711
Re: Writs Number 08-09-12976D through 08-09-12986D
Criminal Trial Court Number 08-09-12976
Ex Parte
William Andrew Allen
Clerk:
I am the trial court judge in the referenced matter. The cases were originally heard by
the 155 1h Judicial District Court. By Legislative act (Section 24.254, Government Code),
effective January 1, 2014, the 506th Judicial District Court took over all cases pending in the
155th Judicial District Court.
The Applicant, Mr. William Andrew Allen, has made numerous filings with the trial
court pertaining to his 11.07 Writ applications, many of which have had to do with his
contention that the 5061h court does not have jurisdiction of his cases. I have personally
written to inform Mr. Allen of the effect of the change of courts. ·
Mr. Allen's frequent and continuous supplementation and filings has required both
this court and the Waller County District Clerk, to provide eleven separate supplements to
the several 11.07 Applications each time Mr. Allen files new allegations. This has become
labor and resource intensive, consumes valuable time, and, to date, does not appear to have
provided any substantial new information to your court. ·
I am requesting the Honorable Texas Court of Criminal Appeals to declare Mr.
William Andrew Allen a vexatious litigant, and to deny him further access to the courts until
his current applications for 11.07 relief have been ruled on by your court.
~!(~cC
Judge, Presiding
AMMI
c: Waller County District Clerk
Mr. William Andrew Allen
Mr. Elton Mathis, Waller County District Attorney
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The indictment in terms charges the appellant with the crime of rape, and alleges that the act was committed upon the prosecutrix, who "was then and there a female idiot or a female naturally of such imbecility of mind or weakness of body as to prevent effectual resistance." The appellant moved for a directed *Page 624
verdict, and among other grounds urged that the evidence "affirmatively showed that the prosecutrix is not an imbecile within the meaning of the statute under which this indictment is found." The motion was made at the close of all the testimony and was overruled by the court.
The State makes no claim that the prosecuting witness is an idiot, and no attack is made upon the indictment. The State's contention is that the prosecutrix comes within the provisions of the statute (Code, Section 12967) which provides for punishment of any person who has unlawful carnal knowledge of any female "naturally of such imbecility of mind or weakness of body as to prevent effectual resistance."
Each member of the court has carefully read the entire record on this subject, and a majority are of the opinion that a jury question was presented on the question of the imbecility of the prosecutrix. The minority of the court, which includes the writer, are of the opinion that the motion for a directed verdict should have been sustained upon the ground of the insufficiency of the evidence to show beyond a reasonable doubt the imbecility of the prosecutrix.
In this situation, and in view of a reversal and possible retrial, we deem it unnecessary to review the evidence in this opinion or make further comment thereon.
II. The appellant contends that the trial court erred in submitting to the jury the included offense of assault with intent to commit rape. Broadly speaking, it is the appellant's contention that there is no such crime named in the statute as rape.
This is true. We recently had before us the question of so-called "common-law rape" and "statutory rape," and fully discussed the provisions of the statute, Code Section 12966. State v. Hoaglin, 207 Iowa 744. Code Section 12966 is the section that provides for the punishment of what is known as "common-law rape," and also so-called "statutory rape." The statute under which the charge involved in this action is brought is, however, a separate section. It is Section 12967, and provides for the punishment of any person who has unlawful carnal knowledge of a female by administering to her any substance, or by any other means procuring such stupor or such imbecility of mind or weakness of body as to prevent effectual resistance, or has such carnal knowledge of an idiot or female naturally of such imbecility of mind or weakness of body as to prevent effectual resistance. *Page 625
Since the organization of the state we have never had a statute which in terms has designated a crime of this character by the word "rape." The Code of 1851 (Section 2581), like the present Code, provided for the punishment of any person who shall ravish and carnally know any female by force and against her will. Various changes were made in the statute from time to time. The Revision of 1860 contained a new section providing punishment for anyone having unlawful carnal knowledge of a female by administering to her any substance procuring stupor or imbecility of mind, and the Code of 1873 amended the latter statute by adding to said section the provision for the punishment for carnal knowledge of an idiot or female naturally of such imbecility of mind or weakness of body as to prevent effectual resistance. None of the statutes used the word "rape." Section 12968 (Code, 1931) provides for the punishment of any person who shall "assault a female with intent to commit a rape." The contention of the appellant is that the statutory offense of having carnal knowledge of a female naturally of such imbecility of mind or weakness of body as to prevent effectual resistance is not rape, and therefore the appellant could not be guilty under Section 12968 of assault with intent to commit rape.
We discussed the question fully in the Hoaglin case with respect to assault with intent to commit so-called "statutory rape," which is included in the provisions of Section 12966. The offense charged in this indictment under Section 12967 is as much so-called "statutory rape" as the offense of "statutory rape" described in Section 12966, where the age of the parties is the essential element.
Following the rule of the Hoaglin case, we hold that the offense of assault with intent to commit a rape, under Section 12968 of the Code, was an included offense in the crime charged in the instant case under Section 12967, to wit, that of unlawful carnal knowledge of an imbecile, and that therefore the court did not err in submitting to the jury the included offense of assault with intent to commit a rape.
III. The appellant contends that the court erred in not submitting to the jury as included offenses assault and battery and simple assault.
We had this question before us in the Hoaglin case, where it was discussed at length. We therein said:
"An indictment charging rape (statutory or otherwise) charges *Page 626
the included offenses of assault with intent to commit rape, simple assault, and also assault and battery."
Again in said opinion we said:
"When an indictment or county attorney's information charges a defendant with the crime of rape (statutory or otherwise), it also charges him with the included offenses, to wit: assault with intent to commit rape, assault and battery, and simple assault. Whether or not the court should submit any one or more of these included offenses depends wholly upon the evidence."
Following the rule so recently announced, it must be held that the indictment in the instant case charges the appellant with the crime of statutory rape, and it therefore follows that it also charges him with the included offenses of assault with intent to commit rape, assault and battery, and simple assault. In the Hoaglin case we held that whether or not the court should submit any one or more of these included offenses "depends wholly upon the evidence." The court did submit the crime of assault with intent to commit rape. It did not submit the crimes of assault and battery and simple assault. Under the evidence, the court erred in failing to submit the crimes of assault and battery and simple assault. The evidence in behalf of the State had a tendency to show, and the jury might have found, that the appellant unlawfully laid hands upon the prosecuting witness, came in contact with her body, forcibly removed portions of her clothing, and completed the act of intercourse. Under the record the evidence was such that the jury might have found the appellant guilty of assault and battery or simple assault. It therefore follows that inasmuch as these offenses are included within the offense charged, to wit, that of so-called statutory rape, and there being evidence in the record from which the jury might have found that the appellant was guilty of assault and battery and simple assault, the court erred in not submitting to the jury these included offenses.
For the reasons pointed out in this opinion, the judgment of the district court must be, and it is, — Reversed.
All justices concur in result.
STEVENS, C.J., and ALBERT, WAGNER, and FAVILLE, JJ., dissent as to Division I. *Page 627
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I. On the afternoon of March 26, 1926, E.L. Miller and Guy Bean, special investigators of the bureau of investigation, connected with the office of the attorney-general, purchased a quart of intoxicating liquor of one Henry 1. INTOXICATING Smoger, in the public highway not far from his LIQUORS: residence, in Jasper County, and later, on the bootlegging: same day, obtained a gallon of liquor, conflicting containing, according to the testimony of the evidence. State, 50 per cent alcohol by volume and 42.5
per cent by weight, from the said Smoger, or from William Weber, the appellant. They paid Smoger $3.00 for the quart purchased in the highway. Miller and Bean testified *Page 139
that they went in an automobile with Smoger to the farm home of appellant, and that Smoger told appellant that he wanted a gallon of oil; that the three men then went to Smoger's place, where they consumed a part of the quart of liquor; and that, within a few minutes thereafter, appellant drove up in a Haynes touring car, bringing with him a gallon jug of liquor, which he delivered to Miller, who paid him $3.00, $6.00 having previously been paid to Smoger.
Appellant, Smoger, and an employee of the latter's contradicted the testimony of the special agents as to the transaction and delivery of the liquor to them by appellant, Smoger claiming that he had the liquor stored in his granary, and that he sold and delivered it to Miller. Substantially in all other respects, the testimony of the witnesses agrees.
One of the propositions urged by appellant for reversal is that the evidence was insufficient to sustain the verdict. This contention is based largely upon the alleged good character of appellant and the alleged bad character and habits of the special agents. The witnesses agreed in their testimony that they all drank out of the bottle containing the quart of liquor purchased in the highway, but they disagree as to the quantity consumed by appellant and as to whether Miller was intoxicated or not. The witnesses for the defendant testified that he was. Miller received $15 for each prosecution for the violation of the prohibitory liquor laws in which he secured the evidence, and Bean was paid $5.00 per day for similar services.
Appellant resides upon, and operates, a farm of 200 acres, and six of his neighbors testified that he had a good reputation for moral character and law observance. Two witnesses, one the marshal of Laurel, a near-by town, and the other 2. WITNESSES: a deputy sheriff of Marshall County, testified impeachment: that his reputation for moral character was bad. qualifica- These witnesses resided six or seven miles from tion of the residence of appellant, and their competency witness. as witnesses is challenged on the ground that they did not reside in the vicinity and could not be familiar with the general reputation of appellant. On this point, we need only say that they testified that they knew his general reputation in the community in which he resided, and had long been familiar therewith. It was not essential to their competency as witnesses that they reside *Page 140
in the immediate vicinity of the appellant. It was sufficient if they were in a position to know, and knew, his general reputation in the particulars mentioned. The weight of their testimony was for the jury. The evidence is in such sharp conflict as to the part appellant took in the transaction that the court could not hold that the verdict was either contrary to it or not sustained thereby. Smoger is a confessed bootlegger, and the explanation given by appellant of his part in the transaction, in view of the visit and the conversation about the oil between him and Smoger before he went to the residence of the latter, is not particularly persuasive or convincing. Whatever may be thought of the character and business of the special agents, Miller and Bean, the substantial disagreement between their testimony and that of appellant's witnesses is in regard to the transportation and sale of the jug of liquor; otherwise, the disagreement is upon minor details. We are not inclined to interfere with the verdict.
II. The presiding judge interrogated the witness Bean as to the alleged transaction with appellant. The interrogatories propounded by the court elicited nothing new, and were for the purpose, as stated at the time, in response to 3. WITNESSES: the objections of counsel, of more clearly examination informing the court as to the facts of the by court. transaction. The examination was conducted with due propriety, and we perceive no theory upon which there was error or misconduct on the part of the court. None of the cases cited by appellant sustain his contention to the contrary. They hold merely that the trial court should not, as a rule, interfere with the examination of witnesses when the examination is being fairly conducted, and that questions should not be asked in a manner or under circumstances to indicate to the jury that the court is suspicious of the veracity of the witnesses, or so as to indicate a leaning or bias in favor of one side or the otherState v. Spiers, 103 Iowa 711; State v. Allen, 100 Iowa 7;Bierkamp v. Beuthien, 173 Iowa 436. The examination was wholly proper, and could not have been more prejudicial to appellant than the repetition of testimony already detailed would ordinarily be.
III. Appellant requested the court to instruct the jury, in substance, that a sinister motive for a criminal prosecution *Page 141
may be shown by the defendant, and that, in considering the case and determining the weight, if any, to be given 4. TRIAL: to the testimony of the witnesses Miller and instruc- Bean, it would be proper for the jury to tions: consider any sinister motive which the evidence covering showed prompted these witnesses in bringing requested about the prosecution of appellant, and that, if instruction. either of them had such a sinister motive, and the prosecution was the result thereof, the jury would be warranted in disregarding their testimony. The requested instruction was refused, and the following given by the court:
"You are instructed that the witnesses Miller and Bean are detectives, and you may take into consideration said fact, as well as the amount of their compensation, and upon what their compensation depended, along with all other facts and circumstances as disclosed on the trial, in determining their credibility as witnesses."
The court further instructed the jury that, if they found that any witness had willfully sworn falsely to any material fact, they were at liberty to disregard the testimony of such witness, except in so far as the same was corroborated by other credible evidence in the case. Miller and Bean were not disqualified to testify as witnesses in the ease. The only effect of their interest therein, if any, was to tend to discredit their testimony. Under the instructions given, the jury was required to give consideration thereto in determining the credibility and weight of their testimony. The ultimate question to be determined by the jury was the guilt or innocence of the accused. The motive that inspires a criminal prosecution may, of course, tend to discredit the testimony, if offered upon the trial, of the person responsible for the prosecution, but it could have no greater effect. Appellant was permitted to interrogate the witnesses as to their interest in the prosecution and to go fully into the nature and character of their business and employment. We find nothing in State v. Shultz, 177 Iowa 321, in conflict with the course pursued by the trial court. The instructions given sufficiently covered the point raised by the requested instruction.
IV. The court refused to instruct the jury, as requested by appellant, as to the effect of contradictory statements made by a witness outside of the trial and in conflict with his *Page 142
testimony, as detailed to the jury. The instructions to which we have already referred sufficiently met all the purposes of the one requested. The testimony to which the requested instruction was directed was that of the witnesses Miller and Bean. It was claimed by appellant, and testimony was offered tending to show, that some of the statements made in the preliminary hearing before the justice of the peace by these witnesses were contrary to those given upon the trial. The evidence related to a mere matter of detail, and we think the instructions touching the credibility of the witnesses were sufficient on this point.
Appellant's requested instruction No. 5, which was refused by the court, might, perhaps, properly have been given by the court; but its substance was stated in several paragraphs of the charge, and no prejudice is shown.
V. The court in its instructions defined intoxicating liquor, and in part said:
"You are further instructed that any liquor which contains 50 per cent alcohol by volume and 42.5 per cent alcohol by weight, and which can be used as a beverage, is intoxicating liquor, within the meaning of the law."
The exception urged to this instruction is that it is not based upon any evidence in the case. A portion of the contents of the gallon jug was analyzed by a chemist, and found to contain alcohol, as stated in the instruction. The criticism is without merit.
VI. The court further instructed the jury that it was immaterial what the means adopted by the buyer of intoxicating liquor are, or the purpose or motive which prompted the purchase, if the sale was unlawful. The court further 5. INTOXICATING instructed the jury in this connection that the LIQUORS: material proposition to be determined was: Did unlawful the defendant, in this county and state, within sale: means the period of the statute of limitations, for and motive himself or any other person, carry around upon in effecting his person or in any vehicle intoxicating sale. liquor, with the intent to sell the same? The criticism of this instruction proceeds upon the theory that it, in effect, negatived the testimony with reference to the alleged sinister motive of Miller and Bean in the prosecution of appellant, and tended to withdraw the same from the consideration *Page 143
of the jury and to minimize the effect thereof. The instruction was clearly correct, was in no wise in conflict with any other paragraph of the court's charge, and did not refer to the credibility of the witnesses. The exception is without merit.
VII. The court gave the usual cautionary instruction as to the testimony of the defendant, who took the stand in his own behalf. We are urged to hold that this instruction is no longer a proper one, and that it should no longer be given in criminal cases. The instruction has stood the test of many decisions of this court, and we are not disposed to hold that it was error to give it.
Other questions substantially covered by what has already been said are argued by counsel. A strong plea is made for the appellant upon the basis of his alleged good character, as evidenced by the testimony of his neighbors, and that his conviction, substantially upon the testimony of Miller and Bean, should not be permitted to stand. It was the especial province of the jury to pass upon the fact issues of the case. With these the court has nothing to do. The defendant having been found guilty, the judgment can be reversed only upon error arising upon the trial.
The judgment of the court, which imposed a fine of $600 upon appellant and imprisonment for five months in the county jail, is urged as excessive, and we are asked to modify the same. The 6. INTOXICATING guilt of appellant having been found by the LIQUORS: jury, we are not disposed to hold that the bootlegging: punishment is excessive. Offenses of the excessive character here involved are deliberately judgment. committed, and with actual knowledge of the law.
We find no reversible error in the record, and the judgment is affirmed. — Affirmed.
EVANS, C.J., and FAVILLE, VERMILION, and KINDIG, JJ., concur. *Page 144
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I. Plaintiff brings this action, as trustee in bankruptcy of the estate of Lilly Cleland, a bankrupt, to have two instruments canceled and set aside, — one dated November 26, 1920, purporting to be a mortgage given by appellant 1. HOMESTEAD: alone to her father, James Fisher, upon the east abandonment: 74 acres of the east one half of the southwest execution of quarter of Section 31, Township 77, Range 15, to mortgage: secure an apparent indebtedness of $10,000; and effect. the other a deed, dated July 21, 1921, signed by appellant and her husband, and conveying the above described premises to the above named mortgagee, — upon the ground that the said instruments were executed without consideration, and in fraud of the creditors of appellant.
The court found, upon the issues joined, that the deed was, in fact, a mortgage, and that the instruments were executed in good faith, and not in fraud of creditors. As plaintiff has not appealed, these issues are not here involved.
Appellant, in her separate answer to the petition, alleged that she is the head of a family; that she is now occupying, and has for many years occupied, the south 40 of the above described tract as a homestead; and that same, under Section 10150, Code of 1924, is exempt to her from the claims of creditors. The response of appellee to this claim of appellant's is that, by the execution of the deed to James Fisher (which contained the following provision, "and grantors reserve only the privilege of occupying said premises until March 1, 1922"), and by leasing same from him, she abandoned the homestead, and is now estopped to claim the exemption thereof. The record does not disclose that any of the debts owed by her were contracted prior to the acquisition of the property in question. The court below found that the homestead had been abandoned by appellant, and decreed title thereto, subject to the incumbrances, in appellee, as trustee. *Page 58
Abandonment of the homestead is largely a matter of intention. Appellant continued to reside thereon, to pay the taxes, to keep the premises in repair, and to improve the same. No rent was ever paid by her, nor did her father assume any dominion or control whatever over the property. It is the settled rule in this state that a deed absolute in form, but executed as security for a debt, vests the legal title only in the grantee; and that a conveyance of the homestead by a deed absolute on its face, but intended only to secure a debt, does not destroy the homestead character of the premises. McClure v. Braniff, 75 Iowa 38;Haggerty v. Brower, 105 Iowa 395.
There is nothing in Jasper County v. Sparham, 125 Iowa 464, which is relied upon by appellee, in conflict with the rule declared by the above cases. The purpose of the reservation in the deed is not explained. It appears not to have been acted upon, and is of little significance in an instrument found by the court to be a mortgage. There is nothing in the record to indicate an intention upon the part of appellant to abandon her homestead right in the premises, except the matters above recited; and, in keeping with the universal rule that exemption laws must be liberally construed, we are compelled to hold against the finding of the court below on this point.
II. It is conceded of record that appellant was adjudged a bankrupt by the United States district court on April 18, 1923, in a voluntary bankruptcy proceeding. It is now contended by appellee that it was incumbent upon appellant to 2. BANKRUPTCY: plead and prove that she scheduled the land in exemptions: question as exempt to her as a homestead, in the waiver of bankruptcy proceedings; and that, upon her homestead failure to so plead, and to sustain the same by right: proof, this court should presume that she did burden of not do so; and that she thereby waived her right proof. to now claim the exemption.
The exemptions allowed in bankruptcy are those to which the bankrupt is entitled under state laws; and it is his duty to list the same as exempt, in the bankruptcy proceedings, at the time the petition is filed. In re Exum, (D.C.) 209 Fed. 716; In reStern, (D.C.) 208 Fed. 488; In re Gerber, 108 C.C.A. 511; Brandtv. Mayhew, 134 C.C.A. 210; White v. Stump, 266 U.S. 310 (69 L. Ed. 122). The title to exempt property does *Page 59
not, however, pass to the trustee, but remains a part of the estate of the bankrupt. Bank of Nez Perce v. Pindell, 113 C.C.A. 545 (193 Fed. 917); In re Cale, 111 C.C.A. 89 (191 Fed. 31);Lockwood v. Exchange Bank, 190 U.S. 294 (47 L. Ed. 1061).
The record is devoid of any pleading or proof relating to the bankruptcy proceedings, further than the allegation of the petition that appellee was appointed trustee therein, and the concession that appellant was declared a bankrupt, as stated. It seems to us that, as title to exempt property does not pass to the trustee in bankruptcy unless the exemption is waived by the bankrupt, the burden of showing waiver rests on the party seeking to claim some advantage on account thereof. As stated, the only exemptions recognized by the court in bankruptcy proceedings are such as exist under state laws. Appellant had a right, under the statutes of this state, to claim as a homestead the 40 acres upon which she resided, exempt from the claims of creditors; and this court will not presume that she waived such right in the bankruptcy proceedings. On the contrary, the court will, under such circumstances, give full force and effect to state statutes enacted for the benefit of the head of a family, including a liberal construction thereof. In our opinion, it was incumbent upon appellee, if he claimed title to the property, to plead and prove that appellant failed to make proper claim to the exemption in the bankruptcy proceedings.
It is our conclusion that the title to the tract occupied and claimed as a homestead is exempt to appellant; and the judgment and decree of the court below, so far as the same is adverse to appellant, should be and is reversed, and remanded to the court below for decree in harmony herewith, fully protecting the right of the homestead, both as to sale and the use thereof. It is so ordered. — Reversed and remanded.
FAVILLE, C.J., and De GRAFF and VERMILION, JJ., concur. *Page 60
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01-03-2023
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07-05-2016
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On February 1, 1918, Clark Brothers executed to Iowa Title
Loan Company a number of promissory notes ranging in amounts from $500 to $2,000 each, aggregating $10,000, and to secure them executed the mortgage in suit, containing the following provision:
"The lien of each note to be of equal grade and neither inferior to the other, no act of the holder of any one of said notes to change such relation and any foreclosure to be for the benefit of the holders of all the notes then outstanding and to provide for a pro rata distribution of the proceeds of sale thereunder, upon all unpaid notes, whether the holders thereof be parties to the suit or not."
The mortgaged premises were later sold to Dunkin, who assumed the mortgage debt and made an agreement with the Iowa Title
Loan Company for an extension, the effect of which was litigated in former actions which came to this Court under the titles Iowa Title Loan Company v. Clark Brothers, 209 Iowa 169 *Page 877
; Koontz v. Clark Brothers, 209 Iowa 62. The Iowa Title Loan Company retained for themselves notes to the amount of $1500, sold notes to Mrs. Koontz to the amount of $2500, to Mrs. Heffron to the amount of $4,000, and to C.J. Cash to the amount of $2,000. The latter have been transmitted to Mrs. Cash. The Iowa Title Loan Company retained possession of the notes for the purpose of collecting and distributing the interest, and was the trustee of Mrs. Heffron and Mrs. Cash for the purpose of suing on the notes sold to them and of foreclosing the mortgage and protecting their interests. Actions at law were brought by Iowa Title Loan Company and Mrs. Koontz on the notes owned by them respectively, and judgments recovered. (See cases above cited.) These judgments became a lien upon three city lots owned by the judgment debtors. Interveners, Alfred B. Clark, Dwight D. Clark, and J. Russell Clark became creditors of Clark Brothers to the amount of $12,153.71, for which amount Clark Brothers gave to interveners their note and conveyed to interveners the three lots, under agreement between Clark Brothers and interveners, which recited that there were judgments of record "which constituted a general lien upon the said lots, which judgments were secured" by the mortgage here in question, "which mortgage contains a provision for pro-rata distribution upon foreclosure upon all of the notes secured thereby, including the notes upon which the said judgments were obtained." The agreement between Clark Brothers and interveners further recited that if such pro-rata distribution did not pay off the judgments in full Clark Brothers still owed interveners the difference between the judgments and the pro-rata distribution. Iowa Title Loan Company held other claims against Clark Brothers, including claims secured by mortgage on other land. On August 27, 1930, Iowa Title Loan Company as trustee for Mrs. Heffron and Mrs. Cash brought this suit to recover on the notes $6,000 owned by Mrs. Heffron and Mrs. Cash and to foreclose the mortgage therefor. On September 3, 1930, Iowa Title Loan Company procured issuance of executions on the judgments against Clark Brothers held by itself and by Mrs. Koontz. On October 6, 1930, petition of intervention in this suit was filed, wherein interveners prayed that Mrs. Koontz and the Iowa Title Loan Company be made parties to this foreclosure, and that they and the sheriff *Page 878
be enjoined from selling the lots under the executions, and that the equities of the parties be determined. Iowa Title Loan Company and Mrs. Koontz appeared and joined with plaintiff in the present suit, but did not set up the notes held by them and secured by the mortgage, or demand judgment upon such notes or foreclosure on account of them. They joined with plaintiff in answering the petition of intervention and in moving to dissolve the temporary injunction which had been obtained by interveners. On October 14, 1930, the court dissolved the temporary injunction, and the same day the three lots were sold for the full amount due on the judgments at law in favor of Iowa Title
Loan Company and Mrs. Koontz, and the executions returned satisfied. The evidence is that issuance of executions on the judgments was delayed because of negotiations, the nature of which does not appear. The evidence is that:
"Our executions were perfectly well secured, and there was no reason why we shouldn't delay if we wanted to, and there seemed to be some little reason why we might delay pending the maturity of the other loan, to see what arrangement they cared to make about that. Our judgments were well secured. They were a lien upon these lots."
The value of the mortgaged premises, or of the lots, is not shown. The financial condition of the judgment debtors does not further appear.
Appellants' argument states:
"From the decree and from the intermediate rulings and orders this appeal is taken, alleging as errors relied upon for reversal, that the court erred in dissolving the temporary injunction and ordering sale, in not holding that the notes, merged into judgment, were outstanding at the commencement of this foreclosure; that the judgment creditors should be required to accept pro-rata distribution, under foreclosure, before they could resort to the sale of lots levied upon; that the trustee, acting for all of the note holders, split the cause of action in foreclosure; that the mortgage cannot be foreclosed for a part only of the note holders; that the rights of the parties are fixed as of the date of the commencement of foreclosure and the petition of intervention, and cannot be terminated upon involuntary and subsequent proceedings; and that none of the note holders have *Page 879
any priority under the mortgage, and the trustee cannot differentiate between the note holders and the mortgagors and their grantees, contrary to the stipulation of the mortgage."
[1] I. Appellants first argue that by the contract contained in the mortgage, "each note represented a pro tanto interest in the mortgage, affording security for notes covered by it, entitling each of the note holders to pro-rata distribution upon the simultaneous maturity of the obligations;" that "the mortgage lien continued as security for these judgment creditors just as effectually and just as if the judgments had not been procured. * * * The obtaining of a judgment upon a note secured by a mortgage does not take the note out of the mortgage, and the mortgage lien continues until the debt is satisfied." They therefore argue that the Iowa Title Loan Company in its individual capacity and Mrs. Koontz were necessary parties to the foreclosure. As has been shown, the company and Mrs. Koontz have joined with the plaintiff, are relying on and assert the payment of the notes held by them through the recovery and satisfaction of the judgments. Plaintiffs are not placing themselves in a position to split their suit to foreclose, as in Schnuettgen v. Mathewson, 207 Iowa 294. See Des Moines Savings Bank Trust Company v. Littell, 209 Iowa 22. Obviously, appellants are not entitled to a reversal on their contention that the Iowa Title
Loan Company and Mrs. Koontz were not joined as parties or that there was any splitting of causes of action.
[2] II. Appellants contend that by reason of the pro-rata provision in the mortgage, above quoted, the holders of the notes, including those upon which the judgments at law were rendered, should be compelled to accept pro-rata distribution of the proceeds of the foreclosure; that interveners, as subsequent purchasers of the lots, subject only to the general liens of the judgments, may require the Iowa Title Loan Company and Mrs. Koontz to first exhaust the security of the mortgage before subjecting the lots to the payment of the judgments; that they, having a lien on two funds, may, in the interest of interveners, as a subsequent purchaser of one of the properties, be required to exhaust their mortgage security before resorting to the lots in which alone interveners are interested.
As between the holders of the notes and the mortgagors the holders of the notes might obtain judgment at law upon the notes *Page 880
and enforce the judgment against property of the makers other than that mortgaged. Equitable Life Ins. Co. v. Rood, 205 Iowa 1273; Hamilton v. Henderson, 211 Iowa 29. The mortgagee might sell one or all the notes. The parties to the transfer might make their own terms with respect to their interests in the mortgage. Ralston v. Brockway, 23 Wis. 407. While contemporaneous agreements may be considered in arriving at the intention of the parties (8 C.J. 196), still each note constitutes a separate cause of action. Des Moines Savings Bank Trust Co. v. Littell,209 Iowa 22. Obviously, the owners of one or more of the notes might thus sue and recover at law, and later, if they chose, enforce the mortgage lien, while the holders of others might in the first instance seek their remedy by foreclosure. Their respective rights in the security would depend upon their own agreement.
[3] The Iowa Title Loan Company and Mrs. Koontz chose, as they had the right to do, to obtain personal judgment upon the notes held by them. These judgments became a lien upon the lots. The holders of the judgments were entitled to execution for the sale of the lots and the satisfaction of their judgments from the proceeds. Interveners acquired the lots with full knowledge of and subject to the judgments. The private agreement between the judgment defendants and the interveners, to which the holders of the mortgage or the notes secured by it were not parties, could in no wise impair the rights of the latter. The application of the doctrine of marshaling of assets is one purely of equitable cognizance, and is governed entirely by equitable principles. 38 C.J. 1366, 1367.
The burden is upon interveners to show the existence of equities which entitle them to the benefit of the doctrine; to show that the double fund is not adequate to satisfy the claims of both sets of creditors; to show that the holders of the notes secured by the mortgage can realize payment out of the mortgaged property, and that their remedy by foreclosure of the mortgage is as certain, prompt, and efficient as that through an execution sale of the lots. High v. Brown, 46 Iowa 259; 38 C.J. 1383.
In this case the judgments in favor of the Iowa Title Loan Company and Mrs. Koontz were liens when interveners acquired the lots. The case is not one of an effort upon the part of the *Page 881
creditor to subject property which has been sold by the judgment debtor when the creditor may resort to other property still owned by the debtor, as in Massie v. Wilson, 16 Iowa 390.
On the record before us the interveners are merely assignees of the interest, of the mortgagors in the lots. When they purchased the lots, the lots were subject to the lien of the judgments. As to the lots, interveners stepped into the mortgagors' shoes. They have no greater rights in the lots than had the mortgagors. They have not shown the existence of equities superior to those of the holders of the notes given by the mortgagors to the Iowa Title
Loan Company. The mortgagee was entitled to the full benefit of its contract. The mortgagee and its assignees are entitled to the remedies which the law gives to the mortgagee for the enforcement of the mortgage contract. Perry v. Saunders, 36 Iowa 427. These remedies included the right to proceed for the collection of the notes by action at law or by suit in equity for foreclosure, or (though not concurrently) the right to proceed by both remedies. Equitable Life Insurance Co. v. Rood, 205 Iowa 1273; Hamilton v. Henderson, 211 Iowa 29. No reason or superior equity in the interveners appears by which any of the holders of the notes should be obstructed in any of their rights or remedies. — Affirmed.
FAVILLE, C.J., and EVANS, KINDIG, and GRIMM, JJ., concur.
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01-03-2023
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07-05-2016
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GUSTAVO A. GELPI, United States District Judge
Plaintiff María Gazco-Hernandez sued Defendants Peter Neffenger, Secretary of the Department of Homeland Security, and others for discrimination based on age, religion, and sex, as well as hostile work environment due to sexual harassment, and retaliation. (Docket No. 3). She also asserts supplemental state law claims under Article 1802 of the Puerto Rico Civil Code. Id. Defendants moved for summary judgment. (Docket No. 65). For the reasons discussed below, Defendants' motion for summary judgment is GRANTED in part and DENIED in part . Gazco's ADEA and Title VII discrimination claims, as well as supplemental claims under Article 1802, are dismissed with prejudice. Her Title VII hostile work environment and *355Title VII/ADEA retaliation claims may proceed.
I. Local Rule 56
Before considering the merits of Defendants' motion for summary judgment, the Court must address Gazco's non-compliance with Local Rule 56. At the summary judgment stage, parties must follow the district court's anti-ferret rule, Local Rule 56. Puerto Rico Am. Ins. Co. v. Rivera-Vazquez, 603 F.3d 125, 130 (1st Cir. 2010) (summary judgment standard "operates in conjunction with a district court's local anti-ferret rule"). Section (c) instructs that "[a] party opposing a motion for summary judgment shall submit with its opposition a separate, short, and concise statement of material facts." L. Cv. R. 56(c). This opposing statement "shall admit, deny or qualify the facts supporting the motion for summary judgment by reference to each numbered paragraph of the moving party's statement of material facts ." Id. (emphasis added). Per section (e), facts "shall be deemed admitted unless properly controverted." Id. (e). Since the rule purports to prevent the Court from "rummaging through a plethoric record," the First Circuit has "held with a regularity bordering on the monotonous that parties ignore the strictures of an 'anti-ferret' rule at their peril." Puerto Rico Am. Ins. Co., 603 F.3d at 131.
Gazco's opposition is a textbook case of Local Rule 56 noncompliance. Defendants' submission contains ninety-eight facts; Gazco's opposition does not admit, deny, or qualify any, much less "by reference to each numbered paragraph." L. Cv. R. 56(c); see Puerto Rico Am. Ins. Co., 603 F.3d at 132 ("The appellants' SUF did not address, paragraph by paragraph or statement by statement, the insurers' SUF."). Instead, Gazco provides a list of seven undisputed facts and twenty-five disputed facts. (Docket No. 74). This does not comply with Local Rule 56(c). See Puerto Rico Am. Ins. Co., 603 F.3d at 132 ("Although the SUF contains eighty-eight numbered paragraphs of facts, the opposition nowhere matches up with, or even references, these numbered paragraphs. Rather, it comprises twenty-five numbered paragraphs ...."). And given that the parties have submitted ninety-one exhibits, Local Rule 56 compliance is even more important than usual to facilitate the Court's administration of justice. The Rule intends to protect the Court from having to ferret through exhibits to determine if a genuine issue of material fact exists. Hence, considering Gazco's noncompliance and the importance of Local Rule 56 in the context of ninety-one exhibits, the Court will disregard Gazco's opposing statement of facts. Defendants' submission shall be deemed admitted as uncontroverted to the extent it complies with Local Rule 56.
II. Relevant Factual and Procedural Background
María Gazco is a female, Seventh Day Adventist, over forty years of age, who began working for the Transportation Security Administration (TSA) as a Transportation Security Officer in 2002. (Docket No. 65 ¶¶ 1, 6). As of filing this case, she worked as a Master Behavior Detection Officer at the F-Band level (BDO). Id. ¶ 3. Because of her religion, she took Saturdays as a "Regular Day Off," and the TSA has always granted her requests to do so. Id. ¶ 7. Throughout her employment, the TSA had non-discrimination and anti-harassment policies that Gazco was familiar with. Id. ¶¶ 4-5.
Job Promotion Interviews
The TSA's administration guide defines the policies and procedures for interviewing and selecting BDOs. Id. ¶ 9. According to the guide, candidates are interviewed by a panel of two or three trained interviewers. Id. ¶ 10. The process consists of standard *356question and scoring procedures, in which candidates are asked identical questions and rated on a five point scale by each interviewer. Id. The interviewers then discuss their ratings among themselves to agree on an overall rating for each competency. Id. ¶ 11. Candidates who score three points or more in each competency "pass" the interview. Id. ¶ 12. Per the guide, those who pass make it to a BDO Selection Referral List, and a selecting official then chooses from any of the candidates in that list. Id. ¶ 14.
In 2008, a G-Band BDO position, a promotion from Gazco's F-Band BDO position, became available. Id. ¶ 15. Gazco, however, skipped the opportunity to interview. Id. ¶ 16. She was not selected, and did not file an Equal Employment Opportunity (EEO) discrimination charge for her non-selection. Id. ¶ 17.
In 2010, another G-Band BDO position became available. Id. ¶ 18. Gazco interviewed before a three-member panel, scored two points in the "Problem Solving Competency" and thus did not make the Selection Referral List. Id. ¶¶ 20-22. Overall, she scored fourteen points, and the prevailing candidate scored twenty-three. Id. ¶ 21, 23. The Selecting Officer decided based on interview notes and scoring sheets that did not indicate the candidates' name, sex, religion, age, or EEO activity. Id. ¶ 29. Gazco did not file a discrimination charge with the EEO as a result of her non-selection. Id. ¶ 31.
Another G-Band vacancy emerged in or around November 2011, and Gazco interviewed for it on January 9, 2012. (Docket No. 65 ¶¶ 32-33). This time she scored twenty-one points, but the prevailing candidate scored twenty-six. Id. ¶¶ 34-35. In fact, two candidates tied with twenty-six points, and the Selecting Officer broke the tie by considering both candidates' Performance Accountability and Standards System (PASS) Score. Id. ¶ 36. Like prior interviews, the panel asked identical questions, tallied scores and reached a consensus for each candidate, did not require Wednesdays and Thursdays off, and did not factor religion, age, or EEO activity. Id. ¶¶ 37-38. Moreover, Gazco does not claim that she was more qualified than the prevailing candidate. Id. ¶ 39.
Gazco applied for another G-Band BDO vacancy in January 2014. Id. ¶ 46. After undergoing the same interview process as before, the TSA filled the first three vacancies with candidates who scored thirty-eight, thirty-seven, and thirty-seven points each. Id. ¶¶ 47-50. Gazco scored thirty-six points, and tied with three other candidates. Id. ¶ 51. To break the tie, the Selecting Officer considered the candidates' 2013 performance evaluation scores. Id. Gazco finished second. Id. On February 14, 2014, she was notified of her rejection. Id. ¶ 52. As to one of the prevailing candidates, Gazco alludes to her personal views of her conduct in 2011 as proof that she was not qualified. Id. ¶ 53.
Finally, in June 2014, Gazco was appointed to a G-Band BDO vacancy while a co-worker took military leave. Id. ¶ 54. She was paid at the G-Band BDO rate and her accommodation to observe the Sabbath was honored. Id.
Alleged Religious Discrimination
On or around July 30, 2011, someone traced crosses with liquid on the walls, cubicles, and desks of the BDO office. (Docket No. 65 ¶ 55). Gazco admitted that the incident affected everyone in the office because all of the eight cubicles, which were shared by twenty-seven employees, were marked by crosses. Id. ¶¶ 57, 59. After an investigation, two employees admitted that they conducted a private prayer ceremony in the BDO office, which consisted of reading scripture, praying, and anointing the walls with holy water. Id. ¶ 61. One of them explained that there was *357no premeditation or hidden purpose behind their religious practice. Id. In response, one of the employees received a Letter of Counseling explaining that the religious act had unintended consequences and that other employees found it disrespectful and offensive. Id. ¶ 62. After this incident, no other incident of this sort has happened again. Id. ¶ 63.
Alleged Sexual Harassment
On July 27, 2011, Gazco met with other employees and officers to discuss concerns about BDO Edward Delgado's violation of standard operating procedures. Id. ¶ 64. As Gazco specified Delgado's faults, Delgado became upset and launched his own accusations against her. Id. ¶ 65. Gazco responded by alleging that he had been sexually harassing her for the past two years, until she urged him stop on March 10, 2011. Id. ¶ 65-66.
On August 1, 2011, Gazco met with two superiors and reported the alleged instances of sexual harassment. Id. ¶ 67. The TSA issued a management directive and appointed an officer to conduct an internal administrative inquiry regarding Gazco's charges. Id. ¶ 69. In September, TSA launched another investigation into the July 27 meeting. Id. ¶ 70. After interviewing and obtaining written statements from the alleged harasser, Gazco, and several witnesses, both investigators rendered written reports concluding that Gazco's claims were unsubstantiated. Id. ¶¶ 71-72. None of the interviewed co-workers recalled witnessing any sexual impropriety between Delgado and Gazco. Id. ¶ 72.
On November, 4, 2011, a TSA officer informed Gazco that the investigation yielded no evidence supporting her allegations. (Docket No. 65 ¶ 73). Nevertheless, he informed Gazco that he had ordered to keep Gazco and Delgado in separate teams to avoid potential discomfort. Id. ¶ 73. An Interoffice Memorandum addressed to Gazco repeated the promise, and told Gazco that she should inform her supervisor if she was ever appointed to work with Delgado. Id. Since then up to Gazco's deposition in March 12, 2013, Gazco was never placed on the same team as Delgado. Id. ¶ 75.
According to Gazco, Delgado stopped making sexual remarks to her in March 2011, when she asked him to stop. Id. ¶ 76. She has also admitted that he never touched her. Id. However, after stopping the alleged harassment in March, he continued to give her "dirty looks" and "smiles," which she characterized as "sinister lusty." Id. ¶ 77. Moreover, she claims that he sat under the time clock between September 2012 and January 2014, which forced her to see him when she clocked in and out. Id. ¶ 79. According to Gazco's deposition, Delgado would sit under the punch clock with his legs wide open, causing some people to laugh. (Docket No. 65-2 at 22). He did so "primarily" when it was Gazco's turn to punch. Id. Everyone who clocked in and out, not just Gazco, saw him. Id.
TSA Admonishments
In November 2011, a TSA superior appointed another official to investigate possible TSA violations by Gazco. Id. ¶ 81. After a fact-finding inquiry involving interviews of multiple co-workers, Gazco received a Letter of Reprimand for failing to exercise courtesy and tact with fellow co-workers and inappropriate conduct that violated TSA policies and regulations. (Docket No. 65 ¶¶ 82-83). The letter was hand-delivered on December 14, 2011. Id. ¶ 83.
Pursuant to an order by TSA management, who was concerned about her capabilities and behavior, Gazco underwent a mental evaluation for a fitness for duty report in February 2012. (Docket No. 65 ¶ 84). The report found her medically unfit for the BDO position and informed her *358that she would not be allowed to report to work. Id. ¶ 85. On April 27, 2012, she was terminated from her employment. Id. ¶ 86. A month later she appealed the TSA's decision and was reinstated with full back pay on June 25, 2012. Id. ¶ 87. The Office for Professional Responsibility's Appellate Board noted that that management's decision to remove Gazco was based on reliance in the finding that she suffered from a mental health condition that rendered her disqualified. Id. ¶ 88.
Contact with the Civil Rights and Liberties Office
Gazco contacted the Civil Rights and Liberties Office (CRL) on November 8, 2011, four days after learning the results of the sexual harassment investigation. Id. ¶ 89. During the EEO counseling process, she alleged discrimination based on sexual harassment, continuing hostile work environment, denial of promotions, and the letter of reprimand. Id. Subsequently, she filed her formal complaint of discrimination alleging harassment and discrimination based on sex, age, religion, and retaliation on March 5, 2012. Id. ¶ 91. More than a year later, on May 10, 2013, the Administrative Judge dismissed the EEO complaint and remanded the matter to the TSA's CRL for a final administrative decision. Id. ¶ 93. The CRL dismissed her claim; Gazco appealed, and on June 17, 2015, the CRL's decision was affirmed. Id. ¶ 95.
Gazco contacted the EEO again on February 18, 2014, after being rejected for the BDO position four days earlier. Id. ¶ 96. She filed another formal EEO complaint on June 3, 2014, restating the same claims as her prior complaint. The repetitive claims were dismissed, but the EEO decided to investigate the allegation that she was denied the opportunity to compete for a G-Band position on January 23, 2014. It also decided to investigate her reassignment to an administrative office after requesting that she perform a Fitness for Duty Evaluation. Id. ¶ 97. The complaint was referred to the CRL for a final administrative decision, and on July 5, 2014, the claims were dismissed because she failed to prove the decisions were triggered by discriminatory animus. Id. ¶ 98.
Gazco sued Defendants on September 14, 2015, alleging hostile work environment, discrimination based on gender, religion, and age, retaliation, and supplemental state law claims. (Docket No. 1).
III. Standard of Review
Summary judgment is appropriate when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) ; see FED. R. CIV. P. 56(a). "An issue is genuine if 'it may reasonably be resolved in favor of either party' at trial, ... and material if it 'possess[es] the capacity to sway the outcome of the litigation under the applicable law.' " Iverson v. City of Boston, 452 F.3d 94, 98 (1st Cir. 2006) (alteration in original) (internal citations omitted).
The moving party bears the initial burden of demonstrating the lack of evidence to support the non-moving party's case. Celotex, 477 U.S. at 325, 106 S.Ct. 2548. "The burden then shifts to the nonmovant to establish the existence of at least one fact issue which is both genuine and material." Maldonado-Denis v. Castillo-Rodriguez, 23 F.3d 576, 581 (1st Cir. 1994). The nonmovant may establish a fact is genuinely in dispute by citing particular evidence in the record or showing that either the materials cited by the movant "do not establish the absence or presence of a genuine dispute, or that an adverse party cannot *359produce admissible evidence to support the fact." FED. R. CIV. P. 56(c)(1)(B). If the Court finds that a genuine issue of material fact remains, the resolution of which could affect the outcome of the case, then the Court must deny summary judgment. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).
When considering a motion for summary judgment, the Court must view the evidence in the light most favorable to the nonmoving party and give that party the benefit of any and all reasonable inferences. Id. at 255, 106 S.Ct. 2505. Moreover, at the summary judgment stage, the Court does not make credibility determinations or weigh the evidence. Id. Summary judgment may be appropriate, however, if the nonmoving party's case rests merely upon "conclusory allegations, improbable inferences, and unsupported speculation." Forestier Fradera v. Municipality of Mayaguez, 440 F.3d 17, 21 (1st Cir. 2006) (quoting Benoit v. Tech. Mfg. Corp., 331 F.3d 166, 173 (1st Cir. 2003) ).
IV. Discussion
A. Title VII Gender and Religion Discrimination and ADEA Age Discrimination
Gazco alleges that she suffered discrimination based on gender, religion, and age when she was rejected for the G-Band vacancies in 2008, 2010, 2012, and 2014. The Court holds that the claims for 2008 and 2010 are time-barred and that Gazco cannot prove that TSA's legitimate reasons for refusing to promote her were pretext for discrimination.
1. Time-barred Claims
Before assessing Gazco's claims on the merits, the Court must dispose of those claims that are time-barred. Title VII requires a plaintiff who works for a federal agency to contact an EEO counselor within forty-five days of the alleged discriminatory act. 29 C.F.R. § 1614.105. "It is settled that a federal court will not entertain employment discrimination claims brought under Title VII unless administrative remedies have first been exhausted." Rodriguez v. United States, 852 F.3d 67, 78 (1st Cir. 2017). "This exhaustion requirement is no small matter; it 'is a condition to the waiver of sovereign immunity' and thus 'must be strictly construed.' " Id. (citing Vazquez-Rivera v. Figueroa, 759 F.3d 44, 47-48 (1st Cir. 2014) ). Similarly, under the ADEA the plaintiff is required to notify the EEO Commission about an alleged unlawful practice within 180 days of its occurrence. 29 U.S.C.A. § 633a.
The Court agrees with Defendants that Gazco's claims stemming from (1) her rejection for the G-Band BDO positions in 2008 and 2010 and (2) religious vandalism on July 30, 2011 are time-barred. Gazco first contacted the EEO counselor on November 8, 2011. (Docket No. 65 ¶ 89). Since she failed to contact an EEO counselor within 45 and 110 days after the rejection and vandalism incidents, her claims under Title VII and ADEA for these events are time-barred.
2. Burden-Shifting Framework
Title VII prohibits gender and religion-based discrimination; the ADEA applies to age-based discrimination. While Title VII requires proof that gender or religion were a motivating factor for the adverse employment action, the ADEA requires proof that age was the but-for cause. See Gross v. FBL Financial Services, Inc., 557 U.S. 167, 177, 129 S.Ct. 2343, 174 L.Ed.2d 119 (2009). Nevertheless, "[t]he basic substantive provisions of the [ADEA] are identical to Title VII, with the substitution of the word 'age' as the prohibited basis for discrimination in place of 'race, color, religion, sex, or national origin.' " R OTHSTEIN , ET AL ., 1 E MPLOYMENT L AW § 2:38 (5th ed.). Not *360coincidentally, both are decided through the McDonnell Douglas burden-shifting framework. Since the but-for/motivating factor causation difference between Title VII and ADEA does not alter the final result in this case, and the non-time-barred claims arise from the same facts, the Court will address the ADEA/Title VII claims concurrently.
As to the alleged religious, gender, and age-based discrimination in the 2012 and 2014 job interviews, Gazco must satisfy the McDonnell Douglas burden-shifting framework. See, e.g., Acevedo-Parrilla v. Novartis Ex-Lax, Inc., 696 F.3d 128, 138 (1st Cir. 2012) (citing McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973) ). First she must establish a prima facie case, and if she does, the burden shifts to the employer to "produce a legitimate, non-discriminatory reason for the termination." Id. (citing Cameron v. Idearc Media Corp., 685 F.3d 44, 48 (1st Cir. 2012) ). If the employer meets its burden, "the ball returns to the plaintiff's court, in which she must prove by a preponderance of the evidence that defendant's alleged nondiscriminatory reason was in fact a pretext for discrimination." Goncalves v. Plymouth County Sheriff's Dep't, 659 F.3d 101, 105 (1st Cir. 2011). At the final stage, the only difference between the ADEA and Title VII concerns causation: ADEA requires "but-for" causation and Title VII requires proof that sex or religion were a motivating factor.
For diligence, the Court may assume arguendo that a plaintiff has satisfied the prima facie case and proceed to the questions of legitimate business reasons and pretext. See Mesnick v. General Elec. Co., 950 F.2d 816, 828 (1st Cir. 1991) ("If we assume, arguendo, that the plaintiff established a prima facie case ... the case boils down to what we have termed the ultimate question: did [plaintiff] present sufficient evidence that [defendant's] stated reason was a pretext for retaliation?").
Defendants articulated legitimate business reasons for not promoting Gazco. The TSA had a neutral, points-based system for interviews and promotions. In 2012, the panel awarded Gazco twenty-one points, which was lower than the prevailing person's twenty-six. (Docket No. 65 ¶¶ 34-35). And in 2014, Gazco tied with three other candidates. To break the tie, the Selecting Officer chose the candidate with the highest performance evaluation score in 2013, which was not Gazco. Id. ¶ 51. The information available to the selecting official did not indicate the candidates' name, sex, religion, age, or EEO activity. Id. ¶ 29. Moreover, at least during the 2012 interview process, the panel asked identical questions, and a Wednesday-Thursday regular day off was not a part of the job description. Id. ¶¶ 37-38.
Shifting the burden back to Gazco to show that these legitimate business reasons were in fact pretext for discrimination, the Court finds that Gazco has not proffered evidence that would create a genuine issue of material fact. Instead, Gazco has only alluded to her personal views of one of the 2014 prevailing candidates' conduct in 2011 as proof that she was not qualified. Id. ¶ 53. But this does not prove that age was the but-for cause, or that gender or religion were motivating factors in the TSA's decision not to promote Gazco. Moreover, Gazco was eventually appointed to a G-Band BDO vacancy while a co-worker took military leave. Id. ¶ 54. She was paid at the G-Band BDO rate and her accommodation to observe the Sabbath was honored. Id. The fact that TSA filled a vacancy with the first runner-up in the prior interview process suggests the exact opposite "of weaknesses, implausibilities, inconsistencies, incoherencies, or contradictions in the employer's proffered *361legitimate reasons .' " Carreras v. Sajo, Garcia & Partners, 596 F.3d 25, 37 (1st Cir. 2010) (emphasis in original) (citing Santiago-Ramos v. Centennial P.R. Wireless Corp., 217 F.3d 46, 56 (1st Cir. 2000) ). The absence of any facts indicating potential inconsistencies and contradictions does not allow an inference "that the employer did not act for the asserted nondiscriminatory reasons." Id. Therefore, Defendants' motion for summary judgment on the counts of discrimination based on age, religion and gender is GRANTED .
B. Title VII: Hostile Work Environment
Defendants argue that the hostile work environment claims are time-barred. In the alternative, Defendants contend that Gazco cannot prove that she was subjected to unwelcome sexual harassment or that the alleged harassment was based upon sex. Defendants also argue that the alleged harassment was not severe nor pervasive, and, even if so, there is no basis of employer liability. The Court disagrees.
1. Time-barred Claims
A genuine issue of material fact exists as to whether Gazco's hostile work environment claim is time-barred given the continuing violation doctrine. As discussed earlier, Title VII requires a plaintiff who works for a federal agency to contact an EEO counselor within forty-five days of the alleged discriminatory act. 29 C.F.R. § 1614.105. The continuing violation doctrine allows a plaintiff to recover for "discriminatory acts that otherwise would be time-barred so long as a related act fell within the limitations period." Tobin v. Liberty Mut. Ins. Co., 553 F.3d 121, 130 (1st Cir. 2009). The doctrine "allow[s] suit to be delayed until a series of wrongful acts blossoms into an injury on which suit can be brought." Ayala v. Shinseki, 780 F.3d 52, 57 (1st Cir. 2015) (quoting Morales-Tañón v. P.R. Elec. Power Auth., 524 F.3d 15, 19 (1st Cir. 2008) ).
In March 2011, Gazco told Delgado to stop harassing her. In July, she complained, and in November, she filed a formal complaint. Indeed, more than 45 days elapsed between March, when Delgado stopped making sexual remarks at Gazco, and July, when she complained. But according to Gazco, throughout this time, Delgado continued staring at Gazco in a "sinister lusty manner," and later, sat under the time clock where she punched and spread his legs when she approached. A jury might find that these acts were related to the alleged harassment that Gazco asked Delgado to stop in March. Since these acts fall within the limitations period, she could recover for the preceding acts as well. Thus, a genuine issue of material fact exists as to whether Gazco's hostile work environment claims predating March, 2011, are time-barred.
2. Burden Shifting Framework
To state a prima facie case of hostile work environment under Title VII, a plaintiff must show:
(1) that she (or he) is a member of a protected class; (2) that she was subjected to unwelcome sexual harassment; (3) that the harassment was based upon sex; (4) that the harassment was sufficiently severe or pervasive so as to alter the conditions of plaintiff's employment and create an abusive work environment; (5) that sexually objectionable conduct was both objectively and subjectively offensive, such that a reasonable person would find it hostile or abusive and the victim in fact did perceive it to be so; and (6) that some basis for employer liability has been established.
Forrest v. Brinker Int'l Payroll Co., LP, 511 F.3d 225, 228 (1st Cir. 2007) (quoting *362Crowley v. L.L. Bean, Inc., 303 F.3d 387, 395 (1st Cir. 2002) ).
i. Second and Third Prongs: Unwelcome Harassment Based on Sex
Even assuming the harassment predating March is time-barred, a genuine issue exists as to whether Gazco was subject to sexual harassment through the non-time-barred acts consisting of staring and leg-spreading. Gazco has testified that she was subject to unwelcome harassment in the form of staring and leg-spreading, and that creates an issue of fact for the jury to decide. Second, "[f]or harassment to be based on sex it need not be an act motivated by sexual desire but rather the harassment must be gender specific." Gerald v. Univ. of Puerto Rico, 707 F.3d 7, 17 (1st Cir. 2013). The fact that Gazco spread his legs "primarily" when it was Gazco's turn to punch the time clock allows an inference that the alleged harassment was based on sex.
ii. Fourth Prong: Severe and Pervasive
Defendants also contend that the alleged harassment was not severe nor pervasive. To assess if conduct satisfies the "severe and pervasive standard," the First Circuit considers "the severity of the conduct, its frequency, whether it is physically threatening or not, and whether it interfered with the victim's work performance.' " Ponte v. Steelcase Inc., 741 F.3d 310, 320 (1st Cir. 2014) (citing Gerald, 707 F.3d at 18 ). This severity "should be judged from the perspective of a reasonable person in the plaintiff's position, considering 'all the circumstances.' " Oncale v. Sundowner Offshore Servs., Inc., 523 U.S. 75, 81, 118 S.Ct. 998, 140 L.Ed.2d 201 (1998) (quoting Harris v. Forklift Sys., Inc., 510 U.S. 17, 23, 114 S.Ct. 367, 126 L.Ed.2d 295 (1993) )
Viewed in isolation, the staring and leg-spreading might not rise to the level of severe and pervasive conduct, especially when considering First Circuit precedent. See, e.g., Ponte, 741 F.3d at 320 (resting hands on a subordinate's shoulders not severe and pervasive); Morgan v. Mass. Gen. Hosp., 901 F.2d 186, 192-93 (1st Cir. 1990) (physical contact from behind, looking at plaintiff's genitals, and unwanted touching not severe and pervasive). However, the First Circuit has warned against drawing analogies between cases to determine what conduct crosses the line and what conduct does not. Billings v. Town of Grafton, 515 F.3d 39, 49 (1st Cir. 2008) ("The highly fact-specific nature of a hostile environment claim tends to make it difficult to draw meaningful contrasts between one case and another for purposes of distinguishing between sufficiently and insufficiently abusive behavior."). This does not mean that district courts cannot draw these contrasts, but that they should be careful when doing so and not allow precedent to override the totality of the circumstances.
Considering the totality of the circumstances, a juror could interpret the staring and leg-spreading as severe and pervasive conduct. These acts occurred after Gazco asked Delgado to stop making sexual remarks. They continued after the TSA investigated the alleged sexual harassment and after Delgado was separated from Gazco, who believes that the investigators protected Delgado "because he is one of the boys." (Docket No. 65-1 at 48). A juror could infer from these facts that Gazco suffered from an abusive work environment-one where sexual harassment went unpunished and her alleged harasser felt he could misbehave with impunity at her expense.
3. Sixth Prong: Employer Liability
When a plaintiff accuses a non-supervisory co-worker of sexual harassment, *363"the employer is liable only if the plaintiff can demonstrate that the employer was negligent." Reed v. MBNA Mktg. Sys., Inc., 333 F.3d 27, 32 (1st Cir. 2003). To prove negligence, a plaintiff must prove that her employer "knew or should have known of the charged sexual harassment and failed to implement prompt and appropriate action." Id. (citing Crowley, 303 F.3d at 401 ). "Determining what constitutes a 'prompt and appropriate' employer response to allegations of sexual harassment often requires the sort of case-specific, fact-intensive analysis best left to a jury." Forrest, 511 F.3d at 232.
Gazco barely survives summary judgment on this matter. She has offered no proof that the TSA knew or should have known of Delgado's alleged harassment before she reported it in July 2011. Moreover, the Court finds that no reasonable juror could conclude that the TSA did not take prompt and appropriate action upon learning of the alleged harassment in July 2011. Upon learning of her charge, TSA launched two investigations. (Docket No. 65 ¶¶ 69-70). Two officers interviewed Gazco, Delgado, and potential witnesses. Id. ¶¶ 71-72. Despite finding that no harassment took place, the TSA ensured that Gazco and Delgado would not work together and asked Gazco to inform them if they did. Id. ¶ 73. For the relevant period, Gazco and Delgado did not work together. Id. ¶ 75. As to the continuing looks, Gazco admits that she did not complain about Delgado's behavior, and she offers no evidence as to whether the TSA knew or should have known of said behavior. Id. ¶ 77. Thus far, it would appear that the TSA is entitled to summary judgment on this matter. See, e.g., Forrest, 511 F.3d at 232 (holding, in the context of ex-lovers, that response was prompt and appropriate when employer had policy prohibiting sexual harassment, trained its managers to take disciplinary action against offenders, and took remedial action against alleged harasser three times, ultimately firing him).
But the Court must deny summary judgment based on Delgado's behavior at the time clock. Delgado would sit under the punch clock with his legs wide open, causing some people to laugh. (Docket No. 65-2 at 22). He did so "primarily" when it was Gazco's turn to punch in and out. Id. The fact that this happened in a public area before other employees creates an issue of material fact as to whether the TSA knew or should have known that this potentially harassing behavior was happening. The fact that it happened more than once, per Gazco's testimony, allows an inference that the TSA failed to take prompt and appropriate action to remedy the alleged harassment. Therefore, summary judgment on Gazco's hostile work environment Title VII claim is DENIED .
C. Retaliation
In Title VII and ADEA retaliation cases, the Court applies the three-step burden shifting framework articulated in McDonnell Douglas Corp. v. Green. First, a plaintiff must prove a prima facie case of retaliation "by showing that (1) she engaged in protected conduct, (2) she was subject to an adverse employment action, and (3) a causal connection existed between the first and second elements." Colon v. Tracey, 717 F.3d 43, 49 (1st Cir. 2013). Very close temporal proximity between protected conduct and adverse action can establish a causal connection. Clark County Sch. Dist. v. Breeden, 532 U.S. 268, 273-74, 121 S.Ct. 1508, 149 L.Ed.2d 509 (2001). Unlike discrimination cases, both Title VII and ADEA retaliation claims require but-for causation. Univ. of Texas Sw. Med. Ctr. v. Nassar, 570 U.S. 338, 133 S.Ct. 2517, 2528, 186 L.Ed.2d 503 (2013).
*364Here, Gazco satisfies the three elements of a prima facie case. She engaged in protected conduct when she contacted the CRL on November 8, 2011, filed an EEO complaint on March 5, 2012, and filed a second EEO complaint on June 3, 2014. She was subject to an adverse employment action when she received a Letter of Reprimand on December 14, 2011, a notice of proposed removal on March 19, 2012, and when she was not selected for the BDO vacancies in January 2012 and January 2014. As to the third factor, Gazco can establish causation through temporal proximity. There was only one month between her contact with the CRL and her Letter of Reprimand in 2011. Likewise, only two weeks elapsed between her formal EEO complaint and her notice of proposed removal in March, 2012. As to the first BDO vacancy, only two months passed between the CRL contact in 2011 and her rejection in 2012. See Mariani-Colon v. Dep't of Homeland Security, 511 F.3d 216, 224 (2007) (two months was "sufficient to meet the relatively light burden of establishing a prima facie case of retaliation"). As to the second BDO vacancy, Gazco fails to satisfy the prima facie test because she has not proven a causal connection between protected activity and protected conduct. But because she has met her burden of proof for at least three adverse acts, the Court must proceed to the second and third part of the McDonnell Douglas test.
If a plaintiff successfully establishes the three elements, the burden shifts to the defendant to "articulate a legitimate, non-discriminatory reason for its challenged actions." Colon, 717 F.3d at 49 (citing Provencher v. CVS Pharmacy, Div. of Melville Corp., 145 F.3d 5, 10 (1st Cir. 1998) ). And if the defendant meets his or her burden, then "the ultimate burden falls on the plaintiff to show that the proffered legitimate reason is in fact a pretext and that the job action was the result of the defendant's retaliatory animus." Id. (citing Fennell v. First Step Designs, Ltd., 83 F.3d 526, 535 (1st Cir. 1996) ). The plaintiff's "evidence [of pretext] must be of such a strength and quality as to permit a reasonable finding that the ... [challenged employment action] was obviously or manifestly unsupported." Ruiz v. Posadas de San Juan Associates, 124 F.3d 243, 248 (1st Cir. 1997). "An employee can establish pretext 'by showing weaknesses, implausibilities, inconsistencies, incoherencies, or contradictions in the employer's proffered legitimate reasons such that a factfinder could infer that the employer did not act for the asserted non-discriminatory reasons.' " Carreras, 596 F.3d at 37 (emphasis in original) (citing Santiago-Ramos, 217 F.3d at 56 ).
The TSA has provided legitimate business reasons for all of its adverse employment actions. It justified the Letter of Reprimand because it was based on a fact-finding inquiry that revealed Gazco failed to exercise tact and courtesy with co-workers. (Docket No. 65 ¶¶ 82-83). Likewise, the Notice of Proposed Removal stemmed from a mental evaluation and fitness report. Id. ¶ 85. And finally, as discussed earlier in the context of discrimination, the BDO interviews followed a procedure where the TSA promoted candidates who scored higher than Gazco.
Gazco creates an issue of fact as to pretext. On the one hand, she has offered no evidence that would prove that the legitimate business reasons for the Letter of Reprimand and BDO selection were pretextual. But on the other hand, she appealed the TSA's decision to discharge her following the mental fitness report-and won. (Docket No. 65 ¶ 87). The fact that she was reinstated after her appeal could allow a reasonable juror to infer that the reasons for the notice of removal two weeks after she filed an EEO complaint were pretext for retaliation. It is *365possible that but-for her complaint, she would not have been discharged. Therefore, Defendants' motion for summary judgment as to Gazco's retaliation claim is DENIED .
D. Supplemental Jurisdiction
Gazco asserts supplemental state law claims only under Article 1802 of the Puerto Rico Civil Code. Article 1802 is Puerto Rico's general tort statute, which provides that a person who "causes damages to another through fault or negligence" shall be liable in damages. P.R. L AWS A NN .tit. 31 § 5141. However, the United States is immune from suit unless it consents otherwise, and it "has not waived its sovereign immunity for suits under Puerto Rico's laws." Velazquez-Rivera v. Danzig, 234 F.3d 790, 795 (1st Cir. 2000). Therefore, Gazco cannot sue Defendants in their official capacity under Article 1802.
Moreover, it is well-established that a plaintiff cannot recover under Article 1802 for discrimination and retaliation causes of action. "To the extent labor legislation has created new causes of action to address previously uncovered aspects of employment relationships as in the case of discrimination and retaliation , it has been subjected to the same remedial exclusivity principle barring redress under general statutes such as Article 1802 of the Civil Code." Santana-Colon v. Houghton Mifflin Harcout Pub. Co., 81 F.Supp.3d 129, 141 (D.P.R. 2014) (emphasis added). Here, three of Gazco's four causes of action under Article 1802 involve discrimination and retaliation. (Docket No. 3 at 13-14). Since labor legislation has created causes of action under federal and state law for these aspects of employment relationships, recovery under 1802 would be barred even if the United States waived its sovereign immunity.
Gazco's fourth claim under 1802 for "slander" would also fail even if it had been brought under the Federal Tort Claims Act (FTCA). (Docket No. 3 at 14). The FTCA waives sovereign immunity for many tort-based suits, but not to "[a]ny claim arising out of ... libel [or] slander ...." 28 U.S.C. § 2680(h). "If a claim comes within one of the exceptions listed in section 2680(h), then the district court lacks subject-matter jurisdiction and must dismiss the claim." Dynamic Image Techs., Inc. v. United States, 18 F.Supp.2d 146, 149 (D.P.R. 1998). Here, the Court would lack subject matter jurisdiction over Gazco's slander allegations because Defendants are covered by the FTCA and immune from slander suits.
Since the United States enjoys sovereign immunity, Defendants' motion for summary judgment is GRANTED . Gazco's supplemental claims under Article 1802 are dismissed with prejudice.
V. Conclusion
For the reasons discussed above, Defendants' motion for summary judgment is GRANTED in part, DENIED in part. Gazco's ADEA and Title VII discrimination claims, as well as supplemental claims under Article 1802, are dismissed with prejudice. Her Title VII hostile work environment and Title VII/ADEA retaliation claims may proceed.
SO ORDERED.
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01-03-2023
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07-25-2022
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https://www.courtlistener.com/api/rest/v3/opinions/3432320/
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The collision occurred within the city of Des Moines, shortly after 1 o'clock in the morning of Christmas Day, 1940. The rough drawing following will aid in describing how and where the collision took place.
[1] The railway track shown is a part of the Douglas Avenue car line, which extends north and south along the east boundary line of Grand View Park. It is a public city park with roads and drives therein for the use of the public. The defendant owns the right of way on which its track is laid, north from Easton Boulevard which extends northeasterly along the southerly side of the park. This right of way abuts on the east side of the park. A part of one of the park roads is shown within the curved outlines just to the west of the railway track and extending to and across the track. This is the eastern exit of the park. This road across the track merges into Sheridan Avenue at and immediately west of the street railway track. In other words, the road over and across the right of way at this place connects the park road with Sheridan Avenue. Commencing almost at the south end of the crossing, the railway track runs south through a deep cut for a distance of 330 feet. For substantially this entire distance, the top of each bank of the cut is as high as or higher than the top of a streetcar. The banks taper down just as they come within a short distance of the south end of the crossing. Inside the park and along the bank *Page 1052
next to it just south of the crossing are a considerable number of trees which interfere with a view toward or from the track.
[EDITORS' NOTE: SKETCH IS ELECTRONICALLY NON-TRANSFERRABLE.] *Page 1053
A few feet north of the crossing and immediately east of the track and on the right of way, is a rectangular wooden sign erected on a post, with these words on the signboard: "LOOK OUT FOR THE CARS. RAILROAD CROSSING." This sign is indicated by the figure "3" on the drawing. On the west side of the track and just north of the park road at the crossing, and directly west of the signboard just described, is another rectangular signboard, about 3 feet long and 2 1/2 feet wide or high, set on top of a post about 6 or 7 feet above the ground and about half way down the 3-foot embankment of the track. On this signboard are these printed words in substantially this form:
"WARNING "DANGEROUS CROSSING "Not sanctioned by Des Moines Railway Company. "Drivers use it at their own risk."
The letters in the second line are about six inches high. The word "WARNING" is printed in somewhat smaller letters. The last two sentences are printed in much smaller letters. This sign is marked on the drawing by the figure "2." Just north of this signboard and west of the track is a small building used as a "waiting shelter" by those patronizing the street railway. It is built upon a slightly raised earth platform. It is marked on the drawing by the figure "1."
At the crossing, between the rails and on each side of them for some distance, earth, gravel, cinders or other substance has been filled in to make a smooth, level passageway over the track and right of way. The rails are 4 feet 8 1/2 inches apart. The crossing at the track is about 10 feet wide north and south. The surface of the crossing is about 30 inches higher than the level of the park road immediately to the west. The approach to the track up this incline is somewhat abrupt. At the southeast corner of the crossing intersection, on a bracket arm extending from a pole on the right of way from which another bracket arm carrying the trolley wire extends, is an electric street light. On the drawing the pole is marked by the figure "5."
Prior to 1937 or 1938 this crossing had been used by the *Page 1054
public, and then the defendant erected a barricade blocking the passageway east of the crossing. In 1937 or 1938 a number of the residents east of the track in this neighborhood requested the defendant to remove the barricade. This request was granted. The civil engineer who has charge of matters with respect to maintenance of right of way and crossings for defendant testified that the right of way on which the track is laid east of the park is the private right of way of the defendant, and that there is no platted street across the track at that crossing. He testified:
"The crossing was closed up for a period of time. It was opened at the request of the people that live at the east side of the track and on the east side of the road, which parallels the right of way on the east. After it was opened I had some signs placed there. The same wording has been on the signs ever since they were placed there. * * *
"My best recollection is that the road was reopened in 1937 or 1938. There were several people there who wanted the road opened. We opened it up to satisfy at least a part of the public in that neighborhood. Des Moines Railway Company owned the fee to the little piece of ground over which the crossing is located. There is a park road there that runs in the form of a loop or circle that touches the right of way at this crossing. One prong from that loop takes it over the crossing. The sign was placed there as a warning, and I would say that we did not sanction the crossing. To reopen the road we took some rails down that had been planted on the east side of the track to form a barricade. We responded to the demand of various members of the public by taking down the barricade and installing the sign. As I remember I had the sign painted. It was the intent to open the crossing upand let the public use it without regard to what I had in mind bythe use of the word `sanction'. I caused the words, `Dangerous Crossing,' to be put on the sign. That was because from myknowledge as an engineer and maintenance man I considered, andstill consider it, a dangerous crossing. In forming that beliefI was influenced by the surrounding characteristics, such as thegrade and blind stops, and that was the reason for the warningsign. * * * There *Page 1055
has never been any illuminations over the signboard, and the paint is not illuminous. * * *
"The Railway Company has never dedicated the crossing to the public as a highway. It has never been conveyed to the City." (Italics supplied.)
The plaintiff, an automobile mechanic, 36 years old, some time after 10 o'clock on Christmas Eve, went to "Sampson's Chicken Shack" at 1246 East 17th Street. He was there for about two hours and drank two or three bottles of beer while there. The place closed about 1 a.m. As he was leaving with the crowd, a married lady friend called to him and asked if he had his car and if he would take her home. His car was a 1937 Chevrolet sedan. The lady sat in the front seat with him. There were no other occupants of the car. He drove in to Grand View Park from Easton Boulevard. The broken line "ab" indicates the path of his automobile as he approached the crossing. He was not familiar with the road and did not know it led over the railway track. He testified that it was somewhat foggy, with a little snow on the ground. Another witness testified that the location is low and at that time of night there is often a mist. The day had been pleasant, with a mean temperature of 44 degrees. The automobile was traveling southeasterly at a speed of about 20 miles per hour, which he slackened to about 15 miles per hour as he turned to the left or east. He observed the rather abrupt grade as he turned east, about 25 feet from the top of the grade, and shifted into second gear and proceeded at a speed of 7 or 8 miles per hour. While the drawing, which is a tracing of part of an exhibit, is not drawn to an exact scale, it approximates 1 inch to 30 feet. From the figure "4" on the west boundary of the park road due east to the west rail of the track the distance is approximately 45 feet. The plaintiff testified that he did not know he was approaching a railway track, and did not see the signs, nor hear any warning gong or bell, nor see the streetcar until he got on the track. He then saw it approaching about 50 or 60 feet away, from the south, or his right, at a speed which he estimated to be about 40 miles per hour. He could not get the automobile out of the way and it was hit squarely on its right side and pushed north, sideways *Page 1056
on the track for a distance which witnesses, by estimate and by measurement, place at from 70 to 153 feet. After the streetcar was stopped, the automobile was found wrapped about the front of the streetcar. The plaintiff was lying partly under the left side of the automobile, and the lady was under the steering wheel. Both were bleeding and unconscious. The streetcar was backed away to permit plaintiff to be taken from under the automobile. The police were called and plaintiff and the lady were taken to the hospital. She had a fractured skull. Plaintiff did not regain consciousness until January 1st, and was in the hospital until the middle of February. The jury returned a verdict for $2,000.
The appellant assigns eight errors based on fifteen or more grounds of its motions to direct a verdict and for a new trial. However, these assignments and grounds are, in fact, all based upon a few propositions.
I. Appellant contends that the appellee was either a trespasser or a bare licensee upon its property at the time of the collision, to whom, in either event, the limit of its duty was to use reasonable and ordinary care to avoid injuring him after his position of peril was known to it. We agree with the appellant's statement of the measure of care which it would owe to either a trespasser or to a bare licensee, but we disagree with the statement that the appellee was either.
[2] Speaking generally, a trespasser is one who is not rightfully upon the land or property of another, but enters it without the consent, either express or implied, of the owner or occupier thereof.
[3] A bare licensee, sometimes called a mere licensee, is one who enters upon the land or property of another without objection, or by the mere permission, sufferance, or acquiescence of the owner or occupier. We have sometimes used the term "licensee" loosely and incorrectly instead of the term "bare licensee." In Connell v. Keokuk Electric Ry. P. Co., 131 Iowa 622, 626 et seq., 109 N.W. 177, 178, the court, in its discussion approved an instruction of the trial court which clearly and correctly defined the terms "license" and "licensee" in their various legal aspects as follows: *Page 1057
"`A license to go upon the land of another may be by an invitation either express or implied, or one may be licensed simply by the permission or consent of the owner of land to pass over same. A licensee by express invitation is one who is directly invited by the owner of the land to enter upon it, and such person is rightfully upon such land. A licensee by implied invitation is one who has been invited to enter upon the land either by the owner or occupier of the same by some affirmative act done by such owner or occupant, or by appearances which justify persons generally in believing that such owner or occupant had given his consent to the public generally to enter upon or to cross over his premises, and while such licensee is acting within the scope and limit of such implied invitation he has the lawful right to be where he is so invited.'"
The instruction then defined a "bare licensee" as we have stated herein. A licensee by invitation, either express or implied, is, of course, never a trespasser. And also, a bare licensee is ordinarily never a trespasser. It is also fundamental that one who is where he has a right to be is not a trespasser.
[4] It is uniformly stated that the owner or holder of the premises owes no duty to the unknown trespasser upon his property save that of not injuring him willfully or wantonly, and to use such reasonable and ordinary care as the circumstances demand, after his presence on the premises and his peril are known, to avoid injuring him. The following cases sustain one or both parts of this statement, in language differing sometimes in phraseology, but all to the same general tenor: Thomas v. Chicago, M. St. P. Ry., 93 Iowa 248, 252, 61 N.W. 967; Heiss v. Chicago, R.I. P. Ry., 103 Iowa 590, 592, 72 N.W. 787; Thomas v. Chicago, M. St. P. Ry., 103 Iowa 649, 657, 72 N.W. 783, 39 L.R.A. 399; Clemans v. Chicago, R.I. P. Ry., 128 Iowa 394, 396, 104 N.W. 431, 5 Ann. Cas. 1006; Graham v. Chicago N.W. Ry.,131 Iowa 741, 744, 107 N.W. 595, 7 L.R.A., N.S., 603, 117 Am. St. Rep. 445; Gregory v. Wabash R. Co., 126 Iowa 230, 235, 238, 101 N.W. 761; Johnson v. Chicago, St. P.M. O. Ry., 123 Iowa 224, 229, 98 N.W. 642; Doggett v. Chicago, B. O. Ry., 134 Iowa 690, 692, 112 N.W. 171, 13 L.R.A., N.S., 364, 13 Ann. Cas. 588; Masteller v. Chicago, *Page 1058
R.I. P. Ry., 192 Iowa 465, 469, 185 N.W. 107; Masser v. Chicago, R.I. P. Ry., 68 Iowa 602, 604, 605, 27 N.W. 776; Ramm v. Minneapolis St. L. Ry., 94 Iowa 296, 300, 62 N.W. 751; Marion v. Chicago, R.I. P. Ry., 64 Iowa 568, 572, 21 N.W. 86; Burg v. Chicago, R.I. P. Ry., 90 Iowa 106, 119, 122, 57 N.W. 680, 48 Am. St. Rep. 419; Baker v. Chicago, R.I. P. Ry.,95 Iowa 163, 172, 63 N.W. 667; Sutzin v. Chicago, M. St. P. Ry.,95 Iowa 304, 308, 309, 63 N.W. 709; Orr v. Cedar Rapids Marion City Ry., 94 Iowa 423, 429, 62 N.W. 851; Graham v. Chicago N.W. Ry., 143 Iowa 604, 616, 119 N.W. 708, 122 N.W. 573; Earl v. Chicago, R.I. P. Ry., 109 Iowa 14, 16, 19, 79 N.W. 381, 77 Am. St. Rep. 516; Purcell v. Chicago N.W. Ry., 109 Iowa 628, 631, 80 N.W. 682, 77 Am. St. Rep. 557; Way v. Chicago, R.I. P. Ry.,73 Iowa 463, 466, 35 N.W. 525; Reese v. Kenyon Co., 198 Iowa 1015, 1016, 200 N.W. 600; Thomas v. Chicago, M. St. P. Ry.,114 Iowa 169, 173, 86 N.W. 259; Davis v. Malvern L. P. Co.,186 Iowa 884, 887, 888, 173 N.W. 262; Davis v. Town of Bonaparte,137 Iowa 196, 205, 114 N.W. 896; Battin v. Cornwall, 218 Iowa 42, 47, 253 N.W. 842; Burner v. Higman Skinner Co., 127 Iowa 580, 584, 103 N.W. 802; Harriman v. Town of Afton, 225 Iowa 659, 663, 281 N.W. 183; Gwynn v. Duffield, 66 Iowa 708, 713, 24 N.W. 523, 55 Am. Rep. 286.
We have set out these numerous citations for the reason that Papich v. Chicago, M. St. P. Ry., 183 Iowa 601, 603, 167 N.W. 686, 687, contains a statement of the duty owing to a trespasser, after his peril is known, which is contrary to the rule stated in the above-cited decisions and greatly limits the duty of the property owner. This statement is as follows:
"The only duty owing such a trespasser is to refrain from wilfully injuring him after his peril is perceived, if there then be time to avoid his injury. From the vast number of cases supporting this proposition, we select a few. See Thomas v. Chicago, M. St. P.R. Co., 93 Iowa 248, at 252; Bourrett v. Chicago, M. St. P.R. Co., 152 Iowa 579, 582; Gregory v. Wabash R. Co., 126 Iowa 230 * * *."
Not one of the cited cases supports the statement, and the *Page 1059
Gregory case, 126 Iowa 230, 238, 101 N.W. 761, 763, very vigorously holds to the contrary. The court said:
"The court instructed the jury that it was not necessary, in order to entitle the plaintiff to recover, that they find that the injury was inflicted willfully or intentionally by the engineer; and of this counsel for appellant complain, taking the position that where the injured person is a trespasser, and the liability of the company is only sought to be established on the ground that, after being aware of the danger to the trespasser, the employes of the company were at fault in not avoiding such danger, the action of such employes, in order to warrant recovery, must be willful and wanton. It may be true that in some of the cases of this character this court has referred to the willful and wanton character of the acts of railroad employes in failing to take reasonable precautions to avoid injury after the trespasser was seen; but certainly this court has never announced the rule that under such circumstances the company will not be liable unless the conduct of its employes was intentional, willful, or wanton; and, so far as we can discover, the rule uniformly adhered to has been that if, after the employes in charge of the train become aware of danger to a trespasser on the track, they can, by the exercise of such care as a reasonably prudent person would exercise under the circumstances — that is, the highest possible degree of care in view of the fact that human life is involved — avert such danger, it is their duty to do so; and the company will be liable for their failure in this respect, which failure will be attributed to the company as negligence."
The statement was probably inadvertently made in the Papich case, although the writer of that opinion, in Trotter v. Chicago, R.I. P.R., 185 Iowa 1045, 1047, 171 N.W. 572, 573, with some equivocation said:
"There was no duty towards this trespasser until he was actually seen in a position of peril. When thus seen, there was a duty not to injure him wantonly or willfully, and a duty to do everything that could in reason be done, after his peril was perceived, to avoid injuring him." *Page 1060
The statement in the Papich case is repudiated.
The record here clearly establishes that the appellee was not a trespasser, but was rightfully upon the crossing as a member of the public, and that appellant by its affirmative acts and general conduct, and its acquiescence in the public use of the crossing for three or four years, had expressly and impliedly invited the appellee to be where he was when his automobile was struck. Its consent that he be there may be clearly and fairly inferred from the affirmative acts, general conduct, acquiescence of the appellant, and its knowledge that the crossing was being used by the public, without any objection on its part. The record here speaks for itself on that point and elaboration by argument or discussion is needless. The conduct of the appellant in removing the barricade as requested, and making the improvements noted, can be reasonably reconciled with no other theory than an invitation to the public to use the crossing. Its maintenance and crossing engineer expressly testified:
"It was the intent to open the crossing up and let the public use it without regard to what I had in mind by the use of the word `sanction.'"
The appellant gave to the crossing every appearance and indication that it was a public crossing — the roadway to and over the crossing, as shown by the photographs, has the marks and appearance of traffic — and it cannot relieve itself of liability for its negligence because the roadway was never platted or dedicated or conveyed to the city, or by a notice that it did not "sanction" its use and that drivers used it at their own risk. By these signs, it did not forbid the public from using the crossing. Rather, its erection of them was an invitation to use the crossing. If it had desired to forbid the use of the crossing, it need not have removed the barricade. After it had thrown open and improved the crossing for public use, and invited the public to use it, it then became bound to use the care in the operation of its streetcars over that crossing which ordinary prudence and the law demand. It could not change its duty in that respect, nor could it change the appellee front an invited licensee to a trespasser, by those signs. Furthermore, just what was the risk which drivers were to take or assume? *Page 1061
Was it the risk of negligence, or recklessness on the part of the appellant in operating over that crossing? Certainly not. It was only the risk incident to the operation of its cars over that crossing with the observance of such reasonable and ordinary care as the circumstances demanded.
In Croft v. Chicago, R.I. P. Ry., 134 Iowa 411, 427, 109 N.W. 723, 729, the plaintiff, who was a depot station agent of defendant, sued for recovery because of the negligent killing of his child and for expenses incurred in caring for his injured wife. These casualties occurred in the depot office while the wife was assisting her husband in his work, and were caused by the negligence of the defendant in the operation of a freight train, which was derailed at the depot. The defendant urged that the wife and child were trespassers. The court found that both were licensees by invitation, express or implied. In affirming a judgment for plaintiff, this court said:
"It is certain that the rightfulness of her presence being established by such finding, she cannot be held to have assumed any risk other than such as might arise out of ordinary train operation. She was not called upon to expect injury resulting from an act of affirmative negligence. To paraphrase a maxim of quite general application, she had the right to act upon the presumption that the defendant would neither unexpectedly do a thing wholly unusual, or unexpectedly do a usual thing in an unusual manner. Under such conditions, the defendant was bound to expect her presence, and it was its duty to exercise reasonable and ordinary care in the operation and conduct of its trains to protect her from injury, and a failure to do so would be negligence as to her."
[5] II. The reasons which speak against the charge that the appellee was a trespasser, as set out above, speak just as clearly and forcibly against the charge that he was "at least a bare licensee." He was not upon that crossing by the mere permission, sufferance, or nonobjection of the appellant.
"Permission involves leave and license, but it gives noright. If I avail myself of permission to cross a man's land, I do so by virtue of a license, not of a right. It is an abuse of language to call it a right: it is an excuse or license, so that the party cannot *Page 1062
be treated as a trespasser." Bolch v. Smith, 7 Hurlst. N. 736, 745.
In Severy v. Nickerson, 120 Mass. 306, 307, 21 Am. Rep. 514, the court observed, in considering this subject, that:
"The distinction which exists between the obligation which is due by owners of premises to a mere licensee, who enters thereon, without any enticement or inducement, and to one who enters upon lawful business by the invitation, either express or implied, of the proprietor, is well settled. The former enters at his own risk; the latter has a right to believe that, by taking reasonable care of himself, all reasonable care has been used by the owner to protect him in order that no injury may occur."
Both of these excerpts are taken from Flaherty v. Nieman,125 Iowa 546, 548, 101 N.W. 280, 281.
A bare licensee enters the land or property of another at his own risk, and assumes the dangers existing or inherent in the property entered. We have said that it may be stated as a general rule of law that the owner or occupier of real property is under no obligation to make it safe or to keep it in any particular condition for the benefit of trespassers, intruders, mere volunteers, or bare licensees, entering without express or implied invitation. If such a one be injured, no recovery can be had. See Wilsey v. Jewett Bros. Co., 122 Iowa 315, 319, 98 N.W. 114; Battin v. Cornwall, supra, 218 Iowa 42, 47, 253 N.W. 842; Knote v. City of Des Moines, 204 Iowa 948, 216 N.W. 52; Anderson v. Fort Dodge, D.M. S. Ry., 150 Iowa 465, 469, 130 N.W. 391; Rodefer v. Clinton Turner Verein, 232 Iowa 691,6 N.W.2d 17, 21; Wilmes v. Chicago Great Western R.R., 175 Iowa 101, 107, 156 N.W. 877, L.R.A. 1917F, 1024; Burner v. Higman
Skinner Co., supra, 127 Iowa 580, 584, 103 N.W. 802; Keernan v. Spurgeon Merc. Co., 194 Iowa 1240, 191 N.W. 99, 27 A.L.R. 579; Printy v. Reimbold, 200 Iowa 541, 546, 202 N.W. 122, 205 N.W. 211, 41 A.L.R. 1423; Flatley v. Acme Garage, 196 Iowa 82, 86, 194 N.W. 180; McMullen v. M. M. Hotel Co., 227 Iowa 1061, 290 N.W. 3. Or, as said in Nelson v. Lake Mills Canning Co.,193 Iowa 1346, 1351, 188 N.W. 990, 992: *Page 1063
"* * * and ordinarily, if one not so authorized or invited does enter, such person takes upon himself the risk of injury. In other words, if he be injured under such circumstances, the proprietor will not be chargeable with fault, simply because of his failure to equip his machinery with suitable guards."
Also, in Brown v. Rockwell City Canning Co., 132 Iowa 631, 637, 110 N.W. 12, 14, we said:
"It is unquestioned that he and the other boys were there out of idle curiosity, and, while their presence there may not be necessarily imputed to them as a fault, it did not impose on the defendant any particular duty to look out for their safety, in the absence of reasonable knowledge or anticipation that their safety would be imperiled by the maintenance and operation of its machinery."
It is true, however, that even in the instance of a bare licensee, the circumstances may be such that the owner or occupier of the premises might be liable for his injury. Such liability might arise if the owner knowingly permitted him to enter premises where there were traps or pitfalls or other hidden dangers, or there was active negligence on the part of the owner after the entrance of the bare licensee. See Ambroz v. Cedar Rapids Electric L. P. Co., 131 Iowa 336, 339, 108 N.W. 540; Connell v. Keokuk Electric Ry. P. Co., supra,131 Iowa 622, 629, 109 N.W. 178; Hart v. Mason City B. T. Co.,154 Iowa 741, 745, 135 N.W. 423, 38 L.R.A., N.S., 1173. We said in Wendt v. Town of Akron, 161 Iowa 338, 345, 142 N.W. 1024, 1027:
"The general rule doubtless is that an owner of premises owes to a licensee no duty as to the condition of such premises save that he should not knowingly let him run upon a hidden peril or wantonly cause him harm."
The record clearly establishes that the appellee was not a bare licensee, but was a licensee by the implied invitation of the appellant. He comes within the rule as expressed in 20 C.J. 353, and quoted in Loveless v. Town of Wilton, 193 Iowa 1323, 1331, 188 N.W. 874, 877, to wit: *Page 1064
"`Where the person injured was present at the place in question by the express or implied invitation of the owner or occupant, he is neither a trespasser nor a bare licensee, and as to him the general law of negligence imposes the duty of exercising due care to prevent injury.'"
[6] III. We have a reason for designating the appellee as a "licensee by implied invitation," rather than as an "invitee," as he comes clearly within the definition of that term as set out herein and as approved by the court in Connell v. Keokuk Electric Ry. P. Co., supra, 131 Iowa 622, 626, 109 N.W. 178. In the earlier and in most of our decisions the three relationships under discussion, as heretofore noted, have been designated as "trespasser," "licensee by invitation express or implied," and "bare licensee," while in some of the later decisions the term "invitee" has been substituted for the second of the above three terms. In defining the term "invitee," particularly with respect to a building or place of business, we have introduced an element of business interest to the inviter, or of mutual interest to both, which this court has never held to have been an essential element in the definition of a "licensee by invitation" in a case of the kind before us.
In Wilson v. Goodrich, 218 Iowa 462, 467, 252 N.W. 142, 144, the plaintiff contended that he was an invitee, and the defendant asserted that he was a mere licensee. In speaking of the two terms, this court said:
"An invitee to a place of business is one who goes there, either at the express or implied invitation of the owner or occupant, on business of mutual interest to both, or inconnection with the business of the owner; while a licensee is one who goes on the property of another, either by express invitation, or with implied acquiescence, solely in pursuit or furtherance of business, pleasure, or convenience of the licensee." (Italics ours.)
This court held that the plaintiff was a mere licensee and not entitled to recover. A mere licensee was not defined. We are unable to tell what the holding of the court would have been had it found the plaintiff to have been a "licensee" as defined by the court. But, since an invitee can recover only when *Page 1065
there is the interest noted, we assume that it was the thought of the court that a "licensee" could not recover unless there was a like interest.
In Nelson v. F.W. Woolworth Co., 211 Iowa 592, 596, 231 N.W. 665, the necessity that one to be an invitee must be on the premises on business of interest to the occupant or to both of them, in other words a customer or prospective customer, was the holding of the court. The plaintiff was held to be rightly in the store. The same matter of interest, with respect to the inviter and invitee, is also noted in Keeran v. Spurgeon Merc. Co., supra, 194 Iowa 1240, 1242, 191 N.W. 99, 27 A.L.R. 579.
The three cases are referred to and the definitions in the Wilson case are quoted in McMullen v. M. M. Hotel Co., supra,227 Iowa 1061, 290 N.W. 3, but in that case the plaintiff is referred to at all times as a mere licensee, although, on page 1069 of 227 Iowa, page 7 of 290 N.W., probably by inadvertence, is this statement: "Recovery by a licensee must be based uponwanton or willful misconduct on the part of the party to be charged." (Italics ours.) That would ordinarily be true only as to a mere or bare licensee.
However, such an interest is not required in order for a licensee, by invitation either express or implied, to recover against the owner or occupant in a case of the character of this one. We have repeatedly so held.
In Croft v. Chicago, R.I. P. Ry., 132 Iowa 687, 693, 108 N.W. 1053, 1055, an ably written opinion by Justice Bishop, the plaintiff, who was the wife of the station agent of the defendant, was accustomed almost daily to leave their living quarters in the depot to assist her husband in his work. While so engaged, a heavy freight train left the track and crashed into the depot, injuring the wife and killing the child who was with her. There was evidence that the defendant knew of this practice of the wife and either assented or made no objection thereto. The defendant contended that the wife was a bare licensee, to whom it owed no duty save to refrain from inflicting upon her wanton or willful injury. In affirming a judgment for the wife, this court said:
"Taking up the argument as made, it may be conceded that *Page 1066
in favor of a bare licensee on railroad property the company owes no duty to guard or repair in respect of the conditions which inhere in the property itself, or in respect of the usual and ordinary operation of trains over its tracks. And this is the doctrine of the authorities cited and relied upon by counsel for appellant to overthrow the judgment. But in the case before us a recovery was not sought on grounds calling for the application of such doctrine. The conditions inhering in the depot building had nothing whatever to do with the accident. And, as to the matter of the train operation, the contention was for affirmative and active negligence. Even as to a licensee, known to be on railway property or whose presence may reasonably be expected, the company owes the duty to avoid acts of negligence affirmative and active in character. Such is not only wholesome doctrine, but it is clearly the rule of our cases. Murphy v. Railway, 38 Iowa, 539; Clampit v. Railway, 84 Iowa, 71; Thomas v. Railway, 103 Iowa, 649. The cases arising elsewhere in which a similar rule has been adopted and enforced are quite fully collected in the opinion in the Clampit case, and we need not stop for further citation.
"Now a licensee, as that term is used in connection with railway property, and the operation of railway trains, is one who goes upon the station grounds or tracks for purposes other than transportation by permission either express or implied. The permission is express, of course, when given in terms; it is implied when the use is tolerated or acquiesced in under such circumstances, or, being known, is allowed to continue for such a length of time as that permission should be inferred. Murphy v. Railway, supra; Kay v. Railway, 65 Pa. 269 (3 Am. Rep. 628); Berry v. Railway, 124 Mo. 223 (25 S.W. 229). It follows that if plaintiff was accustomed with frequency to leave her living rooms in the depot and go into the office to assist her husband in his station work, and this was known to the officers of the defendant in charge of the division, and her conduct was acquiesced in, or at least, not objected to by them, then the rightfulness of her presence there cannot be open to question. She was, to say the least, a licensee whose presence was to be expected, and to whom the defendant owed the duty of exercising due care to avoid inflicting injury upon her. And *Page 1067
in this view a case was made proper to be submitted to the jury."
In that case, also, a notice was posted by the defendant. About a month before the accident, it tacked a notice on the waiting-room side of the office door, that no one was permitted in the office "except station employes, general officers, and telegraph repairers." The court held that this was simply a fact for the jury to consider.
In the second case, Croft v. Chicago, R.I. P. Ry., supra,134 Iowa 411, 109 N.W. 723, a judgment for plaintiff was affirmed. The questions litigated were similar to those in the first case. The husband recovered for the burial expense of the child and for the loss of her services, and also for expenses incidental to his wife's injuries. The defendant may have indirectly received some incidental benefit from the exercise of the license by the wife in assisting her husband in his work, but certainly no benefit accrued to the defendant from the presence of the child in its office.
In Clampit v. Chicago, St. P. K.C. Ry., 84 Iowa 71, 74, 50 N.W. 673, the plaintiff recovered judgment for injuries received when struck by a locomotive of defendant. He was not an employee of the defendant, but was a carpenter on his way to his work. He crossed the track at a place much used by pedestrians, just at the foot of a bluff which was approached by a stairway constructed by persons using the footway. A crossing over a ditch near the track was constructed, by someone, of railroad ties. The defendant contended that plaintiff was not rightfully on the track. In affirming a judgment for the plaintiff, the court said:
"The stairway and the ties across the ditch, as well as the path made by footmen, prominently advertised the place as a crossing used by pedestrians. No engineer or fireman passing along the tracks at that place with his eyes open, in the exercise of reasonable watchfulness and care, could have failed to see these indications of a footpath, and to understand therefrom that it was used by pedestrians, if he possessed ordinary intelligence. The defendant and the railroad company owning *Page 1068
the track, having through their employes and officers knowledge of the use of the footpath crossing, and having made no objections thereto, nor erected fences, walls or other obstructions to such use, will be presumed to assent to it, thus giving all who use the crossing license therefor. The plaintiff, therefore, was not a trespasser upon the railroad track, but is entitled to all the rights and protection of one rightfully upon it with the license of the defendant. He may recover for injuries resulting from the defendant's want of care, if not contributing thereto by his own negligence."
Many cases are cited in support of the holding.
In Thomas v. Chicago, M. St. P. Ry., supra, 103 Iowa 649, 659, 72 N.W. 783, 786, 39 L.R.A. 399, a judgment for plaintiff was affirmed on similar showing of facts. The court said:
"We believe the rule announced in Clampit's Case a just one, as applied to the facts in that case. It amounts to saying that, when the company had impliedly assented to the use of its track by persons as a footpath, its employes operating trains are charged with the duty of exercising care, diligence, and watchfulness to discover if persons are on the track at these places where they have recognized their right to be. We are not holding that at every place, and continuously along the line of a railway, the employes operating trains must be on the watch for trespassers. What we do hold is that as to persons rightfully on the track by the license and consent of the company, whether such consent be expressed in words or arise by implication, a duty rests upon the company and its employes to be on the watch for such persons at the places they may be expected to be, in view of the license and consent given.
"So, in this case, if the boy Earl was a licensee, and not a trespasser, and at a place where the company had impliedly assented to the use of its track as a footpath, it was the duty of those operating the train to exercise watchfulness and care to ascertain if persons were on said track at said place. If the jury should find that Earl was a licensee, then they must determine, in view of all of the evidence, whether the employes of *Page 1069
the company properly discharged that duty, and, if they did not, whether the failure so to do resulted in causing the injury."
In Calwell v. Minneapolis St. L. Ry., 138 Iowa 32, 36, 115 N.W. 605, 606, the plaintiff was not an employee of defendant. In reversing a judgment for the defendant on a directed verdict, the court said:
"Here the testimony shows that there was a well-defined footpath across the defendant's track. It was in the defendant's yard at Valley Junction, and was used by hundreds of people, whose duty or pleasure took them from the town to the shops of the Rock Island road, and there can be no question but what the defendant's officers and employes had full knowledge of the use being made of its track, and under such circumstances, and under the rule of the cases which we have cited, there can be no question that there was an implied license to so use its track. If this be true, it follows that the company, in the operation of its trains, owed to the users of this way the same care that it would owe the public at any highway or street crossing."
Other decisions supporting the rule of the above-cited cases are Booth v. Union Terminal Ry., 126 Iowa 8, 10, 101 N.W. 147 (cinders had been placed between and along the tracks to smooth the way); Murphy v. Chicago, R.I. P. Ry., 38 Iowa 539, 543, 544; Upp v. Darner, 150 Iowa 403, 407, 130 N.W. 409, 32 L.R.A., N.S., 743, Ann. Cas. 1912d 574; Tarashonsky v. Illinois Cent. R.R., 139 Iowa 709, 713, 714, 117 N.W. 1074; Scott v. St. Louis, K. N.W. Ry., 112 Iowa 54, 58, 83 N.W. 818; Wagner v. Chicago N.W. Ry., 122 Iowa 360, 364, 366, 98 N.W. 141; Snipps v. Minneapolis St. L. Ry., 164 Iowa 530, 534 et seq., 146 N.W. 468.
In a supplemental opinion announced after submission of petition for rehearing in Printy v. Reimbold, supra, 200 Iowa 541, 548, 205 N.W. 211, 41 A.L.R. 1423, we recognized the distinction between an "invitee" as defined in the Wilson case, supra, and an "invitee" or "licensee by invitation" in cases of this kind, in the following language:
"Counsel for appellant, in a petition for rehearing, vigorously *Page 1070
argue in support of the contention urged in their briefs upon the original submission of this case, that deceased met her death while on the premises of appellee as an invitee. It is conceded that she was not an invitee within the general doctrine that one going upon the premises of another for their mutual advantage is an invitee, but it is contended that the facts of this case bring it within the class of cases in which the defendant by his conduct has allured or induced a party to use a private way in the belief that it is open for the use of the public, thereby imposing the duty upon him of maintaining the same in a reasonably safe condition. The doctrine, as stated, is familiar, and has been recognized and applied in numerous cases in this state. Ambroz v. Cedar Rapids Elec. L.
P. Co., 131 Iowa 336; Connell v. Keokuk Elec. R. P. Co.,131 Iowa 622; Upp v. Darner, 150 Iowa 403.
"As stated in 3 Shearman Redfield on The Law of Negligence (6th Ed.) 1855, Section 706, the doctrine is as follows:
"`Invitation will also be implied from such long acquiescence as reasonably to give rise to the inference that it is invited, but it is not ordinarily to be inferred from mere passive acquiescence in what would otherwise be a trespass.'"
Other decisions having to do with licensees by invitation on the property of railway companies and others, which discuss the duty of care owing to them, are Whitman v. Chicago G.W. Ry.,171 Iowa 277, 153 N.W. 1023; Watson v. Wabash, St. L. P. Ry.,66 Iowa 164, 23 N.W. 380; Gwynn v. Duffield, 66 Iowa 708, 24 N.W. 523, 55 Am. Rep. 286; Noyes v. Des Moines Club, 178 Iowa 815, 821, 160 N.W. 215; Fischer and Knorr v. Johnson, 106 Iowa 181, 76 N.W. 658; Radenhausen v. Chicago, R.I. P. Ry.,205 Iowa 547, 218 N.W. 316.
Under the facts and the applicable law, the appellee was not a trespasser, nor a bare licensee, but he was a licensee by invitation, to whom the appellant owed the duty of exercising reasonable and ordinary care to avoid injuring him. We said in Monson v. Chicago, R.I. P. Ry., 181 Iowa 1354, 1375, 159 N.W. 679, 686, 165 N.W. 305:
"We have repeatedly held that persons who are traveling over a highway or street crossing or places where the public is *Page 1071
licensed to pass, are not trespassers, and are where they have a right to be, and the railway company owes them the active duty of keeping a lookout for them." (Citing cases.)
With respect to warning notices at crossings, both public or private, or where persons are knowingly permitted to cross, see Johnston v. Delano, 175 Iowa 498, 506, 507, 154 N.W. 1013; Hawkins v. Interurban Ry., 184 Iowa 232, 238, 168 N.W. 234; Wiese v. Chicago G.W. Ry., 182 Iowa 508, 511, 512, 166 N.W. 66.
[7] IV. Appellant assigns as error that the appellee has failed to establish negligence, and that, since the appellee was a bare licensee, the appellant's motion to direct a verdict should have been sustained. Our holding that the appellee was neither a trespasser nor a bare licensee answers appellant's argument on this assignment, as it is confined entirely to that single proposition, and does not touch upon the evidence supporting appellee's allegations of negligence, which fully sustain the verdict of the jury. It was a dangerous crossing, and the appellant fully realized it. The motorman testified: "This is not a bad crossing for the street cars. It is for the motorists." He also testified that in coming from the south a motorman could not see a vehicle until it was on the track. He applied the emergency brake when he was 25 or 30 feet from the crossing. He was going downgrade. The rail was "slick," as he puts it. He said his speed was 25 miles an hour, and that on a dry rail he could stop the car in about 70 feet. The jury could fairly have found that he was going much faster, as there was evidence that the automobile, weighing 3,000 pounds, was pushed sideways 153 feet with the four wheels hitting the ties. The evidence warranted the jury in finding that the streetcar was traveling at an excessive rate of speed, without proper control, and without warning. On the latter ground, the appellant insists that the negative testimony of the appellee does not create a conflict in the evidence. Appellee testified: "I did not hear any warning signal, such as a bell or a whistle, or anything of that sort, from the street car prior to the time the street car struck my automobile." He was driving slowly for some distance before reaching the crossing, and slackened his speed to 7 or 8 miles *Page 1072
an hour as he reached the track. He was at all times close to the track and to the crossing. He saw the streetcar approaching 50 or 60 feet away, at a speed which he estimated at "anyhow 40 miles an hour." As stated in Hoffard v. Illinois Cent. Ry.,138 Iowa 543, 550, 110 N.W. 446, 449, 16 L.R.A., N.S., 797, quoting Wigmore on Evidence, section 664, "`* * * the only requirement is that the witness should have been so situated that, in the ordinary course of events, he would have heard or seen the fact had it occurred.'" This requirement was met. He was on the spot, and not a long distance away in an enclosed house. The probative value of the so-called affirmative or positive testimony might fairly be questioned. Two passengers, of the few on the streetcar, in addition to the employees of the appellant, testified as to any warning. One of them said nothing about hearing any bell being rung or gong sounded. He testified that the first thing he heard was the noise of the emergency brakes. The other witness said he heard the electric bell ring, and the whistle blow, continuously for such a time as the car would travel approximately a quarter of a mile. There was no whistle on the streetcar, so that he was mistaken about that, and no other witness gave any such testimony as to the ringing of the bell. The motorman testified that he rang the bell. Two other employees of the appellant, who were riding home on the streetcar, did not entirely agree as to when the bell rang. They were interested as employees of the appellant, and as co-employees of the motorman. The weight and credibility of the witnesses on each side was for the jury, and not for either court, to decide. It was an "owl" car, and the last run for the motorman. The passengers were few, and the last stop had been at Easton Boulevard, a half mile or more away. It was a downgrade run. The evidence fairly indicated that other rules of care which common prudence demanded had not been observed. It was for the jury to say whether warning signals had been given. We find no error on this point.
[8] V. Appellant assigns error for the failure to sustain its motion to direct a verdict because of the contributory negligence of the appellee in going upon the tracks in the manner in which he did. He did not stop, look, and listen, it is true, but *Page 1073
we cannot say that this was contributory negligence as a matter of law. He was not familiar with the crossing. He testified that he did not know he was approaching a railway crossing, and the photographs indicate that this is not surprising. The rails of the track could hardly have been discernible by him. The headlights of the automobile were pointed southeast until he was about 20 or 25 feet from the crossing and turned east. The headlights would not even then shine on the "dangerous crossing" sign, which was to his left and too high. The west bank of the cut obscured a view of the streetcar until it was practically on the crossing. This issue was also for the jury.
[9] VI. Appellant assigns error because the court referred to its vehicle as a streetcar, instead of an "interurban" car, upon the theory that the rules of care in the operation of an interurban car, as bearing upon its operator, and the drivers of other vehicles, were somewhat different than in the operation of a streetcar and more favorable to appellant. We see little merit in this contention. First, because no such claim was ever made during the trial. It was not mentioned in appellant's pleadings. The word "interurban" was not mentioned in the trial. The car was described as a streetcar by all of appellant's employees as witnesses. The only basis for this contention is that two witnesses incidentally mentioned that the Douglas Avenue cars ran to the city of West Des Moines, but the issue now raised was never called to the attention of the court in any way, by pleading or requested instructions, or otherwise, until the motion for new trial. The appellee was never given an opportunity to answer any such claim on the trial. While the matter need not be considered by this court, it appears to us that there is no merit in this contention. Whether the car was or was not at times operated as an interurban car, at the time of the collision it was being operated in the city of Des Moines, over a crossing used as a public street or highway, as a streetcar, and subject to all of the law and rules incident to such operation.
[10] VII. Appellant assigns error because of the italicized portion of instruction No. 7, which the court gave in these words:
"You are instructed that it is the duty of those who use *Page 1074
the public streets to exercise ordinary care for the safety of the lives, limbs and property of themselves and others. Theduty of care to avoid collision that rested both upon themotorman of defendant's moving street cars, and upon theplaintiff in driving his automobile at the time and place ofsaid collision, was equal and reciprocal. The motorman of the defendant's street car, as well as the plaintiff in driving the automobile under the circumstances as disclosed by the evidence in this case, were both bound under the law to keep a lookout for approaching vehicles, and each was required at the time to exercise ordinary care in the operation of their respective cars." (Italics supplied.)
Appellant argues that it had a superior right over appellee in that it had the right of precedence. If this be conceded to be true, nevertheless the statements of law in the instruction are correct. See Hart v. Chicago, R.I. P. Ry., 56 Iowa 166, 171 et seq., 7 N.W. 9, 41 Am. Rep. 93; Grace v. Minneapolis
St. L. Ry., 153 Iowa 418, 425, 133 N.W. 672; Black v. Burlington, C.R. M. Ry., 38 Iowa 515. The italicized portion is nothing more than a statement that each should use ordinary care. If appellant desired a fuller statement of the law, it should have requested it. We find no reversible error.
[11] VIII. The automobile of appellee was wrecked beyond repair. It appears by the testimony on both sides that after the collision the automobile was junked and the appellee received $50 for the junk. He had testified that its reasonable market value before the collision was $355. The court limited the recovery on this item to $305. Appellant complains that there was no specific evidence of the reasonable market value of the automobile after the collision. There appears to have been no objection to any of the value testimony. The condition of the wrecked car had been described. As an automobile, it then had no market value. The rule of Langham v. Chicago, R.I. P. Ry., 201 Iowa 897, 208 N.W. 356, was substantially complied with. See Monson v. Chicago, R.I. P. Ry., supra,181 Iowa 1354, 1364, 159 N.W. 679, 165 N.W. 305. The appellant was in no way prejudiced.
The appellant stressed the matters with respect to intoxicating liquors during the trial and in argument to this court. But, there is no testimony that the appellee was in any *Page 1075
way intoxicated. The appellant introduced a signed statement of appellee, which it had taken from him soon after he left the hospital, that he had drunk two bottles of beer during the evening but not enough so he could feel it. The proprietor of the "Chicken Shack" testified that when the appellee left his place in the automobile "he talked with good sense, he didn't act like he was intoxicated. He walked straight. I would say he was normal in his conversation and actions." After the collision a bottle was found in the car with some liquid in it having an alcoholic odor. The police took it, but it was not produced at the trial. Appellee said he knew nothing about it and had drunk nothing but the beer. The doctor who took care of him at the hospital gave no testimony as to any evidence of liquor.
We have considered all errors assigned and carefully read the record and all authorities cited by appellant. We find no reversible error.
The judgment is affirmed. — Affirmed.
WENNERSTRUM, C.J., and MITCHELL, STIGER, OLIVER, HALE, and GARFIELD, JJ., concur.
MILLER, J., specially concurs.
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For some years before 1921, the American Bonding Casualty Company was a corporation at Sioux City, engaged in the surety and insurance business. It appears that the American Bonding
Casualty Company consolidated, or attempted to consolidate, with the Chicago Bonding Insurance Company, at Chicago, Illinois. During that period of time, the claimant, defendant and appellant, the National Glass Company, was a business organization operating in Chicago, Illinois, which, under contract with the American Bonding Company or the Chicago Bonding Company, furnished and installed broken glass covered by policies written by one or the other of those bonding and insurance companies.
In 1921, the Attorney General of Iowa brought an action to obtain the appointment of a receiver for the American Bonding
Casualty Company. Likewise that attorney general commenced a proceeding in Chicago for the appointment of a receiver for the Chicago Bonding Insurance Company. The basis for these receiverships was insolvency. Accordingly, receivers were appointed respectively for the two institutions.
At the time the receivership proceedings were instituted, the American Bonding Casualty Company or the Chicago Bonding
Insurance Company was indebted to the appellant for glass furnished and installed, as above explained, in the sum of $17,570.13. A notice was duly published under order of court by the receiver of the American Bonding Company, asking creditors to file claims within a stipulated time. Responding to the invitation extended by that publication, appellant, on September 15, 1921, filed its claim. Thus the matter remained until February 22, 1922, when the receiver of the American Bonding Company, through his attorney, filed in said cause the following *Page 1054
objections and exceptions to the claim theretofore filed by appellant:
"Now comes W.F. Grandy, the duly appointed, qualified acting and permanent receiver of the American Bonding Casualty Co., and objects and excepts to the alleged claim of the National Glass Co., No. 453, and the allowance thereof on the following grounds:
"1. For the reason that $6,176.73 of the charges made by said proof of claim is for glass furnished and services rendered at the instance and request of and for the Chicago Bonding
Insurance Co., and is not a proper claim or charge against the American Bonding Casualty Co. or the receiver of said company.
"2. For the reason that the said claimant has filed a claim with Leonard A. Brundage, receiver of the Chicago Bonding
Insurance Co. of Chicago, Ill., for the sum of $17,574.59, being based upon the same claim made against this receiver to the assets of the American Bonding Casualty Co. * * *
"9. For the reason that Leonard A. Brundage as receiver of the Chicago Bonding Insurance Co., under the order of the court in Chicago, Ill., has seized and taken possession of all the assets of the Chicago Bonding Insurance Co., amounting to more than $300,000.00 of securities for the exclusive benefit of the creditors of the Chicago Bonding Insurance Co., and for the reason that the said claimant has filed his claim with Leonard A. Brundage as receiver of the Chicago Bonding Insurance Co. and is estopped and barred from making any claim against W.F. Grandy as receiver of the American Bonding Casualty Co., or from receiving any dividends out of the assets of the American Bonding Casualty Co., said objections being duly sworn to by W.F. Grandy, Receiver of the American Bonding Casualty Co."
No action was then taken on this claim for a period of more than seven years. Appellant apparently considered their demands against these bonding companies a loss, for at no time did they take any further action to have their claim established against the American Bonding Co. On or about January 17, 1929, however, the attorney for the American Bonding Company receiver, in court at Sioux City, suggested to Jepson, Struble *Page 1055
Sifford, interveners and appellees, that several claims were filed in the receivership proceeding without local legal representation. Also the attorney for the receiver stated to appellees that these unrepresented claims were to be presented to a referee appointed in said cause. This attorney for the receiver further suggested "and wished" that appellees would secure the appointment or engagement as local counsel for the unrepresented claimants, because that would enable the receiver's attorney "in the hearings on the respective claims to arrange for the times of hearing, making of stipulations, or agreements that might possibly be necessary to be made in connection with the hearing." Complying with the request made by the receiver's attorney, appellees selected appellant's claim, and, on January 17, 1929, wrote the latter the following letter:
"Some time ago you filed a claim for $17,574.59 against the Receiver of the American Bonding Casualty Company here (Sioux City), which claim has not been allowed. A referee was appointed by our court (the state district court, at Sioux City) to hear testimony on various claims in this matter not allowed, and they are now proceeding with the taking of proof in support of the various claims. You do not seem to be locally represented and we shall be glad to look after this matter for you on the basis of one-third of the amount paid on the claim. Unless you are represented by some one doubtless there will be an entire lack of proof in support of your claim and the same disallowed."
Replying to appellees' letter, appellant wrote them March 1, 1929, to this effect:
"In reply to your letter of January 17th, we herewith authorize you to represent us in the matter of our claim of $17,574.59 against the receiver of the American Bonding Casualty Company. Your fee for this service to be one-third of amount you collect. However, if you do not succeed in collecting any portion of this claim, there will be no charge against us for this service."
Again on March 13, 1929, appellees wrote appellant this letter:
"Your understanding of our fee is correct, namely, we to *Page 1056
receive one-third of the amount paid on this claim. If nothing is paid thereon there is to be no charge for our services. We are investigating this matter and will have here, we think, sufficient proof for the establishment of the same. There are a large number of claims in this receivership, as you may well imagine. The final conclusion as to the allowance or disallowance of them cannot be arrived at for some considerable time, but we will keep in touch with the matter and when anything does come up of interest to you, we will advise you with regard thereto."
Appellees, in accordance with their employment, proceeded to obtain testimony for the purpose of establishing appellant's claim. They first investigated the receiver's books and interviewed the receiver, or his assistants. That investigation and interview revealed the fact that there was sufficient evidence in Iowa to establish the claim, and that it would not be necessary to take depositions in Chicago. So appellees appeared before the referee in the receivership proceedings, on behalf of appellant, and presented the evidence for the purpose of establishing the foregoing claim. After listening to the evidence, the referee allowed the claim in the sum of $17,570.13. Thereafter, on June 26, 1930, appellees wrote appellant in this way:
"On March 1, 1929, you engaged us (appellants) to handle your claim against the Receiver under the terms stated. The referee has made his report after a lengthy hearing on all these claims (appellant's and others) and has allowed your claim as a general claim.
"As to what will be paid thereon (full payment not being at all likely), we are unable to determine until probable further litigation in this matter is ended and the total amount of preferred claims is ascertained. We are, however, calling this decision of the Referee's to your attention at this time."
Afterwards the district court approved the Referee's report, and appellant's claim was finally allowed in the amount last-named. Following appellee's statements to appellant that the claim had been allowed by the Referee, a Mr. Goldstein, secretary and treasurer of the appellant company, came to Sioux City and interviewed appellees. A man named Ackerman, in Sioux City, apparently had written appellant about this time, *Page 1057
offering them approximately twenty per cent on its claim. Goldstein, it seems, came to Sioux City for the purpose of investigating the situation, and while here called upon appellees. He complained because appellant's claim had not been allowed as preferred rather than general. Explanation was made by appellees to the effect that the claim was such that preference thereof could not be obtained.
On July 7, 1930, appellees wrote appellant concerning the fact that its claim could not be allowed as preferred, and explained to them the reason therefor. Then, for the first time, appellant objected to the attorney fees. Referring again to the contract between appellant and appellees, it is obvious that the fees were not based upon the contingency that the claim should be allowed as preferred. The alleged ground for appellant's objection to the attorney fees seems to be based on a conversation which Goldstein had with the assistant receiver. While testifying, Goldstein stated:
"I asked him (the assistant receiver) whether attorneys were necessary or not in this case, and he (the assistant receiver) didn't think there was a necessity for attorneys at the time. He thought everything was going along all right."
Appellant refused to pay appellees the attorney fees named in the agreement, and the latter filed a lien in the receivership proceedings. Furthermore, appellees, for the purpose of foreclosing the lien, filed a petition of intervention in the receivership proceeding, to which appellant answered, raising various defenses. In brief, these defenses are that the contract was procured by fraud and is the result of a mistake and misunderstanding of facts on appellant's part. Likewise appellant declares that the fees named in the contract were so large as to shock the conscience of an equity court. When the cause was submitted to the district court, that tribunal found for the appellees, and against the appellant. A reversal of that judgment and decree is asked on the grounds named in the appellant's answer. No denial is made by appellant that the foregoing letters were written, nor is it denied by appellant that under the contract set forth in those letters, appellees performed services in obtaining the allowance of the aforesaid claim.
Consideration will now be given to appellant's propositions. *Page 1058
[1] I. Fraud being alleged, appellant declares that the burden of proving good faith and a valid consideration is upon appellees. This is true, appellant urges, because the attorneys solicited the business from their prospective client.
Underlying appellees' argument is the theory that attorneys occupy a fiduciary relationship to their clients. Whatever the law may be in that regard, we do not now decide, for it is enough to say that when the claim in question was solicited by the appellees the relationship of attorney and client did not exist. Such relationship did not come into existence until appellees' proposition was accepted by appellant. Edler v. Frazier, 174 Iowa 46; Coughlon v. Pedelty, 211 Iowa 138; Elmore v. Johnson,143 Ill. 513; Moran v. L'Etourneau, 76 N.W. (Mich.) 370. Quoted excerpts from Edler v. Frazier (174 Iowa 46), supra, reading on page 52, will illustrate the thought at this juncture:
"If the relationship of attorney and client had been established before this agreement was entered into, it may be admitted that interveners would be required to make clear showing of their good faith in the transaction; but, generally speaking, this rule does not apply with the same stringency to contracts by which that relation is inaugurated. * * *
"`Before the attorney undertakes the business of his client, he may contract with reference to his services because no confidential relation then exists and the parties deal with each other at arm's length.'"
Again the same thought is expressed in Coughlon v. Pedelty, (211 Iowa 138), supra, reading on page 141:
"If we assume, without deciding, that if this contract had been entered into by and between the plaintiff and the defendant at a time when the relation of attorney and client existed, the rule of burden for which the appellant contends would obtain, yet the rule has no application in this case, for no such relation existed between the parties prior to the making of the contract."
Manifestly, fraud is not presumed under the facts here, and the burden is upon appellant to prove that allegation.
II. Has the appellant met the burden of proof thus cast upon it? Obviously not. The basis for the alleged fraud is said to be in the fact that appellees, in soliciting the business, did not *Page 1059
inform appellant that practically no work was required in establishing the claim.
While appellees succeeded in finding evidence in the receiver's records to establish appellant's claim, yet that fact in and of itself does not indicate fraud. Appellant knew more about its claim and the evidence required to support it than did appellees at the time the contract was made. A resistance was filed to the claim by the attorney for the receiver. Appellees could not presume that the receiver's attorney was not in good faith in making that resistance. The filing of the resistance to the claim alone indicated that the receiver's attorney was in good faith in alleging the defense. It was perfectly right for appellees to assume that the receiver intended to make the defense named in the resistance. If the facts alleged in that resistance were not true, appellant had more information concerning that fact than did appellees. Certainly if appellees had not discovered sufficient evidence in the receiver's records it would have been necessary to take depositions in Chicago. And if not, appellant would have been required to bring its records and witnesses to Sioux City. Complaint therefore is made by appellant not because appellees failed in accomplishing the required result, but rather on the ground that the latter obtained the result without much effort. It contends that appellees should have informed them in the beginning that the work would be easy.
Clearly, appellees could not have imparted such information because they did not have it. Under the entire record, it is very evident that appellant has not established fraud in the inception of the contract. No fraud whatever is shown.
[2] III. Regardless of the fraud, it is further argued by appellant that both parties were mistaken concerning the amount of work to be done when the fee arrangement was made. This defense is predicated upon the allegation that both parties contemplated extended litigation. But the same was not necessary because of the receiver's willingness to allow all claims shown by his records to be just and legal.
When the contract was entered into, however, neither party knew what the receiver was going to do or what his books might show. At that time the indication was that the receiver always would resist appellant's claim. According to the resistance filed by the receiver through his attorney, the indication was that the *Page 1060
claim might be defeated. Many times in the trial of lawsuits, the final result is accomplished quite easily although every indication before the end is that there will be serious and extended litigation. In the case at bar the fee was contingent regardless of the work demanded of appellees. Appellant was interested in the result, not in the method of accomplishing the same. Had litigation continued for months, or only a day, this fee would have been the same. There is no mistake about that, and appellant well understood the situation. It was explicit in its statement that the fee must be contingent, and if nothing could be recovered, no fee would be paid. The litigation may have been long and troublesome, yet if appellees lost they could recover no fee. Such contingency was well understood by appellant. Of course, success might come to appellees easily through the trend of events. That was known by both parties when the contract was entered into. Naturally appellant could have refused to make the agreement and employed other counsel on a different fee basis, but, fully understanding the situation, it entered into the contract and there was no mistake on either side. Hence this defense is not available to appellant.
IV. Nevertheless, appellant further argues that the fee is so large in comparison with the work done that fraud is implied. This alleged extravagant fee, appellant maintains, will shock the conscience of an equity court. Therefore it asks that the contract be set aside.
Undoubtedly a fee arrangement might be so unfair as to indicate fraud and shock the conscience of a court, but that situation does not exist here. If appellees had worked for months and finally lost, would appellant volunteer compensation? Quite unlikely. A contingency was present. No one knew the result. Consequently, if the desired end was reached more easily than anticipated, it cannot be said that this particular fee is so great as to show fraud. McIntosh v. Bach, 62 S.W. (Ky.) 515. Plainly appellant had no objection to the fee until it learned that appellees were successful. Whatever the law may be under other facts and circumstances, it is certain that this fee is not unpermissibly large. Coughlon v. Pedelty (211 Iowa 138), supra (local citation 141). That is true even though the business was solicited by appellees in the manner and way before explained. Appellees' solicitation of this business did not occur until after *Page 1061
the litigation had been started. To put the thought differently, appellees offered to defend appellant in litigation already commenced. There is nothing champertous growing out of a contract entered into under such circumstances. Proper solicitation of this kind is not objectionable if conducted in an orderly and honest manner. See, as having some bearing upon the situation, Chreste v. Louisville Railway Company, 180 S.W. 49 (Ky.); Johnson v. Great Northern Railway Company, 151 N.W. (Minn.) 125. Therefore, there is no reason why the one-third contingent fee established by the district court should not stand.
Accordingly the judgment and decree of that court should be, and hereby is, affirmed. — Affirmed.
ALBERT, EVANS, MORLING, and GRIMM, JJ., concur.
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DISSENT: Hale, C.J., and Bliss, J.
The defendant was charged by a County Attorney's information with the crime of rape. This information, which was filed on May 7, 1940, states in part:
"The said Ernest Howard on or about the 26th day of April A.D., 1940, in the County of Montgomery and the State of Iowa, did rape * * *, a girl 16 years of age."
The court, upon showing by the defendant that he was without funds to employ counsel, appointed a member of the Montgomery County bar to represent the defendant. The record shows that defendant waived arraignment and entered a plea of not guilty to said information and the case was assigned for trial. The trial commenced on the 9th day of May, 1940, two days following the filing of the information. The trial was concluded about 4:00 p.m. on May 10, 1940 and shortly after midnight of that night, the jury returned a verdict finding the defendant guilty. The court fixed May 15, 1940 as the date to pronounce sentence and on that date the court sentenced the defendant to imprisonment in the State Reformatory at Anamosa, Iowa, at hard labor for a period of twenty years. On the same date the defendant perfected an appeal to the Supreme Court of the State of Iowa in the manner provided by law.
Several exceptions by the defendant as to the rulings of the trial court on the reception of evidence are noted in the abstract. These rulings have been made the basis of an appeal to this court. There was no motion for a directed verdict at the close of the State's case and no motion was filed at the close of all the evidence. There was a motion to vacate judgment and to grant a new trial, which was filed on May 15, 1940. The grounds of the motion set out were to the effect that certain new evidence had been discovered and that the verdict is contrary to the weight of the evidence. No other grounds or basis for a new trial are stated. This motion was overruled and the defendant was sentenced as previously noted. Section 14010 of the 1939 Code is as follows:
[1] "If the appeal is taken by the defendant, the supreme court must examine the record, without regard to technical errors or defects which do not affect the substantial rights of the *Page 367
parties, and render such judgment on the record as the law demands; it may affirm, reverse, or modify the judgment, or render such judgment as the district court should have done, or order a new trial, or reduce the punishment, but cannot increase it."
The attitude of this court in connection with appeals on a record such as we have in the case before us is reflected in the statement found in State v. Burns, 181 Iowa 1098, 1100,165 N.W. 346, 347, where we state:
"* * *. Unless there be a showing of error committed in the making of the record prejudicial to the defendant's rights, or the whole record shows that the defendant has not had a fair and impartial trial, such as our Constitution guarantees, we do not ordinarily interfere in criminal cases."
However, at page 1101 of the last cited case [181 Iowa 1098,165 N.W. 346, 348] we note the following statement:
"* * *. Therefore, one called to answer as for a violation of the statute in a criminal way, is entitled to call upon the State to make proof of all facts essential to constitute the crime charged. Until the proof is forthcoming from the State to establish all the essential elements of the crime charged against the citizen, the presumption of innocence stands between him and conviction. It is fundamental that every man is presumed to be innocent, when placed on trial, until proved to be guilty. To make out his guilt by proof, the proof must affirm the existence of every element essential to constitute the crime. No verdict of a jury can stand in this court where there is absence of proof of any of the elements essential to constitute the crime against which the statute is lodged."
[2] One of the essential elements in connection with the crime such as the defendant is charged with is that no defendant can be convicted upon the testimony of the person injured, "* * * unless she be corroborated by other evidence tending to connect the defendant with the commission of the offense." (Section 13900, 1939 Code of Iowa.) *Page 368
A brief review of the evidence in this case shows the following facts upon which corroboration is claimed as to the defendant being connected with this crime.
Prosecutrix and a girl companion left a restaurant in Villisca, Iowa sometime around 9:30 in the evening. Upon leaving the restaurant they walked north and met two young men and proceeded north to the end of the block with them. They then started in a northeasterly direction across a city park and met the defendant, Ernest Howard, near the corner as they started into the park. They crossed the park in a northeasterly direction and after reaching the northeast corner of this park proceeded one block east to a church. At this point the girl friend of the prosecutrix and the two young men, who they first met, walked south and the prosecutrix and the defendant walked northeasterly about seven or eight blocks to a swimming pool park near the outskirts of Villisca. The girl companion of the prosecutrix and a John Smith testified that they saw the prosecutrix and the defendant separate from the other people at the church corner. Smith testified that he had followed the group of young people about a half block behind them, as they walked to the church corner. He continued to follow the two boys and the girl companion of the prosecutrix. He did not follow the prosecutrix and the defendant. He also testified that at about fifteen or twenty minutes of eleven on the evening of April 26, 1940 he met Ernest Howard coming through the city park from the northeast. This city park is some eight blocks from the swimming pool park where the prosecutrix claims she was assaulted. With the exception of complaints made by the prosecutrix to her girl companion, with whom she stayed that Friday evening, to the effect that she had been assaulted by the defendant, and also statements made by the prosecutrix the following Monday afternoon to school authorities and a doctor claiming that the defendant had assaulted her, there is no corroboration other than that of the witness John Smith. Upon this whole record the court is confronted with the question as to whether or not there has been sufficient corroborative evidence to justify the sustaining of a verdict of guilty. It has been the general holding of this court that the mere fact that there is evidence *Page 369
that the defendant had an opportunity to commit the offense does not meet the requirements of the statute. State v. Sells,145 Iowa 675, 124 N.W. 776; State v. Egbert, 125 Iowa 443,101 N.W. 191; State v. Chapman, 88 Iowa 254, 55 N.W. 489; State v. Ashurst, 210 Iowa 719, 231 N.W. 319; State v. John, 188 Iowa 494,176 N.W. 280; State v. Hatcher, 201 Iowa 936, 208 N.W. 307; State v. Brundidge, 204 Iowa 111, 214 N.W. 569. In the present case, however, it cannot be said that the evidence shows that the defendant was present at the place where the prosecutrix claims the assault was made except by the testimony of the prosecutrix herself.
[3] It is contended by the State that the complaints made by the prosecutrix to her girl companion on the same evening following the claimed assault and to the school authorities and the doctor on the following Monday, constitute corroboration. As to this character of testimony we find the following statement in the case of State v. Egbert, 125 Iowa 443, 447, 101 N.W. 191,192:
"* * *. The complaints of prosecutrix, soon after the commission of the crime, and the condition of her body and clothing, may constitute corroboration of her testimony that a crime has been committed, but they cannot possibly constitute corroborating evidence required by the statutory provision above referred to. Certainly the declarations of prosecutrix identifying the defendant as the person who committed the crime can have no greater weight than the testimony of prosecutrix under oath to the same effect; but by the statutory provision the testimony of prosecutrix alone is insufficient to justify the conviction. * * *."
To this same effect see the following cases: State v. Powers,181 Iowa 452, 465, 164 N.W. 856, 860; State v. John, 188 Iowa 494,500, 176 N.W. 280, 282; State v. Hatcher, 201 Iowa 936, 939,208 N.W. 307, 308.
There may have been a crime committed by someone but we are unable to reach the conclusion that there was such corroborative evidence as would justify the affirmance of this conviction. We are of the opinion that it is our duty under the *Page 370
statute to hold that there was not sufficient corroboration and that it is our duty to reverse the trial court. — Reversed.
MILLER, GARFIELD, MITCHELL, SAGER, and STIGER, JJ., concur.
HALE, C.J., and BLISS, J., dissent.
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The plaintiff brought his action at law, aided by *Page 155
attachment. He caused two notes to be seized under the writ, as the property of the defendant, and caused the maker thereof to be garnished. The validity or efficiency of the procedure is not questioned. The contention presented by the defendant under his motion, and sustained by the court, was that the attached notes were exempt to the defendant because they constituted the rental for the current year of certain mortgaged real estate belonging to the defendant, which had been sold under special execution at the suit of another creditor. More specifically, the defendant claims to have been exercising his statutory right of possession during the year of redemption pursuant to a foreclosure sale, and that such right of possession during the year of redemption was in the nature of an exemption to him, and that, therefore, its proceeds, whether in the form of crops or of rental, were likewise exempt from seizure under process.
It appears that the farm was mortgaged to one McNay, who foreclosed his mortgage and purchased at execution sale, and that this defendant in the renting of the farm was exercising his right of possession during the year of redemption. This plaintiff was not the holder of the mortgage thus foreclosed. His debt herein sued on was separate and distinct from that involved in the foreclosure.
Was the rental due to the defendant under his lease subject to seizure in payment of other debts? We answered this question in the affirmative in Starits v. Avery, 204 Iowa 401. Our opinion in the cited case was handed down since the case at bar was tried in the district court. Counsel for appellees concedes that our holding in that case is fatal to him, if adhered to; but he contends that the case should be overruled, as being unsound in principle and contradictory to our previous holding. In Sayre v.Vander Voort, 200 Iowa 990, we held that the debtor's right of possession during the year of redemption was a statutory privilege which had been reserved to him; that it was realty, and not personalty; and that it was in the nature of an exemption to the debtor. Upon this predicate the appellees argue that, if such right of possession is not subject to seizure under process, then necessarily the products of the land, whether in the form of rent or crops, must likewise be exempt from seizure, — otherwise the right of possession to the debtor would be worthless; and that the last end of the debtor would be worse than his *Page 156
first; that he had better lose his right of possession in the beginning, rather than to lose its fruit at the end. The argument illustrates the legal limitations upon a right of exemption. Such right is purely statutory. The statute enumerates personal-property exemptions, and likewise real-property exemptions. The product of real property usually becomes personal property. This is true whether the real property be exempt or nonexempt. The fact that personal property is the product of exempt real property does not extend the exemption to the personalty. The crops grown upon and severed from a 40-acre homestead are nonexempt, except so far as they may be covered by the enumeration of the exemption statute. To sustain the argument of the appellee would be to say that all products of exempt real estate are, of legal necessity, likewise exempt. The able counsel for appellees would hardly contend for so broad a result of his reasoning, yet it would be the inevitable result, if his reasoning were now adopted by us.
For the reason here indicated, the order of the district court must be, and it is, reversed. — Reversed.
STEVENS, C.J., and FAVILLE, KINDIG, and WAGNER, JJ., concur.
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This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2014).
STATE OF MINNESOTA
IN COURT OF APPEALS
A15-1032
In re the Marriage of:
Marianne Ronate Reis, petitioner,
Appellant,
vs.
Thomas Michael Hallberg,
Respondent.
Filed May 9, 2016
Reversed and remanded
Bjorkman, Judge
Chisago County District Court
File No. 13-FA-13-140
Kay Nord Hunt, Lommen Abdo, P.A., Minneapolis, Minnesota; and
Virginia M. Stark, Stark Law Office, Lindstrom, Minnesota (for appellant)
Samantha J. Gemberling, Wolf, Rohr, Gemberling & Allen, P.A., St. Paul, Minnesota (for
respondent)
Considered and decided by Halbrooks, Presiding Judge; Bjorkman, Judge; and
Toussaint, Judge.
Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.
UNPUBLISHED OPINION
BJORKMAN, Judge
Appellant challenges several aspects of the judgment dissolving her marriage.
Because the district court abused its discretion by setting an incorrect valuation date for the
marital and real-property assets, by awarding insufficient spousal maintenance, by
declining to order life-insurance coverage to secure respondent’s maintenance obligation,
and by denying appellant need-based attorney fees, we reverse the judgment, except insofar
as it dissolves the marriage and obligates respondent to pay child support, and remand for
further proceedings.
FACTS
Appellant Marianne Ronate Reis and respondent Thomas Michael Hallberg were
married in 1992, and have three children, who were 12, 16, and 21 years old at the time of
the dissolution. The parties separated in 2012 and both petitioned for dissolution. The
pretrial settlement conference was held on February 21, 2014.
The parties agreed to joint legal custody of the children, with mother having sole
physical custody. And the parties agreed that father would pay mother $2,000 per month
for child support. On September 29-30, a court trial was held to determine the spousal-
maintenance award, divide marital property and marital debt, and award attorney fees. The
marriage was dissolved by judgment entered on December 24.
At the time of trial, mother was employed part time as a massage therapist at
St. Croix Regional Medical Center (SCRMC) earning monthly gross income of $1,548.87.
A vocational expert testified that mother was underemployed, and could earn $4,080 per
2
month if she worked full time in the retail massage business. Father earned monthly gross
income of $14,730 while working at Edward Jones in 2014. Mother claimed $5,453 in
monthly expenses, which did not include expenses directly related to childcare. Father
claimed $11,329 in monthly expenses. Ultimately, the district court found that mother had
$5,033 of monthly expenses and father had $8,498 of monthly expenses. The district court
found that mother was able to work full time and could earn a monthly gross income of
$4,080. The court imputed that income to mother, and awarded her temporary spousal
maintenance of $1,000 per month for ten years.
The judgment also awarded mother the $6,300 equity in the Lindstrom home, which
it calculated based on the 2013 fair-market value ($119,300) and mortgage balance
(approximately $113,000). Father received the $14,730 equity in the Forest Lake home,
based on the 2012 collective fair-market value ($198,100)1 and December 2013 mortgage
balance ($183,370). The home’s collective fair-market value in 2013 was $209,200.
Mother moved for amended findings or a new trial, asking the district court to
amend the valuation date, recalculate each parties’ income and expenses, amend the award
of spousal maintenance, award mother need-based attorney fees, and order father to obtain
life insurance to secure his support and maintenance obligations. The district court denied
the motion. As to the valuation date, the district court found that the parties agreed, during
the July 15, 2013 temporary hearing, to use the separation date to value marital debt. After
acknowledging that the parties did not directly stipulate that the date of separation would
1
The Forest Lake home included two separate real estate parcels. The collective fair-
market value refers to the aggregate of these two parcels.
3
be the valuation date for all purposes, the district court determined to use the separation
date to value all of the parties’ assets and debts.
The district court denied mother’s request for need-based attorney fees, reasoning
that since the date of the parties’ separation was the valuation date, any assets the parties
used to pay attorney fees were nonmarital.2 And the district court denied mother’s request
to secure father’s spousal-maintenance and child-support obligations with life insurance,
noting that because the support was temporary, it was not an “exceptional case” that
required life insurance. Mother appeals.
DECISION
I. The district court abused its discretion by using the parties’ separation date as
the valuation date.
A district court “shall value marital assets for purposes of division between the
parties as of the day of the initially scheduled prehearing settlement conference, unless a
different date is agreed upon by the parties, or unless the court makes specific findings that
another date of valuation is fair and equitable.” Minn. Stat. § 518.58, subd. 1 (2014). We
review a district court’s decision to use a valuation date other than the prehearing
settlement conference for an abuse of discretion. Grigsby v. Grigsby, 648 N.W.2d 716,
720 (Minn. App. 2002), review denied (Minn. Oct. 15, 2002).
Mother argues that the district court abused its discretion by setting the valuation
date for the parties’ assets as the separation date. This argument has merit. The district
2
The district court required mother to pay father $1,000 of attorney fees for a violation of
court rules.
4
court found that the parties did not directly stipulate to a valuation date other than the
prehearing settlement conference, but, at the July 15, 2013 temporary hearing, the parties
agreed to be responsible for the credit-card debts that each incurred since the separation
date. The district court made no findings regarding whether use of the separation date for
all valuation purposes is fair and equitable as required by Minn. Stat. § 518.58, subd. 1.
Moreover, the record shows that the agreement the parties reached in July 2013 was limited
to specific debts the parties discussed during that hearing. Nothing occurred during the
hearing or contemporaneously that indicated the separation date would be used as the
valuation date for all of the marital assets and debts. This is evidenced by the fact that the
parties’ evidentiary submissions at trial focused on the pretrial date as the valuation date.
On this record, the district court abused its discretion by using the separation date as the
valuation date.
We specifically note clear error in the district court’s valuation of the marital real
property. The district court awarded mother the Lindstrom home, which had a 2013 value
of $119,300 and a mortgage balance of approximately $113,000. Father was awarded the
Forest Lake home, which had a 2012 collective fair-market value of $198,100 and a 2013
mortgage balance of $183,370. The record shows that the Forest Lake home’s collective
fair-market value in 2013 was $209,200. The district court clearly erred by using different
dates to value the two homes. By using the 2012 value of the Forest Lake home, the district
court attributed an equity value of $14,730 to father. If the district court had used the 2013
value, an equity value of $25,830 would have been attributed to father. On remand, the
5
district court should calculate the equity values for the real property using the same
valuation date.
II. The district court abused its discretion by awarding mother spousal
maintenance of $1,000 per month for ten years.
A district court may award spousal maintenance if a spouse demonstrates that she
does not have sufficient property to provide for her reasonable needs or cannot reasonably
provide adequate self-support. Minn. Stat. § 518.552, subd. 1 (2014); Robert v. Zygmunt,
652 N.W.2d 537, 544 (Minn. App. 2002), review denied (Minn. Dec. 30, 2002). Such
awards must be in an amount and duration that the district court deems just after
considering the ability of the recipient to provide for her needs independently, the age and
health of the recipient, the standard of living during the marriage, the length of the
marriage, the contribution of both parties to marital property, and the resources of the
obligor. Minn. Stat. § 518.552, subd. 2 (2014). “The purpose of a maintenance award is
to allow the recipient and the obligor to have a standard of living that approximates the
marital standard of living.” Peterka v. Peterka, 675 N.W.2d 353, 358 (Minn. App. 2004).
We review a district court’s spousal maintenance award for an abuse of discretion.
Dobrin v. Dobrin, 569 N.W.2d 199, 202 (Minn. 1997). Generally, a district court’s
resolution of a question committed to its discretion will, on appeal, be ruled to be an abuse
of the district court’s discretion if the district court’s exercise of its discretion (a) is based
on an erroneous application of the law, (b) is based on findings of fact that are unsupported
by the evidence, or (c) results in a resolution of the question that is contrary to logic and
the facts on record. See, e.g., Dobrin v. Dobrin, 569 N.W.2d 199, 202 (Minn. 1997). We
6
view the evidence in the light most favorable to the district court’s findings and defer to its
credibility determinations. Vangsness v. Vangsness, 607 N.W.2d 468, 474 (Minn. App.
2000). Findings of fact related to spousal maintenance will be upheld unless they are
clearly erroneous. Gessner v. Gessner, 487 N.W.2d 921, 923 (Minn. App. 1992). Mother
challenges both the amount and duration of spousal maintenance. We address each issue
in turn.
Amount of Award
Mother first argues that the district court clearly erred when it found that she was
underemployed and imputed income to her based on her earning capacity. We are not
persuaded. The ability to become self-supporting is a relevant factor in awarding spousal
maintenance. Passolt v. Passolt, 804 N.W.2d 18, 25 (Minn. App. 2011), review denied
(Minn. Nov. 15, 2011). A district court may impute income to a party seeking spousal
maintenance without making a finding that the party has decreased her income in bad faith.
Id.3
At the time of trial, mother had been employed as a part-time massage therapist at
SCRMC for six years. She earned $1,548.87 per month pursuant to a written contract that
commenced in September 2013 and continued for a term of five years. Both mother and
3
Mother also points out that “[c]ourts cannot force a spouse to work at a specific job.”
Flynn v. Flynn, 402 N.W.2d 111, 114 (Minn. App. 1987), review denied (Minn. Nov. 24
1987). But the holding in Flynn relies on Resch v. Resch, 381 N.W.2d 460, 462 (Minn.
App. 1986), which states that although a “court cannot direct a person to work at a specific
job against [her] will” it is not prohibited “from directing a person to pay support
commensurate with a wage [s]he could earn if [s]he sought employment in an occupation
for which [s]he is trained and has the present ability to perform.”
7
her supervisor expected the contract to be renewed.4 Father’s vocational expert—Jan
Lowe—testified about mother’s earning potential. Lowe prepared a market report that
indicated jobs that were available in mother’s labor market that paid between $42,000 and
$67,000 per year. Lowe concluded that based upon mother’s education and experience,
she could work 30 hours per week for 48 weeks per year, and expect to earn $49,000. This
salary equates to roughly $4,080 of gross monthly income. Mother challenged this
evidence, pointing to her own research that revealed no massage therapist positions that
paid the level of income Lowe reported. But the district court found Lowe’s testimony to
be more credible; we defer to the district court’s determinations of witness credibility.
Vangsness, 607 N.W.2d at 474. Because record evidence supports the district court’s
findings that mother has the potential to earn $4,080 gross monthly income, we discern no
clear error in the district court’s finding that mother is voluntarily underemployed.
But we are not persuaded that the district court acted within its discretion by
immediately imputing monthly gross income of $4,080 to mother. Immediate imputation
ignores the fact that mother is presumably under contract with SCRMC and requires some
amount of time to secure other employment to reach the higher earning capacity. And
mother works limited hours to care for the parties’ children, one of whom is still a minor.
Mother next argues that the district court incorrectly calculated the parties’
reasonable monthly expenses. We agree. Spousal maintenance is designed to provide the
4
Record evidence indicates that mother was under contract with SCRMC from September
2008 until September 2013. The Director of Rehab Services at SCRMC testified that they
intended to renew the contract when it expired. But the record does not indicate the
duration of the renewed contract or whether it was in fact renewed.
8
recipient with sufficient resources to maintain the circumstances and living standards the
parties enjoyed during the marriage. Lee v. Lee, 775 N.W.2d 631, 642 (Minn. 2009)
(stating that a party shall receive maintenance in an amount that is reasonably needed to
support one’s self). Mother submitted a list of monthly expenses totaling $5,453. The
district court rejected her claimed expenses for car-replacement savings, furniture-
replacement savings, household supplies, and general savings as either duplicative or
inappropriate because they are savings based, and concluded that the reasonable monthly
expenses for mother and the children are $5,033. The district court reduced father’s
claimed expenses by $831, excluding expenses related to home maintenance, gifts, client
appreciation, car-replacement savings, and personal-assistance expenses. And the district
court subtracted $2,000 from an unspecified category of father’s expenses,5 finding his
reasonable monthly expenses are $8,498. These calculations are flawed in several respects.
First, the district court found that mother’s claimed expenses include expenses
associated with her children; the record indicates that they do not. The parties agreed that
father will pay mother $2,000 per month for child support, and neither party disputes this
amount on appeal.
Second, the district court rejected expenses claimed by both parties on the ground
that they are “savings based.” The fact that an expense is related to savings does not, in
and of itself, mean it is unreasonable. See Kampf v. Kampf, 732 N.W.2d 630, 634 (Minn.
5
Father lists “Child support” and “Spousal Maintenance” as each costing $2,000 on his
expense sheet. The district court subtracted one of these categories from the calculation of
father’s expenses, but it is not clear which category. On remand, the district court should
specify which category was deducted from father’s claimed expenses.
9
App. 2007) (stating that savings expenses can be included in reasonable monthly expenses
if they were part of the standard of living during marriage), review denied (Minn. Aug. 21,
2007). In the absence of evidence or a finding that the parties did not save money for future
expenditures during the marriage, the district court erred by rejecting expenses solely
because they are savings based.
Third, the district court inconsistently attributed credit-card debt as a monthly
expense to each party. Father’s listed expenses included $600 for “credit card/finance
charges.” Although mother did not similarly include monthly credit-card payments in her
list of monthly expenses, the district court was aware of her credit-card debt. Account
balances from the parties’ credit-card accounts were admitted into evidence, and in the
judgment, the district court attributed $10,233.57 of the parties’ outstanding credit-card
debt to mother. The district court erred by including $600 monthly credit-card payments
in father’s expenses and not attributing a corresponding amount to mother.
Finally, the district court permitted father to claim $1,000 per month for college
expenses incurred by the parties’ adult child. A “[district] court must fairly determine
maintenance without considering the needs of the adult children in setting the amount of
maintenance.” Musielewicz v. Musielewicz, 400 N.W.2d 100, 103 (Minn. App. 1987),
review denied (Minn. Mar. 25, 1987). The district court erred by including the adult child’s
college costs in father’s monthly expenses.
Duration of Award
Generally, a district court has broad discretion in deciding the duration of spousal
maintenance. Reif v. Reif, 410 N.W.2d 414, 416 (Minn. App. 1987). But we may reverse
10
a decision regarding an award’s duration if it is against logic and facts on the record.
Napier v. Napier, 374 N.W.2d 512, 515 (Minn. App. 1985). If a district court is uncertain
about the recipient’s ability to become self-supporting, it must order permanent spousal
maintenance. Maiers v. Maiers, 775 N.W.2d 666, 668 (Minn. App. 2009).
Mother asserts that the district court abused its discretion by awarding temporary
maintenance for only ten years. We agree. The district court found that ten years was
“sufficient to allow [mother] to be fully self-supporting by allowing her time to find full-
time employment or pursue schooling.” This finding is inconsistent with the district court’s
imputation of income to mother in an amount less than what the court found her reasonable
expenses to be. Indeed, the district court found that mother requires spousal maintenance
of $1,000 per month to cover her expenses even after income is imputed to her. Nothing
in the record suggests that in ten years, mother’s income potential will increase by $1,000
per month, or her expenses will decrease by that amount.
In sum, the record supports the district court’s finding that mother has the potential
to earn $4,080 per month in her chosen profession. But the district court miscalculated the
parties’ monthly expenses and abused its discretion by limiting spousal maintenance to ten
years. Accordingly, we remand for the district court to recalculate the parties’ monthly
expenses and determine the correct amount of spousal maintenance. The district court
should also reconsider the duration of the award and determine whether the evidence
supports immediate imputation of $4,080 in gross monthly income to mother.
11
III. The district court applied the wrong standard for deciding whether father must
secure his spousal-maintenance obligation with life insurance.
Unless otherwise agreed upon or expressly provided in a dissolution judgment, an
obligation to pay future spousal maintenance terminates upon the death of either party.
Minn. Stat. § 518A.39, subd. 3 (2014). But a district court “may require sufficient security
to be given for the payment of [maintenance] according to the terms of the order.” Minn.
Stat. § 518A.71 (2014). “The district court has discretion to consider whether the
circumstances justifying an award of maintenance also justify securing it with life
insurance.” Kampf, 732 N.W.2d at 635 (quotation omitted).
The district court denied mother’s request to have father’s spousal-maintenance
obligation6 secured by a life-insurance policy based on its legal conclusion that security for
future support payments is only required in exceptional cases. Fastner v. Fastner, 427
N.W.2d 691, 701 (Minn. App. 1988). But in Kampf, we held that the “exceptional-case
standard” was eliminated by the 1985 amendments to the spousal-maintenance statutes.
732 N.W.2d at 635. Under the applicable law, district courts must consider the obligee’s
age, education, vocational experience, and employment prospects when determining
whether a spousal-maintenance award should be secured by life insurance. Id. By denying
mother’s request solely on the ground that this is not an exceptional case, the district court
failed to consider the relevant factors justifying security that are described in Kampf. On
6
Mother requested the district court to order that both the child-support and spousal-
maintenance obligations be secured by life insurance. But on appeal, mother only argues
that the spousal-maintenance obligation should be secured.
12
remand, the district court must consider the Kampf factors to decide whether father’s
spousal-maintenance obligation should be secured by life insurance.
IV. The district court must reconsider mother’s entitlement to need-based attorney
fees.
In marital-dissolution proceedings, the district court “shall” award attorney fees if
it finds (1) the fees are necessary to a party’s good-faith claim; (2) the party from whom
fees are sought has the means to pay them; and (3) the party who seeks fees does not have
the means to pay them. Minn. Stat. § 518.14, subd. 1 (2014); Schallinger v. Schallinger,
699 N.W.2d 15, 24 (Minn. App. 2005), review denied (Minn. Sept. 28, 2005).
The district court denied mother’s attorney fee request because it found she had the
means to pay fees out of her spousal-maintenance award.7 But, as noted above, the district
court’s findings regarding the parties’ respective income and expenses are flawed. And
the district court did not include mother’s past or future legal expenses in its expense
calculation. Because numerous errors impacted the district court’s decision to deny mother
need-based attorney fees, the district court should reconsider her request on remand along
with the spousal-maintenance and property-division issues. We leave to the district court’s
discretion the issue of whether to reopen the record on remand.
Reversed and remanded.
7
Mother asserts that because the profit-sharing account and home equity are not liquid
assets, they should not be considered in determining her ability to pay attorney fees. But
in Schallinger, we affirmed the denial of attorney fees despite the fact that the spouse
seeking fees liquidated a portion of her investment accounts to pay her attorney. 699
N.W.2d at 24. Although mother may have to liquidate a portion of the profit-sharing
account to pay her attorney, that alone does not necessitate an order for need-based attorney
fees.
13
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The transactions involved in this litigation occurred in 1924. The litigation was begun in 1925. The pendency of the litigation has been attended with much mortality, including some of the participators in the transaction and the attorney who brought *Page 92
the action for the plaintiff in the first instance. In June, 1924, the Citizens State Bank, defendant, was a going concern in the town of Waukon. It closed its doors in January, 1925. In June, 1924, it sought to make itself a depository of the funds of the Independent School District of Waukon. Its officers included Niehaus as president; Narum as cashier; Beddow as assistant cashier and vice president; Campbell as bookkeeper; and Arnold as a vice president and director, but not otherwise active. Niehaus became a member of the board of the independent school district and Narum became the treasurer of the same district. In order to accomplish their purpose, it became necessary that the bank furnish a so-called "depository bond", and that Narum furnish a so-called "treasurer's bond." The treasurer's bond is known in the record as Exhibit 1; and the depository bond furnished by the bank is known as Exhibit 2. The latter is the bond sued on. We shall refer to it in the discussion as the depository bond, and to the other as the treasurer's bond. It was the purpose of the bank to furnish suretyship for both bonds by the voluntary signing of its own officials as sureties. On June 12, 1924, both bonds were drawn up in the bank. They were drawn up upon blank forms intended for such purpose, but the forms were not identical. Each bond as drawn up included in the body thereof the names of the purported sureties. These were three in number, — Niehaus, Beddow, and Arnold. In the first instance each of them was signed by Niehaus and Beddow as sureties and were presented to the school board in that form. The finance committee deferred their approval until the signature of Arnold should be obtained. The failure of Arnold to sign the bonds in the first instance was because the bank officials had not had access to him. After their return to the bank, the transaction was neglected for a couple of weeks. Later they were returned to the president of the school board duly signed by Arnold. Whether they were both returned at the same time does not clearly appear. It does appear that Narum obtained the signature of Arnold upon the treasurer's bond and saw him sign the same. No witness remembers seeing Arnold sign the depository bond here in controversy. Both of these bonds came to the finance committee from the president of the school board, Dr. Stillman, who subsequently died prior to the trial. As a matter of evidence, Arnold denies the signature on each of the two bonds. The issue turns upon opinion evidence, expert and non-expert, and upon the circumstances which constitute the setting in *Page 93
which the transaction originated. The direct evidence is that of Narum, who claims that he saw Arnold attach his signature to the treasurer's bond. He does not remember whether he saw him sign the other bond or not. The circumstance which is emphasized by the defendant is that the signature on the depository bond is somewhat smaller than his usual signature. As above stated, the depository bond was written upon a blank form. This blank form had two spaces for the signatures of sureties and no more. This space had been appropriated by the first two sureties, who signed. The Arnold signature was attached underneath the other two in the restricted space between them and the margin of the paper. This is the explanation of the reduced size of the signature. It is also true that this blank form had only two blank spaces for the qualification of sureties, and these blanks had been appropriated by the first two signers. This is the explanation of the failure of Arnold to qualify as a surety. It is not claimed that the alleged failure of Arnold to sign either bond was the result of any refusal or unwillingness on his part. His explanation of his denial of the signature is: "No one ever asked me to sign either one of those exhibit. I was not present when they were signed by any one else." He admits the signing of other bonds. The implications of the record are that the bank officials usually signed their depository bonds and that no difference of opinion ever arose between them on that subject. Arnold admits, as a witness, that he signed other similar bonds upon the mere request of other officials. The bank became, not only a depository of the money of the independent school district, but a depository also of the public money of the county. The same officials signed the bond for the county as those that signed for the school district. This includes Arnold as an admitted signer.
To accept the defendant's denial at its face is to confront a great improbability which must be considered as a circumstance in the case. If the defendant did not attach his name to the bond, then some one else did. The case thus presented is not one where an agent has innocently assumed to act for another without adequate authority. Some one is guilty of a felonious forgery. The felony is indicated by the fact that the perpetrator imitated the signature of the defendant, and thereby impersonated him. What conceivable motive could there be for such action? He had nothing to gain by such a course and nothing to hope for. There is not a circumstance in the record that points to the possibility of any motive for any *Page 94
third person to forge the name of the defendant. There was not a moment when the signature of the defendant was not available upon request. The fact that the parties to the transaction had forgotten whether they actually saw the various makers attach their signatures to the instrument is not strange or unusual. There was no controversy involved. A witness might readily remember the occasion of the signing and yet forget the detailed acts of each person. Of the witnesses testifying to the signature, those of the plaintiff impress us as more credible and their testimony more consistent with all the circumstances surrounding the parties than those of the defendant. An observation of the signature and a comparison thereof with other admitted signatures impresses us as giving more support to the genuineness of the signature than to the contrary. We will not attempt an analysis of the expert evidence. Sufficient to say that that offered by the plaintiff strongly supports the identity of the signature as genuine. That offered on behalf of the defendant is not persuasive. It is too lengthy to justify an attempted analysis of it. We shall content ourselves with illustrative quotations from the testimony of the defendant's principal expert. We quote:
"Examining the capital J J's in all of the signatures of Exhibit 40 and in all of the exhibits I have examined and all the other exhibits I have identified here this morning as genuine signatures of Mr. Arnold I have been compelled to the conclusion that Mr. Arnold has no standard way of writing so far as the genealogy of his J's is concerned and I am not able to say whether he wrote the J J's in Exhibits 1 and 2 standing out alone. While these J J's in Exhibits 1 and especially in 2 differ from one another they also differ from the J J's throughout Mr. Arnold's standard signature. I was impressed and believe that Mr. Arnold is not able to confine himself to the space in writing that is necessary to make the standard capital J and therefore if he makes a hundred J's there seem to be a hundred different J's. I left the genealogy of the J's to make no decision. * * *
"Forgeries are of four kinds, one where a person writes a man's name with hardly any effort to imitate the signature, making it easily detectable. The second kind is tracery, traced forgery but there is no element of tracing in this forgery. The third and most common is assimilated forgery. This is divided into assimilated and mentally assimilated forgery. The assimilated forgery is where the *Page 95
forger gets an original or standard signature and brings it into close proximity to the line on which he is going to force the signature in order that by the eye following the signature he may make a fair pictorial reproduction of the signature. I decided that in this case the forgeries were made by mental assimilation or forgery; that is, the forgery, if it be a forgery, was made by a writer believing he possessed in his mind the way that Mr. Arnold writes his name and therefor he wrote the name J.J. Arnold. I arrived at the conclusion that this is a mentally assimilated forgery; that the man didn't have before him a standard signature of J.J. Arnold but that he wrote the signature from what he believed the signature looked like. * * *
"The J J's, so far as the geometric form is concerned, might have been written by Mr. Arnold. It is hard to tell what Mr. Arnold might have written in the J J's on account of the differentiation of the form. He hasn't any form but an examination of the second J reveals a J unusually small and peculiar in its formation, the upper right-hand portion being practically a straight line. * * *
"I would agree that Mr. Osborne's text is recognized by all experts as the outstanding work. If he says with reference to the kinds of forgery that the man who does it from memory is so rare that he would never expect to find one I would simply express disagreement with his statement because it has not been my experience. I can reproduce the Arnold signature now and couldmix it up with his signature, mix up mine with his, and submit itto any expert and defy them to pick out which were written by meand which were written by Mr. Arnold himself. * * *
"I will say that if the writer of those signatures had had a copy of Mr. Arnold's signature he would have written so as to make the J J's under Mr. Arnold's normal signature and also the A and when he got through that signature from the copy it would approximate not only the vertical formation of the letter, the spacing and so on, but the pictorial effect, length and everything and that is the reason I say this is a mental assimilation. The party who writes a signature from memory doesn't know all the characteristics in the man's signature. That is where he is going to fall down. He does not carry in his memory the length of the signature. He merely has a mental picture of that signature in his mind. Now in order to make even a reasonable reproduction the writer would doubtless have to study this signature as to the formation of each letter, the lines, slant, connecting *Page 96
lines, the length and everything which goes to make up the signature. Whoever wrote this signature didn't have that memory in his mind; otherwise he would have a better image of Arnold's signature than that is. * * *
"I do not know how anybody else would do. I know what I would do. If you handed me the signature of my wife, and I have seen her write her name hundreds of times, I would positively refuse to say whether it is or is not her signature unless I had standards of her signature. I am an expert on handwriting but I am not an expert on her signature. I have seen it frequently but I couldn't say, from just looking at a signature whether it is hers. I have not a mental picture of the size she writes."
The foregoing is perhaps sufficiently illustrative of the character of the expert evidence thus relied on by the defendant. It will be observed that much of it is not evidence at all, either expert or nonexpert. It is mere hypothesis. If it be true that this witness is unable to verify the signature of his own wife, without the aid of expert facilities, then he has lost something which non-experts still retain. There are yet husbands who are still able to recognize to a practical certainty the signatures of their wives without resort to the aid of measure or microscope. This evidence serves little function here other than to attach uncertainty to all signatures and to all methods of proof thereof, and especially to those methods which have been deemed hitherto as most usual and reliable. The courts must still give credence to the testimony of a husband who thinks he knows the signature of his wife and who will swear to it without mental reservation. Furthermore, the declaration of this witness to the effect that he himself could reproduce the signature of this defendant so successfully as to defy any expert to distinguish between the true and the false, — seems to run counter to the very purpose for which the witness has been called. This challenge amounts to saying that the genuineness of a signature is unprovable either by expert or nonexpert. If this witness can simulate a signature so skillfully that no expert can detect its falsity, then the power to deceive has become more skillful than the power to detect. If this witness can, we must assume that others can. The evidence of this witness might have proved more
if he could have testified to a little less. The witness has put himself somewhat into this position: As a nonexpert he disclaims the ability to verify the signature of his own *Page 97
wife; as an expert he challenges the expert world to detect the falsity of a signature which he shall have simulated.
Nor are we able to find assistance in the declaration of this witness that the alleged forgery involved herein is to be classified as "mental assimilated forgery". If this be a forgery, we are not interested in its classification. Any kind would be a complete defense. In order to classify the forgery, the witness assumes its existence. That is a hypothesis only. If classification were the objective, the hypothesis would be understandable. But the sole objective here is to ascertain, not classification of an assumed forgery, but the absence of forgery. Is the signature genuine? If yea, there is nothing to classify. If nay, the classification is immaterial.
From any point of view we do not think that the foregoing expert evidence has afforded to the defendant any substantial aid. If "mental assimilated forgery" be a real thing, within the concept of the expert, it should be within the power of the expert to translate it into the mind of juror or judge. This has not been done in this record.
After a very careful study of the evidence in this record, expert and nonexpert, we have become firmly convinced of the genuineness of the signature under consideration. We are not insensitive to the great hardship of the case upon the defendant. We think that some of the nonexpert opinions should be accounted for on that score. Friends have sympathized deeply, and their opinions have doubtless been influenced to some extent by their sympathy. We know of no other way to account charitably for some of the nonexpert opinions in the evidence.
The judgment of the district court is accordingly affirmed.
CLAUSSEN, C.J., and KINDIG, ALBERT, and DONEGAN, JJ., concur.
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Plaintiff brought this action to recover damages alleged to have been caused by the negligent parking of defendant's truck on a public highway. The trial court sustained *Page 1145
plaintiff's motion to strike division one of the answer which reads:
"1. That the plaintiff, at the time and place of the accident complained of by him, was operating a motor vehicle upon a highway in the State of Iowa without a valid license as an operator or chauffeur, and was not a person exempted from having a license; that the accident happened while he was so operating said motor vehicle without a license, and as a result thereof, he is not entitled to recover damages from the defendant."
Section 5013.01, chapter 251.1, 1939 Code, reads:
"5013.01 Operators and chauffeurs licensed. No person, except those hereinafter expressly exempted shall drive any motor vehicle upon a highway in this state unless such person has a valid license as an operator or chauffeur issued by the department of public safety. No person shall operate a motor vehicle as a chauffeur unless he holds a valid chauffeur's license."
Section 5036.01, chapter 251.1, 1939 Code, reads:
"5036.01 Penalties for misdemeanor. It is a misdemeanor for any person to do any act forbidden or to fail to perform any act required by any of the provisions of this chapter unless any such violation is by this chapter [251.1] or other law of this state declared to be a felony. Chapter 180 shall have no application in the prosecution of offenses committed in violation of this chapter.
"Every person convicted of a misdemeanor for a violation of any of the provisions of this chapter for which another penalty is not provided shall be punished by a fine of not more than one hundred dollars or by imprisonment for not more than thirty days."
There is no statutory provision as to civil liability for violation of the provisions of chapter 251.1.
The question before us on this appeal is:
"May a plaintiff who is required to have a license to operate a motor vehicle upon the public highways of Iowa as provided *Page 1146
by section 5013.01 of the 1939 Code maintain an action in Iowa to recover damages sustained by him while he was operating a motor vehicle upon the Public Highway in Iowa without such license?"
The general rule, the rule established by the great weight of authority, is that the mere fact that the operator of a motor vehicle does not have a license or the fact that the motor vehicle is unregistered will not bar a recovery for injuries sustained to his person or property through the negligence of another unless there is a causal relation between his failure to comply with the law and the resulting injuries. 5 Am. Jur. 585, section 139; 5 Am. Jur. 586, section 141; 42 C.J. 724, section 188; 42 C.J. 748, section 234, and cases cited; Annotations, 16 A.L.R. 1108; 35 A.L.R. 62, 65; 87 A.L.R. 1469; Faust v. East Prairie Milling Co., (Mo.App.), 20 S.W.2d 918; White v. Kline,119 Wash. 45, 204 P. 796; Aycock v. Peaslee Gaulbert Paint
Varnish Co., 60 Ga. App. 897, 5 S.E.2d 598; Tipton v. Estill Ice Co., 279 Ky. 793, 132 S.W.2d 347; Speight v. Simonsen, 115 Or. 618,239 P. 542, 43 A.L.R. 1149.
This court has recognized and followed the above rule in several cases, among which are: Schuster v. Gillispie, 217 Iowa 386,251 N.W. 735; Wolford v. City of Grinnell, 179 Iowa 689,161 N.W. 686; Phipps v. City of Perry, 178 Iowa 173, 159 N.W. 653; Lockridge v. Minneapolis St. L. Ry. Co., 161 Iowa 74,140 N.W. 834, Ann. Cas. 1916A, 158.
In Schuster v. Gillispie, supra, the defendant appellant contended that the fact that the driver of the car in which plaintiff was riding did not have a driver's license, as required by law, prevented a recovery on the part of plaintiff. In rejecting this contention, the court stated [page 390 of217 Iowa, page 737 of 251 N.W.]:
"Appellant insists that this prevents recovery on the part of plaintiff. Appellant suggests no causal relationship between plaintiff's injuries and the fact that the driver of the car had no license and we are unable to discover any such relationship. Before a violation of a statute will preclude recovery, causal relationship must exist between the unlawful act and the injuries complained of." *Page 1147
In Wolford v. City of Grinnell, supra, the court, in considering a defense that plaintiff was violating the law in driving his car without having it registered, said [page 693 of179 Iowa, page 688 of 161 N.W.]:
"As to the last proposition, it is clear that plaintiff's failure to register the car had nothing whatever to do with the accident; that there is no showing of any causal connection between plaintiff's violation of law and the accident; hence his violation of the law was no defense to the action. No authorities need be cited in support of this proposition; but we may properly refer in this connection to Lockridge v. Minneapolis St. L.R. Co., 161 Iowa 74.
"The law as originally announced in Massachusetts, and perhaps some other states, has never been recognized in this jurisdiction."
To sustain defendant's position on the issue before us, we would be compelled to hold that operating a motor vehicle on a highway makes the operator a trespasser and constitutes a nuisance which precludes recovery; that the omission of his statutory duty by the operator constitutes a causal connection with his injuries. In support of defendant's view of the law, it cites Johnson v. Boston Maine R. Co., 83 N.H. 350, 143 A. 516,61 A.L.R. 1178, which holds that a failure of the operator of a motor vehicle to have a license is causal and bars a recovery. In Massachusetts this rule is applied where the motor vehicle is unregistered.
The law in New Hampshire and Massachusetts is in conflict with the general rule above stated. With reference to the minority rule and the Massachusetts rule, see 5 Am. Jur. 585, 586; Bacon v. Boston Elevated R. Co., 256 Mass. 30, 152 N.E. 35, 47 A.L.R. 1100; Bourne v. Whitman, 209 Mass. 155, 95 N.E. 404, 35 L.R.A., N.S., 701; Griffin v. Hustis, 234 Mass. 95, 125 N.E. 387, and Johnson v. Boston Maine R. Co., supra.
Because the challenged portion of the answer did not show a causal relation between the failure of plaintiff to have a license and the injuries complained of, the court was right in sustaining the motion to strike. — Affirmed.
CHIEF JUSTICE and all JUSTICES concur. *Page 1148
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I. It appears from the petition that the plaintiff is an "educational institution," within the meaning of that statute which pertains to the taxation of real estate and to exemptions therefrom. Its petition is in two counts. In the first count it avers that it is the owner of certain real estate acquired by it on January 11, 1924; that such real estate was exempt from taxation, under Section 6944, Code of 1924; that, on September 8, 1924, the board of supervisors of Henry County levied a tax thereon, without authority or right so to do; that the defendant has advertised said property for sale at tax sale because of failure of plaintiff to pay the tax, and intends to sell the same. Injunction is prayed.
Section 6944 enumerates in 21 paragraphs property which is exempt from taxation. Paragraph 11 of such enumeration is as follows:
"11. Property of educational institutions. Real estate owned by any educational institution of this state as a part of its endowment fund, to the extent of one hundred sixty acres in any civil township."
The property in question is a town lot, and is located within the township of Mt. Pleasant, in Henry County. The plaintiff avers that its real property in said township is less than 160 acres. Its averments bring it within the terms of Section 6944.
We are not advised of the specific ground upon which the demurrer was predicated or sustained. Appellee has filed no *Page 1240
argument here. We surmise the seat of trouble to be in the fact that the property had been assessed as against plaintiff's grantor on January 1, 1924, and that the levy of September 8, 1924, was made pursuant to such assessment. If we are correct in this surmise, then the question arising is whether such prior assessment to the then owner is operative to defeat the exemption of the plaintiff, to which it would otherwise be entitled. The assessment did not create a tax, nor did it create a lien upon the real estate. The plaintiff took a warranty deed for the property on January 11th, and duly filed the same for record. Surely the assessment did not operate as a breach of the grantor's covenant of warranty. If the plaintiff had paid the tax later levied, it could not have recovered the same from its grantor, as for breach of warranty. If, therefore, the taxes so levied on September 8th be valid and payable, they are so valid and payable as against the plaintiff, and as against no one else. The question then is, When did the exemption statute become operative in favor of the plaintiff? We can conceive of no reason why it should not be deemed operative from the date of acquisition of the property and the filing of its deed for record. The property was that of the plaintiff, an "educational institution," on September 8th. In levying the tax, therefore, the supervisors acted in violation of Section 6944. Its levy was illegal. If plaintiff had known of such levy at the time, it could properly and successfully have resisted the same. It has an equal right to resist the collection thereof. It is entitled, therefore, to a quieting of its title and to a perpetual injunction, as prayed.
II. The second count in the petition describes another town lot in the same township, which was acquired by the plaintiff on July 31st, by warranty deed duly filed for record. What we have already said is likewise applicable to this count.
The decree of the district court must, accordingly, be —Reversed.
ALBERT, C.J., and FAVILLE, KINDIG, and GRIMM, JJ., concur. *Page 1241
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Plaintiff was the owner of four motor trucks (equipped with pneumatic tires), which he used in the business of transporting freight, under the name of the "Sioux City Motor Express." His headquarters were in Sioux City, and, as we understand it, his place of operation was in Woodbury County and adjoining territory. These trucks had a manufacturer's rated loading capacity of two and one-half tons each, but plaintiff alleges that he regularly hauled from five- to seven-ton loads upon each of said trucks. He paid the fees for each of said trucks provided in Section 4913, Code, 1927 (which will be hereinafter set out), for the year commencing January 1, 1929.
The forty-third general assembly passed Senate File 199, which became Chapter 131 of the Acts of the Forty-third General Assembly, which will also be hereinafter set out. It became effective by publication May 3, 1929.
Plaintiff alleges that, under this latter act, defendants are seeking to compel him to pay an additional fee, and it is against this additional fee that he is complaining, on the ground that *Page 614
the law is unconstitutional, on various grounds, to which reference will hereinafter be made.
Chapter 131 of the Acts of the Forty-third General Assembly reads as follows:
"Sec. 1. The owner of any motor truck or trailer may secure a license therefor at a higher rated loading capacity than that specified by the manufacturer or maker, by the payment of the fee required therefor; and upon such application such owner shall be entitled to credit against such higher fee for the amount, if any, already paid as a license fee for such vehicle for the then current year.
"Sec. 2. It shall be unlawful to operate upon the public highways of this state any motor truck or trailer carrying a load more than twenty-five per cent in excess of the rated loading capacity on which the license fee paid on said vehicle is based. Any person owning or operating a motor truck or trailer in violation of the provisions of this section shall be guilty of a misdemeanor, and upon conviction thereof, shall be fined not less than twenty-five ($25.00) dollars and not more than one hundred ($100.00) dollars and upon the third conviction of violation of this act by the owner or operator of such vehicle, the license on such vehicle may be revoked by the motor vehicle department. In that event the number plates and certificate of registration of such vehicle shall be returned to the county treasurer issuing the same. The motor vehicle department, or any of its agents, or any peace officer of the state, shall have authority to enforce provisions of this section."
To a fair understanding of the plaintiff's contention, we also set out in full Sections 4913 and 4916, Code, 1927.
"4913. Trucks with pneumatic tires. For motor trucks equipped with all pneumatic tires, the annual license fee shall be:
"For 1 ton or less capacity, $15.00 per annum " 1 1/2 " capacity, 25.00 " " " 2 " " 40.00 " " " 2 1/2 " " 65.00 " " " 3 " " 100.00 " " " 3 1/2 " " 130.00 " " *Page 615
For 4 ton capacity, 160.00 per annum " 4 1/2 " " 200.00 " " " 5 " " 250.00 " " " 6 " " 300.00 " "
"4916. Trucks exceeding six-ton capacity. The license fee for trucks for each ton of load capacity above six tons shall be fifty dollars in addition to the six-ton rate."
It is also claimed by the plaintiff, and conceded by the defendants, through their motion, that the word "capacity," used in Section 4913 has been construed by the executive department and is treated by all parties hereto as meaning the "manufacturer's rated loading capacity." In other words, the plaintiff's motor trucks are rated by the manufacturer at a loading capacity of two and one-half tons, and the state has construed the word "capacity" used in said Section 4913 as meaning the manufacturer's rated loading capacity, and collected taxes on the basis of such rating.
This being an action in equity, defendants filed a motion to dismiss, which was overruled by the district court; hence this appeal.
The first question called to our attention is the claim on the part of the defendants that this is an effort to enjoin the administration of criminal law in the state of 1. INJUNCTION: Iowa, and hence not maintainable. There is subjects of nothing in this contention, as the right to protection maintain this action is fully established by and relief: this court in Bear v. City of Cedar Rapids, 147 alleged Iowa 341, l.c. 351; Huston v. City of Des
unconstitu- Moines, 176 Iowa 455, 464. tional tax accompanied by penal provision: injunction to test.
It is further urged that the action is not maintainable because 2. ACTIONS: the plaintiff has a speedy and adequate remedy nature and at law. This is not a tenable objection; for, if form: error the action is in the wrong forum, the relief, as to form: under the statute, is by motion to transfer to exclusive the proper forum, and not by motion to dismiss. procedure. Dilenbeck v. Security Sav. Bank, 186 Iowa 308.
It will be noted that the force and effect of the later enactment are somewhat confusing, in this: The title to the act indicates that the purpose of the legislature was to change its *Page 616
method of computation of fees, and instead of 3. AUTOMO- taking the manufacturer's rated loading capacity BILES: as a basis, the fees are to be fixed upon the public actual weight of the load carried; while, under service the original law, the weight of the load carried vehicles: was not an element in the fixing of the fee. If license fee the owner had a motor truck with a specified as manufacturer's rated loading capacity of two and non-property one-half tons, he paid a fee on that basis, but tax. the manufacturer's rated loading capacity in no way limited him as to the actual weight of the load carried. The later law provides that, if the truck carries more weight than the manufacturer's rated capacity, he must pay an additional fee therefor; or, concretely, prior to the 3d day of May, 1929, the plaintiff would pay on these motor trucks a fee of $65 for each truck, while, under the new enactment, he would pay a fee of $300 on each truck. It is as against this additional fee of $235 that he complains, and alleges that the law which creates this additional fee is unconstitutional.
The first ground on which this law is assaulted is based on Article 7, Section 7, of the Constitution of Iowa, reading as follows:
"Every law which imposes, continues, or revives a tax, shall distinctly state the tax, and the object to which it is to be applied; and it shall not be sufficient to refer to any other law to fix such tax or object."
A reference to said section of the Acts of the Forty-third General Assembly makes it patent that this section of the Constitution, if applicable, has in no way been complied with. The question, therefore, for determination at this point is whether or not this additional fee provided for is a "tax," within the meaning of this section of the Constitution.
Among the many powers possessed by the state there are two inherent powers with which we are concerned: one, known as the power of taxation; the other, as the police power. The police power in matters of this kind is usually exercised by way of a license. State v. Herod, 29 Iowa 123; City of Des Moines v.Manhattan Oil Co., 193 Iowa 1096; City of Des Moines v. Bolton,128 Iowa 108; State v. Manhattan Oil Co., 199 Iowa 1213. *Page 617
Much confusion will be found in the decisions from careless use of language and terms, such as "license fee," "license tax," "privilege tax," "occupation tax," "permit," and "regulation fees," which are indiscriminately used; yet the word "license" has a definite and distinct meaning. In 2 Bouvier's Law Dictionary 1976 it is defined as "authority to do some act or carry on some trade or business in its nature lawful, but prohibited by statute, except with the permission of the civil authority, or which would otherwise be unlawful." See, also,LaPlante v. State Board of Public Roads, 47 R.I. 258
(131 A. 641).
Another distinction that is to be kept in mind is that the state possesses complete police power, whereas a municipality is usually limited to the exercise of such police power as is granted to it by the state; hence, among the many cases, much is said in cases where the municipal corporation is attempting to exercise its limited police power, that is not applicable where the state is attempting to exercise its police power.
It is the general rule that, where the charge for the license is imposed in the exercise of the police power, the amount which may be exacted may include and must be limited and measured by the necessary or probable expense of issuing the license, and such inspection, regulation, and supervision as may be provided for in the act and may be lawful and necessary. State v.Manhattan Oil Co., 199 Iowa 1213; State v. Osborne, 171 Iowa 678;Keckevoet v. City of Dubuque, 158 Iowa 631.
That there is a very definite distinction existing between a license fee when imposed under the police power and a tax imposed for revenue under the power of taxation is evidenced by the following cases: State v. Herod, 29 Iowa 123; City of Des Moinesv. Bolton, 128 Iowa 108; City of Ottumwa v. Zekind, 95 Iowa 622; 37 Corpus Juris 169, and notes.
Where the amount imposed is substantially in excess of and out of proportion to the expense incurred, it is generally regarded as a revenue measure. State v. Osborne, 171 Iowa 678; City ofOttumwa v. Zekind, 95 Iowa 622. This is particularly so where no provision for inspection or regulation is made by the act.Waters-Pierce Oil Co. v. Hot Springs, 85 Ark. 509 (109 S.W. 293);State v. Moore, 113 N.C. 697 (18 S.E. 342); Densmore v. ErieCity, 7 Pa. Dist. 355. It is also a well settled rule that *Page 618
the terminology used in the act is in no way controlling in determining this question as to whether it is a license or a tax.State v. Osborne, 171 Iowa 678; Keckevoet v. City of Dubuque,158 Iowa 631; Star Trans. Co. v. City of Mason City, 195 Iowa 930, l.c. 956; 37 Corpus Juris 170.
With these general rules in mind, we are to determine what the intent of the legislature was in the passage of this last act. Was its intent simply to put a license charge on these trucks, or was its intent to raise revenue thereby? In reaching a conclusion on this question, it may be well to review somewhat the legislation on the subject.
The first enactment in this state was in the year 1904, which required registration with the secretary of state, who issued a certificate, the charge therefor being $1.00 for each car. No one would question that this was a license fee, pure and simple, under the police power of the state. In 1909, this fee was increased to $5.00. In 1911, the whole system was changed, and a fee of $8.00 was placed upon every motor vehicle of 20 horse power or less, and for over that horse power, a rate of 40 cents per horse power was added. It was also provided in this act that the registration fee imposed "shall be in lieu of all taxes, general or local, to which motor vehicles may be subject." Motor trucks were excepted from this act, as were motor drays and motor delivery wagons. A registration fee was charged to all dealers in automobiles. This act also provided for an apportionment of these fees among the different townships and counties, for the improvement of the public highways outside of the limits of cities and towns. See Acts of the Thirty-fourth General Assembly, Chapter 72. This law by its operation produced fees in the amount of $485,300 in the year 1912.
The thirty-eighth general assembly (Chapter 275, Acts of the Thirty-eighth General Assembly) provided for a fee on all motor trucks equipped with pneumatic tires of two and one-half tons capacity, of $45, and gradually increased to $165 for six tons; also provided that these registration fees were in lieu of all taxes, general or local, to which motor vehicles were subject. This fee continued in operation until the adoption of the Code of 1927, where the fees were increased, as shown by Section 4913 heretofore set out.
The thirty-fifth general assembly, by Chapter 122, Acts of *Page 619
the Thirty-fifth General Assembly, established the state highway commission, in 1913, and aside from a small percentage of the moneys collected under these laws, which were turned over to the state, to compensate it for its trouble in issuing the licenses and collecting the fees, all of the moneys thus collected are expended under the supervision of the highway commission in the construction and improvement of the highways of the state. The total receipt of fees under these various laws for the year 1929 was approximately $12,000,000.
This court is not dumb, and has a right to consider that which everyone knows, to wit: that, about the year 1911, the use of automobiles was increasing rapidly in this state, and there came a very urgent and pressing demand for the improvement of the highways, and the burning question was to find a means to meet the demand.
In the light of these rules of law and circumstances, can any other logical conclusion be reached than that this measure was never intended as a license measure, in the true sense, but that these various laws were passed and intended for one sole purpose: that was, to raise money with which to build and improve and hard-surface the highways of the state? It was not intended in the narrow sense of an exercise of the police power, for the purpose of regulating by licenses. Many other states have had this same proposition before them, and have held that a law similar to this is not a license law, but a tax law. State exrel. McClung v. Becker, 288 Mo. 607 (233 S.W. 54); Saviers v.Smith, 101 Ohio St. 132 (128 N.E. 269); State v. Caplan, 100 Vt. 140
(135 A. 705); Opinion of the Justices, 250 Mass. 591
(148 N.E. 889, 894); Fisher Bros. Co. v. Brown, 111 Ohio St. 602
(146 N.E. 100, 106); Vernor v. Secretary of State, 179 Mich. 157
(146 N.W. 338).
Aside from this view, it is a well established principle in cases of this kind that the legislature may exercise both the police and the taxing power in one act. See State v. Gish,168 Iowa 70; In re Application of Smith, 26 Cal.App. 116
(146 P. 82); Smallwood v. Jeter, 42 Ida. 169 (244 P. 149); State exrel. McClung v. Becket, 288 Mo. 607 (233 S.W. 54); Ex rel.Ginocchio v. Shaughnessy, 47 Nev. 129 (217 P. 581); State v.Ingalls, 18 N.M. 211 (135 P. 1177); Saviers v. Smith, 101 Ohio St. 132
(128 N.E. 269); State v. Preston, 103 Or. 631 *Page 620
(206 P. 304); Bleon v. Emery, 60 Utah 582 (209 P. 627); State v.Caplan, 100 Vt. 140 (135 A. 705); Jasnowski v. Board ofAssessors, 191 Mich. 287 (157 N.W. 891); Kane v. State of NewJersey, 242 U.S. 160 (61 L. Ed. 222); Gundling v. Chicago,177 U.S. 183 (44 L. Ed. 725).
While the writer and several other members of the court are in favor of holding that this charge is a "tax," the majority is in favor of leaving this question undecided. Therefore we shall assume, without deciding, that the charge provided in the statute arises from the exercise of the taxing power, and not the police power. Having thus assumed, for the purposes of this case, that the fees charged herein are "taxes," we then are face to face with the original proposition stated in the beginning of this opinion: to wit, are they taxes within the meaning of Article VII, Section 7, of the state Constitution?
In the case of Scottish Union and Nat. Ins. Co. v. Herriott,109 Iowa 606, we had a statute (Code, 1897, Section 1333) requiring all insurance companies to pay to the state a certain percentage of the premiums received on business done within the state, as a condition of their doing business within its limits. We held that this was a tax on business, and not on property; hence, that it did not violate Article VIII, Section 2, of the Constitution, providing that property of a corporation shall be subject to taxation the same as that of individuals.
In the case of State v. Edmunds, 127 Iowa 333, we had before us the discussion of a license tax on physicians. While the case held that the title to the act sufficiently complied with Article VII, Section 7, of the Constitution, we further said:
"Aside from this, however, it may well be doubted whether this provision of the Constitution applies to license taxes such as were here exacted" (citing Howland v. City of Chicago, 108 III. 496; Braun v. City of Chicago, 110 Ill. 186; City of Leavenworthv. Booth, 15 Kan. 627; Scottish Union and Nat. Ins. Co. v.Herriott, 109 Iowa 606).
In Iowa Mut. Tor. Ins. Assn. v. Gilbertson, 129 Iowa 658, we again reiterated the pronouncement in the Herriott case, supra, in an assault made against the act then under consideration that the law was not uniform in its operation; that it granted special privileges to some, to the exclusion of others; and that *Page 621
it offended against Section 2 of Article VIII of the Constitution. We then said:
"When it is once conceded, as it must be, that the tax is not a property one, the last objection is disposed of; so that we shall give this question no further attention."
The Constitutions of different states provide either for uniformity or equality of taxation, and some provide against double taxation. The suggestion made in the above-cited Iowa cases is that constitutional provisions of this kind apply to property taxes, and not to the kind of taxes we have under consideration in the present case. This has been the unbroken line of authority, as is shown by the following list of cases:State v. Collins, 94 Wn. 310 (162 P. 556); Ruggles v. State,120 Md. 553 (87 A. 1080); In re Application of Kessler,26 Ida. 764 (146 P. 113); In re Application of Schuler, 167 Cal. 282
(139 P. 685); Harder's Fire Proof S. V. Co. v. City ofChicago, 235 Ill. 58 (85 N.E. 245); State v. Ingalls, 18 N.M. 211
(135 P. 1177); Kane v. State, 81 N.J. Law 594 (80 A. 453); Inre Hoffert, 34 S.D. 271 (148 N.W. 20); Smallwood v. Jeter,42 Ida. 169 (244 P. 149); State ex rel. McClung v. Becker,288 Mo. 607 (233 S.W. 54); Fisher Bros. Co. v. Brown, 111 Ohio St. 602
(146 N.E. 100); Saviers v. Smith, 101 Ohio St. 132
(128 N.E. 269); Lee v. State, 163 Ga. 239 (135 S.E. 912); Whaley v.Northern Road Impr. Dist., 152 Ark. 573 (240 S.W. 1); Lillard v.Melton, 103 S.C. 10 (87 S.E. 421); State v. Caplan, 100 Vt. 140
(135 A. 705); Atkins v. State Highway Department
(Tex.Civ.App.), 201 S.W. 226; 1 Berry on the Law of Automobiles (6th Ed.) 102-105; 19 Ruling Case Law 19, Section 11; 5 A.L.R. 732; Braunv. City of Chicago, 110 Ill. 186.
It is quite evident that the charge herein is a charge for the privilege of using the streets and highways as a place of business. The highways belong to the public for ordinary use and general traffic, and they are free and common to all. Such use, however, is a mere privilege, and not an inherent or natural right. Huston v. City of Des Moines, 176 Iowa 455, at 477;Melconian v. City of Grand Rapids, 218 Mich. 397 (188 N.W. 521,524); Memphis St. R. Co. v. Rapid Transit Co., 133 Tenn. 99
(179 S.W. 635); Desser v. City of Wichita, 96 Kan. 820
(153 P. 1194); Greene v. City of San Antonio (Tex.Civ.App.), *Page 622
178 S.W. 6; Hadfield v. Lundin, 98 Wn. 657 (168 P. 516); ExParte Dickey, 76 W. Va. 576 (85 S.E. 781); In re Hoffert, 34 S.D. 271
(52 L.R.A. [N.S.] 949).
Such right to the use of the public highways is not absolute and unqualified, but is subject to the limitation or control of the legislature. While these are the general rights of the public on the highways, they do not carry with them a right to use the public highways as a place of business. Greene v. City of SanAntonio (Tex.Civ.App.), 178 S.W. 6; Hadfield v. Lundin,98 Wn. 657 (168 P. 516); Le Blanc v. City of New Orleans,138 La. 243 (70 So. 212); Ex Parte Dickey, 76 W. Va. 576
(85 S.E. 781); Desser v. City of Wichita, 96 Kan. 820 (153 P. 1194);Melconian v. City of Grand Rapids, 218 Mich. 397 (188 N.W. 521). The right to make such charges under these circumstances for the use of the public highways has been affirmed in the following cases: Kane v. State of New Jersey, 242 U.S. 160 (61 L. Ed. 222);Hendrick v. State of Maryland, 235 U.S. 610 (59 L. Ed. 385);Bekins Van Lines v. Riley, 280 U.S. 80 (74 L. Ed. 178); Smith v.Commonwealth, 175 Ky. 286 (194 S.W. 367); Jackson v. Neff,64 Fla. 326 (60 So. 350); Bozeman v. State, 7 Ala. App. 151
(61 So. 604); State v. Ingalls, 18 N.M. 211 (135 P. 1177); 1 Berry on the Law of Automobiles (6th Ed.) 115, 116.
Aside from what has been said heretofore, it is a well-known fact that the state has improved its roads at a large expenditure of money, and is now engaged in creating a net work of hard-surfaced or paved roads within the state. It is also true that the heavier the load carried on these hard-surfaced roads, the more damage and destruction thereto. This necessitates improvements, and an increase in the cost of maintenance; and it is no more than right and just that those who contribute to the necessity of construction and maintenance of such roads should pay, or help to pay, the cost of such increased expense in the maintenance thereof. Kane v. State of New Jersey, 242 U.S. 160
(61 L. Ed. 222), affirming 81 N.J. Law 594 (80 A. 453); Lee v.State, 163 Ga. 239 (135 S.E. 912); State v. Collins, 94 Wn. 310
(162 P. 556); Smallwood v. Jeter, 42 Ida. 169 (244 P. 149);State v. Caplan, 100 Vt. 140 (135 A. 705); Opinion of theJustices, 250 Mass. 591 (148 N.E. 889); In re Hoffert, 34 S.D. 271
(148 N.W. 20); Saviers v. Smith, 101 Ohio St. 132 *Page 623
(128 N.E. 269); Camas Stage Co. v. Kozer, 104 Or. 600
(209 P. 95).
It may be noted that in State v. Caplan, 100 Vt. 140
(135 A. 705), the Vermont court had before it the question of a motor-bus law, which provided, among other things, for a fee to be paid. That court held the fee to be a tax, but in the closing paragraph said:
"It may be true that in some of the foregoing cases the right under discussion is assigned to the police power, rather than to the taxing power. But in our view, this makes no difference in the result. You may call the charge imposed a `fee,' or you may call it a `tax;' you may call the enactment imposing it a `police measure,' or you may call it a `revenue measure;' it makes no difference. The validity of the act in the respects here called in question is established."
In Iowa Motor Vehicle Assn. v. Board of Railroad Com., 207 Iowa 461, we had under consideration a very similar statute to this, in which a tax was made, very like the one in the present case. In concluding that opinion we said:
"In the instant case, the law is based upon the actual manner of operation, and there can be no doubt that, where a state, at its own expense, furnishes special facilities for the use of those engaged in commerce, it may exact compensation therefor. It has the right to say, if it pleases, that no person or corporation shall use its public highways as a transportation line for hire. The right of a citizen to travel upon the highway and transport his property thereon in the ordinary course of living and business is radically different from that of one who makes a certain portion of the highway his place of business, and uses it for private gain in the transportation of freight or passengers, as under the terms of the statute in question."
Our conclusion is that, while the charges made herein are considered as a tax, they are not a property tax, and therefore do not violate Article VII of Section 7 of the Constitution.
Another question raised here is that Chapter 131 of the Acts of the Forty-third General Assembly is in fact an amendment *Page 624
4. STATUTES: or revision of Section 4913, Code, 1927. We construction think this assertion of the appellee's is and correct; but he claims that Chapter 131 should operation: be held invalid, because of Section 47, in form of Chapter 3, of the Code, 1927, which reads as bills: follows: directory statute.
"Form of Bills. Bills designed to amend, revise, codify, or repeal a law:
"1. Shall refer to the number of the section or sections of the Code to be amended.
"2. Shall refer to the number of the chapter or chapters and title of the Code to be amended.
"3. Shall refer to the number of the general assembly and of the sections and chapters of the acts thereof to be amended in case the bill relates to a section or sections of an act not appearing in the Code.
"4. All references shall be expressed in words, followed by the numerals in parentheses, and if omitted the reporter of the supreme court in preparing acts for publication in the session laws shall supply the same."
With the latter proposition we cannot agree. The general rule is too well settled to need citation of authority that each legislature is an independent body, entitled to exercise all legislative power under the limitation of the Constitution of this state and the United States, and no legislature can pass a law which would be binding on subsequent legislatures. We think this rule applies to the situation before us. In other words, Section 47 of the Code was utterly disregarded by the legislature; yet this act cannot be held invalid because thereof. Authorities on this proposition are not numerous, but those we have been able to find announce this doctrine. See Maigault v.S.M. Ward Co., 123 Fed. 707; Cook v. State, 26 Ind. App. 278
(59 N.E. 489); State, Use Rathbone, v. County Court of WirtCounty, 37 W. Va. 808 (17 S.E. 379).
We are treating this case, as do counsel in their briefs and arguments, on the theory that the plaintiff is using these trucks on the highways of the state as a common carrier. The district court having held to the contrary, it erred in its decision. —Reversed.
All the justices concur. *Page 625
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The record does not disclose why the cause was transferred from the law to the equity side of the calendar. The demand for an accounting is not exclusively cognizable in equity. Originally, matters of account which were proper for an 1. TRIAL: action of account were cognizable exclusively at dockets: law; but the old common-law action of account action of was early assumed by courts of equity, and its "accoun- jurisdiction may, as a general rule, attach ting." whenever the subject-matter cannot be fully investigated at law. It is the general rule that, in order that an equity court may obtain jurisdiction of an accounting, three things concur: first, the need of a discovery; second, the complicated character of the accounts; and third, the existence of a fiduciary or trust relation. A court of equity will not withdraw the litigation from a law court unless it clearly appears that such a course is necessary, in order that complete justice may be done. See Mayo v. Halley, 124 Iowa 675; 1 Corpus Juris 612, Section 56 et seq.
The sole defense made in the case at bar is that Brown, as treasurer of the Fort Dodge Manufacturing Company, a corporation, received and paid out the insurance money to liquidate other notes and other indebtedness than the note sued on; that defendant is entitled to have an accounting from Brown and to have the insurance money spread over all indebtedness pro rata.
If the allegations of the answer were true, and such a claim constituted a defense, it would require a mere matter of computation to ascertain what amount, if any, defendant should pay. There is nothing in such a case requiring the interposition of equity. If, as appellee claims, the books and records are in the possession of plaintiff, the law provides an effective method of procuring the same for examination or copy. The exception taken to the order transferring the cause to equity is not argued, and therefore we give the proposition no further consideration.
The indebtedness for which the note in suit was given originated some three or four years prior to the year 1913, when the plant of the corporation was destroyed by fire. Brown and *Page 119
2. PRINCIPAL Conway jointly paid the interest on the note AND SURETY: when it was renewed, from time to time, up to remedies of the time of the fire. The note was renewed after surety: that, from time to time, until the fall of 1918, reimburse- when Conway refused to renew, although he and ment from Brown had paid the interest at each renewal cosurety: time. Thereafter, Brown paid the note and the unavailable accrued interest when the payee, the First defense. National Bank of Fort Dodge, threatened suit.
Conway claims that he is not liable to contribute to Brown, because Conway, as a stockholder of the corporation, which has never been dissolved, is entitled to an accounting from Brown, as its treasurer, for moneys received by the corporation from fire insurance. But the evidence shows that Brown was not treasurer, but president; that he had nothing to do with the use of any of the insurance money to pay claims; that he never received any money, except to apply on a note given to his wife by the corporation for money she had loaned it. The claim that Conway is entitled to an accounting from Brown, as treasurer, therefore fails. Nor is there any evidence in the record that Brown assumed and undertook to pay off any debts and ignored the one in suit, as is claimed by Conway in his answer.
But assume that Brown, as president of the corporation, did order the treasurer to pay notes and other debts of the company from the insurance money collected. Does this entitle Conway to complain and to receive from Brown an accounting of such of the corporation's funds as were so used? It must be borne in mind that this corporation has not been dissolved, nor has there been any action on the part of its board of directors declaring any of the funds of the corporation available to stockholders. No stockholder has any right to any of the money in the treasury of the corporation at any time until such a fund has been created, either by its officers or by operation of law. If such an action is to be maintained, — that is, an action of accounting for the funds of the corporation, — it must be maintained, if at all, by a suit for the benefit of the corporation, and not by a stockholder in his individual capacity. See Dillon v. Lee,110 Iowa 156; Kennedy v. Citizens' Nat. Bank, 128 Iowa 561; Schoeningv. Schwenk, 112 Iowa 733.
To say, therefore, that Conway is not liable for contribution *Page 120
to Brown because the treasurer of the company paid claims out of the corporation's treasury, ignoring the claim of Conway, is in fact saying that a part of the fire insurance money belonged to Conway, as a stockholder, and should have been paid upon his note, executed for the accommodation of the company. With this proposition we cannot agree.
For the purpose of this opinion, we may assume that the makers of this accommodation note are cosureties. The settled principle of law is that, when one of two cosureties takes indemnity from the principal, he is bound to account to his cosurety therefor. And in this case, if there was any evidence in the record that Brown had received any money from the treasury of the corporation, to be applied upon the note signed by himself and Conway, he would be required to account to Conway for one half of the amount so paid. See Security Sav. Bank v. Peddicord, 196 Iowa 215. The record, however, fails to show that Brown ever received from the treasury of the company, or from anyone else, any money that was to be applied to the payment of the note in suit.
We can see no merit in the defense interposed, nor can we, under the prayer for general equitable relief, sustain the action of the lower court. This cause, having been transferred to equity, and having been tried as such, is triable de novo here. The cause is therefore remanded, with instructions to enter judgment and decree in harmony with this opinion; or appellant may, if he so elects, have judgment entered in this court, as prayed in his petition. — Reversed.
STEVENS, FAVILLE, and VERMILION, JJ., concur.
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This is an original contempt proceeding against Norman Baker, in which he is cited to show cause why he should not be punished for contempt for violating a former decree of this court, enjoining him by himself, agents or employees from practicing medicine in this State. For a review of the historical background of the proceedings which culminated in the issuance of the injunction, reference is made to the case of State v. Baker,212 Iowa 571, 235 N.W. 313. Decree in the above cause was entered in this court on the 16th day of June, 1931, restraining and permanently enjoining the defendant, Norman Baker, from directly or indirectly, either by himself or by his agents, engaging in the practice of medicine and surgery within the State of Iowa without having a license to do so, and in conformance with said decree writ of permanent injunction was issued and served on the defendant on June 25, 1931.
On May 2, 1932, application was filed in this court charging a violation of said injunction by said defendant and asking that *Page 905
citation issue to show cause why he should not be punished for contempt, which citation was issued on the same day.
[1] Rule to show cause including substance of application and copy of citation was served on defendant to which he filed resistance. The matter was referred to District Court Judge John E. Purcell to conduct a hearing and report to this court. Hearing was had and report filed, the referee finding in his opinion defendant had violated the injunction by engaging in the practice of medicine since the issuance of said writ. Complaint is made that the referee made no rulings on objections to testimony. We think the referee pursued the proper course. We shall consider the evidence together with the objections, and base our opinion on such evidence only as we deem competent.
[2] It is also contended that the statutes of this State (chap. 536, Code of 1935 [section 12540 et seq.]), governing the procedure in contempt cases are unconstitutional, in that under the procedure provided by said statutes the defendant is deprived of liberty and property without due process of law. The matter has had our careful consideration and we find no merit in such contention. The power to proceed summarily without formal indictment and without a jury to hear charges of contempt of court and to assess punishment has been an attribute of all courts of record in every stage of the development of our system of judicial procedure. Jones v. Mould, 151 Iowa 599, 605, 132 N.W. 45. While contempt proceedings are quasi-criminal and partake in a certain sense or degree of a criminal offense, it is nevertheless neither a crime nor misdemeanor, and statutory and constitutional provisions relating to the rights and privileges of one charged with a crime are not all vouchsafed to the contemnor in contempt proceedings. State v. Hume, 193 Iowa 1395, 188 N.W. 796; Joyner v. Utterback, 198 Iowa 215, 197 N.W. 474; Hammer v. Utterback, 202 Iowa 50, 209 N.W. 522; Andreano v. Utterback, 202 Iowa 570, 210 N.W. 780; Barber v. Brennan,140 Iowa 678, 119 N.W. 142. The object and purpose of the proceedings is not to punish an offense, but to compel obedience to and respect for the order of the court. Gibson v. Hutchinson,148 Iowa 139, 126 N.W. 790, Ann. Cas. 1912B, 1007. No formal information is required. State v. Myers, 44 Iowa 580. The affidavit charging contempt may be general. McGlasson v. Scott,112 Iowa 289, 83 N.W. 974; Pumphrey v. Anderson, 141 Iowa 140, 119 N.W. 528; Koch v. District Court, 150 Iowa 151, *Page 906
129 N.W. 740; Jones v. Byington, 128 Iowa 397, 104 N.W. 473. The application and rule to show cause were sufficient and the due process clause of the Federal Constitution was not invaded.
[3] Complaint is made to the action of the referee in permitting the introduction of testimony covering the entire period from the issuance of the writ to the date of the hearing. This was a continuing offense. Testimony all tended to show the defendant and those who operated the Baker Hospital under his direction under the guise of a formal lease or contract of sale were, in fact, all engaged in a common scheme and design to perpetrate a fraud upon the court, and that said lessees were, in fact, but the employees of the defendant or the Baker Investment Company, of which he was manager and, in fact, the real owner. Likewise, most of the evidence as to transactions since the date of the citation tended to show the method of conducting the business of the hospital and the treatment of patients therein at and prior to said date. We have eliminated from our consideration all evidence which does not bear on one or the other of the foregoing propositions. We find ample competent proof to sustain the referee's findings. The contention of defendant was that if the medical practice act (sections 2538, 2539, Code 1935), be so construed as to hold that the owner of the hospital did not have a right to employ licensed physicians to practice medicine and attend patients in the hospital, the same would be unconstitutional and violative of the 14th Amendment to the Federal Constitution. Courts have uniformly held that reasonable regulations are permissible under police power of the state as to occupations affecting public health and welfare. State v. Bailey Dental Co., 211 Iowa 781, 234 N.W. 260; Parker v. Board of Dental Examiners, 216 Cal. 285, 14 P.2d 67.
[4] Lastly it is contended the evidence is not sufficient to show that the defendant has since the issuance of said writ engaged in the practice of medicine in this State, as defined by our statute. It would serve no useful purpose to undertake an analysis of this large record within the proper compass of an opinion. We have given careful consideration to the entire record, to the several propositions urged by counsel, and there is no way that the evidence may be reconciled on any reasonable or rational basis except that this defendant and his accomplices and confederates in the operation of the Baker Hospital at Muscatine. Iowa, were engaged in perpetrating a stupendous fraud against *Page 907
the court. That the leases and contracts were but a cunning subterfuge. We cannot shut our eyes to such transparent trickery. A court so supine as to overlook such conduct would merit the contempt of all fair-minded men. We approve the referee's report. We find the showing on the part of the defendant insufficient. The defendant is guilty of contempt of this court, in that he has through his employees and agents engaged in prescribing, and prescribing and furnishing medicine or remedies for human ailments, and in so doing has violated the injunction issued out of this court as charged. The punishment prescribed by statute is wholly inadequate. By section 12543, Code 1935, in "courts of record" the punishment, unless otherwise provided, is limited to a fine of $50.00 and imprisonment of one day. The power of the legislature to enact legislation regulating judicial procedure is contained in our Constitution, and this statute limiting punishment, has been upheld as the law of this State since 1851. Drady v. Given, 126 Iowa 345, 102 N.W. 115; Eicher v. Tinley,221 Iowa 293, 264 N.W. 591. It is, therefore, the judgment of this court that the defendant be confined in the county jail at Muscatine, Iowa, for one day and pay a fine of $50.00, and the costs of this proceeding; costs to be taxed by the clerk of this court, and judgment is hereby entered accordingly, and that execution issue to make the amount of such judgment, interest and costs, and in default of payment of said fine, the defendant be imprisoned in the county jail at Muscatine, Iowa, until said fine is paid not exceeding fifteen days, or one day for each $3.33 1/3 of said fine.
PARSONS, C.J., and DONEGAN, MITCHELL, STIGER, RICHARDS, and KINTZINGER, JJ., concur.
Special concurrence. — ALBERT and ANDERSON, JJ., concur in the opinion but would hold that the statute limiting the punishment has no application to contempt cases in this court and that the punishment imposed is inadequate. *Page 908
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A.D. Davis, who was a lawyer engaged in practice at Eldora, Iowa, died on the 17th day of October, 1928. Said Davis left a will in which his widow, Clara G. Davis, was named as executrix and which in due time was admitted to probate. On January 26, 1929, the claimant herein filed his claim in the district court of Hardin county, Iowa. This claim was later amended and as thus amended stated that about the month of November, 1920, A.D. Davis orally employed the claimant to do engineering and surveying work for him; that pursuant to said employment claimant did the matters and things as set out in his original claim, and that the fair and reasonable value of said services is as set out in the itemized statement incorporated in said claim.
The answer filed by defendant was in four divisions. Division one was a general denial. Division two alleged that the claimant did certain engineering work for clients of said Davis; that said Davis was not personally interested in any transactions with plaintiff, except as attorney; that said Davis never became personally liable to said claimant for engineering or surveying services; and that claimant knew that said Davis did not intend to become personally liable for such services. Division three alleged on information and belief that claimant had in some way been paid for the work for which claim is made. Division four alleged that certain of the items claimed by plaintiff were for separate and distinct services performed in connection with different drainage districts, that they were separate transactions and were not a part of an open running account, and that all items of plaintiff's claim down to and including an item of December 27, 1922, were barred by the statute of limitations.
Upon the trial of the case the claimant introduced evidence of witnesses other than himself tending to show his employment by the decedent, and also introduced in evidence five separate pages or sheets of what was claimed to be a loose-leaf system of accounting kept by him, and which are identified in the record as Exhibits A, B, C, C-1, D, and E. Exhibit A contains charges made by claimant for services performed in connection with drainage district No. *Page 511
55. Exhibit B contains charges made by claimant for services performed in connection with drainage district No. 121. Exhibits C and C-1 contain charges made for services performed in connection with drainage district No. 45. Exhibit D contains charges made for services performed in connection with drainage district No. 123. And Exhibit E contains a recapitulation of the balances due for services performed in connection with each of the above-named drainage districts, an original entry for services performed in connection with a special paving assessment against one B.C. Hurd, and also all credits allowed said A.D. Davis for sums paid, and shows a balance due of $592.15. The jury rendered a verdict for the full amount of the balance shown by said exhibit, in the sum of $592.15, and judgment was entered upon the verdict for said amount. Exceptions to instructions and a motion for new trial filed by the defendant were overruled by the court, and defendant appealed to this court.
Appellant sets out 22 errors which are relied upon for reversal. These alleged errors can be separated generally into those having to do with the rulings of the court in connection with the evidence, those having reference to the statute of limitations, those based on the statute of frauds, and those having reference to the instructions given to the jury.
[1] I. The errors which it is alleged occurred in connection with the rulings of the court upon evidence arose in connection with the Exhibits A, B, C, C-1, D, and E, which constituted the appellee's account, and the proof preliminary to the introduction of same. Such preliminary proof consisted of testimony by the claimant-appellee to the effect that he kept records on which he based his claim; that the records of the account were as shown by the exhibits and were in his own handwriting; that the entries were made in the course of his business; that they were made about the time designated; that they comprised all of his records in reference to the claim; that the items of charge and credit were true and correct; that the exhibits were true and correct statements of the matters and things they purported to show; that the witness was familiar with the fair and reasonable value of the services indicated by the exhibits; and that the items of charge set out in the exhibits represented the fair and reasonable value of the services rendered at the time and place therein referred to. To all of this preliminary proof and to the introduction of the exhibits themselves the defendant objected on the ground that the witness was incompetent under *Page 512
the Dead Man's Statute, because they all had reference to transactions between the claimant-witness and the deceased. All of defendant's objections to the evidence thus offered were overruled by the court, and the exhibits were allowed to be introduced in evidence.
The question of the introduction of books of account to establish a claim against a deceased person was considered by this court in the case of Dysart v. Furrow, 90 Iowa 59, 57 N.W. 644. In that case we said:
"An examination as to the facts required to be shown preliminary to the introduction of a book of account is not an examination in regard to personal transactions or communications between the witness and the deceased, within the meaning of said section 3639. To properly understand and apply that restriction to an examination of a witness, we must have in mind the reason for the statute. By section 3636, `every human being with sufficient capacity to understand the obligation of an oath is a competent witness in all cases both civil and criminal, except as herein otherwise declared.' The exceptions are not as to the competency of witnesses, but the restrictions that are placed upon their examination in said section 3639 and in section 3642 as to communications between husband and wife. Under said section 3636 all persons are competent witnesses, regardless of their relation to or interest in the action or proceeding. Each party may meet his adversary from the witness stand as well as in his pleadings, and admit or deny that which he has said as to personal transactions or communications between them. If the transaction or communication was personal, it must be known alike to both, and therefore either may admit or deny. When by death, insanity, or lunacy the lips of one party are closed, section 3639 wisely closes the mouth of his adversary as to personal transactions and communications which the silent party might from personal knowledge deny were he able to speak. Personal transactions and communications, as contemplated in the statute, are transactions and communications between the parties, of which both must have had personal knowledge. This defendant was a competent witness, and entitled to testify as to all material facts except as to such personal transactions and communications between him and the deceased. For him to testify that his book Exhibit A was his book of original entries, that the charges were made at or near the time of the transactions therein entered, and that he believed them to be just and true, would not be stating anything that the deceased, if *Page 513
living, could deny from personal knowledge. The deceased might, if living, deny that he received any one or all of the items charged, but this would be denying that which the book tends to show, and not any of the three preliminary facts which defendant was prevented from showing. Roche v. Ware, 71 Cal. 375, 12 P. 284 [60 Am. Rep. 539]; Snell v. Parsons, 59 N.H. 521. This book of account, when properly authenticated, was admissible in evidence, even against the estate of a deceased person. The statute expressly and without qualification permits the preliminary facts to be shown by the party's oath, and in so showing them he is not examined as to personal transactions between him and the deceased."
In testifying to the matters preliminary to the introduction of the exhibits comprising his account, the claimant was not testifying to any personal transaction with the deceased. His testimony had reference to the account itself and the items comprising it; that these items have reference to and represent services claimed to have been performed for the decedent does not make the testimony offered in reference to the account and its items such testimony in regard to transactions with the decedent as is barred by the statute. We find no error in the rulings of the court in connection with the introduction of the exhibits comprising the account and the proof preliminary thereto.
[2] II. Objection was made to the introduction of evidence in regard to certain items of the account and to the submission of these items to the jury on the ground that such items were barred by the statute of limitations (see Code 1931, sections 11007, 11011). This objection is based upon the claim that the last item of charge for work done in district 55 is April 28, 1921, and the last item of charge for work done in district 121 is August 26, 1921. Defendant's objection, however, is based upon the theory that claimant's account was against the owners of the land in the various districts and not against Davis, and that the account for each district was separate from all other accounts. The theory upon which the claim in this case was based, however, is that the claimant was employed by Davis; that the account was against Davis; and that, although kept by separate districts, it was only one continuous account against the same person.
Without going into the evidence in detail, it is sufficient to say that there was evidence upon which the jury might find that the claimant was employed by Davis, and that the claimant kept his *Page 514
account with reference to Davis and not with reference to or as charges against the owners of land. The jury was instructed that, before they could find for the claimant, they must find that the decedent had personally employed the claimant and agreed to pay him for the services rendered. They were also instructed that, in order to find for the claimant, they must find that the account as shown by the exhibits constituted a continuous, open, current account, and the meaning of these terms was explained to them. The defendant asked no further instructions in regard to this phase of the case, and, in our opinion, the instructions given were fully warranted by the evidence and fully covered the matters thus submitted to the jury. In reaching its verdict the jury must have found that there was a continuous, open, current account against the decedent, Davis, and that the items to which defendant referred were not barred by the statute of limitations.
[3] III. Further complaint is made by appellant that the alleged agreement made by the decedent, Davis, with the claimant is within the statute of frauds (Code 1931, section 11235), and that, since it was not in writing, it cannot be enforced by claimant. It is quite apparent, however, from the testimony of the witnesses who testified for plaintiff, that the agreement to which they testified was not an agreement upon the part of Davis to pay the debt of the different landowners, upon whose lands the claimant might do work, but was a direct and original agreement on the part of the decedent employing the claimant to perform work for him. The fact that this work was to be performed upon the lands of others in no way makes it an agreement to pay the debt of another. There is ample evidence in the record from which the jury might find, as it apparently did, that the claimant was not employed by the individual landowners either directly or indirectly, and that the contract of the landowners with the decedent was that he, Davis, was to employ an engineer for himself and not for the landowners.
[4] IV. A part of instruction 1 given by the court was as follows:
"The account on which plaintiff's claim is based has been received in evidence before you, the same being designated Exhibits A, B, C, C-1, D and E. The total amount which plaintiff claims to be due him, as the case is submitted to you, on said account is the sum of $592.15." *Page 515
Appellant excepted to this portion of the instruction and alleges error on the ground that such instruction gave undue prominence to the alleged original entries. Exhibits A, B, C, C-1, D, and E; that they were disputed by appellant and admitted over objections; and that the jury was not instructed to pass on their credibility or the claim that they were not original entries made at or about the dates the items bear. The portion of the instruction objected to was given in connection with the statement of the issues by the court. We do not find that any more prominence was given to this statement than to any other portion of the issues. The jury was instructed as to the weight of evidence and credibility of witness in another paragraph of the instructions. No further instruction was asked by appellant as to the matter of which she now complains. We find no merit in this allegation of error.
[5] V. Appellant also objects to a portion of instruction 3 given by the court, which is as follows:
"That pursuant to such employment the plaintiff did do the matters and things, or some of them, as set out in plaintiff's statement of account, Exhibits A, B, C, C-1, D, and E;".
Exception is taken to this instruction on the ground that it singles out weak and objectionable evidence on the part of plaintiff, calls such exhibits a statement of account, and constitutes a direction against appellant's contention that they are not original entries.
The portion of the instruction referred to constitutes one of three propositions which the court instructed the jury must be established by the claimant in order to recover. The instruction contained a further explanation as to the meaning of preponderance of evidence and cautioned the jury that, if plaintiff failed to establish any one of these propositions by such preponderance of evidence, the claimant could not recover. The portion of the instruction objected to, when taken in connection with the entire instruction in which it is found, and in connection with all other parts of the court's charge to the jury, was in our opinion properly given to the jury and did not constitute error.
VI. Objection is also made to instruction 9. This instruction had reference to the defense of the statute of limitations. Matters connected with the statute of limitations have already been discussed in the second division of this opinion. We have gone over this instruction carefully and believe it presents a proper direction to the *Page 516
jury as to the manner in which they were to consider the evidence presented and reach their determination as to whether or not certain portions of the claim were barred by the statute of limitations as contended by the appellant.
Other propositions contained in the errors relied upon for reversal are included in the matters which we have already discussed, and it is not necessary to extend this opinion further to consider them specifically and in detail.
We find no merit in the allegations of error relied upon by the appellant and the judgment of the trial court is, therefore, affirmed.
KINDIG, C.J., and STEVENS, ALBERT, ANDERSON, KINTZINGER, and MITCHELL, JJ., concur.
EVANS, J., takes no part.
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[1] This certiorari proceeding is brought to test the power and jurisdiction of the district court in setting aside a dismissal *Page 23
of a cause of action therein and reinstating the same on the calendar. A partnership brought the action, and a purported dismissal was made by certain alleged partners. Consequently a question arises concerning the authority of such partners to make the alleged dismissal. If, as hereinafter more fully set forth, the alleged partners who attempted to make the dismissal did not have the authority to act for the partnership in the premises, the district court had jurisdiction and power to set aside the alleged dismissal and reinstate the cause. An elaborate statement of somewhat complicated facts is essential for a complete understanding of the precise questions under consideration.
On the 3d day of January, 1910, Henry W. Lunt, a widower, of Mahaska county, Iowa, conveyed to his trustees, Johnson R. Lunt, his son, and Cole R. Van Gordon, his son-in-law, certain real estate in Iowa and Missouri for the benefit of the trustor's children, Johnson R. Lunt, Walter L. Lunt, Willie C. Lunt, Elba Lunt Van Gordon, and Mattie Lunt Vernon (now Mattie Lunt Van Gordon). Of the trustees above named, Johnson R. Lunt, the trustor's son, was a beneficiary under the trust.
The trustees were given the right to manage and control the real estate, to the end that the same might be properly farmed and cultivated. From time to time the trustees were required to report to the trustor and beneficiaries, during the trustor's life, and thereafter such reports were to be made to the beneficiaries. Provision was made in the trust deed for the children of any beneficiary who might thereafter die.
During the trustor's lifetime he was to be supported from the proceeds of the trust. Trust moneys were to be invested and reinvested. Many other items of benefit not here mentioned were granted to the beneficiaries through the trust deed. Under the terms of the trust deed, the trust was to terminate at the death of the trustor's last surviving child. There is a further provision in the trust deed that if, at the trustor's death, any of his children have preceded him in death, the heirs or legal representatives of such deceased child or children shall have no voice in determining "this trust. That the same can only be determined by my surviving children with the consent of my trustees aforesaid."
At the time the aforesaid trust deed was executed, the beneficiaries thereunder, by contract among themselves and with the trustees, agreed to articles of copartnership for the purpose of managing *Page 24
the farming business contemplated by the trust deed. In these articles of copartnership, the trust deed is specifically mentioned, and the two instruments apparently become one contract, except that the trustor in the trust deed did not expressly become a party to the articles of copartnership. The copartnership was conducted under the firm name and style of Lunt Farm Company. According to the articles of copartnership, Johnson R. Lunt and Walter L. Lunt were to have charge, management, and control of all the firm property with the exception of 126 acres of land. But there is apparently a limitation upon such management and control on the part of the two partners named. Under a later paragraph of the articles of copartnership, it is provided that, in case of the death of any partner or manager, the firm shall continue to exist and be managed by the survivors of the original partners.
As part of the scheme of management, the articles of copartnership provide that the heirs and personal representatives of a deceased original partner shall become interested in the firm and at the annual settlements "may, if they desire, receive and maintain their full share of the profits, or permit them to still continue in the partnership until the time of the final dissolution." Although that is true, it is provided, nevertheless, that such heirs and legal representatives of the deceased original partner "shall not be permitted to have the active management and control of the said partnership." All such management and control, the articles continue, "shall belong to the surviving partners to this agreement." While it is true that the articles of agreement are not skillfully drawn, yet, after a careful study of the entire document, the foregoing are the undoubted provisions thereof.
After the execution of the trust deed and the articles of copartnership, the trust was executed and the partnership conducted in the manner and way contemplated. Then, on May 31, 1922, Johnson R. Lunt, a trustee and a partner, died intestate. He was survived by Kitte Lunt, his wife, and the following children and heirs at law: Arloine Lunt McCulloch, Gordon R. Lunt, and Leland Lunt. The widow and the children, with the Lunt Farm Company, Walter Lunt, and Willie C. Lunt, are the petitioners and relators in the case at bar.
Following the death of Johnson R. Lunt, his widow, Mrs. Kitte Lunt, and his children, Arloine Lunt McCulloch, Gordon R. Lunt, and Leland Lunt, petitioners and relators, on July 3, 1922, executed *Page 25
three promissory notes payable to the Lunt Farm Company, a copartnership. These notes were for the sums of $1,542.16, $2,000, and $2,000, respectively. Each instrument was payable six months after date. Because the notes were not paid, the Lunt Farm Company, as a copartnership, commenced an action to collect the same against the said Mrs. Kitte Lunt, Mrs. Arloine Lunt McCulloch, Gordon R. Lunt, and Leland Lunt, petitioners and relators, at the February, 1933, term of the Mahaska county district court. Original notices were duly served, and Mrs. Kitte Lunt, Mrs. Arloine Lunt McCulloch, Gordon R. Lunt, and Leland Lunt, petitioners and relators, appeared and filed an answer. In their answer these petitioners and relators denied liability, but alleged the existence of the copartnership and declared that they were members thereof. Then, in an amended and substituted answer, these relators pleaded "that the said copartnership (Lunt Farm Company) existed at the time the alleged notes sued upon were executed, and said notes are alleged assets of the said copartnership, and that said copartnership still exists and is a going concern engaged in farming and stock raising. That the said members of the said copartnership are Walter Lunt, Willie C. Lunt, Mattie Lunt Van Gordon (formerly Mattie Lunt Vernon), Elba Lunt Van Gordon, and these defendants (the petitioners and relators). That by reason of the premises this plaintiff (Lunt Farm Company, a copartnership) has no authority to sue these defendants (the petitioners and relators), and these defendants are not indebted to the plaintiff (Lunt Farm Company) on the notes sued upon."
Whereupon the Lunt Farm Company, a copartnership, the plaintiff in the suit on the foregoing promissory notes, amended its original petition by setting forth some of the history of the organization of the copartnership, alleging the death of Johnson R. Lunt, naming the following petitioners and relators. Mrs. Kitte Lunt, as his surviving spouse, and Arloine Lunt McCulloch, Gordon R. Lunt, and Leland Lunt, as his surviving children and heirs, and declaring that such surviving spouse and heirs claim an interest in the copartnership. So, the Lunt Farm Company, a copartnership, in its amended petition prays: "Wherefore, plaintiff (Lunt Farm Company, a copartnership) asks that the Court determine as to whether said defendants (Kitte Lunt, Arloine Lunt McCulloch, Gordon R. Lunt, and Leland Lunt) are members of said partnership, and if the Court finds them to be members that the Court determine what accounting, *Page 26
if any, should be made of the partnership affairs since the 3rd day of July, 1922, and if the Court should find that any accounting of the partnership affairs should be had since said date, in order to determine the amount plaintiff is entitled to recover upon said notes, that the Court order an accounting of the partnership affairs since said date to the extent only that it may be necessary to determine the amount of judgment that should be rendered upon said notes and plaintiff (Lunt Farm Company, a copartnership) demands judgment against the defendants (the petitioners and relators), and each and all of them upon the notes described in its original petition and for the amount with interest, costs and attorney fees as prayed for in its original petition and plaintiff (the copartnership) asks for such other and further relief consistent with the allegations of its petition as may be equitable in the premises." Attached to the amended petition is the contract of copartnership before mentioned.
On May 22, 1933, the Lunt Farm Company, a copartnership, filed in said cause a motion to transfer to equity. Apparently on the same day W.L. Lunt, Leland Lunt, W.C. Lunt, Gordon R. Lunt, Arloine Lunt McCulloch, and Mrs. Kitte Lunt, petitioners and relators in the present certiorari proceeding, filed in said cause a written dismissal. See Bardes v. Hutchinson, 113 Iowa 610, 85 N.W. 797. As a basis for the dismissal, it is alleged by the petitioners and relators that, because there has been no accounting between the partners, the partnership could not sue the said Mrs. Kitte Lunt, Arloine Lunt McCulloch, Gordon R. Lunt, and Leland Lunt on the three notes before mentioned. Immediately after the written dismissal was filed, the Lunt Farm Company, a copartnership, Elba Lunt Van Gordon, and Mattie Lunt Van Gordon, partners, moved the court to strike the written dismissal, just named, in an endeavor to reinstate the cause upon the court calendar for trial. It is alleged in the motion to strike that the original action on the notes was commenced with the consent and authority of the said Elba Lunt Van Gordon and Mattie Lunt Van Gordon, but that the dismissal was without their authority and without the authority of the copartnership, as such. Also it is alleged by the movants that the dismissal of the suit will be contrary to the interests of the partnership. In argument, it is pointed out that the notes will be barred by the statute of limitations if the dismissal of said cause is permitted to stand. Further, it is alleged in the motion that the dismissal of said cause was not a partnership action because those who attempted to *Page 27
dismiss it had no authority to represent the firm in that regard. Consequently, on May 26, 1933, during the same term in which the said purported dismissal was filed, the district court sustained the motion to strike the dismissal, on the theory that thereby the cause was reinstated on the calendar for trial. There is no claim that this is not true. We therefore do not give consideration to that phase of the record.
It is argued, however, that the district court did not have jurisdiction or power to reinstate the cause by striking the written dismissal, because after the filing of the written dismissal the cause was in fact dismissed, and consequently no cause thereafter pended. Relying upon that theory, the petitioners, on July 6, 1933, obtained from a justice of this court a writ of certiorari commanding the respondent, the district court, through its judge, the Honorable D.W. Hamilton, to certify and return fully to this court a transcript of the records and proceedings relating to the order striking the dismissal, and reinstating the cause on the calendar.
I. If, as said by the relators, the cause was in fact dismissed with the filing of the written dismissal, then, in that event, the district court would have been without jurisdiction to set aside the dismissal under the facts in this record. No claim is made that there was any basis for setting aside the dismissal, except, as before said, for the lack of authority in those who attempted to make the dismissal. Section 11562 of the 1931 Code provides:
"An action may be dismissed, and such dismissal shall be without prejudice to a future action: 1. By the plaintiff, before the final submission of the case to the jury, or to the court when the trial is by the court."
We had occasion to consider this section of the statutes in Ryan v. Phoenix Insurance Co., 204 Iowa 655, 215 N.W. 749. 750. Reading on page 656 of that opinion, we said:
"The right of the plaintiff to dismiss his cause of action at any time before the final submission thereof to the jury, or to the court when the trial is without a jury, is conferred by section 11562, Code 1924 [a similar section in the 1931 Code], and is absolute. Ordinarily, the effect of such dismissal is final and terminates the jurisdiction of the court thereof."
To the same effect, see Chicago, Rock Island Pacific Ry. Co. *Page 28
v. Dey, 76 Iowa 278, 41 N.W. 17; Kiser v. Crawford, 182 Iowa 1249, 166 N.W. 577.
In the case at bar, however, a copartnership was the plaintiff in the action pending in the Mahaska county district court. This copartnership had commenced that action. While a copartnership is a legal entity in Iowa (section 10983, 1931 Code; Jensen v. Wiersma, 185 Iowa 551, 170 N.W. 780, 4 A.L.R. 298; Van Dyk v. Mosterdt, 171 Iowa 3, local citation, 17, 153 N.W. 206), yet the entity only can act through its representatives. It was said, in Van Dyk v. Mosterdt (171 Iowa 3) supra, reading on page 16:
"The members of the firm [partnership firm] are simply the agents of the entity, and can only bind it within the scope of their legal authority as such agents."
The notes sued upon in the present controversy were the property of the copartnership. Therefore, the copartnership was the real party in interest. Because of that fact it alone could bring the suit, and it alone could dismiss it. See, generally, 20 Ruling Case Law, p. 920, sec. 132, under VI; Van Dyk v. Mosterdt (171 Iowa 3, 153 N.W. 206), supra.
When dismissing its suit, as before indicated, the copartnership necessarily had to act through its representatives. Unless the representatives who purported to act for the partnership had authority so to do, the result would not be a partnership action. Before a partnership action can be accomplished, the representatives acting for the entity must be authorized to produce the result. Without such authority, the attempt to bring about a partnership action never will ripen into a reality. Under the record, then, it is important now to consider whether the relators who filed the written dismissal were authorized so to do.
Apparently by mutual consent the case is presented upon the theory that the deed of trust and articles of copartnership are a part of the respondent's return. According to the theory of the presentation, the jurisdiction of the district court is to be determined from these documents. Therefore, we dispose of the jurisdictional questions by considering the deed of trust and the articles of copartnership. Whether certiorari is the proper remedy, we do not decide. The respondent raises no issue as to that.
It is argued by the relators that at least W.L. Lunt had authority to dismiss the suit because he was the sole manager in *Page 29
control of the partnership property under the articles of copartnership before mentioned. While it is true that the articles of copartnership declared that Johnson R. Lunt and Walter L. Lunt "shall have charge of, and manage and control all the property", etc., yet the instrument does not, when read as a whole, thus authorize the survivor of the two managers. Johnson R. Lunt, as before stated, is now dead, and Walter L. Lunt survives him. As before stated, the partnership agreement makes provision for this situation. It is provided therein that, in case of the death of a partner or manager, the firm shall continue to exist and be managed by the surviving partners. There is an express provision that the representative of such deceased partner shall not have active management or control of the partnership. Apparently, for the purpose of emphasis, the same paragraph ends as it began, by declaring that the management and control in the event under consideration shall belong to the surviving partners. A careful reading of the entire agreement, therefore, compels the conclusion that the partners were willing for Johnson R. Lunt and Walter L. Lunt to manage the partnership business while they both lived, but, in the event one of them should die, it appears that the remaining partners then desired to have control. Nothing appears, therefore, in the contracts and matters of record to indicate, as claimed by the petitioners and relators, that Walter L. Lunt had authority to manage and control the partnership business at his own discretion. He therefore had no right, under the circumstances, to dismiss the suit without the consent of the partners. Obviously the relators who were defendants in the suit on the notes would have no authority to dismiss the proceedings. They were interested adversely to the Lunt Farm Company, the copartnership which brought the action. Moreover, these particular relators, as before indicated, were the wife and surviving children of Johnson R. Lunt, deceased. The articles of copartnership, as before suggested, expressly provide that such representatives of the deceased partner shall have no active control or management of the partnership affairs. Therefore, the only partners who signed the dismissal who had anything to say about the management or control of the entity were Walter L. Lunt and W.C. Lunt. Elba Lunt Van Gordon and Mattie Lunt Van Gordon, who joined with the partnership in setting aside the dismissal, authorized the original suit, but were not consulted concerning, and were not parties to, the dismissal. These partners had a right to object to the dismissal because they were interested in the partnership. *Page 30
The copartnership owned the notes sued upon, and resultantly Elba Lunt Van Gordon and Mattie Lunt Van Gordon were interested in the notes to the extent of their interests in the copartnership.
Manifestly the copartnership would be prejudiced by a dismissal of the suit, for an action on the notes apparently would be barred in the event the suit were dismissed. So far as indicated by the record, Elba Lunt Van Gordon and Mattie Lunt Van Gordon, who asked to have the dismissal stricken, are on a par in the management of the partnership affairs with Walter L. Lunt and W.C. Lunt. Cole R. Van Gordon, who, as trustee, signed the partnership agreement, did not authorize the dismissal, and, if he has any management of the partnership affairs, a majority of the partners are opposed to the dismissal. At least, considering the record in the best light for the relators, half of the managing partners were opposed to the dismissal. Not only were the relators unauthorized to dismiss the suit, but their action in so doing would result in prejudice and loss to the copartnership. In view of the fact that the makers of the notes joined in the dismissal, it would appear that the relators joined in a united attempt to injure the partnership and thereby serve some purpose of their own. Because the relators, in attempting to dismiss the suit, acted without authority, their conduct did not amount to a partnership action.
Consequently the suit in fact was not dismissed, and the district court acted within its power, authority, and jurisdiction when striking the purported dismissal.
[2] II. But it is said that the suit was not legally brought, and therefore the dismissal was justified because the firm cannot sue a partner until there has been an accounting. See Dolan v. McManus, 209 Iowa 1037, 229 N.W. 687. Whether this would be a basis for certiorari, we do not now decide. Although not deciding whether certiorari will lie at this juncture, however we continue the discussion on the petitioners' argument.
"It is a well-recognized exception to the rule contended for [the one just stated] that, where the liability has been made the subject of an express contract, or has been segregated from the partnership business, an action at law by one partner against another may be maintained thereon without a settlement, or an accounting of the partnership business." In re Estate of Talbott,200 Iowa 585, local citation, pages 590, 591, 203 N.W. 303, 306. *Page 31
Apparently, in recognition of these rules, the plaintiff partnership in the suit on the notes amended its petition by pleading matters justifying an accounting between the partners. Basing its prayer for relief thereon, the partnership, as plaintiff in that suit, asked that it be determined who were the members of the firm, that an accounting between them be had, as provided by the articles of copartnership, and for general equitable relief. Following that amendment and prayer, the partnership, as plaintiff, moved to transfer the cause to equity. There was no objection to the motion to transfer to equity by the defendants in the suit on the notes. Undoubtedly, then, the cause would have been transferred had the relators not filed their purported dismissal. Under all the circumstances, therefore, it cannot be said that the district court acted without jurisdiction or power in the premises.
Wherefore, the writ issued is annulled, the petition therefor is dismissed, and the order of the respondent court is affirmed.
Writ annulled, petition dismissed, and the order of the respondent affirmed.
ALBERT, C.J., and EVANS, CLAUSSEN, and DONEGAN, JJ., concur.
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In 1918 or 1919, defendant Ernest Graham became indebted to the Valeria Savings Bank for $5,000 on promissory notes. On November 24, 1922, he executed to the bank an instrument entitled "assignment of expectancy in estate," which declared:
"For value received I hereby sell, assign and set over unto *Page 518
the Valeria Savings Bank of Valeria, Iowa, all my claim in expectancy to the estate of my father Norman A. Graham of Des Moines, Iowa, which I may acquire as heir at law or devisee or legatee of my said father * * * the amount of money or property which shall be received by the Valeria Savings Bank of Valeria, Iowa, under this assignment shall first be used to extinguish and pay up the indebtedness which I owe said bank and which I may owe said bank at the time I shall be entitled to the money or property from the estate of my father. * * * Any excess * * * shall be paid to me. And if the amount * * * which I receive from said estate shall not be sufficient to pay * * * my indebtedness to said bank in full that [then] said money and property shall be applied on my indebtedness to said bank as far as it will go."
On September 1, 1924, he executed to the bank renewal notes for this indebtedness. About October 18, 1924, plaintiff, who was president of the Valeria Savings Bank, was required by the bank examiner to pay to the bank the amount due on this paper, which he did, and took an assignment of it. On March 2, 1926, Ernest filed petition in bankruptcy, in which he listed the notes in question. Plaintiff filed no claim, and took no part in the bankruptcy proceedings. On December 9, 1926, defendant Ernest was discharged from all his provable debts.
On June 18, 1926, after the filing of the petition in bankruptcy, the father died, leaving a will dated January 18, 1926, by which there was given to Ernest for life the income from a farm. This suit, so far as we are now concerned, is to enforce the assignment by subjecting the bequest to the payment of the notes mentioned and foreclosing the interest of the defendant Ernest in the bequest.
The defenses are: (a) That defendant's signature to the assignment was procured by fraud; (b) that the assignment is void because made without the knowledge or consent of the father; (c) that the assignment or mortgage of the expectancy was, at most, an executory agreement, creating no lien during the father's lifetime; and that the discharge in bankruptcy while the father was still living discharged the assignment or mortgage, as well as the personal liability upon the notes.
Defendant also contends that there was no adequate *Page 519
1. CONTRACTS: consideration for the assignment. The assignment considera- was made only as security for the payment of a tion: debt admittedly just and owed to the assignee. assignment The consideration is adequate. 41 Corpus Juris of 385. expectancy as security I. Defendant testifies, in substance, that he did not know or understand, at the time the paper was executed, what it was; that he was not given sufficient time to read it, and its contents were not made known to him. His testimony on this subject is not convincing, and is overcome by the opposing evidence.
II. It has been held that the assignment of an expectancy in the estate of a living ancestor is void if made without the ancestor's knowledge or consent. Stevens v. Stevens, 181 Mich. 449
(148 N.W. 229); McClure v. Raben,125 Ind. 2. ASSIGNMENTS: 139 (25 N.E. 179); Flatt v. Flatt, 189 Ky. 801
requisites (225 S.W. 1067); Elliott v. Leslie, 124 Ky. 553
and (99 S.W. 619). See 5 Corpus Juris 854 et eq.;
validity: 49 Corpus Juris 1117. The rule in this property, jurisdiction is that an assignment of such an estates, and expectancy, though it will be carefully rights scrutinized, and is not favored, yet, if it is assignable: made in good faith, for an adequate expectan- consideration, and without fraud, and if it is cies. not otherwise unconscionable or invalid, will be sustained and enforced in equity. Lee v. Lee, 207 Iowa 882; Bergv. Shade, 203 Iowa 1352; Richey v. Richey, 189 Iowa 1300; Richeyv. Rowland, 130 Iowa 523; Klingensmith v. Klingensmith, 193 Iowa 350.
III. The assignment was executed merely by way of security. If operative at all, it was as a mortgage, 3. BANKRUPTCY: incidental to the debt. The main point of discharge of contention is whether or not the mortgage of the bankrupt: expectancy survived the discharge in bankruptcy, discharge as granted on adjudication of bankruptcy after the affecting execution of the mortgage, but before the death assignment of the father. Section 67 of the Bankruptcy Act of (9 United States Comp. Stat. [1916], Section expectancy 9651) prescribes what are and what are not liens as security. within the purview of the act, and among other provisions declares:
"(d) Liens given or accepted in good faith and not in contemplation of or in fraud upon this Act, and for a present *Page 520
consideration, which have been recorded according to law, if record thereof was necessary in order to impart notice, shall, to the extent of such present consideration only, not be affected by this Act."
This section applies only to liens on the estate of the bankrupt at the date of the adjudication in bankruptcy. At the date of the adjudication, defendant's father was living, and defendant had no then present interest or right of property in his father's estate which would pass to the trustee. Mitchell v.Winslow, 2 Story 630; In re Baker, 13 Fed. (2d Ser.) 707;Dioguardi v. Curran, 35 Fed. (2d Ser.) 431; In re Lage,
19 Fed. (2d Ser.) 153; Bank of Elberton v. Swift, 268 Fed. 305. If, however, the plaintiff, by the mortgage of the expectancy, acquired a lien upon defendant's interest in his father's estate when it should come into defendant's possession, such lien, not being one that was dissolved by the terms of the Bankruptcy Act or repugnant to it, remained, notwithstanding the discharge of the debt which it secured. 7 Corpus Juris 410. The discharge released defendant from his legal liability to pay his provable debts. The moral obligation and such liens as were not dissolved by the terms of the Bankruptcy Act or as were not repugnant to that act remained. Zavelo v. Reeves, 227 U.S. 625, 629
(57 L. Ed. 676, 678); Fierce v. Fleming, 205 Iowa 1281; Shively v. GlobeMfg. Co., 205 Iowa 1233, and cases cited; United States Code Annotated, Title 11, Section 32, page 110 et seq., Section 107, page 152 et seq.
The precise question here involved came before the English Court of Chancery in In re Lind, I Ch. Div. (1915) 744, and before the Court of Appeal, 2 Ch. Div. (1915) 345 (84 L.J. Ch. [N.S.] 884). In that case Lind, in 1905; mortgaged his then expectant share in the estate of his mother, who was then living, though insane. In 1908, he was adjudicated a bankrupt, and in 1910, obtained his discharge. The mortgagee did not prove in bankruptcy. In 1914, the mother died, and Lind's share in her estate, as such, thereupon came into existence. The Plaintiffs in that case, to whom Lind, after his discharge in bankruptcy, had assigned his expectant share in the estate, contended that the mortgages made prior to the date of the discharge "were in law nothing but contracts to assign, creating debts provable *Page 521
in bankruptcy, and that the effect of the bankruptcy and the order of discharge therein has been to release Lind from all liability under such contracts, and accordingly to render the assignments wholly ineffectual." The authorities were extensively reviewed by the participating justices of the two courts, whose reasoning and conclusion are sufficiently indicated by the language of one of them, as follows:
"It appears to me to be manifest from these statements of the law that equity regarded an assignment for value of future-acquired property as containing an enforceable security as against the property assigned, quite independent of the personal obligation of the assignor arising out of his imported covenant to assign. It is true that the security was not enforceable until the property came into existence, but nevertheless the security was there, and the assignor was the bare trustee of the assignee, to receive and hold the property for him when it came into existence. Warrington, J., in the court below, put his view into these words (1): `In the present case I am of opinion that the mortgagees were, at the time of the bankruptcy, entitled, not merely to the benefit of a personal obligation on the part of the mortgagor, resulting in a claim for damages, but to a prospective interest in the distributive share in question, taking effect automatically on the death of Florence Lind.' For the reasons stated above, I think that there is a question whether the personal obligation on the part of the mortgagor in a case like the present results in a claim for damages, if by that is meant only in a claim for damages, but I quite agree in the latter part of the learned judge's statement of the position of the mortgagees."
The identical question was presented and ruled in the same way in Bridge v. Kedon, 163 Cal. 493 (126 P. 149, 43 L.R.A. [N.S.] 404), in which the conclusion reached was:
"The assignment is treated in equity as a present contract to convey the future interest, a contract which creates a trust as soon as the interest becomes absolute; and this is a present existing right by contract, which the discharge in bankruptcy does not avoid or terminate. The continued existence of the debt as a personal obligation to pay money is unnecessary to *Page 522
the enforcement of an equitable charge or lien upon specific property."
A like result was reached by one of the appellate courts of Illinois in Dumont, Roberts Co. v. McDougal, 200 Ill. App. 583, and by the Supreme Court of Dakota in Thompson Yards v.Richardson, 51 N.D. 241 (199 N.W. 863), a case which involved a mortgage upon unplanted crops. See 3 Pomeroy's Equity Jurisprudence (4th Ed.), Sections 1285 to 1290. Section 1288 says:
"In other words, the doctrine of equitable assignment of property to be acquired in future is much broader than the jurisdiction to compel the specific performance of contracts. In truth, although a sale or mortgage of property to be acquired in future does not operate as an immediate alienation at law, it operates as an equitable assignment of the present possibility,
which changes into an assignment of the equitable ownership as soon as the property is acquired by the vendor or mortgagor; and because this ownership thus transferred to the assignee is equitable, and not legal, the jurisdiction by which the right of the assignee is enforced, and is turned into a legal property, accompanied by the possession, must be exclusively equitable * * *."
In Mitchell v. Winslow, 2 Story 630, Justice Story had before him the case of a conveyance of all machinery, tools, and implements in a named manufactory "of every kind thereunto belonging and appertaining, together with all * * * which we [the mortgagors] may at any time purchase for four years from this date, and also all the stock which we may manufacture or purchase during said four years." Thereafter, the grantors were declared bankrupts, and an assignee was appointed. Shortly before the filing of the petition in bankruptcy, the mortgagee took possession of the property, including that which had been made and purchased after the execution of the mortgage. The assignee in bankruptcy petitioned for authority to take possession. Justice Story reviewed the authorities at length, concluding, as a result of them, that:
"Wherever the parties, by their contract, intend to create a positive lien or charge, either upon real or upon personal *Page 523
property, whether then owned by the assignor or contractor or not, or if personal property, whether it is then in esse or not, it attaches in equity as a lien or charge upon the particular property, as soon as the assignor or contractor acquires a title thereto, against the latter, and all persons asserting a claim thereto under him, either voluntary, or with notice, or in bankruptcy."
See 2 Story's Equity Jurisprudence (13th Ed.), Section 1231;Thompson v. Fairbanks, 196 U.S. 516 (49 L. Ed. 577); 5 Corpus Juris 856; 2 Ruling Case Law 606.
This court had before it a somewhat analogous question in Bisbyv. Walker, 185 Iowa 743. In that case a testator had bequeathed to his wife all of his property for life, with remainder to the children of testator's daughter Ellen, then living, "in equal shares, to have and to hold the same forever, without right of alienation of any of the real estate, during the life of their mother [Ellen] * * *" One of these grandchildren, during the lifetime of the testator's widow, incurred indebtedness, to secure which she mortgaged her interest in the real property of testator's estate. Later, she filed voluntary petition in bankruptcy, listing among her creditors the mortgagees, and listing her interest in the land under the will. The bankruptcy court determined that she had no interest in the real estate at that time, and that the trustee took no right to it. The mortgagor was discharged in bankruptcy. After such discharge, the testator's widow died. In suit for partition of the land bequeathed by the will, the mortgagor alleged that the mortgages were not claims or liens against the land, and asked that her interest be quieted against them. This court held that the mortgages operated by estoppel to convey the afterward-acquired fee. After holding that the subsequently acquired vested remainder inured to the benefit of the mortgagee by way of estoppel, this court further said:
"The only consequence of a discharge in bankruptcy is to suspend the right of action for a debt against the bankrupt person. If the creditors have a lien or equitable claim by mortgage or otherwise upon the property of the bankrupt, such right or rights remain unaffected. The independent collateral agreement given by way of security outlives the remedy on the debt which it was given to secure. [Here follows reference to Section *Page 524
67 (d), Bankruptcy Act.] * * * Nor did the discharge of the bankrupt obviate the attachment of the mortgages as liens on the after-acquired property. Subsequent to her discharge, she asserted her claim in and to the property, which the trustee in bankruptcy declined to take, as she might lawfully do, and the property stood in the same relation to the incumbrances thereon as before the petition in bankruptcy had been filed. In other words, the rights of the mortgagor and mortgagees were precisely the same as before, save that personal liability on the indebtedness might not be enforced in an action personally against the mortgagor as a debtor, owing to her discharge in bankruptcy. We have dealt with the remainder in this portion of the opinion on the theory that it was contingent, but without the design of so determining. Our conclusion is that, whether contingent or vested, the mortgages were rightly found enforcible against Mrs. Bisby's one-third interest in the real estate."
It will be observed that the discussion thus quoted was not essential to the adjudication. We have made these extensive quotations in order that the premises from which the conclusions were drawn may clearly appear: namely, that, though the assignment or mortgage of a mere expectancy does not operate as a present conveyance, and though necessarily the mortgagee or assignee of such an expectancy takes and can take no present property right in the ancestor's estate, he obtains by the contract a present possibility and a transfer to himself of the prospective interest, which automatically takes effect on the death of the ancestor.
A contrary conclusion with respect to a mortgage executed prior to bankruptcy on crops grown afterwards was reached by the Supreme Court of Alabama in Butler Cotton Oil Co. v. Collins,200 Ala. 217 (75 So. 975). It was there held that, at the time of the adjudication in bankruptcy and discharge, the property had no existence, actual or potential, — it was a mere expectancy. There was then nothing to which a lien could attach. In the somewhat analogous case of an assignment of future earnings, the courts have arrived at variable conclusions. It has been held that an assignment of wages to be earned under an existing contract of employment survives the discharge in bankruptcy.Mallin v. Wenham, 209 Ill. 252 (70 N.E. 564, *Page 525
65 L.R.A. 602, 101 Am. St. 233); Citizens Loan Assn. v. Boston Maine Railroad, 196 Mass. 528 (82 N.E. 696, 124 Am. St. 584, 14 L.R.A. [N.S.] 1025; 13 Ann. Cas. 365).
The reasoning in the Massachusetts case is that the employee under an existing contract of employment has an actual interest in the wages to be earned, unjustifiable interference with which contract is a remediable injury; that money to accrue from such services is not properly an expectancy or mere possibility, but a present existing right of property in potential possession; that the assignment of future earnings which may accrue under such a contract is valid and enforcible at law and in equity.
In Leitch v. Northern Pac. R. Co., 95 Minn. 35 (103 N.W. 704, 5 Ann. Cas. 63), it was held:
"* * * when the debtor filed his petition in bankruptcy, and when he received his discharge, [plaintiff] had no lien on or vested security in the wages of the debtor thereafter to be earned by virtue of his contract, which was to take effect as an assignment when the wages were earned. The plaintiff then had, at most, a mere expectancy, depending on contingencies. We accordingly hold that the discharge in bankruptcy released the debtor from any liability of having his wages thereafter earned applied in payment of the debt from which he had been discharged."
Likewise, in Levi v. Loevenhart Co., 138 Ky. 133
(127 S.W. 748), it is said:
"Undoubtedly the order in question secured to plaintiff an equity, — suspended, as it were, — which attached immediately that the wages were earned, and secured to him a priority in the earned wages to the extent stipulated in the order, superior to that of any other creditor; but such right did not attach until the wages were earned. The order was valid only so long as the indebtedness of plaintiff remained unsatisfied. It is of no higher or greater dignity than the debt. It is merely an agreement that there shall be appropriated out of the debtor's wages a stipulated sum, to be credited on his debt until it is satisfied: i.e., paid or discharged. By his discharge in bankruptcy Metzler settled every debt that he owed — was entirely, completely, and finally relieved from any and all liability on account thereof; and, as *Page 526
plaintiff's claim was set up and described in the proceeding in the bankruptcy court as a debt owing by Metzler, it was likewise canceled, satisfied, and settled, and, being settled, the conditions of the order were fully satisfied, and appellee relieved from all liability thereunder."
Discharge was held to avoid assignment of wages in In re HomeDiscount Co., 147 Fed. 538; In re West, 128 Fed. 205.
The majority of the court are of the opinion that only actually existing liens upon property of the bankrupt are saved from the effect of a discharge. In the case of an assignment of mere expectancy, — at least when not assented to by the ancestor, — no present existing property right in the assignor exists or is assigned. The assignor may die in the ancestor's lifetime. In such case, his heirs would take, not from him, but from the remote ancestor. 18 Corpus Juris 817; McAllister v. McAllister,183 Iowa 245. A will may be made disinheriting him. The estate itself may, in the ancestor's lifetime, be dissipated. The assignor in these conditions can have not even a potential interest in the estate. He has an expectancy or possibility only. If the assignment is made and received in good faith, for an adequate consideration, and without fraud, and is not otherwise unconscionable or invalid, equity will sustain and enforce it as a contract to assign. In the case before us, however, the purported contract could in no event be given effect other than as a contract to assign. Such assignment is, therefore, executory only, and subject to contingencies, and incident to the debt. The principal thing, the debt, has been discharged.
"But until the event has happened, the party contracting to buy has nothing but the contingency, which is a very different thing from the right immediately to recover and enjoy the property. He has not, strictly speaking, a jus ad rem, any more than a jus inre. It is not an interest in the property; but a mere right under the contract. Indeed, the same effect takes place in such cases if there be an actual assignment; for, in contemplation of equity, it amounts, not to an assignment of a present interest, but only to a contract to assign when the interest becomes vested." 2 Story's Equity Jurisprudence (10th Ed.), Section 1040c. *Page 527
See, also, 2 Ruling Case Law 606; Bayler v. Commonwealth, 40 Pa. St. 37 (80 Am. Dec. 551); In re Estate of Garcelon, 104 Cal. 570
(38 P. 414, 43 Am. St. 134; 32 L.R.A. 595). If we accept the rationale of 3 Pomeroy's Equity Jurisprudence (4th Ed.), Section 1288, and the authorities previously cited, nevertheless it is only as an executory contract that the assignment operates. It "operates as an equitable assignment of the presentpossibility, which changes into an assignment of the equitableownership as soon as the property is acquired * * *."
The assignee takes presently no title or interest whatever. He takes nothing at law. His sole remedy is to go into equity and enforce that which is, for the purpose of doing equity, construed as a promise to convey the property, or to hold it in trust if and when it shall be acquired.
Until the death of the ancestor, the assignee has only a possibility, which, on the ancestor's death, is, on equitable principles, particularly on the maxim that equity considers that done which ought to be done, transmuted into an interest in the property which the assignor may be decreed to hold in trust. On this theory, there is in existence prior to the death of the ancestor only a possibility, and an imputed agreement to transmute the possibility into a property right on the contingency that the property right matures.
At the time of the adjudication and discharge, the plaintiff had no existing lien. He had only that which equity would transmute into a covenant to assign if the property should come into existence. Plaintiff, then, had merely the covenant or promise of the defendant, without any existing property right. A mere promise or agreement of such character, unconnected with an existing property right, is so of the substance of and inseparable from personal remedies to enforce the obligation that it necessarily expires with the expiration of personal remedies. To keep in force a remedy so personal in its nature must protanto, or as the occasion arises, keep the obligation in force. The obligation, as respects all personal remedies upon it, as such, having expired, ought not to be continued in order that a lien which cannot, from the necessities of the case, exist at the time of the discharge, may be subsequently created. At the time of the adjudication, there was no lien. The moral obligation might be continued after discharge, to the extent necessary for the purpose *Page 528
of enforcing an existing lien, but ought not to be continued in order to bring into existence a future lien. To sustain such an assignment as an existing lien would, to a serious extent, thwart the purpose of the Bankruptcy Law. It would not altogether harmonize with the rule of this jurisdiction that assignments of such expectancies are not favored. We are not disposed to enlarge the field of recognition of them. We hold as the law of this state that an assignment such as that in controversy creates no existing enforcible lien upon the prospective inheritance of the assignor, and that the possibility of a future decree in equity, enforcing such an assignment, confers no property right which will relate back to the date of the assignment.
Whether or not the assignment, if absolute, and, but for the bankruptcy, otherwise enforcible, would have given rise to a provable claim, or to a remedy surviving the discharge, is a matter upon which we express no opinion. — Affirmed.
EVANS, FAVILLE, De GRAFF, ALBERT, WAGNER, and GRIMM, JJ., concur.
STEVENS and KINDIG, JJ., dissent.
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The defendant offered no testimony. We have to do, therefore, with the version of facts as presented in the testimony on behalf of the plaintiff. In May, 1920, the defendant *Page 1081
entered into a contract of purchase with the 1. SPECIFIC plaintiff, for the plaintiff's farm of 160 PERFORMANCE: acres, at an agreed price of $43,000. As a part discretion of the purchase money, the defendant paid $1,000 of court: in cash, and executed and delivered his note for complica- $4,000. The written contract provided that it tions should be fully performed on March 1, 1921, at arising which time the defendant was to pay to plaintiff because of the further sum of $28,000, and to take lapse of conveyance of the property, subject to time. incumbrance of $10,000. Time was of the essence of the contract. As explanatory of the subsequent conduct of the parties, it appears that, shortly before this contract of purchase was entered by Griffey, he had himself sold his own farm to one Lubbin, for approximately the same price as he now proposed to pay the plaintiff. This contract also was to be performed by Lubbin on March 1, 1921. Shortly prior to March 1, 1921, it became known to Griffey that Lubbin would probably be unable to perform his contract of purchase on March 1st. Such failure on the part of Lubbin would render Griffey wholly unable to perform his contract of purchase with the plaintiff on the date fixed. Griffey advised the plaintiff of his apprehension and of his dilemma. They had several conferences on the subject, immediately prior to March 1st. They discussed, to some extent, methods by which Griffey could perform, notwithstanding the failure of Lubbin. To that end, plaintiff offered to accept mortgages, in lieu of the cash agreed to be paid. The plaintiff's attitude towards the defendant in these conferences was one of leniency. As a result of these conferences, it was known to both of them, immediately prior to March 1st, that Griffey could not perform on that day, and the plaintiff made no insistence upon time as the essence of his contract. We think that the fair purport of these various conversations was a mutual understanding that the time of performance should be deferred beyond the date fixed. The parties did not, therefore, meet on March 1st, nor, so far as appears, did either of them present himself at the place where the contract was to be performed. The parties did meet on March 2d, and renewed their conference. One subject of the conference was the failure of Griffey to collect from Lubbin. Griffey also sought release from plaintiff's contract, and offered $2,000 for such release. This was declined *Page 1082
by the plaintiff. Griffey also said that, unless he could recover from Lubbin, he would not be able to perform the contract. He expressed a purpose to begin suit against Lubbin, unless he could settle with the plaintiff. Shortly thereafter, he did begin suit against Lubbin. The attitude of plaintiff continued to be one of leniency. It was understood between him and Griffey that he should utilize the land, by renting it. This he did by renting to his own son, who continued in the occupancy of the farm up to the time of the trial in the court below. Griffey prosecuted his action against Lubbin, and was finally defeated. His attitude towards plaintiff, at all times, in their mutual conferences, was that he could not perform unless he could recover from Lubbin. This appears to have been his final attitude when he failed to recover from Lubbin. The plaintiff brought his action in February, 1922. It was tried in the lower court in the latter part of May, 1923. The theory of defense put forward by the defendant is threefold:
(1) That time was of the essence of the contract, and that the plaintiff did not tender performance on the date fixed in the contract, and that no legal excuse was shown for such failure.
(2) That the plaintiff still retained possession of the land, and had rented the same to a tenant, and was unable to place the defendant in possession of the land, in event of decree in his favor.
(3) That the circumstances of the case are such as to justify the court, in the exercise of sound discretion, in refusing specific performance.
The foregoing are the three propositions set forth in appellee's argument as grounds of affirmance upon plaintiff's appeal. As grounds for recovery upon his own counterclaim, he puts forward the further proposition that the contract was, in legal effect, rescinded by the mutual abandonment and understanding of the parties, and that, therefore, the defendant is entitled to be restored to the status quo, and to recover the money paid and the promissory note delivered by him.
The ground of decision of the trial court does not appear in the record. Inasmuch, however, as he dismissed both the petition of the plaintiff and the counterclaim of the defendant, he must have found, upon the evidence, that there was neither a *Page 1083
mutual rescission of the contract nor a breach of the same by the plaintiff. The decree, being on its face adverse to both parties, can be rendered consistent in its two parts only upon the theory that, in the exercise of a permissible discretion, the court refused specific performance to the plaintiff, leaving to him his remedy at law, and dismissed the counterclaim for failure of proof of the grounds upon which it was predicated. A careful study of the record satisfies us that the decree should be approved in both respects, on the theory here stated.
I. Turning first to the appeal of plaintiff, was it within the sound discretion of the court to refuse specific performance to the plaintiff, even though he had been guilty of no breach on his part? Assuming as correct the plaintiff's 2. VENDOR AND contention of fact, the failure of these parties PURCHASER: to appear at the place of performance on March mutual 1st amounted to a mere waiver of time as of the default: essence of the contract, on the part of both of effect. them. If both were thereby in default, then neither was. The contract was still enforcible by either party, upon demand and tender. The fact remains that, through the inability of the defendant, and through the leniency of the plaintiff, a long time elapsed after March 1, 1921, and before the date of the trial on the last of May, 1923. The longer the lapse of time after the proper date of performance, the more difficult does a decree of specific performance become. The contract was drawing interest; the plaintiff was receiving the rent share of the crops. Taxes accrued, and had to be paid. A decree of specific performance would require a burdensome accounting for rent share of crops for 1921 and 1922, and would further require a difficult accounting for the first three months of the season of 1923. At the time of the trial, the land was all under growing crops, of which none was mature. The complications thus created by the mere lapse of time, made a strong call upon the court's discretion as to the remedy of specific performance
Under all the circumstances appearing in the record, we think this discretion was fairly exercised. This would leave to the plaintiff his remedy at law. Doubtless this ought to have been indicated in terms in the decree.
II. Turning now to the appeal of the defendant from that part of the decree which dismissed his counterclaim, we *Page 1084
think the grounds of complaint are not tenable. The argument is, in substance, that the conduct of the parties 3. VENDOR AND amounted to an abandonment of the contract, and PURCHASER: thereby to a mutual rescission thereof. Without remedies of doubt, the plaintiff was at all times ready, purchaser: able, and anxious to carry out the contract. In nonright to the light of events already existing on March 1, status quo. 1921, the contract was clearly advantageous to him. Never, in terms or intent, did he assent to a rescission of the contract. It is argued that he assented to a modification of it, in this: that Griffey was to perform it provided he could enforce his contract against Lubbin. The only ground in the record for this contention is that Griffey insisted from the beginning that he could not perform, unless he could enforce his contract against Lubbin. In the light of subsequent events, Griffey disclosed that what he meant by saying that he could not,
was that he would not, except upon the condition named. It is argued that the conduct of the plaintiff, in the presence of such an assertion, amounted to acquiescence and consent. If, prior to March 1, 1921, Griffey unequivocally notified the plaintiff that he could not perform on the date named, this amounted to a breach of the contract on his part. The plaintiff could have treated it as such, and could have maintained an action for damages for such breach, without even waiting for the date of performance. The plaintiff did not lose such right of action by delaying the commencement of it. Nor, on the other hand, was plaintiff bound to adopt such remedy. He had an equal right to resort to the remedy of specific performance. In order to avail himself of such remedy of specific performance, it was incumbent upon him to tender performance upon the date fixed, unless such date of performance had been previously mutually waived. In such case, he was bound also to keep his tender good at all times. This latter condition was not essential to his right to maintain an action for damages. If he had adopted that remedy, he would have been excused from making tender to any extent. That is, he could have abandoned the contract, and sued for his damages forthwith.Thompson v. Yousling, 196 Iowa 363. Inasmuch as specific performance has been refused to the plaintiff, we are not concerned over the sufficiency of his tender as a condition to the specific performance. For the *Page 1085
purpose of damages, we are only concerned with the question as to who first breached the contract. Taking the defendant's own attitude and representation, there was never a day from the date of performance due, that the defendant could perform it. Such was his persistent declaration. Upon a breach of the contract by the defendant, no further obligation of performance rested upon the plaintiff, as a basis for damages. This being so, the defendant is in no position to claim a restoration of status quo on the ground of mutual rescission. The court, therefore, properly dismissed his counterclaim.
Our foregoing reference to an action for damages, as a remedy at law, is not intended to exclude any other possible remedy at law. Whether the plaintiff might resort to the remedy of forfeiture, we do not consider. We hold only that the dismissal of the plaintiff's petition should be without prejudice to an appropriate remedy at law.
On the defendant's appeal, the decree is, accordingly, affirmed. On the plaintiff's appeal, it is also affirmed, as modified herein, and without prejudice to appropriate remedy at law. — Affirmed on both appeals.
FAVILLE, C.J., and ARTHUR and ALBERT, JJ., concur.
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Defendant, Gerald Lamb, was indicted by the grand jury of Jasper County, Iowa, for the crime of bootlegging in violation of section 125.7, Code, 1946. April 21, 1947, defendant, appearing in person and by his attorneys, entered a plea of not guilty. May 28, 1947, defendant filed his "Motion to Quash Indictment and to Dismiss Case." On said date the motion to quash was sustained. On June 2, 1947, the trial court ordered that the defendant be held under the same bail bond and the cause submitted to the next grand jury. The State appeals from above orders. Defendant has not filed a brief and argument on this appeal.
Appellant assigns but one error which is:
"The trial court erred in granting the motion to set aside the indictment charging bootlegging, on any of the grounds as stated in defendant's motion to quash the indictment and dismiss the case."
As stated by appellant in its brief, the sole question raised on this appeal is: *Page 178
"May a trial court set aside an indictment that charges a crime because neither the minutes attached to the indictment nor an agreed statement of facts, used solely in connection with a motion to quash the indictment, are sufficient to warrant a conviction of the defendant?"
At the outset we desire to say that the proceedings and particularly the procedure adopted by the parties concerned are not to be commended or encouraged.
The indictment was regular in form. Attached to the indictment were the signed statements of four witnesses. One is the police officer to whom a bottle of liquor was given by the county attorney who received it from one Art Risse. The other witnesses, including Risse, tell about the same story. The three called defendant, a taxi driver, to take them to a club near Newton. They asked the driver, defendant, to get them some liquor which he did. He delivered it to them and they paid him for it. They kept the bottle of liquor until later in the evening when Risse produced it at the police station. Defendant when arraigned entered a plea of not guilty and the case was assigned for trial.
Thereafter defendant filed his motion to quash and dismiss. In connection with this motion there was filed a "stipulation of fact" entered into by the county attorney and attorneys for defendant, which stipulation was for the sole purpose of the motion. The stipulation sets forth the facts above stated in the minutes of testimony attached to the indictment, the defendant admitting the sale as set forth. In addition, it is agreed that the three witnesses present at the sale, in conjunction with another, agreed to make the purchase for the sole purpose of having the defendant prosecuted. There had been trouble between defendant and the father of the fourth person involved; and the father, another taxi driver, furnished the money for the purchase. It was further stipulated that the testimony of the three boys (witnesses before the grand jury) is the only testimony to prove any issue of an unlawful act on defendant's part.
The motion, in substance, sets forth the following grounds: (1) That under the stipulation, the three witnesses are accessories *Page 179
and there is no corroborating evidence. (2) The defendant is not guilty of a crime, as it appears there was an entrapment and not a willful violation of the law.
So far as the record shows, no specific reasons were given by the trial court for its order. There was simply the record statement that "* * * the court having examined the record and heard the arguments of the attorneys, sustains the motion to quash the indictment and the State excepts." While the appeal is also from the order of June 2d, resubmitting the case to the next grand jury, that question is not argued and we do not consider it.
It will be noted that the question argued here is a very limited one. It assumes that the facts set forth in minutes of testimony are not sufficient to warrant a conviction, nor are the facts set forth in the stipulation.
Section 776.1, Code, 1946, entitled "Grounds for setting aside indictment" provides:
"The motion * * * can be made, before a plea is entered by the defendant, on one or more of the following grounds, and must be sustained:
"1. When it is not indorsed `a true bill' and the indorsement signed by the foreman of the grand jury as prescribed by this code.
"2. When the names of all witnesses examined before the grand jury are not indorsed thereon.
"3. When the minutes of the evidence of the witnesses examined before the grand jury are not returned therewith.
"4. When it has not been presented and marked `filed' as prescribed by this code.
"5. When any person other than the grand jurors was present before the grand jury when the question was taken upon the finding of the indictment.
"6. When any person other than the grand jurors was present before the grand jury during the investigation of the charge, except as required or permitted by law.
"7. That the grand jury were not selected, drawn, summoned, impaneled, or sworn as prescribed by law, except as hereinafter provided." *Page 180
[1] In presenting a motion under section 776.1, matters not appearing on the face of the indictment, but included in one or more of the grounds set forth therein, may be shown by extrinsic evidence. However, an examination of the stipulation of facts herein shows, without question, that none of the grounds set forth in said section is raised therein. We have repeatedly held that an indictment can be set aside only on grounds enumerated in the statute. See State v. Boucher, 237 Iowa 772, 23 N.W.2d 851, and authorities therein cited. Under no conceivable theory is the stipulation of fact in this case proper or competent in a hearing on a motion to quash. While it was agreed to upon the part of the State, this fact does not enlarge the terms of the statute nor increase the authority of the trial court, which exists only by virtue of, and in accordance with, the terms of the statute.
[2] The error assigned on appeal further assumes that the minutes attached to the indictment are insufficient to warrant a conviction. We do not accept this assumption. If the testimony as set forth in the attached minutes of evidence was presented on the trial, with nothing more, no court would be justified in directing a verdict for insufficiency of the evidence. Furthermore, accepting this assumption of the State, still the question thus raised is not one of the grounds set forth in section 776.1. It raises no question other than the sufficiency of the evidence. See State v. Boucher, supra.
[3] If this so-called "motion to quash indictment" be considered as a demurrer under section 777.2, there is still nothing before the court warranting the sustaining thereof. The claim in the motion is that the facts show an "entrapment of the defendant and an involuntary inducement to violate the law" which constitutes a legal defense or a bar to the prosecution. Even assuming this to be true, still the facts showing such "defense or bar" appear only from the stipulation and not from the indictment. Section 777.2 provides that:
"The defendant may demur to the indictment when it appears uponits face, either:
"1. * * * or
"2. That the indictment contains matter which, if true, *Page 181
would constitute a legal defense or bar to the prosecution." (Italics supplied.)
[4] The State urges in connection with the assigned error that any motion to set aside an indictment must be made before a plea is entered. In the instant case, so far as the record shows, the plea of not guilty was still of record at the time the motion was filed. While we question if, under the narrow question raised by the State on this appeal, this question is involved, still in answer thereto we cite section 776.1, supra; State v. Boucher, supra; State v. Stafford, 237 Iowa 780, 23 N.W.2d 832.
For the reasons above set forth the trial court erred in sustaining said motion and the case is reversed. — Reversed.
MULRONEY, C.J., and OLIVER, BLISS, HALE, GARFIELD, MANTZ, and SMITH, JJ., concur.
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432371/
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The plaintiff and defendant were married on the 31st day of December, 1929. At the time of their marriage, the defendant *Page 2
was a widower 51 years of age, and the plaintiff, who had not previously been married, was 48 years of age. The defendant's former wife had died in 1926, and he had two sons, Grif and Jack, who were, respectively, 27 and 14 years of age at the time of the trial. Prior to her marriage the plaintiff had been the principal of a commercial school in the city of Des Moines. The defendant was engaged in the elevator business at Dunkerton in Black Hawk county, Iowa. Following their marriage they lived in the city of Waterloo until some time during the month of March, 1930, when they moved to Dunkerton. The defendant had purchased a home there in order that he might be near his elevator business, and they continued to live in this home until the 8th day of December, 1930, when the plaintiff returned to the home of her parents in Des Moines. Defendant's younger son, Jack, lived in the home with plaintiff and defendant from the time of their marriage until they separated, and his elder son, Grif, lived with them in Dunkerton from September until they separated in December. About a week after returning to Des Moines the plaintiff instituted an action against defendant in the district court of Polk county, Iowa. This action was later withdrawn, and on the 7th day of February, 1931, the plaintiff filed her petition in this case in the district court of Black Hawk county, Iowa. In her petition plaintiff asked for a separate maintenance on the ground that the defendant had been guilty of cruel and inhuman treatment endangering the health and life of plaintiff, that he had failed and neglected to support the plaintiff, and that he ordered the plaintiff to leave their home at Dunkerton, Iowa. It appears that no answer was filed to this petition until the case was reached for trial on the 26th day of August, 1931. On that day the plaintiff filed an amendment to her petition charging the defendant with adultery. To this petition and amendment the defendant filed an answer admitting the marriage, but denying all charges of cruel and inhuman treatment and of adultery. The case was tried and the testimony of a great many witnesses introduced on both sides. On the 26th day of December, 1931, the court entered a decree finding that the plaintiff was not entitled to the relief demanded by her, and dismissing her petition. From this decree the plaintiff appeals. In support of her appeal plaintiff-appellant claims that, under the evidence introduced, she was entitled to a decree of separate maintenance on both the ground of cruel and inhuman treatment and the ground of adultery. We will consider the two grounds upon which plaintiff *Page 3
claims she is entitled to the relief asked in the order as set out by her.
I. In support of her claim that the defendant was guilty of cruel and inhuman treatment endangering her life, the appellant introduced evidence tending to show that the appellee spent some of his evenings away from home while they lived in Waterloo; that he failed to bring the plaintiff from Dunkerton to Waterloo for chiropractic treatments; that he made numerous trips to Waterloo and was out late at night; that he neglected to take the plaintiff to places of amusement or to provide her with entertainment; that he would not talk to plaintiff socially and would answer in a sullen, cross manner; that he was guilty of various acts of incivility such as leaving plaintiff and some company at the luncheon table and going with another man to Waterloo, refusing to help appellant wash dishes, refusing to allow appellant to drive his automobile, and going on fishing trips without inviting the appellant to go along; and, finally, that he ordered the appellant to leave his home on the day that the parties finally separated.
In regard to the appellee's absence from home in the evening while living in Waterloo, appellant testified: "He was out a good many evenings. I never recall he was out later than 11 o'clock. He would say some man had been at the elevator but he couldn't go into details. He was going to meet him down town in the evening and go over the matter." In answer to these charges the appellee testified that his absence from home in the evenings was due to the fact that he was operating an elevator at Dunkerton and was installing some new grinding machinery which took him away from home during some of the evenings. In connection with her complaint that appellee failed to take her to Waterloo for chiropractic treatments, she testified: "I had neuritis during a portion of the time that I lived in Dunkerton that I was hardly able to cut bread with my right hand. I came to Waterloo and took some electric and chiropractic treatments from Dr. R.D. Thompson. He said my husband ought to bring me in twice a week for treatment. I told him (appellee) about this neuritis and that I had a very bad cold, but he made no reply. He made no provision for my being brought over, nor did he make any excuse for not doing so. I came with my neighbors. My physician said that I did not come often enough to get results. I transmitted this information to my husband, but he said nothing, and he made no provision for me." The appellee meets this with a denial of the charges and says that he never knew that *Page 4
his wife was taking medical treatments while they lived at Dunkerton; that she never informed him of the treatments taken from Dr. Thompson and never asked him for money to pay doctor bills. To appellant's charge that appellee did not take her to places of amusement or to Waterloo when he went there, appellee responded by denying the appellant's charges and stating that there was hardly a Sunday but what they were some place until he got sick; that he went to church nearly every Sunday; that he visited her relatives with her; that after they moved to Dunkerton he came to Waterloo about twice a week to visit his doctor; and that she came with him most of the time. The charge that the appellee made numerous trips to Waterloo and was out late at night was met by the appellee by stating that he was under treatment by Dr. Butts, that he had about two treatments a week on Wednesday and Saturday, that he came at nights because he looked after the elevator during the daytime, and that he usually got there about 8 o'clock because the doctor did not get to his office until that time. Appellant herself testified that on an occasion when he was out late and claimed to have been attending a Masonic meeting, she talked to her husband about going over to Waterloo and about the lateness of the hours he was keeping, and he said that he had been to a Masonic lodge and that by the time he got refreshments and got out to Dunkerton it was pretty late. She also said that on the occasion of an American Legion convention at Dunkerton, when he was out until about 11 to 12 o'clock, and she was alone and had to hunt up company among strangers, before he went back downtown he agreed to meet one Elmer Gallup, and appellee testified that he had a transaction which he closed up with Mr. Gallup that night and that he got home at 11 o'clock. As to the appellant's charge that the appellee did not talk to her socially and when spoken to by her answered in a sullen manner, we have searched the record and do not find that the appellee was questioned in regard to this matter either on direct or cross examination. However, appellee's son Grif Agnew stated that he never saw any trouble between his father and Mrs. Agnew during the period that he lived in the home, and never heard his father speak harshly to her.
With the single exception above referred to, practically every one of the charges made by plaintiff, which we have thus far considered, was either denied or explained by the appellee. All of the testimony of the appellant, in regard to these matters which we have thus far considered, was without corroboration. On the other hand, *Page 5
the testimony of the appellee as to his visits to his doctor at Waterloo were corroborated by Dr. Butts. It is quite apparent, moreover, that none of the above matters of complaint made by the appellant was considered by her as of a very serious nature. In her testimony she says that she was not suspicious of the appellee until about November 5th, when she started to keep track of how late he was out by marking it down in a book; she says, "My purpose in marking it down in the book was I just thought I would have a little talk with him about this one of these days about what he meant by all this and he would not know whether he had been out or not. My thought was not to ask for a divorce or separate maintenance but I was just going to call his attention to it and ask him if that was the way to fulfill the promise he had made me. I had no thought of separation at that time. In fact I did not until the day I left and what happened prior was not the cause of my leaving." Moreover, it is quite doubtful whether any of these matters already referred to, or all of them in combination, would be sufficient to constitute cruel and inhuman treatment, and it is quite obvious that they would not meet the requirement of the statute that cruel and inhuman treatment, in order to constitute a ground for divorce or separate maintenance, must be such as to endanger life.
The most serious charge made by the plaintiff, in support of her ground of cruel and inhuman treatment, is that on the occasion of their separation the appellee compelled her to leave the home. Her version of what occurred on this occasion is as follows:
"The last Sunday I was in Dunkerton I was sick in the morning, but I went to Sunday School and came home and prepared dinner, but couldn't eat anything for I had a sick headache. I was on the day bed until about six o'clock. Mr. Agnew was there all afternoon but he did not speak to me. He got supper when the little boy came in and asked for something to eat, and after they started to eating he called out and said, `Supper is ready,' and I said I couldn't eat anything. I went to bed about nine or ten o'clock. He did not ask me about my headache. The next morning he did not speak and that evening he told me about leaving.
"Q. Tell the Court about the matter of that conversation, what it was he said to you at that time? A. Well, this Monday evening I had — I was sitting at the table finishing the weekly patching, and he retired, I think about nine o'clock, maybe a little before. *Page 6
While I was still doing this patching Griffith came in, he sat down and talked with me about some argument he had about boy scout work up town, we chatted and laughed there a little bit, and I finished up my work and retired also. Mr. Agnew asked me when I came in if Griffith was in the sitting room, I said he was when I came in, and in a little while, oh perhaps ten minutes, I heard Griffith come in the bath room and start up stairs, then Mr. Agnew got up and went in the bath room and looked out in the sitting room, and came back to bed, and he then said to me, `Well, Minnie, you and I are not the two to be married, and the quicker you get out of here the better off we will both be'. I said, `Well, I have known for some time that things weren't just right here, but I didn't know what was the matter', I said to him I thought the principal thing here was to get along with Jack and I have done that, and I called his attention to work I had done about the house, work I never had done, like putting on screens and cleaning basements and things like that. He said he hadn't any fault to find with the way I had gotten along with Jack, and had no fault to find with the housekeeping but he had this feeling against me and I asked him if he could tell me what I had done that made him feel this way, he said he didn't know, it hadn't all come on at once, but he said he had no fault to find with the way I kept up the work, and he went on talking, wanted to know if I could get out of there by noon the next day. I said I would go now if I could, but I have a lot of furniture here, the dining room furniture I bought and paid for, besides a lot of personal articles of my own, and he said he would see if he could get a truck to send it by noon and he would pay me for my furniture, and we went ahead talking about that, and so when morning came I got up then and dressed.
"Q. And what time was it when you got up and dressed? A. It was between twelve thirty and one o'clock and commenced to pick up books and personal things that I had there, then when daylight came I went to Mrs. Perry to get her to help me pack."
The appellee's version is as follows: "She had a sick headache on Sunday before she left and was on the day bed all afternoon and I stayed in the room and read. I never left the room and when supper time came I went out and got something to eat and asked her to eat. She said she wasn't feeling well enough, that she was too sick and did not want anything. So the boys came out and we *Page 7
ate. She went to bed while we were eating and we did up the dishes and put the stuff away, and about nine o'clock I went to bed. I asked her how she was feeling and she did not answer. She was asleep. The next morning when I got up I asked her how she was feeling and she said her head did not ache but she felt dizzy. That was on Monday morning. We had our breakfast and I went to the elevator and was home for dinner. I came home that evening and went to bed early. I wasn't well. I went to bed possibly about eight o'clock. A little later I heard Grif come in and I heard them talking out in the room. Soon Grif went up to bed and then Minnie came in. She got in bed and started in saying `I don't like the way you acted Sunday.' I said `what did I do.' She said, `when you were sick I did everything for you. When I was sick you didn't do anything for me.' I said `there wasn't much I could do for you. I got supper.' She said `besides you let Jack and the boys run through the room and make all kinds of noise.' I said `I didn't know they was making noise, why didn't you say something about it and I would have stopped them.' She said, `Well, if you wanted to stop them you could without me saying so.' She said that while her folks were up last fall that Dr. Buckmaster and I went away to a ball game and I never asked to be excused, and I said, `No, I guess I didn't probably.' She said `besides you went fishing several nights until nine or ten o'clock.' I said `you never said anything about it at the time, why didn't you say so if you didn't want me to go fishing.' She said, `Well, you know very well I didn't want you to go.' She says `Every time I went to Des Moines I hated to come back.' I says `Why?' She says, `I never felt like I was one of the family, that is the reason I never brought my furniture from Des Moines up here.' She said she was going out in the room to get warm. She went to the room and in about half an hour I went out and said `You better come back here, you will catch cold,' and she said `No, I am going to stay here, I am cold.' I thought she meant it and went back to bed. I stayed all night and she did not come in until the next morning about six o'clock and she said `I suppose you had a nice night's sleep.' I did not answer. I thought she might go on and get breakfast and forget about it but instead of that she put on her coat and hat and I said, `where are you going?' She said `I am going to get Mrs. Perry to help me pack up my things.' I got up and started breakfast and called Grif and told him what happened and we ate our breakfast. She said to me, `can you get a *Page 8
truck to take my stuff to Des Moines today?' I said `Minnie, you better wait a few days, you might change your mind,' and she said `No, sir, I am going and going today.' She then asked Grif if he would get a truck and he said he would. She said the dining room stuff I could use. I said, `I suppose if you are bound to go I will have to have one, so I will give you a check for it.' I told her I would also like the drapes but she said she was going to take them with her. I told her I would give her a check for the dining room suit but she told me if I did I would probably stop payment on the check. I told her that I had never done anything like that. She told me she would rather have the money so as soon as the Bank opened I got it and gave the money to her, amounting to $139.50. I counted it out and she said there was a mistake, it was $140.50, so I reached into my pocket and handed her a dollar. She said `you people have to get dinner downtown, I won't have time.' She asked me what I was going to tell my sister Lela. I told her I was going to tell just what happened. She went into the bed room and I went to the elevator, and that was the last I saw of her until the day of the trial."
Grif Agnew was a witness as to some of the things that happened on the Sunday before and on the morning of the day appellant left Dunkerton, and said:
"I was there Sunday before she went away. She was lying on the day bed in the dining room that Sunday. Father prepared the meals. I do not remember that she ate dinner or supper. Father prepared supper. He got the supper ready. He called Jack and I to come and eat. He asked Mrs. Agnew if she would come for some tea. She said she did not want any and that she was going to bed. I discovered nothing unusual from that time until she left.
"Q. Will you state to the Court the circumstances under which she left that morning? A. Father called me in the morning to come to breakfast, I got up and came down stairs and he told me that —"
We object to any conversation with any person unless the plaintiff herself was present at the time, being hearsay and incompetent.
"A. Well, he told me that she got mad and was going home, she had gone down to Mrs. Perry's to have her come and help pack their things."
Move to strike the answer as incompetent and self serving declarations on the part of the defendant. *Page 9
"We ate our breakfast and were just ready to leave for the elevator when Mrs. Agnew came in. She asked father if he had gotten her a truck to take her things back and he told her she ought to wait a few days and think it over, that she might change her mind and not leave. She said she was going that morning and she turned around and asked me if I would get her a truck. I told her I thought I could get her one and she said all right. She turned around and told my father she did not want the dining room set and curtains and wanted to know if he would pay her for them and he said he would give her a check, and she said if you do I suppose you will stop payment on the check, and he said he never had done anything like that, and he said he would give her the money. He was up at the elevator when the Bank opened and went down and got the money and took it to the house."
The appellee's version of this affair is corroborated by his son Grif Agnew, while the appellant's version is not corroborated by any witness to the actual occurrence. Appellant has introduced, in support of her version of the matter, the testimony of witnesses to the effect that prior to this occasion she had made arrangements to take part in some holiday activities, that on the morning of the separation she went to the homes of the witnesses and told them that she could not take part in these activities, and told them of what had happened, and that she was crying and appeared to be nervous and excited at the time. It is quite apparent, however, that the circumstances of the appellant's suddenly canceling her arrangements to take part in the holiday activities and the fact of her crying and her apparently nervous condition are not sufficient to constitute corroboration of her testimony concerning what occurred between her and the appellee. In the case of Perry v. Perry, 199 Iowa 685,202 N.W. 572, 573, in which the plaintiff, who was the husband, claimed to have been assaulted by his wife, the plaintiff testified as to the details of the alleged assault and his father testified as to seeing blood on the son's head which the son claimed was caused by the assault. In discussing this testimony of the father we said:
"This testimony may corroborate the condition of his head, but it is not corroboration of the essential fact that the defendant was responsible for the condition." *Page 10
See, also, Hummel v. Hummel, 200 Iowa 1176, 206 N.W. 115.
The testimony shows quite conclusively that there was no serious disagreement of any kind between these parties up to the night before they finally separated. Aside from the charge that appellee ordered her to leave the home, the things of which appellant complains prior to the occurrence immediately preceding the separation are matters which she herself apparently did not consider seriously and which, if true, would not be sufficient to establish cruel and inhuman treatment. It appears without dispute that the appellee gave her a check book on his checking account at the bank and that neither he nor the bank ever placed any limitation on the amount or purposes for which checks might be drawn by her. It appears, moreover, that within a few days after going to the home of her parents in Des Moines, the appellant instituted an action against the appellee in the district court of Polk county, and that appellee, with his attorney, went to Des Moines and consulted her attorney in regard to appellant returning to the home of appellee. In her testimony concerning this she said: "I never offered to go back after leaving, as I never had any word from Mr. Agnew. Mr. James called me at one time and said that Mr. Agnew and yourself were in the city and he said that Mr. Agnew said if I wanted to come back all right, and I said to Mr. James what is the proposition and he said none at all, he wouldn't make any promise. I expected him to promise to be home in the evenings. I did not submit any terms as to the basis on which I would return. If Mr. Agnew had been willing to talk things over with me and had promised to treat me decently I might have come back. I made no attempt to have a conference with him because I thought after he had driven me out he certainly did not want me there."
The promptness with which the appellant left the home in Dunkerton following their conversation just prior to her departure, and her apparent indifference to a possible reconciliation, arouse at least a suspicion that appellant was not reluctant to leave the appellee's home and was not anxious to return. The physical ills and nervousness of which she complains are far from being necessarily connected with any misconduct on appellee's part, even if such misconduct were established. The evidence shows quite clearly that the appellant had suffered from neuritis prior to her marriage, and that during much, if not all, of her married life, she was taking treatments for her physical ills. Moreover, although it is denied by *Page 11
her, it seems quite possible, if not even probable, that the bodily ills and nervousness from which she was suffering may have been due to a physical condition quite common to women at her time of life. Instead of being the effect of any cruel and inhuman treatment on the part of appellee, it is quite possible that appellant's nervousness and physical condition may have been the cause of her readiness to discover a grievance and leave the appellee's home. In view of the trivial nature of many of the things of which appellant complained, and the utter lack of corroboration as to any act of cruel and inhuman treatment committed by the appellee, we are unable to see how the appellant has established her right to separate maintenance on the ground of cruel and inhuman treatment on the part of appellee such as to endanger her life.
II. The charge of adultery brought by the appellant in her amendment to her petition is based upon illicit relations which she claims the appellee had with one Mrs. Champlin. These illicit relations are claimed to have occurred during the months of May to August, inclusive, 1931. The acts of adultery of which appellant complains are alleged to have occurred at the Agnew home in Dunkerton and at the apartment of Mrs. Champlin in Waverly. The evidence upon which the alleged illicit relations between appellee and Mrs. Champlin at Dunkerton are based consisted of the testimony of neighbors as to the visits of some woman to the Agnew home during the month of May, 1931. There were eight such witnesses, who were all members of families living in the immediate vicinity of the Agnew home. Of these eight witnesses not one of them positively recognized Mrs. Champlin as the woman whom they claim to have seen visit the Agnew home. Some of these witnesses were unable to give any opinion as to the identity of the woman who visited the Agnew home, and some testified that she appeared to be of the same height and build as Mrs. Champlin. Only two of them would go so far as to say that in their opinion the woman who visited the Agnew home was Mrs. Champlin, but neither of them would go so far as to make a positive identification. These visits to the Agnew home are alleged to have occurred approximately every other evening during a period of from two weeks to about a month. All of the witnesses admit that there was nothing secret about these visits, and no apparent attempt at concealment. Many of these witnesses refer to the fact that Mr. Agnew had been sick and was supposed to be sick at this time. One of these witnesses had heard a *Page 12
telephone conversation earlier in the day in regard to some woman coming to visit the Agnew home that evening, and he testified that out of curiosity he watched to see if the engagement was fulfilled, and that the woman arrived promptly at the hour arranged, which he thinks was a quarter to 7 or 7 o'clock in the evening. He had told his wife about this telephone conversation and she was also with him when the woman visitor arrived at the Agnew home. Neither the testimony of these witnesses, nor the testimony of any of the witnesses, indicates that there was any thought on their part that any improper relations were being sustained by the appellee and the woman who called upon him. The arrival of the visitor was placed by these witnesses anywhere from 6:30 to 7:30 in the evening, which, during the month of May, would be in broad daylight. The car in which the visitor arrived was stopped in front of the Agnew home, and the visitor, as some of the witnesses expressed it, "tripped up the sidewalk" to the front porch. Sometimes Mr. Agnew and his visitor sat on the front porch, sometimes they went into the house, and sometimes they were in the yard. While some of these witnesses claim that Grif Agnew went up town or was away from the home on the occasion of these visits, others admit that he was present at least during a part of the visits. None of these witnesses testified to these visits continuing later than about 9:30. The time and circumstances of these visits would themselves tend to indicate that, instead of their being anything wrong connected with them, they were entirely innocent. If there had been anything suspicious about these visits, it is not only possible, but quite probable, that the curiosity of these neighboring witnesses would have been sufficiently aroused that they would have been able to positively identify her. Even the witness and his wife, who watched for the visitor after having heard the telephone conversation fixing the time of her arrival, were not sufficiently interested to be able to identify her, and, so far as the record shows, these visits or anything connected with them did not so much as furnish a topic for the neighborhood gossip of this little town.
The evidence as to what occurred at Waverly is to the effect that from some time after the first week of June, until about the middle of August, the appellee spent much of his time in an apartment occupied by Mrs. Champlin in Waverly. There is evidence that the plaintiff rented a room in Waverly, which was not in the same house as Mrs. Champlin's apartment; that in mornings he *Page 13
would go to the apartment of Mrs. Champlin, take her back and forth to work, and remain there most of the day and until 9, 10:30, or 11:00 o'clock at night; that Mrs. Champlin was working in the daytime; that during the time Mrs. Champlin was at work he would sometimes sit on the porch and sometimes in her apartment; that he brought bundles to the house which were supposed to be eatables, and assisted Mrs. Champlin in washing the dishes; that during the time that he was spending his days and evenings in Mrs. Champlin's apartment, a fourteen-year-old daughter of Mrs. Champlin was there two or three times and remained a couple of weeks at a time; and that the appellee's son Jack was also there during a part of the time. The lady from whom Mrs. Champlin's apartment was rented testified that the period during which he came to this apartment was from about the first of June until the middle of August; that she understood he was ill and was supposed to be resting; and that he would be gone on different occasions two or three days at a time. The lady from whom the appellee rented his room testified that the appellee took this room about the second week in June, and that he went home on Fridays and Saturdays.
The appellee admitted his presence at Mrs. Champlin's apartment in Waverly. He and his son Grif both explained his presence there by saying that he was sick and was unable to work; that he needed certain kinds of food; that they were not able to properly cook this food at their home in Dunkerton; that Mrs. Champlin was a friend of Grif Agnew and had volunteered to cook for appellee in her apartment if he would take a room in Waverly.
Both appellee and his son Grif positively deny that Mrs. Champlin ever visited the Agnew home in Dunkerton, and say that the woman who was seen visiting the home was a lady friend of Grif's. The fact that the appellee had suffered a stroke and was in poor health during all this time from April to August is not only testified to by the appellee and his son, but is corroborated by Dr. Butts, a reputable physician of Waterloo, and is also corroborated to a considerable extent by the testimony of the witnesses for the appellant. The time spent by appellee in Mrs. Champlin's apartment in Waverly and his conduct while there were open and without any apparent attempt at concealment. The witnesses at Waverly, like those at Dunkerton, did not testify to any particular circumstance which aroused their suspicions that there was any wrongful relation between the appellee and Mrs. Champlin. The appellant's *Page 14
action was pending during all this time and the trial began on the 26th day of August, and, if the relations between appellee and Mrs. Champlin had been wrongful, it seems quite reasonable to conclude that they would at least have made some effort to keep their associations secret.
It is well established by the decisions of this court that the mere opportunity to commit adultery will not justify the inference of guilt. In Anderson v. Anderson, 197 Iowa 383,197 N.W. 300, 302, where a wife had left her husband and gone to keep house for another man, we said:
"BeDillion is a widower 53 years of age, with no children living with him. He has worked as a railroad brakeman, has been on the police force, and of late years has been employed as a laborer. He is not shown to have any property or means of livelihood except his labor. It doubtless is unusual for a man in his situation to maintain a home and hire a housekeeper, and yet the admitted fact that defendant was living in his house in that capacity under all the circumstances disclosed is neither so contrary to human experience nor so inconsistent with innocence as to sustain a finding that their relations were adulterous. The mere fact of her living there in that capacity does not establish her guilt. It is a situation which, as has been said, society condemns, and one likely to provoke criticism. Fisher v. Fisher (Iowa) 182 N.W. 803. But without more it is not sufficient to establish adultery. Mere opportunity, without evidence of the will or disposition to take advantage of it, will not justify the inference of guilt."
See also, Aitchison v. Aitchison, 99 Iowa 93, 68 N.W. 573; Wells v. Wells, 116 Iowa 59, 89 N.W. 98; Inskeep v. Inskeep,5 Iowa 204.
In our opinion the evidence in this case is insufficient to establish the ground of adultery alleged in plaintiff's amendment to her petition. — Affirmed.
KINDIG, C.J., and EVANS, STEVENS, ALBERT, and CLAUSSEN, JJ., concur. *Page 15
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432378/
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[1] Appellant is the executrix of the estate of her deceased husband, William Kantor. She commenced an action in the district court of Woodbury county, Iowa, against the appellee insurance company to recover permanent disability payments of $50 per month for the last six months of decedent's life and the sum of $240.95 paid by decedent as premium on his policy of insurance during said period, or a total of $540.95.
The petition alleges that on the 29th day of January, 1930, the appellee issued a policy of insurance to William Kantor on his life for $5,000, and that said policy contained a provision for the payment of disability benefits of $50 per month and a waiver of the annual premium payments which became due after the insured became permanently and totally disabled under the terms of the policy. It is further alleged in the petition that William Kantor became totally disabled on the 27th day of July, 1933, and continued permanently disabled until his death on the 3d day of February, 1934; that on the 29th day of January, 1934, he paid to the appellee company, as premium on his policy of insurance, the sum of $240.95; that the plaintiff was appointed as executrix of his estate on the 17th day of February, 1934, and immediately notified the appellee company of the disability which had existed and filed, or offered to file, proofs of such disability, and the company refused to receive such proofs.
A demurrer was filed to the petition on the ground that there was failure to submit proof during the lifetime of the insured and there was a failure to show at the time the proof was submitted that the disability would continue during the lifetime of the insured. *Page 1007
The question we are thus called upon to determine is whether, under the provisions of the policy, the representative of the insured's estate can file proof of permanent and total disability for a period preceding the death of the insured and receive the benefits to the same extent as the insured could have done had he lived, where the insured was capable of filing proof but did not do so, and the insurer was in no manner notified of any disability on the part of the insured during his lifetime. This involves a construction of the insurance policy.
[2] An insurance policy is a contract between the insurer and the insured, and must be interpreted like other contracts. The object of all efforts at interpretation is to arrive, if possible, at the intention of the parties. To that end certain rules have come to be recognized as an aid to the court. The court will look to the whole instrument in an effort to determine its meaning; it will consider the purposes sought to be attained by the contract as shown by the instrument; and, if words be ambiguous, they will be construed against the party who prepared the document. It is frequently said that insurance policies will be liberally construed in favor of the insured. This is probably only another way of saying that the objects and purposes of the contract will be kept in mind and ambiguous language will be construed against the insurer who prepares and issues the contract. It certainly does not mean that the courts will prepare a new contract of insurance or are at liberty to change in any way the contract which was made by the parties.
The policy in this case is primarily one of life insurance. It provides that, in event of the death of the insured, the insurer will pay the sum of $5,000 to the beneficiary named therein, who is the wife of the insured. The essential difference between life insurance and disability insurance is obvious. The object of life insurance is to provide a fund for the benefit of the estate or the heirs or beneficiaries of the insured after the insured's death. The purpose of disability insurance, on the other hand, is to protect against, not a loss of life, but a loss of earning capacity. Disability insurance protects the insured himself; life insurance is primarily for the protection of others. Disability payments are, therefore, payable to the insured; life insurance benefits go to others.
With these general observations in mind, we proceed to an examination of the policy itself. It provides that the appellee company shall pay to the wife of the insured the sum of $5,000"upon *Page 1008 receipt of due proof of the death of William Kantor, theinsured". It further provides "upon receipt of due proof that theinsured is totally and presumably permanently disabled before agesixty, * * * the company agrees to pay to the insured fiftydollars each month and to waive payment of premiums as providedtherein." It will be observed that, while death benefits are to be paid to another under the terms of this policy, the provision is that the disability benefits are to be paid to the insured. This illustrates the difference in the two classes of insurance and in their objects and purposes, as we have tried to indicate in the foregoing paragraph; and it shows that the parties contemplated a payment of the disability benefits to the insured himself. It will further be noticed that the face of the policy (the death benefit) is payable if the proof shows the insured isdead, and that the disability benefits are payable if the proof shows he is disabled.
With respect to the proof which must be furnished to the insurer before the disability payments are to be made, the policy further provides that "disability shall be considered total whenever the insured is so disabled by bodily injury or disease that he is wholly prevented from performing any work"; that the company will waive premium payments and will pay certain monthly benefits "upon the receipt at the Home Office before default in payment of premium, of due proof that the insured, is totally disabled as above defined and will be continuously so disabledfor life"; that, in the event of default in payment of premium, the policy will be restored, "provided that due proof that the insured is and has been continuously from the date of default so totally disabled and that such disability will continue for life
or has continued for a period of not less than three consecutive months, is received by the company not later than six months after said default"; that "before making any income payment or waiving any premium, the company may demand due proof of thecontinuance of total disability."
It will be noted that the language of the policy above quoted provides that the appellee company is to pay the disability benefits upon receipt of due proof that the insured is totally disabled and will be continuously so disabled for life. It is further provided that, before making any payments, the company may demand proof of the continuance of total disability. It is obvious that proof furnished after the insured has died does not establish that the insured is permanently disabled and will be
permanently disabled for the remainder *Page 1009
of his life. Moreover, in such a situation, the insurer could not demand proof of the continuance of such disability. These provisions of the policy cannot be reconciled with the proposition that there is an obligation on the part of the insurer to pay disability benefits to the representatives of the estate of the insured after the death of the insured and upon proof furnished by the representatives of his estate that before his death the insured had been disabled, although no proof of such disability or even notice thereof was ever given to the insurer. The proof thus furnished by the representatives of the estate would show the death of the insured. The insurer's obligation on receipt of that character of proof was to pay the sum of $5,000 to the beneficiary. That payment, it made. Its obligation to pay disability payments and waive premium depended upon receipt of proof that the insured was living, that he was in being, that "he is permanently disabled" and "he will continue to be permanently disabled". Such requirements of the contract are not met by proof that the insured is dead.
The exact question here for our determination seems not to have been the subject of judicial consideration by a court of last resort. An inferior court in the state of New York had this identical question before it under a policy of insurance very similar to that in the instant case, and reached the conclusion that the insurer was not liable. See Yohalem v. Columbian Nat. Life Insurance Co., 136 Misc. 748, 240 N.Y.S. 666.
We have had for consideration in a number of cases the interpretation of a provision for total and permanent disability in a policy of life insurance similar to the provision in the instant case. But the decision in those cases do not affect the question here being considered. In McCoy v. New York Life Insurance Co., 219 Iowa 514, 258 N.W. 320, we held that, where the insured became insane, he was entitled to the benefit of the provision for a waiver of premium, even though he did not file proof of such disability. But that holding was based entirely on the fact that the insured became insane, and therefore incapable of filing proof. It proceeds upon the theory that the insurance company should not be permitted to escape responsibility, so far as the waiver of premium is concerned, where the insured suffered total disability which was so complete that the insured was unable to furnish the proofs. That case assumes that the parties intended, and the policy therefore meant, that the proofs were to be furnished only when the disability, *Page 1010
the consequences of which the insurance company had insured against, was such as to permit proofs to be filed, and that the parties did not intend that such proofs must be filed where the disability was such that the insured could not possibly furnish them. There was no effort in that case to recover the monthly payments. Whether or not the same rule would apply to the monthly payments has therefore not been determined. But no question of the ability of the insured to furnish proof is involved here. There is no claim that the insured, by reason of his disability, was rendered incapable of furnishing proof if he had desired to do so. Therefore the case of McCoy v. New York Life Insurance Company has no application here.
Because of the reasons hereinabove set out, we reach the conclusion that the proof furnished or offered to be made by the representatives of the estate of the insured was not such proof as the policy contemplated. No excuse for the failure to furnish proof during the lifetime of the insured is pleaded. Whether disability so complete as to make it impossible for the insured to furnish such proof, as complete loss of mind, would excuse the filing of proof, is therefore not before us. The trial court committed no error in sustaining the demurrer to the petition. — Affirmed.
ANDERSON, C.J., and MITCHELL, HAMILTON, and PARSONS, JJ., concur.
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432374/
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Ida L. Hann and Frank W. Hann, appellee herein, were wife and husband, and Vern H. Hann, appellant, was their son. Ida L. Hann died on the 31st day of January, 1924, and the will in controversy was duly probated on March 4, 1924. 1. WILLS: undue This action was commenced on the 2d day of influence: February, 1925, to set aside probate and declare rule of the will void on the ground of mental incapacity sufficiency. of the said Ida L. Hann, and undue influence exercised over her by her husband, Frank W. Hann. Two motions were made at the close of plaintiff's testimony: The first, to withdraw from the consideration of the jury the question of undue influence, on the ground that there was no evidence to warrant submission of such issue to the jury; the second, to direct a verdict for defendant, the substance of which was that there was not sufficient evidence to go to the jury on the question of mental incapacity of the said Ida L. Hann. Both motions were sustained by the court, and judgment entered accordingly. It is the rulings on these motions that are assigned as errors. Other assignments of error go to the question of admission or rejection of testimony. *Page 809
The first question discussed is the sustaining of the motion withdrawing from the consideration of the jury the question of undue influence.
The quantity of evidence necessary to take this issue to the jury has been a question of extended discussion in our former cases. We have definitely fixed these rules, however, in the case of In re Will of Richardson, 199 Iowa 1320, at page 1327, where we said:
"Influence, to be undue, within the meaning of the law, must be such as subjects the will of the testator to that of the person exercising the influence, and makes the written will express the purpose of such person, rather than that of the testator. It is frequently said that it must be equivalent to moral coercion, and directly connected with the execution of the will, operating at the time it is made. Perkins v. Perkins, supra [116 Iowa 253];Parker v. Lambertz, 128 Iowa 496; Henderson v. Jackson, 138 Iowa 326. The person charged with exercising undue influence need not have been personally present when the will was made, but his influence must have been actively operative [citing cases]. Undue influence is not established by proof of opportunity to exercise it and a disposition to do so [citing cases]. Importunity, requests, and persuasion that do not go to the point of overthrowing the will of the testator, are not sufficient to constitute undue influence [citing cases]."
We turn now to the evidence in this case. It is impossible to set the record out in full, because it would make too lengthy an opinion. Among others, the following facts are established by appellant's testimony: Until 1922, the testator was a strong, active woman, and took an active interest in the affairs of life, but in that year she became afflicted with cancer of the uterus. Prognosis of her trouble was bad, and the disease was progressive to the time of her death. In December, 1922, she executed a will, which, in substance, gave to her son, appellant herein, a 240-acre tract of land during the natural life of the son and his wife, and at the death of the survivor, to the children of appellant. The husband owned certain lands in which the testator had an interest, and by will she released to her husband her interest in the lands thus owned by the husband. On January 4, 1923, a codicil was added to this will, by which she confirmed the will and provisions therein, and also devised and bequeathed to *Page 810
the son, Vern, "all her right, title and interest in and to the estate of Mary A. Goddard, deceased, whether this property consist of real or personal property, or whether it be moneys and credits."
On January 4, 1924, she executed the will in controversy, the material part of which is that she gave to the husband, for a period of five years from her death, the use of an 80-acre tract of land, subject to which use by the husband she devised said tract to appellant herein. All the rest, residue, and remainder of her property, of every kind and description, she devised and bequeathed to her husband, Frank W. Hann. She further explains this devise and bequest by saying:
"Feeling that he will make such provision for my son as future conditions warrant, but I want it expressly understood that the provision herein made for my husband is absolute and not in trust."
The relations between mother and son seem to have been friendly and affectionate at all times. We glean from the record the following prominent points that might be considered on this question of undue influence: The will was drawn by the late Judge Cullison on the 4th day of January, 1924, 27 days before the death of the testator. The husband, Frank W. Hann, called Judge Cullison to the home to draw the will, and was present in the room when the same was executed by the testator. There is no evidence whatever that Frank Hann had anything to do with the preparation of the will, or in any way dictated the terms or provisions thereof.
Dr. Bocken was testator's attending physician. He began treating her December 6, 1922, and continued so to do until the time of her demise. He testifies to the progressiveness of the disease, wearing of the disease on the system; that the disease carried with it a toxic effect which affected the blood and would affect the organs of the body. He said that toxin in the blood would injure the brain and be detrimental to it; that at times he observed testator in a stupor, and she suffered pain, and morphine was administered to her whenever she needed it, to quiet her. As the disease progressed, he noticed a yellowish color, and there was loss of flesh and loss of weight. He testifies further that disease of the female organs would be likely to, or probably would, indirectly affect, to some extent, the mind or brain. He *Page 811
was present on the 4th of January when the will was made, and signed the will as a witness, although he said he did not know it was a will. No other witness testifies who was present at the time the will was made, Judge Cullison having died in the interim.
These are the high points in the testimony on the question of undue influence. Measured by the rule we have heretofore cited inIn re Will of Richardson, 199 Iowa 1320, this was not enough to take this question to the jury. While it is true that, under some circumstances, undue influence may be proven circumstantially, as well as by direct testimony, yet we do not think that this is a case for an application of the rule permitting proof by circumstantial evidence. It will be noticed that the principal point here was that the husband was present in the room at the time the will was drawn. This fact cannot weigh very heavily, because, as husband of the testator, his presence in the room at the time the will was drawn does not bear very much significance. The fact also that she had previously made a will, giving the larger part of her property to her son, and by the last will materially reduced the bequest to the son, cannot be said to be very persuasive on the proposition of undue influence. It is, of course, a circumstance to be considered, with the other circumstances in the case, on the question of undue influence. Taking these facts, with the fact that the relationship between the mother and son was always friendly and affectionate, and also taking into consideration the evidence of her physical and possibly weakened mental condition, we do not think that there was enough to take this case to the jury; and the court was right in withdrawing the issue of undue influence from the jury.
The other question raised is whether or not the court was warranted in directing a verdict in favor of appellee on the question of mental incapacity. This is always a troublesome question in cases of this character. Some 2. WILLS: controlling questions must be determined before testamentary we give attention to testimony on this question: capacity: The attending physician, whose testimony has opinion been heretofore referred to, at no places evidence: testifies directly that the testator was of usurping unsound mind at the time of the making of this jury will. There was a series of questions asked of function. this witness and also of each the other witnesses on the part of appellant, to which *Page 812
due objection was made at the time, and in most instances, the objection was overruled by the court; and to these we give attention. The questions referred to the time of the making of the will. The doctor was asked whether this woman had sufficient mental capacity to understand and comprehend the nature of the act of making a will, and the effect that the will would have upon her property at her death; also, whether she had sufficient mental capacity to understand and know the effect that the will would have upon her property, if she should make one; also, whether she had sufficient mental capacity to know and comprehend the effect of a will upon her property after her death; also, whether she had sufficient mental capacity to comprehend and realize her property, and know the extent of her property; also, whether she had sufficient mental capacity to comprehend and realize the natural objects of her bounty and the duty she owed, if any, to the natural objects of her bounty. The objection to each of these questions should have been sustained. Each question went to the very question the jury had to decide. The last time we had this question before us, as we now recall, was in In reWill of Jahn, 184 Iowa 416, where this question was elaborately discussed, and it was held that all questions of this nature were inadmissible, and that to admit answers to them was prejudicial, even though they came from a physician. To permit the witness to answer such a question is an invasion of the province of the jury, and leaves nothing for the jury to decide. The usual and ordinary form of this question is to ask the witness whether or not, in his opinion, the testator, at the time, was of sound or unsound mind. In the consideration of this case, we therefore will exclude from our consideration the testimony of all witnesses where they were permitted to answer the above question or questions of a similar character.
In addition to what has already been referred to in the testimony of Dr. Bocken, he says:
"During the months of December, 1923, and January, 1924, her strength declined. At the latter time, she could not get out of bed alone, and could only reach a sitting position by assistance of someone. In January, 1924, she seemed apparently as talkative as always, and at other times not so much. I observed her in stupor at different times. She depended on aspirin a great deal, and on morphine to relieve her pain. My direction to the *Page 813
nurse was to administer it whenever needed for the pain. Was called about 2 o'clock on the morning of January 4, 1924. She was sitting in a chair, and I talked to her, and she remarked that she feared to talk death. She said that, if she would lie down, her heart would stop, and that she would die from a heart condition. She was very weak, and could not get her to bed. Gave her a hypodermic of digitalis and strychnine and some morphine, the digitalis and strychnine to relieve the heart, and the morphine to relieve the fear. At times, she would be on her hands and knees in bed, for the simple reason it would be more comfortable for her. I left her sitting in a chair."
On cross-examination, he testifies that he was there at the time of the making of the will; that he examined Mrs. Hann, and told her to continue her treatments; that she talked to him. He was asked, when he concluded, whether she was mentally able to understand these things, and he answered:
"I hadn't given it a thought, at the time, or for months afterwards, because it didn't concern me."
He was asked just how much mental force a person would have to have, to make a will, and he answered, "I cannot answer that."
"Q. Would you have to have as much as to carry on business? A. Yes, sir. Just the same mental capacity as to carry on business. I understand that he would have to be able to carry on a business successfully, in order that he might be capable of making a will. If there was anything wrong with her mental thinking and reasoning, it was because of her physical condition. Q. Just how much physical weakness does a man or woman have to have, before they lose their mental equilibrium? A. I think a state of delirium or delusions. She was not delirious in the afternoon. In a person afflicted with cancer, the toxemia would affect the mind to the extent of delirium and delusions. She had had delusions. The longer the cancerous condition existed, the more toxic it became. It varies as to the location of the cancer and the amount of absorption. Giving of morphine does not affect the mind. The toxemia is an effect on the blood. She had an anæmic condition. Such conditions affect the brain. [The will was made in the afternoon.] She had some morphine in the morning."
William Goddard testified that he saw the testator in December, *Page 814
1923; that she was very weak and thin; that he again saw her in January, about a week before she died; that she was not as talkative as she naturally was.
"I did not talk much to her. There wasn't much color in her face, and she looked thin. She was lying in bed in December, 1923. She seemed very weak, but was not unconscious. Had conversation with her in December, 1923. 3. WILLS: Asked her how she was feeling, and she replied testamentary she was not feeling very well. That was not capacity: all the talk I had at that time. I talked with opinion her at other times. I don't recall what we evidence: talked about. She said nothing about business. non-expert She sometimes made exclamations of pain; cannot detailing recall what she said." physical condition only.
Here followed the series of questions referred to in the former part of this opinion, about the sufficiency of her mental capacity. This witness was a non-expert witness, introduced for the purpose of showing the mental incapacity of the testator. We have repeatedly announced the rule that, under such circumstances, the witness cannot be permitted to give such testimony without first reciting the facts upon which he bases his proposed opinion. Our cases on this proposition have been gathered and commented upon in the case above cited, In re Willof Richardson, and need not be set out herein. More than this, a witness, in attempting to give such an opinion, must testify to such set of facts as a basis therefor as that it may fairly be inferred from such facts that there was mental unsoundness. As applied to the facts of this witness's testimony, each and every fact as to the condition of this woman to which he testifies, refers purely to her physical condition; and none of the facts he recites, nor all of the facts combined, could be the basis even of an inference that her mental condition was not normal.
Mrs. C.H. Dean testifies that she was a graduate nurse, and cared for Mrs. Hann for nine or ten days; that Mrs. Hann was not in very good condition, was white and pale, of a yellowish color; that she was in bed.
"We took her up and put her in a chair, and then back to bed; and she was not up after that. There was quite an odor incident to her disease, and a bad discharge. Gave her opiates according to her pain, sometimes every four hours. She cried some, and was most of the time delirious, and unconscious at *Page 815
times; at other times not. Delirium sometimes lasted half an hour, and sometimes more."
This same set of questions heretofore referred to, as to Mrs. Hann's mental capacity, was asked the witness, but in this instance the objections were all sustained. The witness further testified:
"I went to the Hann place either the 21st or 22d of January, and was there until she died."
She was there after the will was drawn, and her opinion is subject to the same objection as that of the witness Goddard.
Reverend Metcalf, a Congregational minister, testifies:
"First met Mrs. Hann in October, 1923. Was there ten or fifteen minutes. She was yellowish-white color; her eyes were prominent; she was emaciated. Had a conversation with her which was of a generally spiritual nature. Was there several times after that, sometimes every other day. Saw her when she was delirious. She had slight flights of delirium every time I called. She would talk one thing and then another, thinking around, not holding her mind to one subject. She knew what she was talking about, but nothing definite. Saw her in the early part of January. Could not say whether she was in delirium then or not. Am not sure whether I saw her between the 1st and 4th of January or not. Almost sure I did. Her eyes were stars. Observed an odor on all occasions I was there. It is rather difficult to describe her talks. Sometimes they were rather short, and sometimes she would talk of her sickness, hoping to get well, and then she felt she was going."
This witness was then asked the series of questions hereinbefore referred to, as to the mental capacity of Mrs. Hann, and was permitted to answer, over objection. On cross-examination, he says:
"I don't think she was a normal person. Never talked to her about her property. She talked to me about her spiritual condition. She did not go into her business relations. She was very sick, and was not capable of carrying on her business. That is all I do mean."
Vern Hann, appellant, testifies that he was married in April, 1917. Up to that time, he lived on the farm with his parents. Before his mother became sick, she was active and strong, and took care of practically all the business. Before she was taken *Page 816
sick, she weighed around 145 pounds. In 1923 and 1924, the witness stayed at Harlan, and his father and mother came to live with them, where they lived until the date of the mother's death. He was working, at the time, and was home evenings and mornings. His wife worked for the telephone company. She was home mornings, noon, and evenings, and had her meals. On the morning of January 4, 1924, his mother was attacked with shortness of breath. Dr. Bocken was called. He administered a hypodermic. The witness further testifies that the mother was then sitting in a chair, where she had been carried to the door for fresh air; that he ate breakfast about 6:30 in the morning, and went to his work, and was back at noon; that she was still sitting in a chair; that he was there about 30 minutes at noon, and arrived home in the evening about 6:30; that she was still sitting in a chair; that his mother's eyes were very glassy; that in the evening they were very dull. He was then asked the series of questions above referred to, as to her mental capacity, and was permitted to answer. This witness was asked whether or not, in his judgment, the testator, on the 4th day of January, 1924, was of sound or unsound mind, and he answered, "I don't think she was of sound mind." He, being a non-expert witness, and testifying to no facts that in any way indicated the condition of his mother's mind, was not competent to so answer, under the rule we have heretofore announced. On cross-examination, he testifies that what he meant in his answer to the aforesaid question was that his mother was not able to take hold and carry on business.
Mrs. Vern Hann testifies that she was the daughter-in-law of the deceased and the wife of appellant.
"I noticed my mother-in-law was delirious about the 1st or 3d of January. She did not eat much of anything, or care therefor. She would drink a cup of coffee. She was carried to the table in a chair. I remember the 4th of January, when somebody sent for Dr. Bocken about 2 or 3 o'clock in the morning. I observed Mrs. Hann and her breathing. She moaned some in the morning. Observed her countenance, color, and eyes. She had no color in her face; she was kind of greenish yellow, and her eyes were glassy. Picked her up and took her to the door for a few minutes. I left home about 7:45. When I left, Mrs. Hann was sitting in a chair by the register. When I came back at noon, *Page 817
she was still sitting in a chair. I was there about 30 minutes. When I reached home in the evening, she was still sitting in the chair. Her eyes were wally. She seemed awfully nervous."
She was then asked, basing her judgment on what she testified to, whether Mrs. Hann was of sound or unsound mind at these three times (morning, noon, and evening of January 4th). She answered, "I don't think she was of sound mind." She had recited no fact relative to the mental condition of said testator on which she could base this opinion. She was then asked the four questions above referred to, as to the mental capacity of the deceased, and was permitted to answer the same.
Marie Pierce, a nurse who alternated with Mrs. Dean, and who had charge of Mrs. Hann five days before she died, testified that Mrs. Hann was delirious in the daytime and in the nighttime, practically all the time.
"Her eyes were glassy. There wasn't any color in her face. She had a yellowish-white cast. At that time, she was getting morphine every four hours, and more often if needed."
She testifies that she did not think that the testator was of sound mind. This, of course, has to do only with the few days that she took care of Mrs. Hann before her death. She also answered the line of questions heretofore referred to.
This is the sum total of the testimony introduced on behalf of appellant. To our minds, it is not sufficient, after the exclusion of that which was wholly incompetent, to take the case to the jury. The ruling of the district court in sustaining the motion to direct the jury to return a verdict in favor of appellee was right. — Affirmed.
De GRAFF, C.J., and EVANS and MORLING, JJ., concur.
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432375/
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It is alleged that in May, 1921, the defendant-appellant F.C. Klipp, together with A.H. Licht, August Freund, P.V. Dyke, C.J. Pritz, Charles Conrad, Herman Wiebel, William Niermeier, Henry Mente, Otto Schneider, A.J. Charlton, Herman Cassier, Paul H. Kemmann, H.R. Griesbach, Fred Von Roden, Dick Schlueter, L.D. Rixe, George Deininger, D.W. Conrad, L. Hoeltje, Hubert Hoeltje, plaintiffs-appellees, and Charles Reinking and Henry Hoffmeier, "wrongfully, unlawfully, wickedly, and maliciously combined, confederated, and conspired together, each aiding, assisting, and abetting the other, to libel, defame, injure, and destroy (one Henry W. Mowry) in his standing as a citizen and member of the community in which he then lived, and to cause to be withdrawn from him the confidence and association of his neighbors and associates." Both Charles Reinking and Henry Hoffmeier are now deceased, and the plaintiff-appellee Lena Reinking is the administratrix of Charles Reinking's estate, and the plaintiff-appellee Ida Hoffmeier is administratrix of the Henry Hoffmeier estate.
Suit was brought by the said Henry W. Mowry against the alleged conspirators, and judgment was recovered in the district court of Jones County. An appeal from that judgment was taken to this court by the alleged conspirators, which resulted in a reversal. Mowry v. Reinking, 203 Iowa 628. After that reversal, the cause was again tried in the district court, which likewise resulted in a judgment for Henry W. Mowry against the alleged conspirators. This last-named judgment was paid.
For the purpose of defending in those conspiracy trials, the appellant, appellees, Charles Reinking, and Henry Hoffmeier employed attorneys and counselors. These attorneys and counselors were C.M. Dutcher, of Iowa City, Don Barnes and *Page 1073
Otto L. Schluter, of Cedar Rapids, and Park Chamberlain, of Anamosa. The fees of those attorneys and counselors, together with their expenses, amounted in all to $16,427.59. Those attorney fees and expenses were no part of the judgment or costs rendered in the conspiracy case.
Appellees were compelled to pay for those legal services in full. Appellant paid no part thereof. Consequently this proceeding was commenced by the appellees to compel the appellant to contribute his portion of the foregoing fees incurred for the common defense of the alleged conspirators, and, as said in the preliminary statement, the district court rendered judgment accordingly. Of that judgment, however, appellant complains.
[1] I. No exception is taken by appellant to the amount of the attorney fees and expenses, nor does he say that the services were not rendered. His objection at this juncture is that contribution cannot be obtained from him by the appellees because the attorney fees and legal expenses were incurred in defending a tort committed by joint wrongdoers.
In view of the fact that the alleged conspiracy was committed by appellant and the other above-named conspirators, he insists that it would be against public policy to allow a contribution for the attorney fees paid by appellees. To put the thought differently, appellant argues that contributions between joint tort-feasors can not be enforced at law, and in a cause void at law, equity can not give relief. See Horrabin v. City of Des Moines, 198 Iowa 549; Johnson County Savings Bank v. City of Creston, 212 Iowa 929.
Here, however, appellees are not asking contribution from the appellant for the judgment or costs in the conspiracy case. Hence, there is entirely eliminated from the issues here involved a contribution from a joint wrongdoer so far as any liability growing out of the alleged tort itself is concerned. Those alleged conspirators did not commit a tort by hiring attorneys and counsellors for their defense in the conspiracy cases. Such act of hiring attorneys and counsellors by the alleged co-conspirators was neither wrongful nor against public policy. No illegality whatever appears in the transaction wherein the conspirators hired attorneys and counselors to defend them in the conspiracy suits. That act of hiring was entirely proper, legal, and valid. Therefore, the rule invoked by appellant has no application to *Page 1074
the facts of this case. See Fakes v. Price, 89 P. 1123 (Okla.). Appellant and appellees are not joint tort-feasors so far as their acts were concerned in hiring attorneys and counselors to defend the conspiracy suit. The joint tort arose through the conspiracy to injure the aforesaid Henry W. Mowry, and culminated before the attorneys and counselors were hired. See Mowry v. Reinking (203 Iowa 628), supra. Following the alleged tort, the attorney fees and legal expenses were incurred. Said so-called wrongdoing, then, as before stated, was not being actually engaged in when the attorneys and counselors were hired. Wherefore, when the so-called conspirators hired the attorneys and counselors, they performed a new act after the conspiracy had ended. This latter act of hiring attorneys and counsellors, as before explained, was neither wrongful nor illegal.
Consequently, so far as the proposition now under consideration is concerned, appellees are entitled to contribution from appellant for his proportionate share of the attorney fees and legal expenses paid by them.
[2] II. A further argument is made by appellant in his endeavor to avoid his portion of the attorney fees and legal expenses. Such argument is based upon the theory that the obligation for attorney fees is not joint and several, but several only. The theory of the defense carried to its conclusion is that the alleged conspirators, each for himself, hired the attorneys and counselors and agreed to pay them, not all, but his individual portion of the fee only. If the contracts under which the obligations of the joint conspirators arose were several only, as distinguished from joint and several, contribution can not be had, under the facts of this case. Without the joint and several contracts there would be no basis for applying the principle of contribution, because in that event there would be no inequality of burden. Under the several obligations there would be no common duty upon a single obligor to contribute to those who performed their own several contracts only. McArthur v. Board, 119 Iowa 562; Young v. Bierschenk, 199 Iowa 309.
Whether a contract is joint or several must be determined by the terms thereof, viewed in the light of the attending circumstances, and the practical, mutual construction, if any, placed thereon by the parties. Shively v. Globe Mfg. Co.,205 Iowa 1233. In the case at bar, the parties stipulated that the *Page 1075
so-called conspirators, including the appellant, "together" hired the attorneys and counselors "to make defense for them." Furthermore, it is stipulated that "they" (the aforesaid conspirators, including appellant) employed the attorneys and counselors. It is important to note that there is lacking in the stipulation any statement that the appellant and the other conspirators severally employed those attorneys. This employment was made by the conspirators "together" to defend for them. They, not each for himself, employed the attorneys. Plainly the parties to that contract consisted of the attorneys and counselors on the one part and the common body of conspirators on the other.
Whatever defense was contemplated related, not to the group as individuals, but to all of them collectively. The obligation for these legal services was incurred by appellant and his co-conspirators jointly, as distinguished from severally. That conclusion is reached by considering the words in the stipulation with their context "viewed in the light of the attending circumstances." Under that agreement of employment the attorneys could have sued any or all of their clients for the entire compensation. Consequently there was a common obligation among the conspirators to these attorneys, and, in view of the fact that appellant did not discharge his portion of that common obligation, appellees, who paid the whole debt, are entitled to contribution from him for the excess over their own liabilities.
"Ordinarily, one of two joint obligors for the payment of money is bound to indemnify the other for any sum necessarily paid in excess of his proportional share in discharge of their obligation." Novak v. Dupont, 112 Iowa 334, (local citation 336).
[3] Such doctrine of contribution in equity does not necessarily depend upon express contract. Rather than that, such doctrine is based upon the principle that equality of burden under certain obligations is equity. Lex v. Selway Steel Corporation, 203 Iowa 792 (local citation 818). As said by the Ohio Court, in Robinson v. Boyd, 53 N.E. 494, 60 Ohio St. 57:
"It (the doctrine of contribution) is not founded on contract, but arises from the equitable consideration that persons *Page 1076
subject to a common duty or debt should contribute equally to the discharge of the duty or debt."
That pronouncement was approved in the Selway Steel Corporation case (203 Iowa 792), supra.
So, then, in view of the fact that the obligation in the case at bar is joint and several, a basis for contribution is laid. Novak v. Dupont, (112 Iowa 334), supra; Flickinger v. Price,165 Iowa 570; Kessel v. Murray, 197 Iowa 17; Hansen v. Cerro Gordo State Bank, 209 Iowa 1352. Appellant has paid no part of this obligation. Appellees were required and compelled to pay it all. To the extent that appellees paid appellant's proportional share of the obligation, they paid in excess of their own equitable share thereof. This, under the record, they were compelled to do. Accordingly, appellant should contribute to appellees for his proportionate share of the obligation.
The district court compelled him to make the contribution, and its judgment, under the record, must be, and is, affirmed. — Affirmed.
WAGNER, C.J., and EVANS, MORLING, and GRIMM, JJ., concur.
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This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2014).
STATE OF MINNESOTA
IN COURT OF APPEALS
A15-1514
In the Matter of the Civil Commitment of:
Steven Merrill Hogy
Filed April 11, 2016
Affirmed
Smith, John, Judge
Goodhue County District Court
File No. 25-PR-07-1705
Steven Merrill Hogy, Moose Lake, Minnesota (pro se appellant)
Lori Swanson, Attorney General, Angela Helseth Kiese, Assistant Attorney General,
St. Paul, Minnesota; and
Stephen N. Betcher, Goodhue County Attorney, Red Wing, Minnesota (for respondent)
Considered and decided by Bjorkman, Presiding Judge; Halbrooks, Judge; and
Smith, John, Judge.
UNPUBLISHED OPINION
SMITH, John, Judge
We affirm the district court’s denial of appellant Steven Merrill Hogy’s motion for
relief from his initial civil commitment to the Minnesota Sex Offender Program because
Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.
the motion is barred by the exclusive transfer-or-discharge remedies of the Minnesota
Commitment and Treatment Act (MCTA), Minn. Stat. §§ 253D.01-.36 (2014).
FACTS
Appellant Steven Merrill Hogy was civilly committed to the Minnesota Sex
Offender Program (MSOP) based on a determination that he is a sexually dangerous person
(SDP) and a sexual psychopathic personality (SPP). Hogy’s initial commitment was on
December 10, 2007. He was indeterminately committed on July 23, 2008. Hogy did not
appeal his commitment.
In June 2010, Hogy moved the district court pursuant to Minn. R. Civ. P. 60.02(f)
to vacate his indeterminate-commitment order. The district court denied his motion
without an evidentiary hearing. Hogy appealed to this court. In January 2011, this court
issued an unpublished opinion affirming the district court’s denial. In re Civil Commitment
of Hogy, No. A10-1615, 2011 WL 206205 (Minn. App. Jan. 25, 2011) (Hogy I) review
granted and stayed (Minn. Apr. 19, 2011), vacated (Minn. May 15, 2012). We held that a
rule 60.02 motion was an inappropriate vehicle for Hogy’s claims, Id. at *1, and instead
directed that “a patient must bring a petition to a treatment-facility special review board in
order to raise issues related to his or her treatment.” Id. (citing In re Civil Commitment of
Lonergan, 792 N.W.2d 473 (Minn. App. 2011), rev’d in part, 811 N.W.2d 635 (Minn.
2012)).
At a hearing before the MSOP Special Review Board in February 2011, Hogy
sought provisional discharge or transfer to Community Preparation Services (CPS). The
MSOP Special Review Board denied his petition.
2
In April 2011, Hogy petitioned for review of Hogy I to the Minnesota Supreme
Court. The supreme court granted and stayed review on Hogy I pending its decision in
Lonergan. The supreme court’s opinion in Lonergan clarified that the use of a rule 60.02
motion by indeterminately civilly committed patient was not universally prohibited, and
that such a motion may be proper for a narrow class of claims “that do not specifically
request transfer or discharge.” Lonergan, 811 N.W.2d at 643. The supreme court affirmed
that transfer or discharge can only be sought according to the Minnesota Commitment and
Treatment Act (MCTA). Id. at 642. In May 2012, the Hogy matter was “remanded to the
court of appeals for further proceedings consistent with” Lonergan.
Following remand from the supreme court, we issued a second unpublished opinion
on the Hogy matter in October 2012. In re Civil Commitment of Hogy, No. A10-1615,
2012 WL 5289686 (Minn. App. Oct. 29, 2012) (Hogy II), review denied (Minn. Jan. 15,
2013). We reversed in part and remanded to the district court for consideration of any of
Hogy’s claims under rule 60.02 that resembled denial-of-treatment claims; we affirmed the
district court’s denial of his other claims. Id. at *3.
Meanwhile, at the district court, a Judicial Appeal Panel affirmed the MSOP Special
Review Board’s denial of Hogy’s petition for transfer or discharge.
On remand from our decision in Hogy II, the district court dismissed all of Hogy’s
claims on their merits and with prejudice in June 2013. Hogy again appealed to this court.
In re Civil Commitment of Hogy, No. A13-1205, 2013 WL 6570583 (Minn. App. Dec. 16,
2013) (Hogy III), review denied (Minn. Feb. 26, 2014). We affirmed, in a third unpublished
opinion in this matter, holding that Hogy had failed to assert a claim fitting “within the
3
narrow class of claims that the supreme court identified in Longergan as permissible under
the provisions of rule 60.02.” Id. at *2. In Hogy III, we relied on In re Civil Commitment
of Moen, a published opinion in which we held that “a person committed as an SDP [who]
brings a motion for relief from a commitment order pursuant to rule 60.02(e) . . . based on
the alleged inadequacy of treatment in the MSOP. . .does not state a viable claim for relief
under the rule.” Id. at *1 (quoting In re Civil Commitment of Moen, 837 N.W.2d 40, 43
(Minn. App. 2013), review denied (Minn. Oct. 15, 2013)).
In March 2015, The MSOP Special Review Board held another hearing to review
Hogy’s petitions for full or provisional discharge or transfer to Community Preparation
Services. Hogy’s petitions were denied.
In June 2015, the United States District Court for the District of Minnesota ruled
that “Minnesota’s civil commitment statutory scheme is unconstitutional both on its face
and as applied.” Karsjens v. Jesson, 109 F. Supp. 3d 1139, 1173 (D. Minn. 2015) (Karsjens
I).
Following Karsjens I, Hogy filed motions in state district court in Goodhue County
for relief from final judgment pursuant to Minn. R. Civ. P. 60.02 and a temporary
restraining order (TRO) or temporary injunction pursuant to Minn. R. Civ. P. 65. Hogy
argued that because the MCTA is unconstitutional according to Karsjens I, his commitment
was unlawful ab initio. Therefore, Hogy requested relief from the judgment of
commitment, or a TRO or temporary injunction causing his conditional release. The
district court denied his motions on July 27, 2015 without an evidentiary hearing. The
district court denied Hogy’s motion pursuant to Minn. R. Civ. P. 60.02 because, it
4
determined, (1) rule 60.02 does not apply to requests for discharge from civil commitment;
(2) his motion was not based on a change in operative facts supporting his commitment;
and (3) “the federal district court order does not alter the applicable binding legal precedent,
apply to his commitment proceeding, or even constitute a final decision.” The district court
also denied his motion for a TRO or temporary injunction, concluding that Hogy would
not prevail on the merits of his motion to vacate his commitment. Hogy now appeals the
July 2015 denial of his motions.
In the federal action, the district court moved on to a “post-trial Remedies Phase” in
which various state officials were invited to formulate solutions to the MCTA’s problems.
Karsjens v. Jesson, No. 11-3659, 2015 WL 6561712, at *4-5 (D. Minn. Oct. 29, 2015)
(first interim relief order) (Karsjens II). The defendants did not offer proposals but instead
responded to remedies proposed by amici curiae, arguing that the proposals were
unworkable and improper. Id. at *5. The federal district court issued a “First Interim Relief
Order,” Id. at *15–17, and subsequently denied defendants’ motion for a stay of the order.
Karsjens v. Jesson, No. 11-3659, 2015 WL 7432333, at *7 (D. Minn. Nov. 23, 2015)
(Karsjens III). The Eighth Circuit Court of Appeals has stayed the interim-relief order
pending the federal appeal. Karsjens v. Piper, No. 15-3485 (8th Cir. Dec. 15, 2015).
DECISION
Hogy asks this court to vacate the district court’s order and remand for an
evidentiary hearing on the merits of his rule 60.02 motion. He specifically contends that
the district erred by ruling without an evidentiary hearing, by adopting language from the
state’s pleadings, and by ruling before Hogy had filed a reply to the state’s pleadings.
5
I.
Hogy moved the district court for relief from judgment or order pursuant to Minn.
R. Civ. P. 60.02(d), (e) and (f). He now argues that the district court erred by ruling on his
motion without an evidentiary hearing.
“Questions of civil procedure present issues of law, which we review de novo.” City
of Barnum v. Sabri, 657 N.W.2d 201, 204 (Minn. App. 2003). We review the district
court’s denial of a rule 60.02 motion for an abuse of discretion. Moen, 837 N.W.2d at 44–
45. A court abuses its discretion when its decision is “based on an erroneous view of the
law” or is “against the facts in the record.” City of North Oaks v. Sarpal, 797 N.W.2d 18,
24 (Minn. 2011).
In his brief on appeal, Hogy argues that he “never sought discharge” but rather
sought to have the commitment found “void for lack of jurisdiction.” The district court
held as a matter of law that Hogy could not use rule 60.02 to seek discharge from
commitment.
“[A] petitioner is entitled to an evidentiary hearing only if a factual dispute is shown
by the petition.” Seifert v. Erickson, 420 N.W.2d 917, 920 (Minn. App. 1988), review
denied (Minn. May 18, 1988). A “purely legal question involving construction of [a]
statute and application of constitutional law” does not merit an evidentiary hearing. Id.
Rule 60.02 states, in relevant part,
On motion and upon such terms as are just, the court may
relieve a party or the party’s legal representatives from a final
judgment (other than a marriage dissolution decree), order, or
proceeding and may order a new trial or grant such other relief
as may be just for the following reasons:
6
...
(d) The judgment is void;
(e) The judgment has been satisfied, released, or
discharged or a prior judgment upon which it is based has been
reversed or otherwise vacated, or it is no longer equitable that
the judgment should have prospective application; or
(f) Any other reason justifying relief from the operation
of the judgment.
Minn. R. Civ. P. 60.02.
It is unclear which facts relevant to rule 60.02, if any, Hogy would seek to dispute
at a hearing. Hogy argues that “this case turns on whether the state has demonstrated that
the [MCTA] is narrowly tailored” to meet the interests of “protecting the public from
sexual violence and rehabilitating the mentally ill,” citing In re Linehan, 594 N.W.2d 867,
872 (Minn. 1999). To the extent that Hogy’s complaint addresses the constitutionality of
the MCTA, it is a purely legal issue already being addressed by the federal courts and not
dependent on any particular factual dispute raised by Hogy. However, to the extent that
Hogy raises a claim particular to himself, there is no interpretation of his claim except that
he seeks transfer or discharge, or that he seeks a modification of his treatment program.
Claims for transfer, discharge, or modification of an MSOP treatment program are
not allowed under rule 60.02. Lonergan, 811 N.W.2d at 643 (explaining that only a narrow
class of claims “that do not specifically request transfer or discharge” may be raised by a
patient of MSOP under rule 60.02); see also Moen, 837 N.W.2d at 43 (“[A] person
committed as an SDP [who] brings a motion for relief from a commitment order pursuant
to rule 60.02(e) . . . based on the alleged inadequacy of treatment in the MSOP. . . does not
state a viable claim for relief under the rule.”). The MCTA provides the “exclusive
7
remedy” for a patient committed as an SDP pursuing transfer or discharge, and a rule 60.02
motion may not seek those ends. Lonergan, 811 N.W.2d at 642. Hogy has not
demonstrated a factual dispute that entitles him to an evidentiary hearing.
II.
Hogy argues that the district court erred by adopting the language of the state’s
pleadings without making independent determinations. Hogy cites no authority that states
it is inappropriate for a district court to adopt language from pleadings. This argument is
without merit.
III.
Hogy contends that the district court erred by ruling before he filed a reply to the
state’s pleadings. Hogy relies on Minn. R. Gen. Pract. 115.03(c), which states, “The
moving party may submit a reply memorandum, limited to new legal or factual matters
raised by an opposing party’s response to a motion . . . .” Minn. R. Gen. Pract. 115.03(c)
(emphasis added). Hogy does not articulate any “new legal or factual matters” raised by
the state to which he was deprived an opportunity to respond. This argument is also
meritless.
Affirmed.
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This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2014).
STATE OF MINNESOTA
IN COURT OF APPEALS
A15-0391
State of Minnesota,
Respondent,
vs.
Michael Marshall Johnson, a/k/a Michael Tate,
Appellant.
Filed March 7, 2016
Affirmed
Rodenberg, Judge
Hennepin County District Court
File No. 27-CR-13-35834
Lori Swanson, Attorney General, St. Paul, Minnesota; and
Michael O. Freeman, Hennepin County Attorney, Kelly O’Neill Moller, Assistant County
Attorney, Minneapolis, Minnesota (for respondent)
Cathryn Middlebrook, Chief Appellate Public Defender, Jennifer Workman Jesness,
Assistant Public Defender, St. Paul, Minnesota (for appellant)
Considered and decided by Larkin, Presiding Judge; Rodenberg, Judge; and
Hooten, Judge.
UNPUBLISHED OPINION
RODENBERG, Judge
On appeal from his conviction of being a prohibited person in possession of a
firearm, appellant Michael Marshall Johnson, n/k/a Michael Tate, challenges the
sufficiency of the evidence and argues that the prosecutor committed misconduct. We
affirm.
FACTS
In the early morning hours of October 28, 2013, gunshots were reported in North
Minneapolis. Within two to three minutes, Minneapolis Police Officers Jeff Sworski and
Will Gregory arrived at the scene and saw appellant limping across the street. Appellant
disobeyed the officers’ commands to stop and show his hands, instead continuing toward
a garbage can on the street corner. When appellant reached the garbage can, he dropped
a gun into it. Officer Sworski then knocked appellant to the ground, and the officers
physically restrained him.
As the officers were restraining appellant, he said he had been shot and that
somebody had robbed him. Appellant told the officers that this occurred down the street.
An ambulance took appellant to the hospital, where a loaded .45-caliber handgun
magazine was recovered from appellant’s jacket. At the scene of appellant’s arrest,
police recovered a .45-caliber black pistol from the garbage can.
Sergeant Stephen McCarty did follow-up investigation, interviewing appellant at
the hospital after reading him his Miranda rights. The interview was recorded and later
played in its entirety for the jury. Appellant told Sergeant McCarty that, while he was on
his way to his cousin’s ex-girlfriend’s house from a gas station, two men approached him
on the sidewalk and told him to “run [his] pockets,” meaning to empty them and turn
over anything of value. Appellant told Sergeant McCarty that he responded: “[I]s you
practicing[?] [C]ause they empty . . . [R]ob me, I ain’t got nothing.” The man closest to
2
appellant then aimed a gun at appellant. According to appellant, he began trying to
wrestle the gun away from the first man. During that struggle, the second man came up
behind appellant and shot him in the leg. Appellant fell to the ground with the first man’s
gun. Appellant told Sergeant McCarty that he was then “shot . . . two more times.”
Appellant said that, at that point, he used the gun he wrestled from the first man to shoot
in the direction of the two men. The men ran away, and appellant began walking toward
his “cousin’s ex-girlfriend[’s] house,” taking the gun with him. Sergeant McCarty asked
appellant to describe the men, but appellant said he was unable to see the faces of the two
men, who wore hooded sweatshirts with the hoods up. As a result, appellant was able to
say little more than that one man was “probably [a] little shorter than [appellant],” and
weighed around 220 pounds.
Sergeant McCarty followed up on appellant’s statements about the robbery, and
learned of a possible robbery at the same location, at around the same time that night.
Sergeant McCarty created a photo-identification lineup that included the two suspects
from that other possible robbery. Appellant was unable to identify anyone in the
photographs. Sergeant McCarty also collected DNA samples from the two suspects in
the other possible robbery and of appellant to test against DNA collected on the gun
appellant had dropped into the garbage can. The results indicated that neither suspect’s
DNA sample matched the DNA on the gun, but that appellant’s DNA could not be
excluded as contributing to the mixture of DNA on the gun.
Appellant was charged with one count of being a prohibited person in possession
of a firearm, in violation of Minn. Stat. § 624.713, subd. 1(2) (2012). Appellant
3
stipulated that he was ineligible to possess a firearm. Officer Sworski, Officer Gregory,
and appellant all testified at the jury trial that appellant possessed the gun and tossed it
into the garbage can. Appellant asserted the affirmative defense of necessity. The jury
was instructed accordingly.
At trial, appellant’s necessity defense relied exclusively on his testimony. His trial
testimony was similar to what he told Sergeant McCarty in the hospital interview, with a
few variations and additions. For example, there were differences concerning when
appellant began shooting back at the men after he wrestled the gun away. Appellant was
also inconsistent in recounting the order of the injuries he received. Appellant also never
told Sergeant McCarty that the gun did not work the first time he tried to shoot it or that
he reloaded the gun at the end of the attempted robbery, as he claimed at trial. During
closing argument, the state emphasized these and other inconsistencies between
appellant’s various recitations of what happened.
The prosecutor also said during closing argument that “to accept this defense of
necessity, you must buy the whole story hook, line, and sinker. You got to buy the whole
thing. If you don’t buy part of it, [appellant] hasn’t met his burden and he’s not
credible.” The prosecutor also noted that “[t]here is no independent evidence that
corroborates [appellant’s] rather fanciful tale,” that appellant’s statements were
inconsistent concerning where he was living at the time of the incident, and that appellant
did not identify the suspects in the photo-identification lineup because “if he confirms the
identities of the suspects, there are people that might come and tell a different story about
what happened that night.”
4
The jury found appellant guilty, and the district court sentenced appellant to 60
months in prison. This appeal followed.
DECISION
I. Sufficiency of the evidence
Appellant argues that the evidence is insufficient to support his conviction of
being a prohibited person in possession of a firearm because his possession of the gun
was a necessity. In reviewing the sufficiency of the evidence, we “review the evidence to
determine whether the facts in the record and the legitimate inferences drawn from them
would permit the jury to reasonably conclude that the defendant was guilty beyond a
reasonable doubt of the offense of which he was convicted.” State v. Al-Naseer, 788
N.W.2d 469, 473 (Minn. 2010) (quotation omitted). We assume “the jury believed the
state’s witnesses and disbelieved any evidence to the contrary.” State v. Moore, 438
N.W.2d 101, 108 (Minn. 1989). Inconsistencies in testimony go to witness credibility,
which is an issue for the fact-finder, not the reviewing court. State v. Pendleton, 706
N.W.2d 500, 512 (Minn. 2005).
Appellant was convicted under Minn. Stat. § 624.713, subd. 1(2), which prohibits
certain people from possessing firearms, and appellant stipulated to being ineligible to
possess a firearm. Officer Sworski, Officer Gregory, and appellant all testified that
appellant possessed the gun on October 28, 2013. Appellant’s sufficiency-of-the-
evidence argument therefore only concerns his necessity defense.
5
The necessity defense “applies only in emergency situations where the peril is
instant, overwhelming, and leaves no alternative but the conduct in question.” State v.
Johnson, 289 Minn. 196, 199, 183 N.W.2d 541, 543 (1971).
To successfully assert the defense, a criminal defendant must
show that the harm that would have resulted from obeying the
law would have significantly exceeded the harm actually
caused by breaking the law, there was no legal alternative to
breaking the law, the defendant was in danger of imminent
physical harm, and there was a direct causal connection
between breaking the law and preventing the harm.
Axelberg v. Comm’r of Pub. Safety, 831 N.W.2d 682, 685 (Minn. App. 2013), aff’d, 848
N.W.2d 206 (Minn. 2014).
Here, appellant’s version of wrestling the gun away from one of his would-be
robbers would, if believed, support a conclusion that appellant had “no legal alternative
to breaking the law,” “the harm to be prevented [was] imminent,” and “a direct, causal
connection [existed] between breaking the law and preventing the harm.” See id.
(defining the elements of the necessity defense). But whether the necessity defense
applies depends on the credibility of appellant’s testimony. That determination is for the
jury, and not for a reviewing court. Pendleton, 706 N.W.2d at 512. The jury was
instructed on the necessity defense, and appellant does not challenge those instructions on
appeal. The jury found appellant guilty of being a prohibited person in possession of a
firearm. To reach that verdict, the jury necessarily disbelieved appellant’s testimony, and
found it more likely than not to be untrue.
6
Our thorough review of the record reveals nothing that would warrant overturning
the jury’s credibility determinations. The evidence is sufficient to support appellant’s
conviction.
II. Prosecutorial misconduct
Appellant argues that the prosecutor committed misconduct during summation.
“[W]e reverse only if the misconduct, when considered in light of the whole trial,
impaired the [appellant’s] right to a fair trial.” State v. Swanson, 707 N.W.2d 645, 658
(Minn. 2006). Where, as here, a defendant fails to object at trial to claimed prosecutorial
error or misconduct, we review under a modified plain-error standard. State v. Ramey,
721 N.W.2d 294, 302 (Minn. 2006). This two-tiered test first requires appellant to
establish that the prosecution committed error that is plain in that the prosecutor’s
conduct contravenes caselaw, a rule, or a standard of conduct. Id. If appellant makes this
showing, the burden shifts to the state to demonstrate that the error did not affect
appellant’s substantial rights. Id. “Plain error is considered prejudicial if there is a
reasonable likelihood that the error had a significant effect on the jury’s verdict.” State v.
Young, 710 N.W.2d 272, 280 (Minn. 2006) (quotations omitted). Even where error
occurs, we will reverse only when an appellant was denied a fair trial. State v. Porter,
526 N.W.2d 359, 365 (Minn. 1995).
We review closing arguments in their entirety when determining whether
prosecutorial misconduct occurred. State v. Vue, 797 N.W.2d 5, 15 (Minn. 2011); see
State v. Jackson, 714 N.W.2d 681, 694 (Minn. 2006) (quotations omitted) (noting that
this court should consider “the closing argument as a whole rather than focus on
7
particular phrases or remarks that may be taken out of context or given undue
prominence”). A prosecutor is allowed “considerable latitude” in closing and is not
required to make a “colorless” argument. State v. Smith, 541 N.W.2d 584, 589 (Minn.
1996). However, “[m]isstatements of the burden of proof are highly improper and would,
if demonstrated, constitute prosecutorial misconduct.” State v. Hunt, 615 N.W.2d 294,
302 (Minn. 2000).
Appellant challenges four portions of the prosecutor’s closing argument. We
review each of those portions in turn, applying the modified plain-error standard.
A. Independent corroborating evidence
Appellant challenges the prosecutor’s statement that “there is no independent
evidence that corroborates [appellant’s] rather fanciful tale.” Appellant argues that this
statement was error because it implied that appellant has the burden of producing
evidence to prove his innocence.
Here, appellant’s entire defense at trial amounted to his claim that he possessed the
gun out of necessity. Appellant had the burden of proving the elements of necessity by a
preponderance of the evidence. In that context, the prosecutor’s statement was part of the
state’s legitimate, broader effort to argue that appellant’s affirmative defense lacked
merit. See State v. MacLennan, 702 N.W.2d 219, 236 (Minn. 2005) (“As part of the
state’s right to vigorously argue its case, it may specifically argue that there is no merit to
the particular defense. . . .”). Specifically, because appellant’s hospital interview and
testimony were the only pieces of evidence supporting appellant’s version of events,
because other evidence was inconsistent with appellant’s testimony, and because
8
appellant had the burden of proof concerning the necessity defense, the prosecutor’s
commentary concerning the lack of independent corroborating evidence concerning the
defense of necessity was proper. The comment was not error, much less plain error.
B. Statement concerning identification of possible robbery suspects
Appellant argues that the prosecutor improperly attacked appellant’s character
with his statement: “[I]f he confirms the identities of the suspects, there are people that
might come and tell a different story about what happened that night.” Appellant asserts
that this comment was designed to imply that appellant was a liar and to inflame the
jury’s passions.
A prosecutor may not make arguments that are not supported by the evidence or
that are designed to inflame the jury’s passions or prejudices against the defendant. State
v. Rucker, 752 N.W.2d 538, 551 (Minn. App. 2008), review denied (Minn. Sept. 23,
2008). Prosecutors may present “all legitimate arguments on the evidence, to analyze
and explain the evidence, and to present all proper inferences to be drawn therefrom,”
Smith, 541 N.W.2d at 589, but it is “unprofessional conduct for the prosecutor
intentionally to misstate the evidence or mislead the jury as to the inferences it may
draw.” State v. Bobo, 770 N.W.2d 129, 142 (Minn. 2009) (quotations omitted).
Appellant frames the prosecutor’s statement as commentary on appellant’s “failure
to call a witness.” Were it so, that would be impermissible. See State v. Mayhorn, 720
N.W.2d 776, 787 (Minn. 2006) (explaining how such a comment prejudices a criminal
defendant).
9
In context, the prosecutor was recounting certain pieces of evidence immediately
before making the statement, including the discrepancies between appellant’s statements
and appellant’s ultimate inability to identify the two suspects when Sergeant McCarty
presented him with a photo-identification lineup. The prosecutor made no comment on
appellant’s decision not to call those suspects as trial witnesses. Instead, the comment
was a reasonable argument concerning why appellant did not identify the two suspects in
the photo-identification lineup.
We conclude that the prosecutor’s statement was a reasonable inference based on
the evidence. As such, it was not error. See State v. Jones, 753 N.W.2d 677, 691-92
(Minn. 2008) (“A prosecutor’s closing argument need not be colorless, so long as it is
based on the evidence or reasonable inferences from that evidence.”).
C. Statement concerning obstruction of investigation
Appellant next argues that the prosecutor improperly suggested that appellant
obstructed the police’s investigation by stating:
Isn’t that what [appellant is] doing in this entire case, is
telling half-truths? I want you to consider that. He says he’d
been living in abandoned houses. That’s what he tells the
officer, sends him off to Dupont Avenue as to where he gets
his mail and stuff like that, occasionally goes there to take a
shower. He tells you on the stand that he’s living in Crystal,
frequently spends time with a cousin on Aldrich Avenue and
33rd. Nowhere did he tell that to the officers. If indeed that
was true when he was on the stand, he didn’t tell it to the
officer at the time. And why wouldn’t he do that? Well,
police can execute search warrants. They can go to places
where people live. They can look for evidence that supports
the crime. But if you don’t tell them where you live, you
don’t give the police the information they need to be able to
further investigate a crime.
10
The state’s argument properly emphasized that appellant gave inconsistent
statements concerning where he was living at the time of the offense. In context, where
appellant’s credibility was crucial, the argument was not improper.
D. Burden of proof
Finally, appellant argues that the prosecutor committed misconduct by stating:
“[T]o accept this defense of necessity, you must buy the whole story hook, line, and
sinker. You got to buy the whole thing. If you don’t buy part of it, [appellant] hasn’t met
his burden and he’s not credible.” We note that appellant’s initial brief framed this issue
as one of a misstatement of appellant’s burden. In his reply brief, appellant re-casts the
issue as one of an improper shifting of the burden of persuasion to appellant. Because
appellant did not raise the burden-shifting argument until his reply brief, the argument is
not properly preserved. Minn. R. Civ. P. 128.02, subd. 3; see State v. Thompson, __
N.W.2d __, __, 2015 WL 9437538 at *2 n.1 (Minn. App. Dec. 28, 2015) (“Generally,
issues not raised or argued in appellant’s principal brief cannot be revived in a reply
brief.”).
On its merits, appellant’s creative burden-shifting argument relies on State v.
Hage, in which the Minnesota Supreme Court held that a criminal defendant bears the
burden of production, but not persuasion, when a necessity defense negates an element of
the crime. 595 N.W.2d 200, 204-07 (Minn. 1999). Appellant argued in his reply brief
that the necessity defense negates the “entitled to possess” element of Minn. Stat.
§ 624.713, subd. 1.
11
Even if the burden-shifting argument were considered to have been preserved,
appellant stipulated to the element in question at the district court. He agreed that he was
not a person entitled to possess a firearm. He cannot argue on appeal that the
prosecutor’s comments impermissibly shifted the burden on an element to which he
stipulated at trial. We therefore turn to appellant’s argument that the prosecutor’s
statement was a misstatement of appellant’s burden.
1. The prosecutor’s statement was plain error.
Appellant’s burden concerning his necessity defense did not require him to prove
his innocence, but only required that he prove it to be more likely than not that he acted
out of necessity. Hage, 595 N.W.2d at 204-05 (“[O]nce the state has met its burden of
proving beyond a reasonable doubt every element of the crime charged, the state may . . .
impose upon a criminal defendant the burden of proving by a preponderance of the
evidence that her conduct should be excused by some mitigating circumstance or issue.”).
Despite the latitude afforded a prosecutor’s closing argument, the “hook, line, and
sinker” statement misstates the burden of proof. The jury plainly did not need to believe
every detail of appellant’s story. The necessity defense required only that the jury find it
more likely than not that appellant possessed the gun because he wrestled it away from a
would-be robber. The prosecutor’s statement instead suggested that the jury needed to
believe every detail of appellant’s story. The prosecutor’s “hook, line, and sinker”
comment was plainly erroneous.
12
2. The plain error did not affect appellant’s substantial rights.
Under the modified plain-error standard, the state bears the burden of showing a
lack of prejudice where the prosecutor committed plain error. Ramey, 721 N.W.2d at
302. We consider “the strength of the evidence against the defendant, the pervasiveness
of the improper suggestions, and whether the defendant had an opportunity to (or made
efforts to) rebut the improper suggestions.” State v. Hohenwald, 815 N.W.2d 823, 835
(Minn. 2012) (quotation omitted). Additionally, “a prosecutor’s attempts to shift the
burden of proof are often nonprejudicial and harmless where, as here, the district court
clearly and thoroughly instructed the jury regarding the burden of proof.” State v.
McDonough, 631 N.W.2d 373, 389 n.2 (Minn. 2001).
The prosecutor’s “hook, line, and sinker” comment was a single line in what
amounted to 34 pages of closing argument and rebuttal by the prosecutor. Upon careful
review of the closing argument, we conclude that the “hook, line, and sinker” comment
was the only instance where the prosecutor misstated the law. Both the prosecutor and
the district court correctly explained to the jury that the state had the burden of proving
appellant was guilty beyond a reasonable doubt and that appellant has the burden of
proving necessity by a preponderance of the evidence. And finally, appellant’s trial
counsel had the opportunity to rebut the misstatement, which occurred during the
prosecutor’s main closing argument. Appellant’s trial counsel took the opportunity in
closing to clarify the necessity defense and the preponderance-of-the-evidence standard.
13
Even though the prosecutor committed plain error with the “hook, line, and
sinker” comment, we conclude that the comment did not substantially influence the jury
to convict appellant.
Affirmed.
14
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01-03-2023
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06-09-2016
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https://www.courtlistener.com/api/rest/v3/opinions/7247160/
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CARMEN CONSUELO CEREZO, United States District Judge
Plaintiff Yaw Twum-Baah ("Twum-Baah"), appearing pro se , filed this action against the United States Department of Agriculture ("USDA") and United States Forest Service officers Aymat Verdejo, Derek Ortiz, and Christina Henderson in their official capacity (together with the USDA, the "Federal defendants") after numerous skirmishes with them at El Yunque National Forest ("El Yunque"). Before the Court is the Federal Defendants' Memorandum of Law in Support of their Motion to Dismiss (d.e. 13 ) filed on May 19, 2017, arguing plaintiff's claims should be dismissed for lack of subject matter jurisdiction and for failing to state a claim, and Twum-Baah's Opposition Memorandum to Defendants' Motion to Dismiss (d.e. 18) filed on August 4, 2017. For the reasons set forth below, the Federal defendants' motion is GRANTED.
BACKGROUND
Twum-Baah is a representative of the Waroyal Ministry who took his congregation to El Yunque as part of their worship. Together with his wife Selene Cardenas, he also started the tourism company Yotumba Tours, which offered guided tours in El Yunque.
In his amended complaint, Twum-Baah alleges that the Federal defendants conspired with the Tourism Company of Puerto Rico to persecute him for assembling his congregation to worship within El Yunque and/or provide tours in his capacity as a guide for Yotumba Tours. As part of this supposed conspiracy, Twum-Baah lists confrontations he had with the aforementioned USDA officials from April 2015 to April 2016. Although Twum-Baah asserts that the Federal defendants initiated these encounters without probable cause, the Federal defendants issued violation notices against him for infringing certain National Forest System regulations listed in 36 C.F.R. 261.10.
The Federal defendants understood that plaintiff used the premise of El Yunque without obtaining a special use authorization as required under 36 C.F.R. §§ 251.50(a), 261.10(k). Aggrieved by what he considered to be a governmental campaign against him, Twum-Baah filed an administrative complaint of discrimination with the USDA Office of the Assistant Secretary for Civil Rights on February 28, *3722016. Twum-Baah went through great lengths to provide detailed accounts of his encounters with the Federal defendants, but the Office dismissed his complaint because Twum-Baah concurrently filed identical claims in previous suits before this Court. Believing he had exhausted his administrative remedies, Twum-Baah commenced the instant suit on August 15, 2016 for alleged violations of his constitutional rights under the 1st Amendment and for claims sounding in tort. On May 19, 2017, the Federal defendants moved to dismiss the complaint, arguing that the United States has not waived its immunity for 1st Amendment claims, that Twum-Baah has not fulfilled the administrative requirements to bring some of his tort claims under the FTCA, that the statute of limitations had run on others, and that he had failed to state a claim for harassment.
Twum-Baah filed a Motion to Amend his Complaint (d.e. 19 ) on August 4, 2017, which is GRANTED, the tendered amended complaint is authorized. It elaborates on the formation of the alleged governmental conspiracy, clarifies his claims are mostly based in tort, expounds on the damages he suffered, and arguably adds a claim of racial or ethnic discrimination. Since the amended complaint was filed three months after the motion to dismiss, the Federal defendants did not address the last of these potential claims. But because the rest of the claims in the amended complaint are identical to those asserted in the original complaint, the Court has considered the Federal defendants' arguments for dismissal in its analysis.
RELEVANT LEGAL STANDARDS
I. Fed. R. Civ. P. 12(b)(1) and 12(b)(6)
A motion to dismiss is used to evaluate the legal sufficiency of the plaintiff's complaint, not to test the merits of the underlying claims. When considering a motion to dismiss, the Court "must construe the complaint liberally, treating all well-pleaded facts as true and indulging all reasonable inferences in favor of the plaintiff." Aversa v. United States , 99 F.3d 1200, 1210 (1st Cir. 1996). Given that Twum-Baah is a pro se litigant, the Court construes his pleadings more liberally and holds him to a less stringent standard than would apply to the average lawyer. See Velez-Villaran v. Carico Int'l, Inc. , 715 F.Supp.2d 250, 252 (D.P.R. 2010).
"A defendant may, in response to an initial pleading, file a motion to dismiss the complaint for lack of jurisdiction over subject matter and for failure to state a claim upon which relief can be granted. See Fed. R. Civ. P. 12(b)(1) and 12(b)(6), respectively." Fernandez Molinary v. Industrias La Famosa, Inc. , 203 F.Supp.2d 111, 113-14 (D.P.R. 2002). "When faced with motions to dismiss under both 12(b)(1) and 12(b)(6), a district court, absent good reason to do otherwise, should ordinarily decide the 12(b)(1) motion first." Rosario-Gonzalez v. Seguros Multiples , No. CIV. 13-1079 JAF, 2013 WL 4045740, at *1 (D.P.R. Aug. 7, 2013), aff'd (June 11, 2014) (citing Northeast Erectors Ass'n of BTEA v. Secretary of Labor, Occupational Safety & Health Admin. , 62 F.3d 37 (1st Cir. 1995) ). "It is not simply formalistic to decide the jurisdictional issue when the case would be dismissed in any event for failure to state a claim. Different consequences flow from dismissals under 12(b)(1) and 12(b)(6): for example, dismissal under the former, not being on the merits, is without res judicata effect." Id. (citing Northeast Erectors , 62 F.3d at 39 ).
"If the Court determines that subject matter jurisdiction does not exist it must dismiss the case and not make any determination on the merits of the case." Fernandez Molinary , 203 F.Supp.2d at 114 (referring to Menendez v. United States , 67 F.Supp.2d 42, 45 (D.P.R.1999) ).
*373As the party invoking this Court's jurisdiction, Twum-Baah bears the burden of proving subject matter jurisdiction exists. See Murphy v. U.S. , 45 F.3d 520, 522 (1st Cir. 1995). When evaluating a motion to dismiss for lack of subject matter jurisdiction under Rule 12(b)(1), "the court may consider documents outside the pleadings, such as exhibits and affidavits attached to the motion to dismiss, and the opposition." Mercado Arocho v. United States , 455 F.Supp.2d 15, 17 (D.P.R. 2006).
"To survive a motion to dismiss [under Rule 12(b)(6) ], a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.' A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. The plausibility standard is not akin to a 'probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) (citing Bell Atlantic Corp. v. Twombly , 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). "In assessing a claim's plausibility, the court must construe the complaint in the plaintiff's favor, accept all non-conclusory allegations as true, and draw any reasonable inferences in favor of plaintiff." Rosario-Gonzalez , 2013 WL 4045740, at *2 (referring to San Geronimo Caribe Project, Inc. v. Acevedo-Vila , 687 F.3d 465, 471 (1st Cir. 2012) ).
As opposed to motions to dismiss under Rule 12(b)(1), when defendant moves to dismiss under Rule 12(b)(6), the court's "[c]onsideration is limited to the complaint, written instruments that are attached to the complaint as exhibits, statements or documents that are incorporated in the complaint by reference, and documents on which the complaint heavily relies... [t]he court should not consider any other documents or pleadings, except for the complaint, to determine jurisdiction." Mercado Arocho , 455 F.Supp.2d at 19.
II. Sovereign Immunity of Federal Agencies and their officials
The doctrine of sovereign immunity bars all lawsuits against the United States and federal agencies like the USDA unless Congress has consented to the action. See F.D.I.C. v. Meyer , 510 U.S. 471, 475, 114 S.Ct. 996, 1000, 127 L.Ed.2d 308 (1994) (stating: "[a]bsent a waiver, sovereign immunity shields the Federal Government and its agencies from suit"); see also Blackmar v. Guerre , 342 U.S. 512, 515, 72 S.Ct. 410, 96 L.Ed. 534 (1952) (showing the USDA enjoys this protection). Congress's waiver of sovereign immunity must be expressed unequivocally in a statute. See generally Dolan v. U.S. Postal Service , 546 U.S. 481, 126 S.Ct. 1252, 163 L.Ed.2d 1079 (2006). The waiver of sovereign immunity should be narrowly construed in favor of the United States. See United States v. Nordic Village, Inc. , 503 U.S. 30, 33-34, 112 S.Ct. 1011, 117 L.Ed. 2d 181 (1992).
Because federal agencies cannot be sued absent congressional approval, those who feel they have been injured by agency employees must recur to the Federal Tort Claims Act (FTCA). 28 U.S.C. §§ 1346(b), 2671 et seq. The FTCA "provides a limited congressional waiver of the sovereign immunity of the United States for torts committed by federal employees acting within the scope of their employment." Suren-Millan v. United States , 38 F.Supp.3d 208, 218-19 (D.P.R. 2013) (citing Santoni v. Potter , 369 F.3d 594, 602 (1st Cir. 2004) ). Under the FTCA, the federal government waives its sovereign immunity for torts " 'caused by the negligent or wrongful act or omission of any employee of the Government while acting within the scope of his office or employment, *374under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.' " Solis-Alarcón v. United States , 662 F.3d 577, 582 (1st Cir. 2011).
For claims alleging federal officers have violated their constitutional rights, potential plaintiffs can sue them in an individual capacity by filing a Bivens claim. See generally Bivens v. Six Unknown Named Agents , 403 U.S. 388, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971). However, the Supreme Court has recognized that plaintiffs have a right to assert Bivens claims to recover damages for violations of only certain constitutional rights. See Id. , recognizing a right to sue for Fourth Amendment violations; Davis v. Passman , 442 U.S. 228, 99 S.Ct. 2264, 60 L.Ed.2d 846 (1979), recognizing a right to sue for Fifth Amendment violations under the principle of equal protection; Carlson v. Green , 446 U.S. 14, 100 S.Ct. 1468, 64 L.Ed.2d 15 (1980), recognizing a right to sue under Eight Amendment's prohibition against cruel and unusual punishment; but see Bush v. Lucas , 462 U.S. 367, 103 S.Ct. 2404, 76 L.Ed.2d 648 (1983), denying a right to sue for retaliation under the First Amendment. In fact, during the past thirty years the Supreme Court has typically denied requests "to extend Bivens liability to any new context or new category of defendants." Corr. Servs. Corp. v. Malesko , 534 U.S. 61, 68, 122 S.Ct. 515, 520, 151 L.Ed.2d 456 (2001).
DISCUSSION
Ascribing to the aforementioned legal standards, the Court first addresses the claims found to lack subject matter jurisdiction before addressing those that fail to state a claim.
I. Under the Federal Tort Claims Act ("FTCA")
Twum-Baah's amended complaint is a flawed attempt to sue the USDA and the Forest Service officers. Under the FTCA, sovereign immunity is only waived where the United States of America, not an agency or employee, is named as the defendant. See McCloskey v. Mueller , 446 F.3d 262 (1st Cir. 2006) (holding a claim that Federal Bureau of Investigation (FBI) and its employees were negligent in failing to respond to alleged perpetrator's offer to turn himself in on prior charges, made day before killing, was required to be brought against United States, under FTCA provision precluding tort suits against individual agencies). 28 U.S.C.A. § 1346(b). See also Spinale v. U.S. Dep't of Agric. , 621 F.Supp.2d 112, 116 (S.D.N.Y.), aff'd sub nom. Spinale v. U.S. Dep't of Agr. , 356 Fed.Appx. 465 (2d Cir. 2009) (discussing the USDA's sovereign immunity and stating "the United States, and its agencies, have not waived sovereign immunity for intentional tort claims under the FTCA"). For this reason alone, Twum-Baah's tort claims against the Federal defendants would be dismissed for lack of subject matter jurisdiction.
Nonetheless, the Court owes him a more favorable reading of the amended complaint given his status as a pro se plaintiff. In so doing, it analyzes Twum-Baah's allegations as if he asserted FTCA claims properly against the United States. Under a liberal reading of his amended complaint, the Court can surmise Twum-Baah assertion of the following torts: 1. false arrest and/or malicious prosecution (see d.e. 19-1, ¶¶ 2, 3, 4, 5, 6, 8 for references to apprehensions "without probable cause or evidence [of] illegal activity," "handing me a violation for illegal activity," "disgracefully given another violation ticket ... without probable cause," "handed me another violation *375ticket for illegal activity without probable cause," and "gave me the final ticket ... without probable cause," and "chased me ... again without probable cause"); 2. abuse of process (see Id. , ¶ 5 stating "what an abuse of power ... without probable cause); 3. harassment (see Id. , ¶¶ 3, 8, 14 for references to "decided to [h]arass my activities to a halt," "again ... I was harassed," "I was [ ]recording the entire harassment," "I was again harassed and tailed while I was working."); 4. libel, slander or defamation (see Id. , ¶¶ 3, 13 for references to "disgracing me in front of my congregation as a fraud" and "[a] defamation was made of the company and any association to Yaw Twum-Baah."); and 5. tortious interference with contractual rights (see I.d. , ¶ 12 stating "[t]his van belonged to Juan Laureano and until I had finished making payments for the van, it legally belonged to him. Since I was the one using the van and I was presumed the owner, the van[']s El Yunque privileges and permits were taken away..."). In his opposition to the Federal defendants' motion to dismiss, he also clarifies that "[i]t Is under this provision, [the FTCA], that I plead my case humbly to this Honorable court..." d.e. 18.
However, in order to bring these FTCA claims against the United States, a party must first follow certain procedural requirements. See 28 U.S.C. § 2675. Particularly relevant to the instant action is the prerequisite that a potential plaintiff first file an administrative claim with the relevant federal agency before suing the United States. 28 U.S.C. § 2675(a). For purposes of the provisions of 28 U.S.C. 2675(a), "a claim shall be deemed to have been presented when a Federal agency receives from a claimant ... an executed Standard Form 95 or other written notification of an incident, accompanied by a claim for money damages in a sum certain for injury to or loss of property, personal injury, or death alleged to have occurred by reason of the incident." 28 C.F.R. § 14.2(a).
Twum-Baah filed an administrative claim with the USDA Office of the Assistant Secretary for Civil Rights. After a careful review of this claim, the Court finds it does not satisfy the administrative exhaustion requirement for his potential FTCA claims against the Federal defendants.
First, the claim was filed with the wrong office. For alleged torts committed by Forest Service employees while conducting their official duties, Twum-Baah should have filed his claim with the Albuquerque Service Center-Budget and Finance Director, the Forest Service's official FTCA claims officer, or at least with the USDA's Office of the General Counsel, authorized to consider or settle FTCA claims against the agency. See U.S. FOREST SERVICE, CLAIMS PROCESSING UNDER THE FEDERAL TORT CLAIMS ACT (FTCA) QUESTIONS AND ANSWERS , https://www.fs.usda.gov/Internet/FSE_DOCUMENTS/stelprdb5436568.pdf; U.S. DEPARTMENT OF AGRICULTURE, RD Instruction 2042-A, Part 2042, Subpart A, Section 2042.2.
Second, Twum-Baah's administrative complaint to the Office of the Assistant Secretary for Civil Rights was for discrimination, not for tortious conduct. See e.g. d.e. 19-2, p. 1 stating "I was [d]iscriminated by type of Equal Pay, Harassment, National Original, Race/Color, Religion and Retaliation." Under the most favorable reading of this administrative complaint, it does not sufficiently notify the USDA of the aforementioned FTCA claims. Proper notification of a claim is an important requirement that serves the interest of the expeditious resolution of legitimate disputes citizens may have against the government. See *376Furman v. U.S. Postal Service, 349 F.Supp.2d 553, 557 (E.D.N.Y. 2004) (stating "[t]he purpose of the exhaustion requirement is to allow the government to investigate, evaluate and consider settlement of a claim, in order to ease court congestion and avoid unnecessary litigation, while making it possible for the Government to expedite the fair settlement of tort claims asserted against the United States"). Strict adherence to this requirement also ensures that the claim is evaluated by the agency most familiar with the underlying events and helps both the agency and the claimant avoid "expensive and time-consuming litigation when possible." Id.
"It is well-settled First Circuit precedent that the timely filing of an administrative claim is a jurisdictional pre-requisite to file suit under [the] FTCA." Ortiz-Rivera v. United States , 203 F.Supp.3d 216, 219 (D.P.R. 2016) (referring to González v. United States , 284 F.3d 281, 287 (1st Cir. 2002). Having failed to satisfy this administrative requirement, Twum-Baah's potential FTCA claims are dismissed for lack of subject matter jurisdiction.
II. Bivens claim under the First Amendment
Congress has not waived the USDA's immunity for constitutional torts either. See Spinale , 621 F.Supp.2d at 120. Any of Twum-Baah's potential constitutional claims against the Federal defendants should thus be dismissed for lack of subject matter jurisdiction since they were brought against the agency. However, the Court again reads his amended complaint as if he proceeded through the proper legal vehicle, in this case a Bivens claim against the Forest Service officers in their individual capacities. See F.D.I.C. v. Meyer , 510 U.S. 471, 484-85, 114 S.Ct. 996, 127 L.Ed.2d 308 (1994) (finding that Bivens claims can only be brought against agency employees, not the agency itself.)
A liberal reading of plaintiff's amended complaint suggests Twum-Baah claims officers Verdejo, Ortiz, and Henderon violated his First Amendment rights to freely exercise his religion and to peaceably assemble with the Excursionist Association for El Yunque. U.S. Const. amend. I. See d.e. 19-1, ¶¶ 1, 3, 5, 9, 12 for references to "lawfully was exercising his religious activities," "interrupting my religious exercises," "they asked me to leave the park and discontinue my religious activities," "I refused to be denied my constitutional right to freedom to practice religion," "I was operating a religious exercise," "threatened the president the possibility of losing other benefits ... if he continues to associate with me," "she did not want [ ] anybody affiliated with Yaw Twum-Baah working in the forest," and "to not associate themselves to Yaw Twum-Bah." In his opposition to the Federal defendants' motion to dismiss, he also clarifies that "this is a case that shows purpose, state of mind, agenda and motive by the USDA ... as a deliberate attack and infringement of [p]laintiff's rights to peacefully assemble and to express his religious views and opinions." d.e. 18.
Nonetheless, the Court's understanding of Bivens and subsequent decisions by the Supreme Court compels it to find Bivens claims are not available for violations of the First Amendment's Free Exercise clause. In Ashcroft v. Iqbal , 556 U.S. 662, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009), the Supreme Court stated that it has "declined to extend Bivens to a claim sounding in the First Amendment." Id. at 672, 129 S.Ct. 1937. More recently, in Ziglar v. Abbasi , --- U.S. ----, 137 S.Ct. 1843, 1857, 198 L.Ed. 2d 290 (2017), the Supreme Court reiterated that "expanding the Bivens remedy is now a 'disfavored' judicial activity." Id. at 1857. It explicitly stated that it "has refused to do so for the *377past 30 years." Id. Additionally, although the First Circuit has yet to decide on this particular issue, the Second Circuit recently declined to recognize the availability of a Bivens remedy for violations of the free exercise clause. See Turkmen v. Hasty , 789 F.3d 218, 236 (2d Cir. 2015), judgment rev'd in part, vacated in part sub nom. Ziglar v. Abbasi , --- U.S. ----, 137 S.Ct. 1843, 198 L.Ed.2d 290 (2017). This Court declines to expand Bivens claims to purported violations of the Free Exercise clause.
The Supreme Court's disfavor of Bivens claims in new contexts also lends support to our rejection of plaintiff's claim for violations of the First Amendment's Assembly clause.
III. Bivens claim under Equal Protection Clause of Fifth Amendment
Finally, a liberal reading of Twum-Baah's amended complaint suggests that he charges the Forest Service officers of discriminating against him on the base of his race or ethnicity, thereby denying him the equal protection of the laws as required under the Fifth Amendment. See d.e. 19-1, p. 2, for reference to "[f]ederal officers are not to retaliate or harass or discriminate based on [ ], race, ethnicity ... Under the Equal Protection clause, it is their responsibility to explain the law and rights I have to my accusers."
In Davis v. Passman , 442 U.S. 228, 99 S.Ct. 2264, 60 L.Ed.2d 846 (1979), the Supreme Court held that a claim for damages could be asserted against a federal official based upon an alleged violation of the equal protection principles of the Fifth Amendment. Consequently, Twum-Baah's claim sounding in discrimination survives dismissal on subject-matter jurisdiction grounds.
Nonetheless, he fails to state a cognizable claim for racial or ethnic discrimination under the Fifth Amendment. The amended complaint does not contain any statement made by Forest Service officers that reflect a discriminatory animus for their confrontations with him. For example, his claims of Officer's Verdejo's alleged discriminatory acts refer to discrimination by Puerto Ricans against Dominicans, but not against him as an immigrant or for his religious beliefs. See e.g., d.e. 19-1 stating: "[t]his has proof of racial discrimination since most taxi drivers are Dominicans and it is generally known throughout Puerto Rico that Puerto Ricans don't like Dominicans." In his administrative complaint, he describes an incident on July 4, 2015 where Officer Verdejo inspects the tints on his van's windows and orders another officer to issue him a ticket for having "more tints than the law requires." d.e. 19-2, p. 9. Because the vehicle's windows were tinted as purchased, Twum-Baah alleges "[t]his is proof that A. Verdejo enjoys harassing me and hates me as a black male that fails to be easy prey." Id. These conclusory allegations of discrimination are insufficient to survive dismissal under Rule 12(b)(6). See Twombly , 550 U.S. at 555, 127 S.Ct. 1955.
The Court thus finds that Twum-Baah has failed to state a claim of discrimination and dismisses his Bivens claim for equal protection of the laws under Rule 12(b)(6).
CONCLUSION
Having carefully considered the amended complaint, even after reading its allegations in the most favorable manner, the Court concludes that its deficiencies preclude plaintiff from proceeding past the pleading stage. For the reasons stated herein, the Federal defendants' Motion to Dismiss, supported by memorandum (d.e. 13 ), is GRANTED.
Given the Court's inclination to dismiss sua sponte the Bivens claim under the Fifth Amendment, plaintiff is given the *378opportunity to argue against its dismissal. See Chute v. Walker , 281 F.3d 314, 319 (1st Cir. 2002) stating "[t]he general rule is that in limited circumstances, sua sponte dismissals of complaints under Rule 12(b)(6)... are appropriate, but that such dismissals are erroneous unless the parties have been afforded notice and an opportunity to amend the complaint or otherwise respond."
Accordingly, plaintiff shall, no later than MARCH 23, 2018 , state the reasons why his Bivens claim under the Fifth Amendment should not be dismissed.
SO ORDERED.
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01-03-2023
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07-25-2022
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https://www.courtlistener.com/api/rest/v3/opinions/3432528/
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[1] This action was commenced in the district court of Polk county, Iowa, to restrain the clerk of the municipal court of the city of Des Moines, and its bailiff, respectively, from issuing and levying an execution upon, and for the cancellation of, a judgment for $135, entered in that court against the defendants there, and plaintiffs here, in favor of the "Capital Loan Company," plaintiff, which it is now alleged is not a legal entity, but merely a trade name. The defendants herein filed a motion to dismiss this action because (1) it is brought to restrain proceedings upon a judgment entered in another court; (2) because a person may sue or be sued in his trade name; and (3) because the appellants duly appeared in the action in the municipal court, without raising the objection complained of here. That the failure to raise such objection there constitutes a waiver thereof. The motion was sustained by the lower court, and plaintiffs appeal.
I. The instant action was commenced in the district court of Polk county, Iowa. The court in which the judgment complained of was rendered was the municipal court of the city of Des Moines. A municipal court is a court of record, and has concurrent jurisdiction with the district court in all civil matters, with a few exceptions not pertinent herein. Code, sections 10654 and 10655. It is a separate court, and the same rules applicable to district courts apply to municipal courts. Code 1931, section 10664.
It is the well-settled law of this state that:
"When proceedings in a civil action, or on a judgment or final order, are sought to be enjoined, the action must be brought in the county and court in which such action is pending or the judgment * * * obtained." Code 1931, section 12527.
Bankers Trust Co. v. Scott, 215 Iowa 1107, 246 N.W. 836. This court has repeatedly held that an action will not lie in one county to enjoin proceedings in another county and court, on a judgment therein rendered, even though the plaintiff's action is based upon the claim that the judgment is wholly void. Ferris v. Grimes, 204 Iowa 587, 215 N.W. 646; Hawkeye Ins. Co. v. Huston,115 Iowa 621, 89 N.W. 29; Lockwood v. Kitteringham, 42 Iowa 257 *Page 157
; Anderson v. Hall, 48 Iowa 346; Bennett v. Hanchett, 49 Iowa 71; Grattan v. Matteson, 51 Iowa 622, 2 N.W. 432; Ulber v. Dunn,143 Iowa 260, 119 N.W. 269; Brunk v. Moulton Bank, 121 Iowa 14, 95 N.W. 238; Bankers Trust Company v. Scott, 215 Iowa 1107, 246 N.W. 836.
It will be noted that the statute provides that an action seeking to enjoin proceedings on a judgment must be brought in the county "and court" in which such action is pending or the judgment obtained. The statute is not limited to the county, but requires the action to be brought in the same court in which judgment was obtained.
This being an action for an injunction to restrain proceedings on a judgment in a civil action, it should have been brought in the court in which the judgment was obtained.
[2] II. Appellants contend that, because the action in the municipal court was commenced and tried in a "Trade Name" only, as plaintiff, without any separate appearance by the owners of the business, there was in fact no party plaintiff, and that the judgment entered therein is therefore void. The record shows that the judgment sought to be canceled was obtained in an action wherein the plaintiff was designated by a trade name as the "Capital Loan Company" v. Charles F. Keeling, Sheriff, and L.W. Karlen, Defendants.
It is the settled rule of law in this state that an action may be prosecuted or defended in a trade name. Enslow Son v. Ennis,155 Iowa 266, 135 N.W. 1105; Swanson Automobile Co. v. Stone,187 Iowa 309, 174 N.W. 247.
In Enslow Son v. Ennis, supra, loc. cit 270, we said:
"Moreover, while the petition is entitled in the name of `D.A. Enslow Son,' it is not alleged therein that the plaintiff is a partnership. Therefore we have a case wherein it appears that an individual, contracting in his own right, has used a trade name. He might sue, therefore, either in his own name or in the name used in the transaction, * * * and the rendering of judgment in favor of the real party in interest could not be prejudicial to the defendant. Hartkemeyer Co. v. Griffith, 142 Iowa 694, 121 N.W. 372."
In the case of Swanson Automobile Co. v. Stone, supra, loc. cit. 313, we said:
"Appellant makes the point that the action, not being brought in the name of the real party in interest, should be dismissed. The *Page 158
objection is not well taken. Under the law of this state, a man may lawfully adopt any trade name in which to conduct his business, and, so long as it is not made a cover or means of fraud, he may sue or be sued by such designation."
So in this case it must be assumed from the record that, when the "Capital Loan Company" secured a judgment against the defendants, who are plaintiffs herein, such judgment must have been secured upon a liability created under a contract with the owners of the business conducted in the trade name of "Capital Loan Company." A trade name, when duly registered, is recognized under the statutes of this state. Section 9866-a1. The record in this case shows that the trade name "Capital Loan Company" was duly registered as provided by said section. Under the doctrine laid down in the cases hereinabove cited, a person conducting a business in a trade name may sue or be sued under such designation so long as it is not made a covering for some means of fraud. As the plaintiffs in this case duly appeared as defendants in the action commenced against them in the municipal court of the city of Des Moines, and inasmuch as a judgment was duly entered against them, under an appearance giving the court jurisdiction of them, we are unable to see how they are in any manner prejudiced thereby.
[3] Furthermore, any objection based upon plaintiff's incapacity to sue in that action should have been taken advantage of by the defendants in that action, before pleading to the merits of the case, and a failure so to do constituted a waiver thereof. Calnan Construction Co. v. Brown, 110 Iowa 37, 81 N.W. 163; 47 C.J pp. 183, 184, 185, 188, sections 338, 339, 345, 350.
"An objection based upon plaintiff's incapacity to sue should ordinarily be taken advantage of by defendant at his first opportunity, and before trial, verdict, or judgment. Defendant admits plaintiff's capacity to sue when he pleads to the merits, or files a counterclaim, or files his answer pending a demurrer for incapacity to sue. Failure to object at the proper time, as by demurrer or answer, constitutes a waiver of an objection based upon plaintiff's capacity to sue. Defendant waives the objection by answering over, pending decision on his objection, or after an adverse decision." 47 C.J. 184, section 345. *Page 159
For the reasons hereinabove set out, we are constrained to hold that the action of the lower court in dismissing plaintiff's petition was right, and the judgment is therefore hereby affirmed.
MITCHELL, C.J., and STEVENS, CLAUSSEN, and ANDERSON, JJ., concur.
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432547/
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Under an information filed by the county attorney of Mahaska county, Iowa, the defendant, E.B. (Lash) Ferguson, and his son, Ben Ferguson, were jointly charged with the crime of larceny in stealing, taking and carrying away eleven head of cattle which were the property of Vernie Braden. The defendant, E.B. (Lash) Ferguson, was tried separately and found guilty, and judgment was entered upon the verdict thus rendered. From such judgment and rulings of the court, said defendant appeals.
I. In considering the alleged errors upon which defendant relies for reversal, we shall first take up the last of these alleged errors, because this alleged error goes to the facts of the case which it will be well to understand at the outset. The defendant lived at a little settlement known as Union Mills, in Mahaska county, where he had a pasture in which he kept cattle owned by him. Vernie Braden had a pasture about three miles east of Union Mills in which he pastured thirty-five head of cattle, twenty-three of which belonged to him. Thirteen of Braden's cattle were black. All of the thirty-five head of cattle were in the pasture on June 10, but on June 17, when Braden next visited the pasture, eleven of his cattle (nine black and two red) were missing. Between the defendant's pasture and the Braden pasture there is a road which extends southward from the defendant's pasture about a mile, then eastward for about three miles, then northward over a bridge across the north Skunk river. From the place where the road crosses the north Skunk river there is a road on which, by going northward, then westward, and then southward, one can go from the bridge to Union Mills. The Braden pasture was on the east side of the road where it crossed the north Skunk river, and just north of the north end of the bridge there was a gate opening into the Braden pasture. For quite a distance both north and south of this bridge and on both sides of the road there was considerable timber and brush. There was no house nearer than approximately one-fourth of a mile of the bridge, and neither the bridge nor the gate into the Braden pasture was visible from any of the houses in the vicinity. There is evidence tending to show that between about 11:30 o'clock in the forenoon of June 10, 1935, and sometime after noon on that day, the defendant, E.B. (Lash) Ferguson, was seen herding a bunch of cattle estimated variously at from 15 to 25 head along the east and west road which we have described as *Page 1151
extending between Union Mills and the bridge over the north Skunk river. When first seen along this road the defendant was perhaps a mile and a half to two miles south and west of the bridge. Between that point and the bridge he was seen by other witnesses, the last of these witnesses having seen him at a point a little more than a quarter of a mile south and west of the bridge. Some of these witnesses also saw the defendant's son, Ben Ferguson, riding in a gray colored automobile and apparently helping his father herd the cattle along the road. All of these witnesses state that at the time they saw the defendant herding his cattle, which was before the cattle crossed the bridge, there were no black cattle among them. There is further testimony that in the afternoon of the same day, E.B. Ferguson and his son were seen driving a bunch of cattle on the road north of the bridge, and that when first seen north of the bridge there were probably from eight to ten black cattle among the cattle in the herd. Between that time and seven or eight o'clock in the evening of the same day the defendant and his son, Ben Ferguson, were seen by several witnesses at different points along the road which extends northward and westward and then southward between the bridge and Union Mills, and these witnesses testify that the defendant and his son were driving a bunch of cattle estimated variously from 20 to 35 head, in which there were several head of black cattle. There is evidence that, on the same night, defendant's son, Ben Ferguson, called at the home of one Phillips, who conducted a trucking business at New Sharon, Iowa, and engaged Phillips to go to the defendant's place at Union Mills on the following morning to haul some stock. The testimony of Phillips shows that on the following morning he went to the defendant's place where eleven head of cattle, some black and some red, were loaded onto his truck; that he was directed by the defendant to haul these cattle to the sales barn at Toledo, Iowa, and that the defendant accompanied him in the truck to the sales barn at Toledo, Iowa, where the cattle were unloaded. There is further evidence that, while passing through New Sharon on the trip to Toledo, the defendant was seen in company with Phillips. While the man who received the stock at the sales barn at Toledo was not able to recognize the defendant as the person who came in the truck, he did testify that there was a man accompanying Phillips when the stock was delivered, and that this man told him to list the stock under the name *Page 1152
Moore. Later, on the same day, and before the stock was sold, one of the men connected with the sales barn was told to change the name under which the stock was listed to Ferguson. This instruction was given by another son of the defendant, Cleo Ferguson, who was acting as one of the auctioneers at the sales barn. The eleven head of cattle which came to the sales barn in the Phillips truck were sold on that afternoon, four of them being bought by a man connected with the sales barn, by whom they were later sold to another party. The pasture in which the cattle were kept was some distance from the Braden house and the cattle were not missed from the pasture until about the 17th day of June, when an investigation was started. Braden and the deputy sheriff of Mahaska county went to the sales barn at Toledo, and from there they were accompanied by a man connected with the sales barn to the places of the different farmers who had purchased the eleven head of cattle brought to the barn in the Phillips truck. Braden identified the cattle missing from his pasture among the cattle at the different farms visited, and all of the cattle thus identified by him were brought back to the sales barn and were later returned to the Braden farm. Settlement for the eleven head of cattle brought to the sales barn in the Phillips truck was made with Cleo Ferguson, a son of defendant. It is true, there was evidence presented by the defendant tending to show that he had black cattle among the cattle owned by him on and prior to the 10th day of June, and that he was not at Toledo, Iowa, at the time the State claimed he had gone there in the Phillips truck. There was further evidence tending to show that the defendant was a man of good character, and also evidence tending to impeach the witness, Phillips.
Appellant contends that the trial court erred in overruling the defendant's motion for a new trial on the grounds that the verdict was not supported by the evidence and was contrary to the weight of the evidence, and in refusing to submit instructions requested by appellant directing the jury to return a verdict for the defendant. We do not think there can be any doubt that the evidence, as a whole, was abundantly sufficient to sustain the verdict rendered by the jury, and the trial court did not err in refusing the instructions requested and in submitting the case to the jury.
[1] II. Defendant relies for reversal upon error which he claims is found in the court's instruction on circumstantial *Page 1153
evidence, and in the court's refusal to give an instruction requested by him. The instruction given by the court defined both direct and circumstantial evidence and explained the difference between them. It told the jury that, if the facts and circumstances shown by such circumstantial evidence were sufficient to satisfy their minds of the guilt of the defendant, beyond a reasonable doubt, such evidence would be sufficient to authorize the jury to render a verdict of guilty. It further told the jury that to warrant a conviction, however, the facts and circumstances proved must not only be consistent with defendant's guilt but they must be inconsistent with any rational theory of innocence. The instruction on circumstantial evidence asked by the defendant and refused by the court contained the following statement:
"To warrant a conviction on circumstantial evidence, each fact in the chain of circumstances necessary to be established to prove the guilt of the accused must be proven by competent evidence beyond a reasonable doubt, and all the facts and circumstances necessary to prove guilt must be connected with each other and with the main fact sought to be proved; and all the circumstances, taken together, must be of a conclusive nature, leading to a satisfactory conclusion and producing a moral certainty that the crime charged was committed, and that the accused committed it. It is not sufficient that they coincide with and render probable the guilt of the accused, but they must exclude every other reasonable hypothesis."
Another requested instruction asked the court to tell the jury that "each circumstance essential to the conclusion of the defendant's guilt should be fully established in the same manner and to the same extent as if the whole issue rested upon it."
It is the contention of the appellant that the matters covered in the instruction requested were not submitted to the jury in the instruction given by the court, and that they were such as should have been given to the jury in connection with its consideration of circumstantial evidence. In support of this contention appellant cites State v. Blydenburg, 135 Iowa 264, 112 N.W. 634, 14 Ann. Cas. 443; State v. Clark, 145 Iowa 731, 122 N.W. 957; State v. Brazzell, 168 Iowa 480, 150 N.W. 683. Other cases were also cited which, in our opinion, do not go to the proposition here raised. In the Blydenburg case an instruction very similar to the instruction requested in this case was refused, but this *Page 1154
court found that the law as contained in the requested instruction had been substantially given in the court's instruction. The language used in that opinion indicates that particular stress was placed upon the fact that the instruction requested was proper in that case because all the evidence in the case was circumstantial. In the Clark case a general instruction was asked on the subject of circumstantial evidence, to the effect that every fact necessary to a conviction must be proved beyond a reasonable doubt. In that case, likewise, all of the evidence was circumstantial, including the evidence on the unexplained possession of recently stolen property, and, because of the importance of this circumstance, this court said that the jury should have been instructed that such fact must be proved beyond reasonable doubt, and that the instruction requested should have been given. In the Brazzell case the evidence was likewise entirely circumstantial and the court gave a general instruction covering both direct and circumstantial evidence, but refused to give an instruction that, where a conviction is sought on circumstantial evidence, each circumstance necessary to a conclusion of guilt must be fully and fairly proven and that, if there was a reasonable doubt as to the evidence being sufficient to prove such circumstances, the verdict should be, not guilty. The court's instruction was held erroneous because it did not distinctly inform the jury that the guilt of the accused depended exclusively upon circumstantial evidence, and because, under such instruction, the jury might well have confused direct testimony of a mere collateral fact or circumstance with direct evidence of appellant's guilt.
In the instant case, however, the evidence was not exclusively circumstantial. There was direct evidence that the cattle which were taken from the Braden pasture were the same cattle as those sold at Toledo on the 11th day of June, and there was the evidence of the truckman that these cattle were loaded by him at defendant's place, in the presence of and under the direction of the defendant, and that the defendant accompanied him in his truck from defendant's place of residence to the sales barn at Toledo. In its instructions the court fully instructed the jury as to the material facts that must be proved and that these facts must be proved beyond a reasonable doubt. It fully explained to the jury the meaning of the term reasonable doubt, and in its instruction No. 10, which is here attacked, it correctly defined *Page 1155
and described the meaning of direct and circumstantial evidence and told the jury that, in order to convict upon circumstantial evidence alone, the facts and circumstances must not only be consistent with defendant's guilt, but they must be inconsistent with any rational theory of innocence. We know of no case in which this court has held that, where the evidence is both direct and circumstantial, an instruction such as that given by the court is insufficient, and that it is error to refuse to give an instruction such as that requested by the appellant.
[2] III. It is next claimed that the court erred in giving its instruction No. 11, which is as follows:
"The fact, if you find it to be a fact, that the cattle as described in the information were stolen from the premises of Vernie Braden and were soon thereafter found in the possession of the defendant, if so shown, may be considered by you as a circumstance tending to show that the defendant is the party, who took the cattle unless such possession has been explained."
(Italics are ours.)
The words which we have italicized have been printed in capitals in the appellant's argument, and these words appear to comprise the part of the instruction upon which particular stress is laid as being prejudicial. The argument appears to be that, because the appellant in this case denied the possession of the stolen property and did not attempt to make any explanation of the possession of such stolen property, the use of the phrase containing the words italicized was erroneous and prejudicial. According to appellant's contention, if the last phrase in reference to an explanation had been omitted, the instruction would have been appropriate to the facts of this case; but, because the defendant attempted no explanation, it is prejudicial to make any reference to an explanation. Our attention is called to the case of Richardson v. State, (Tex. Cr. App.) 42 S.W. 996, which seems to have adopted this rule; but the appellant has not cited, and our attention has not been called, to any other case in which such a rule has been followed. The instruction here involved does not, in our opinion, put the burden of explaining possession on the defendant. In effect, it does no more than tell the jury that the unexplained possession of stolen property soon after the theft thereof may be considered as a circumstance tending to show that the party in possession was the party who stole it. *Page 1156
The explanation of possession might come from defendant or it might come from other facts and circumstances in evidence. State v. Brady, 121 Iowa 561, 97 N.W. 62, 12 L.R.A. (N.S.) 199; State v. Perry, 165 Iowa 215, 145 N.W. 56; State v. Fortune, 196 Iowa 995, 195 N.W. 740.
[3] IV. It is next contended that the court erred in its instruction No. 13, on good character, and in refusing instructions on this matter requested by the defendant. The court's instruction No. 13 was as follows:
"You are instructed that in passing upon the guilt or innocence of the defendant, good character, if you find such good character as to morality and honesty has been established by the evidence, constitutes an ingredient to be considered by you without reference to the apparently conclusive or inconclusive character of the other evidence; and it is for you to determine what weight such evidence shall have with you."
Instruction No. 2 asked by the defendant was as follows:
"You are instructed that the good character of the defendant as it has been established may itself, in connection with all the evidence, generate a reasonable doubt and entitle the defendant to an acquittal, even though without such proof you would convict."
Instruction No. 6 requested by appellant contained this statement:
"You are instructed that the previous good character of the defendant, if proved to your satisfaction in this case, you ought to consider, together with all the other facts in evidence, in passing upon the question of his guilt or innocence, for the law presumes that a man whose character is good is less likely to commit a crime than one whose character is not good."
It will be noted that, in the instruction given by the court, the jury is merely told that, if they find that the defendant's character as to morality and honesty has been established, they may consider such evidence without reference to the conclusiveness or unconclusiveness of other evidence, and determine what weight they will give it. Nothing is contained in the instruction as to the purpose for which this evidence may be considered. The jury is nowhere told that, if they find that the defendant's *Page 1157
character for morality and honesty is good, they may consider such evidence in determining whether a man of such good character for morality and honesty would be apt to commit the crime with which defendant is accused. The jury is nowhere told that, if they find the defendant's character for morality and honesty to be good and, if in considering this evidence with other evidence in the case they entertain a reasonable doubt as to defendant's guilt because of his good character, they should acquit him. Whether the neglect to instruct in regard to these matters would amount to prejudicial error in the absence of any requested instruction in regard to them, we need not determine, because the defendant did ask the court to give such instructions. It is well established law that evidence as to good character may be considered by a jury along with all the other evidence, and that, in reaching a verdict, they may consider whether a man of such good character as they find the accused to possess would be liable to commit the crime with which he is charged. It is also well established law that, if the evidence as to defendant's good character, when considered along with all other evidence, causes the jury to have a reasonable doubt of the guilt of the defendant, they should acquit him. The instruction given did not convey this information to the jury, and the court refused to give the requested instructions, or their equivalent, in which this information would have been given to the jury.
Appellee contends that, in any event, there was no prejudicial error in the instruction given by the court, because all of the evidence of good character attempted to be shown by the appellant was insufficient for that purpose; because this evidence attempted to show a good reputation based merely upon the experience of the witnesses with the defendant; and because the evidence presented by appellee on rebuttal showed that the actual reputation and character of the defendant in the community in which he lived were bad. The matter here involved was not reputation merely, but the real character of the defendant. Such character, it is true, might be shown by general reputation, but it does not follow that it could not also be shown by actual personal experience of the witness with the defendant. State v. Sterrett, 68 Iowa 76, 25 N.W. 936; State v. Cather, 121 Iowa 106, 96 N.W. 722. We do not think it can be said, as a matter of law, that there was no evidence as to the defendant's reputation and character which the jury might consider, and we do *Page 1158
not think that the testimony offered by the appellee in rebuttal can be said to establish, as a matter of law, that the defendant's reputation and character were bad. We are constrained to hold that, in refusing to give the instructions requested by the defendant, or their equivalent, the court was guilty of prejudicial error. State v. Reynard, 205 Iowa 220, 217 N.W. 812.
[4] V. In its instruction No. 9 the court, in defining reasonable doubt, among other things, told the jury that a reasonable doubt "means a doubt which without being sought after fairly and naturally arises in the mind after a careful and candid consideration of all the evidence in the case, both for the State and for the defendant." Immediately thereafter, in the same instruction, the court proceeded to tell the jury that, "If, after such careful and candid consideration of all of the evidence in the case, or lack of evidence, the minds and consciences of the jurors are not firmly and abidingly satisfied of the defendant's guilt, the doubt is a reasonable one and you should acquit." Appellant complains of the instruction given by the court and of the court's refusal to give an instruction asked by appellant which, among other things, told the jury that a reasonable doubt "means a doubt which, without being sought after, fairly and naturally arises in the mind, after a fair and candid consideration of all the evidence in the case, both for the State and for the defendant. If, after such consideration, the minds and consciences of the jurors are not firmly and abidingly satisfied of the defendant's guilt, the doubt is a reasonable one, and you should acquit. * * * A reasonable doubt may arise from the lack, or want of evidence, as well as, out of the evidence in the case."
Appellant's complaint is that the first paragraph of the court's instruction which told the jury that a reasonable doubt is one which "naturally arises in the mind after a careful and candid consideration of all the evidence in the case, both for the State and for the defendant," did not tell the jury that such reasonable doubt might arise from the lack or want of evidence as well as from the evidence presented. The court's instruction plainly told the jury that if, after a consideration of all the evidence, or lack of evidence, they were not firmly and abidingly satisfied with the defendant's guilt, the doubt would be a reasonable one and they should acquit the defendant. We are unable to see why this statement does not as clearly convey to the jury the *Page 1159
thought that a reasonable doubt may arise from the lack of evidence, as does the statement contained in the instruction asked by the appellant. We think the objection is hypercritical. We find no error in the instruction given by the court or in its refusal to give the instruction asked by the appellant.
[5] VI. Appellant complains of the ruling of the court in excluding the evidence offered by a witness in behalf of the defendant for the purpose of impeaching the state's witness, Harold Phillips, who testified to having hauled eleven head of cattle from defendant's place in Union Mills to Toledo.
The witness testified to an acquaintance with said Phillips, extending over a period of fifteen or sixteen years. He was then asked if he knew the reputation of Phillips in the community in which he lived for honesty, integrity and good citizenship. The question was objected to as not calling for any grounds of impeachment, and the objection was sustained. Defendant then offered to show that, if allowed to testify, the witness would answer that he knew the reputation of Phillips in the community where he resides for honesty, integrity and good citizenship, and that the witness would testify that such reputation is bad. To this offer the state objected on the ground that reputation as to the respects for which the testimony was offered, however bad, could not be considered as impeaching testimony under the statute. It is quite apparent that the testimony was offered as impeachment under section 11271 of the Code, which provides that "the general moral character of a witness may be proved for the purpose of testing his credibility." Our cases construing this statute hold that, while the words "general moral character" are used, the statute refers to general reputation and not to the person's character, as known to the witness, independent of his reputation. State v. Egan, 59 Iowa 636, 13 N.W. 730; State v. Seevers, 108 Iowa 738, 78 N.W. 705; State v. Gregory, 148 Iowa 152, 126 N.W. 1109.
The general moral character of a witness, whom it is attempted to impeach under this statute, should not be confused with the character of an accused when put in issue. As it is general reputation or general moral character that is referred to in the statute, the evidence as to such reputation is confined to general reputation and not to particular traits or characteristics. State v. Seevers, 108 Iowa 738, 78 N.W. 705; Kilburn v. Mullen, 22 Iowa 498; State v. Gregory, 148 Iowa 152, *Page 1160
126 N.W. 1109; 70 C.J. 820, 821, 907, 912. We find no error in the ruling of the court excluding the evidence of this witness.
[6] VII. The defendant complains of the ruling of the court on the testimony of J.E. Seibert, a witness for the defendant, who offered to testify as to the general moral character of the defendant for honesty, integrity and good citizenship. The witness, Seibert, testified that he had known the defendant for thirty years. He was asked if he knew the reputation of the defendant in the community where he resides prior to June 10, 1935, for honesty, integrity and good citizenship. On being told to answer the question by yes or no, he answered that he did not know anything about the defendant living out there; "it is just my business experience." The witness was then excused but later recalled and asked as to his business experience with the defendant and stated that he had known the defendant for thirty years, had done business with him during that time and had known him well during that time. He was then asked whether from his knowledge of the defendant and his dealings with him he knew the defendant's general moral character for integrity, good citizenship and honesty prior to June 10, 1935. The state objected to the testimony as incompetent, irrelevant and immaterial because the witness was not qualified for the opinion, and for the further reason that the question called for an opinion based upon facts which are not recognized in the law as amounting to a defense. The objection was overruled and the witness answered: "All I can say is all business transactions had with him were perfectly satisfactory." A motion to strike the answer was overruled. The witness was then asked, basing his answer on what he knew of the defendant, if he knew the defendant's general moral character for honesty, integrity and good citizenship, and an objection by the state to this question was sustained. He was then asked whether he would say that the defendant's moral character, from what he knew of him, was good or bad prior to June 10, 1935, and an objection of the state to this question was sustained. The appellee contends that there was no error in sustaining this objection, because (a) the question was not limited to the time immediately preceding the occurrence in question and the returning of the indictment; (b) because the witness disqualified himself from answering by his own direct examination; and (c) because there was no offer of proof made to show whether appellant's character was good or bad. The questions *Page 1161
asked show that they refer to a time prior to the indictment and we do not think that they should have been excluded because they did not expressly confine the time to the period covered by the occurrences in question up to the time of the indictment. It is true the witness stated that he did not know anything about the defendant living out there, apparently meaning at Union Mills, and that all he could say was that all business transactions he had with the defendant were perfectly satisfactory. He stated, however, that he had known the defendant for thirty years, that he was well acquainted with him and had done business with him during that time. He was not allowed to answer a question as to whether, basing his statement on what he knew of Ferguson, he knew his moral character for honesty, integrity and good citizenship, and he was not allowed to state from what he knew of the defendant whether his moral character was good or bad. It seems to be well settled in the law that a defendant can put his moral character in issue, as was apparently attempted to be done by this witness. 16 C.J. 580; State v. Donovan, 61 Iowa 278, 16 N.W. 130; State v. Lindley, 51 Iowa 343, 1 N.W. 484, 33 Am. Rep. 139; State v. Northrup, 48 Iowa 583, 30 Am. Rep. 408; State v. Turner, 19 Iowa 144; State v. Rutledge, 135 Iowa 581, 113 N.W. 461; State v. Johnson, 211 Iowa 874, 234 N.W. 263. It also seems well established that the good character offered by an accused may and must relate particularly to that trait of character which is involved in the crime charged. 16 C.J. 582; State v. Dexter,115 Iowa 678, 87 N.W. 417; State v. Cather, 121 Iowa 106, 96 N.W. 722; State v. Wolf, 112 Iowa 458, 84 N.W. 536. It is true that in some jurisdictions witnesses are confined to testimony as to the general reputation of the defendant, and cannot testify as to what they know of the defendant, or as to his disposition, or give their opinion as to his character or disposition, from their personal observation or experience. 16 C.J. 583. In this state, however, the rule seems to be otherwise, and the real character of the defendant may be shown. This may be shown, it is true, by general reputation, but it may also be shown by what a witness knows of the defendant from his personal observation or experience with him. State v. Sterrett, 68 Iowa 76, 25 N.W. 936; State v. Cross, 68 Iowa 180, 26 N.W. 62; State v. Cather,121 Iowa 106, 96 N.W. 722; State v. Richards, 126 Iowa 497, 102 N.W. 329. We think the testimony of the witness shows that he was sufficiently acquainted with the *Page 1162
defendant to be able to say whether the defendant's general moral character for honesty, integrity and good citizenship was good or bad and that he should have been allowed to do so. Appellee contends that the refusal to allow this witness to answer was in any event not prejudicial because no offer of proof was made to show whether defendant's character was good or bad. We think the examination of this witness sufficiently shows that the defendant was offering to prove by the witness what his general moral character was as to honesty, integrity and good citizenship. It seems to us that the traits of character concerning which the witness was interrogated were involved in the crime with which he was charged. No authority is offered by appellee to the contrary, and no authority is offered in support of the contention that it was necessary to make a further offer after the witnesses were not allowed to answer the questions put to them.
[7] VIII. Further errors are alleged to have been committed by the court in allowing two witnesses named Lloyd to testify in rebuttal that sometime in the latter part of May the defendant came to the Lloyd home about 3:30 o'clock in the morning and telephoned to Harold Phillips at New Sharon, at which time they heard him say over the telephone, in substance, that the deal was off, that they didn't get the cattle rounded up; in admitting the testimony of a witness, Clark, as to a conversation with Cleo Ferguson, a son of the defendant, which took place at the sales barn in Toledo, Iowa, on June 11th, the day on which the cattle were sold, in reference to changing the name under which the cattle were listed from Moore to Ferguson; and in admitting the testimony of the plaintiff's witness, Phillips, as to a conversation between the witness and Ben Ferguson, the defendant's son, on the night before Phillips claims to have gone to the defendant's place at Union Mills and hauled the cattle from there to Toledo. We think all of these matters were circumstances which, however slight, were relevant and material in establishing the chain of evidence against the defendant. There was nothing in any of this evidence which, in and of itself, amounted to an admission by the defendant or by anyone authorized to speak for him, and no such claim was made for it by appellee; but we think that the matters thus introduced in evidence were such that they might properly be considered by the jury in determining *Page 1163
what, if any, connection the defendant had with the theft of the cattle which the state claims was committed by him.
IX. Appellant complains of the court's ruling in sustaining objections of the state to the cross-examination, by the defendant's attorney, of witnesses offered by the state to show that the appellant's reputation for general moral character and for honesty, integrity and good citizenship were bad prior to June 10, 1935. On cross-examination appellant's attorney asked these witnesses whether or not they had ever heard of the defendant being arrested prior to June 10, 1935, and on objection of the state the witnesses were not allowed to answer. Appellant then offered to show by the witnesses that, if allowed to answer, they would state that they had never heard of the defendant being arrested prior to June 10, 1935. Similar questions were asked the witnesses in regard to whether they had ever heard of the defendant taking a drink; whether they had known of him paying his debts; whether they would say that a man who does not drink, smoke, run around at night, and who attends church regularly, was not a man whose moral character was good. In State v. Gordon,3 Iowa 409, l.c. 415, the trial court permitted the state, on cross-examination of a witness for the defense, who had been called as to the good character of the defendant, to go into proof of particular facts or difficulties on the part of the defendant, and this court held that, in doing so, the trial court erred. Considering the question there raised this court said:
"It is evidence of character, which is admissible, which of course is to be confined to the trait of character which is in issue, or, as it is expressed by some of the writers, the evidence ought to have some analogy and reference to the nature of the charge. But the examination must be confined simply to the general character or reputation, and neither can ask questions as to particular facts or difficulties." (Citing cases.)
The rule announced in the Gordon case has been approved and followed in numerous cases in this state, and is the same as the rule in most, if not all, jurisdictions. See 22 C.J. 481, section 579; State v. Dexter, 115 Iowa 678, 87 N.W. 417. We find no error upon the part of the trial court in refusing to allow the defendant to go into the matters concerning which the witnesses were attempted to be interrogated.
For the reasons stated in Divisions IV and VII of the *Page 1164
opinion, we feel constrained to hold that the court erred as to matters there considered, and that the case must be, and is hereby, reversed. — Reversed.
RICHARDS, C.J., and KINTZINGER, PARSONS, and HAMILTON, JJ., concur.
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One Skriver owned a farm in Harrison County. On July 20, 1922, he and his wife executed a real estate mortgage on said premises, which was duly recorded on July 27, 1922, and subsequently assigned to the appellee. Title to the premises passed to the defendants Sheffer and Jardine by a warranty deed dated January 19, 1925, and recorded April 14, 1925. Said real estate mortgage upon the premises contained the following provision:
"And the said parties of the first part do hereby pledge the rents, issues and profits of the said real property for the payment of said principal sum, interest, attorney's fees and costs and authorize, agree and consent that in case of any default in the payments above provided for, or breach of any of the conditions herein contained and upon the filing of a bill or petition for the foreclosure of this mortgage the court in which said suit shall be instituted, or any judge thereof shall at the commencement of said action, or at any stage during the pendency or progress of said case on application to the plaintiff and without notice to the party of the first part appoint a receiver to take *Page 1193
possession of the said property and to collect and receive the rents and profits thereof, and to apply the same to the payment of said debt, interest, attorney's fees, costs and taxes and to make necessary repairs."
Sheffer and Jardine leased said premises for the term beginning March 1, 1925, and ending March 1, 1926, the lease providing that the said lessors should receive as rental for said premises one half of all of the corn raised upon said premises during the said term, and $50 cash rent. The tenant under said lease was in possession of said premises after March 1, 1925, and raised a crop of corn on said premises during that year. On June 30, 1925, Sheffer and Jardine executed to the appellant, the First National Bank of Greenwood, Nebraska, a chattel mortgage upon their "one-half interest in the 1925 corn crop situated upon" said described real estate. This chattel mortgage was executed in the state of Nebraska. On August 20, 1925, the appellee Hanson filed his petition and commenced this action for the foreclosure of the said real estate mortgage, and therein prayed the appointment of a receiver to collect the rents and profits from said real estate and apply them to the satisfaction of said mortgage. Thereafter, to wit, on August 29, 1925, the said chattel mortgage upon the landlord's share of the corn crop then on said premises was duly filed for record in Harrison County, Iowa. On October 16, 1925, a receiver was appointed by the court, who took possession of the landlord's share of said corn, and the same has been converted into money, and the receiver now holds same under the order of court. The appellant bank intervened in said action, setting up its said chattel mortgage and claiming the said rentals thereunder. The court by its decree awarded said crop of corn grown on said premises for the year 1925 to the receiver. The intervening bank has appealed, and the sole question for our determination on this appeal is whether the receiver, under the foreclosure of said real estate, or the intervener bank, under its chattel mortgage, is entitled to the share of the landlord in the crops grown on said premises during the season of 1925.
We have repeatedly held that a mortgagee under a real estate mortgage containing a receivership clause similar to the one involved in this case does not obtain any lien upon the crops grown on the mortgaged premises, at least until the commencement *Page 1194
of the suit in foreclosure in which the appointment of a receiver is sought. In this case the action was begun August 20, 1925. At that time the crops in question were in being on said premises, and a mortgage had been given thereon after they came into being, to wit, on June 30, 1925.
No question of notice, either actual or constructive, is involved. Before the appellee acquired any right to said crops under his action in foreclosure, the crop was in being, and had been mortgaged by the then owners of the real estate to the intervener. In such a situation, the lien of the intervener under its chattel mortgage was superior to the rights of the receiver to the crop then in existence.
For discussion of the principles involved, see Louis v. Hansen,205 Iowa 1216, and King v. Good, 205 Iowa 1203, and cases cited therein.
The decree of the trial court is — Reversed.
STEVENS, C.J., and EVANS, KINDIG, and WAGNER, JJ., concur
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The action is by a widow, for the setting off of her distributive share in the land left by her deceased husband. The husband died testate, seized of 160 acres of land. By his will, which was duly admitted to probate, he gave his widow, the plaintiff and appellant, a life estate in all his property, both real and personal, after the payment of his debts. The only question in the case arises between the appellant, who claims a right to, and that she did by the commencement of this proceeding, elect to take her distributive share, and the appellee First National Bank, a creditor of the estate, claiming that the appellant had previously elected to take under the will.
The case was tried below on the same evidence submitted in an action by the bank against the appellant on certain notes, which was before this court in First Nat. Bank v. Phillips, 203 Iowa 372.
The testator died in 1922. The controlling statute in force at that time was Chapter 192, Acts of the Thirty-eighth General Assembly. That statute was not, in any respect now important, essentially different from the prior statute, Section 3376, Code *Page 80
Supplement of 1913. The present corresponding provisions are found in Sections 12006 et seq., Code of 1924.
The appellant did not make in open court, or file, any formal election to take under the will, and no notice requiring her to make an election was served upon her by the executor or other interested person.
In In re Estate of Emerson, 191 Iowa 900, we had occasion to consider Section 3376, Code Supplement, 1913, and said:
"Under the present law, the widow may elect to accept under the provisions of the will at any time, and this fact may be established by any competent evidence. Such an election, therefore, need not be made within six months, nor is an election of record necessary, except as provided in Section 3376."
See, also, Nick v. Nick, 195 Iowa 351. Appellant might make a valid and binding election to take under the will, without doing so in open court or by a formal writing filed in court. Indeed, we do not understand appellant to contend otherwise. Her contention is that the facts shown do not establish such an election on her part.
It appears without dispute that, after the death of the testator, the appellant took possession of all the personal property on the farm and of the whole 160 acres, and used all of the property as her own. This was all of the property of the estate. She rented the land to one of her sons, and received all of the rent, not accounting to either of the children for any part of it. This arrangement continued from 1922 up to the commencement of the present proceeding, in 1925. We understand that none of the personal property was set off to her as exempt. She traded a car left by the testator for a new one, and sold one half of the personal property to one of her sons. Appellant claims that she so acted under an agreement with the appellee bank that, when the debts of the estate owed to others than the bank were paid, a second mortgage, subject to a prior mortgage of $9,600, should be given to the bank, to secure its claim; and that she used the rent and proceeds of the personal property to pay the other debts of the estate.
In 1922, shortly after the will was admitted to probate, the appellant and the executor of the estate, who was one of the sons, joined in an application to the court for an order authorizing the executor to borrow $6,000 and secure its payment by a second *Page 81
mortgage on the land. In the application it was recited that by the will the appellant was given a life estate in all of the estate, and that on her death it was to go to the three sons. The other two sons accepted notice of the application, and the order prayed was made by the court. Nothing was done under this order, and the arrangement with the bank was not carried out, because of unpaid back interest on the first mortgage of $9,600. The appellant herself offered no explanation of the recitals in the application. The attorney who prepared it testified that she was not present when it was prepared, and, so far as he knew, had no knowledge of its allegations. She was, however, fully conversant with the plan to mortgage the land. Practically all of the claims filed against the estate, except that of the bank, have been paid.
There is in the record evidence of some declarations by the appellant that she did not intend to accept the will. They are contradicted by her acts in taking possession of all the real estate and personal property, and renting the former and disposing of the latter, as well as by the recitals in the application filed by her and the executor for authority to mortgage the land. The fact that she used the rents and the proceeds of the personal property and certain life insurance received by her on the death of the testator, in payment of debts of the estate, does not lend support to her contention; for her rights under the will were subject to the payment of the debts of the estate, while her interest in the real estate and the exempt personal property to which she would have been entitled under the law, would not have been subject thereto. The effect of the payment of these debts was to relieve her estate and interest in the property therefrom, if she took under the will. If she took under the law, however, the only effect was to reduce the indebtedness that would have to be paid by the remaining property after the exempt personal property and her distributive share in the real estate had been set off to her.
There is now no property of the estate but the land. It is incumbered by a mortgage for $9,600. There is no claim that the bank, practically the only unpaid general creditor of the estate, will not be prejudiced if the appellant is now permitted to reject the will and take her distributive share in the land, to include the homestead, free from debts, and with the right to *Page 82
have the land outside the homestead first exhausted in payment of the mortgage.
We agree with the trial court that the evidence established an election on the part of appellant to take under the will. The facts so showing are much stronger than in Berry v. Donald,168 Iowa 744, cited by appellant. She was fully informed as to the extent of the estate; her own testimony discloses that she was aware of her rights; and with this knowledge she must be said, we think, to have chosen, as between the two, the rights given her by the will. Schubert v. Barnholdt, 177 Iowa 232; Arnold v.Livingston, 157 Iowa 677; In re Estate of Emerson, supra.
The judgment is — Affirmed.
All the justices concur.
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One Latta was the owner of the real estate involved in this suit. A watercourse traverses a portion of the land. The right of way of the appellant passes across said land, and the appellant has constructed a bridge over said watercourse 1. EASEMENTS: upon said premises. This bridge was originally grant: built in 1913, and in 1921 the appellant rebuilt construc- said bridge, making it of a more permanent tion. character. It has remained in the same condition since said reconstruction. The mortgage in question was given by the mortgagor Latta to the appellee on July 3, 1923, and was duly recorded on July 5, 1923. Default having been made in the payment of said mortgage, the appellee instituted foreclosure proceedings, and filed his original petition in the foreclosure action on February 7, 1924. The lis pendens record in the office of the clerk of courts showed the lis pendens from that date. It appears that, after the construction of said bridge, the owner of said premises, Latta, had from time to time instituted suits against the appellant herein for damages to crops caused by the overflow of the water upon said premises, which the owner of the land claimed was caused by the construction of the appellant's said bridge. An action of this kind was pending between the owner of said land and the appellant railroad company on or about the 2d day of September, 1924. At that date, an instrument designated as a "release and conveyance" was entered into between the said Latta and the appellant, whereby it was provided:
"And the said J.H. Latta and Dora M. Latta, his wife, and each of them, hereby sell and convey to the Illinois Central Railroad Company and the Fort Dodge Omaha Railway Company, their successors and assigns, an easement in said land, and the right to run with the land, to construct, repair, improve and maintain the said railroad and any and all embankments, ties, tracks, bridges, culverts, trestles or other improvements on *Page 370
the said right of way adjacent to, upon or across said lands; and the right to divert, obstruct or otherwise affect the flow of water across said right of way, whether brought there by natural or artificial means, and the right to flood said premises hereinafter described in so far as it may be caused by reason of the construction, repair, improvement or maintenance of the said railroad, or of any of the said improvements on said right of way."
The said "release and conveyance" was filed in the office of the county recorder on the 3d day of September, 1924. The decree of foreclosure in the suit which had been pending since the previous February was entered on the 23d day of September, 1924. At the time the said decree was entered against the original mortgagor, the cause was continued as to the appellant herein. An amendment to the appellee's petition in the foreclosure proceeding was filed on the 5th day of September, 1924, and original notice was served on the appellant on said date. A special execution issued on the said decree foreclosing said mortgage, and the premises were sold to the appellee on the 11th day of November, 1924, for the full amount of the judgment on said mortgage, with interest and costs; and, no redemption having been made, sheriff's deed issued to the appellee on or about the 11th day of November, 1925, under which possession was taken at said time. Said cause came on for hearing on the issue between the appellee and the appellant on the said amendment to said petition on the 19th of November, 1925. In said amendment appellee alleges that, since the commencement of his original action for foreclosure of his said mortgage, the said release and conveyance had been executed and placed of record, and alleges that any claim or right which the appellant herein may have by reason of said pretended release and conveyance is junior and inferior to the rights of the appellee, based on said mortgage set forth in his original petition. He further alleges that the release and conveyance is a cloud on his title under said mortgage, and depreciates the value of said lands, to the damage of the appellee. The amendment to the petition prays that the said release and conveyance be declared to be junior and inferior to the appellee's lien under said mortgage, and may be decreed to be void and of no effect, so far as the appellee and his successors are concerned. Upon trial, the court decreed that *Page 371
the said release was an incumbrance on the land, and depreciated the value of appellee's security, and decreed that the appellee's mortgage be foreclosed as against the appellant, and that the lien of said mortgage be re-established as a lien on said lands from the date of recording the same, to wit, July 3, 1923, and that the appellant and all persons claiming by, through, or under it be forever barred and foreclosed of all interest and equity in and to said premises, except the right of redemption, and that said agreement, so far as it affects the right to recover for future damages after the date of the sheriff's deed, be set aside, canceled, and held for naught.
I. The proper construction of the written "release and conveyance" is first to be determined. By its terms it purported to create "an easement in said land," and certain rights which were to run with the land, and it was a release of any and all claims for damages to the land or crops, "whether past, present or future," or whether permanent, continuing, or otherwise, growing out of the construction of the railroad "as now constructed and maintained, or as hereafter at any time may be constructed, repaired, improved, or maintained." We think it cannot be seriously contended but that the instrument, taken as a whole, created a new permanent easement in the land. It not only permitted the existence of the present structure, but also provided that the appellant had thereby "an easement in said land, and the right to run with the land, to construct, repair, improve and maintain the said railroad and any and all embankments, ties, tracks, bridges, culverts, trestles or other improvements on the said right of way adjacent to, upon or across said lands; and the right to divert, obstruct or otherwise affect the flow of water across said right of way, whether brought there by natural or artificial means." This was more than a settlement for damages to crops, "past, present and future." It created rights in the premises which it was expressly provided should run with the land.
Appellant contends that the bridge was a permanent structure, 2. MORTGAGES: and was on the premises when appellee took his priority: mortgage, and hence the mortgage was subject to subsequent appellant's rights under the existing easement. easement in So much must be conceded. When appellee took his land. mortgage, the railroad bridge and embankment were erected *Page 372
upon the premises, the appellant was in possession of the same, and appellee's mortgage was subject to such rights as the appellant then had in the premises. Johnson v. Chicago, B. Q.R.Co., 202 Iowa 1282.
After appellee's mortgage had been executed and recorded, however, the "release and conveyance" was executed. Appellant acquired new and additional rights under said written instrument. These were of two classes: (1) a settlement for all damages to either crops or realty, on the basis of permanent and original damages, and (2) the creation of new and additional rights of easement for construction in the future.
The possession of the appellant at the time appellee took his mortgage was notice of the rights then held by appellant. At said time, appellant was subject to continuing and recurrent damages to land and crops, and it had acquired no rights of added construction. The "release and conveyance" gave appellant new rights in both particulars.
The "release and conveyance" not only settled pending claims for damages to crops, but it also purported to settle all future
damages that might arise to land or crops. In other words, it settled all damages on the basis of permanent and original damages, and expressly precluded the possibility of continuing or recurrent damages.
It is true that the owner of real estate who suffers damages by overflow may elect to treat the damages as permanent and original, make settlement accordingly, and bind subsequent owners of the premises. Thompson v. Illinois Cent. R. Co., 191 Iowa 35. But by so doing the owner, in effect, creates a permanent easement or right to overflow the premises. No such permanent easement or right had been created at the time appellee took his mortgage. The release and conveyance did create such right as a permanent easement. This was junior to appellee's mortgage. The instrument also by its terms provided that the appellant should have the right to "construct * * * any and all embankments, ties, tracks, bridges, culverts, trestles, or other improvements on said right of way adjacent to, upon or across said lands." It cannot well be contended that this did not create new and additional rights by way of a new easement in the premises. Thereunder the appellant is granted much broader and more extensive rights of easement in the premises *Page 373
than existed at the time appellee's mortgage was executed. Such extended, additional, and new rights were junior and inferior to the lien of appellee's mortgage, which was of record when they were acquired.
II. In view of the foregoing, the question arises as to the rights of the respective parties in this action, in view of the proceedings had therein. This is not an action by a mortgagee, either to enjoin a threatened injury to the 3. MORTGAGES: mortgaged premises or for damages for impairment foreclosure: of the mortgage security. Appellee, in effect, sale for simply contends that, after the execution of his amount of mortgage, the appellant, by its agreement with debt: the mortgagor, secured new rights in the effect. premises, which are subject to the lien of appellee's mortgage. Appellee seeks, by the proceedings under the amendment to his petition, to foreclose his mortgage as to such new rights of appellant's.
Appellant contends that, in any event, appellee only held his mortgage as security for his debt, and that the debt has been paid in full by the sheriff's sale for the full amount of the mortgage debt, interest, and costs.
The appellee had an equitable lien under his mortgage, as security for the debt. The legal title to the premises remained in the mortgagor. Section 10053, Code of 1924, is as follows:
"In absence of stipulations to the contrary, the mortgagor of real estate retains the legal title and right of possession thereto."
See, also, Sheakley v. Mechler, 199 Iowa 1390.
Appellant argues that, the debt having been discharged by the sale on execution for the full amount due on the judgment, appellee has no further concern in the mortgage security, and hence has no interest whatever in what the mortgagor did with the premises; that appellee has his money, and that is all he is entitled to. However plausible this argument may seem, it scarcely reaches the case. Appellee, it is true, bid in the premises for the amount due on the mortgage. A stranger might have done the same. At that time, the action was pending against the appellant, to determine its rights in the premises under the foreclosure. That issue in the action did not abate by reason of the sheriff's sale. If a stranger had purchased at the sheriff's sale, with the pending action against the appellant as a junior *Page 374
incumbrance, such purchaser could doubtless have properly been substituted as a party plaintiff in said action, and prosecuted the same to decree, and determined the issue with appellant. That is exactly what the appellee did. He took title under the sheriff's deed, but he still retained the right to prosecute the foreclosure proceeding as against the interest of the appellant in the premises.
The case of Citizens' St. Bank v. Jess, 127 Iowa 450, was an action for foreclosure of a mortgage on real estate. The city of Dubuque was made a party, because it claimed a lien on the property by virtue of certain special assessments levied against it. The petition charged that the said assessments were junior and inferior to the plaintiff's mortgage. The mortgage was foreclosed, and decree entered, the property was sold, under the foreclosure decree, the period of redemption expired, and the plaintiffs in the action took a deed to the premises. The city, as a junior lien holder, was made a party, and the cause continued as to it. The situation was analogous to the case at bar, except that the plaintiffs, who were the purchasers at the foreclosure sale, had transferred the title acquired under the sheriff's deed to third parties by warranty deed. We said:
"In so far as the questions of priority of lien and right to redeem are concerned, no new cause of action was introduced by the supplement to the petition. The special assessments were an apparent lien upon the mortgaged property, and the holder of the mortgage could well make the city a party to his foreclosure proceedings, in order that the validity and priority of its lien might be established. Baker v. Kelley, 11 Minn. 480 (Gil. 370);Bunce v. West, 62 Iowa 80; Stanbrough v. Daniels, 77 Iowa 561;Ayres v. Adair Co., 61 Iowa 728. In any event, it must be conceded that the amendment to the petition shows the invalidity of both the original assessment and the reassessment. In other words, plaintiffs had and have a cause of action against the city for the cancellation of these assessments. Plaintiffs also had a cause of action for the foreclosure of their mortgage, and the decree of foreclosure, with the order of continuance as to the city, did not cut off or affect plaintiffs' original rights as against the city."
In Lindsey v. Delano, 78 Iowa 350, we said:
"It is further urged that no decree could have been lawfully *Page 375
entered against Lindsey, because the land had, long before that, been sold on a foreclosure, and a sheriff's deed executed. It is a sufficient answer to this claim to state that there was no dismissal of the original action. It was continued from term to term for service upon Lindsey and others, and when served, the court had jurisdiction to foreclose his lien."
Appellee was entitled to foreclose his mortgage as a lien on the premises superior to the lien of the appellant, under its "release and conveyance." The action was continued for the very purpose of trying this issue. The sale of the premises for the amount due on the judgment against the mortgagor did not defeat the appellee's right to further prosecute the action, as continued, for the purpose of determining the issue therein.
The decree appealed from not only is equitable, but is sustained by our previous holdings. It must be — Affirmed.
EVANS, C.J., and STEVENS and VERMILION, JJ., concur.
SUPPLEMENTAL OPINION.
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The first alleged errors relied upon by defendant are the refusal of the court to direct a verdict at the close of plaintiff's testimony and at the conclusion of all the testimony. The other errors alleged consist of the court's giving of certain *Page 1210
instructions and its refusal to give defendant's requested instructions.
The case arose out of an oral arrangement between the plaintiff, Morton, a real-estate agent, and Drichel, the defendant, owner of 135.16 acres in Cedar county. The first talk between the parties in relation to a sale of the land was in March 1945. Defendant told plaintiff that he could list the land and the price was $225 per acre. The defendant was told the commission would be two per cent. There was evidence that this was about the substance of the conversation. Later, in another conversation, the price was reduced to $200 per acre. The listing was not exclusive. About April 23d plaintiff learned that one Fay was looking for a farm and went to him the next week, about May 5th, and made arrangements to show this farm and others. They drove to the Drichel farm and looked at its boundaries. Fay said he had seen part of it and the farm was then priced at $200. On May 31st Fay came to see Morton and said he wanted to take another look at the farm. Morton testified he told him he could not take him that day but he telephoned to Drichel and informed him that Fay was coming out. Fay then went to the Drichel farm and talked to the owner. Fay later told Morton that he was not going to buy the farm unless some changes were made, that he was interested in it but the price was too high. Plaintiff also alleges that when he informed Drichel that Fay was coming out defendant stated that he would take care of him (the plaintiff) just the same. The plaintiff also states that a few days after May 31st the defendant came to him and told him that he had a chance to rent and was taking the place off the market and that plaintiff informed defendant that it was all right but that if defendant sold the farm to Fay he would expect a commission.
Fay bought the land and later, on June 13th, a contract of sale was executed, by the terms of which the defendant sold the farm to Fay for $26,950 and agreed to transfer to Fay one hundred twenty-nine burr-oak posts; to pay for and wire the house for electricity and put in certain light fixtures, and to transfer the insurance without cost. Suit for commission was brought and there was trial to a jury. The court overruled the motions to direct a verdict for defendant and the case was submitted to *Page 1211
the jury, who returned a verdict for plaintiff, and judgment was entered accordingly. The question to be determined is: Did the court properly so submit the case to the jury? The various alleged errors assigned by defendant may be considered in their order.
I. He alleges that the agreement for commission was for a sale of the property and that no sale was made. However, a sale was made by the defendant himself, the terms of the sale varying somewhat from those proposed by defendant to plaintiff. Defendant emphasizes, in written and oral argument, that the sale must be made by plaintiff. Whether the sale was made by the owner, through the instrumentality of the agent, was, of course, a question of fact. The duty of any agent would be to produce a purchaser ready, able, and willing to buy the land on the proposed terms, or terms satisfactory to the owner, and whether the agent did so was for the jury to determine. There was evidence that the changes in consideration were not extensive, that they were satisfactory, as evidenced by the formal contract entered into by the purchaser and defendant later, after the purchaser had been sent out to the Drichel farm on May 31st.
[1] The general rule is stated in 12 C.J.S. 196, section 86b:
"Where a broker is the procuring cause of a contract concluded by the principal with a customer produced by the broker, and any special conditions attached to the right to a commission have been fulfilled or waived, the fact that the contract so concluded differs in price or terms from the one which he was authorized to negotiate does not deprive him of his right to a commission."
And this is true where he sells at a lower price than was originally quoted by him to the broker. This rule has been the holding of our decisions. Our most recent decision is Moore v. Griffith, 234 Iowa 1024, 1028, 14 N.W.2d 644, 646. The opinion states that the broker:
"* * * has performed his duty if he introduces the buyer in the sense that he makes known to the seller that his customer is a prospective buyer. After that the seller cannot defeat the broker's right to the commission by closing the deal with the broker's customer and then asserting that the broker was not *Page 1212
entitled to the commission because he did not sell the farm, unless, of course, there has been an abandonment of negotiations with this prospect." Citing Kellogg v. Rhodes, 231 Iowa 1340,1344, 4 N.W.2d 412, 414. Also, the opinion cites, as to the rule, Wareham v. Atkinson, 215 Iowa 1096, 1100, 247 N.W. 534,536; Beamer v. Stuber, 164 Iowa 309, 145 N.W. 936; Johnson Bros. v. Wright, 124 Iowa 61, 99 N.W. 103.
Kellogg v. Rhodes, supra, 231 Iowa 1340, 1344, 4 N.W.2d 412,414, cited above, states:
"The general rule is well settled that if property is listed at a certain price with a broker who is the procuring cause of a sale he is entitled to a commission, even though the sale is consummated by the principal and at a price lower than that quoted by him to the broker." Citing authorities.
The opinion refers to the exception to the above rule where the agreement between broker and principal provides for the payment of a commission only upon obtaining a certain price for the property and the sale is consummated at a lower price. (Italics ours.) The case was decided upon another exception: the withdrawal of the parties to the contract. But the facts in the present case do not bring it within this first exception. Here the contract, oral and informal, was not conditioned upon obtaining the price quoted. The instant case comes within the general rule many times announced by this and other courts. In addition, see, Fisher v. Skidmore Land Co., 189 Iowa 833, 843,179 N.W. 152; Tilden v. Zanias, 228 Iowa 708, 710, 292 N.W. 835,836; Beamer v. Stuber, supra, 164 Iowa 309, 145 N.W. 936; 8 Am.Jur. 1100, 1101, sections 189, 190.
The defendant cites various authorities in support of his views. Santee v. Lutheran Mut. Aid Soc., 226 Iowa 1109,285 N.W. 685, involved the right of one of two brokers to the commission; Johnson Bros. v. Wright, supra, 124 Iowa 61, 99 N.W. 103, holds that the agent had failed to proffer the buyer to the principal; Bente v. Boden, 195 Iowa 669, 192 N.W. 834, holds that the owner may also sell, and that the record failed to show that the broker was the moving cause of the sale. In Sanden Huso v. Ausenhus,185 Iowa 389, 392, 393, 168 N.W. 801, the opinion states that the brokers procured no valid obligation *Page 1213
from the buyer nor did they bring him and the owner together. We have already referred to Kellogg v. Rhodes, supra. These cited cases do not contradict or modify the general rule. We are satisfied that the evidence was sufficient to present a jury question.
[2] II. Defendant, in his motion for a directed verdict, assigned as one ground the alleged withdrawal of the agency. Such revocation is also made the basis of his requested instructions Nos. 3 and 4, and the refusal of the court to sustain the motion and to give the requested instructions are assigned as errors.
We do not think that, as a matter of law, this claimed revocation came at such a time as to deprive the agent of his commission. On May 31st the broker sent the purchaser to the owner. Drichel, in his testimony, said that he thought it was about the middle of May that he withdrew the farm from sale. But the testimony of plaintiff is quite different. He states that he saw Drichel on the evening of the day Fay again went out to look at the farm, but that it was not until a few days later that Drichel informed him that he expected to rent the farm and would take it off the market, and that at that time he (the agent) informed Drichel that if he rented the farm it would be all right but if he sold to Fay he would expect a commission. Later he talked to Drichel, about June 30th.
The written contract for the sale of the farm was made June 13th. Fay testified that Drichel and he had agreed a few days before, he thought two days. At least, the deal was made sometime within the two weeks between May 31st and June 13th. Just when the claimed withdrawal was made was clearly a question for the jury and we need not consider the effect of a withdrawal while apparently the negotiations were proceeding. The question of good faith on the part of the defendant in withdrawing his farm from sale, together with the question of discontinuance and abandonment of the contract and of a recommencement of independent negotiations, were properly presented to the jury by the court in its instructions and determined by them. We find no error as to this phase of defendant's assignment.
III. We have referred to the instructions asked by defendant *Page 1214
and refused by the court. He refers especially to Nos. 3 and 4 relating to withdrawal of agency. The other instructions asked and refused, as well as the two mentioned, are all at least partly based on the theory that to recover there must be a purchaser produced, ready, able, and willing to buy in conformity with the terms of the contract, but no mention is made of a sale on terms satisfactory to the seller. We have discussed this matter in a preceding division. The offered instructions were properly refused.
[3] IV. Defendant excepted to certain instructions. We have examined the instructions and they appear to us to correctly state the case and the law applicable. Much of the objection is on the same theory as in the preceding section. We feel that the objections were without merit. The court properly told the jury that a listing agreement would continue for a reasonable time unless withdrawn but such withdrawal must be in good faith.
Other matters were discussed in argument, such as the claim and computation of plaintiff that the price at which the sale was made was substantially the original price asked, less original commission, but we think it unnecessary to discuss them. We are satisfied that the testimony introduced presented a question for the determination of the jury and that in the trial of the case there was no reversible error.
The cause is therefore affirmed. — Affirmed.
All JUSTICES concur.
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I. Each of the notes in suit was given on November 10, 1922. The larger note was given in renewal of a former note, and the smaller note was given for interest accrued on 1. BILLS AND such former note. In our consideration of the NOTES: case, we shall confine discussion to the $5,000 defenses: note. Our conclusion on that branch of the case unallowable will be decisive of the other. defense.
The note in suit was the second renewal of an original note given by this defendant to the plaintiff on October 28, 1921. In consideration thereof, the plaintiff surrendered a note of like amount which it had held against one Wencks. The defense pleaded is predicated upon certain events which occurred on March 16, 1920. We shall, therefore, take such date as our starting point. On that date a meeting of the board of directors of a certain corporation known as the Consolidated Chemical Products Company was held in the city of Des Moines. The following appears as a part of the minutes of such meeting:
"It was decided by the board to borrow some money for the purpose of paying up the standing current indebtedness and buying materials for operation in the future, whereupon, Mr. Fred J. Boie moved, and Dr. McMahon seconded, the following resolution be adopted:
"Resolved that the officers of the Consolidated Chemical Products Company be and they are hereby authorized to borrow money for the payment of current expenses and for the purpose of buying and having on hand materials for future operation, and that they are hereby authorized to pledge the property of the company, including all property, personal and real, belonging to the Consolidated Chemical Products Company, for the purpose of securing and repaying the loan, and that the same be preferred claim upon the property of the company and be paid before any dividends are paid to stockholders. This resolution was unanimously carried."
The Dr. McMahon named in such minutes is the defendant herein. He had been a director for several years in such company, and so continued, either as director or president, during the entire time covering the transactions involved herein. This corporation had its chemical plant located at Alton, Illinois. The directorate appears to have consisted in the main of physicians *Page 659
and cashiers of small banks. The corporation itself had no line of credit upon which it could draw for the borrowing of money. The purpose of the foregoing resolution was to offer protection to such of the directors as would aid it in borrowing money. The plan orally adopted at that meeting was that each of the directors would loan $5,000 to the corporation and take the corporation's promissory note therefor. In order to carry out this plan, it was necessary for a majority of these directors to borrow the money themselves, and this they proceeded to do. Wencks was the cashier of the State Bank of Klemme. Boie was the cashier of the Hancock Savings Bank, plaintiff herein. This defendant borrowed $5,000 from the State Bank of Klemme, and gave his note therefor. The corporation guaranteed the note. It also executed its promissory note for a like amount to this defendant. Wencks, the cashier of the State Savings Bank of Klemme, borrowed $5,000 from the Hancock Savings Bank. Boie, cashier of the Hancock Savings Bank, borrowed $5,000 from some other bank. Such were the events of this date. These various notes were renewed by their makers from time to time until October 28, 1921. On that date, by mutual arrangement of the directors, this defendant executed his note for $5,000 to the Hancock Savings Bank, in consideration of which such bank surrendered its Wencks note, and in consideration of which also this defendant received back the $5,000 note held against him by the State Bank of Klemme. The defense pleaded is directed against the note executed by this defendant to the State Bank of Klemme on March 16, 1920. The substance of such defense is: (1) That he received no consideration for it; (2) that it was delivered conditionally, and the condition was broken; (3) that he was deceived and defrauded, in that it was agreed that each director would advance to the corporation the sum of $5,000, whereas some of the directors did not do so.
The further averment is that this defendant had not discovered the fraud or the breach now complained of, at the time he executed the note in suit to the Hancock Savings Bank. We think the defense pleaded is wholly beside the mark. No fraud is charged as against the Hancock Savings Bank in obtaining the defendant's note on October 28, 1921. It had no claim *Page 660
upon him prior to that time. It did hold the note of Wencks for a like amount. That note was never impeached as a good and valid obligation. Suppose it be true that the defendant had a good and valid defense against the note held by the State Bank of Klemme. This plaintiff had no interest in such note, and could be in no manner affected by a defense thereto, if one had been interposed. Its acceptance of the McMahon note October 28, 1921, in exchange for the Wencks note, was abundant consideration, regardless of whether McMahon himself received any benefit therefrom. His argument is that he had a good defense against the State Bank of Klemme, and that, therefore, the return of such note to him constituted no consideration. The argument is untenable. The case of the defendant is presented upon the theory that his note to the plaintiff on October 28, 1921, was a mere renewal of the note to the State Bank of Klemme. This is a mistaken premise, and has led the defendant quite astray. The plaintiff-bank was not a purchaser of the defendant's note from the State Bank of Klemme. It never had any interest in such note. No question of holder in due course is involved. The original note executed by the defendant, so far as this plaintiff is concerned, was so executed to the plaintiff as payee. No allegation of fraud is directed to that transaction. It is simply alleged that the defendant had not yet discovered the fraud. And thus was the case submitted to the jury on the theory that, if the defendant proved a good defense to his note as against the State Bank of Klemme, and that he had not discovered such defense when he executed his note to the plaintiff-bank, he was entitled to be discharged.
There is some suggestion in argument that, Boie, the cashier of the Hancock Savings Bank, being a director of the corporation, the bank was thereby charged with knowledge of all the doings of the directors of this corporation. The bank was 2. PRINCIPAL not a member of this directorate. It had no AND AGENT: interest in the corporation. It was doubtless knowledge of sinned against by its own cashier, when he agent: when became involved in it, in so far as it induced not imputed him to involve the finances of the bank in the to distress of the corporation. Boie, as director principal. of this corporation, was not a cashier of the plaintiff-bank. He had no legitimate power to relate the *Page 661
bank to such enterprise. The business confidences acquired by him, as director of such corporation, were for the exclusive benefit of the corporation, and not for the bank, for which he was cashier. Nor will the law charge the bank with knowledge of facts thus acquired by the cashier, where his interest was adverse to that of the bank. However, the question is not a material one herein. What is plain is that the plaintiff-bank had no responsibility for the events of March 16, 1920. It had a right to deal with the defendant on October 28, 1921, precisely the same as with any other customer. The note then executed by the defendant was a valid and binding obligation, and supported by abundant consideration. No defense to it is disclosed in the pleading. For this reason alone, the verdict should have been directed for the plaintiff.
II. In view of the theory upon which the case was tried, we have, nevertheless, considered the merits of the defense on such theory. Suppose it had been true, upon the record, that the note in suit was a renewal note for the first note given by the defendant to the State Bank of Klemme on March 16, 1920; even so, the defenses clearly fail. The plea of want of consideration because the defendant received nothing is not sustained. It is without dispute that the payee-bank advanced the money to the corporation. That was what the payee-bank was requested to do. The defense of conditional delivery is without merit. The evidence relied on is that of the defendant, who testified that he said to Struthers, at the directors' meeting, that, if all the directors did not put up the amount of $5,000, he wanted his note back. Simply that, and nothing more. Struthers was not the payee of the note. The corporation was not. There was no condition attached to the delivery when it was delivered to the payee and the money received thereon.
The plea of fraud is negatived by the defendant's own testimony. While he claims argumentatively that, whereas the agreement contemplated the raising of $45,000 or $50,000, only $35,000 was raised, and this because some of the directors did not respond, he testified, as a witness, that he did not know how much had been raised, nor what the books showed on that subject. The testimony is without dispute that the books showed at all times the true facts; that, whatever those facts were, they *Page 662
were at all times available to the defendant. A part of this time he was president of this corporation. All of this time his son-in-law was secretary of the corporation, and in possession of the books. His attitude toward sources of information is indicated by his following testimony:
"Q. You had an opportunity to know about the business transactions, did you not? A. I could have known. Q. Sure. You do not claim that anybody kept the records away from you, or anything of that kind, do you? A. No, I do not. Q. Why, your own son-in-law kept the records and books, and has for a long time, has he not? A. Yes, he has kept them. Q. You do not claim he is keeping any secrets from you? A. No, he don't try to keep any secrets. Q. You have had all of these records so you could know for yourself just the nature of the business? A. I did not look into them."
The defendant called as a witness in his behalf the secretary of the company, who produced the books. After testifying on direct examination that the books "shows the money that was put up by the board of directors, and they had given their notes," he testified on cross-examination as follows:
"I am a son-in-law of Dr. McMahon. Q. At or before the time of this meeting referred to on March 16, 1920, Mr. A.D. Struthers had put up $14,600, had he not? A. Yes, sir. Q. Then that added to the three, $34,725 put up by Ellis, Carpenter, Boie, McMahon, Ferguson, Turner, and Wencks exceeded — well, over $50,000, did it not? A. Yes, sir. * * * Q. So in all, then, the company received, as shown by Exhibit No. 2, the total sum, after the discount was taken out, of $49,325, did they not, altogether, with what Mr. Struthers had put up before? A. That is what it totals, — yes."
When it is considered that the charge of fraud pleaded by the defendant is predicated on the premise that only $35,000 was raised, the tenuity of the defense is both apparent and transparent. The foregoing shows that no fraud was perpetrated, and this is the adequate explanation of the reason why defendant so long failed to discover it. The case presents the further anomaly that the jury was directed to return a verdict against the guarantor, and yet was permitted to render a verdict in favor of the principal maker. If the defense presented had *Page 663
merit in its allegation of facts, it would yet be controlled by the following authorities: First Nat. Bank v. Bensene, 200 Iowa 1165; Commercial St. Bank v. Beers, 199 Iowa 864; Home Sav. Bankv. Heizer, 200 Iowa 793; National Bank of Decorah v. Robison,199 Iowa 1044; State Sav. Bank v. Deal, 200 Iowa 490.
The plaintiff's motion for a directed verdict should have been sustained against both defendants.
III. The appellee presents a motion to dismiss the appeal because not taken in time. The motion is predicated upon the assumption that the appeal should have been taken within four months, as provided by our present statute. It 3. APPEAL AND was not so taken. The appeal was taken within ERROR: the period of six months. The judgment in this appeal: time case was entered before the new statute went of taking: into effect. Such being the case, as we have statute heretofore held, the appeal was in time. The controlling. motion to dismiss is overruled.
The judgment below is reversed. — Reversed.
De GRAFF, C.J., and ALBERT and MORLING, JJ., concur.
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The major question discussed on this appeal is as to the sufficiency of the evidence to support the verdict. Under the record made, the jury could have found the following facts:
[1] On the 6th of May, 1934, the defendant, Ball, and two others, named Murray and McKay, went by automobile to Omaha, leaving Des Moines about 9:30 o'clock p.m. They returned from Omaha and reached Avoca about 7:30 p.m. on the next day, May 7. They spent about an hour in the town of Avoca, and between 8:30 and 9 o'clock p.m. they started north on highway No. 7. At the north edge of town and on the west side of said highway stands a building of the state highway commission, which is used for a storage and machine shop. It is about 150 feet west of the highway, which it faces, and on the east side of the building are two large doors and a small one. Across the highway, and practically opposite said building, is a residence occupied by Harry Bailey. He was sitting on his porch and heard a noise at the highway garage which attracted his attention, a hammering on the door. He saw two men at the garage and saw the light go out. This light was over the small door. He called Jack Graham, who was foreman of the highway commission, and saw Jack come to the garage that night. He did not see the defendant around the garage that evening, or anywhere on the road.
Graham testifies that he is foreman of the Iowa state highway commission. He responded to Bailey's call, and he and one Ted Nieman went to the garage. The light on the east side, over the door, was broken. He had locked the garage door when he left about 5:30 in the evening. As he drove to the garage the lights of his car were focused on the door. He saw one man come out and run north across the pasture. Just at that time another man came out and the witness grabbed him and he was turned over to the deputy sheriff, Eckhart, who, in the meantime, had appeared upon the scene. The hasp and padlock on the small door were broken and the staple holding the same was pulled out. He examined the interior of the garage and found one of the state highway commission's ten-gallon *Page 597
cans sitting by the gasoline pump, in the neighborhood of about half full, maybe a little more. The tool drawer of the bench was open. The gasoline pump was located inside the garage. South of this highway commission garage, some 10 or 15 feet away, stood a tractor which belonged to the state. About 40 rods north of the garage, and running west, is a dirt road. The witness Graham had passed this garage about 7 or 8 o'clock in the evening, and it was apparently all closed at that time.
The witness Nieman confirms the statements of the witness Graham, and says that they drove north on highway No. 7 to the dirt road, and turned west. They noticed a car flash on its lights and start up. The car started west, turned the corner north, and they followed for about two miles and got close enough to observe that it bore a 77 county license. It was a Model A Ford. They saw the same car the next day in a garage in the town of Avoca. The man captured at the garage and the one running north were George Murray and Oren McKay. This car bearing the 77 county license number was later found alongside the cemetery. In it was found a blue coat that belonged to the defendant Ball, and the car was empty of gas. The man captured at the garage was George Murray.
The witness Schmidt, an agent for the bureau of investigation of Iowa, interviewed the defendant on the 9th of May, in Des Moines, and questioned him as to his whereabouts on the two or three preceding days. He answered that he was in Des Moines, hauling ashes. He denied that he was in Avoca during that time. He instructed the defendant to go to his home and wait until the witness saw him. Later the witness went to the defendant's home and the defendant was not there, but he found him in Marshalltown the following day. The defendant said that he was living with a woman who was not his wife, and he was afraid of getting in trouble on that account. The defendant was then arrested and turned over to the Pottawattamie county authorities. He told the witness he was trying to get some money to go to Missouri and be married. He denied that he was with McKay and Murray when they broke into this garage, and denied being with them at all. He told the witness he went to Marshalltown in the hope of getting some money to marry this woman that he was living with.
Perry, the sheriff of Pottawattamie county, testifies that he *Page 598
had an interview with the defendant after his arrest, and defendant said that when they came to this highway garage in Avoca he let those two men out of the car. They were short ofgasoline. He said he was driving the car at that time. He letthose two men out with the understanding that they would go overto the tractor and get some gasoline. He then drove north on No. 7 and turned and drove west on the dirt road "to wait for thosefellows to get the gasoline." When he saw the car drive into the garage, with the lights on, he knew there was something wrong at the garage. He further said that when he pulled his car onto the dirt road he was to wait there for those two men to come with the gasoline. The witness further said that he (defendant) said to McKay and Murray when they went to get out of the car and go over to this tractor to get some gas to get home on, that he (Ball) would not have anything to do with that, that he had just got out of trouble, out of the penitentiary, and he told them that he would not have anything to do with that. "He told me he was going to stop and wait until they got the gasoline. He told me that after he ran out of gas with this car he was driving he left it by the cemetery, and he started to walk to the town of Walnut and some farmer driving a truck picked him up and took him in to Walnut, and that he there got a train and rode into Des Moines. He told me that when McKay and Murray left the car they were going over to this tractor and get some gas out of that. He found out about McKay and Murray breaking into the building afterwards, about two days later. He told me that when the car drove up (to the garage) with the headlights on, he knew there was something wrong."
In the county attorney's office in Pottawattamie county the defendant signed a written statement taken down by the stenographer. "He told his own story in his own way in answer to our questions." Defendant had been brought over to the county attorney's office by the deputy sheriff so that they could get a statement from him. The defendant always claimed that he had nothing to do with breaking into the building. In the written statement made by the defendant, he states:
"We got to Avoca about 7:30 p.m. We went into a restaurant and got a sandwich apiece. I spent my last money to buy gasoline in Omaha. We did not have much gasoline when we *Page 599
got to Avoca. After we got the sandwiches we started out of town. McKay said, `We got to get some gas.' We saw the highway garage. He said: `We'll try and get some out of a tractor parked there.' I said, `Don't break in any place to get gasoline because I don't want to get in any trouble.' I begged them not to break in and get into trouble. When I found out that they were going to breakin, I drove up the road. I parked on the road north of the shed.I was headed west. I never saw McKay or Murray after they got out of the car. It was not my idea to go back and pick up the boys. If I had seen them I would not have picked them up because I was mad. When I drove by I saw the car drive up and figured the boys were caught. When I saw this I sailed right along. I parked the car across from the cemetery. I left the car because I did not want to have any trouble. I cut across the field walking home. I walked all of the way to Walnut with the exception of about one and one-half miles when a fellow picked me up in a stock truck. He was going to Walnut. I got into Valley Junction a little after six o'clock in the morning on Tuesday, May 8, 1934. I told my wife I had to leave the boys because they stole some gasoline."
The question is whether, under this set of facts, the defendant was rightfully convicted by the jury.
[2] As heretofore noted, the defendant was charged with breaking and entering this building in the nighttime. Great stress is laid upon the confession made by the defendant wherein he denies any knowledge of the breaking and entering, or any knowledge of any intention on the part of his two associates to break and enter the building; and it is insisted that because this written confession was introduced by the state, the state is bound thereby, and, being thus bound, its own evidence shows that the defendant could not have been guilty of breaking and entering said building. While it is true that the state introduced this confession in evidence, the contention of the defendant cannot be sustained that the state is bound by the exculpatory statements contained therein. These statements must be considered in the light of the surrounding facts and circumstances, and other statements made by the defendant in such written statement, and when so considered are, of necessity, a question for the jury. *Page 600
We have had this question before us in the case of State v. Richardson, 240 N.W. 695, loc. cit. 700, where the identical question is raised, and we there said:
"Manifestly the falsity of the exculpatory statements may be shown by circumstantial or direct evidence."
While the exculpatory statements made in said written confession must be considered by the jury in reaching a verdict, it cannot be said that because of the same they are final. The rule governing these matters is quite tersely stated in 16 C.J., p. 738, section 1517, as follows:
"The rule that a confession is to be considered in its entirety does not compel the jury to give the same belief to every part of it. The jury may attach such credit to any part of it as they deem it worthy of, and may reject any portion of it which they do not believe. All of it must be weighed carefully by the jury, and upon all the circumstances surrounding the case they must determine how much of it they will receive and how much they will reject."
We think, therefore, under this rule, which seems to be quite universal, that the exculpatory statements contained in this confession, and the weight to be given to them made a question of fact for the jury.
The state does not contend that the defendant was personally present and actively took part in the breaking and entering of the building. The case was tried on the theory that the defendant Ball was an accessory to the breaking and entering. We have reviewed the evidence with care, and after reading the record several times, we are disposed to think that the guilt or innocence of the defendant, under this situation, was a question of fact for the jury. The defendant, in his statement, says: "I begged them not to break in and get into trouble." While the conversations that took place between these parties are not before the court, the primary object seems to have been to get a supply of gasoline so that they might get back to Des Moines. Certainly something must have been said which would call forth from the defendant the statement above quoted. He further says: "When I found out they were going to break in, I drove up the road." This shows a knowledge or realization on his part that they were going to break into the building. He further *Page 601
says in his statement: "It was not my idea to go back and pick up the boys. If I had seen them I would not have picked them up, because I was mad." This necessarily ties up with his former statement that when he found out they were going to break in he drove up the road; and he expresses himself as having been "mad," presumably because the other boys were going to break into the garage. The sheriff testifies that the defendant told him that he drove north on No. 7, turned and went west on the dirt road, to wait for those fellows to get the gasoline; and that when he saw the car approaching the garage with its lights on, he knew there was something wrong at the garage. The primary thought and understanding that seem to have existed in the minds of the defendant and his associates were to get gasoline to supply their car.
The jury might have found from the evidence in this case that the purpose of all these parties was to get a supply of gasoline for their car, and, as stated by one witness, the defendant admitted that that was the understanding; and, although he was not present at the physical breaking into the building, yet, under the facts and circumstances shown in the record, he was an accessory to the same under the rules governing and defining accessory.
[3] II. Complaint is made of certain instructions because these instructions did not contain the statement that the matters therein referred to were to be proved beyond reasonable doubt. Instruction No. 5 given set out the elements that constitute the crime charged. In instruction No. 6 the jury was told that the burden of proof was upon the state to establish all of the material evidence beyond all reasonable doubt. The instructions against which complaint is lodged simply elaborate the matters set out in instruction No. 5, and it was not necessary, under such circumstances, to include in each of the instructions the proposition as to reasonable doubt, because the instructions are to be read together, and when so read they are not vulnerable to the assault made upon them.
III. Complaint is made that the punishment inflicted is excessive, cruel, and unusual punishment. The record in the case shows, and the jury found, on special interrogatories, that the defendant had been convicted in 1916 in the district court of Marshall county, of the crime of attempting to break and enter, and was sentenced to the State Reformatory at Anamosa *Page 602
for a period not exceeding five years. Also on the 26th of September, 1922, in the same court, he was convicted of the crime of breaking and entering, and was sentenced to the State Penitentiary for a period not exceeding ten years. On September 13, 1922, in the district court of Story county, he was convicted of the crime of grand larceny, and sentenced to the State Penitentiary for a period not exceeding five years. On the 21st day of April, 1931, he was convicted of the crime of larceny of domestic fowls and committed to the State Penitentiary for an indeterminate period not exceeding five years. Hence, prior to this trial, he had been sentenced for four different felonies. Under the habitual criminal act (section 13396, Code 1931), this sentence was authorized.
We have given attention to some other alleged errors, but find nothing in them that would warrant a reversal of the case. — Affirmed.
ANDERSON, POWERS, PARSONS, DONEGAN, and HAMILTON, JJ., concur.
MITCHELL, J., and KINTZINGER, C.J., and RICHARDS, J., dissent.
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I find myself unable to agree with the majority's opinion, and therefore respectfully dissent.
The defendant in this case was charged with the crime of willfully and unlawfully breaking and entering a public building with intent to commit a public offense therein, to wit: larceny. The evidence consisted of the statements made to the sheriff of Pottawattamie county and a state agent, by the defendant, and a written statement made by him, which is referred to in the record as Exhibit 4.
It is conceded that the defendant was not present and took no part in the breaking and entering of the building, and the case as to him was submitted to the jury only on the issue of whether he aided, abetted, or assisted in the commission of breaking and entering said building.
The defendant with two other men had driven from the city of Des Moines to Omaha. They had started back and had reached the town of Avoca, where they stopped for lunch along in the evening. It was dark. They were getting short of gasoline. The defendant was driving the car. However, it was not *Page 603
his car, but belonged to a lady friend of one of the men with him. They drove past a warehouse which belonged to the state highway commission. Along the road a tractor stood. The defendant stopped the car. The sheriff and state agent both testified that in the statements made to them by the defendant he at all times claimed he understood they were going to get the gasoline from the tractor which was out in the road, and that he protested to his two companions against taking gasoline or breaking or entering any building. The defendant is not charged with the crime of larceny. He is charged with breaking and entering. There is not a scintilla of evidence in this record which shows that at the time the two men with the defendant left the car they intended to break into this public building. The undisputed evidence shows that he protested to his companions against the breaking into of any building. He remained in the car some distance from the tractor and the building. He could not see where his companions went, because it was dark. He did not know for two days afterwards that they had broken and entered this building. But, the majority say:
"The defendant, in his statement, says: `I begged them not to break in and get into trouble.' While the conversations that took place between these parties are not before the court, the primary object seems to have been to get a supply of gasoline so that they might get back to Des Moines. Certainly something must have been said which would call forth from the defendant the statement above quoted. He further says: `When I found out they were going to break in, I drove up the road.' This shows a knowledge or realization on his part that they were going to break into the building."
Even conceding that he had knowledge, which I do not think the record shows, that they were going to break into the building, that would not, in my judgment be sufficient to say that this man was guilty of breaking and entering. He continually protested. In his own words, he "begged" these other men not to break and enter. That is the undisputed record.
This court in the case of State v. Bosworth, 170 Iowa 329, on page 345, 152 N.W. 581, 588, said:
"An instruction is erroneous if it authorizes the jury to convict the defendant, because of his presence or mere mental *Page 604
approval or consent, without requiring that he shall have aided in or encouraged the commission of the crime. * * * Mere passive failure to disclose the commission of a crime will not make one an accessory. Davis v. State, 96 Ark. 7, 130 S.W. 547, 549. In Hicks v. United States, 150 U.S. 442, 14 S. Ct. 144, 37 L. Ed. 1137, a case which appellant erroneously cites for the claim that the court should have instructed more specifically on the definition of aider and abettor, it is, however, held that the mere use of words, the effect of which is to encourage another to commit a crime, does not make the user thereof an aider and abettor unless he intended them to have that effect."
In the case at bar we do not have a man using words to encourage his companions to commit the crime. We have an undisputed record that he did everything in his power to prevent them from committing a crime. He protested. He begged. And when he found out what they were going to do, he drove away. And yet, upon such a record this man is convicted of the crime of breaking and entering and is sentenced to the penitentiary for a period of forty years.
This court, in the case of State v. Wolf, 112 Iowa 458, 463, 84 N.W. 536, 538, said:
"It has never been held, so far as we are advised, that mere presence at the scene of crime constitutes aiding and abetting. Indeed, it is elementary that such is not the case. Nor is it sufficient, in addition thereto, that the person present mentally approves what is done. `The party to be charged must,' in the language of Cockburn, C.J., `incite or procure or encourage the act.' Bish. Cr. Law, sections 628-633. The court in this instruction told the jury, in effect, that, if the defendants were near enough to give Icenbice's acts countenance and support, they were guilty as principals. This doctrine would make a principal of every man whose curiosity tempted him to stop and look for a moment at any transaction involving a crime. The instruction cannot be sustained, and was prejudicial to the defendants."
In the case at bar all of the evidence shows that this defendant protested against the commission of the crime. In the case cited the courts said that mere presence and mental approval is not sufficient. "The party to be charged must * * * incite *Page 605
or procure or encourage the act." Where in this record the majority find any evidence to show that the defendant incited, procured, or encouraged the commission of the breaking into and entering of this public building, I am unable to ascertain.
As I read this record, there is not sufficient evidence — in fact, I find no evidence that would sustain a verdict against this defendant that he aided, abetted, or counseled McKay and Murray in breaking into said building. It was the duty of the lower court, upon the motion of the defendant made at the close of the evidence, to direct a verdict, and the lower court having so failed, I would reverse the case.
I am authorized to state that Chief Justice KINTZINGER and Justice RICHARDS join in the dissent.
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The State, through an indictment duly returned by the grand jury, charges that the defendant-appellant, "on or about the first day of December, A.D. 1927, in [Guthrie] county * * * did willfully, knowingly, and feloniously carnally know and abuse Wilma Huitt, a female child then and there under the age of 16 years * * *, the said [appellant] being then and there a male person of the age of more than 25 years."
It is claimed by the State that the appellant, who was a janitor for a school building at Panora, committed the foregoing offense with the prosecutrix, Wilma Huitt, while she was an assistant janitress. Her services consisted of helping the appellant sweep some of the class rooms. Denial of the accusation was made by the appellant, but the jury accepted the view of the State, and returned a verdict accordingly. Thereupon, the trial court sentenced the appellant to a term of 12 years at hard labor in the Fort Madison penitentiary.
Twenty-eight grounds for reversal are stated by the appellant. Many of these complaints relate to the trial court's action in not permitting appellant to ask the prosecutrix certain questions on cross-examination. Other exceptions are taken, and hereinafter will be discussed. An argument also is predicated upon the theory that the evidence was insufficient to sustain a verdict.
I. For the sake of convenience, the last proposition will receive first attention. To prove its case, the 1. RAPE: State called the prosecutrix as a witness. She prosecution testified that the appellant had sexual and intercourse with her in the basement of the punishment: school building at about the time named in the conclusive- indictment. Thereafter, within the regular ness of period of gestation, the prosecutrix gave birth supported to a fully developed child. This childbirth verdict. indicates that some man had sexual intercourse with the prosecutrix. *Page 552
In order to connect the appellant therewith, and show his guilt, corroboration of the prosecutrix was necessary, notwithstanding the childbirth. State v. Reynard, 205 Iowa 220;State v. Davis, 193 Iowa 651; State v. Hunt, 144 Iowa 257.
Hence, the State, in order to meet such burden, produced two witnesses, for the purpose of corroboration. They were: First, Mary Barcus, a girl 14 years of age, who said that she also assisted appellant in sweeping the schoolrooms, and, while so doing, saw him hug and kiss the prosecutrix; and, second, Leonard Bond, a deputy sheriff, who asserted that, about May 10, 1928, the appellant admitted to him, in the presence of the county attorney, that said relationship did in fact take place with the prosecutrix: that is to say, appellant acknowledged at that time that he had sexual intercourse with Wilma Huitt. So, in view of that evidence, there was corroboration. State v. Speck, 202 Iowa 732. Necessarily, then, there was presented a jury question; and, that body having exercised its prerogative in that regard, we cannot interfere with the result.
II. Returning now to appellant's objections because the court limited his cross-examination, it is found his theory seems to be that, if permitted, he could have shown illicit relationship between the prosecutrix and men other than himself. Of course, the crime here charged arises under the statute through sexual intercourse between a male and female when the respective ages are as specified by the legislature.
Sexual intercourse, under such circumstances, constitutes the offense, and if the appellant is guilty thereof, he may be convicted even though other men also had similar relationships with the prosecutrix. Bad moral character, it is 2. CRIMINAL true, when properly proven, may, under the LAW: appeal statute, be shown for the purpose of affecting and error: the credibility of witnesses. See Section 11271 review, of the 1927 Code. But appellant is not scope of: contending for that principle at this juncture. restricted Conceding, for argument's sake, said sexual cross- relationship named in the indictment, examination. appellant's idea is, the jury was unduly prejudiced by the State's testimony that the prosecutrix gave birth to a child. Resultantly, to overcome this prejudice, appellant insists he had a right to show that someone other than himself was the child's father. Yet he maintains the alleged right was denied through curtailment *Page 553
of his attempt to cross-examine the prosecutrix. Assuming, without indicating or deciding, that appellant, under the circumstances, was entitled to make such showing, nevertheless a great and sufficient latitude was allowed him while conducting the cross-examination. At all times the prosecutrix maintained that appellant was the only man who ever became unduly familiar with her. Frankly she admitted that, upon occasions, she had been in the company of certain men and boys inquired about by appellant. On the other hand, she steadfastly maintained that her relationships with those men and boys were entirely proper. No evidence appears in the record from which a contrary conclusion can be reached.
While the trial court was liberal with appellant in this regard, yet it was sought to confine inquiries of this kind to the approximate time of the conception aforesaid. Regardless of the court's attempt to thus confine appellant's investigation, questions were asked by him and answers given by the prosecutrix which covered all periods desired by the defense. Consequently, the appellant was not prejudiced in any way.
III. Complaint is also made by appellant because Mrs. Steele, his wife, was not permitted to answer this interrogatory: "Q. Do you know of any reason on your part why you were not capable of bearing more children than you have?" Because of a proper objection made by the State, the court prevented the witness from answering.
Under some circumstances and conditions, it may be shown in a rape case, by competent evidence, that the defendant was impotent. State v. John, 188 Iowa 494. Appellant argues that he sought to show his impotency through an answer 3. CRIMINAL to the above-quoted question. Parenthetically, LAW: it is noted that Mrs. Steele had already evidence: testified to the fact that she and the opinion appellant, her husband, had three children, of evidence: whom the youngest was 34 years old. The wife, in impotency. October, 1928, was 60 years old, while the appellant had reached the age of 68. Her menopause occurred when she was 45.
Continuing at this place, the witness said:
"I have lived with Mr. Steele as his wife ever since our *Page 554
marriage. We never used any means to prevent conception. I never had any operation."
Now, in view of those parenthetical facts and the purpose and form of the interrogatory, should the witness have been permitted to answer? Manifestly not, for the witness could only state her inexpert conclusion in reference thereto. Furthermore, there is no basis for complaint, because the appellant has not offered to show what he expected to prove by this witness. What would she have said? Concerning that, the record is silent. Obviously, then, for all the reasons suggested, there is no ground for reversal because of this exception.
IV. A further grievance is predicated upon the trial court's refusal to permit appellant's witness Anna Henderson to answer the following question: "Did Mr. Duffield come 4. WITNESSES: to your home last night, after you had gone examination: home, and try to talk with you?" Duffield was questions in the county attorney. Such refusal, just general. mentioned, came in response to an appropriate objection by the State.
Was the court's ruling therefore erroneous in that respect? Clearly not, under this record. Undoubtedly it is proper for the county attorney to communicate with the defendant's witness for legitimate purposes. There is no suggestion that the prosecuting attorney went to the witness's home to wrongfully influence her testimony. Nor does it appear that such official attempted to or did commit any other act unbecoming a lawyer. Here, as before, appellant does not offer to show what the witness's anticipated answer would have been. Misconduct on the part of an official cannot be presumed. Sufficient proof thereof is mandatory, before appellant is entitled to a reversal upon that ground.
V. As a final protest against the action of the district court, it is said by appellant that his sentence is too 5. RAPE: severe. Notation will be made again that the prosecution court fixed 12 years in the state penitentiary and as appellant's penalty. Section 12966 of the punishment: 1927 Code contains the following: sentence: judicial discretion.
"* * * if any person over the age of twenty-five years carnally know and abuse any female under the age of seventeen years, he shall be imprisoned in the penitentiary for life, or any *Page 555
term of years, not less than five, and the court may pronounce sentence for a lesser period than the maximum, the provisions of the indeterminate sentence law to the contrary notwithstanding."
Judicial discretion was vested in the trial court. In exercise thereof, the maximum penalty was not inflicted. Considering the record here presented, we cannot say that the district court abused its discretion.
Wherefore, the judgment of the district court must be, and hereby is, affirmed. — Affirmed.
ALBERT, C.J., and EVANS, FAVILLE, and GRIMM, JJ., concur.
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The will of Susan Eason, who died May 21, 1943, was as follows:
"Alton, Iowa September 10, 1940
To Whom It May Concern
Mrs Susan Eason wife of the Late Stephen Eason Leaves *Page 99
this last Will and Testament being the Mother of the Faweling Children Mary being Desesed whoes Children are Marllys Floyd Oral Stephen and James Jackson these Children are to receive Each one Hundred and Fifty Dollars as thier share as Clarance and Mary have had a considerable amount on nots these nots have not been Redemed. The Fauling Children are to receive one Thousand Dollars Each Oscar Ernest Hilda Emilia Alvin Zella and Fred 7 of them, because George and John have had that amount in time Past Debts betwen the Children shall be paid From thier Respective share before they receive Eny of thier inheritance these Debts must be proven with Nots or Checks From Eny Date My Privet Posesion shall be given to the Highest Bider among my Children. I hope this may be satisfactery to all and Eney one who in Eny way Contests this Will Forfits Eney Right to Eney of my Estate. Oscar shall serve as my Exeuter with out Bond.
[Signed] Mrs. Susan Eason. John J. Schmidt Theresa M. Schmidt."
The will was admitted to probate June 22, 1943. Decedent's property consisted of real estate valued by the executor at $29,800, and bonds, household goods, cash, and bank account $1,483.26. No debts are shown. She left surviving her nine children and five grandchildren, children of a deceased daughter, all referred to in the will. Her husband, Stephen Eason, predeceased her in 1935.
It will be seen the will gave to each of the five grandchildren $150 and to seven of the nine living children (omitting George and John) $1,000 each, making a total of $7,750 in cash bequests. The principal controversy here concerns the disposition to be made of the estate remaining after payment of the cash bequests. The executor (appellant) contends the grandchildren are excluded from participating in the residuary estate. Four of the grandchildren object, claiming it should go to all heirs according to the laws of descent.
An alternative contention is made by the executor. Two notes came into his hands, payable to "S. Eason," aggregating $6,339, and signed by decedent's deceased daughter (mother of *Page 100
the objectors) and by her husband. The executor argues that if it be held appellees are entitled to share in the residuary estate the amount of those notes should be offset against their residuary shares.
The trial court adjudged that as there was no residuary clause the remainder of the net estate after payment of the cash bequests should go as intestate property according to the laws of descent and that the executor had no right of retainer and offset as against the shares of the grandchildren on account of the alleged indebtedness of their mother to the estate.
[1] I. The executor on appeal urges several propositions in support of his principal contention: The intention of the testator governs and "when ascertained, will be enforced by the courts without regard to abstract, arbitrary or technical rules of construction"; all relevant circumstances are to be considered in connection with the language of the will itself; and there is a presumption against intestacy.
Many cases are cited in support of these propositions but we shall not discuss them as the principles are well settled. The difficulty confronting appellant is in their application here. We do not find in this record any circumstances outside the will itself that tend to reveal any intention with regard to the residuary estate. Appellant in argument points out nothing we deem significant in the testatrix' situation or surroundings when the will was executed.
It is clear the instrument was drawn by one (probably testatrix herself) unskilled in the use of language. Appellant says:
"It will be noted that she had no personal property at the time of the execution of the will and that she was considering only the division of her real estate."
We find no significance in the fact itself, even if established. If there was no personal estate or if it was insufficient to pay the cash bequests testatrix must have contemplated that the real estate would have to be sold and the bequests paid in whole or in part from the proceeds. There would in any case be a residuary estate.
She had nine children living and five grandchildren, children *Page 101
of her deceased daughter. In arranging the cash bequests she discriminated by giving each grandchild only $150 (instead of $200) and by giving nothing to her sons, George and John, while bequeathing each of her remaining seven children $1,000.
She gives reasons for this discrimination. In the case of the grandchildren she explains they are to receive the bequests "* * * as thier share as Clarance and Mary [their parents] have had a considerble amount on nots these nots have not been Redemed." And as to George and John, she says they "have had that amount in time Past."
Appellant assumes that all the children share in the residuary estate. He bases his contention as to the grandchildren upon the words "as their share" and the further statement that their parents have had a considerable amount on notes that have not been redeemed.
We cannot read into this language (in the absence of a residuary clause) an intention to disinherit the grandchildren or an intention to dispose of the entire estate by will. The words, "as their share," must be construed to mean "as their share under this will" and not as their share of the undevised property. The testatrix was manifestly not disposing of her entire estate. What is not expressly bequeathed or devised can only pass by inheritance. Testatrix did not give the rest of her estate to her living children. Whatever they receive more than $1,000 each will be received by them as heirs. The argument of appellant would mean that one can by will disinherit his heir without disposing of his property otherwise. We agree with appellees that "a negative exclusion is not equivalent to an affirmative gift."
In Fletcher v. Fletcher, 200 Iowa 135, 137, 204 N.W. 410, 411, this court quoted with approval from 3 Woerner on American Law of Administration, 1384, section 418:
"`The devolution of title to the property of a person dying, cast by the statute of descent and distribution upon his heir or next of kin, makes it indispensable, if a testator wish to disinherit him, not only to express his intention to that effect,but to vest the title, by plain words of gift, or necessaryimplication, in some other person.'" (Italics supplied.) *Page 102
A case analogous to the instant case, but in which the language of the will is stronger than here, is In re Will of Davies,192 Iowa 723, 725, 185 N.W. 578, 579. In it the testator, in his original will, gave his daughter one fifth of the residue of his estate. In a codicil he changed this provision, saying:
"* * * instead of giving to the said Elvira Ann Davies the one fifth of my said estate I give and will to my said daughter * * * the sum of two hundred dollars and no more of my said estate."
(Italics supplied.)
Again, in a subsequent paragraph, he repeated:
"This sum to be in full of the allowance to my said daughter * * * And I ask that said will be construed * * * as giving to * * * her the sum of two hundred dollars out of my estate and nomore." (Italics supplied.)
This language is surely much stronger than the words "as their share" relied on by appellant here, but we held the original one fifth bequeathed her (less the $200 bequest substituted for it) became and passed as intestate property, and assumed without question that she as heir would receive her share of it.
It is true here that the notes of the deceased daughter and her husband aggregate $6,339 exclusive of accumulated interest. The discrimination in cash bequests between the grandchildren and decedent's own children is, of course, entirely inadequate to adjust that amount. But we cannot make that adjustment. Testatrix might well have taken into account the size of the unpaid Jackson notes and have provided for offset of the amount against the grandchildren's share or for her residuary estate to go only to her living children. But she did not do this and we cannot do it for her. We have no way to know her wishes except by taking her will as we find it. She may have thought the notes would still be paid by Clarence Jackson, who was still living. She may have been unwilling to penalize her grandchildren further for the sins or misfortunes of their parents. She may even have had the mistaken notion that as a matter of law the children were liable for their parents' debt *Page 103
and that the right of retainer and offset would exist in favor of the estate.
In any case, we cannot write into the will something omitted by testatrix. We cannot reform under pretense of interpreting. In Starr v. Newman, 225 Iowa 901, 904, 281 N.W. 830, 832, we said:
"The intention of the testator must prevail * * * but such intention must be ascertained from the terms of the will, and from nothing else." (Citing cases.)
And in In re Will of Hagan, 234 Iowa 1001, 1007,14 N.W.2d 638, 641, 152 A.L.R. 1296:
"It is a familiar statement that in ascertaining the testator's intent the question is, what is meant by what the testator said, rather than what he intended to say."
We are asked here to interpret the language of the will so as to disinherit the grandchildren. This result cannot be reached by mere conjecture but only by express words in the will or by necessary implication arising from those used. 69 C.J. 97 et seq., section 1149; Harvey v. Clayton, 206 Iowa 187, 191-193, 220 N.W. 25, 27; Anderson v. Wilson, 155 Iowa 415, 136 N.W. 134.
In Harvey v. Clayton, supra, we quoted with italicized approval from 28 R.C.L. 227 et seq:
"Furthermore, it should be observed that the rule that a testator is presumed to have intended not to die intestate as to any part of his estate is not of greater force than the rule that an heir is not to be disinherited except by express words or necessary implication."
Practically the same language is found in Anderson v. Wilson, supra:
"Finally, if we are to indulge in any presumption at all in interpreting the will, it should be done with due regard to that well-established rule that an heir at law shall not be disinherited on the strength of a doubtful construction of a will. The authorities go even farther than this, and say that an heir is not to be disinherited, except by express declaration or devise, *Page 104
or by necessary implication from the testator's language." (155 Iowa at page 429, 136 N.W. at page 139, citing Jarman on Wills and other authorities.)
Testatrix' language in the instant case does not compel the construction contended for by appellant. The trial court correctly so held.
[2] II. Appellant's alternative contention that the debt of their parents to the estate should be set off against the grandchildren's shares as heirs and legatees finds no support in any cited authority and is not maintainable in principle. These grandchildren are not indebted to the estate. They share in the residuary estate as heirs of testatrix and not as heirs of their mother, who predeceased testatrix. Our decision in the comparatively recent case of In re Estate of Fairchild, 231 Iowa 1070,3 N.W.2d 157, furnishes a complete answer to appellant's argument at this point. We need not repeat what is there said or again cite the authorities therein referred to.
Appellant, citing 69 C.J. 1033, Wills, section 2234, urges that the language of the will, referring to the notes of "Clarance and Mary" not having been "Redemed," indicates an intention that the amount of the notes should be treated as advancements and deducted from the grandchildren's inheritance. The language cannot be so construed. Nor is appellant's apparent reliance upon In re Estate of Mikkelsen, 202 Iowa 842, 211 N.W. 254, warranted by the decision in that case. We were there considering a devise to a devisee who predeceased the testator. The so-called anti-lapse statute (section 633.16, Code, 1946, section 11861, Code, 1924) was held not to prevent offset of the devisee's indebtedness to the estate against the devise passing (under the statute) to the devisee's heirs. Of course, the case is not in point here as appellees take direct from the decedent as legatees and heirs and not through their mother, who was not a devisee or legatee under the will and who never became an heir of testatrix.
What we have said has assumed that the notes payable to "S. Eason" were in fact the property of Susan Eason at her death. There is some suggestion in argument that they may have been given to Stephen Eason, testatrix' husband who predeceased *Page 105
her. We need not determine that question. Nor need we consider appellees' argument that, being a proceeding in probate, the case is not triable here de novo. The decision of the trial court is right and is affirmed. — Affirmed.
All JUSTICES concur.
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Case: 15-30876 Document: 00513684786 Page: 1 Date Filed: 09/20/2016
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 15-30876
United States Court of Appeals
Fifth Circuit
FILED
UNITED STATES OF AMERICA, September 20, 2016
Lyle W. Cayce
Plaintiff-Appellee Clerk
v.
LAWRENCE HUMPHREY,
Defendant-Appellant
Appeal from the United States District Court
for the Western District of Louisiana
USDC No. 2:14-CV-1071
USDC No. 2:07-CR-20101-1
Before DAVIS, CLEMENT, and HIGGINSON, Circuit Judges.
PER CURIAM: *
Lawrence Humphrey, federal prisoner # 13885-035, appeals the district
court’s denial of his motion to appeal in forma pauperis (IFP) from the denial
of his motion under 28 U.S.C. § 2255 challenging his conviction and sentence
for various firearms offenses. He moves for leave to proceed IFP in this appeal.
We must first examine whether we have jurisdiction to consider this
appeal. See Mosley v. Cozby, 813 F.2d 659, 660 (5th Cir. 1987). Article III of
* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
Case: 15-30876 Document: 00513684786 Page: 2 Date Filed: 09/20/2016
No. 15-30876
the Constitution authorizes federal courts to “adjudicate only actual, ongoing
cases or controversies.” Lewis v. Continental Bank Corp., 494 U.S. 472, 477
(1990). The case-or-controversy requirement applies to all stages of litigation
from the trial level through the appellate process. Spencer v. Kemna, 523 U.S.
1, 7 (1998). An appeal is moot where the court can no longer grant any effectual
relief to the prevailing party. Motient Corp. v. Dondero, 529 F.3d 532, 537 (5th
Cir. 2008). Because mootness implicates Article III’s case-or-controversy
requirement, it is an issue of jurisdiction. Bailey v. Southerland, 821 F.2d 277,
278 (5th Cir. 1987).
We have already disposed of Humphrey’s appeal from the denial of
§ 2255 relief. Accordingly, this appeal and Humphrey’s motion before this
court to proceed IFP are moot. See Motient Corp., 529 F.3d at 537; Bailey, 821
F.2d at 278.
MOTION TO PROCEED IFP DENIED AS MOOT; APPEAL
DISMISSED AS MOOT.
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In case No. 15152 in the Hamilton county district court, judgment was rendered in favor of the plaintiff and against the defendant Edwin J. Kallem, aided by an attachment against real estate, which was continued in force. Thereafter plaintiff brought action No. 15280 to set aside a conveyance made by the said Edwin J. Kallem and his brother Alvin B. Kallem to Clara Kallem Eittreim and Anna Kallem Carlson. By agreement the cases were consolidated. The order of consolidation was as follows: *Page 883
"It is agreed by the parties and ordered by the Court that this cause is consolidated for trial with issues raised by the Petition of Intervention of William and Raymond A. Thompson, in Case No. 15152, and that such consolidated trial be had in equity on Sept. 19, 1938, at 9:00 A.M."
Decree was rendered in favor of the defendants, dismissing the petition of intervention of William Thompson and Raymond A. Thompson, who claimed to have bought the land; finding that Edwin J. Kallem had only a one-seventh interest in the real estate, subject to later adjudication; and other findings and orders hereinafter referred to.
The father of the defendants died in 1912, intestate, survived by his widow Mary O. Kallem, and children — Randolph Kallem, Alvin B. Kallem, Edwin J. Kallem, Theodore N. Kallem, Anna Kallem (now Anna Carlson), Ida Kallem (now Ida Sanford), and Clara Kallem (now Clara Eittreim). At the time of his death he was the owner of two tracts of land, one of 174 or 175 acres, and another tract of land containing about 115 acres. One son, Randolph, had married and moved away, but the rest of the family remained on the farm until 1917, when the mother and daughter Clara moved to town. Clara and Anna have since continued to care for and support the mother. Alvin, Edwin, and Theodore continued to farm the land until 1919, and Edwin and Alvin farmed the home place in 1919 and 1920. In 1920 the lands were sold at public auction. The 175-acre tract was purchased by Edwin and Alvin at a very high price, and the 115-acre tract was bid in by Anna and Theodore, who immediately sold the land to the Ringstads. No cash was paid for the land purchased by Edwin and Alvin, nor was any deed made at the time of sale. These two sons had previously bought a farm, called the Bourne farm, which was incumbered by a mortgage.
Foreclosure of the Bourne tract was started late in 1921. Fearing a deficiency judgment, an arrangement was made by which a deed was given to Alvin and Edwin for the home place (the 175-acre tract), and they gave a note and mortgage to their mother, no part of which was ever paid, and admittedly to make the indebtedness so large that it would discourage the Bournes from attempting to enforce any deficiency judgment. This mortgage was later released. However, the land was deeded back in *Page 884
1923 to the Bournes. The two sons continued to farm the land most of the time until the year 1929, and later, the plaintiff knowing that they were paying rent during that period. The fact is, however, that very little rent was paid by them, although a dividend from the estate was held back to offset part of the rent. Alvin died in 1933. For some time previous to October 1931, there was some complaint about the other heirs getting so little from the rent of the farm, and it was suggested that Edwin and Alvin should deed the land to the two sisters. This was done on October 9, 1931. At the time there were taxes and interest unpaid; there was a mortgage on 120 acres of $9,500 and on the fractional 55 acres of $3,000. The deed was made to Anna Carlson and Clara Eittreim, and a contract was given back providing that when the land was sold the debts owed by Randolph, Edwin, and Alvin should be deducted from their respective shares, and if they had any balance due after their debts were paid they should receive it. It appears that Lakin, the plaintiff, knew about the deed and agreement shortly after they were made. The 115-acre tract was deeded back by the purchaser to Mary O. Kallem, but it was heavily incumbered.
The note on which the plaintiff secured judgment was given in 1920, signed by both Edwin and Alvin and their mother, Mary O. Kallem, but was afterwards renewed.
Judgment was rendered in the first case on May 25, 1938. The petition alleges fraud, and the attachment was directed to remain unimpaired so that the plaintiff might bring suit to set aside the transfer. An answer was filed in that proceeding, denying fraud, alleging the execution of the deed in 1931, laches of the plaintiff, and the bar of the statute of limitations. There was also filed the petition of intervention of William and Raymond A. Thompson, claiming ownership by contract from Clara and Anna, and also alleging laches and the bar of the statute. The Thompsons paid $2,000 by check at the time of the contract for the sale on January 14, 1938, and deed was afterwards executed. Following judgment in the first case (No. 15152) the plaintiff's petition was filed in No. 15280, asking that the deed to the defendants Clara and Anna be set aside and that the real estate be subjected to plaintiff's judgment; alleging no consideration; alleging that Edwin J. Kallem is the real owner *Page 885
of the real estate, and conspiracy in making such transfer, for the purpose of hindering, delaying, and defrauding Edwin's creditors; and alleging the insolvency of Edwin and a conspiracy to defraud. By answer this was denied by the defendants, who set up the delivery of the warranty deed; claimed the bar of the statute, lack of diligence on the part of the plaintiff, and the sale of the land to the Thompsons. The Thompsons were not made parties to the second suit.
The contract executed at the same time as the deed is in substance as follows: It first sets out that E.J. and A.B. Kallem are the owners of the land in controversy, subject to mortgages of $9,500 and $3,000; that the interest is delinquent and taxes are unpaid; the increase of the mortgage indebtedness on the property and the receipt by the three brothers of the amount of the increase. It refers to the deed that had been made, and provides that if the land is sold there shall be deducted any advancements that have been made by Anna and Clara. It provides for the disposition of the rents and for the final settlement and the deduction of indebtedness of the seven members of the family, as well as the payment of advances made by them, and states that each of the children shall receive a one-seventh interest in the balance, if there is any balance, subject to deduction from such share of the amount he or she may owe the estate because of advancements received. This contract was signed by Anna Carlson and Clara Eittreim.
The decree heretofore referred to, dated September 22, 1938, recites the recovery of judgment; states that the deed dated October 9, 1931, conveyed merely the legal title; that such conveyance, together with the written contract executed contemporaneously established and placed the premises in trust in the name of the grantees for the benefit of the seven heirs, naming them, each having a one-seventh interest subject to any indebtedness owing or advances received, if any, by any of them. The decree does not determine the amounts due or owing by Edwin and finds that it is not necessary to set aside the deed to protect the rights of the plaintiff; holds that the defense of laches does not apply since the court finds that the plaintiff went in time to the attorney for the defendants to commence his suit, but was dissuaded; that the Thompsons had sufficient notice in time to protect their rights in the $2,000 down payment, and dismisses *Page 886
as to them; continues the cause for settlement of the accounts among the heirs, and authorizes the sale to the Thompsons to go through, if with the consent of the plaintiff, and proceeds to be held in lieu of the land.
From this decree the plaintiff appeals.
The plaintiff's principal claim is that the conveyance to the two sisters was voluntary and without consideration and fraudulent.
Edwin, called as a witness for the plaintiff and who appears to have been a friendly witness, stated in his testimony that the reason for entering into the arrangement on October 9, 1931, was that he was indebted to the Ellsworth Bank in about the sum of $2,900, and was afraid of a judgment; that there was no other object in making these papers than to protect the land against judgments against Edwin and Alvin. So far as Edwin's indebtedness to the bank was concerned, it appears that it was afterwards settled, about or after the time of Alvin's death in 1933. The reason assigned by Clara, however, in which she was supported by the testimony of Theodore, was that the sons were unable to carry the load of taxes and indebtedness and wanted the two grantees to take the land. It is a fact that the deed and the so-called contract were made at the same time, but the contract was never placed of record, and, according to Clara, was intended to be an arrangement among the heirs themselves.
Clara was the moving spirit in making the arrangement. One of the grounds urged as a reason for setting the deed aside was that the conveyance was made in fraud of creditors, but Clara in her testimony insists that Edwin's indebtedness to the bank was not known to her, and we are inclined to believe that this is true. She did not know of the Lakin indebtedness, but the deed was made for the protection of the daughters' claims for indebtedness due them from the two sons, and, if in good faith and in the absence of fraud or intent to defraud, they had a right so to protect themselves. So far as the plaintiff, Lakin, is concerned, the arrangement was known to him, and that immediately after the transaction. This was stated by Edwin in his testimony and is not denied. Such could hardly be called a secret trust, since the only party who could claim any injury to himself had knowledge, and knew the circumstances of the transfer to the sons in 1922 and the conditions under which they *Page 887
held the land. This deed in 1931 was merely a reconveyance which transferred the property to the parties entitled thereto. As to the heirs, the transaction was fair and just, and, as one of the brothers states in his testimony, the boys had had the advantage theretofore and there seemed to be a general agreement that the rights of the various parties ought to be adjusted. The mother was not a party to the transaction. She had previously taken the 115-acre tract as her share of the estate by the general consent of all the parties interested. This had been the understanding ever since 1922, when the Ringstads deeded back the land. Since that time she had made no claim of any interest in the 174 acres. The conveyance to the daughters was approved by Edwin, who felt that Anna was entitled to compensation for taking care of her mother, and testified that he had so stated.
Under the previous arrangement also it seems that, while the legal title was vested in Edwin and Alvin, they recognized, so far as the other heirs were concerned, that such heirs had an interest. They occupied the land as tenants and acknowledged their obligation to pay rents. Alvin and Edwin thus continued to farm, more in the capacity of tenants than owners. Some cash rent was paid, and grain rent, although not all which they had contracted to pay, and all this notwithstanding the deed by which they held the record title and the mortgage which had been given. And of this manner of conducting the farm and the payments of rent the plaintiff knew, for he himself had purchased grain from them and had been informed that the boys were paying rent on the land to the other heirs. When the purchase of grain was made by him the check was given to the Kallem estate. So far as the parties themselves are concerned with the understanding and arrangement under which Edwin and Alvin held the land, there was no denial of the right of the other five heirs to a share in the 174 acres.
It is insisted by the plaintiff that the transaction of October 9, 1931, was a secret trust, but the evidence of plaintiff's witness, Edwin, is to the effect that plaintiff knew about it and it was all right with him. In answer to the question:
"You didn't want him to be in the dark about what you were doing?" the answer was: "No, sir."
"Q. Did he make any objection to it? A. He did not. *Page 888
"Q. Did you tell him before you had made the deed or just afterwards? A. Just afterwards."
Later, on cross-examination, he said:
"I imagine I told him."
However, the witness was very clear and definite, not only that he had informed Lakin, but that Lakin knew of it and made no objection. It appears from the evidence that Lakin not only had full knowledge of the deed but of the contract.
Considering all the facts and circumstances connected with the transaction, we believe the findings and decree of the district court were right. We find that, not only was there no fraudulent intent on the part of the grantees in the deed but that the whole transaction was not fraudulent as against creditors. If, as suggested by plaintiff, the burden was on the defendants, we think they have sustained that burden. Other matters discussed by counsel we do not find necessary to consider.
A motion to dismiss the appeal was filed by defendants. We are disposed to consider the case on the facts, and in view of our holding we find no necessity of a ruling on the motion.
The decree of the district court is affirmed. — Affirmed.
HAMILTON, C.J., and BLISS, MILLER, OLIVER, MITCHELL, SAGER, and STIGER, JJ., concur.
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On the afternoon of March 3, 1947, plaintiff, Mrs. Delacy, age fifty-eight, suffered a broken hip when she fell on an accumulation of ice on a sidewalk at the southeast corner of the intersection of Ninth Street Northwest and Washington Avenue in Mason City. Trial resulted in verdict and judgment for plaintiff for $1026.50 from which defendant has appealed.
Plaintiff was walking west on the sidewalk along the south side of Ninth Street and intended to cross Washington Avenue which runs north and south. Along the east curb of Washington there was a ridge of ice "anyway a foot high" formed from snow which the city had cleared from the roadway during the winter of 1946-47. This snow had been pushed against the curb and onto the sidewalk in question that extends east from Washington.
Photographs taken soon after the accident indicate the ridge of ice was probably three to four feet wide, about half of which was on the sidewalk and the rest in the roadway along the curb. In other words the east curb on Washington was beneath the approximate center of the accumulation of ice.
[1] I. Upon this appeal the city first contends plaintiff has failed to show that any dangerous condition at the place of the accident was the proximate cause thereof. Defendant does not argue it was not negligent in permitting the accumulation of ice at the place plaintiff fell but says there is no evidence such condition caused her to fall. We think the issue of proximate cause was properly for the jury.
Plaintiff slipped and fell in attempting to walk across this *Page 953
rough and uneven ridge of ice. She testified concerning the time she came to the accumulation of ice:
"I stepped up with my right foot and put the left over to get a good foothold, that is when I slipped and fell. * * * I put the left foot over to get a good hold but I didn't seem to find it; this was quite high; it made me step up quite high to get over that bunch of ice. Q. And was it at that point that you slipped? A. Yes, I had not gotten clear over; I just got the left foot over."
On cross-examination plaintiff said:
"Q. Which foot was it that gave way under you? A. The left foot and I seemed to be pushed some way; when they picked me up I was sort of facing north and kind of whirled around. Q. You think your left foot twisted? A. Yes. * * * I was on the sidewalk * * * right here in the middle."
[2] It is true, as defendant argues, plaintiff did not testify in so many words her fall was caused by the rough and uneven mound of ice. We need not consider whether such testimony would have been proper. It was not necessary. It is fairly to be inferred from the evidence the accumulation of ice was the proximate cause of plaintiff's fall. This is all that was required.
These decisions lend support to our conclusion: Ahern v. City of Des Moines, 234 Iowa 113, 119, 12 N.W.2d 296, 299; Brown v. Incorporated Town of Chillicothe, 122 Iowa 640, 642, 98 N.W. 502; Hodges v. City of Waterloo, 109 Iowa 444, 448, 80 N.W. 523. Of course the question of proximate cause is ordinarily for the jury. Lindquist v. Des Moines Union Ry. Co., 239 Iowa 356, 362,30 N.W.2d 120, 123, and citations; 7 McQuillin, Municipal Corporations, Second Ed., section 3101; 38 Am. Jur., Negligence, section 351; 43 C.J., Municipal Corporations, section 2051.
Decisions cited by defendant do not conflict with our holding here. In Tobin v. City of Waterloo, 131 Iowa 75, 107 N.W. 1031, plaintiff did not know whether she fell at a place where the ice was rough and uneven or at a point where no negligent condition existed and the place or cause of her fall was not to be inferred from other testimony. In Norman v. City of Sioux City, 197 Iowa 1310, 197 N.W. 18, and Geringer v. Town of *Page 954
Marcus, 203 Iowa 41, 212 N.W. 365, we held there was insufficient evidence of defendant's negligence.
[3, 4] II. Defendant's remaining complaints are against the trial court's exclusion of some of its evidence. The assistant city engineer who directed the street department testified he knew of no other way of cleaning the streets than by pushing the snow off — "You have to push it from the road to open it for traffic." The witness was then asked by defendant's counsel, "Q. And that is the generally accepted practice among the cities and towns in this locality as far as you know?" The answer, "Everyone that I know of," was stricken upon plaintiff's motion as incompetent, irrelevant and immaterial. While perhaps the court might have permitted the answer to stand we think the ruling was not reversible error.
It is true as defendant argues that subject to certain qualifications evidence of custom in the performance of similar acts, while not a conclusive test, is generally admissible upon the issues of negligence and contributory negligence. Conformity with custom is ordinarily some proof of due care and nonconformity some evidence of negligence. Langner v. Caviness,238 Iowa 774, 778, 28 N.W.2d 421, 423, 172 A.L.R. 1135, 1137, and citations; II Wigmore on Evidence, Third Ed., section 461, *page 489.
None of our previous decisions on evidence of custom goes to the precise point here involved. And 43 C.J., Municipal Corporations, section 2021, page 1257, states, "Evidence of like * * * methods of * * * caring for streets or sidewalks in other municipalities is not generally admissible to prove or disprove negligence in a particular case."
Without further considering the admissibility of the offered testimony generally in this class of cases we hold that sufficient justification for the ruling complained of in this particular case is found in the recognized principle that some exclusions even of relevant and competent testimony do not constitute reversible error. The judge may in his discretion exclude evidence if he finds its probative value is outweighed by the risk that its admission will create substantial danger of confusing the issues or misleading the jury. Rule 303, American Law Institute Model Code of Evidence. Much to the same effect *Page 955
are II Wigmore on Evidence, Third Ed., section 461, page 490; 2 Jones Commentaries on Evidence, Second Ed., section 591, page 1093; 31 C.J.S., Evidence, sections 159, 180.
The negligence charged against the city and submitted to the jury was not so much the manner in which the snow was first placed upon the sidewalk but that it was permitted to remain there throughout the winter after it had become rough, rounded and uneven and thus dangerous and unsafe. The practice of other municipalities in removing snow from their roadways, without any showing it was customary to allow it to remain upon adjacent sidewalks for an indefinite time, had at best only a remote bearing, in point of value, on the issue of negligence, and evidence thereof might well have confused the jury as to that issue.
[5] III. Defendant's remaining complaint is against the exclusion of its offer of testimony by the witness Riley that the city has 107 miles of streets, 125 miles of sidewalks, 1100 intersections, 9000 crosswalks, 30 employees who worked at snow removal, and in general what the city did after a snowfall. No authority is cited to sustain this complaint.
Rejection of the offered testimony finds support in Lindsay v. City of Des Moines, 68 Iowa 368, 27 N.W. 283; Rice v. City of Des Moines, 40 Iowa 638, 645, 646; Stafford v. City of Oskaloosa,64 Iowa 251, 253, 20 N.W. 174; Finnane v. City of Perry, 164 Iowa 171, 177, 178, 145 N.W. 494; Thompson v. City of Sigourney,212 Iowa 1348, 1351, 1352, 237 N.W. 366; 7 McQuillin, Municipal Corporations, Second Ed., section 3067.
Defendant concedes some of our decisions support the exclusion of the offered testimony but says they are erroneous. It is true that similar evidence is sometimes received in this class of cases principally on the question whether a municipality has removed snow from its sidewalks within a reasonable time. Such issue is not here involved, except perhaps remotely. The present case does not call for a re-examination of our precedents and we are not disposed to recede from them here. — Affirmed.
HAYS, C.J., and BLISS, OLIVER, HALE, WENNERSTRUM, SMITH, and MULRONEY, JJ., concur.
MANTZ, J., not sitting. *Page 956
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Plaintiff's petition alleges that he was appointed *Page 23
by defendants to the office of state superintendent of printing on January 7, 1939, and removed from that position as of January 15, 1941; that plaintiff is an honorably discharged soldier of the war with Germany and therefore entitled to the benefits of the Soldiers Preference Law (chapter 60, Code, 1939); that his removal was wrongful because the provisions of the law with regard to hearing upon stated charges were not complied with. A writ of certiorari was issued, which defendant printing board moved to quash on the ground that the position held by plaintiff came within the exceptions to the soldiers Preference Law provided for by Code section 1165. The trial court sustained the motion and plaintiff has appealed.
[1] This appeal presents the one question whether the position of state superintendent of printing held by appellant falls within any of the exceptions to the Soldiers Preference Law stated in Code section 1165, reading as follows:
"Exceptions. Nothing in this chapter shall be construed to apply to the position of private secretary or deputy of any official or department, or to any person holding a strictly confidential relation to the appointing officer."
If appellant's position was that of private secretary or deputy of the printing board or if appellant held a strictly confidential relation to the board, under the plain mandate of the statute, he is not entitled to the benefits of the Soldiers Preference Law and the ruling of the trial court must be affirmed. We are agreed that the trial court was right in holding that appellant's position falls within the confidential relation exception stated in section 1165.
We will not undertake any comprehensive definition, applicable in all cases, of the terms "private secretary," "deputy," or "person holding a strictly confidential relation to the appointing officer." A similar question to that now before us was before the court in Allen v. Wegman, 218 Iowa 801, 254 N.W. 74; Hannam v. Commerce Commission, 228 Iowa 586, 292 N.W. 820; and Bowman v. Overturff, 229 Iowa 329, 294 N.W. 568. All three of these cases, especially Allen v. Wegman, discuss the meaning of the confidential relation exception to the preference law. The Allen case quotes with approval from Scott v. Brown, *Page 24 90 Ind. App. 367, 157 N.E. 64, (page 810 of 218 Iowa, page 79 of 254 N.W.) as follows:
"`The term "confidential relation" is a very broad one and is not at all confined to any specific association of the parties, but applies generally to all persons who are associated by any relation of trust and confidence.'" This statement is frequently found in texts (see 15 C.J.S., page 822) and in decisions in cases of this kind.
Also in the Allen case, referring to People v. Palmer, 152 N.Y. 217, 46 N.E. 328, a leading case on this subject, (page 810 of218 Iowa, page 79 of 254 N.W.) we say:
"The court in that case further said that, where the duties of the appointing officer were of such a character that it is impossible for him to personally discharge them, and of necessity he was compelled to intrust the performance of them largely to others, a confidential relation arose between the officer and the others to whom a portion of his duties was necessarily delegated."
Where duties are not merely clerical and require skill, judgment, trust and confidence, the courts are inclined to regard the appointee to whom such duties are delegated as holding a strictly confidential relation to the appointing officer or board.
The state printing board was created by the legislature. (Chapter 14 of the Code.) Its duties are defined by statute, many of them being stated in section 183. The board consists of the secretary of state, auditor of state, attorney general, and two appointive members each of whom must have had at least five years experience in the printing trade. (Sections 178 and 179.) The law does not contemplate that the members devote their full time to the business of the board. The three state officials have other important functions to perform. The two appointive members are paid only for the time actually engaged in the performance of their duties. (Code section 182.) Of necessity, what the board members themselves can personally do is limited. The statute expressly provides that the board shall prescribe rules for the conduct of its business.
The printing board is authorized to appoint the superintendent who "shall serve during the pleasure of the board." (Code *Page 25
section 213.) Section 215 outlines at least many of the duties of the superintendent. He is required to devote his full time to the duties of the position. With regard to the enforcement of contracts for state printing the statute provides that the superintendent acts under the direction of the board. Likewise, in the preparation of specifications and advertisements for printing the superintendent acts under the directions of the board. He is the "ex officio secretary and general executive officer" of the board. Finally, the superintendent is required to "perform such other duties as are necessary, or incident to his position, or which may be ordered by the printing board, or required by law." (Code section 215.) (Italics supplied.)
[2] The principal point urged upon us by appellant is that the duties of both the board and the superintendent have been prescribed by the legislature; that the delegation of power to the superintendent is not from the board, but from the legislature; and that therefore there is no strictly confidential relation between the board and the superintendent. As we have above observed, the statutes do make provision for the duties of the board and at least for many of the duties of the superintendent. It does not necessarily follow, however, that the relation between the board and the superintendent is not strictly confidential. The statute expressly provides that the superintendent act under the direction of the board in at least the two important matters of enforcing contracts for state priming and in the preparation of specifications and advertisements therefor. Furthermore, there is imposed upon the superintendent by the legislative mandate such other duties as may be ordered by the board. Under this provision, the board was authorized to, and no doubt did, impose numerous duties upon the superintendent. We think it is plain therefore that while the statutes undertake to provide for the duties of both the board and the superintendent, the legislature contemplated that the board direct the superintendent in the performance of at least many of his duties and that the superintendent is required to act pursuant to such directions. The statutes contemplate a delegation of authority from the board to the superintendent, and the duties imposed upon the superintendent involve skill, judgment, trust and confidence. They are not merely clerical in nature. The statutes fairly imply a relation *Page 26
of strict confidence on the part of the superintendent toward the board that appoints him and at whose pleasure he serves.
[3] Appellees contend that appellant is both a private secretary and a deputy of the board. As above observed, section 215 provides that the superintendent shall be "ex officio secretary and general executive officer" of the board. Also, the superintendent is required to "keep a detailed record of all meetings and proceedings of the printing board and of the award of contracts by said board." (Paragraph 4, section 215.) We think it must be said that appellant's duties partake somewhat of those of a private secretary and also of those of a deputy. We believe, however, that appellant was more than a private secretary and probably more than a deputy. In any event, we do not base our conclusion that appellant is not entitled to the benefit of the Soldiers Preference Act on the ground that he was a mere private secretary or deputy.
In Allen v. Wegman, 218 Iowa 801, 254 N.W. 74, it was held that the head bookkeeper in the state treasurer's office held a confidential relation to the treasurer. In Hannam v. Commerce Commission, 228 Iowa 586, 292 N.W. 820, it was held that an inspector for the motor transportation division of the state commerce commission was within the confidential relation exception. In Bowman v. Overturff, 229 Iowa 329, 294 N.W. 568, it was held that a jailer or turnkey in the Polk county jail held a confidential relation to the sheriff. We think the state superintendent of printing, in view of the statutory provisions relating to the printing board and the superintendent, holds a strictly confidential relation to the board. We believe appellant is as clearly within the confidential relation exception to the preference law as were any of the appointees in the Allen, Hannam, and Bowman cases.
Since the statute which authorized the board to appoint appellant provides that his service is during the pleasure of the board, and the legislature has provided that one holding such confidential position is not entitled to the benefits of the Soldiers Preference Act which appellant seeks to invoke, the case is affirmed. — Affirmed.
CHIEF JUSTICE and all JUSTICES concur. *Page 27
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This case grows out of an automobile accident which occurred at a street intersection in the city of Indianola, Iowa. At the time of the accident, the plaintiff-administrator, accompanied by his wife, the decedent, was driving eastward in Third street in *Page 47
said city, and the defendant Coltrane was driving an automobile owned by the defendant Ogle northerly in G street in said city. As a result of the collision, the plaintiff's wife received injuries from which she died about a week following the accident. The action, as originally brought, was against the defendants, Coltrane, the driver of the car, Ogle, owner of the car, and a Reverend H.G. Gibson, by whom the car had been rented from Ogle. Upon a former trial of the case the court directed a verdict in favor of the defendant Gibson, and submitted the case to the jury as to the other defendants. The jury disagreed, and the case was tried the second time. Upon the second trial the defendants Ogle and Coltrane filed separate motions for a directed verdict at the close of plaintiff's evidence and renewed said motions with some additions thereto at the close of all the evidence. The trial court sustained the motions, directed a verdict in favor of the defendants, and entered judgment thereon. Plaintiff appealed.
The motions of the defendants for a directed verdict were each based on several grounds and were sustained generally by the court. The motions, though separate, were practically identical as to many of the grounds thereof, and the first two grounds of each of said motions were, in substance: (1) That the plaintiff had failed to prove negligence on the part of the defendant; and (2) that the plaintiff had failed to prove freedom of his decedent from contributory negligence. If the court was correct in sustaining the motions on either one of these two grounds, the plaintiff-appellant cannot, of course, recover in this action, regardless of what the ruling should have been on the other grounds of the motions if each ground had been ruled on separately. While not deciding or even suggesting that the first ground of the motions should have been sustained, we deem it sufficient to consider only the second ground of the motions in regard to contributory negligence on the part of the plaintiff's decedent.
The evidence shows without dispute that the accident happened about 10 o'clock on a Sunday forenoon in the month of July, 1931; that the day was warm and clear; that neither of the intersecting streets was paved; that the graded portion thereof was dry and dusty and from 25 to 35 feet wide and the corners somewhat rounded; that plaintiff and decedent were married in 1905 and had lived in the vicinity of Indianola during all the time from their marriage until the time of the accident; that there was considerable travel *Page 48
on both streets at this intersection; that G street south from the intersection runs through what is classed as a suburban district and there is no speed limit on this part of said street; and that neither the plaintiff nor his decedent saw the car of the defendants at any time before the collision occurred. There is no evidence on the part of the occupants of the defendant car or any other eyewitness to the accident. According to plaintiff's testimony, he was driving at a speed of approximately 10 miles per hour as the front wheels of his automobile passed over the sidewalk on the west side of G street and along the west side of the intersection. He testified that his own and the decedent's faculties of sight and hearing were good and that at this point both he and the decedent looked southward on G street. The evidence shows that there was no obstruction to the view to the southward and, according to his own testimony, he had a clear view of G street to the south of the intersection for a distance of from 225 to 250 feet before the surface of the street made a dip, and that he did not know whether or not a car could be seen beyond the point where this dip to the southward began. He further testified that neither he nor his decedent saw the car of the defendants when they looked to the southward; that they both then looked to the northward on G street, and, seeing no cars in that direction, proceeded across the intersection at a speed of about 10 miles per hour toward the east side of G street, without either of them again looking to the south; and that, when his car reached a point where the front part was going out of the intersection and where the back part of his car was about 25 feet east of the sidewalk along the west side of the intersection, the car of the defendants coming from the southward struck the rear right wheel of his car. He also testified that the length of his car was about 10 feet, and that at all times while proceeding into and across the intersection he could have stopped his car practically instantly.
From this testimony of the appellant it appears, therefore, that, from the time he and decedent looked to the south, as the front wheels of his car were just about on the crosswalk on the west side of the intersection, the rear of his car would have been about 10 feet to the west thereof, and, if at the time of the accident the rear of his car was 25 feet east of this sidewalk, he would have traveled a total distance of 35 feet from the time he and decedent looked to the southward until the collision occurred. As above stated, aside from the occupants of the cars, there was no eyewitness to the accident. *Page 49
One witness for the plaintiff testified that she saw the defendants' car as it approached the intersection and while it was somewhere between half a block and a block from the intersection, and, in her opinion, it was traveling from 40 to 50 miles an hour. This is the only evidence as to the speed of defendants' car, except an admission claimed to have been made by Coltrane in which he is alleged to have said that he was driving at a speed of 35 to 40 miles an hour.
Assuming that the defendants' car was traveling at the maximum speed as testified by plaintiff's witness, it would have traveled five times as fast as the plaintiff's car was traveling while crossing the intersection. The defendants' car could not have traveled more than 175 feet while plaintiff's car was traveling the 35 feet which he testified it had proceeded from the sidewalk on the west side of the intersection to the point where it was struck. There is other evidence which is not contradicted and which tends very strongly to show that the distance from the point where plaintiff claims that he and his decedent looked southward to the point where the road begins to make a dip is more than 300 feet, and there is no evidence that the so-called dip is sufficiently deep at any point so that a car at any point on the road for a distance of 600 feet south of the intersection could not be seen from the point where plaintiff testified that he and his wife looked. Leaving this testimony out of consideration, however, and taking the plaintiff's own testimony in which he states that he and decedent looked down the road southward and could see the surface of the road for 225 to 250 feet, it is quite apparent that the defendants' car must have been upon the road and in plain view of the plaintiff and his decedent at the time they reached the sidewalk on the west side of the intersection where he testified that they both looked to the southward.
Under the undisputed evidence and the physical facts it appears that the defendants' car must have been in plain view on G street and not more than 175 feet south of the intersection at the time that plaintiff and decedent looked to the south. We are not here dealing with a case where either plaintiff or his decedent saw the defendants' car approaching and thought that they would have time to proceed through the intersection before it came in collision with them. The direct and positive testimony of the plaintiff is that both he and decedent looked and that neither of them saw the defendants' car. As has been said in cases involving similar situations, either the *Page 50
plaintiff and his decedent did not look, or, if they did look and did not see what was plainly in their view, they did not use ordinary care in looking. In either event, they were both guilty of contributory negligence, and contributory negligence on the part of decedent is, of course, an absolute barrier to recovery in this action. The physical fact rule applicable to situations such as that presented by the evidence in this case is so well established that it requires no extended citation of authorities. In Kemmish v. McCoid, 193 Iowa 958, loc. cit. 964, 185 N.W. 628, 630, we said:
"It was clearly the duty of Mrs. Kemmish, before entering the highway, to look to the north for approaching vehicles, and not to proceed into the highway if she saw one coming, unless, as a reasonably prudent and cautious person, she believed, and had a right to believe, that she could pass in front thereof in safety. If the approaching vehicle was traveling upon the west side of the traveled portion of the highway at such a rate of speed and so close to the intersection that the driver thereof would not, in the exercise of his statutory and common-law duty, have sufficient time to turn to the left and avoid a collision, then it was her duty to wait until the intersection was passed. If, on the other hand, she had looked and had seen a car approaching, and, as a reasonably prudent and cautious person, believed that she could pass safely into the highway, giving defendant such time and notice as would enable him, in the exercise of his duty, to turn to the left and avoid a collision, she would have a right to do so. She was not required to exercise an infallible judgment, but to use such care as a reasonably cautious and prudent person would exercise under the circumstances. Mrs. Kemmish does not claim, however, that she saw the approach of defendant from the north, nor that she believed that she had time to safely enter the highway and proceed southward thereon in the usual way of travel on the highway before defendant would reach the intersection, but claims that she looked and saw nothing. She is either mistaken in her belief that she looked immediately before going upon the highway, or else she failed to see the car, which must have been very close and in plain sight. In either case, she was negligent."
See, also, Beemer v. Chicago, R.I. P.R. Co., 181 Iowa 642, 162 N.W. 43; Anderson v. Dickinson, 187 Iowa 572, 174 N.W. 402; Sackett v. Chicago, G.W.R. Co. 187 Iowa 994, *Page 51
174 N.W. 658; Barboe v. Sioux City Service Co., 205 Iowa 1074, 215 N.W. 740; Whitman v. Pilmer, 214 Iowa 462, 239 N.W. 686.
We see no escape from the conclusion that the appellant's decedent was guilty of contributory negligence. The judgment is accordingly affirmed.
Appellant's motion to strike appellees' amendment to abstract, which was ordered submitted with the case, is hereby overruled. — Affirmed.
MITCHELL, C.J., and EVANS, ALBERT, and KINDIG, JJ., concur.
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The indictment charges that the defendant, on or about the 23d day of December, 1927, in the county of Mahaska and state of Iowa, did keep and carry around on his person and in an automobile, intoxicating liquors, with the intent and for the purpose of then and there selling and disposing of the same, contrary to law. The record tends to show that in a garage in Oskaloosa, on the evening of the 23d of December, 1927, two witnesses bargained with the defendant for the purchase from the defendant of a half can of alcohol. He refused to sell half a can, but contracted to sell and deliver the whole *Page 1395
can for the agreed price of $18. He stated, however, that he must go out in the country for it. One of the witnesses went along. The other waited in the garage. Each of the witnesses paid a portion of the purchase price, and the can of alcohol was delivered.
I. Sixteen errors relied upon for reversal are shown in the argument, but none of them comply strictly with the rules of this court. Samples are Nos. 6 and 13:
"The court erred in refusing to direct the jury to return a verdict for the defendant on the defendant's motion made at the close of the case." (Abstract page 12, line 25, to page 13, line 11.)
"The court erred in giving to the jury Instruction No. 6." (Abstract 24, line 30, to Abstract 25, line 4.)
It has been repeatedly held by this court that omnibus errors relied upon for reversal, in blanket form such as the foregoing, are not sufficient, under the rules of this court, to present anything for our consideration and determination. Among the numerous cases on the subject we may cite the following: Blakelyv. Cabelka, 207 Iowa 959; Ryan Bros. v. Rate, 203 Iowa 1253;State v. Briggs, 207 Iowa 221; Harrington v. Southern Sur. Co.,206 Iowa 925.
Notwithstanding that, under the rules, there is nothing before us for consideration, we have carefully examined the entire record in this case, and the errors relied upon for reversal. Many of them pertain to alleged errors in sustaining objections made by the county attorney to questions propounded by the defense. In some of these instances, the objections could properly have been overruled; but, upon the whole record, we think the conduct of the trial court in this regard was without prejudice to the rights of the defendant.
Errors relied upon for reversal Nos. 4 and 5 pertain to some testimony tending to show that the defendant sought to, or did, flee from arrest. The errors, if any, in connection with this line of testimony were without prejudice to the defendant.
Upon the whole record here presented, we find no cause for reversal, and the case is — Affirmed.
ALBERT, C.J., and STEVENS, De GRAFF, and MORLING, JJ. concur. *Page 1396
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The town of West Liberty, by appropriate procedure in 1925, ordered a certain paving project, which was duly carried out. The plaintiff was, and is, the owner of property abutting upon such improvement. The following plat will be an aid to the discussion:
[EDITORS' NOTE: PLAT IS ELECTRONICALLY NON-TRANSFERRABLE.]
The plaintiff's property is referred to as art out-lot within the corporate limits of West Liberty. It lies more than one-half mile to the north from the post office in the business part of the town. The paving was laid both upon Columbus Street and upon Maxson Avenue, abutting upon the plaintiff's property to its full dimensions. The controversy between the parties is reduced to a question of fact. The field of dispute which the parties have mutually adopted is the question of the value of plaintiff's tract after the improvement was completed, and whether the assessment levied exceeded 25 per cent of such actual value. Several of the more candid witnesses on behalf of plaintiff fixed the value of plaintiff's tract subsequent to the *Page 458
improvement at "about $2,500." Other witnesses fixed it at a much lower price, — the lowest estimate being put at $50 to $75 per acre for the tract. The acreage involved is less than four acres. So that the plaintiff's evidence presents a range running from $200 to $2,500.
The witnesses for the defendant town, most of whom were members of the city council, fixed the value at approximately $5,000. In the consideration of this conflicting evidence, and in the weighing thereof, we are quite as much concerned with the various reasons given for the estimates as we are in the estimates themselves. For the plaintiff it is said that the property was used as a cow pasture, and was, therefore, nothing more. The tendency of the witnesses was to predicate estimates upon the basis of farm value. Remoteness from the business part of town, want of improvement of the property, want of demand for city property, want of growth on the part of the town, abundance of vacant properties, improved and unimproved, looking for purchasers without avail, are among the more potent reasons which influenced the estimates on the part of plaintiff's witnesses. These reasons are minimized by the defendant, with a considerable showing in support of larger estimates. It appears that Columbus Street is one of the main streets of the town. It is a part of State Highway No. 76. North Columbus Street, which includes the improvement, is generally regarded as being in the most desirable residence section of the town. The south line of plaintiff's property would represent an extension of Tenth Street. Columbus Street is all built up with good residences on both sides from the business part of the town to Tenth Street, save as to one block of low ground between Eighth Street and Seventh Street, and save one lot of 54 feet in width, lying on plaintiff's south line, and owned by his mother-in-law. The sidewalk extends from the town along Columbus Street to the last named lot, and comes, therefore, within 54 feet of plaintiff's property. The electric lights of the town are extended along Columbus Street and Maxson Avenue to the full dimension of plaintiff's property. A street light is maintained at the northeast corner of plaintiff's property. The town sewer extends up Columbus Street to the plaintiff's south line. A water pipe extends along Columbus Street for the full length of plaintiff's property. A fire plug *Page 459
is placed at plaintiff's southeast corner. In the water line T's have been placed, 60 feet apart, along the line of plaintiff's property, for the prospective use of future occupants. The topography of plaintiff's property is well adapted to residence lots. At plaintiff's request, the dirt removed in the construction of the improvement was used to grade the parking on Columbus Street in front of plaintiff's property. In 1926, a vacant lot of 60 feet of frontage on Columbus Street, less than 400 feet south of plaintiff's property, was sold for $1,200 cash. Two residences have been built on platted lots on the east side of Columbus Street opposite plaintiff's property. Another has been built across the northeast intersection from plaintiff's property. On Maxson Avenue, northwest of plaintiff's property, has been built the best residence in town. Calhoun is a north and south street, running parallel with Columbus, and lying 120 feet west of plaintiff's property. It is all built up from Maxson Avenue to the business part of the city. Witnesses for the defendant were of the opinion that all the frontage of plaintiff on Columbus Street and on Maxson Avenue would be worth at the rate of $800 for 60 feet of frontage and 150 feet of depth. The plaintiff bought the property in 1912 at a price of $2,000. He contends, however, that he took it in exchange for worthless notes. He hardly contends, however, that he gave no value for it. The foregoing indicates in a general way the pros and cons which have operated upon the estimates of the different witnesses. It is very manifest therefrom that the defendant's property has something more than cow-pasture value. On the other hand, the estimates of its value must be predicated to some extent upon immediately prospective conditions. In such a case, approximation is the best that witnesses can do in their estimates, and the best that the trial court can do in its finding. We are under the same limitation here. Witnesses on both sides vie in their loyalty to their town. From each side comes the statement that it is the "best in Iowa." It has a population by the last census of 1,890, — the largest in its history. It shows a hopeful growth in the last ten years. It is located upon two lines of railway, which give it direct connections with all points of the compass and with all the largest cities of the United States.
The district court fixed upon a valuation of the property *Page 460
at $3,600, and assessed the plaintiff with 25 per cent thereof. The proportionate cost of the improvement abutting on plaintiff's property, apportioned according to its frontage, would have amounted to more than $2,500. We are of opinion that the valuation thus fixed by the district court was approximately correct. If we were to increase it or diminish it by $100 or by $200, we should find it exceedingly difficult, on this record, to give a reason why. The result reached in the district court is, in our judgment, the best that human judgment can do, upon this record.
The order will be affirmed on both appeals. Costs of the appeal will be apportioned. The parties will be charged with the printing of their own briefs, respectively, and each with one half of the other costs. — Affirmed on both appeals.
STEVENS, C.J., and FAVILLE, KINDIG, and WAGNER, JJ., concur.
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S.L. Hiatt, the plaintiff-appellant, brought suit in the district court on a promissory note payable to him in the sum of $16,500 March 1, 1924. This note was signed by the defendants-appellees, J.E. and S.M. Hamilton, according to the recitals in the instrument, on November 26, 1921. As a part of the proceedings, the appellant, as plaintiff in the district court, asked the foreclosure of certain collaterals, consisting of notes and mortgages which were given by the appellees, it is alleged, to secure the payment of the foregoing note. A part of this collateral security seems to have been furnished by the appellee J.E. Hamilton, and the remainder thereof by the appellee S.M. Hamilton.
Many defenses are pleaded by the appellees. The district court, however, entered a judgment in the full amount of the note in appellant's favor against the appellee J.E. Hamilton. Likewise, as against the appellee J.E. Hamilton, the district court decreed the foreclosure of the collaterals. J.E. Hamilton did not appeal. While the district court granted the appellant the full relief asked by him against the appellee J.E. Hamilton, yet that tribunal denied the appellant a personal judgment against the appellee S.M. Hamilton. Although a personal judgment was thus denied the appellant against S.M. Hamilton, nevertheless the district court granted the appellant the foreclosure of the collateral security given by S.M. Hamilton for the above-named note. Consequently the appellant appeals, because the district court refused to give him a personal judgment against S.M. Hamilton, and S.M. Hamilton appeals because that tribunal granted the appellant the foreclosure of the aforesaid collaterals.
I. Convenience dictates that consideration first be given to the appellant's appeal. Did the district court properly refuse to grant the appellant a personal judgment against the appellee S.M. Hamilton?
Several defenses were interposed by that appellee. For instance, he pleaded want of consideration for his signature on the note. Also, this appellee pleaded that because the appellant failed to collect, preserve, or avail himself of the securities, he, the said S.M. Hamilton, was thereby relieved from any further liability on the note. Again, it was pleaded by the appellee S.M. Hamilton that the appellant did not notify him that appellee J.E. Hamilton failed to pay the note. So, too, it was pleaded by S.M. Hamilton that the appellant, without his consent or knowledge, extended the *Page 217
time for payment on the note. Under the record as here presented, it is not necessary to consider any of the defenses urged by S.M. Hamilton except the one relating to the want of consideration for his signature on the note.
[1] The appellant claims that, although the note is dated November 26, 1921, the same was executed, the consideration therefor paid, and the aforesaid collateral delivered, on July 20, 1920. According to the appellant, this transaction took place in the First National Bank, at Winterset, on the date above mentioned. Upon that occasion the appellant, he contends, was in the bank in the presence of the appellees. At that time and place the Hamiltons, the appellant asserts, both placed their signatures upon the note in question, although the instrument was post-dated. Concerning why the transaction took place on the 20th of July, 1920, while the note is dated November 26, 1921, the appellant does not explain. An explanation concerning why the transaction took place on July 20, 1920, although the note was dated November 26, 1921, is not afforded by the record. One searching for the truth about this matter is offered nothing but conjecture. Conjecture is not sufficient when facts are necessary. Not only does the appellant fail to explain such apparent confusion of dates, but no one else offers or attempts to clear away the perplexing circumstance.
J.E. Hamilton, the appellee, did not testify at the trial, but the appellee S.M. Hamilton did give testimony. This last-named appellee admits that he signed the note in question, but denies that he did so on July 20, 1920. He maintains that his signature was placed on the note November 26, 1921. Furthermore, the appellee S.M. Hamilton declares that when he signed the note, on November 26, 1921, the instrument had already been executed by J.E. Hamilton and was in the possession of the appellant. There is obviously no question that on July 20, 1920, the appellant gave J.E. Hamilton $16,500, or rather, the equivalent thereof in certificates of deposit. Thereafter these certificates of deposit were apparently cashed by J.E. Hamilton sometime near the 20th of July, 1920. During that period, however, the appellee S.M. Hamilton was not in Iowa. He, as a matter of fact, for a considerable period before July 20, 1920, and for a long time thereafter, was in New Mexico and California. S.M. Hamilton himself, as well as his wife, testified to that fact. Nothing in the record indicates that the appellee S.M. Hamilton and his wife were mistaken about this fact. Manifestly, then, *Page 218
S.M. Hamilton was not in Jowa on July 20, 1920. Nor was he in Iowa on any date near that time. Hence S.M. Hamilton is correct when he says that he did not sign the note in question on July 20, 1920. As before explained, S.M. Hamilton testified that the note already had been executed by J.E. Hamilton when it was brought to him by appellant for S.M. Hamilton's signature. The only consideration which ever passed for this note, according to appellant, was the certificates of deposit given to J.E. Hamilton by the former July 20, 1920. If, then, S.M. Hamilton did not sign the note until November 26, 1921, there would be no consideration for his signature under the circumstances. There is no proof in the record sufficient to indicate that S.M. Hamilton's signature was placed on the note without the knowledge or consent of J.E. Hamilton. See Dickerman v. Miner, 43 Iowa 508.
It is not claimed by appellant that the appellee S.M. Hamilton's signature was placed on the note in consideration for an extension of the due date on the indebtedness. Likewise, it is not contended by appellant that on November 26, 1921, when the appellee S.M. Hamilton signed the note, any additional consideration was received either by J.E. or S.M. Hamilton. But one consideration for any of these transactions is claimed or proven by the appellant, and that relates to the original consideration of July 20, 1920, above named. Then, so far as the record is concerned, the appellee S.M. Hamilton signed the note after the transaction between appellant and J.E. Hamilton had been fully completed. There was no new consideration for the signature of the appellee S.M. Hamilton to the note at the later date. Therefore he is not bound as a co-maker or otherwise.
"It is the rule that, if the surety or co-maker signs after the completed transaction between payee and maker, there must be a new consideration, to bind the surety or co-maker." Nolte v. Nolte, 211 Iowa 1289 (local citation 1293).
"* * * a party who signs a note after its execution, delivery, and acceptance is not liable to the payee when there was no consideration for such signing, either in the form (1) of some advantage to some of the signers, or (2) of some disadvantage to the payee, or (3) of an agreement, at the time of the original execution and delivery, that the note would be so signed." Conner v. Henry, 205 Iowa 95. *Page 219
"* * * indorsements made * * * subsequent to the consummation of the loan * * *" are "not binding * * * unless a new or additional consideration is shown. This is well settled law. It is elementary." Northern Tr. Sav. Bank v. Ellwood, 200 Iowa 1213
(local citation 1214).
None of the matters named in the foregoing cases as amounting to a consideration is present as a consideration for the appellee S.M. Hamilton's signature on the note in the case at bar. Without a consideration, then, the appellee S.M. Hamilton is not liable on the note, and the district court properly refused to enter a personal judgment against him.
[2] II. Did the district court wrongfully foreclose the collateral furnished by the appellee S.M. Hamilton? That question is involved on the latter's appeal.
S.M. Hamilton, according to the evidence, delivered to appellant, at the request of J.E. Hamilton, certain notes and mortgages. This was for the purpose of securing the above-named note. Said transaction took place before S.M. Hamilton signed the note in the manner and way before explained, on November 26, 1921. Appellant declares that these collaterals were delivered to him when the aforesaid transaction took place, on July 20, 1920. Each note thus delivered by the appellee S.M. Hamilton to the appellant was indorsed by the former. All, or some, of these notes were secured by mortgages, and the mortgages were duly assigned in writing by the appellee S.M. Hamilton to the appellant.
Nowhere in his answer does S.M. Hamilton plead a want or failure of consideration for the placing of this collateral. Both in his original answer and in the amendments thereto, S.M. Hamilton pleads that there was no consideration for his signature to the note, but he does not at any place make such allegation apply to the collateral. Not having pleaded this want or failure of consideration as a special defense, S.M. Hamilton cannot rely upon it under the circumstances. Apparently the cause was not tried on that theory in the district court. Section 9440 of the 1931 Code and preceding Codes provides:
"All contracts in writing signed by the party to be bound or by his authorized agent or attorney shall import a consideration."
Moreover, Section 9484 of the same Code declares:
"Every negotiable instrument is deemed prima facie to have *Page 220
been issued for a valuable consideration, and every person whose signature appears thereon to have become a party thereto for value."
To overcome the presumption created by the foregoing statutes, it is necessary for a defendant to specially plead and prove want or failure of consideration. Gary v. Northwestern Mut. Aid Assn.,87 Iowa 25; Gould v. Gunn, 161 Iowa 155; Saddler v. Pickard,142 Iowa 691; In re Estate of Rule, 178 Iowa 184. In Saddler v. Pickard (142 Iowa 691), supra, we said, on page 693:
"Prior to the enactment of Section 3340 of the Code [of 1897], probably it was not necessary to plead special defenses. * * * But the statute now expressly provides that `special defenses must be pleaded,' and the only remaining inquiry is whether this was a special defense. In Scott v. Morse, 54 Iowa 732, the court held that an agreement to render legal services without remuneration, to be available as a defense, must be specially pleaded, and the decision has been cited since with approval. * * * this [foreclosure of consideration] was a special defense."
Again, in Gould v. Gunn (161 Iowa 155), supra, reading on pages 161 and 162, this court suggested:
"The effect of these two sections [3069 and 3070 of the 1897 Code], as heretofore interpreted, has been to put the burden upon the defendant of both pleading and proving a want of or a failure of consideration for a written contract."
Consistently this court again said in In re Estate of Rule (178 Iowa 184), supra, reading on page 191:
"It has been held too often to permit of any doubt that the burden is upon the party defending against a written instrument to plead and prove a want of consideration."
Want or failure of consideration, in view of the foregoing statutory presumption, is a special defense. Wilson v. Else,204 Iowa 857. Concerning special defenses, the legislature declared in Section 11209 of the Code:
"Any defense showing that a contract, written or oral, or any instrument sued on, is void or voidable, or that the instrument was delivered to a person as an escrow, or showing matter of justification, excuse, discharge, or release, and any defense which admits the *Page 221
facts of the adverse pleading, but by some other matter seeks to avoid their legal effect, must be specially pleaded." (The italics are ours.)
Not having pleaded want or failure of consideration in the district court, the appellee S.M. Hamilton cannot now rely upon that defense. Accordingly the district court properly granted the appellant a foreclosure of the chattels.
Wherefore, the judgment and decree of the district court must be, and hereby is, affirmed on both appeals. — Affirmed on both appeals.
WAGNER, C.J., and EVANS, MORLING, and GRIMM, JJ., concur.
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This is an action by Jesse Gearhart and his wife, Lucille Gearhart. The husband assigned his claim for damages to his wife. The action arose out of an injury suffered by Lucille Gearhart on November 6, 1943, between the hours of nine and ten p.m. She was a passenger on defendant's curbliner and got off at the southeast corner of Sixth and Euclid Avenues in Des Moines, which cross each other at right angles. The curbliner was headed north on Sixth Avenue but its route was west from the intersection on Euclid. When plaintiff left the car at the southeast corner of the intersection the traffic lights to the north were red and she walked across Sixth Avenue to the southwest corner *Page 215
of the intersection. Then when the traffic lights changed for north-and-south traffic she proceeded north across Euclid Avenue from the southwest corner of the intersection toward the northwest corner, following the line of traffic opened by the green light. She claims that she was within twelve or fifteen feet of the north curb of Euclid Avenue, and in plain view of the driver of the curbliner, who drove the bus in a left-hand turn west on the north side of Euclid Avenue. Plaintiff followed the green light, and, as she asserts, without any knowledge on her part that the curbliner was approaching, was struck by the left front corner of the vehicle, knocked down and dragged on the pavement and severely injured, necessitating confinement in a hospital for three months, surgical operations, and care and treatment by a physician after her release from the hospital. She alleges negligence of defendant and lack of contributory negligence on her part. She claims medical expense of $345, hospital expense of $466.25, and injury to clothing of $100, all of which amounts were conceded by defendant to be correct, and $400 expense incurred in providing care for her household and two children while disabled, making a total of $1,311.25. She also asks judgment for damages and expense incurred in the sum of $4,000.
There was denial by defendant and specific denial of negligence and of the claim of lack of contributory negligence by plaintiff. The jury returned a verdict for plaintiff in the amount of $1,311.25. The court at the conclusion of plaintiff's testimony withdrew her plea as to the doctrine of last clear chance and her proffered instructions thereon.
Plaintiff bases her appeal on the following grounds: (1) failure of the court to admit the hospital records offered in evidence by her (2) failure of the court to instruct the jury on the doctrine of last clear chance (3) failure of the court to set aside the verdict of the jury and grant a new trial by reason of the inadequacy of the verdict (4) that the court was in error in giving certain instructions hereinafter referred to and (5) that the court was in error in withdrawing division (e) of paragraph 12 of the petition. Defendant has appealed on the ground that the trial court was in error in failing to *Page 216
direct a verdict for defendant at the close of plaintiff's testimony and at the close of all the testimony, and failure to sustain defendant's motion for judgment notwithstanding the verdict. The evidence in relation to these assigned errors will be referred to hereafter under separate assignments.
[1] I. Dr. Howard Gray testified as to the extent of plaintiff's injuries. Plaintiff offered also the hospital records and as foundation therefor called Mrs. Mabel Clark, an employee of the hospital, who testified she assisted Sister Mary Louise in her work of keeping the records. She identified the records of the hospital in connection with the case of Lucille Gearhart, including the history on the first sheet, the personal history and physical examination on the next, and the operative sheets and nurses' notes at the back of the record. She testified that the records were made in the usual and ordinary course of business and were part of the records of Mercy Hospital in Des Moines, and as to the manner in which the chart is ordinarily made up; that it is sent to the floor with the patient; that the record indicates that the physician or interne makes a physical and personal history and signs it; that the records indicate the temperature, pulse, and respiration. The witness did not make any part of the records but testified as to the manner in which they were made and that they were made by the nurses and doctors in charge of the patient. A nurse as witness testified as to entries she had made on the record, that they were made at the time of admission of the patient to the hospital, that they were correct and true so far as they relate to facts, and the notations on the front side of the page were the day nurse's notes. The witness identified some of the entries on the sheets as made by other nurses, but some she could not identify, and testified that some of the nurses who made the entries could not be produced. On objection the court refused to admit these records in evidence, both as an entirety and as to separate items.
The question, therefore, is, Are the records of a public hospital, duly identified, admissible in evidence to show the condition of the patient as bearing on the amount of pain *Page 217
and suffering? This is a question which has never been ruled on by this court but it has arisen in many jurisdictions and the courts are divided on the question of admissibility.
In 75 A.L.R. 378, in the annotations to Lund v. Olson,182 Minn. 204, 234 N.W. 310, 75 A.L.R. 371, the question is fully reviewed and the cases listed which hold both for and against the admissibility of hospital records. The editorial note states:
"There is apparently some conflict among the courts as to whether such evidence is admissible at all; there is even more confusion as to the reason. It is obvious that such evidence can only be admitted under some exception to the hearsay rule, and that the proper foundation must be laid for bringing the case within the particular exception. Nevertheless, in many instances such evidence has been excluded without the court clearly stating whether it was for the lack of a proper foundation, and without intimating whether such evidence is admissible in any event. Consequently, some difficulty has been experienced in grouping the cases from the various jurisdictions under appropriate rules, as well as in reconciling cases from the same jurisdiction. It is believed that in many of the cases where such evidence was excluded, in the absence of some other assigned reason, it was for the reason that a proper foundation had not been laid."
In 120 A.L.R. 1124, in the annotations to Clayton v. Metropolitan L. Ins. Co., 96 Utah 331, 85 P.2d 819, 120 A.L.R. 1117, additional cases are cited and reviewed. The editor says that the conflict still exists, as does the confusion as to the reason for the admission or exclusion of such evidence. Many of the cases where the question has arisen have occurred in states where hospitals are required by statute to keep records, being considered as public documents. It would require an undue extension of this opinion and be of no value to undertake to review even a part of these conflicting pronouncements of the courts of the various states. The majority rule seems to favor the admission of such records when properly identified and the proper foundation is laid. *Page 218
If admissible, these records would constitute one of the exceptions to the hearsay rule, such as dying declarations, statements of fact against interest, books of account, declarations about family history, etc. It is apparent that hospital records cannot be governed by the same rules or principles as applied to books of account nor admitted under our statute relating to such entries. In VI Wigmore on Evidence, Third Ed., 36, section 1707, the author strongly favors admissibility, stating that the medical records of patients at a hospital organized on a modern plan should be placed under the exception to the hearsay rule and should be admissible either on identification of the original by the keeper or offer of the certificate of a sworn copy. He states that the reasons for admissibility of evidence of such exceptions are the necessity and circumstantial guarantee of trustworthiness which are the bases for the admission of all such exceptions. The necessity of admission is that the calling of all the attending physicians and nurses who have co-operated to make the record even of a single patient would be a serious interference with the convenience of hospital management. There is a circumstantial guarantee of trustworthiness:
"* * * for the records are made and relied upon in affairs of life and death. Moreover, amidst the day-to-day details of scores of hospital cases, the physicians and nurses can ordinarily recall from actual memory few or none of the specific data entered; they themselves rely upon the record of their own action; hence, to call them to the stand would ordinarily add little or nothing to the information furnished by the record alone. The occasional errors and omissions, occurring in the routine work of a large staff, are no more an obstacle to the general trustworthiness of such records than are the errors of witnesses on the stand. And the power of the Court to summon for examination the members of the recording staff is a sufficient corrective, where it seems to be needed and a bona fide dispute exists."
In referring to the lack of opportunity for cross-examination, it is stated that, "common sense and experience have *Page 219
from time to time pointed them out as practically adequate substitutes for the ordinary test" by cross-examination; and further, in generalizing, the author states:
"* * * there is ample authority in judicial utterances for naming the following different classes of reasons underlying the exceptions:
"a. Where the circumstances are such that a sincere and accurate statement would naturally be uttered, and no plan of falsification be formed;
"b. Where, even though a desire to falsify might present itself, other considerations, such as the danger of easy detection or the fear of punishment, would probably counteract its force;
"c. Where the statement was made under such conditions of publicity that an error, if it had occurred, would probably have been detected and corrected." V Wigmore on Evidence, Third Ed., 204, section 1422.
We are satisfied that the above rule laid down by the author, that such records are admissible, is the correct one; that such records are not only supposed to be true but must be true in order that the safety, and even the life, of patients whose care is entrusted to physicians, nurses, and employees of the hospital may be assured, and for the further reason that in records such as this no reason exists for any fraudulent misrepresentation as to the condition of the patient. A party to an action is entitled to whatever information may be properly adduced for the court and the jury, and where such information can be obtained under circumstances that indicate that it is true, and no reason exists to indicate that it was false, the interests of justice require that such evidence should be admitted. The rule of admission applies with full force to a general public hospital where the records are for the benefit of all persons concerned in the care of the various patients. There seems to be no reason why they should not be admitted and become a part of the record in judicial proceedings growing out of or concerned with the disability of the patient. In this instance we are satisfied that the chart and hospital report, or records, should have been admitted. *Page 220
To the objection made by defendant that every material need essential to plaintiff's proof was testified to and the record was purely cumulative in character we say that we know of no rule which prevents the admission of testimony of more than one witness to facts in a lawsuit. It is true the doctor testified as to the condition of plaintiff and treatment in the hospital, but plaintiff was entitled to the additional testimony shown by the day-to-day record of her condition.
As to the further objection that there was no proper foundation laid, we are satisfied, as indicated by what we have heretofore said, that the proof that these were the regular charts of the patient, kept and used by the hospital in her care and treatment, was sufficient to warrant their admission.
[2] II. At the conclusion of plaintiff's testimony the court withdrew from the jury various allegations of negligence, including division (e) of paragraph 12 of the petition embodying the doctrine of last clear chance and plaintiff assigns this as error under division 5. If plaintiff was entitled to have the theory of last clear chance submitted to the jury, then the court was in error; but, if the court was correct in holding that under the evidence the doctrine of last clear chance did not apply, then there was no error in the withdrawal, so that divisions 5 and 2 of plaintiff's assignment of error may be considered together. Was the court correct in refusing to submit this theory of the case to the jury? In division 2 of her assigned errors plaintiff complains that the trial court erred in failing to embody in its instructions plaintiff's requested instructions 5 and 6 pertaining to the doctrine of last clear chance.
It is the opinion of the majority of this court that the doctrine of last clear chance should have been submitted to the jury. If so, the court was not correct in its rulings. The majority hold that there is sufficient circumstantial evidence to justify a finding that the bus driver, notwithstanding his denial, saw plaintiff and knew her peril in time, by the exercise of ordinary care, to have avoided injury. There is no dispute that there may be a finding of negligence under the last-clear-chance doctrine on circumstantial evidence; nor is there any dispute in the testimony that the area in question *Page 221
was well lighted. One witness says visibility was one hundred per cent on the night of the collision. There were several passengers on the curbliner and one of them, Florence Wooldridge, according to her testimony, saw plaintiff a substantial time before the collision, stating that the plaintiff was plainly visible to her when first seen. Similar testimony was given by Jo Ann Rogers, Norma Johns, and Mary Johnson, passengers on the bus. There was no evidence that there was any vehicle near the intersection except the bus and a truck driven by one Wolf, which truck was some one hundred thirty-five feet west on Euclid Avenue, and plaintiff was the only pedestrian crossing Euclid at the time.
Testimony of the bus driver was:
"I had looked out the [left] side window as I was crossing the intersection beginning to make the turn. * * * as I rounded the curve I looked out the side window."
On cross-examination he testified:
"I was looking right out of the window at the time I was turning and looking to my left all the time. * * * I was looking to my left when I started. * * * I was right up against the windows marked `O' and `X' [referring to an exhibit]. I could see through these windows, both `O' and `X,' all the time I was crossing from the southeast to the northwest corner. * * * I was looking ahead and at the side all the time until I heard the thud, but I never saw Mrs. Gearhart."
The window marked "O" was in the front of the bus; the one marked "X" was at the front end of the left side.
It was stipulated that Sixth Avenue is sixty-six feet wide at this point; Euclid is seventy feet wide west of the intersection and eighty feet wide east of Sixth.
There was evidence that the bus could have been stopped within a very short distance. On direct examination the driver said:
"I was traveling about four miles an hour. The curbliner did not move over three or four feet after the impact with Mrs. Gearhart. * * * I stopped immediately." *Page 222
On cross-examination this witness testified:
"* * * I could have stopped the bus within three or four feet." Another witness testified:
"I heard a thud at about the left-hand corner of the bus. It went about a foot after the thud and stopped right away."
Two witnesses saw plaintiff as the bus made the turn and thereafter, and others about the time the front part of the bus was entering the pedestrian lane, if not in it. The truck driver, according to his testimony, saw plaintiff in peril before the collision, when he was about one hundred thirty-five feet west of the intersection, and attempted to attract the bus driver's attention by flashing his lights and sounding his horn. A witness for defendant, Brady, standing at the southwest corner of the intersection, saw plaintiff before she fell, "in the act of toppling," about halfway between the front of the bus, and the front wheel (five and one-half feet).
With the exception of the bus driver and Brady, who had just come out of a store, all witnesses who were in a position to see the plaintiff did see her. If the driver had seen plaintiff as soon as such witnesses did the collision could have been avoided by ordinary care. The driver had the best opportunity to see plaintiff in a place of peril, and he testified that he looked vigilantly. It was his legal duty to maintain a lookout. Lynch v. Des Moines R. Co., 215 Iowa 1119, 1127, 1128, 245 N.W. 219.
In view of the other testimony the jury was not bound, under the circumstances, to believe the bus driver's testimony that he did not see plaintiff. Murphy v. Quick Tire Service, Mo. App.,47 S.W.2d 202, 206; Davidson v. Vast, 233 Iowa 534, 538,10 N.W.2d 12, 15, and cases cited.
It is further held that a finding of actual knowledge of plaintiff's perilous position may be based on the driver's duty to maintain a lookout and the fact that he had a clear field of vision. Carr v. Inter-Urban R. Co., 185 Iowa 872, 879,171 N.W. 167, and cases cited; Wilflin v. Des Moines City Ry. Co.,176 Iowa 642, 645, 646, 156 N.W. 842; Lynch v. Des Moines R. Co., supra; Groves v. City of Webster City, 222 Iowa 849, 856,270 N.W. 329. *Page 223
In view of this holding it naturally follows that the jury should have been instructed as to the doctrine of last clear chance, not necessarily in the language of the proposed instructions but explaining the plaintiff's rights and defendant's duty under that theory, and the court was in error in striking the said division (e) of paragraph 12 from plaintiff's petition.
[3] III. Plaintiff excepts to the court's refusal to grant her motion for new trial. The grounds of the motion were that the damages were inadequate and made no provision for pain and suffering and failure of the court to instruct the jury as to the law applicable. Since there must be a reversal and a new trial, we think it unnecessary to rule upon this.
The claim of plaintiff is that the verdict of the jury was in the exact amount of the three items of expense admitted by defendant to be correct, and in addition, the $400 charge for services of plaintiff's daughter. Plaintiff claims this indicates there was no allowance for pain and suffering, while defendant denies this inference by arguing that no one can say just what the jury allowed for expenses of the daughter's services, whether it was the full allowance of the $400 claimed or was a partial allowance for such item and a partial allowance for pain and suffering.
There is no question, under our decisions, that a new trial may be granted for inadequate damages and such is allowed under Rule 244 of the Rules of Civil Procedure, but, as stated, we need not consider this objection further. Had the hospital records been admitted, with a detailed account of the patient's progress and condition, the verdict might have been such that there could be no controversy on this point.
[4] IV. Plaintiff contends that the court should have given her requested instruction 4 — that is, instructed the jury that defendant had admitted the hospital and nurses' bills and the reasonable value of the clothing destroyed. However, the record was before the jury and neither party contends the verdict did not cover such items. The court fully instructed as to the various items claimed which plaintiff would be entitled to recover in event the jury found defendant liable. There was no reversible error in this respect.
[5] V. On defendant's appeal it is claimed that the court *Page 224
was in error in authorizing the jury to find plaintiff free from contributory negligence on the showing only that she was walking on an unmarked crosswalk with a green traffic light in her favor and without testimony that she looked and listened; and that the court erred in overruling defendant's motion for directed verdict based on the ground that plaintiff had failed to carry her burden by showing that plaintiff was free from contributory negligence. This claim of error was preserved throughout the record, in the motion for directed verdict at the close of all the evidence and defendant's motion for judgment notwithstanding the verdict, all of which were overruled.
Defendant, in appealing from this action of the court, recognizes the rule that the question of contributory negligence is generally for the jury but claims that in a case of this kind it was the duty of plaintiff to look and listen. That is, that she could not carry this burden without some testimony as to the use of her senses of sight and hearing and that such testimony was not supplied by her testimony that she was on the crosswalk and walking with the green light. It is unquestioned that the green light was in her favor and that she had the right of way, but defendant urges that the pedestrian's right is preferential only, and not absolute, citing various cases, including Horwitz v. Eurove, 129 Ohio St. 8, 193 N.E. 644, 96 A.L.R. 782; Switzer v. Baker, 178 Iowa 1063, 160 N.W. 372; Rolfs v. Mullins, 179 Iowa 1223,162 N.W. 783; Dougherty v. McFee, 221 Iowa 391,265 N.W. 176; and 5 Am. Jur. 664, section 293.
The question resolves itself into this: Was the plaintiff, while crossing the intersection, free from contributory negligence in following the green light, with no showing in the record that she looked and listened? The statute, section 5019.06, Code of 1939, gives the right of way to the person following the green light, and a driver crossing an intersection or turning on an intersection is bound to recognize that right. In the second case of Swan v. Dailey-Luce Auto Co., 225 Iowa 89,277 N.W. 580, 281 N.W. 504, as well as in the third case,228 Iowa 880, 293 N.W. 468, the ruling of *Page 225
this court in part was that a person crossing the street is not required to anticipate negligence on the part of another but is justified in assuming that the other will not violate the law. Citing 45 C.J. 954, and various cases.
"Plaintiff was not required to keep a constant lookout for cars from both directions. This is self-evident because he cannot look both ways at the same time. A pedestrian is only required to exercise ordinary care and whether he did so is ordinarily a question for the jury." Swan v. Dailey-Luce Auto Co., 225 Iowa 89,94, 277 N.W. 580, 583.
The Swan cases did not involve a question of lights but did involve the question of contributory negligence as failing to keep a lookout. See, also, Lawler v. Gaylord, 233 Iowa 834,10 N.W.2d 531, and cases cited; Lawson v. Fordyce, 234 Iowa 632,12 N.W.2d 301, and cases cited, holding that it is not necessary to keep a constant lookout. This latter case cites, among others, to the same effect, Lawler v. Gaylord, supra. See Robertson v. Carlgren, 211 Iowa 963, 234 N.W. 824.
This rule is laid down in 5 Am. Jur. 761, section 453:
"In accordance with the well-settled rule that a pedestrian starting to cross a street at a crossing, with the traffic signal in his favor, has the right of way over traffic until he reaches the opposite curb, it is clear that a pedestrian who does not continually look for approaching vehicles as he makes such crossing is not thereby rendered contributorily negligent in the event of an accident."
See, also, 5 Am. Jur. 760, section 452, and notes and cases cited.
In most of the Iowa cases there was evidence that at some time prior to the collision plaintiff had looked before crossing the intersection. In Rogers v. Jefferson, 224 Iowa 324, 275 N.W. 874, and Rogers v. Jefferson, 226 Iowa 1047, 285 N.W. 701, plaintiff saw defendant's car approaching from the west when plaintiff was about five hundred feet south of the intersection but did not look again. In both cases the question of contributory negligence was held to be for the jury. *Page 226
Defendant assails the ruling of this court in the case of Roe v. Kurtz, 203 Iowa 906, 210 N.W. 550, a case which has frequently been followed in other cases, including the Rogers cases, claiming that it is bad law and should be overruled. We do not agree. In most of the cases cited there was some evidence of plaintiff's looking before the accident, yet in others plaintiff looked only after he approached the intersection and before entering it and was held to be not guilty of contributory negligence. We can see little difference between looking for the approach of vehicles at a considerable time prior to the time when the collision might be prevented and not looking, when if plaintiff had looked she would have seen nothing to warrant fear of an approaching danger. Plaintiff was entitled to rely upon the presumption that any approaching vehicle would follow the law and the driver of a vehicle within an intersection or crossing an intersection must proceed with regard to the rights of pedestrians crossing the street. There can be no question about this duty devolving upon the drivers of vehicles, and it applies where the pedestrian has the right of way, whether it be preferential or absolute. In the instant case, had plaintiff looked at the time she started across the intersection she would not have discovered any car approaching the crossing which she was entering. After leaving the curbliner she crossed to the southwest corner of the intersection. When the light controlling north-and-south traffic turned green she started from the southwest corner and the curbliner started in the same direction and each proceeded north on parallel routes until the curbliner changed to the west on the east-and-west avenue. Had plaintiff looked to the right she would have seen the curbliner, not traveling toward her but proceeding in the same direction she was going. As stated, she was not required to look at all times but only to use ordinary care and caution. Thus, if she had looked when entering the intersection she would have seen nothing to cause her to anticipate a collision. It is a well-known fact that a curbliner is not limited to a fixed line of travel, as is a streetcar, but may and does proceed over the street to the right of the center line thereof. It does not travel on a track so that the rails might to some extent have *Page 227
warned plaintiff that the car was to turn. Also, the driver of the curbliner in turning and passing to the left was proceeding against the ordinary stream of traffic and would be held to such care as to avoid pedestrians proceeding with the green light. We believe the pedestrian has a right to rely upon the driver's observing this rule. We are not holding that a person correctly following the route of travel with a green light in his favor may not be guilty of contributory negligence. Such person might be heedless, or travel with such a lack of caution as amounts to negligence; and he may not loiter or interrupt travel in such a way as to render himself guilty of contributory negligence.
Under the evidence in this case the question of lack of care by plaintiff was not one of law but was for the jury to determine and the ruling of the court was correct.
For the reasons stated, in plaintiff's appeal the case is reversed and remanded, and in defendant's appeal affirmed. — Reversed and remanded on plaintiff's appeal; affirmed on defendant's appeal.
All JUSTICES concur.
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Louis Chipokas, father of Kathryn Chipokas, a child four years of age at the time of the accident, brought this action to recover moneys which he had expended in hospital, nursing, and medical attention for Kathryn, in the amount of $973. To the petition the appellees filed answer, setting up certain defenses, among them the following: That Louis Chipokas, as the next friend of Kathryn Chipokas, had, prior to that time, and to wit, on the 29th day of August, 1932, filed a petition in the district court of Linn county, Iowa, against these same appellees as defendants, seeking damages on behalf of the said Kathryn Chipokas for the injuries which the child sustained, and, in addition thereto, he sought to recover in that action the amount of money which he had expended for hospital, nursing, and medical care; that that cause was tried and Louis Chipokas testified as one of the witnesses, setting out the amounts of moneys which he had expended, being the same identical amounts which he now seeks to recover in this action for hospital, nursing, and medical care; that the case was submitted to a jury and the jury returned a verdict in favor of the defendants (appellees) and against the said Louis Chipokas; that the question of damages, for hospital, nursing and medical care and attention has been adjudicated, and the plaintiff (appellant) cannot now relitigate the question of said damages, nor claim said damages as his property. In addition to said defense, appellees pleaded that the driver of the car was not guilty of negligence, and denied each and every allegation contained in the petition.
The case proceeded to trial. Evidence was offered, and at the close of the evidence the appellees moved to direct a verdict in their favor, setting up various grounds, and among same included the following: That the evidence and all of the evidence taken together shows conclusively that the injuries Kathryn Chipokas sustained are the result of an unavoidable accident, to wit, from the child running out from a hidden place in front of the automobile being operated by the defendant Peterson, at the time of the accident; that there is no showing of any kind of any of the acts of negligence set forth in plaintiff's petition as amended or that Peterson was guilty of any act of negligence that was the proximate cause of the injuries to Kathryn Chipokas. Other grounds are contained in the motion, *Page 1074
but it will not be necessary to set out same, for under our decisions, where the motion is sustained generally, as in the case at bar, then, if any ground in the motion is good, this court will not set aside the ruling directing the verdict.
The evidence in this case shows that the Center Point road at the place of the accident was a street that ran north and south in the residence district in the city of Cedar Rapids, Iowa. That it was 39.4 feet wide. There was a street car track that ran practically along the middle of the street and that it was 13.2
feet from the west curb of Center Point road at the point where the accident occurred to the west rail of the street railway track. The day of the accident Kathryn Chipokas and her little brother, together with their mother, were walking south on the sidewalk on the west side of Center Point road, the mother having hold of Kathryn by the hand. There were two cars parked on the west side of the road in front of what is known as the Mason property. There was a space of some feet between the cars. The cars were approximately six feet wide. Peterson was driving south in his automobile. Kathryn in some way or other broke away from her mother and ran across the sidewalk and into the street, going either behind the car that was parked near the gate in front of the Mason property, or in front of it. One witness testifies she ran behind the car and the other that she ran in front of it. But, regardless of whether it was in back or in front of the parked car, she ran out into the street and was struck by the Peterson car when she had about reached the west rail of the street car track. Peterson stopped his car within a few feet, the little girl rolling to the side, so that she was not run over. However, she was seriously injured, her right thigh being broken, and she received other injuries. The record shows that she has no permanent injuries.
An action was brought by the father as best friend for the daughter against Peterson and others. That case was submitted to the jury, and the jury returned a verdict in favor of Peterson, refusing to allow any damages.
The negligence claimed here is that Peterson failed to maintain a proper lookout and to have his car under control, and that he violated an ordinance of the city of Cedar Rapids, prohibiting driving of cars in the residential districts in excess of a speed of twenty-five miles per hour. Peterson himself testified that he did not see the child, and this is easily understood, for the distance from the *Page 1075
west curb line of the street to the spot where the child was struck is a little more than thirteen feet. She either ran in front or in back of the car that was parked and this car was parked about a foot from the curb line. The width of the car was approximately six feet. This would take up seven feet of the street, leaving only six feet in which this youngster was running when Peterson came along. There is no evidence in the record of Peterson driving in excess of twenty-five miles an hour, except the evidence of one witness, who had never driven a car at the time that he testified. And this witness testified, as did all the witnesses, that Peterson stopped his car within a few feet of the place where he struck the child. All the other evidence shows that Peterson was driving between twenty and twenty-five miles an hour. True, he did not sound the horn or give any warning, but there was no reason for doing so because he did not see the youngster. And, as the child darted out from in front or in back of the parked car, he had no opportunity of seeing her. The scene of the accident was not at a crossing or intersection. Peterson was not guilty of negligence just because this child, unfortunately, suddenly and unexpectedly ran out into the path of his automobile. This, no doubt, was the view of the jury in the former case, in which the same evidence was submitted, and in which the jury returned a verdict in favor of Peterson.
This court has in its recent decisions laid down rules which it believes will help protect the children of this state. In the case of Webster v. Luckow, reported in 219 Iowa 1048, loc. cit. 1053, 1054, 258 N.W. 685, at pages 687, 688, this court said:
"The case of Silberstein v. Showell, Fryer Co., 267 Pa. 298, 109 A. 701, 703, used this language: `When children are on the street, playing at a public crossing, plainly visible as the driver approaches, and one of them is in the act of crossing the street, in view of the driver, 50 feet away, his obvious duty, on approaching the crossing, is to bring his car under such control as the circumstances demand. With his car under this control, as he approaches, if he attempts to pass the child in the rear, his car should still be under control, the control that good sense demands, so that, responsive to its irrational acts, he can stop it to avoid injury. He should expect children's negligent acts.
The sudden twisting and turning of the child, caused by the movement of the car, or the noise it made, would not excuse him.' In the case of Frank v. Cohen, 288 Pa. 221, 135 A. 624, 625, the court stated: `He was approaching *Page 1076
a place where school children could be seen on the streets. He may not have known a school was located at this particular place; but the presence of children in large numbers in his immediate way should have caused him to exercise the degree of care their presence required. Children are capricious; they act heedlesslywithout giving the slightest warning of their intentions. Theydart here and there with the exuberance of youth. No law or courtedict will stop them; we shall not attempt to do so, but ratherwarn those who may meet them to be on the lookout.' Practically the same rule announced in the Pennsylvania cases and here contended for by appellant has been adopted by the courts of Louisiana, Virginia, West Virginia, Oregon, California, and Wisconsin, as shown by the following cases: Jacoby v. Gallaher, 10 La. App. 42, 120 So. 888; Fontaine v. Dorsey, 15 La. App. 282, 131 So. 506; Brown v. Wade (La. App.) 145 So. 790; Price v. Burton, 155 Va. 229, 154 S.E. 499; Aliff v. Berryman, 111 W. Va. 103, 160 S.E. 864; Metcalf v. Romano, 83 Cal. App. 508,257 P. 114; Forrest v. Turlay, 125 Or. 251, 266 P. 229; Pisarek v. Singer Talking Mach. Co., 185 Wis. 92, 200 N.W. 675; Ruka v. Zierer, 195 Wis. 285, 218 N.W. 358; Hanes v. Hermsen,205 Wis. 16, 236 N.W. 646."
But the rule laid down in the above-cited case does not apply to the facts in the case at bar. Peterson had no opportunity to see this child in time to have prevented this accident. He was not driving at an excessive speed. He had his car under control, as was demonstrated by the fact that he stopped it within a few feet after striking the child. The appellant has failed to prove that Peterson was guilty of negligence. This was one of the essential elements of his case. The lower court was right in directing the verdict, and the same must be, and it is hereby, affirmed.
ANDERSON, C.J., and POWERS, DONEGAN, HAMILTON, and KINTZINGER, JJ., concur.
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The allegations of the petition disclosed that the plaintiff had a valid mortgage upon an automobile, executed by the owner thereof, one Julius Wolf. The petition also disclosed that the defendant Smith, purporting to be a constable, had levied upon such automobile an execution against Julius Wolf, and in favor of the defendant P.M. Christensen. After the levy, the plaintiff gave appropriate notice to the defendant Smith, as required by statute. Smith, having been indemnified by his codefendants, proceeded under his levy, and sold the property. The defendants' demurrer was predicated upon two grounds: (1) That the petition did not aver that the mortgage had ever been recorded; (2) that it did not aver any notice to the defendants.
The question presented involves a construction of Section 10015, Code of 1924 (Section 2906, Code of 1897). It is as follows:
"10015. No sale or mortgage of personal property, where the vendor or mortgagor retains actual possession thereof, is valid against existing creditors or subsequent purchasers, without notice, unless a written instrument conveying the same is executed, acknowledged like conveyances of real estate, and such instrument, or a duplicate thereof, is duly recorded, or filed and deposited with the recorder of the county where the property shall then be situated, or if the mortgagor be a resident of this state, then of the county where the holder of the property resides."
In the absence of the foregoing section, the plaintiff's mortgage, being valid as against the mortgagor, would have been valid as against all others, regardless of the question of recording or of notice. The effect of the statute is to render the mortgage, if unrecorded, invalid as to "existing creditors or subsequent purchasers, without notice."
Is the technical burden of proof upon the plaintiff, as mortgagee, to allege and prove that the defendant was not an "existing creditor or subsequent purchaser, without notice;" or is it upon the defendant to allege and prove that he was an "existing creditor or subsequent purchaser, without notice?" Each party herein contends that the burden is upon the other.
The plaintiff, as appellant, relies for authority upon the following of our previous decisions: Diemer v. Guernsey, *Page 37 112 Iowa 393; Zacharia v. Cohen Co., 140 Iowa 682; Bartlett v. Bolte,193 Iowa 1063.
On the other hand, the appellees rely upon the following of our previous decisions as authority for their contention: Carson Rand Lbr. Co. v. Bunker, 83 Iowa 751; State Bank of Dayton v.Felt, 99 Iowa 532; Martin Bros. Co. v. Lesan, 129 Iowa 573.
It is rather a surprise to us to discover that, in all the history of this court, no direct issue upon this particular question has ever before been presented to us for decision, although the question itself is one which has been involved, directly or indirectly, in scores of cases litigated before us. The earliest case cited by counsel is Carson Rand Lbr. Co. v.Bunker, 83 Iowa 751, cited by appellee. In that case, the contest was between two mortgagees. The mortgage of the appellant (defendant) was first executed, but last recorded. After the execution of the mortgage, and before its recording, the appellee (plaintiff) took and recorded his mortgage. The appellant (defendant) averred that the appellee (plaintiff) had notice of his prior mortgage, when he took his own. The court said:
"But the appellant contends that the plaintiff had notice, when the mortgage to it was executed, that the property had before that been mortgaged to Bunker. The burden was on the defendant Bunker to establish this alleged fact by a preponderance of evidence. The court below was of the opinion that the defendant failed to maintain the issue. We have carefully examined the evidence, and reach the same conclusion."
It will be noted that in that case the defendant assumed the burden on the issue, and no dispute was presented as to where the burden of proof was. The declaration of the court was quite incidental, and in accord with the attitude of the parties.
In State Bank of Dayton v. Felt, 99 Iowa 532, cited by appellee, the plaintiff (appellant) was a purported mortgagee of certain horses and cattle, and brought replevin therefor. The answer was a general denial, and a challenge to the sufficiency of the description contained in plaintiff's mortgage to impart notice by recording. The district court sustained this challenge, and refused to admit the mortgage in evidence. This court said:
"The answer contains a denial, and an express statement that the description was insufficient to impart notice. The court, when the mortgage was offered in evidence by plaintiff, so held, *Page 38
and refused to permit it in evidence. That ended appellant'scase. Its right of recovery depended on its mortgage being such as to impart notice. If it relied on actual notice to defendant, it must allege and prove it."
The reliance of appellee is upon the last sentence above quoted. What we have said above concerning the opinion in theCarson case is likewise applicable here. This pronouncement by the court did not purport to be responsive to any issue in the case.
The next case in order of time is Diemer v. Guernsey, 112 Iowa 393, cited by appellant. In that case, plaintiff brought a suit in equity, to foreclose a chattel mortgage. From a decree dismissing his petition he appealed. Certain subsequent mortgagees were made parties-defendant, and the question of priority was involved. The defendants (appellees) claimed priority over the plaintiff's mortgage, because of his failure to record the same, and they prevailed. The court said:
"The burden is upon appellees to show that they took their mortgages without notice of the existence of appellants' mortgage, and this they have failed to do; but on the contrary, it appears quite satisfactorily that the plaintiff and Olney
McDaid did have actual notice of its existence. The testimony of Mr. Johnson and of Mr. Duncan is quite conclusive as to plaintiff's knowledge, and other evidence leaves no doubt but that Olney McDaid also knew of it before they took their mortgage."
The foregoing was responsive to the issues, but it does not appear that there was any dispute between the parties as to where the burden of proof lay.
The next case in point of time, cited by appellee, is MartinBros. Co. v. Lesan, 129 Iowa 573. In that case, plaintiff claimed the right to possession of certain cattle under a chattel mortgage, and brought replevin therefor. It was held here definitely that he had failed to identify the cattle, and that his case was properly dismissed on that ground. On the question of notice, however, we said:
"Even conceding arguendo that there was a sale to Edie, there was no such change of possession as to give third persons dealing with the cattle notice thereof. Intervener took the mortgage under which it now claims for a valuable consideration, — *Page 39
extension of time for the payment of Lesan Dunning's debt, if nothing else, — without notice of the claimed sale to Edie and without any actual notice of plaintiff's mortgage. * * * Plaintiff says, however, that intervener had actual notice of its mortgage when it took its security, and it introduced testimony to establish its claim. It failed, however, to produce enough to overcome the denials made by intervener. Under Section 2906 of the Code, the burden was upon plaintiff to show actual notice, and this it did not do."
So far as appears, plaintiff was asserting notice and assuming proof thereof, and no question of law was raised therein as to where such burden of proof properly lay.
In Zacharia v. Cohen Co., 140 Iowa 682, cited by appellant, there was a controversy between plaintiff, as mortgagee, and the defendant, as alleged owner under a conditional bill of sale. In that case the statute pertaining to conditional sales was involved. Section 10016, Code of 1924 (Section 2905, Code of 1897). The plaintiff prevailed below on the ground that the conditional bill of sale was not properly recorded, and therefore did not impart constructive notice. We said:
"Whether the acknowledgment or mode of indexing was defective, we need not now inquire. The instrument was a valid instrument, as between the parties thereto, even though it had neither been acknowledged nor recorded. Under Section 2905, such instrument, unrecorded, is regarded as invalid only as against a creditor or purchaser from the vendee without notice. Before the plaintiff could be heard to question the validity of such instrument, it was incumbent upon him to show not only that he was the mortgagee of the same property, but that he became such `without notice' of the conditional sale. The burden was upon him both to plead such fact and to prove it. Diemer v. Guernsey, 112 Iowa 393; Blackmanv. Henderson, 116 Iowa 578."
The foregoing holding was decisive in that case. The case ofBlackman v. Henderson, 116 Iowa 578, cited therein, involved real estate, and involved a construction of the statute pertaining to the recording of real estate instruments.
Bartlett v. Bolte, 193 Iowa 1063. In this case the plaintiff brought his action to foreclose a chattel mortgage, and named as defendants certain alleged subsequent purchasers of the property. *Page 40
The defendants challenged the validity of the mortgage, and the question of notice became thereby involved. The defendants also pleaded a waiver of the lien by the mortgagee. The plaintiff prevailed, and the defendants appealed. We said:
"The burden was upon appellants on this issue (Bensen Marxerv. Reger, 186 Iowa 19), and that they bought the property without notice of plaintiff's mortgage (Diemer v. Guernsey, 112 Iowa 393) ."
Some other cases may be considered. In Barrett v. Fisch,76 Iowa 553, the defendant set up a mortgage in defense to plaintiff's claim in replevin of a horse. The mortgage had been executed by the then owner of a horse at a time prior to the purchase of such horse by the plaintiff from such mortgagor. The defendant averred the recording of his mortgage, and charged the same as notice to the plaintiff. On the trial, the district court held that the mortgage was defective in description, and that its recording imparted no notice. On appeal here by the defendant, as appellant, he contended that the burden was upon the plaintiff to prove that he did not have notice of the mortgage at the time of his purchase of the property. In response to that contention, we said:
"The case was tried, however, upon the theory that defendant's right depended upon whether the record of the mortgage imparted constructive notice. He alleged that his mortgage was duly recorded before plaintiff's purchase; thus clearly indicating that he relied upon the record as notice of his interest. We think the court below was correct in the view that no issue as to actual notice was presented by the pleadings."
In Waterhouse v. Black, 87 Iowa 317, the plaintiff, as mortgagee, brought a suit to replevin the mortgaged property. He set forth his mortgage, and averred that it had been duly recorded. He did not allege actual notice to the defendant. It appeared upon the trial, however, that the acknowledgment was defective, and that the recording of the mortgage did not impart constructive notice. The defendant had pleaded in his answer that he had neither actual nor constructive notice. On that question, we said:
"The acknowledgment was not, however, essential to its validity; and it was effective, as between the parties to it, and as against all parties having notice of it. Morse v. Beale, 68 Iowa *Page 41
467; Lake v. Gray, 30 Iowa 416; Jones v. Berkshire, 15 Iowa 249. There was evidence which tended to show that Bell notified the defendant of the mortgage before the levies in question were made. The petition alleged that the mortgage was duly recorded, and did not charge that the defendant had actual notice of it when the levies were made. The answer alleged that the defendant did not have either actual or constructive notice of it when he made the levies, and that allegation was not denied by a reply. A reply was not necessary, however, as a denial was made by the law. The petition showed clearly that the plaintiff's right of recovery was founded on the mortgage. The defendant presented the question of notice by the affirmative allegations of his answer. Under these circumstances, there was no error in admitting the mortgage in evidence on the proof of actual notice of its existence given to the defendant before the levies were made."
In Orr v. Kenworthy, 143 Iowa 6, we said:
"But to entitle a creditor to protection under this statute, it must appear that he acquired a lien by attachment or execution levy or otherwise without notice of the sale or transfer. Murphyv. Murphy, 126 Iowa 57."
In Murphy v. Murphy Co., 126 Iowa 57 (page 64), we said:
"In this state an unrecorded chattel mortgage is valid save as against subsequent purchasers and existing creditors, without notice. Code, Section 2906. A creditor, existing as such at the time of the execution of the mortgage, must obtain a lien, as by attachment or otherwise, upon the mortgaged property, before notice, actual or constructive, of the mortgage, that he may avail himself of the benefit of the statute."
In Volume 1 of the official Annotations to the Code, under Section 10015, No. 63, many cases are cited to the following proposition:
"To entitle a creditor to protection against an unrecorded sale or mortgage, it must appear that he acquired a lien by attachment or execution levy, or otherwise, without actual or constructive notice of such sale or mortgage."
We will not pursue an examination or discussion of these several cases. Some of them are not closely in point. It will be seen from the foregoing that the consideration which we have *Page 42
heretofore given the question now before us has usually been quite incidental, and our pronouncement has been usually conformable to the state of the pleadings in the particular case. Our pronouncement in the cases of Diemer v. Guernsey, 112 Iowa 393, and Zacharia v. Cohen Co., 140 Iowa 682, is more nearly decisive of the actual point presented herein than any of the other cases cited. It devolves upon us now to meet the issue presented, and to determine definitely where the technical burden of pleading and proof lies.
The statutory section in question is in the nature of an exception. Without such section, an unrecorded mortgage would be as valid as a recorded one, as against all persons. It is so notwithstanding the statute, except as to "existing creditors or subsequent purchasers without notice." No one can challenge the validity of a mortgage for want of record, except the persons herein described. Where a purported subsequent purchaser asserts his right to mortgaged property, as against the mortgagee, it must appear, by allegation and proof, from one side or the other, that he was in fact a subsequent purchaser. Is the burden upon the mortgagee in the first instance to allege, and afterwards to prove, that the claimant is not a subsequent purchaser? Or is the burden to the contrary, upon the claimant himself? We think in such case that the claimant himself must allege such a status as brings him within the favor of the statute. If he allege and prove that he is a subsequent purchaser, may he rest at that point, and ignore the question of notice? The mere fact that he is a subsequent purchaser is not enough to give him a standing under the statute. He must be such "subsequent purchaser withoutnotice." If he is under the burden of alleging and proving his status in part, is he not under the same burden to allege and prove it completely? We can see no fair reason for saying that the burden is upon the claimant to prove that he is a subsequent purchaser, and yet upon the mortgagee to prove that he was not such "purchaser without notice." The question at this point is very narrow and essentially technical, and takes no account of a possible shifting of the burden in the progress of the evidence. The issue of fact thus tendered is one peculiarly within the knowledge of the claimant. He is permitted to meet his burden with his own evidence. He may rest upon it, if he so chooses. There is a sense in which the burden of overcoming his *Page 43
evidence shifts to the mortgagee. That, however, presents a question only of weight of evidence. It has no effect upon the burden of allegation in the pleading. The burden of allegation
never shifts; nor, therefore, does the burden of proof ever shift. The only legal requirement upon the "subsequent purchaser" is to make a prima-facie case. When he has done so, the mortgagee may combat it. Ordinarily, only affirmative evidence will avail him on the question of notice. In the progress of the evidence, the call to go forward often passes from one litigant to the other; but the call is for the weight of evidence. The contest is before the jury, where credibility is always a weight in the balances. We hold, therefore, that the burden of allegation is upon the "subsequent purchaser," and not upon the mortgagee.
The contrary argument is that the statute implies an obligation on the mortgagee to give notice of his mortgage. Such statute has provided a method of notice by public record. The recording is deemed a complete notice to everybody. Nevertheless, notice toeverybody is not essential to the validity of a mortgage. If its recording fails, it is still valid, except as to the persons described in the statute. These must disclose themselves as such, in order to challenge the validity of the mortgage. The mortgagee is not bound to challenge, by pleading, the validity of his own mortgage, nor to anticipate a challenge thereto by his adversary. Practical considerations often invite the mortgagee, in litigation, to plead his recording, and thereby to plead notice. He may thereby be deemed to tender the issue to his adversary, who may accept the same by a general denial. This means only that the mortgagee has thereby voluntarily assumed the burden, and has thereby offered a theory of the case of which he may not later complain. He has not thereby changed the law.
In the case at bar, the pleading of the mortgagee set up his mortgage. It contained no allegation on the question of notice. The demurrer was predicated upon such want of allegation as to notice. We hold that it was not demurrable upon such ground.
The order of the court sustaining the demurrer and dismissing the petition is, accordingly, reversed. — Reversed.
De GRAFF, MORLING, and KINDIG, JJ., concur. *Page 44
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The place where this crime is alleged to have been committed is somewhat remote from any city or town. There is a highway running north and south, and on the land adjoining this highway on the east is where it is said to have occurred.
The first seven errors assigned go to the question of the sufficiency of the testimony to support the verdict. The land where the crime was alleged to have been committed was owned by one Perigo. One Perkins, an employee of 1. INTOXICA- Perigo's, was engaged in mowing weeds on the TING land in August, 1928. It appears that at one LIQUORS: time, at a point on the land some 60 feet east criminal of the highway, there had been a barn, which had prosecu- been destroyed or removed, leaving a foundation tions: and some pieces of lumber lying in that nuisance: vicinity. Perkins, in pursuance of his evidence: employment, knowing of the existence of this sufficiency. lumber, stopped mowing, to avoid having his machinery come in contact therewith, and he there discovered, stowed away in this pile of lumber, six cans of alcohol. He did not remove them, but later in the day, advised his employer of his discovery. The latter then notified the sheriff, who sent deputies to the place, to watch the same. They did so continuously, and about midnight, on August 15th, the defendant drove north on this byroad for some distance, then reversed his direction, and stopped his car in front of the gate leading into this land on the east. He alighted from the car, carrying a flash light, which he used to guide him into the place. He followed the wagon track into the place, passed the south side of the barn, threw his light in the direction where the liquor was hidden, and moved forward, but did not get within 40 or 45 feet of the place where the liquor was stored. He then turned, and started back toward the car, whereupon the officers arrested him. Immediately thereafter, one of the officers asked him something about his presence there, and the liquor, and he said, "When I saw the weeds cut, I figured it went with the weeds." The witness further said: "I heard him [defendant] say, when he saw the tracks, he had a hunch not to go in." This witness testified that, on the road to Chariton, during a conversation between Shaffer (another witness) and the defendant, the defendant *Page 141
made the statement that, if Milthrope (another witness) said this liquor had been there for a long time, he (Milthrope) would not know good liquor when he saw it.
Defendant was then taken into Chariton, to the office of one Hickman, and the defendant said to Boyland, the deputy marshal, "Why didn't you tell me the law was out there, and I wouldn't have went out?" Boyland corroborates this latter statement, and other witnesses corroborate admission of these various statements by the defendant.
We have held that a weed or brush patch is a "place," within the meaning of the statute. State v. Cahalan, 204 Iowa 410. InState v. Friend, 206 Iowa 615, we held that the crime of maintaining a liquor nuisance does not necessarily include a sale of the liquor so kept, but does consist in maintaining a place where intoxicating liquors are kept for that purpose. Of course, like all other crimes, this one may be established by circumstantial evidence. State v. Carlson, 203 Iowa 90; State v.Hester, 205 Iowa 1047. A question very similar to this was passed upon by this court in State v. Japone, 202 Iowa 450.
Under the well established rules of this court, we are inclined to, and do, hold that the evidence in the case was sufficient to take it to the jury.
Appellant insists that, under the holding in State v.Albertson, 206 Iowa 39, this conviction cannot be sustained.
In the Albertson case, the charge was larceny, and the best the state could show was that the defendant was within 20 feet of the property which was alleged to be the subject of larceny. We there held that the evidence was not sufficient to sustain a conviction. But the facts in the case at bar go beyond the facts in the Albertson case, by showing the various admissions made by the defendant in relation to the liquor in question. As suggested, we think that these added facts make sufficient evidence to carry the case to the jury.
The case of State v. Friend, 207 Iowa 742, is relied upon by the appellant; but in that case the defendant resided with his mother, who was the owner of the property, or at least the head of the family, and controlled the household, and she testified that she was the owner of the liquor which was the subject of the charge. We held in that case that, under the record, the State had failed to prove that the liquor was in the possession of the *Page 142
defendant. The evidence in the case at bar shows, however, inferentially at least, that Perigo, the owner of the property here, was not the owner of this liquor. The Friend case does not go far enough to aid the defendant herein.
When the defendant was arrested, the liquor was brought to town by the officers and labeled, and was brought 2. INTOXICATING into court by the officers as evidence in the LIQUORS: case. The defendant questions the admissibility criminal of these exhibits; but, under the rule prose- heretofore announced by this court, they were cutions: properly admitted. evidence: liquors seized.
One of the strongest points urged by the defendant for reversal is that certain witnesses were asked as to the place of residence and the business of the defendant. This testimony as to the place of residence, while wholly immaterial, was 3. CRIMINAL nonprejudicial. A hotel keeper testifies that LAW: defendant had been rooming at his hotel for the evidence: first 15 days in August. He was then asked about materiality the business or employment in which the and defendant was engaged, and his answer was, "I competency: don't know." Again he answered, in response to residence a similar question, "I don't know what he was and doing." Another witness was asked the same occupation question, and his answer was, "None whatever of that I know of." This evidence could not be defendant. prejudicial, as the defendant might have been continuously employed in a legitimate business, and the witness not know anything about it. A third witness was asked the same question, and his answer was, "I don't know of any work that he did." What has just been said about the second witness is equally true as to the answer of the third witness. Under the circumstances, we do not feel that this evidence was prejudicial, even though it was held to be immaterial.
It is insisted that Instruction No. 7, taken in conjunction with Instructions 2 and 3, is contradictory and confusing to the jury, thereby resulting in prejudice to the defendant. We have read these instructions carefully, and do not find the conflict complained of. It is well settled that the court need not state all of the law in a single paragraph of the instructions. Statev. Reed, 205 Iowa 858.
An instruction on circumstantial evidence was given, which is attacked; but the instruction given is, in substance, identical *Page 143
with an instruction which was held good by this court in State v.Friend, supra.
Defendant asked for instructions which were refused, and rightfully so, because the subject-matter was covered by the instructions given by the court. See State v. Render, 203 Iowa 329.
Viewing the case as a whole, we think that the defendant had a fair and impartial trial, and that no errors were committed which were prejudicial to him. — Affirmed.
STEVENS, De GRAFF, MORLING, and KINDIG, JJ., concur.
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In August 1936, plaintiff, acting as attorney and trustee for bondholders, brought this suit for a writ of mandamus.
The following allegations appear in his amended and substituted petition: Prior to March 1, 1924, Chariton River Drainage District No. 1 was established. On or about March 1, 1924, the board of supervisors of Wayne county caused to be issued and *Page 311
sold drainage bonds which were numbered serially. In 1929 and 1930, the bondholders, represented by plaintiff, purchased bonds No. 64 to No. 74, inclusive, in the principal sum of $7,400 due November 1, 1934, without notice of any defect and before any default in the payment of interest. The original assessment was levied in February 1924. This assessment was insufficient to pay the cost of the project and on September 10, 1925, an additional assessment was made under the authority of section 7479. There was an error in computation in the first assessment and as a result of this error the amount of the assessment was about $6,000 less than the cost of the project and the amount of the bonds issued when the additional assessment was made in September 1925. The error in the first assessment and other miscalculations had not been discovered by the board and the aggregate amount of both assessments was less than the cost of the project and amount of all the bonds issued. At all times the aggregate amount of the bonds has exceeded the total amount of the assessments. There was no default in any installment of interest on said bonds until on or about November 1, 1933; upon such default, plaintiff promptly had an audit made of the books of the drainage district, discovered thereby the reasons for such default, made demand as alleged in plaintiff's amended and substituted petition, and thereafter, and within three (3) years of such default, brought this action for a writ of mandamus, to compel the necessary levy and assessment. The bonds provide that:
"It is Hereby Certified and Recited: That all acts, conditions, and things required to be done in locating and establishing said Drainage District, in the making and levying of said assessment against the lands and highways benefited thereby, and precedent to and in the issuing of this bond were and have been legally had, done, and performed; and that the total amount of bonds issued on account of said Drainage District does not now exceed the assessment so levied therefor, unpaid at the time said bonds are issued, nor any legal limitations thereon.
"For the Performance of all the covenants, recitals, and stipulations herein contained, and for the collection and application of the said assessments and of the interest thereon, and such other and further assessments authorized or required to provide *Page 312
for the prompt payment of this bond and interest hereon, the faith and resources of said County are hereby fully pledged."
The petition further alleged there was a continuing duty of the board of supervisors to make additional assessments necessary for full payment of the bonds. The bonds were presented for payment and payment refused. The assessments remaining unpaid, tax sale certificates and real estate owned by the district are not sufficient to pay the bonds owing to plaintiff. It is the duty of defendants to levy a sufficient assessment to pay the bonded indebtedness. Plaintiff requested and demanded defendants to levy and collect a sufficient assessment, as by law authorized and required, to pay the said bonded indebtedness, but defendants refused to make such additional levy.
The lands in the drainage district have never been assessed in an amount necessary to pay the bonds or the cost of the project.
[1] I. Ground 3 of the motion to dismiss reads:
"3. That the plaintiff is not entitled to the relief demanded for the reason that under the law the duty of the defendants herein to levy an additional assessment as prayed for in the plaintiff's amended and substituted petition and amendment thereto is not a mandatory duty but permissible only."
This ground has reference to Code section 7509, which reads:
"7509 Deficiency levy — additional bonds. If any levy of assessments is not sufficient to meet the interest and principal of outstanding bonds, additional assessments may be made on the same classification as the previous ones. Additional bond issues may be made when necessary to complete full payment for improvements, by the same proceedings as previous issues." (Italics supplied.)
Appellant's first assignment is that the court erred in holding that an additional levy under said section was permissive only and not mandatory. The question is whether the word "may" is permissive or mandatory. We hold the word "may" should be interpreted as "shall" and that the statute is mandatory. *Page 313
We are of the opinion that the policy and intention of the legislature is that (1) drainage bonds shall be payable solely from taxes assessed against the lands in the district and (2) that the board of supervisors shall make assessments sufficient to pay the cost of the project and all bonds issued. This policy is expressed in sections 7479, 7504, 7505, 7509 and other sections in chapter 353, 1935 Code, and also in chapter 358-F1 [chapter 358.2, Code, 1939].
Code section 7504 provides that a drainage bond shall be paid only from taxes levied and collected on the lands within the district.
Code section 7479 reads:
"7479 Levy for deficiency. If the first assessment made by the board for the original cost or for repairs of any improvement is insufficient, the board shall make an additional assessment and levy in the same ratio as the first for either purpose, payable at the next taxpaying period after such indebtedness is incurred subject, however, to the provisions of section 7484."
Code section 7505 provides that:
"In no case shall the aggregate amount of all bonds issued exceed the benefits assessed. Such bonds shall not be issued for a greater amount than the aggregate amount of assessments for the payment of which they are issued, * * *."
The above sections are, without question, mandatory.
Section 7505 states that drainage bonds shall not be issued for a greater amount than the aggregate amount of assessments. In order to insure compliance with this mandatory provision and the mandatory requirement in section 7504 that the bonds be paid solely from assessments on lands in the district, the legislature enacted section 7509 providing for a deficiency levy. Section 7509 states that if any levy of assessments is not sufficient to meet the interest and principal of outstanding bonds, additional assessments may (shall) be made on the same classification as the previous ones. Chapter 358-F1 [chapter 358.2, Code, 1939] provides proceedings for the levy of an additional assessment *Page 314
if the prior assessments are not sufficient to pay defaulted drainage bonds.
The legislature, recognizing the assessments were the sole source of payment of the cost of the project and drainage bonds, enacted section 7479 which requires an additional assessment if the first assessment is insufficient to pay the cost, and, to protect bondholders, enacted section 7509 which compels the board of supervisors to make additional assessments sufficient to pay maturing bonds.
The legislature was not satisfied to demand only that bonds must not be issued for a greater amount than the aggregate amount of assessments (section 7505). It also justly required that if the assessments made were not sufficient to pay maturing outstanding bonds a deficiency levy must be made by the board of supervisors (section 7509). We cannot accept the construction that the legislature, in adopting section 7509, entrusted the payment of the bonds to the caprice or discretion of the board.
In Kelley v. Cedar Falls, 123 Iowa 660, 661, 99 N.W. 556, 557, it is stated in a statute or ordinance the word "may" can be construed in a mandatory sense "`when such construction is necessary to give effect to the clear policy and intention of the Legislature; * * *.'"
In Downing v. City of Oskaloosa, 86 Iowa 352, 353, 53 N.W. 256, 257, the court said:
"`The word "may" in a statute is sometimes used in a mandatory, and sometimes in a directory and permissive, sense. It has always been construed to mean "must" or "shall," whenever it can be seen that the legislative intent was to impose a duty, and not simply a privilege or discretionary power, and where the public is interested, and the public or third person have a claim de jure
to have the power exercised. But it is only where it is necessary to give effect to the clear policy and intention of the legislature that it can be construed in a mandatory sense, * * *.'"
The following statement, which is unnecessary to the decision, appears in Western Bohemian Fraternal Association v. Barrett,223 Iowa 932, on page 935, 274 N.W. 55, 56: *Page 315
"Plaintiff urges that the section [7509] is mandatory, and that the word `may' should be interpreted as if the word `must' appeared, to effect the evident intent of the legislature that there be an additional levy under the circumstances shown by plaintiff. But it would appear to us that the language of section 7509 was used advisedly, and that the purpose was to afford the board of supervisors, or the trustees of a drainage district, a permissible procedure for remedying, if need be, a failure to carry out the mandatory provisions of the preceding section 7505. In event it is discovered that there has been a violation of the mandate found in section 7505, then section 7509 makes possible the levying of the necessary additional assessments."
We do not adopt the construction given section 7509 by the dictum in the Barrett case and hold that the section is mandatory.
[2] II. Ground 4 of the motion to dismiss is, in part, as follows:
"That the bonds involved in this action expressly provide as follows:
"`This bond is based upon and constitutes a lien upon and is payable solely out of the proceeds of the special assessments for benefits heretofore legally levied on the lands and highways benefited, and the said special assessments are hereby irrevocably pledged therefor.'
"That the contract set forth in said bonds having specifically stated that it was payable solely out of the proceeds of the special assessments for the benefits that were theretofore legally levied on the lands and highways benefited, the plaintiff is precluded from asking or demanding any further levy." (Italics supplied.)
Defendants stress the use of the word "heretofore" appearing in the bond.
This provision of the bond does not accurately conform to the provisions of section 7504 which requires a drainage bond to state that "it is to be paid only from taxes for levee and *Page 316
drainage improvement purposes levied and collected on the lands assessed for benefits within the district for which the bond is issued."
To sustain the ruling of the trial court, defendants state that sections 7479, 7505 and 7509 did not become effective until July 1, 1924, and the bonds were issued in March 1924. They contend that these statutes permitting additional assessments apply only to bonds issued after their enactment and the bonds in question were payable only from the original assessment. We are not in accord with this proposition.
Section 1989-a27, Code Supplement, 1913, in force when the bonds were issued, provides "in no case shall the amount of bonds exceed the benefits assessed" and "should the proceeds of the tax when collected be insufficient to pay the principal and interest of bonds sold, a new apportionment of the tax may be made and other bonds issued and sold in like manner, to meet such excess of cost or shortage in the proceeds of tax." Section 7479, which requires an additional assessment if the original assessment is insufficient to meet the cost, and section 7509, which requires an assessment sufficient to pay outstanding bonds, amended and clarified section 1989-a27, and are clearly retrospective, each section referring either to existing drainage bonds (7509) or prior assessments (7479). See also chapter 358-F1 [chapter 358.2, Code, 1939].
[3] III. Ground 4 of the motion to dismiss also states:
"The defendants further state that if the Board of Supervisors failed to levy a sufficient amount to pay said bonds, said failure on the part of said Board of Supervisors occurred more than ten years prior to the bringing of this action and therefore the plaintiff's cause of action is barred by the statute of limitations."
Section 11007, subsection 4, reads:
"4. Against sheriff or other public officer. Those against a sheriff or other public officer, growing out of a liability incurred by the doing of an act in an official capacity or by the *Page 317
omission of an official duty, including the nonpayment of money collected on execution, within three years, * * *."
This is not an action founded on written contracts (the bonds) the limitation on which is ten years under the provisions of section 11007, subsection 6. It is a suit against public officers growing out of the alleged omission of an official duty. Counsel refer to both limitations in argument. However, it is not material, for the purpose of this appeal, which statute was considered by the trial court because under defendants' theory the suit is barred under both limitations.
The contention of defendants is that appellant's cause of action accrued either in February 1924, when defendants omitted to perform their duty to levy an assessment sufficient to pay the cost of the improvement, or in September 1925, when the board in its second assessment made under section 7479 again failed to levy an assessment in a sufficient amount to pay the cost, at which time "the right accrued to the plaintiff to demand that sufficient assessments be levied with which to provide funds for the payment of the bonds." Defendants rely especially on Stockholders Investment Co. v. Town of Brooklyn, 216 Iowa 693, 246 N.W. 826, and Lenehan v. Drainage District, 219 Iowa 294, 258 N.W. 91.
In Stockholders Investment Co. v. Town of Brooklyn, supra, the town issued special assessment certificates for a street improvement. The action was for damages for breach of statutory duty. The provisions of chapter 353, relating to levee and drainage districts, were not before the court for consideration.
In the case of Lenehan v. Drainage District, supra, drainage warrants were issued to the contractors as evidence of indebtedness for the cost of the project. Plaintiff, owner of some of the warrants, brought an action in mandamus to compel defendants to levy an additional assessment under section 7479 in an amount sufficient to satisfy the unpaid warrants. Plaintiff did not assert any rights under section 7509. The petition alleged that the warrants were to be paid from assessments levied against the property over a period of ten years as provided by law, that the assessments were insufficient to pay the warrants, and that the board refused to levy on request an assessment to make up the *Page 318
deficiency. Defendants alleged in their amended answer that "the assessments levied over a period of ten years were for the payment of bonds issued and not for the payment of warrants; * * *" etc. Appellants filed a motion to dismiss the amendment. The court states:
"For the purposes of their motion to dismiss, the appellants must concede the truthfulness of the above-quoted allegations in the appellees' amended answer. Consequently, it is apparent, under the amendment mentioned, that there was no assessment at any time out of which to pay the warrants in question. Necessarily, then, the three-year statute of limitations lapsed more than three years before the institution of the action for mandamus. * * * When determining this case, we do not decide what might be the result had the action been on a drainage bond or other obligation deferring payment over a period of years. Our discussion is limited to the facts raised under the motion to dismiss."
In the Lenehan case, supra, no assessment had been made for the payment of the warrants. The payment of the warrants was not deferred as in drainage bonds and it was certain and definite long prior to the commencement of the action that no assessment had been made to pay the cost represented by the warrants and the court held that the case was barred by the statute of limitations, section 11007, subsection 4. The cited cases do not control the decision in this case.
In the instant case an assessment was made in an amount that would pay all but about $6,000 of the bonds issued. Appellant owned $7,400 of the bonds. In 1924 or 1925 appellant's bonds were not due. They were not due until 1934. All bonds were paid except the bonds of the appellant. The duty of the board, under section 7509, was to levy an assessment "to meet the interest and principal" of the unpaid bonds.
As stated in section 7504, the bonds were to be paid from taxes assessed on the lands in the district. The prior assessments were insufficient to pay these outstanding bonds when they matured. Appellant's right, under sections 7504 and 7509, was to have the bonds paid when they matured from assessments on the land. His right to a deficiency levy under section 7509, that is, his *Page 319
cause of action, accrued when the bonds matured in 1934. This action was commenced in 1936. The action is not barred by the statute of limitations.
[4] IV. Another ground of the motion to dismiss is:
"That the matters and things alleged in the amended and substituted petition are no different in effect than the allegations of the original petition and the first amendment thereto, and that said first petition and first amendment thereto were demurred by these defendants and submitted to this Court on the 21st day of August, 1937, which demurrer was sustained and not appealed from, and that said ruling was an adjudication in this cause and is now the law of this case."
Appellant excepted to the rulings on the first and second motions to dismiss.
We have repeatedly held that a ruling on a demurrer or a motion to dismiss does not become the law of the case. As stated in Hansen v. Independent School District, 193 Iowa 417, 422, 186 N.W. 922, 924, 21 A.L.R. 260:
"A ruling on a demurrer in and of itself settles nothing. It becomes an adjudication only if the defeated party chooses to make it such."
In Watkins v. Iowa Cent. Ry., 123 Iowa 390, 395, 98 N.W. 910, 912, this court said:
"If, after a ruling on a demurrer, a party excepting to that ruling pleads over a mere repetition of the matter theretofore stated in the pleading demurred to, he does not, of course, waive the error in the ruling on the demurrer. By so doing he manifestly does not intend to waive the error in the ruling on the demurrer, if any there be. * * * He either does not plead over by reasserting the same matters, or, if he does, such pleading should not be held to be a waiver of the ruling theretofore properly excepted to. Our rules of procedure are not intended as a trap to catch the unwary. Of course, if no exception is taken to the ruling on the demurrer, and the party whose pleading is attacked makes no exception thereto, but pleads over, and the demurring *Page 320
party moves to strike it, because a mere repetition, the only question then to be considered is the correctness of the ruling on the motion to strike. By failing to except to the ruling on the demurrer, the pleader accepts it as the law of the case, and the only ruling he challenges is the one on the motion to strike." See Back v. Back, 148 Iowa 223, 125 N.W. 1009, L.R.A. 1916C, 752, Ann. Cas. 1912B, 1025; Myers v. Wendel, 198 Iowa 859, 200 N.W. 431.
We have examined all of the grounds of the motion to dismiss the amended and substituted petition and conclude that none of them sustain the ruling of the trial court. The case is reversed and remanded for modification of decree in harmony with this opinion. — Reversed and remanded.
MILLER, SAGER, BLISS, and HALE, JJ., concur.
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I. In attempting to determine the correctness of certain instructions with reference to the pleadings, we have had much trouble in this case. After plaintiff filed his petition, a motion was made to strike from the pleadings, by simply referring to certain lines on certain pages thereof. Such motions *Page 115
do not enlighten us very much here, for, when these pleadings appear in the printed abstract, the lines and pages do not correspond to the pages and lines of the original pleadings; hence it is impracticable, if not impossible, to apply motions or amendments so made to the pleadings as they appear in the printed abstract.
This automobile collision occurred about 11 o'clock on the night of September 29, 1925. Jackson Street in the city of Dubuque runs north and south, and is intersected by Thirty-second Street, running east and west, both streets being paved. From this intersection eastward on Thirty-second Street, about two blocks, is a viaduct over the railroad track. There appear to have been no houses on Thirty-second Street between Jackson Street and the viaduct. At the southeast corner of this intersection are billboards, on the south side of Thirty-second Street and the east side of Jackson Street, making an angle at the corner. These boards are about 50 feet long and 10 or 12 feet high. At the northwest corner of this intersection is the Brunswick Hotel, a three-story brick building, flush with the lot lines on Jackson and Thirty-second Streets.
At the time in controversy, Judd, the plaintiff, was driving a Ford touring car. On his way home, he had picked up as guests Gladys Droullard and Mark Gavin, who occupied the rear seat. He drove north on Jackson Street, and started through this intersection. At about the time or shortly after he passed the middle line of Thirty-second Street, he was struck by the cars of the two defendants. Rudolph, who was driving a Ford sedan, was coming from the east, and his car struck the Judd car about the rear wheel and fender, and the impact swung the rear of the Judd car to the west, so that it was headed in a northeasterly or easterly direction; and while in that position, it was struck by the Casey car, the occupants thrown out, and the Judd car pushed or rolled over until it struck the curb and landed against the east side of the brick building above referred to. There was evidence from which the jury might find that both Casey and Rudolph were driving at an excessive rate of speed, and did not have their cars under control, and that the cars were about one half to a car length apart.
The first question argued for reversal has to do with the admission of testimony. The Rudolph car had four passengers, and the Casey car two. Most, if not all, of these parties testified *Page 116
in the case, and on cross-examination, some of them, if not all, were asked about where they came from and how far they had traveled, and as to the relative position of the Casey and the Rudolph cars in coming the distance they had. This testimony, of course, was not very material; but, at the same time, there was nothing prejudicial in it, and there was no error in the court's permitting this cross-examination.
Again, plaintiff testified that his car was struck by the Rudolph car, "and headed me right into the Casey car." It is claimed that this is a conclusion. It is, but 1. EVIDENCE: it is one of those conclusions of fact which a opinion witness is permitted to give. Plaintiff also evidence: testified, over objection, that he was not able allowable to work, and suffered pain after the accident. conclusion. We see nothing wrong in permitting him to so testify.
A physician who attended him was questioned as to whether or not these pains were the result of the injury referred to, and he said that the pains might have varied, or the causes might have arisen, or the injury might leave a "hangover," such as complained of, and that the "hangover" might continue an indefinite length of time. We are unable to see how the defendant was injured by this testimony. The case of Phillips v. Leuth,200 Iowa 272, does not sustain appellant's objection, as the facts there are wholly different. See Greenway v. Taylor County,144 Iowa 332; Bird v. Hart-Parr Co., 165 Iowa 542; Brier v. Chicago,R.I. P.R. Co., 183 Iowa 1212.
After a proper showing of the existing conditions, witnesses 2. EVIDENCE: who are properly qualified should be permitted opinion to testify as to the distance in which a given evidence: car can be stopped. Judd was permitted to distance testify concerning the speed of the Rudolph and in which Casey cars as they approached his car. He car can be showed himself properly qualified, and his stopped. answers were admissible.
Plaintiff testified that Gavin and Gladys Droullard, who were 3. EVIDENCE: with him, were thrown from the car, and that relevancy Miss Droullard struck the brick building, near and a window in the second story, and fell to the materiality: sidewalk, where she was picked up and carried gruesome into the hotel. Other witnesses testified to recital. these same facts. The contention of the appellant is that none of this testimony was *Page 117
admissible. With this we do not agree. The jury was entitled to a picture of the situation as it existed at the time of and shortly after the accident. Just where these parties were found as a result of the accident was all a part of the same transaction, and if for no other reason, it might be considered in determining the speed of the cars. One witness testified that the girl was found on the sidewalk at the east side of the hotel, and "she was in a huddled-up position." This was also admissible, as it was all related to and connected with the transaction.
Certain witnesses on cross-examination were asked whether or not, in the trial of State v. Rudolph, for 4. WITNESSES: manslaughter, they had not given testimony impeach- conflicting with that given by them on the ment: witness stand in the instant case, and the shorthand shorthand reporter was called, with his minutes, notes. to prove statements these witnesses had made on the former trial. This is permissible, and no legal objection can be made thereto.
We have given attention to the other assignments of error in regard to the admissibility of testimony, and find nothing that could be the basis of reversible error.
II. Serious assaults are made on certain of the instructions, among which is an attack on Instruction No. 18, 5. MOTOR reading in part as follows: "You are instructed VEHICLES: that all persons have an equal right to use the use of highways of this state in an equal manner." No highway: reference whatever is made in the instructions equal right to the section of the statute about to be to use. quoted, and such failure was excepted to and assigned as error.
This statement of the law contained in the above instruction may be accurate, as an abstract proposition, but in the instant case, recognition should be given to the provisions of Section 5035, Code of 1924, reading as follows:
"Where two vehicles are approaching on any public street or highway so that their paths will intersect and there is danger of collision, the vehicle approaching the other from the right shall have the right of way * * *."
A reading of this section shows the error in the instruction, as applied to the facts of this case, for the instruction wholly ignores the fact that, under this section, and under the evidence, *Page 118
the jury could find that the Casey and Rudolph cars had the right of way over the Judd car. See Switzer v. Baker, 178 Iowa 1063;Rolfs v. Mullins, 179 Iowa 1223.
The plaintiff's cause of action with reference to the Casey and Rudolph cars, as stated by him in the amended and substituted petition, is that "each of said automobiles driven by the defendants Rudolph and Casey was being driven at 6. MOTOR a high, dangerous, and excessive rate of speed, VEHICLE: to wit, in excess of 35 miles an hour, and that operation: both of said automobiles driven by said negligence: defendants ran into and against plaintiff's proximate: automobile, damaging and injuring the and plaintiff," etc. An attack is made on the concurring instructions given, because it is claimed that cause. Rudolph was liable only for the damages done by his car in striking the Judd car, and that he was not liable for the damage to the Judd car and the occupants by reason of its having been subsequently struck by the Casey car.
Turning now to the instructions, we find them to have followed the allegations of the plaintiff's petition: that is to say, the court charges that, for plaintiff to recover, both Casey and Rudolph must have been negligent. He then says:
"If you fail to find that any one of the items of negligence referred to in the last preceding instruction has been established by a fair preponderance of the evidence in this case, then it will be your duty to find your verdict in favor of thedefendants; or, if you fail to find from a fair preponderance of the evidence that the collision and damage resulting therefrom, if any, was a direct result of the negligence of the defendants H.A. Rudolph and Howard Casey, if any, then and in such event, it will be your duty to find your verdict in favor of the defendants."
Under the last part of the instruction quoted, the effect is to tell the jury that, before recovery can be had, the damage to plaintiff must be the direct result of the negligence of both Rudolph and Casey, and if the plaintiff fails to establish this, then the verdict should be in favor of the defendants.
It is around this question that the larger battle in this case rages. To put the matter simply, Rudolph contends that he is liable only for the damage done by his car, and not for the *Page 119
damage done by the Casey car. In the case of Rice v. Whitly,115 Iowa 748, at 750, we laid down this rule:
"If defendant's original and continuing wrong operated proximately in producing the damage, they are liable, even though there was another concurring cause operating at the same time to bring about the result," — citing Gould v. Schermer, 101 Iowa 582.
In the Gould case we said:
"[It] is well settled that the mere fact that some other cause operates with the negligence of the defendant to produce the injury, does not relieve the defendant from liability. His original wrong, concurring with some other cause, and both operating proximately at the same time in producing the injury, makes him liable, whether the other cause was one for which the defendant was responsible or not," — citing several Iowa cases.
This doctrine is substantially followed in Pratt v. Chicago,R.I. P.R. Co., 107 Iowa 287; Walrod v. Webster County, 110 Iowa 349; Harvey v. City of Clarinda, 111 Iowa 528; Burk v. CreameryPkg. Mfg. Co., 126 Iowa 730; McGee v. Jones County, 161 Iowa 296;Daggy v. Miller, 180 Iowa 1146; Sell v. Chicago, R.I. P.R. Co.,199 Iowa 808.
Again, where several proximate causes contribute to an accident, and each is a sufficient cause, without the operation of which the accident would not have occurred, it may be attributed to all or any of the causes, but it cannot be attributed to the cause unless, without its operation, the accident would not have happened. Burk v. Creamery Pkg. Mfg. Co.,
supra; Madden v. Saylor Coal Co., 133 Iowa 699.
In the case of Fitzgerald v. Des Moines City R. Co., 201 Iowa 1302, we had a very similar question. In that case, a passenger on a street car stepped from the car, and was struck by an automobile. His claim was that the street car company was negligent in permitting him to alight before the car stopped, and that by reason thereof he had a momentum which caused him to stumble and stagger toward the curb, and while in this condition, he was struck by an automobile. The defendant in that case contended that it was not liable, and that the injury was due wholly to an independent cause, — to wit, to the fact *Page 120
that the appellant was struck by an automobile. The conclusion of the court was stated as follows:
"In this particular case, three inquiries present themselves for consideration: First, was appellant injured solely by reason of the claimed negligence of appellee in the manner in which the street car was operated at the time appellant alighted therefrom; or, to put it another way, was appellant injured solely by reason of the momentum given his body as he moved from the street car, so that, for this cause, and it alone, he fell to the pavement and received the injury complained of? Second, was the sole cause of the injury to appellant the coming in contact with the automobile? Third, did the movement of the street car at the time appellant alighted concur with the action of the automobile in causing the injury to appellant; or, in other words, did his stumbling and staggering, caused by the movement of the street car, together with the impact of the automobile, concur and contribute together to produce the resulting injury?"
In that case, as well as the case under consideration, if the railway company or Rudolph was not negligent, there would be no liability, in so far as each was concerned; but if, in this case, Rudolph was negligent, and thereby placed Judd and his car in such a position that they were struck by the Casey car, and the Judd car would not have been struck by the Casey car, had it not been for the negligent act of Rudolph, then Rudolph would be liable for the injuries of which the plaintiff complains. In other words, so far as Rudolph's liability is concerned, under the facts in this case, the question of whether or not Casey was negligent is only a side issue, and not material to plaintiff's recovery against Rudolph.
In the instructions above set out, the court told the jury that, before plaintiff could recover, Rudolph 7. APPEAL and Casey must both be negligent, and their AND ERROR: negligence must be the direct cause of the harmless injury complained of. We do not think this is a error: correct statement of the law, but we are unable error in to see why Rudolph can complain about the same, favor of because the error in the instruction redounded com- to his benefit. In other words, the instruction plainant. told the jury that they must not only find that Rudolph was negligent, but that Casey also was negligent, and if they did not so *Page 121
find, their verdict should be in favor of both defendants. Under this instruction, Rudolph might have been ever so negligent, and yet, if the jury did not find that Casey also was negligent, they were told to return a verdict in favor of both defendants. With this situation, we do not see how Rudolph can complain about these instructions.
III. Complaint is made about certain statements made by counsel for the plaintiff in addressing the jury, and it is urged that, while the court told the attorneys to keep within the record, he did not tell the jury to disregard the statements about which complaint is made. While the court should have done so, the chances are that this question will not arise on a retrial of the case. Also, on a retrial of the case, it might be well for the court to give a specific instruction on the proposition that, if the jury found that Rudolph was not negligent, as alleged by plaintiff, then he would not be liable. We think this is fairly covered by the instructions given, but it might be well to make it specific.
The errors pointed out are prejudicial. — Reversed.
STEVENS, C.J., and MORLING and WAGNER, JJ., concur.
De GRAFF, J., concurs in result.
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A county attorney's information accused the defendant that he did willfully and unlawfully engage in the practice of medicine, in that he "did publicly profess and represent himself to be a physician and to assume the duties incident to the practice of medicine, and did then and there unlawfully and willfully profess to treat, heal, and cure diseases of the human body, and did then and there unlawfully and willfully prescribe, furnish, and administer medicine for human ailments, and did then and there unlawfully and willfully treat and attempt to heal and cure diseases of the human body," without first having obtained a license or certificate authorizing him "to engage in the practice of medicine."
The Medical Practice Act of this state has had the consideration of this court in divers cases. 1. PHYSICIANS State v. Heath, 125 Iowa 585; State v. Wilhite,
AND 132 Iowa 226. Sufficient to state that it has SURGEONS: been quite universally held that statutes regulation: regulating the practice of medicine and surgery constitu- are a proper exercise of police power. State ex
tionality. rel. Powell v. State Medical Exam. Board,32 Minn. 324; Musser's *Page 134 Exr. v. Chase, 29 Ohio St. 577; Wert v. Clutter, 37 Ohio St. 347, 348; Nelson v. Harrington, 72 Wis. 591; State v. Carey, 4 Wn. 424, 429; State v. Buswell, 40 Neb. 158; People v. Phippin,70 Mich. 6.
Free trade in physic no longer prevails, although, under the early common-law rule, any person undertaking to treat the sick in the exercise of his vocation was legally a physician; but, as a matter of history, Parliament, in 1422, enacted a statute regulating the practice of medicine and surgery, and confined it to those who had studied the subject in a university, and who were bachelors of science.
In Iowa, a person is deemed to be engaged in the practice of 2. PHYSICIANS medicine and surgery who (1) publicly professes AND to be a physician or surgeon, or (2) publicly SURGEONS: professes to assume the duties incident to the practicing practice of medicine or surgery, or (3) without prescribes and furnishes medicine for human authority: ailments or treats the same by surgery. Section -evidence. 2538, Code of 1924.
The evidence in the instant case is replete with facts affirmatively showing that the defendant violated the prohibitions of the Medical Practice Act. It is conceded of record that he was not a licensed physician. It may be that the defendant is not in the class of the learned "Doctour of Phisike" in the Canterbury Tales of Chaucer, wherein we read:
"He knew the cause of every maladie, Were it of cold or hote or moist or drie, And when engendred and of what humour. He was a veray parfite practisour."
He had patients, and treated them and prescribed for them. In one instance, he gave a woman a physical examination, to determine the condition of her ovaries, and after the examination, pronounced her ovaries all right. This person submitted to the examination on the belief that the defendant was a doctor. He used a violet-ray machine. He prescribed, for one patient suffering from alleged female trouble, an antiseptic salve containing chemicals, medicine, and pharmaceutical preparations, which salve bore the trade-mark "Franze."
It is quite apparent that the acts of this defendant were within the prohibition of the criminal statute. *Page 135
We now turn to the appellant's contentions which have to do with legal propositions. Before plea, the defendant filed motions to set aside the order of the trial judge 3. INDICTMENT approving the county attorney's information, and AND to set aside the information. Both motions were INFORMATION: based primarily on the ground that "no minutes minutes of of any evidence signed by any witness and sworn testimony: to by any witness were returned with the sufficiency. information." The trial court overruled the motions, and properly so. Under the statute governing a county attorney's information, the county attorney, at the time of filing such information, shall indorse or cause to be indorsed thereon the names of the witnesses whose evidence he expects to introduce and use on the trial, and shall also file with such information a minute of the evidence of each witness whose name is indorsed upon the information. Section 13647, Code of 1924. The information shall be sworn to by the county attorney. Section 13649, Code of 1924. Thereupon, the information, before being filed, shall be presented to some judge of the district court of the county having jurisdiction of the offense, which judge shall indorse his approval or disapproval thereon. If approved, the information shall be filed. Section 13650, Code of 1924.
It is idle to contend that the foregoing provisions were not respected in the instant case. The statute does not require that the county attorney shall attach copies of "sworn minutes" of the evidence to the information. Even as to indictments the statutory provisions in these particulars are directory. See State v.O'Malley, 132 Iowa 696; State v. Ottley, 147 Iowa 329.
It is further contended by appellant that the trial court erred in defining the word "prescribe," in one of the given instructions, which reads:
"`Prescribe,' as the word is used in the law, means designation of a remedy for an ailment or disease after having, by investigation, observation, or inquiry, ascertained the apparent nature thereof."
We discover no basis for the criticism. According to the 4. PHYSICIANS lexicographer, "to prescribe," in a medical AND sense, means "to direct, designate, or order the SURGEONS: use of as a remedy; as, the doctor prescribed
practicing quinine." Webster's New International
without Dictionary. In State v. Lawson, 6 Pennewill authority. (Del.) 395 (69 A. 1066) the court said: *Page 136
"In medicine, to `prescribe' remedies is defined to be `to write or to give medical directions; to indicate remedies.'"
In the case at bar, it is quite apparent that the defendant was catering to the patronage of certain persons who believed they were suffering "from the ills which flesh is heir to," and by his conduct and conversation assured them of his ability to help them, and, in fact, tried to do so. See State v. Bresee, 137 Iowa 673.
Lastly, it is urged by appellant that this action cannot be instituted except at the instance of the state department of health. There is no merit in the claim. The 5. PHYSICIANS defendant was accused of an indictable offense. AND It is the function of the grand jury to inquire SURGEONS: into all indictable offenses triable within the practicing county and present them to the court by without a indictment. Section 13702, Code of 1924. license: Furthermore, the county attorney may, at any right to time when the grand jury is not actually in institute session, file in the district court, either in prosecution. term or in vacation, an information charging a person with an indictable offense. Section 13645, Code of 1924. It is true that the state department of health is enjoined to enforce the provisions of the act in question, but the legislature never intended the power conferred upon the state department of health to be exclusive or to supplant the provisions of the penal code. Here we are concerned only with the provisions of the criminal statute. We are dealing with an alleged criminal act. At most, the legislative intent in conferring a power on the state department of health is to supplement the power of the grand jury or county attorney in such matters, and not to supplant local jurisdiction in the premises.
The propositions relied upon for a reversal are not well predicated. The judgment entered is — Affirmed.
EVANS, C.J., and STEVENS, ALBERT, and MORLING, JJ., concur.
WAGNER, J., not participating. *Page 137
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One Hiram A. White, during his later years, was a member of the Iowa Soldiers' Home, located at Marshalltown, Iowa. On April 25, 1922, he went to the office of Colonel John C. Loper, adjutant at said Home, and stated, in substance, to Colonel Loper that he (White) wanted to make some kind of a statement, "so we would know what to do with his property, if he [White] passed away;" or, to phrase the statement of White in another form, according to the testimony of Colonel Loper, he "said he [White] wanted, if he died, to make some kind of disposition of his property, — his money." Thereupon Colonel Loper went with Mr. White to the office of Isabella Sellers, stenographer at said Home, and the document herein set out was dictated, the colonel stating that the initial sentence and the rest were "in Mr. White's exact language." After the document was typewritten by the stenographer, it was signed by Hiram A. White, and witnessed then and there by Isabella *Page 1211
Sellers and John C. Loper. The document, as signed and witnessed reads as follows:
"April 25, 1922.
"B.C. Whitehill, Commandant.
"In case of my death you are directed to ship my remains to Ed Link, Muscatine, Iowa, who will look after the burial and all business that I have unfinished. You are hereby directed to pay to the said Ed Link all the money that I may have in deposit in the Iowa Soldiers' Home. The Fidelity Savings Bank of Marshalltown, Iowa, is hereby directed to pay to the said Ed Link all the money I may have on deposit with the said Fidelity Savings Bank of this city.
"Hiram A. White.
" Witnesses
"Isabella Sellers
"Jno. C. Loper."
There is but one question on this appeal: Was the instrument tendered as a will in fact testamentary? The proponent's propositions are that the said document (1) was testamentary in character, (2) took immediate effect upon the death of the maker, (3) was ambulatory in character and revocable at pleasure, and (4) did not pass an interest in praesenti. The contestants contend to the contrary on each of these propositions. We therefore have a question of the construction of the language used by the creator of the document, viewed, if necessary, in the light of the circumstances surrounding the execution of said document. No question as to the mental condition of Hiram A. White, undue influence, or the legal requisites in the making of the will, is involved. In brief, all matters are eliminated except the character of the document before us.
Hiram A. White departed this life February 13, 1928. The document was filed in the office of the clerk of the district court of Iowa in and for Marshall County, February 20, 1928. It was filed as the last will and testament of Hiram A. White, and was admitted to probate March 17, 1928. Petition to set aside will and probate was filed by the contestants on May 12, 1928, and the contest came on for hearing April 1, 1929. Upon the close of all the evidence, and after motions for directed verdict were made respectively by the contestants and the proponent, the *Page 1212
trial court sustained the proponent's motion, and verdict was returned for the proponent. Judgment was entered accordingly, and this appeal was taken.
The law is quite definitive in distinguishing a testamentary document from one nontestamentary in character. This is clearly shown, not only by our standard textbooks, but also by the decisions of our courts of last resort. The test is well stated in 1 Alexander's Commentaries on Wills 50, Section 46:
"In cases where doubt arises as to whether the instrument is a will or of some other character, the true test is whether the maker executed the document with animus testandi. To be a will, the maker must have intended to pass his property only after his death, and to pass it by the particular instrument in question, although he may have designated it by a different name, and, through ignorance of the law, may not, in fact, have known that he was making a will. The test of the character of the instrument is the intention of the maker at the time of its execution, and a construction of the document must be based upon its provisions."
The cardinal rule in the construction and interpretation of wills is that the intention of the testator must be ascertained, if possible, and, if it is not in contravention of some established rule of law or public policy, must be given effect; and by this is meant the actual, personal, individual intention, and not a mere presumptive intention, inferred from the use of a set phrase or a particular form of words. See Thompson on Construction of Wills (1928) 58 et seq., Section 45; BurlingtonUniversity v. Barrett, 22 Iowa 60; Flynn v. Holman, 119 Iowa 731;In re Estate of Longer, 108 Iowa 34; In re Estate of Mount,189 Iowa 279; In re Estate of Ullrich, 189 Iowa 868. For further discussion and citations of our own decisions in cases involving the testamentary character of a document, see Hall v. Hall,206 Iowa 1.
As a matter of further preliminary statement of legal principle it may be said that there is no fixed form to express the animustestandi, but the true and actual meaning of the testator will be allowed to prevail if, in view of the instrument as a whole and the circumstances attending its making, such intent is fairly shown. Hiller v. Herrick, 189 Iowa 668. The true object *Page 1213
of testamentary interpretation is to ascertain, if possible, the purpose of the testator, and when it is ascertained, to give it effect, if this can be done without violating any settled rule of law. In re Estate of Clifton, 207 Iowa 71. If possible, every clause and word in a will should be given meaning, and the duty of the court is to determine what the real desire and intention of the testator were. When this intention is found, it is absolutely controlling. In re Estate of Dodge, 207 Iowa 374.
In the case at bar, there is no occasion to invoke the rule of extrinsic evidence in respect to written instruments. There is no condition annexed to the instrument in question. It cannot be challenged by reason of its legal form. Its very language discloses that the writing was testamentary in character. The initial words are: "In case of my death." The instrument, read as a whole, discloses that the language is couched in futuro. The maker of this instrument did not contemplate the passing of titlein praesenti, since the instrument does not say, "All the money that I now have," but, "all the money that I may have" on deposit in two different places (named in the instrument) shall pass to the beneficiary Ed Link "in case of my death." The animustestandi stands out boldly, and we discover no room for doubt that the paper was properly admitted to probate as the last will and testament of Hiram A. White. As said in In re Estate ofLonger, supra:
"When the animus testandi is established, the character of the instrument is fixed. It is a will."
The polestar in the testamentary heaven of this case is visible without the aid of a legal telescope.
The judgment entered by the trial court is — Affirmed.
MORLING, C.J., and STEVENS, ALBERT, and WAGNER, JJ., concur. *Page 1214
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The petition filed by the plaintiff in the district court avers that she is the owner of seven unimproved lots in certain blocks in the city of Independence, of the value of $60 each, which were assessed in amounts ranging from $47 to $108, respectively, and that such assessments were in excess of 25 per cent of the value of the lots, respectively.
Though it is not alleged in the petition, we infer from the briefs that, at some time prior to January 21, 1924, the city council had caused to be placed on file a plat of proposed assessments for the cost of a sewer, and had published notice accordingly, and that plaintiff's action on January 21, 1924, was in response to such published notice. On such date she filed with the city clerk a paper, in the following terms:
"I hereby file objections to assessments on unimproved lots, in Block 35 and 34 for sanitary sewer.
"L. Downing "Emma Skinner Downing."
What action was had by the city council subsequent to the filing of such objections, and before January 26, 1924, does not appear in the record before us. On January 26, 1924, "the plaintiff duly served notice of appeal from said assessment." The quoted words are from the abstract. The question argued in appellant's brief is whether the paper filed by the plaintiff with the city clerk was a sufficient compliance with the statute, Sections 6029 and 6030, Code of 1924, to entitle her to appeal from the action of the city council on the question of valuation of the lots and of the excessive character of the assessment, as exceeding 25 per cent of such values. The district court held that it was not, and we think its holding must be sustained. We are not disposed to construe these sections of the statute too strictly or technically. We should be disposed to hold that they permit great liberty of informality, and that any writing which fairly brings to the attention of the city council the nature of the taxpayer's complaint, in a form sufficiently definite to enable the city council to investigate such particular *Page 218
complaint, should be deemed sufficient. But even such a construction could not aid the plaintiff herein. Her paper neither directly nor indirectly directed the attention of the council to any ground of objection. She gave no reason for her complaint. She said simply, "I object." Whether she could have cured the defects by appearing in person on the return day and elaborating them orally or otherwise, we need not consider. We hold now only that the paper filed by her brought nothing before the city council upon which it could act intelligently. Andre v.City of Burlington, 141 Iowa 65; Koontz v. City of Centerville,161 Iowa 627.
It may be added, also, that the record before us seems to be defective. The petition discloses no action by the city council prior to February 13, 1924. Her appeal to the district court was taken on January 26, 1924. The record discloses no action by the city council between January 21, 1924, the date of the filing of the objection, and January 26, 1924. Whatever was done by the city council on February 13, 1924, could hardly be the subject of an appeal taken January 26th. This discrepancy of dates may have resulted from bad proof reading. If so, it is no less fatal to the record here. It is as much the duty of parties in this court to correct bad proof reading as it is to present to the printer a correct manuscript.
The judgment of the district court must be affirmed. —Affirmed.
STEVENS, FAVILLE, and VERMILION, JJ., concur.
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Deemer, J. — The lot in controversy was sold for the delinquent taxes of the years 1876, 1877 and 1878, at the regular tax sale held in November of the year 1879, to the plaintiff. Thereafter and on June 14, 1888, a tax deed for said lot issued to the plaintiff pursuant to said sale. Defendant Alwilda Bolt claims to have acquired title to the said lot through a deed from one Honeyman, which deed was never recorded and, it is claimed, was *Page 3
lost many years ago. Pursuant to said deed, defendant took immediate possession of the premises and occupied the same with her husband as a homestead down to the year 1893, when her said husband died. She continued in the occupancy of the premises from the time of her husband's death, claiming to own the same, until the commencement of this action. During her occupancy she improved the premises, expending at least $600 in betterments thereon. These improvements were commenced in the year 1882, and were continued down to near the time of the commencement of this action. She knew nothing of the tax sale of the premises, and always claimed to the assessor since the death of her husband that the property was exempt from taxation, because she was a soldier's widow and did not think the property was subject to taxation. The assessors informed her that the property was exempt to her as such and upon this she relied. Whether or not taxes were levied and assessed against the property for the years 1879 to 1889, inclusive, and, if so, by whom paid does not appear. Plaintiff, however, did pay taxes upon said property from the year 1889 to 1900. Neglecting to pay thereafter, the property was again sold for taxes in the year 1900 to one P.W. Richards. On January 20, 1908, Richards gave notice to the defendant Alwilda Bolt of his purchase, and that the right of redemption would expire within ninety days from the date of the service thereof. Upon receipt of this notice, defendant Bolt redeemed the property from the tax sale by paying the amount necessary to effectuate the same to the county auditor. No deed was issued pursuant to this second sale, but Richards assigned his certificate of sale to the plaintiff in this suit. This was done after defendant had deposited the money for redemption with the county auditor. Plaintiff never gave the defendant any notice that he was claiming title to the lot, and, although he lived within but a few blocks from *Page 4
the premises, never made any claim thereto, and when notified that certain sidewalks should be constructed or repaired he directed the officer to the defendant Bolt, asserting that he had nothing to do with the property, and that notice should be given to the defendant Mrs. Bolt. This was before the time that Richards served his notice of redemption. Plaintiff claims, however, that he had an arrangement with plaintiff's husband during his lifetime, whereby the said husband was to work out the amount of the taxes paid by plaintiff, with interest and costs, and that when this was done he would deed the property to the said husband. That such agreement was made with the husband is satisfactorily established, and plaintiff also shows, or attempts to show, the number of hours worked by the said husband pursuant to this agreement. Plaintiff asks that in the event his title under his tax deed be not established, he have a decree for the amount of the taxes paid by him, with interest and costs, after deducting the value of the labor performed by defendant's husband before his death, amounting, as we understand it, to the sum of approximately $100. The defendant, whilst not denying this agreement, pleads that her husband had no authority to make it for her or on her behalf, and that in any event plaintiff's right to recover for the taxes paid by him is barred by the statute of limitations. In response to this plaintiff asserts that defendant's possession and occupancy of the premises has always been permissive, that her title is not adverse, and that she is in no position to challenge the tax deed, because she has not shown any title to the lot.
Code 1897, section 1445, provided: "No person shall be permitted to question the title acquired by a treasurer's deed without first showing that he, or the person under whom 1. TAX DEEDS: he claims title, had title to the property at the limitations: time of sale, or that the title was obtained from title. the United *Page 5
States or this state after sale." Under this section it has repeatedly been held that proof of title is a condition precedent to the right of a party litigant to take advantage of what is known as the five year limitation statute, with reference to tax deeds. This latter statute, being section 1448 of the Code of 1897, reads as follows: "No action for the recovery of real estate sold for the nonpayment of taxes shall be brought after five years from the execution and recording of the treasurer's deed, unless the owner is, at the time of the sale, a minor, insane person or convict in the penitentiary in which case such action must be brought within five years after such disability is removed." But the title therein referred to need not be a record or patent title. If the party attacking the deed has title by adverse possession, this may be shown to defeat an action for the recovery of real property based upon a tax deed. Shelly v.Smith, 97 Iowa, 259; Roth v. Munzenmaier, 118 Iowa, 326;Clark v. Sexton, 122 Iowa, 312; Chandler v. Keeler,46 Iowa, 596.
That defendant Alwilda Bolt has been in the peaceable, uninterrupted and hostile possession of the property since the time she claims to have received the deed therefor from Honeyman 2. SAME: homestead: is conclusively established by the unauthorized evidence. That the property was the acts of husband: homestead of husband and wife and so adverse possession continued after the death of the husband of wife. is clearly shown, and there is no testimony that the wife had any notice or knowledge of the husband's agreement to repay to plaintiff the amount of taxes paid by him, with interest and costs, after deducting the value of the labor performed by him for the plaintiff. Under the record he surely had no right to in any manner incumber the homestead without his wife's joining him in such agreement. Indeed, plaintiff claims nothing under this agreement, save the right to be reimbursed for the taxes paid by him after giving credits for labor performed. This *Page 6
agreement was not made for or on behalf of the defendant Alwilda Bolt and it is not shown that she had any knowledge thereof. It was not therefore binding upon her and the only remaining question is, is plaintiff entitled to a decree for the amount of taxes paid by him, either in virtue of this agreement or because of the equities of the case? That the agreement was not binding upon the wife needs no argument. But see Beedle v. Cowley,85 Iowa, 540, and cases cited therein.
Defendant Alwilda Bolt was in possession of the homestead under an independent right, and not subject to the control of her husband. This right could not be taken away from her by any unauthorized act of her husband, and, as she was in legal possession of the homestead when the five year limitation hitherto referred to expired, all rights under the tax deed were extinguished, so that plaintiff can claim nothing under or in virtue of his agreement with defendant's husband.
II. The only other proposition in the case is plaintiff's right to have judgment against the defendant for the amount of taxes paid by him. The general rule is that one who neglects to bring action 3. SAME: action for the recovery of real property, based upon to quiet title: a tax sale or deed, within the time fixed by recovery of law can not recover the money paid by him in taxes: extinguishment of the taxes on such property. limitation. Innes v. Drexel, 78 Iowa, 253; Rue v. King,74 Iowa, 288; Roth v. Munzenmaier, 118 Iowa, 326; Doud v. Blood,89 Iowa, 240.
It is plaintiff's contention, however, that this rule does not apply to an action such as this, which is in equity, wherein defendant is asking that her title to the property be quieted as against plaintiff's claim under his tax deed. This proposition presents the only doubtful question in the case. It must be remembered in this connection, however, that plaintiff brought the action, and is now asserting that *Page 7
his title is good and should be quieted, and that in the event this is not done that he have judgment for the amount of the taxes paid by him. The following cases are relied upon by plaintiff in support of his contention: Harber v. Sexton Son,66 Iowa, 211; Barke v. Early, 72 Iowa, 273; Buck v. Holt,74 Iowa, 294; Harrison v. Sauerwein, 70 Iowa, 291.
None of these seem to be in point. In Harber's case plaintiff, who was the owner of the record title, brought a suit in equity to set aside a tax deed, because the land was sold for taxes which had been paid before the sale was had. The trial court allowed defendants compensation for taxes paid by them during the five years last preceding the commencement of the action. This holding was reversed, and they were allowed to recover for all taxes paid; the reason for such holding being that it was not a case where the defendants had been sleeping upon their rights, and that, as plaintiff had seen fit to bring defendants into a court of equity, the defendants, not being guilty of any laches or wrongful act, were entitled to reimbursement as an incident to the relief granted to the plaintiff.
In Barke v. Early, supra, plaintiff, the owner of the patent title, brought action in equity to quiet his title and to set aside certain tax deeds held by the defendant. In his petition he offered to pay the defendant the amount of all taxes paid by him which might be found to be "legally due." It was held that this offer to pay a debt legally due applied to a claim which was already barred by the statute of limitations, and that such offer covered all taxes paid by the defendants. It was said in the opinion that "having made the offer to do equity, the court will not hear him set up the statute of limitations as an excuse for his refusal to perform."
Buck v. Holt, supra, was an action of like character. The tax deed was held invalid, because the taxes for which the land was sold had been paid before the sale. No question *Page 8
was there made regarding the bar of the statute of limitations as against the right of the tax title holder to recover from the owner for the payments made. The case followed Gardner v.Early, 69 Iowa, 42, which was also an action by the patent title holder to set aside a tax deed, because the delinquent taxes were not brought forward as required by the law then in existence. No question was there made regarding the statute of limitations, and the decision turned upon the proposition that, as plaintiff had brought his action to set aside the tax deed, it was his duty to reimburse the holder of the tax deed for payments made by him.
Harrison v. Sauerwein, supra, was a similar case and was determined upon equitable principles. No question regarding the statute of limitations was in the case, and no pronouncement was made with reference thereto. The present cause is an action brought by the purchaser at the tax sale to quiet his title, or, in the event that such relief be not granted, that he have judgment for the amount of the taxes paid by him such an action is barred in five years. Brown v. Painter, 44 Iowa, 368;Thompson v. Savage, 47 Iowa, 522; Sexton v. Peck,48 Iowa, 250; Thode v. Spofford, 65 Iowa, 294.
In La Rue v. King, 74 Iowa, 288, which was an action to enjoin the execution of a tax deed and to set aside a tax sale, the defendant, the holder of the tax deed, answered, resisting the granting of the relief asked, and also prayed that his title to the land be confirmed. He also asked to recover of plaintiff the taxes which he paid. It was there held that he could not recover for taxes paid more than five years prior to the filing of his counterclaim, citing Sexton v. Peck, 48 Iowa, 251;Brown v. Painter, 44 Iowa, 368.
In Thode v. Spofford, 65 Iowa, 294, which was an equitable action to set aside certain tax sales and deeds, plaintiff was required by the decree of the circuit court to *Page 9
pay certain sums, in order that he might redeem the property from the tax sale, and it was there held that defendants might recover for all taxes paid by them within five years prior to the commencement of the suit, with interest and penalties, and that all sums paid by them for taxes and upon tax sales before that time were barred by the statute of limitations, citing Brown v.Painter, 44 Iowa, 368.
In Innes v. Drexel, 78 Iowa, 253, it is said that the five year statute not only extinguishes the tax title, but all rights which are dependent upon it.
The latest pronouncement upon this question seems to be found in Roth v. Munzenmaier, supra, which was an action to foreclose a mortgage, wherein one Young, who claimed under a tax deed, was made a party defendant. The real controversy was between the holders of the tax title on the one side and the mortgagee and the holder of the patent title on the other. As against the tax title, the holder of the patent title pleaded the five year statute of limitations and laches. It was held that the plaintiff was under no obligations to reimburse the tax title holder for taxes paid; the reason being that plaintiff was not asking to redeem, but relying upon the five year statute of limitations as an extinguishment of the claim under the tax title. This and the other cases cited seem to rule the question now before us. Whatever of apparent conflict there may be in previous decisions is due to the fact that the principle ruling the different cases, depended largely upon the nature of the relief asked and as to who was the moving party.
In the instant case plaintiff, it seems, relied upon the promise of defendant's husband to reimburse him for the taxes paid. He said nothing about his tax deed to anyone, and defendant never heard of it until shortly before the beginning of this suit. He did nothing by way of asserting his title until his claim was barred by the statute of limitations. *Page 10
This statute not only operated as a complete defense to his action to quiet title, but also to his claim for taxes paid. His acceptance of the husband's promise to pay the taxes in lieu of his assertion of the title within a reasonable time, his laches in permitting the defendant to expend large sums of money in the improvement of the property, his failure to notify her of his claim or of her obligation to pay any taxes thereon, the fact that since 1893 the property was really exempt from taxation, and the other circumstances in the case render it inequitable that plaintiff be allowed anything for taxes paid. Evidently he was not relying at any time upon the property, but upon the husband's promise to reimburse him for these taxes. If he did not get his pay, it was not the defendant's fault.
No error in the decree is found, and it must be and it isaffirmed.
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[1] The land covered by the mortgage in suit was originally owned by a stranger to the present case, subject to a mortgage of $15,000.00. The Citizens State Bank of Earlham obtained a judgment against the original title holder, and one of the officers of said bank purchased, under execution issued on said judgment, all of the land except the homestead of the original owner. The officers of said bank induced the Capital City State Bank of Des Moines, the plaintiff herein, to purchase the $15,000.00 mortgage, and to foreclose the same, guaranteeing that if there was no redemption from such foreclosure sale they would personally take the land from the Capital City State Bank after the period of redemption had expired under such foreclosure; and two of the directors of the State Bank of Earlham executed their note to the Capital City State Bank for the sum of $16,974.71, which represented the amount then due upon the $15,000.00 mortgage, including the expenses of foreclosure, and the said Capital City State Bank assigned its sheriff's certificate to one of the officers of said Citizens State Bank, viz: Albert Riser, and he took title to the farm in controversy through sheriff's deed, and, then, to secure the payment of the note above mentioned, executed to the Capital City State Bank a mortgage on the land, and shortly thereafter the said Albert Riser conveyed the land to the Citizens State Bank of Earlham.
It appears from the evidence without controversy that all of *Page 682
these transactions were for and on behalf of the said Citizens State Bank, and that said Citizens State Bank at all times after the issuance of the sheriff's deed was the owner of the land, and that Albert Riser and Hoskins, who joined with him in the execution of the note for $16,974.71 to the Capital City State Bank, were merely accommodation makers, and that the accommodated party was the Citizens State Bank of Earlham.
On September 6, 1930, L.A. Andrew was appointed by the district court receiver of the Citizens State Bank; that the Citizens State Bank had been renting the farm, collecting the rents, and treating it as its own; that after the appointment of L.A. Andrew as receiver, and on the 2nd day of February, 1931, he leased the property involved by a written lease for the period from March 1, 1931, to March 1, 1932, for cash rent in the sum of $1,100.00, taking two notes therefor, one for $300.00, due October 15, 1931, and one for $800.00, due January 1, 1932, which notes or the proceeds thereof are still in the possession of the said L.A. Andrew, receiver.
On July 6, 1931, plaintiff commenced its action to foreclose its mortgage securing the $16,974.71 note, alleging, in its petition, that in addition to having a real estate mortgage on the premises described, it also had a complete chattel mortgage, which was a part of the real estate mortgage, and which provided as follows: "And, also, the rents, issues, use and profits of said land and the crops raised thereon from now until the debt secured thereby shall be paid in full. To Have And To Hold the premises above described, with all the appurtenances thereunto belonging, and also said rents, issues and profits of said land, and the crops raised thereon, unto the said party of the second part and to its heirs and assigns forever, the said party of the first part hereby covenanting that the above described premises and also the rents, issues, use and profits of said land, and the crops thereon, are free from any encumbrances," and that the mortgagors will warrant and defend the title against all persons whomsoever. That said chattel mortgage was properly recorded and indexed as such, and that thereunder the rents and profits of the mortgaged land are pledged as security for the debt as fully and completely as the real estate is pledged; and plaintiff asks that its said chattel mortgage be foreclosed and established as a lien against the rents and profits arising from said land during the year 1931, and also during the period of redemption. And plaintiff further asks that L.A. Andrew, receiver, who is *Page 683
in possession of said premises, be ordered and directed to keep the rents and profits therefrom separate and distinct from the assets of the Citizens State Bank and not to commingle them with the assets of said bank.
L.A. Andrew, as receiver, in his answer to the petition of plaintiff states that he is entitled to the rents and profits of said real estate during the year of redemption; that he represents the creditors of the said bank, and holds the rent notes for the year 1931, and that the same should be considered assets of said bank; that the plaintiff's chattel mortgage is not a lien upon such rent notes, nor upon the crops raised upon the real estate during the year 1931.
There was a trial to the court, and on the 16th day of December, 1931, a decree was entered in favor of plaintiff for the amount due under its mortgage for $18,327.96, and establishing the lien of the mortgage and foreclosing the same.
The decree also found and adjudged that L.A. Andrew, as receiver, was entitled to hold the rents for the described premises from March 1, 1931, to February 28, 1932, amounting to $1,100.00, and that plaintiff was not entitled to have its chattel mortgage made a lien upon said rents or rent notes. And from such decree, finding and order, the plaintiff, Capital City State Bank, prosecutes this appeal.
It will be observed from the foregoing that the only controversy here is as to who is entitled to the 1931 rent represented by the notes aggregating $1,100.00, or the proceeds thereof, held by the said L.A. Andrew, receiver, and which were awarded to him by the decree of the trial court.
I. It is the contention of the plaintiff-appellant: (1) That L.A. Andrew, receiver of the Citizens State Bank, took the land subject to the same plight that it was in at the time the said bank received it, — that is, that the bank held it subject to the real estate and chattel mortgage; that he took the assets of the Citizens State Bank subject to all prior vested liens, and that he had no more or greater rights in the land, or the rents, or crops thereon, than had the said Citizens State Bank; and (2) that under the combined mortgage (real and chattel) of the plaintiff, the plaintiff had a lien not only on the real estate, but also on the rents, issues and profits therefrom.
The first contention of the appellant seems to be universally *Page 684
recognized by text writers and courts as the general rule, with possibly one exception, which we will hereinafter mention.
The following citations support such proposition:
Vol. 53 Cor. Jur. 102 lays down the following general rule:
"The general rule is that the appointment of a receiver does not divest valid pre-existing liens, but that the receiver takes the property in the same plight and condition and subject to the same equities and liens as existed against it in the hands of the person or corporation out of whose possession it was taken, although this rule cannot be invoked to the prejudice of the insolvent's creditors. And it is held that any previous equitable assignment of property will be enforced in a court of equity against the receiver."
In the case of Home Savings Trust Co. v. Polk District Court,121 Iowa 1, this court used the following language:
"The appointment of a receiver determines no right. Such an order is granted for the purpose of preserving the property, to the end that it may ultimately be distributed among the parties found entitled thereto. The order of appointment creates no lien in favor of the parties applying for it, nor does it give them any advantage or preference over other claimants to the property. * * * The receiver represents all parties in interest, and it is his duty to administer upon the estate for the benefit of all parties concerned. * * * 48 Ia. 518."
In Silver v. Wickfield Farms, 209 Iowa 856, this court said:
"A receiver of a corporation cannot impeach any act which the corporation itself could not successfully assail. * * * In brief, a receiver of a corporation can acquire no greater rights in the property than the corporation had at the time his rights became fixed. He takes the property subject to all equities or incumbrances existing against the same in the hands of the insolvent, and he is not viewed as a bona-fide purchaser for value."
The one possible exception to, or modification of, the general rule thus announced is the case of Schlesselman v. Martin,207 Iowa 907, in which we find the following language:
"The receiver is something more than the representative of the debtor. He is the representative also of the creditors. Indeed he is *Page 685
primarily such. He may assert as against the debtor and those claiming under him any right which the creditors themselves could have asserted. We think his position is necessarily analogous to that of a creditor who had taken the rent notes either as payment or security of a debt. In such a case, the subsequent right accruing to the mortgagee to assert a lien under his receivership clause will not relate back so as to defeat the creditor, who already has a lien upon the subject-matter. * * * The necessary effect of the receivership was to convey to the receiver all the property of the bank of whatever kind, subject only to plaintiff's lien. Whatever rights the receiver acquired by such transfer, on April 14, 1927, may not be defeated by the assertion of a later lien under the receivership clause. The plaintiff had no lien on the rents and profits at the time of such transfer."
But the cited case furnishes little support, if any, for the appellees' position in the present case. In the cited case there was a dispute as to whether the rent notes were in existence at the time of the receivership, or whether they were notes taken by the receiver after he was appointed and qualified. In that case the question involved was whether a subsequent right accruing to the mortgagee to assert a lien under his receivership clause would relate back so as to defeat the creditor, or his representative, the receiver, who already had a lien upon the subject matter. In the Schlesselman case we said:
"The necessary effect of the receivership was to convey to the receiver all the property of the bank, of whatever kind, subject only to plaintiff's lien. Whatever rights the receiver acquired * * * may not be defeated by the assertion of a later lien under the receivership clause. The plaintiff had no lien on the rents and profits at the time of such transfer."
In the Schlesselman case the plaintiff applied for a receiver under the terms of his mortgage, for the purpose of satisfying a deficiency judgment. The appointment was made upon that very ground and none other. In the case at bar no application for, or appointment of, a receiver, under the terms of plaintiff's mortgage, is involved. Plaintiff's action is for the foreclosure, not only of its real estate mortgage, but also of its claimed chattel mortgage. There was no chattel mortgage involved in the Schlesselman case. The *Page 686
point there decided was that the bank receiver had a prior right to current rents over the remedial rights of the mortgage receiver. Here it is not a lien that comes into active being or existence only upon the commencement of a mortgage foreclosure, with which we have to deal, but a lien created by the contract itself. It is purely the assertion of a contract right and not merely a remedial right.
It must be borne in mind that in the present case, the Citizens State Bank of Earlham was in fact always the owner of the real estate involved, and the mortgagor, or at least stood in the place of the mortgagor, with no more rights and under the same obligations as was the person who executed the mortgage. The rent notes and lease involved in this action were taken by the receiver after his appointment.
We said in Silver v. Wickfield Farms, 209 Iowa 856, that:
"* * * a receiver of a corporation can acquire no greater rights in the property than the corporation had, at the time his rights became fixed. He takes the property subject to all equities or incumbrances existing against the same in the hands of the insolvent. * * *"
We also said in the most recent case of Andrew v. Home Savings Bank, 215 Iowa 401, speaking through Kindig, Judge, that:
"Of course, if the rent under the lease made by the Superintendent of Banking for the period in question were still uncollected, the real estate mortgagee, under proper circumstances, might have a superior claim thereto over that of such lessor. As a matter of fact, however, there were no rents, issues, or profits due or to accrue in the future during the year in question on the demised real estate after the commencement of the action to foreclose the real estate mortgage and obtain the appointment of a receiver. To put the thought differently, when the real estate mortgagee changed her prospective right to the rents, issues, and profits into a present right to collect and appropriate any such rents, issues, and profits there might be during the year in question, there were in fact no rents, issues, or profits due or to accrue for that period. Such rents, issues, and profits for the period in question already had been collected and appropriated by the Superintendent of Banking, as before explained, and therefore did not exist as rents, issues, and profits to be collected and appropriated by the real estate mortgagee." *Page 687
In the present case the rents, aggregating $1,100.00 and evidenced by two promissory notes, had not been collected at the time of the commencement of plaintiff's present action, and the notes, or the proceeds therefrom, are still in the possession of the bank receiver.
It follows from what we have said that L.A. Andrew, as receiver in the present case, has no more rights to the crops or the rents represented by the notes in controversy here than did the Citizens State Bank of Earlham. He took the notes in controversy, and all other assets of said bank, subject to all prior vested liens, and it remains to be determined whether the plaintiff in this action had a vested lien under its claimed chattel mortgage at the time the notes in question were taken by L.A. Andrew, as receiver of the Earlham bank.
[2] II. Appellant's second contention is that it had a complete real estate and a complete chattel mortgage, both properly recorded and indexed; that such fact gave notice to the world that the plaintiff had a lien, not only on the real estate, but also on the rents, issues and profits therefrom, and that such instrument was good as against L.A. Andrew, as receiver of the Citizens State Bank of Earlham. The appellee contests this proposition, and denies that the recitation in plaintiff's mortgage was a valid chattel mortgage, and cites McMaster v. Emerson, 109 Iowa 284; Farmers Merch. State Sav. Bank v. Kriegel, 196 Iowa 833; Johnson v. Siedel, 178 Iowa 244; and the Schlesselman case, in support of such denial.
The McMaster v. Emerson case was an action to foreclose a chattel mortgage upon crops grown during certain years, including 1897. A prior mortgage upon the land was foreclosed in May, 1897. The title holders had leased the land for 1897 and assigned the lease to a bona-fide creditor. The chattel mortgagors had nothing to do with the raising of the crops for the year 1897, and had no interest therein whatever, and this court held that the chattel mortgage in question did not attach to the 1897 crop for that reason.
In the case of Farmers Merch. State Sav. Bank v. Kriegel, the controversy was between an intervener, as an alleged holder of a chattel mortgage on certain personal property, including "all uses and profits" of certain real estate, and an attaching creditor, who attached certain personal property; and this court held that such a mortgage "does not embrace ripened grains severed from the soil, or animals nurtured from such grains." Holding further that *Page 688
"if it is to be construed as a chattel mortgage upon this property, then it became such as of its date, * * * and constructive notice thereof was imparted as of the date of its registration." The mortgage involved in that action was a regular real estate mortgage describing certain land and contained the following clause: "Together with all tenements hereditaments, appurtenances, rents, uses and profits thereof." The mortgage further provided that in the event of default the holder thereof would "be entitled to the appointment of a receiver who shall have the power to enter upon, take, hold possession, cultivate and operate said premises, and to rent the same and collect therents, issues and profits therefrom, until the judgment is fully paid or the time for redemption has expired * * *" The mortgagee's claim under that mortgage was to oats, corn, cattle, horses, hogs, hay, etc. The grain and hay were claimed on the theory that they were produced out of the soil of the mortgaged farm though now severed therefrom. The cattle, horses and hogs were claimed on the theory that they were either produced upon the farm or were nurtured therefrom by the products of the farm. In construing the language of the claimed chattel mortgage this court held that no rents were involved, and that the question to be determined was what construction was to be put upon the words"uses and profits," and held that the quoted language was not such "as would apprise a mortgagor that he was executing a chattel mortgage, as well as a real estate mortgage," and that to so construe the language "would be to introduce into it an element of stealth and to impose upon the mortgagor a contractual obligation of which he was himself unconscious." And this court held that the language used was not sufficient to create a lien as under a chattel mortgage.
The mortgage in question in the case at bar contains, after the description of the land, the following:
"And, also, the rents, issues, use and profits of said land, and the crops raised thereon, from now until the debt secured thereby shall be paid in full."
"To Have And To Hold the premises above described with all the appurtenances thereunto belonging, and also said rents, issues, use and profits of said land, and the crops raised thereon unto the said party of the second part, and to its heirs and assigns forever, and the said party of the first part hereby covenanting that the above described premises and also the rents, issues, use and profits *Page 689
of said land, and the crops thereon, are free from any incumbrances, and mortgagors" will warrant, etc.
This language is identical with the description in a like mortgage construed in the case of Farmers Trust and Savings Bank v. Miller, 203 Iowa 1380, except that the last paragraph above quoted, appearing in the mortgage here under consideration, did not appear in the mortgage in the cited case. And this court held that the language in the cited case was unlike that in the Farmers Merchants State Sav. Bank v. Kriegel case and that the distinctive feature of the language in the Farmers Bank v. Miller case was that the granting clause specifically covered crops raised on the land "from now until the debt secured thereby shall be paid in full." And this court finally held, speaking through Judge Albert, as follows:
"It is our conclusion, therefore, that this instrument did constitute a chattel mortgage lien on all crops grown on the land in question from the time of its date, — or rather, its recording, — until the debt secured by it was fully paid. Being a valid chattel mortgage, and having been properly indexed, as required by law, it was notice to the world of plaintiff's rights thereunder."
And the court further held that the "general rule that a purchaser of property covered by duly recorded chattel mortgage takes it subject to the lien of such mortgage applies in the instant case."
We are satisfied to follow the precedent and rule thus laid down and established, and hold that the language in the mortgage under consideration constituted a valid chattel mortgage and created a valid, vested, and existing lien upon the rents, issues, use and profits of the land described and the crops raised thereon from the date of its execution and recording. See also Soehren v. Hein, 214 Iowa 1060.
We hold also that the Citizens State Bank of Earlham was at all times the owner of this land; that the title was held for a time by Riser for the bank; that in executing the mortgage in question Riser acted for the bank; that L.A. Andrew, as receiver for the bank, was not an innocent purchaser, but that he held the land in the same plight as it was in the hands of the Citizens State Bank, and subject to the rights of plaintiff under its said chattel mortgage, and that the plaintiff is entitled to the notes now held by the receiver, or to the proceeds thereof, representing the rents from the *Page 690
land covered by plaintiff's mortgage. It follows that so much of the decree of the court below as appealed from, which holds that L.A. Andrew, receiver, is entitled to the promissory notes aggregating $1,100.00, was erroneous, and must be reversed. — Reversed.
KINDIG, C.J., and STEVENS, ALBERT, MITCHELL, KINTZINGER, and DONEGAN, JJ., concur.
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At the close of plaintiff's evidence, the defendant moved for a directed verdict on grounds which may be epitomized as follows, to wit: (1) that it has not been shown by the plaintiff's evidence that the decedent was free from contributory negligence; (2) that the evidence fails to show that the defendant was guilty of recklessness within the meaning of the statute; (3) that, under the entire record as made by the *Page 380
plaintiff's evidence, the court could not allow a verdict in favor of the plaintiff to stand.
[1] Since plaintiff's action is founded upon recklessness, and not upon negligence, contributory negligence by the decedent is not an element to be considered or dealt with at any stage of the case. Therefore, there is no merit in the first ground of appellee's motion for a directed verdict. See Siesseger v. Puth,213 Iowa 164.
For a proper determination of the remaining grounds of appellee's motion for a directed verdict, we must necessarily refer somewhat in detail to the evidence, which we will now proceed to do. The accident occurred in the town of Grundy Center in the early evening of April 13, 1930. The defendant, at the time in question, was driving a Ford car, the decedent being seated to the right of the defendant. As a result of the accident, the decedent received a laceration across the throat, which cut the jugular vein, and also a puncture of the skull under the ear, and because of his injuries he died the following day. A proper conception of the scene of the accident and the environments can be best obtained by an observation of the accompanying plat, which in enlarged form was introduced in evidence.
[EDITORS' NOTE: PLAT IS ELECTRONICALLY NON-TRANSFERRABLE.]
Iowa State Highway No. 90, Main Street, and G Avenue are identical, and this highway runs east and west through the *Page 381
town, as shown by the plat. Fourth Street is a north and south street, which crosses G Avenue, Main Street, or State Highway No. 90, and because of a surveyor's correction line, said street extending south from Main Street lies a little to the west of a continuation of the same street which runs north from Main Street. Fourth Street, running north from Main Street, is also a primary highway, known as No. 14. Both ends of Fourth Street are24.2 feet wide between the curbs. The width of the intersection lying between the two extensions of Fourth Street is 47.5 feet between the curbs. The witness who made the plat for plaintiff testified that the distance from the west line of Fourth Street running north to the east line of Fourth Street running south is 66 feet. "That 66 feet is a part of the intersection." There is a stop sign on Highway No. 14, or Fourth Street, running north, which is 28.4 feet north of Main Street, or Iowa State Highway No. 90. This stop sign is properly placed on the right-hand side of Highway No. 14 as one approaches Highway No. 90. At the time in question, the defendant came from the north on Fourth Street and entered the intersection to continue his journey on the same street leading south. A Buick Sedan, driven by Leversee, approached the intersection from the west. It appears from the record that the defendant was first within the intersection. Leversee, as a witness, testified that, as he was traveling east on G Avenue (Highway No. 90) and was past the center of Fourth Street (running south), the Ford Runabout (the car driven by the defendant) approached from the northeast and the right front wheel of the Ford hit the left front wheel of his car at an angle of about 45 degrees; that he did not believe that his car moved a foot as the result of the impact, and while there was some damage done to his car, he was in no way injured; that he did not notice where his car was with reference to the sidewalk running north and south on the east side of Fourth Street, and could not tell how much distance there was between the back of his car and the center of Fourth Street extending south from Main Street; that the Ford car was about fifteen or twenty feet distant when he first saw it. He marked a cross on the plat, designated by the letter J, as the spot in the intersection where the left front wheel of his car was at the time of the impact, and a cross designated by the letter O on the plat was marked by him as a witness, as *Page 382
the location of the defendant's car when he first saw it. He was asked the question as to the speed at which the Ford automobile was travelling and answered: "I couldn't judge the speed." One Alfred Bienfang was operating a filling station at the southwest corner of the intersection between Main Street and Fourth Street, running south, and testified that he saw the defendant's car in Fourth Street coming south; that it did not stop for the stop sign; that he did not notice the speed of the Ford car. Elgin Bienfang resided in a house located in the southeast corner of the intersection of Main Street and Fourth Street, running south. He testified:
"I was in the house putting my boy to bed and was seated at an open window where I could look right up North 4th Street. I saw Armstrong's car as he came down North 4th Street. It did not come to a complete stop before passing the stop sign, or before coming into G Avenue. They were coming south. * * * They just swung to the right and started south again as long as I could see them. * * * As he got to the stop sign, he slowed up, and increased speed after he started again. * * * The last I seen him he was increasing speed. * * * Q. When did you first know that an accident had occurred? A. When I heard the crash. Q. How long after you saw, or after you last saw, the Armstrong car was it before you heard the crash? A. Just about a couple of minutes. Q. A couple of minutes? A. Yes, I heard the crash and got right out there and saw the position that the cars were in right after the accident happened. The point of contact of the two cars was right in line with the sidewalk running north and south on the west side of my house. The Buick car was facing east; the Ford car was facing southwest. * * * Q. And you saw him (Armstrong) from the time that he was the other side of the stop sign until he reached the center of the street? A. Yes, sir. * * * Q. Where was the Armstrong car at the time that it was first turned in the direction where, in which, it was going at the time of the accident? A. In the center of the street. Q. How fast was the Armstrong car traveling at the time of the accident? A. About 20 miles an hour. * * * Q. In what direction was Armstrong looking at the time of the accident? A. He was looking straight ahead. * * * It wasn't dark, I could see a man's eyes across the street." *Page 383
Another witness testified that the accident happened south of the center of Main Street and east of the center of 4th Street, running south from Main Street.
The foregoing constitutes all of the material testimony upon which we must determine whether it is sufficient to support a verdict of a jury that the defendant's conduct was reckless, within the meaning of the law.
[2] It will be noted that, while there is evidence that the defendant slowed down, yet he failed to make a complete stop at the stop sign before entering the intersection. The place in the intersection where the testimony tends to show that the collision occurred, was five or six rods from the stop sign. It is apparent that this failure, if any, on the part of the defendant, was not and could not have been the proximate cause of the collision. Whatever, if any other, infraction of our statutory law may be shown by the testimony, they are such as to make only a prima facie case of negligence against the appellee. McDougal v. Bormann, 211 Iowa 950; Sergeant v. Challis, 213 Iowa 57; Riepe v. Elting, 89 Iowa 82. Were it not for the fact, as disclosed by the testimony, that the collision occurred south of the center of Main Street, and east of the center of the south extension of Fourth Street, it could hardly be claimed that there is evidence of negligence resulting in the collision. While, if the action were such as could be founded on negligence, the jury might be allowed to find, from the evidence, that the defendant was guilty of negligence, — that is, that he failed to exercise such care as an ordinarily careful and prudent person would have exercised under the same circumstances, — yet that does not solve the problem. This action is founded upon recklessness, which means more than negligence. It means proceeding without heed of or concern for consequences. See Siesseger v. Puth, 213 Iowa 164. In order for conduct to be reckless, within the meaning of the law, it must be such as to manifest a heedless disregard for or indifference to the rights of others. We find nothing in the record hereinbefore set out which evinces a heedless disregard of the rights of Neessen, who was seated by the side of the driver. We do not think that it could reasonably be said from the evidence that the defendant's conduct, though negligent it may have been, was such a heedless disregard of the rights of Neessen as to justify a verdict in favor of the administratrix. *Page 384
See Silver v. Silver, (Conn.) 143 A. 240; Ascher v. Friedman, (Conn.) 147 A. 263. The mind is prone to look upon the result, but, unless the acts of the defendant would have been reckless within the meaning of the law without the resulting injury to Neessen, they are not reckless merely because Neessen lost his life. Our statute, Section 5026-b1, Code, 1931, was enacted for the very purpose of preventing recovery by a guest of damages resulting from the negligence of the driver of the automobile. In order for the guest to recover, he must establish one of two things, to wit: intoxication of the driver or reckless operation by him of the automobile. It is quite clear to us that the plaintiff has not made out a case, unless it be that the right of action by a guest to recover damages for negligence has been revived by Section 5028, Code, 1931, enacted by the 43 G.A. as Chapter 128 of the Acts of said General Assembly.
[3] The plaintiff contends that by the provisions of said latter section, the legislature has defined the term "reckless operation," used in Section 5026-b1, Code, 1931, and identical with said numbered section in the Code of 1927. The question at this point is: Did the legislature, by reason of the enactment of Section 5028, Code, 1931, which constitutes a part of Chapter 128, Acts of the 43 G.A., restore the right to a guest to recover damages for negligence, — that is, failure to exercise ordinary care, the same care which an ordinarily careful and prudent person would exercise under the same circumstances? We answer in the negative. Section 5026, Code, 1924, provides:
"In all cases where damage is done by any car driven by any person under fifteen years of age and in all cases where damage is done by the car, driven by consent of the owner, by reason of negligence of the driver, the owner of the car shall be liable for such damage."
This section was amended by Chapter 119 of the Acts of the 42 G.A. as follows:
"Provided, however, the owner or operator of a motor vehicle shall not be liable for any damages to any passenger or person riding in said motor vehicle as a guest or by invitation and not for hire, unless damage is caused as a result of the driver of said motor vehicle being under the influence of intoxicating *Page 385
liquor or because of the reckless operation by him of such motor vehicle."
This amendment now comprises Section 5026-b1, Codes 1927 and 1931. Thus, it is found that the 42 G.A. in plain language asserted that there can be no recovery by a guest for damages, unless the same is caused by the intoxication of the driver "or because of the reckless operation by him (the driver) of such motor vehicle."
[4] Section 5028, Code, 1931, provides:
"Any person who drives any motor vehicle upon a highway carelessly and heedlessly in wilful or wanton disregard of the rights or safety of others, or without due caution and circumspection, or at a speed or in a manner so as to endanger or be likely to endanger any person or property, shall be guilty of reckless driving, and upon conviction shall be punished as provided in Section 5089."
It is this latter section which it is claimed defines "reckless operation," as used in Section 5026-b1, Code, 1927. It will be noted that in Section 5028, Code, 1931, several alternatives are mentioned, and it is added that the offender as to any one "shall be guilty of reckless driving, and upon conviction shall be punished as provided in Section 5089." It will be noted that the words used in Section 5026-b1 are "reckless operation," while in Section 5028 the words used are "shall be guilty of reckless driving." The first alternative in Section 5028 clearly constitutes recklessness as defined by any of the courts. The second alternative, to wit, "or without due caution and circumspection," constitutes no more than negligence; for if one drive a motor vehicle upon a highway without due caution and circumspection, — that is, without such caution and circumspection as an ordinarily careful and prudent person would exercise under the same circumstances, — he is guilty of negligence. Under Section 5026-b1, the guest can recover for "reckless operation." Therefore, if the legislature in Section 5028, Code, 1931, has defined the term "reckless operation" as used in Section 5026-b1 so as to include negligence, then the 43 G.A. has nullified what the 42 G.A. did in this respect and has in effect made Section 5026-b1 a dead letter. This could not have been the intention of the subsequent legislation. The title to Chapter 128, Acts of *Page 386
the 43 G.A., is, "An act to amend Sections 5028 * * * 5021 * * * 5029 of the Code of 1927 * * *." The title in no way refers to Section 5026-b1, Code, 1927, or Chapter 119, Acts of the 42 G.A. The legislation therein enacted provides substitutes for Section 5028 and 5029, Code, 1927, and an amendment to Section 5021, Code, 1927. Said Chapter 128, Acts of the 43 G.A., contains no repealing clause. Therefore, if Section 5026-b1, Code, 1927, has been repealed, in whole or in part, by reason of the enactment of the latter legislation, it must be by implication. Repeals by implication are not favored. See Ogilvie v. City of Des Moines,212 Iowa 117, and cases therein cited. Repeals by implication will not be adjudged if it can reasonably be avoided. See Ogilvie v. City of Des Moines, 212 Iowa 117, and cases therein cited.
It will be noted that Section 5028, Code, 1931, is clearly a criminal statute. We think it quite clear that the words "reckless driving," as therein used, constitute only a name for the offense for a violation of any of the several acts therein designated. All crimes in this state are statutory. In many instances in our criminal code, the act or acts constituting a crime are designated, and the crime named. In many others, the act or acts constituting a crime are designated, the punishment prescribed, and the crime not named. As said by us in State v. Hoaglin, 207 Iowa 745:
"To illustrate, Section 12910 of the Code designates the act and names the crime as murder. In Section 12979 of the Code, after defining the crime, the words used are, `shall be deemed guilty of sodomy.' In Section 12994, the acts constituting the offense are designated, and said legislative enactment provides: `He shall be guilty of burglary.' In Section 13005, after naming the acts which constitute the offense, the statutory law provides: `He is guilty of larceny.' In Section 13038, after providing what constitutes the offense, it is further provided, `He is guilty of robbery.' Likewise in Sections 13162 and 13165, it being provided in the former section that `they are guilty of a conspiracy,' and in the latter section, `He is guilty of perjury.'"
An examination of Sections 12967, 12992, 12993, 12981, 12982, 12969, 12970, and many other sections of the Code will *Page 387
disclose that certain acts are designated as punishable but no name prescribed for the offense.
An examination of our motor vehicle law discloses that from the very time of its original enactment down to the present time, it provided that every person operating a motor vehicle on the public highways of the state should drive the same in a careful and prudent manner, etc., and further provided that a violation thereof should be punished. To illustrate, Section 5028, Code, 1927, provides that every person operating a motor vehicle on the public highway of this state shall drive the same in a careful and prudent manner, and at a rate of speed that will not endanger the property of another, or the life or limb of any person; and Section 5089 of said Code provides:
"A violation of any provision of this chapter shall be punished by a fine not exceeding $100 or by imprisonment not exceeding thirty days, except in those instances where some other punishment is specifically pointed out."
For similar provisions, see Sections 20 and 23, Chapter 72, Acts of the 34 G.A.; Sections 27 and 29, Chapter 275, Acts 38 G.A.; Sections 5028 and 5089, Code, 1924. In none of these prior enactments was the offense given a name. In the Statute now under consideration, the legislature has merely given the offense a name, and without any intent to define the term "reckless operation" as used in Section 5026-b1, Code, 1927. Any other appropriate name would have served the purpose just as well. We think it quite clear that there was no intent on the part of the legislature by the enactment of Section 5028, Code, 1931, to define the term "reckless operation" as used in Section 5026-b1, or to repeal or modify said section and make it a dead letter. This construction permits both sections to stand and gives both full force and effect in accordance with the manifest intent of the legislature. Therefore, as thus properly construed, the right of a guest to recover damages for negligence of the driver of an automobile has not been restored by reason of the latter enactment. The cause of action of a guest must be founded on intoxication of the driver, or "reckless operation" by the driver, within the meaning of the term "reckless operation" as construed by this court.
[5] The appellee contends that the evidence fails to show *Page 388
that the decedent was the guest of the defendant. It will be noticed that the statute, Section 5026-b1, Codes 1927 and 1931, provides:
"The owner or operator of a motor vehicle shall not be liable for any damages to any passenger or person riding in said motor vehicle as a guest or by invitation and not for hire," etc.
It will also be noted that said amendment, Chapter 119, Acts 42 G.A., is in the nature of a proviso. The record shows that the decedent was riding in the car of the defendant, seated by his side. The evidence fails to show any express invitation or that the decedent's riding was not for hire. There is nothing in the record showing, or tending to show, that the deceased and the defendant were engaged in a common enterprise at the time in question, by reason of which it might be claimed that reckless acts of the one would be imputed to the other; but we reserve pronouncement at this time upon the question as to whether the burden is upon the plaintiff in a case of this kind to prove that the person riding in the car with the defendant was riding by express invitation and not for hire.
For the reasons hereinbefore mentioned, the judgment of the trial court is correct, and the same is hereby affirmed. — Affirmed.
FAVILLE, C.J., and STEVENS, De GRAFF, and ALBERT, JJ., concur.
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This action is brought by the plaintiff, Ruby Tallmon, against Edward Larson, defendant, to recover damages for injuries sustained in a collision which occurred between the car belonging to plaintiff's husband, and in which she was a passenger, and the car of the defendant, on February 10, 1937.
The plaintiff was riding in the front seat with her husband, who was driving, and they were proceeding west on a dirt road, which, it appears from the evidence, was icy, and the traveled way of which was about 15 feet wide. The road was rounded *Page 565
at the center and at the edges sloped off to ditches which were partially filled with ice and snow. The road had been traveled at about the center, and in the surface there were two ruts made by cars traveling over the road. The car in which plaintiff was riding was traveling west and was proceeding toward the top of a small hill in the road. The defendant's car was traveling east. Defendant had driven down a hill farther to the west, at a distance of about 200 feet from the crest of the hill up which plaintiff's car was proceeding. On arriving at the crest of the hill plaintiff's driver started down, and when part way down the hill was met by the defendant's car, which was being driven in the ruts in the center of the traveled roadway, with the result that the cars collided and the plaintiff was injured. Plaintiff testified, as also did her husband, that before the impact of the two vehicles plaintiff's driver had got his car over with the left wheels in the right rut, but that defendant continued in the middle of the road. This, of course, was disputed by the defendant, who insists that the car in which plaintiff was riding remained in the ruts in the center of the road.
There were only three eyewitnesses to the collision, but others testified as to the position of the cars after the collision.
Plaintiff alleges that the defendant was negligent in several respects, two of which grounds were submitted to the jury: First, that the defendant failed to give one half of the traveled way by turning to the right; and, second, that defendant did not have his car under control so that he could yield one half of the traveled portion of the highway. The case was tried to a jury, who returned a verdict in plaintiff's favor. A motion for a new trial and exceptions to instructions was filed and submitted, and overruled, and defendant appeals.
I. The only errors relied upon for reversal, and argued by the defendant, are: First, that the court erred in submitting instruction No. 5; and, second, that the court erred in submitting such instruction individually and in combination with other of the instructions.
The question before us is whether or not there was error in the giving of instruction No. 5 so as to require a reversal. Instruction No. 5 followed instruction No. 4, which was a definition of negligence. Said instruction No. 5 is as follows:
"In connection with the instruction just given you with *Page 566
reference to negligence in this case, you are instructed that if you find that the negligence of the defendant was the direct and moving cause of the collision of the defendant's car with the car in which plaintiff was riding, then you are instructed that the injury to the plaintiff was the natural result of that negligence and ordinary prudence would suggest that the negligence would probably result in such an injury and if you so find, your verdict herein should be for the plaintiff."
The defendant contends that the court erred in giving said instruction No. 5, and insists that such instruction purports to instruct the jury completely on the matter of liability, but omits the element of contributory negligence. On the other hand, plaintiff contends that this ommission does not vitiate the instructions, which must be taken as a whole, and that other instructions clearly define the rule as to contributory negligence.
[1] In considering this instruction we must take into consideration the instructions following, and also instructions Nos. 3 and 4, immediately preceding it.
In instruction No. 3 the court definitely laid down the matters which must be established by the plaintiff before she would be entitled to recover — that plaintiff was not herself guilty of any contributory negligence; that the evidence must show that the defendant was guilty of negligence; that such acts were the proximate cause of the injury, and the fact of the sustaining of the injury; and that all such matters must be established by a preponderance of the evidence.
In instruction No. 4 the court fully defined negligence and instructed the jury "that negligence does not depend upon the question whether the result of an act might have been reasonably foreseen, it being sufficient to support the charge of negligence if the result of the act is natural, though not the necessary thing to be expected, or if ordinary prudence would suggest that the act or omission would probably result in injury."
[2] Instruction No. 5, immediately following and given in connection with the former instruction as above set out, amplifies this paragraph of instruction No. 4. The evident purpose of the court in giving this instruction was to further explain that part of instruction No. 4 above set out.
The distinction between this instruction and the one given *Page 567
in the recent case of Bobst v. Hoxie Truck Line, 221 Iowa 823,267 N.W. 673, is that in the latter case the court undertook to give all the elements necessary to constitute negligence, and instructed the jury that if the facts recited were shown, they should return a verdict for the plaintiff; and no reference was given to the element of contributory negligence. In the instant case the instruction as to negligence is merely general, and the purpose of the instruction was to add to and emphasize the fact that if the negligence of the defendant was the cause of the collision, the injury to the plaintiff would be the natural result and ordinary prudence would suggest the probable result.
The instructions following, Nos. 6, 7, 8, 9, and 11, all correctly and clearly laid down the rule given in instruction No. 3, that plaintiff could not recover in the event of contributory negligence.
It seems to us that the jury could hardly be misled as to the purpose of the instruction and, when read in connection with the other instructions, they would not be confused. The jury was repeatedly informed that there could be no recovery unless plaintiff had shown herself free from contributory negligence, and we can hardly conceive of their rendering a verdict without taking into consideration the rules given in practically all of the instructions. There was evidence before them of the actions of the plaintiff at the time in controversy, and, while there was not a great deal of testimony offered as to that point, no evidence was offered to the contrary, and we are of the opinion that the jury was in no way misled and that there was not prejudicial error. See Flesch v. Schlue, 194 Iowa 1200,191 N.W. 63.
[3] This disposition of the error assigned in giving instruction No. 5 renders unnecessary further discussion as to conflict in the instructions. While it is true and needs no citation of authority that instructions which are conflicting and confusing constitute reversible error, yet we do not think that the instructions in this case, when considered as a whole, were such as to mislead or confuse the jury or to constitute reversible error.
Under the record the case should be, and it is, affirmed. — Affirmed.
MITCHELL, C.J., and SAGER, BLISS, OLIVER, MILLER, and HAMILTON, JJ., concur. *Page 568
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https://www.courtlistener.com/api/rest/v3/opinions/3432593/
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The parties to this action reside in the same block in Marcus, Iowa. Appellant is engaged in the restaurant business and appellee is the proprietor of a garage. Both are married.
Appellant, as a witness in his own behalf, testified that he is thirty-seven years of age, that he was married in 1917 and has one child twelve years of age. According to his testimony, he heard rumors of illicit relations between appellee and his wife and on several evenings in October and November he concealed himself behind a bush in the vicinity of his home and on each occasion he saw appellee drive past his home and his wife enter the automobile with him; that they drove into the country, returning late at night. The testimony of one other witness tended to show that appellee and appellant's wife met on different occasions on earlier dates in Sioux City; that Mrs. Newcomer visited at the home of the witness, a friend of many years; that appellee and she went riding afternoons and evenings together, and that upon one occasion they went to an apartment house early in the afternoon and remained until evening. The number of visits is not definitely stated, but the inference permissible from the testimony is that they were numerous. No explanation of any of these trips or visits is offered by appellee. On the contrary, they were all denied by him. Appellant's wife was not a witness, did not testify for either party, but it is shown that she left her home prior to the date of the trial. The court overruled the motion of appellee for a directed verdict made at the close of plaintiff's testimony.
[1] The sufficiency of the evidence to sustain a verdict in favor of appellant, if one had been returned, is not particularly challenged on this appeal. Reliance is placed upon error in the court's charge to the jury. We quote the material portion of the charge:
"Par. 6. You are instructed therefore that if the plaintiff *Page 309
has proved to you by a preponderance of the evidence, the burden being upon him so to prove that at all the times in controversy in this action, the plaintiff and Irene Newcomer were husband and wife, and that such fact was at all times known to the defendant, Joe Ament, and that on or about the 30th day of October, 1930, or at any time thereafter, the defendant, Joe Ament, did in fact have sexual intercourse with the said Irene Newcomer, then the plaintiff is entitled to recover herein, and in that event you should return your verdict in his favor."
[2] The petition in this case charged illicit relations between the defendant and appellant's wife at various times and places within two years last past. The several visits observed by appellant were in the last days of October. The relationships which the evidence tended to establish between the parties in Sioux City occurred as early as July. The instruction limited the acts to those occurring on or about October 30th and thereafter. The term "on or about" does not have a precise meaning, and when it refers to time, permits some variation. In such case, it means approximately or reasonably near the date fixed. The phrase is not, however, in such case, susceptible of wide divergence or variation. Bocus v. Waldmann, 160 Pac. (Cal.) 180; Passow Sons v. Harris, 156 Pac. (Cal.) 997; Texas N.O.R.R. Co. v. Weems, 184 S.W. (Tex.) 1103. No date in July is "on or about" the last days of October. Had the jury believed the testimony as to the relationships referred to in the testimony in Sioux City several months prior to October 30th and that the acts were not repeated "on or about October 30th," a verdict for the plaintiff could not have been returned under the foregoing instruction. The use of the word "thereafter" in the instruction both emphasizes the date and narrows the permissible variation in the date. It may be that if the jury had believed that acts of sexual intercourse occurred in Sioux City in July, the conclusion that the same relationships existed in October would probably follow under the circumstances shown in the testimony; nevertheless, the court cannot say that the more technical aspects of the instruction would not have been observed with a contrary result. The jury may well have understood from the instruction that only acts occurring on or about October 30th and thereafter would justify a verdict in favor of plaintiff. The instruction, *Page 310
standing alone, is clearly erroneous. It is urged by appellee that the succeeding paragraph of the charge fully and clearly cured the error. The succeeding portion of the charge goes no further than to instruct the jury that all facts and circumstances shown in evidence might be considered for the purpose of determining whether any adulterous relations existed between the parties. It did not, as argued by appellant, withdraw any part of the evidence from the jury, but it did specially limit the right of recovery to illicit acts occurring on or about October 30th, or thereafter. The gravamen of the cause of action is adultery. The action is not to recover damages for the alienation of affections. Antle v. Craven, 109 Iowa 346; Wood v. Mathews, 47 Iowa 409; Ruby v. Lawson, 182 Iowa 1156. The jury should have been instructed to return a verdict for appellant if the evidence established that adulterous relations were shown between the parties either prior or subsequent to October 30th.
We are not in this opinion concerned with the weight or credibility of the evidence. The error in the instruction was not cured by anything that followed, and it clearly cannot be said that it was without prejudice. It follows that the judgment must be and it is — Reversed.
WAGNER, C.J., and FAVILLE, De GRAFF, and ALBERT, JJ., concur.
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432529/
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Plaintiff's petition was in four counts. In the first she alleged: The marriage of herself and James O'Dell on April 6, 1927, and the continuance of the marital relation until his death on June 27, 1943; that defendants were children or grandchildren of her husband, and his son Albert was executor of the deceased's estate; that on the day of the marriage, but after the consummation of the ceremony, she and her husband executed a prenuptial agreement; and that because the agreement was executed after the inception of the marriage relation it was not legal or binding, and she as the surviving spouse is entitled to receive as her own property one third of all the property owned by James O'Dell at his death.
In count two she alleged: That after the marriage her husband voluntarily announced his intention of destroying or changing the prenuptial agreement (Exhibit A) for the purpose of giving plaintiff a greater interest in his property at his death than she would receive under the agreement; that not finding the agreement in his metal or "strong box" he thought it was lost or misplaced, and of no further force or effect, and he and plaintiff executed another paper revoking or changing Exhibit A so as to give to plaintiff her widow's or distributive statutory share in his property or estate; that this later-executed paper was placed by the deceased in said box and was not thereafter removed by him but said box and its contents were taken and thereafter kept by Albert O'Dell and plaintiff is unable to produce it.
In count three plaintiff, without waiving any rights under counts one and two, alleged that under both Exhibit A and the last will of deceased she was entitled to the use of the homestead forty acres so long as she lived and did not remarry, and the income, rents, and profits therefrom since his death.
In count four plaintiff, without waiving any rights under *Page 439
the other counts, alleged her right to a widow's allowance for the period of twelve months from her husband's death.
Under each count plaintiff prayed for a widow's allowance of $2,400. Under count one she also prayed that the antenuptial agreement, Exhibit A, be held invalid from its inception, and that she be decreed the absolute owner of one third of the property of the deceased. Under count two plaintiff prayed, in the event relief under count one was not granted as prayed, that the court decree that deceased had expressly and completely revoked Exhibit A because of the fact that he attempted to destroy it and was prevented from doing so only because it could not be found; and that it be decreed that Exhibit A was also revoked by the execution of the later written instrument, and that she be decreed the owner of one third of all the property owned by the deceased at his death.
The antenuptial agreement was attached to the petition as an exhibit, as was also the deceased's will. The agreement is as follows:
"CONTRACT.
This contract made * * * this 6th day of April, A.D., 1927, by * * * James Odell * * * and Rosa E. Cox * * * This is a Prenuptial Contract. Each party is to retain their own property both Real and Personal for themselves and their children. The wife to have a life interest in the Homestead so long as she remains the wife or widow of James Odell. In case she remarries the property to go to the Heirs of James Odell at once. In case of separation there is to be no claims of either party on the other party's property or money.
Signed this day and date first above written.
James Odell. Rosa E. Cox.
Signed before me G.E. Turner, a Notary Public in and for Ringgold County, Iowa, by James Odell and Rosa E. Cox this 6th day of April, A.D., 1927.
G.E. Turner, Notary Public."
The will of James O'Dell was drawn by G.E. Turner on *Page 440
April 6, 1927, at the time Exhibit A was drawn. Its execution by O'Dell was witnessed by Turner and another. It provides first for the payment of all debts and funeral charges. Paragraph 2 provides:
"My will is that my property shall be divided share and share alike between my children. That my widow and younger children shall have a home; The widow as long as she remains My widow and does not remarry, the children until they become of age. * * * My wife's name is Rosa E. Odell."
He then named his eight children and appointed the two oldest as executors.
Defendants in their answer "specifically allege" that Exhibit A was executed before the marriage, and "specifically deny" that it was executed thereafter; they deny that the deceased intended to destroy it, or executed any instrument revoking it, and allege that it was a binding agreement at his death; they deny the destruction by them of the alleged later agreement; they admit the marriage and also the death of James O'Dell as alleged in the petition.
The court found against plaintiff on all counts excepting count three, on which it found for plaintiff, and rendered decree in conformity with said findings.
I. The only evidential matter in controversy, respecting count one of the petition, was whether the wedding party, consisting of Albert O'Dell and wife, James O'Dell, and Rosa E. Cox, on its way from the James O'Dell farm to Mount Ayr, where the marriage ceremony took place, stopped at the G.E. Turner bank at Kellerton and the prenuptial agreement and the will were executed, or whether the stop was made and these papers were executed after the marriage ceremony at Mount Ayr and on the return trip to the farm. It is undisputed that O'Dell and Mrs. Cox were married about noon, at Mount Ayr, by a justice of the peace. Testifying for herself, plaintiff said that the party drove direct from the farm, without stopping at the Kellerton bank, to Mount Ayr, where the marriage took place, and that after the marriage they stopped at the Kellerton bank on the return home. She also put on G.E. Turner as a witness. *Page 441
He testified that James O'Dell and Rosa E. Cox stopped at the bank and O'Dell gave directions for the drawing of the prenuptial agreement and his will; that he prepared both instruments and O'Dell and Mrs. Cox signed the agreement and O'Dell executed the will. It was Turner's recollection that these instruments were drawn and executed in the forenoon of April 6, 1927, and before the marriage ceremony had been performed. Albert O'Dell and wife, as witnesses for the defendants, testified that the automobile which carried the party, and which Albert O'Dell was driving, stopped at the Kellerton bank on the way to Mount Ayr in the forenoon, and James O'Dell and Mrs. Cox got out and remained in the bank for about a half hour and then came out and the party proceeded to Mount Ayr, where the marriage took place, and they then took a "short cut" home without stopping at Kellerton.
II. The following matters, unless otherwise indicated, are not in dispute: It was the second marriage for each of the parties. Plaintiff was then about fifty-one years old. His age does not appear. She had two children, grown and married. He had several adult children, and two children at home — Hazel and Wayne, respectively ten and twelve years old. Albert and his family lived on another farm of James O'Dell — the east farm — which he and his father operated in partnership. Wayne, whom plaintiff had mothered and cared for since he was twelve, later married and he and his wife lived in the parental home. James O'Dell suffered a stroke of paralysis about three years after the marriage, which disabled him to the day of his death about thirteen years later. On objection based on section 11257, Code, 1939 (section 622.4, Code, 1946, commonly called the "dead man statute"), plaintiff, erroneously, was not permitted to describe his condition. Plaintiff then offered what she proposed to testify — which offer also was refused — that during these thirteen or more years O'Dell was not able to perform any labor; it was exceedingly difficult for him to get around — more so at some times than at others; this difficulty became worse; to a large extent he lost control of his kidneys and bowels; he could walk only with assistance and required the use of a wheel chair; for a time before his death a daughter of plaintiff was *Page 442
employed to help care for him in 1943. Neighbors testified of his disability and of the added burdens thereby imposed on plaintiff. A farmer neighbor testified O'Dell "required somebody whenever he wanted to move. The last few years he was just at the mercy of someone else's aid. Mrs. O'Dell milked, raised chickens, fed the hogs and cattle and did the general housework on the farm. I would say she was a good wife and willing worker." A neighbor housewife testified, "She did all of the work necessary around the place, keeping house, feeding chickens, gathering eggs, watering calves, milking cows and feeding hogs. I never saw her mistreat Mr. O'Dell. She gave him good care and attention." Others testified to her faithful, constant, and competent care of him. She was a good wife and nurse to him. No one testified to the contrary.
O'Dell appreciated that the advantages of the marriage were largely with him and that the burdens were almost wholly upon his wife. Sometime about the first of August 1940 he wrote to Mrs. Pickens, a married daughter of his wife, who lived with her husband and family in Clarinda, and asked her to come to the farm. About two weeks after receiving the letter, late in the afternoon, she came to the O'Dell home. Mr. O'Dell was sitting in a chair in the south yard. Over objection, properly overruled, he told her that he was not satisfied with the situation on the farm and that he wished to change his will, and asked her to take him to Mount Ayr. She told him it was too late in the day and that she would take him at some other time. In two or three weeks she returned and talked again to James O'Dell. Speaking of that talk, she testified:
"Well, he told me at that time he had papers signed so that — he spoke of Mother as `the woman' — can hold her share. He indicated that it was in this connection he asked me to take him to Mount Ayr."
Being asked to give Mr. O'Dell's words, if she could recall them, she testified:
"Well, he told me he had gone to Kellerton and had this paper drawn up so she could hold her widow's share in the estate. He wanted it fixed so she could not be beaten out of it. *Page 443
* * * He said that this first paper that was drawn up had disappeared and was destroyed or stolen, and he said he wasn't satisfied with that, that he was going to have a different paper made."
On interrogation by the court as to whether the statement in the last sentence above was on her first or second trip to see Mr. O'Dell, she replied, "That wasn't the first time I called."
On further direct examination by her attorney, she testified:
"It was on this second visit he told me about the first contract being missing and that he had got to work and fixed it up so that Mother could hold her widow's share in the estate. It was the second visit he told me about the missing contract."
The court rightly overruled defendants' motion to strike all of Mrs. Pickens' testimony of the conversation with Mr. O'Dell concerning the disappearance of papers based upon "the reason it is incompetent, irrelevant and immaterial, and having to do with a paper which clearly had no testamentary power. There has been no consideration shown for its drawing and no competent proof of its contents or existence."
Over objection that the testimony called for was "incompetent, irrelevant and immaterial and hearsay," the plaintiff testified:
"Along in the fall of 1940, I recall having a conversation with Wayne's wife regarding the sale of some hogs. We were on the east porch of the house peeling tomatoes to can. The argument was over selling some hogs. We got to arguing who was to have the bulk of it. I said it ought to be fifty-fifty, and she spoke up and said, `Nothing of the kind,' that Wayne ought to have all of it. I said, `You know better than that.' Wayne showed up at the time this argument was taking place. He came in and said, `What the Hell is going on here?' and came up and struck me twice or three times. I ran in where Dad was on the south porch, sitting in his wheel chair. Wayne came out there. Q. What took place out there? Mr. Wilson: I object to that as the witness is incompetent to testify to a personal *Page 444
transaction with a person since deceased. Q. What took place between Wayne O'Dell and your husband, James O'Dell, in which you took no part? Mr. Wilson: Same objection. The Court: You may answer. A. He struck him with his cane. Dad struck Wayne with his cane and Wayne told him if he did it again, he would kick the guts out of him. Later on that day there was an argument and conversation with Wayne and his father in which I took no part."
The court did not err in overruling any of the objections to the testimony of plaintiff.
"Q. Now, tell the Court where that was and what you heard said between Wayne and his father? Mr. Wilson: That is objected to as the witness is incompetent to testify to a personal transaction with a person since deceased, and an opinion and conclusionwhether or not she took part in it."
There was no basis for the italicized part of the objection, and the fore part of the objection was technically deficient in not being definitely identified with section 11257, Code, 1939.
"The Court: You may answer. A. Well, he, James O'Dell, wanted me to get the box."
The answer was stricken on the objection that it was "a direct transaction with her husband."
While the request of plaintiff's husband that she bring him the metal "strong box" from the top shelf in the pantry and her compliance therewith was the taking place of a matter between them, it may be fairly questioned whether it was a "personal transaction" within the purview of said section 11257. If so, her passing the butter to him at a meal would also be. In Martin v. Shannon, 92 Iowa 374, 377, 60 N.W. 645, the court said:
"By a `personal transaction' the statute means some business or negotiations between two or more individuals."
In Sheldon v. Thornburg, 153 Iowa 622, 626, 133 N.W. 1076, a more involved definition was given, which was criticized and explained in Hayes v. Snader, 182 Iowa 443-452, *Page 445
165 N.W. 1041. In Lucas v. McDonald Son, 126 Iowa 678, 679, 102 N.W. 532, the wife of the plaintiff was permitted to testify over objection that the deceased requested her to call her husband into the room of deceased. But conceding, arguendo, that bringing the box to her husband was a personal transaction under the statute, it did not make her a participant in what her husband, or what he and Wayne, did thereafter. The record shows that she took no part in any way in what he did nor in the conversation between her husband and Wayne. The court refused to permit her to testify that her husband in her presence examined the papers in the box. Her testimony that her husband opened the box and could not find the paper he was hunting and called Wayne to look was stricken, and she was held incompetent to testify to the conversation between Wayne and her husband. The court gave as its reason for the rulings that, since plaintiff had produced the box, what followed was all a part of the same transaction. The court also struck her answer that her only participation was in producing the box. Plaintiff then offered proof — which offer was refused — that in an examination of the contents of the box by her husband, Exhibit A, the prenuptial contract, was not found, and her husband accused Wayne of having taken the paper; that Wayne denied it and cursed his father, and the latter then asked Wayne to take him to Kellerton, as he wanted to go there to draw another agreement where Rosa would get her widow's share, and have it drawn so the "kids couldn't beat her out of it"; that Wayne objected to taking his father to Kellerton and the latter then said he would get one of his neighbors to do so, and Wayne then said he would take him. She took no part in the conversation at any time. Plaintiff was held incompetent to testify that she and Wayne and her husband went in a car to Kellerton, but, omitting any mention of her husband, she was permitted to testify that she and Wayne went in an automobile to Burger's store at Kellerton. Again she was held incompetent to say that her husband went into the store with them. She testified that she and Wayne went into the store and sat on a settee, and, over objection, that Wayne left the store at the request of her *Page 446
husband to go and get Mr. Turner and bring him to the store. She took no part in the conversation in the store.
[1] The court erred, to the prejudice of the plaintiff, in a number of rulings holding her incompetent under said section 11257. Other rulings were not prejudicial. The testimony excluded was necessarily not considered by the court. This court has repeatedly held that matters of fact concerning the decedent, learned solely by observation and not by a transaction or communication with him, may be testified to by one designated as an incompetent witness under the statute. The witness was not incompetent to testify to the physical condition of her husband, nor to her observation of him as he examined the "strong box" and failed to find the prenuptial contract, to which fact he called the attention of Wayne. While she knew better than anyone else his physical condition, there was no substantial error in not permitting her to testify to his disabilities, as other witnesses sufficiently covered the matter. But no witness testified to the matters concerning the examination of the box. That she was a competent witness in that matter, see In re Estate of Talty,232 Iowa 280, 282, 5 N.W.2d 584, 144 A.L.R. 859, and cases cited. Her part ended in the matter when she produced the box.
Plaintiff took no part in the conversation between her husband and Wayne. She was competent to testify to that conversation. We have so held many times. See Erusha v. Tomash, 98 Iowa 510, 513-515, 67 N.W. 390 (in that case the wife testified to seeing her husband make payment to the deceased payee of their joint promissory note); In re Will of Fish, 220 Iowa 1247-1251, 264 N.W. 123, and cases cited; Gardner v. Marquis, 224 Iowa 458, 461, 462, 275 N.W. 493; Johnson v. Johnson, 52 Iowa 586, 3 N.W. 661.
[2] The conversation and incidents which took place between the husband and Wayne were confined strictly to them. It is true that these matters had an incidental and indirect relation to the writing nullifying the prenuptial agreement and granting to her her widow's distributive share in her husband's estate at his death. But this court has repeatedly held that a witness, prohibited by the "dead man statute" from testifying *Page 447
against specified persons, is not incompetent to testify to facts from which inferences may be drawn tending to establish a claim or liability against, or a transaction with, or a service to, one under disability or his estate. See Yoder v. Engelbert, 155 Iowa 515, 517, 136 N.W. 522; Martin v. Shannon, supra, 92 Iowa 374, 376-378, 60 N.W. 645; Furenes v. Eide, 109 Iowa 511, 514, 80 N.W. 539, 77 Am. St. Rep. 545; McElhenney v. Hendricks, 82 Iowa 657, 659, 48 N.W. 1056; Campbell v. Collins, 133 Iowa 152, 154, 155, 110 N.W. 435, 436 (stating, "This court has often held that the statute was not designed to exclude evidence, not itself obnoxious to its prohibition, from which inferences of what was done between the parties might be drawn."); Graham v. McKinney,147 Iowa 164, 166, 167, 125 N.W. 840; Marietta v. Marietta,90 Iowa 201-204, 57 N.W. 708; Walkley v. Clarke, 107 Iowa 451, 454, 455, 78 N.W. 70; Scott v. Brenton, 168 Iowa 201, 211, 150 N.W. 56; In re Estate of LaGrange, 191 Iowa 129, 132, 181 N.W. 807 (where the claimant testified that she placed the certificates of deposit, which she alleged her deceased father gave her, in her suitcase in his presence); Sankey v. Cook, 82 Iowa 125, 128, 47 N.W. 1077; In re Estate of Allis, 221 Iowa 918-922, 267 N.W. 683; Lucas v. McDonald Son, supra, 126 Iowa 678, 679, 102 N.W. 1041; Dysart v. Furrow, 90 Iowa 59, 62, 57 N.W. 644; Hayes v. Snader, supra, 182 Iowa 443-447, 165 N.W. 1041, 1043 (stating, "The vital thing is, what is the nature of the proof, not what does it tend to establish. The sole question here is whether what was objected to spoke to a `personal transaction or communication between such witness and the decedent.' If it did not do that, it is wholly immaterial who gave the testimony, or what it tended to establish)."
The trial court was in error in holding that, simply because the witness brought the box to her husband in his wheel chair, she became a participant in his search through the box and in his conversation with Wayne, and thereby an incompetent witness.
[3] Going back now to the Burger store and the drafting of the second agreement by Turner. Plaintiff testified:
"Mr. O'Dell told Mr. Turner that he wanted a paper drawn *Page 448
up. That the other one had been destroyed and lost. Mr. O'Dell said he wanted a paper drawn up so Rosa could have her widow's share and the boys couldn't take it away from her. Mr. Turnerleft the store for a while and when he came back he brought apaper with him. He read the paper to us and asked us to sign it.Dad took the paper and put it in his pocket." (Italicized only for identification.)
The court first let all of this testimony in and then struck it. The italicized testimony refers only to matters of observation. She took no part in picking up the paper or in putting it in her husband's pocket. She would not be an incompetent witness to these matters unless these acts by her husband could be said to be a part of the transaction or business between them of executing the paper. The part of the testimony not italicized was rightly stricken. The plaintiff did not take part in the conversation between O'Dell and Turner. But what O'Dell said was a direction to Turner as to what he wished stated in the paper. It was said in the presence of plaintiff, and was a part of the transaction — of the preparation, drafting, and signing of the paper. She was incompetent to testify to it. It comes within the rule of In re Estate of Runnells, 203 Iowa 144, 212 N.W. 327; In re Estate of Willmott, 211 Iowa 34, 230 N.W. 330, 71 A.L.R. 1018; and Maasdam v. Estate of Maasdam,237 Iowa 877, 24 N.W.2d 316.
The striking of the italicized testimony did not hurt plaintiff, as the execution of the paper was established by Turner's testimony. But Turner's memory was not as complete as plaintiff's respecting what he was told to put in the paper or as to what he did put in it.
Mr. Turner recalled clearly the evening in September or October 1940, when Wayne O'Dell came to his real estate and insurance office in Kellerton and asked him to come to the Burger store, as his father wished to see him. He came to the store with Wayne and found Mr. and Mrs. O'Dell sitting on the settee in the middle of the store. Mr. O'Dell told him what he wished to see him about:
"Q. Tell the court what James O'Dell told you that evening. *Page 449
A. Bob, I don't believe I can tell you all of the words he told me. He told me he wanted a contract and he told me the way hewanted it and I wrote it. Q. Now, I will ask you to refresh your recollection, did he mention anything about this old contract that you had drawn on the date of their marriage? A. I don't recall that he did, Bob. I have heard it testified that he did but I don't remember distinctly that Mr. O'Dell said anything to me about its being destroyed or mislaid or anything. Q. Well now, then, just state to the best of your recollection the substance of what he told you that he wanted you to put in the agreement which you were to draw. A. I just can't remember all of the things he told me to put in there. Q. Now then, Mr. Turner, did you, pursuant to his direction, leave the store and prepare an agreement? A. Yes, I did. I went across the street to my office to prepare the agreement. I think it was on one sheet of paper. When I returned to the store, I read the contract to James O'Dell. Mrs. O'Dell was there at the time. * * * Well, I don't remember the exact wording of any of this paper. I know when I looked it over, I thought then he hadn't kicked her out. She wasto get a fair settlement, but it was twenty years ago [it was five years ago] and I just don't know. * * * I just don't remember. I can't get what the terms were. * * * I remember at the time the paper, I wrote, I thought Mr. O'Dell was providingfor this woman, but just how or what the things were that he was providing, I just don't remember. Q. What is your best recollection to what extent he was providing for her? A. I don't know what extent. I felt it was enough to take care of her but Ijust don't know. I did not keep a copy of this paper. I haven't seen it since I saw it in the store in the fall of 1940. The paper was signed at that time by James O'Dell and his wife, Mrs. O'Dell, in my presence."
[4] There is no direct contradiction in the matters of fact set out in Division II hereof. Section 11257, Code, 1939, barred plaintiff from being a witness to the matters testified to by Turner. But Turner did not testify that the writing which he prepared in the fall of 1940 did not give plaintiff a third of, or the statutory widow's share in, her deceased husband's estate. His testimony was only that he could not remember the exact *Page 450
wording or terms of the paper. His testimony is not in conflict with that of Mrs. Pickens, nor with what the plaintiff testified, or offered to testify to, of the incidents and conversation at the O'Dell home on the afternoon before the meeting in Burger's store. Instead it corroborates each of them. The fact that all the terms of the lost instrument could not be shown clearly and definitely was not fatal to plaintiff's case. The ultimate fact to be ascertained is whether the antenuptial agreement was rescinded, or so modified that the limitation on her property right in the estate of the deceased was abrogated, and her widow's statutory share was restored. If, under the whole record, this is shown, it is sufficient, and it is not necessary that other terms or details, if any, of the instrument be shown.
There is no basis for reasonable doubt as to the intention of O'Dell to modify or rescind the prenuptial agreement and to give to her the distributive share of his estate to which she was entitled by statute in the absence of said agreement. In seeking to ascertain the intent we look for the motives and reasons most likely to have been inducing causes. The record shows him to have been a just and honorable man. It also shows conduct on the part of plaintiff, and other conditions and circumstances, such as would strongly appeal to a man of that character to do just what plaintiff insists that he intended to do and did do. Regardless of the fact that the plaintiff was performing only the duties and meeting the responsibilities incumbent upon her as a wife, O'Dell deeply appreciated that, because of his affliction, she was getting the worst of their marital bargain. He had never intended that bargain to be so harsh to her. He was not satisfied with conditions at home nor with the old contract. Before Mrs. Pickens could return, the disgraceful occurrence on the porch brought to an immediate decision his determination to change or revoke the prenuptial agreement and to give the plaintiff her statutory distributive share. With that in mind he examined the contents of the metal box, and, not finding the contract, he accused Wayne of taking it. It was then he insisted that Wayne take him to Kellerton so that another agreement be drawn giving his wife her widow's share and keeping "the kids from beating her out of it." The *Page 451
court did not permit plaintiff to testify to this conversation between her husband and Wayne, in which she took no part, and it appears in the record only in her offer of proof. The court's ruling was prejudicial error and the testimony offered must be considered by this court. O'Dell's conclusion that the prenuptial agreement had been removed from the box, his intention to change or revoke it, and the execution of a paper granting to plaintiff her one-third distributive share as a widow, are clearly established by the testimony of Mrs. Pickens, the refused testimony of the plaintiff, and the corroborative testimony of Turner. This testimony stands without the slightest refutation, contradiction, or impeachment, and it is corroborated by every other item of testimony and by every circumstance in the record. Defendants offered no testimony to the contrary. There is no other reasonable inference or assumption than that O'Dell intended to rescind or modify the old contract and restore to plaintiff her distributive share on his death. That the paper executed in September or October 1940, in Burger's store, effected that purpose and intention is quite as certainly established. Plaintiff heard her husband tell Wayne that he intended to execute such a paper. Turner read that paper to her and she signed it. Uneducated as she was, and unable to read or write, yet she must have understood from the reading of the paper that it effected her husband's expressed intentions. Turner testified that, "He [O'Dell] told me he wanted a contract and hetold me the way he wanted it and I wrote it." From the intentions which O'Dell had expressed to others of drawing a paper to restore his wife's right to a widow's share, there is no other reasonable inference than that is what he told Turner he wished put in the contract, and certainly it should be assumed that Turner put just that in the contract, even though he testified he had no definite memory of what it contained. Defendants did not see fit to offer any testimony in denial. Plaintiff's testimony and her proffered testimony concerning what took place on the porch, including the conversation between her husband and Wayne, could have been denied by Wayne and his wife, but they were not called as witnesses. One purpose of the *Page 452
"dead man statute" is to close the mouth of the living participant relative to transactions or communications with a person whose mouth is closed by death. That was not the situation here. O'Dell was not available as a witness. But Wayne, his son and one of the defendants claiming under him as an heir, was present to speak for his father and for himself and his codefendants. He could have testified to or denied any conversation between himself and father that autumn day in 1940 concerning his father's trip to Kellerton to have the paper drawn. He could have testified as to what took place in Burger's store. But when the court erroneously refused to permit the plaintiff to testify about these matters, the defendants concluded that Wayne should remain silent, and thus deprive the trial court and this court of evidence of matters of which each side had equal knowledge. The usual inequality which the statute was enacted to prevent did not exist in this case. Plaintiff urges that other jurisdictions have held that statutes in substance like said section 11257 have no application in similar situations. Citing Fulkerson v. Thornton, 68 Mo. 468; Peacock v. Stott, 90 N.C. 518; Moore v. Harlan Hollingsworth, 37 Ga. 623; Read v. Sturtevant, 40 Vt. 521. But plaintiff's case does not depend upon such a holding by us, however sound it may be.
[5] When Wayne and plaintiff and her husband left Burger's store that night they went directly home. She was asked this question: "Upon your arrival home * * * Mrs. O'Dell did you see what was done with the paper that you and your husband had signed?"
Although it was shown, without contradiction, by Turner's testimony, that a paper was signed by them that evening, objection under section 11257 was sustained. A like objection was sustained to this question: "State whether or not you know that that paper * * * was put in this box that we have been referring to as the strong box?"
Neither question on its face called for testimony that was obnoxious to the prohibition of the statute. The first question called only for a matter of observation, and the second called for her personal knowledge and observation and not for a transaction or communication. Proffer was made that she had *Page 453
personal knowledge that the paper executed in October 1940 was placed in the strong box and was never removed by her or by anyone else in her presence, and that the box was placed on a shelf beyond the reach of her husband in his physical condition.
Later her husband's physical condition became much worse and Albert O'Dell was appointed his guardian. It is undenied that thereafter Albert took the box and its key into his possession. On his father's death he was appointed executor. He testified that he found the prenuptial contract of 1927, but never saw or found the paper executed in October 1940.
[6] The only attack made upon the testimony of Mrs. Pickens is that it was incompetent in that it referred to self-serving declarations of the deceased. This contention is broader than any objection made to her testimony. No such objection was made. Furthermore, there is no basis in the record for such contention. The fair inference is that the declarations were against his interest. The prenuptial agreement was a limitation upon her interest in his estate, while the declarations were of his intention to increase that interest and of his executed act carrying that intention into effect. Defendants' citation of and quotation from Truitt v. Truitt, 290 Ky. 632, 162 S.W.2d 31, 140 A.L.R. 1127, do not aid them.
III. The record establishes by evidence sufficient in quality and quantity that James O'Dell voluntarily and on his own initiative revoked or modified the prenuptial agreement of April 6, 1927, and granted and gave to her a distributive share of one third in all the property which he owned at his death, to all of which she gave her full consent and acceptance. It matters not that the defendants produced the prenuptial agreement after decedent's death. He thought it was lost or stolen. He was not satisfied with it and wished to rescind or change it and substitute for it an instrument giving her a widow's share under the statute. They agreed upon this and carried it into effect by the paper executed in Burger's store. Though the prenuptial contract was not physically destroyed and remained in existence, its binding force and effect insofar as it deprived her of her distributive share in his estate had been destroyed by the acts of its makers. *Page 454
[7] The district court, in its opinion or "Ruling of the Court," said:
"It is obvious, in view of the fact that this pre-nuptial contract was produced on the trial of this case, that it never in fact was destroyed, and unless there was some specific instrument signed by both of the contracting parties thereto, agreeing that it be rescinded, it would continue to be in full force and effect."
This is stating the law too favorably for defendants. As we have just stated, the physical existence of the paper contract may be of little importance. If the parties have mutually agreed to its revocation and dissolution, and this is established, that, of course, is an end of the controversy. The fact that an adversely interested person has secreted the instrument to prevent its destruction or cancellation by the makers does not defeat its mutual abrogation by the latter. In a similar controversy over the mutual revocation of an antenuptial agreement, the Kansas court, in Gordon v. Munn, 87 Kan. 624, 634, 125 P. 1, 4, Ann. Cas. 1914A, 783, said:
"It is the opinion of this court that in view of the general verdict this answer should be considered as relating to the document — the paper itself — rather than to the agreement. The actual destruction of the paper would be competent evidence upon that issue in connection with the accompanying circumstances, but if the contract was canceled by agreement, that is, if the parties mutually agreed that it should be annulled and no longer be in effect, the destruction of the paper upon which it was written was not controlling."
For the same reasons, the preservation of the paper by someone contrary to the intention of the makers would be of no effect.
IV. Speaking of the instrument executed in the fall of 1940, the court also said:
"There is nothing in the statement of what it is alleged James O'Dell told Mr. Turner to put into the contract in regard *Page 455
to any rescission by mutual agreement of the pre-nuptial contract, so far as it is described in the petition, which would indicate that Mrs. Rosa O'Dell thereby waived that provision of the prenuptial contract which deprived her husband of the right to share in her estate in event he survived her."
[8] Antenuptial contracts — designated in this record as pre-nuptial contracts — are in no way different from any other ordinary contract. They are to be considered, construed, and treated as are contracts in general. In re Estate of Shepherd,220 Iowa 12, 19, 261 N.W. 35, 39; Cummings v. Wood, 197 Iowa 1356, 1358, 199 N.W. 369. Any executory contract, when the rights of others are not involved, may be rescinded altogether, or modified, by the mutual consent of the parties. Either party may waive any right thereunder. Those who are qualified to make an antenuptial or other contract are likewise qualified, by mutual consent to eliminate or modify any part thereof, or to unmake the contract altogether, or to substitute a new contract. The court said, in Esterly Harvesting Mach. Co. v. Bemis, 93 Iowa 398, 400, 61 N.W. 980, 981:
"A claim that the parties could make such a contract, and then could not, as between themselves, unmake or change it, would involve a legal absurdity."
Also, in Mortensen v. Frederickson Bros., 190 Iowa 832, 845, 846, 180 N.W. 977, 982, the court stated:
"Certainly, the parties had a right to make such a new contract. They had a right to make any kind of a new contract respecting the subject-matter that was not in violation of law. * * * It is undoubtedly the law that the parties to a contract can mutually agree to a rescission of the same. This is the rule of our cases. Pardoe v. Jones, 161 Iowa 426, 430 [143 N.W. 405]; Tague v. McColm, 145 Iowa 179 [181, 123 N.W. 960]; Quarton v. American Law Book Co., 143 Iowa 517, 528 [529, 121 N.W. 1009]."
Even where the contract specifies the method by which it may be determined, as said in Webster County Buick Co. v. *Page 456
Nebraska Buick Auto Co., 216 Iowa 485, 487, 488, 249 N.W. 203, 204, that "does not take away the right of the parties to terminate the contract in any other way or to supersede it with another contract by mutual agreement. There is no restraint on the right of parties to cancel a contract by mutual agreement, where rights of third parties have not intervened. Wilson v. Holub, 202 Iowa 550 [554], 210 N.W. 593, 58 A.L.R. 646." To like effect, see Lambertson v. National Inv. Fin. Co., 200 Iowa 527, 532, 202 N.W. 119; Collins v. Gard, 224 Iowa 236, 240, 275 N.W. 392; Osborne Co. v. Backer, 81 Iowa 375, 379, 47 N.W. 70; Rice Hutchins Shoe Co. v. Oransky Sons, 184 Iowa 6, 7, 166 N.W. 690; Vande Stouwe v. Bankers L. Co., 218 Iowa 1182, 1197, 254 N.W. 790, 798; American Sav. Bk. v. Borcherding, 201 Iowa 765, 768, 208 N.W. 518; Central Iowa Motors Co. v. Clancy, 206 Iowa 1090, 1092, 221 N.W. 774, 775 (the court saying, "Of course, this agreement [rescission] may be either expressed or implied"); Morse v. Slocum, 192 Iowa 1080, 1094, 186 N.W. 22.
[9] The important matter is the mutual consent and intent to rescind, modify, or substitute, and the manner of putting it into effect is of no particular consequence and is to be determined by the parties. Such rescission or modification requires no particular method, manner, or form. In Griffey v. Lubben,196 Iowa 465, 468, 193 N.W. 410, 411, the court, after quoting a Massachusetts case, said:
"This is only another way of stating the fundamental proposition that, so long as any contract, written or oral, remains executory, it is an essential attribute of the right of persons to do what they will with their own (so long as their acts do not prejudice the rights of others); that the parties thereto may, by mutual consent, change, alter, or amend its terms, or may abandon it altogether; and that, such arrangement once made, it affords a complete defense by either to any assertion by the other of any right based upon the original unperformed contract. It makes little difference whether a defense of this character be classed as waiver or estoppel, or be given any other technical label, it operates, when pleaded and proved, to *Page 457
relieve from liability the party sought to be charged upon the alleged contract."
An executory written contract may be rescinded, canceled, or revoked, by another written instrument, or orally, or by matters in pais. A "specific instrument signed by both of the contracting parties thereto, agreeing that it be rescinded," is not necessary. Neither is an express statement of rescission nor an express release of obligations by either party necessary in such instrument. In Mortensen v. Frederickson Bros., supra, 190 Iowa 832, 847, 848, 180 N.W. 977, 983, the court cited with approval this quotation from 2 Black on Rescission and Cancellation, section 528:
"`The rescission of a contract by mutual consent does not require a formal agreement or release, but may result from any act or any course of conduct of the parties which clearly indicates their mutual understanding that the contract is abrogated or terminated, or from the acquiescence of one party in its explicit repudiation by the other.' * * * There can be rescission by the acts and conduct of the parties, without an express oral agreement to rescind."
In Cincotta v. Catania, 95 Cal. App. 99, 100, 272 P. 330, 331, the court said that it is unnecessary to prove the parties used the words, "We do mutually rescind the contract," but rescission may be proved otherwise.
[10] A contract may be rescinded by a subsequently executed instrument or agreement inconsistent with the first. If the first agreement and the substituted instrument cannot stand together the latter will thereby effect a rescission of the first. An antenuptial contract ordinarily limits the property right or distributive share of a spouse in the estate of the deceased spouse. A subsequently executed instrument destroying the limitation or expressly restoring the right to the distributive share necessarily effects a rescission of the antenuptial contract in that respect. An express statement to that effect is not necessary. Whether the paper signed in the fall of 1940 was a contract or a declaration of O'Dell accepted and acquiesced in by the *Page 458
plaintiff, all the attending circumstances and surrounding conditions point to their executed intention to rescind or modify the antenuptial agreement so far as it deprived her of her widow's share in his property. If that was their purpose it is immaterial what you call it. Speaking of a contract dissolving a prior contract, the court, in Reit v. Driesen, 212 Iowa 1011, 1017, 237 N.W. 325, 327, said:
"Whether it be termed a substitution, waiver, abrogation, merger, abandonment, novation or rescission of the first contract, the arrangement of March 16, 1921, constituted a new contract in which the previous contract was merged and by which it was discharged."
"An agreement, when changed by the mutual consent of the parties, becomes a new agreement. It takes the place of the old. A contract may be abrogated in part, and stand as to the residue." Hawkeye Clay Works v. Globe Rutgers F. Ins. Co.,202 Iowa 1270, 1274, 211 N.W. 860, 863.
The propositions and principles of law stated above have the uniform sanction of the courts.
"Persons competent to contract can as validly agree to rescind a contract already made as they could agree to make it originally. * * * Moreover, a contract may be discharged by conduct as well as by words." 12 Am. Jur., Contracts, section 431.
"A contract need not be rescinded by an express agreement to that effect. The rule is well settled that the parties to a contract may rescind it by making a new contract inconsistent therewith. If the parties to a contract make a new and independent agreement concerning the same matter and the terms of the latter are so inconsistent with those of the former that they cannot stand together, the latter may be construed to discharge the former." 12 Am. Jur., Contracts, section 433.
See, also, 17 C.J.S., Contracts, section 395; 6 R.C.L., Contracts, section 307. *Page 459
"As a contract is the result of an agreement, so an agreement may put an end to a contract. Therefore, a contract may be discharged or abrogated at any time before the performance is due by a new agreement with the effect of altering the terms of the original agreement or of rescinding it altogether * * *." 17 C.J.S., Contracts, section 394.
"Form of Agreement. * * * The cancellation, abandonment, or rescission of a written contract may not only be written but it may also be oral or by implied agreement, which may be shown by the acts of the parties and the surrounding circumstances." 17 C.J.S., Contracts, section 388.
"Whether or not such an executory contract has been rescinded by mutual consent is a question of fact which need not be proved by express terms, but may be inferred from the attendant circumstances and the conduct of the parties. 6 Williston on Contracts, revised edition, sec. 1826." Lewis v. Marsters, 139 Me. 17, 22, 26 A.2d 649, 651.
In Gordon v. Munn, supra, 87 Kan. 624, 635, 125 P. 1, 5, Ann. Cas. 1914A, 783, the court said:
"In determining whether the antenuptial contract was canceled or annulled by mutual agreement * * * all the circumstances of the situation tending to prove the intention of the parties should be considered. * * * the age and enfeebled condition of the husband, the care and attention of the wife, their feelings toward each other, the disposition made of the instrument, and every other fact having a natural relevancy to the inquiry."
On this appeal the circumstances and the reasonable inferences, without exception, point definitely to the intention of these parties — particularly the husband — to modify or rescind the antenuptial contract and restore to the wife her right to a widow's distributive share: her much greater service in the operation of the farm than he, her devoted care of him in his helpless condition for so many years, the hostile attitude of Wayne and his wife to her, his feeling that the children would take advantage of her, his progressive physical decline and the *Page 460
likelihood that she would survive him, his dissatisfaction with conditions in the home and the hardship of the prenuptial agreement, his expressed desire to destroy the agreement, his feeling that Wayne had removed it from the box with an ulterior purpose, the porch incident, his expressed intention to restore to his wife her dower interest, his trip to Turner to have a paper drawn to carry out this intention, the execution of a paper apparently satisfactory to him and his wife. The reappearance of the antenuptial agreement and the disappearance of the paper restoring to his wife her widow's share confirm the correctness of his conclusion that there were those who were interested in beating her out of that share. It is significant that the strong box was in the possession of Albert for some time before the death of James O'Dell.
[11] V. The defendants in their printed argument, referring to the paper executed in Burger's store, state:
"* * * no other contract was produced at the trial. If there had been such a contract there would have been no consideration therefor, and the decedent could not have made a contract with his wife under the circumstances."
The court also stated there was no consideration for the agreement.
Any dissolution or cancellation of a prenuptial agreement or of any other executory contract may be effected by the mutual consent or agreement of the parties to do so. Lawful cause is not necessary. No new consideration is needed. The mutual release from the old contract is adequate consideration. The principle is thus stated in 17 C.J.S., Contracts, section 391:
"Consideration. While a contract remains executory on both sides, an agreement to annul on one side is a sufficient consideration for the agreement to annul on the other, but if the contract has been executed on one side, other consideration is necessary."
While the prenuptial agreement does not mention the intended marriage of the parties, that was the reason for the contract. The marriage was consummated. But the provisions of *Page 461
the agreement respecting mutual renunciation of property rights in the estate of the other were wholly executory while both of them lived. And during that time they might mutually consent to alter or abrogate those provisions as they saw fit.
O'Dell had told Mrs. Pickens that he was not satisfied with conditions and that he wished to go to Mount Ayr to change his will — to make a different disposition of his property after death than he had made. On the day of the quarrel on the porch, but later in the day, he searched for the prenuptial contract and did not find it in the "strong box" where he kept his papers. The will was no doubt in the box. But he was not looking for the will. He was trying to find the prenuptial agreement. What he intended to do with it we do not know. Wayne denied his accusation of having taken it. Not knowing what had become of the agreement, and desiring to change it or rescind it to give a widow's share to his wife, they went to Turner with the clearly evident purpose of having such an instrument drawn.
Defendants and the trial court were in error in stating that this agreement was without consideration and therefore was invalid. It was not without consideration. It was a new contract taking the place of the old agreement — a substitution for it — and it required no other or new consideration. This court has so held. In Strahn v. Johnson, 197 Iowa 1324, 1332, 196 N.W. 731, 734, the parties had entered into a contract for the exchange of real estate. While it was still executory, and before either party had parted with his property, the contract was abandoned, so the defendant contended, and a new contract was entered into by them. Plaintiff sued defendant for damages for an alleged breach of the first contract. There was a verdict and judgment for the defendant. Plaintiff, on appeal, assigned error for failure of the trial court to instruct that there was no consideration for the second contract. In affirming and holding there was no error, this court said:
"It seems to us that the court was not in error in instructing the jury, in effect, that the parties had a right to abandon by agreement, on January 31st, when they met to deal, the *Page 462
unperformed contract of January 10th, in any manner that they might agree upon. The contract of January 10th was executory only, and while it was executory, no new consideration was required to release the same, or for the substituted contract of January 31st."
Decisions of this court were cited in support of the holding.
The same principle of law was stated in Richards v. Hellen
Son, 153 Iowa 66, 71, 72, 133 N.W. 393, 395, thus:
"It is apparent that the contract on which plaintiff relies is based upon a good consideration; that is to say, it was executed as a substitute for prior ones, and the prior agreements were abandoned and rescinded. That this is a sufficient consideration is hornbook law. See Page on Contracts, vol. 3, section 1344; Bishop on Contracts, sections 813-816."
See, also, Vande Stouwe v. Bankers L. Co., supra, 218 Iowa 1182, 1197, 254 N.W. 790, 798, where the court said:
"That the contract under which such future rights and liabilities will arise may be canceled by a new agreement is equally certain. 13 C.J., page 600, section 621 et seq. In such case there is ample consideration for the new agreement even though there be perfect accord between the parties to the old contract."
Other authorities and decisions support the principle above stated. In Wright v. Fischer, 24 Tenn. App. 650, 658,148 S.W.2d 49, 53, the court said:
"Ordinarily, the parties to a contract of any kind may at any time rescind it by their mutual consent and agreement (2 Black on Rescission and Cancellation (1st Ed.), 1231, sec. 521), or change or modify the terms of their contract without rescinding it entirely, if the rights of third parties have not intervened. And if the parties agree not merely to rescind the existing contract, but make a new contract with reference to the same subject-matter, the new contract taking the place of the old, the substitution of the one for the other is a sufficient *Page 463
consideration to support the new agreement. 2 Black on Rescission and Cancellation (1st Ed.), 1235, sec. 523."
In Stoddard Son v. Village of North Troy, 102 Vt. 462, 468, 150 A. 148, 150, the court said:
"The parties might, therefore, at any time before a breach of it, by a new contract not in writing, waive, dissolve, or annul the former agreement, or in any manner add to, subtract from, or vary, or qualify its terms, and thus make a new contract. Powers v. Rutland R.R. Co., 88 Vt. 376, 394, 395, 92 A. 463, and cases cited. Since the original contract was executory, and no breach had as yet occurred, no new consideration was required. Hill et al. v. Scott, 101 Vt. 356, 361, 143 A. 276."
In Hill v. Scott, just cited, numerous cases are cited in support.
The court erred in holding that the writing executed in 1940 was without consideration.
[12] VI. After stating that there was no consideration for this contract, the court said and held:
"She was the wife of James O'Dell and she could not contract with him in regard to her statutory right in his property."
The court did not specify what statute or Code section was referred to. We assume it was section 10447, Code, 1939 (section597.2, Code, 1946). If so, the court was in error. This court, in Fisher v. Koontz, 110 Iowa 498, 502, 80 N.W. 551, held that said section (3154 of the 1897 Code) did not prohibit a husband and wife from making a postnuptial contract canceling an antenuptial agreement and restoring her marital property rights, which she had relinquished.
VII. Plaintiff vigorously insists that she established the allegation of count one of her petition that the antenuptial agreement was not executed until after the marriage of herself and O'Dell and was for that reason of no force and effect. In view of our conclusion that plaintiff established the allegations of count two, thereby requiring a reversal of the decree of the district court and a decree for the plaintiff, we do not find it *Page 464
necessary to discuss or determine the aforesaid issue in count one.
[13] VIII. The trial court held that the facts presented in the record were not sufficient to enable it to pass upon the merits of plaintiff's allegations and prayer for a decree awarding her the sum of $2,400 as a widow's allowance for the period of twelve months after her husband's death, and therefore did not allow the claim. The value of the estate of the deceased, or of what plaintiff's needs may be, and the proceedings in the estate with respect to any allowance are not before us. It is our conclusion that the ruling of the trial court in the matter was proper. However, neither that judgment nor our opinion herein will prejudice or be a bar to any appropriate proceeding available to plaintiff with respect to such an allowance.
[14] IX. When plaintiff began testifying as her first witness objections to questions asked her were, upon the insistence of defendants' attorneys, ruled upon by the court, and when the objections were sustained the witness was not permitted to answer, and plaintiff's attorneys were then required to make an offer of proof of what the witness would have answered. This colloquy took place between court and counsel respecting the procedure:
"Mr. Stuart: The thought I had in mind is whether or not you rule on the objections as they are made. The Court: I am required, as I understand the law, to rule if someone insists on a ruling. * * * Mr. Stuart: I wasn't asking that the general objection be applied, but my understanding was in equity that the practice, at least, was for the Court to accept the testimony subject to the objection made. The Court: That is often done, in fact, most of the cases I have tried in equity in this district have been tried in that way, but I have always held to the opinion that if counsel insisted on a ruling he had a right to have the court rule."
After an answer had been stricken, counsel for plaintiff said:
"I want to ask a question. Would it be agreeable to the Court and counsel that when the objection is sustained, the *Page 465
witness be permitted to go ahead and make her answer, which would be our offer — Mr. Wilson: It will certainly not. Mr. Stuart: Offer to prove. I never saw this before. * * * I want to make my record so the Supreme Court can see it. * * * The Court: You can offer to make the proof and if the Court denies you offer you can proceed."
That was the way the trial proceeded and much of plaintiff's testimony went into the record as an offer of proof.
The procedure followed was not in accord with usual equity practice in Iowa. See Rankin v. Schiereck, 166 Iowa 10, 16, 147 N.W. 180, 182, where the court said:
"The proceeding is in equity. The rules of evidence in such cases are such that the trial judge, while noting objections, may not exclude offered testimony."
In Donaldson v. Smith, 122 Iowa 388, 390, 391, 98 N.W. 138, 139, the court said:
"The next assignment of error relates to rulings said to have been made on the admission of evidence. The evidence was all taken subject to objection, as it should have been, for the case was tried in equity; hence there is no ruling to review."
In Baadte v. Walgenbach, 185 Iowa 773, 780, 781, 171 N.W. 146, 148, the court said:
"The trial seems to have proceeded after the manner and practice which have become usual in equity cases in this jurisdiction: that is, while counsel on either side exercised to the limit their right to make all conceivable objections to each item of evidence, and their objections were duly noted in the record, the court did not rule thereon at the time, nor were such rulings demanded or entered at the close of the trial."
This is the practice followed in the federal courts, and in other jurisdictions generally. 30 C.J.S., Equity, section 457; Rule 43 (c) of Federal Rules of Civil Procedure, 28 U.S.C. section 723c; Unkle v. Wills, 8 Cir., Okla., 281 F. 29, 34. The purpose is to preserve a complete record of the evidence for the trial and the appellate courts, leaving to them the rejection *Page 466
of inadmissible testimony in deciding the issues. In the review de novo the appellate court, if it finds the trial court has erred, may then decide the case on the record made without a remand.
Plaintiff does not ask that the cause be sent back for a retrial. Nor should she be put to that delay and expense. Some of her testimony was admitted and later stricken, but much of it went in by offer of proof. Since the defendants insisted that this procedure be followed, and the court improperly acceded to the demand, the testimony introduced by plaintiff and the testimony in the record by offer of proof will be considered as the record of her evidence.
The defendants are not entitled to a remand for new trial. Peoples Nat. Bk. v. Russel, 196 Iowa 401, 406, 407, 194 N.W. 247.
A careful study of the record convinces the court that the equities are all with the plaintiff and appeal strongly in her favor. As said by Justice Evans, in Garman v. Wettengel, 199 Iowa 1150, 1151, 1155, 203 N.W. 266, 268:
"Needless, perhaps, to say that the substantial equity, or want thereof, which supports the claim of plaintiff is always an influential consideration. * * * The equities behind the plaintiff's claim are strong enough to warrant their acceptance as corroboration of the direct testimony in the record, in support of such claim."
It is our conclusion that the alleged prenuptial contract should be set aside and held of no force and effect, and that the plaintiff is entitled to and should be awarded her full distributive share under the statutes of Iowa, as the widow of the deceased, James O'Dell, as of the date of his death. The decree of the district court is therefore reversed, except as to the disallowance of the widow's allowance and the taxing of costs, and the cause is remanded with directions to tax all costs to the defendants and to enter judgment and decree in conformity herewith. — Reversed and remanded.
WENNERSTRUM, C.J., and GARFIELD, HAYS, and OLIVER, JJ., concur.
SMITH, HALE, MULRONEY, and MANTZ, JJ., dissent. *Page 467
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/3432568/
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Appellant Jennie C. Layman is the administratrix of the estate of Daniel W. Layman, her deceased husband. The Court allowed her $3,000.00 for the support of herself and three minor children for one year. The appellee filed a claim which was allowed as a claim of the fourth class. Nothing has been paid thereon. The estate consisted in part of various tracts of real property. Issues having been joined on the petition of appellee to subject the property to the payment of her claim by the administratrix as such and on her own behalf, a referee was appointed by the court to take the testimony and report his finding of facts. The testimony was taken and a report of the referee's findings duly made and filed in the proper office. The referee found that the allowance made to appellant as widow had not been paid; that she had advanced expenses *Page 116
in the administration of the estate in excess of the property and income received by her; and that she was entitled to $983.33 as her distributive share in certain real property of the estate which had been sold. The total sum found by the referee to be due appellant against the estate, which was composed of the items mentioned, was $4,194.73. The report of the referee was approved by the court and a decree confirming the respective claims of appellee and appellant was signed by the court and duly entered. The decree so entered provided that the claims of the respective parties should be paid out of the assets of the estate pro rata.
The defendant Jennie C. Layman appealed from the finding and judgment of the court in so far as the same required her to sharepro rata with the appellee.
[1] The abstract of appellant does not contain the evidence, but does set out the pleadings, the report of the referee in full, the decree of the court, and some other matters of record. Appellee filed an amendment to appellant's abstract, setting out in part the evidence taken before the referee. She has also filed a motion in this court to dismiss or affirm the appeal upon the ground that the case is triable de novo and, as the evidence is not before us, this cannot be had. In view of the single proposition relied upon by appellant for reversal, we think the motion should be overruled. The only question before the court for decision involves the provision of the decree which requires the claimants to share pro rata in the assets of the estate. The decree is based upon the findings and report of the referee, and the only claim asserted by appellant is that the court committed error in ordering the claims paid pro rata instead of in the order provided by law for the payment thereof. The right of appellee to a de novo review is, of course, conceded, but the ruling complained of is not based upon the evidence in detail, but upon the findings and report of the referee. Everything material to the decision of the proposition relied upon for reversal is before the court.
[2] The provision of the decree requiring the respective claimants to share pro rata cannot be sustained. Section 11969 of the Code of 1931 provides that charges for the last sickness and death of the deceased shall first be paid, and that any allowance made by the court for the maintenance of the widow and minor children shall next be paid. Appellee is a claimant of the *Page 117
fourth class. Her claim was filed more than twelve months after the executrix was appointed. Appellant was entitled to have her claim paid in full before any part of appellee's fourth-class claim should be paid. Elliott v. D.M. Nat. Bank, 209 Iowa 1258; In re Estate of Harsh, 207 Iowa 84; Section 11969, Code, 1931.
It follows that the decree, in so far as it requires the respective claimants to share pro rata, is reversed, and the cause remanded, with directions that a decree be entered in harmony with this opinion. — Reversed.
WAGNER, C.J., and De GRAFF, FAVILLE, and ALBERT, JJ., concur.
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01-03-2023
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07-05-2016
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https://www.courtlistener.com/api/rest/v3/opinions/1380309/
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354 F. Supp. 1048 (1973)
Thomas BRANHAM, Plaintiff,
v.
MATERIAL SYSTEMS CORPORATION and Alan R. Novak, Defendants, and Third-Party Plaintiffs,
v.
Robert O. FIGUEREDO and Insco, S. A., Third-Party Defendants.
No. 71-1640-Civ.
United States District Court, S. D. Florida, Miami Division.
January 31, 1973.
*1049 *1050 *1051 Fleming, O'Bryan & Fleming, Fort Lauderdale, Fla. (John S. Neely, Jr., Fort Lauderdale, Fla., of counsel), for plaintiff.
Cassel & Benjamin, Miami, Fla. (Julian R. Benjamin, Miami, Fla., of counsel) and Stroock & Stroock & Lavan, New York City (Gary J. Greenberg, New York City, of counsel), for defendants and third-party plaintiffs.
Vandroff & Mandell, Miami, Fla. (Richard J. Mandell, Miami, Fla., of counsel), for third-party defendants.
MEMORANDUM OF FINDINGS OF FACT AND CONCLUSIONS OF LAW AND ORDER
JAMES LAWRENCE KING, District Judge.
By his complaint, plaintiff Thomas Branham charges defendants Material Systems Corporation ("MSC") and the chairman of its board of directors, Alan R. Novak, with fraud in violation of Section 17(a) of the Securities Act of 1933, 15 U.S.C. § 77q(a), Section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), and Rule 10b-5 promulgated thereunder by the Securities and Exchange Commission, 17 C.F.R. § 240.10b-5, and the common law of the State of Florida in connection with an alleged purchase of MSC stock in March 1971. After the court denied a motion to dismiss, defendants answered denying liability, and, within the time allowed by Rule 14(a), commenced a third-party action against Robert O. Figueredo and Insco, S.A. ("Insco"), a Panamanian corporation, seeking indemnification and contribution in the event plaintiff should prevail in the action-in-chief. Third-party defendants answered denying liability and interposed a counterclaim against defendants. After discovery, defendants filed a motion for summary judgment which the court denied. The matter then came on for trial between January 15-17, 1973, before the court sitting without a jury. This memorandum constitutes the court's findings of fact and conclusions of law under Rule 52(a).
The basic facts giving rise to plaintiff's claim of fraud are undisputed. On August 18, 1970, MSC entered into a contract with Figueredo which provided that he or a South American corporation to be formed by him and/or "a limited group" of "close associates" would purchase 38,461 shares of MSC common stock for $250,000, or $6.50 per share, by no later than September 7, 1970. Thereafter, Figueredo and his corporation or group had the option of purchasing an additional 236,539 shares of MSC common stock in three installments between September 30 and November 30, 1970 at prices ranging from $7.25 per share to $5.52 per share. Full performance by Figueredo of all options would also have resulted in acquisition of a long-term, exclusive license to produce and sell MSC's composite materials building system and related components throughout Latin America and the Spanish-speaking areas of the Caribbean. Sometime prior to September 7, 1970, MSC received $100,000 under the contract from Figueredo's group, but no additional payments were made and MSC did not issue any of its stock to Figueredo or any member of his group.
Beginning sometime in either December 1970 or January 1971, Figueredo had a series of discussions with plaintiff, a personal acquaintance and former business colleague in Gramco International, S.A. ("Gramco"), concerning, among other things, the purchase by Branham of MSC's stock. Branham visited *1052 the MSC plant in California in early February 1971, and, thereafter, between February 24 and March 3, he and Figueredo entered into a series of five letter agreements which provided, in pertinent part, that Figueredo would seek to purchase from MSC on behalf of Branham 13,000 shares of MSC common stock for an aggregate price of $113,880, or $8.76 per share, payable to Insco. On March 4, 1971, Branham paid Figueredo $113,880; the latter thereafter wired only $84,500 to MSC's bank in California. Figueredo had written to Alan Novak on February 26, 1971, indicating that $84,500 would be forthcoming and that 13,000 shares of stock should be issued in the name of Thomas Branham. That letter, as modified by a subsequent undated letter, stated that in the event the request to issue shares was not accepted MSC was to return the funds to Figueredo's account at the First National Bank of Miami, the same account from which the money was provided.
On March 26, 1971, the MSC board of directors met and voted to reject Figueredo's request that 13,000 shares be issued to plaintiff. On or about April 20, 1971, the full $84,500 was returned by MSC to Figueredo's bank account. On or about April 26, 1971, Figueredo returned only $78,840 to Branham; $35,040 the difference between the $113,880 Figueredo received and the $78,840 he returned was not repaid to Branham by Figueredo and constitutes the alleged damages suffered by plaintiff.
Plaintiff's complaint charges defendants both with active fraud and with aiding and abetting Figueredo in the commission of a fraud in connection with the alleged March 4 "purchase" of MSC's securities. As required under Rule 9(b), the complaint alleges that Figueredo and defendants defrauded plaintiff by making the following material misrepresentations:
"6. . . . Defendants and FIGUEREDO represented to Plaintiff that MSC would sell shares of MSC common stock to FIGUEREDO or to such persons as FIGUEREDO might designate at the same price FIGUEREDO would pay.
* * * * * *
8. . . . FIGUEREDO represented to Plaintiff that MSC required that FIGUEREDO or his designees pay $8.76 per share.
9. On information and belief, Defendants never told FIGUEREDO that he or his designees had to pay $8.76 per share, and in fact had led FIGUEREDO to believe that he or his designees had to pay only $6.50 per share.
10. . . . Defendants, negligently, recklessly or deliberately, represented to Plaintiff, expressly or by reasonable implication from their course of conduct, that FIGUEREDO or his designees had to pay $8.76 per share and omitted to state to Plaintiff that FIGUEREDO or his designees had to pay only $6.50 per share."
Figueredo is alleged to have acted as MSC's agent in the transaction at issue, and plaintiff asks the court to hold defendants responsible for any unlawful acts which Figueredo may have committed.
The complaint further alleges that sometime after March 4, but prior to the March 26 board meeting, Novak was informed by plaintiff that he had tendered Figueredo $113,880 rather than the $84,500 MSC had received. Plaintiff alleges that Novak told him that Figueredo or Insco had $100,000 on deposit with MSC and that, if MSC did not sell any shares of its stock to plaintiff, MSC would refund Branham's money by returning the $84,500 and paying plaintiff $29,380 out of the $100,000 fund. Plaintiff claims that he relied on this representation, as well as on the alleged representation concerning the price per share Figueredo had to pay, and as a consequence was damaged when Figueredo returned only $78,840 and converted the balance, $35,040, to his own use.
During the course of the three-day trial, all of the principals testified *1053 Messrs. Branham, Figueredo and Novak, as well as Michael Umansky, counsel to MSC. The court therefore had the opportunity to hear and observe each of said witnesses and to evaluate their credibility in the context of an adversary trial proceeding. The court has also read the 42 documentary exhibits and those portions of the depositions introduced into evidence.
The court finds that the August 18, 1970 contract between Figueredo and MSC was breached by Figueredo on or about September 7, 1970, when he failed to tender the full $250,000 due under the contract. Defendants so informed Figueredo and the only known member of his group, Ramon Piementel Hardy ("Piementel"). When a Venezuelan investment counselor wrote to Novak on October 30, 1970 inquiring about the relationship between Figueredo, Material Systems Corporation, N.V. (a company Figueredo was seeking to promote in Venezuela) and MSC, Novak responded by stating that Figueredo had failed to fulfill his obligations under the August 18 contract and therefore "neither he nor any company he may have promoted, has any license from us or other rights with respect to our company."
Figueredo was not authorized to act on behalf of MSC as its agent in the sale of MSC stock. There is no evidence in the record to support a finding that defendants, by their conduct or words, held Figueredo out to plaintiff as their agent.[1]See generally Restatement 2d, Agency §§ 27, 125, 126. Plaintiff even testified that he was aware of the fact that Figueredo was in breach of the August 18 agreement prior to his contracting with Figueredo for the purchase of MSC shares. As plaintiff well knew, Figueredo was, in all of his dealings with Branham, acting solely on behalf of himself and/or Insco.
To prevail, plaintiff must therefore have proved by a preponderance of the credible evidence that defendants either made material misrepresentations directly to him or, being duty bound to disclose material information to him, remained silent. See Cochran v. Channing Corp., 211 F. Supp. 239, 243 (S.D.N.Y. 1962); Barnett v. Anaconda Co., 238 F. Supp. 766, 775 (S.D.N.Y.1965); West v. Zurhorst, 280 F. Supp. 574, 580 (S.D.N. Y.1967). The court concludes that plaintiff failed to meet this burden.
The court finds that the only contact between plaintiff and defendants or their representatives, specifically including Michael Umansky, prior to March 26, 1971 was Branham's visit to the MSC plant in California and, at most, two telephone calls during which Branham discussed the general business and financial position of MSC with Umansky and possibly Novak. The visit to the California facility was inconsequential in view of the fact that MSC was at that time pursuing a policy of encouraging visitors to view its first prototype home built of composite materials. Indeed, Novak testified that over 5,000 persons had visited the California facility. In addition, Branham testified that no false representations were made and no material information was withheld at that time. The telephone conversations constituted no more than introductory, general discussions with an individual identified as a Figueredo associate.
In these circumstances, there was no relationship subsisting between plaintiff and defendants which imposed upon the latter a duty of full disclosure to the former. As far as defendants were concerned, Branham was a stranger an individual whose dealings were with Figueredo and whose investment intentions were known only to Figueredo. To impose the statutory duty of full *1054 disclosure upon defendants on the basis of the minimal, nonsubstantive contacts here demonstrated would have the effect of unduly hampering and restricting the necessary and salubrious pursuit of equity investment by all privately held corporations.[2]
While the federal securities statutes have substituted a full disclosure approach for that of caveat emptor, SEC v. Capital Gains Research Bureau, 375 U.S. 180, 186, 84 S. Ct. 275, 11 L. Ed. 2d 237 (1963); Affiliated Ute Citizens v. United States, 406 U.S. 128, 151, 92 S. Ct. 1456, 31 L. Ed. 2d 741 (1972); Herpich v. Wallace, supra, 430 F.2d at 801, they do not impose an absolute liability standard. Full disclosure is only required where the law imposes a duty to speak, and that duty exists only in circumstances which indicate an investment or fiduciary relationship between the seller and buyer, or knowledge, actual or implied, on the part of the seller that unless he speaks the buyer may act to his detriment. See Cochran v. Channing Corp., supra; Rothschild v. Teledyne, Inc., 328 F. Supp. 1054, 1056 (N.D.Ill. 1971); Affiliated Ute Citizens v. United States, supra, 406 U.S. at 153, 92 S. Ct. 1456, 31 L. Ed. 2d 741. Here, there was no relationship between defendants and plaintiff, and defendants had no knowledge, actual or implied, concerning the nature of the Branham-Figueredo negotiations and contracts.
Branham testified that he informed both Novak and Umansky prior to tendering the $113,880 to Figueredo on March 4, and again between March 4 and the MSC board meeting on March 26, that he had paid $113,880 to Figueredo, or $8.76 per share, for 13,000 shares of MSC stock. He stated that prior to March 4 he specifically asked Novak and Umansky to confirm the $8.76 price as opposed to the $6.50 price stipulated in the August 18 contract, and that thereafter he sought confirmation from them of the receipt of $113,880. Plaintiff stated that prior to March 4 he received the assurances he sought from Novak and Umansky concerning the $8.76 price, and, thereafter, while he was told that only $84,500 had been received, he was assured that the full $113,880 would be returned if the shares were not issued by dipping into the $100,000 sum Figueredo had deposited with MSC. Novak and Umansky denied that such conversations took place. They both testified that they had no contact with Branham concerning any of the details of the tender of $84,500 for 13,000 shares until after the board's March 26 rejection of the offer. They testified that, save for what information was provided by Figueredo's instruction letters, they had no knowledge concerning what Figueredo was charging Branham, how much Branham had tendered to Figueredo, the nature of the contractual arrangements between Branham and Figueredo, nor, indeed, who supplied the $84,500. They both testified that not until sometime after March 26, when they spoke with both Branham and Figueredo to inform them of the board's *1055 action, were they told any of the specifics of the Branham-Figueredo transactions.
Plaintiff's testimony concerning these matters was not consistent, was somewhat at variance from his testimony given on a pre-trial deposition, and was contradicted by certain documentary exhibits and the reasonable inferences to be drawn therefrom. On the other hand, the court was impressed with the honesty, forthrightness and candor of Alan Novak and Michael Umansky. Their testimony was consistent and was supported by the documentary exhibits. The court finds that they testified truthfully. Consequently, the court finds that neither Novak nor Umansky had any conversations with Branham on the subjects of the price per share, the aggregate amount received by Figueredo, the amount received by MSC, the nature of the contractual arrangements between Branham and Figueredo, or the $100,000 fund prior to the March 26 board meeting. The court finds that defendants were first informed of some of the facts concerning these matters in early April when Novak and Umansky spoke with Branham and Figueredo about the board's decision. Indeed, it was not until some time after May 3, 1971, when Branham wrote Umansky enclosing copies of the letter agreements executed between himself and Figueredo, that defendants were apprised of the full details of the Branham-Figueredo relationship. Until that time defendants had not seen or even been aware of the existence of those contracts. It is the court's conclusion, therefore, that defendants neither made direct misrepresentations to plaintiff, nor deceived him by failing to disclose material information which they were duty bound to reveal.[3]
Under the law, plaintiff must prove not only a false representation or omission of information, but that that which was misrepresented or withheld was material i. e., that had plaintiff known the truth he would not have acted in the fashion he did. As explained by the Second Circuit, the basic test of "materiality" is "whether `a reasonable man would attach importance [to the fact misrepresented] in determining his choice of action in the transaction in question.'" List v. Fashion Park, Inc., 340 F.2d 457, 462, cert. denied sub nom. List v. Lerner, 382 U.S. 811, 86 S. Ct. 23, 15 L. Ed. 2d 60 (1965). Accord, Affiliated Ute Citizens v. United States, supra, 406 U.S. at 153-154, 92 S. Ct. 1456, 31 L. Ed. 2d 741; Lehigh Valley Trust Co. v. Central National Bank, 409 F.2d 989, 993 (5th Cir. 1969); Mitchell v. Texas Gulf Sulphur Co., 446 F.2d 90, 97 (10th Cir. 1971), cert. denied, 404 U.S. 1004, 92 S. Ct. 564, 30 L. Ed. 2d 558 (1971) and sub nom. Reynolds v. Texas Gulf Sulphur Co., 405 U.S. 918, 92 S. Ct. 943, 30 L. Ed. 2d 788 (1972). The court must determine "whether the plaintiff would have been influenced to act differently than he did act if the defendant[s] had disclosed to him the undisclosed fact." List v. Fashion Park, Inc., supra, 340 F.2d at 463.
In this regard too, plaintiff failed to sustain his burden of proof. The documentary exhibits, particularly Plaintiff's Exhibit 14, indicate that in the event MSC turned down the request to purchase 13,000 shares, Figueredo could retain the full $113,880 so long as he provided Branham with 13,000 shares *1056 of MSC's stock from his own "account" with MSC. The court finds that Branham was aware that Figueredo was paying only $6.50 per share, that Branham knew others were paying less than $6.50, that Branham was willing to pay $8.76 per share based on his own investment judgment as to the worth of MSC which judgment was based on full information untainted by any fraudulent misrepresentation or omission and that Branham's only objection to the difference between the $6.50 and $8.76 prices concerned the question of Figueredo's "morality". (Branham Deposition p. 92.) As such, even assuming the truth of Branham's allegations of deception, the court concludes that the price differential was not a material fact that if fully disclosed would have influenced Branham to have acted differently. See List v. Fashion Park, Inc., supra, 340 F.2d at 464.
A further prerequisite to recovery by plaintiff is that he prove that his damage was caused by his reliance on the alleged deception. The test of reliance is whether the alleged deception was a substantial factor in determining the course of conduct which resulted in plaintiff's loss. The reason for this requirement "is to certify that the conduct of the defendant actually caused the plaintiff's injury." List v. Fashion Park, Inc. supra, 340 F.2d at 462. See Johns Hopkins University v. Hutton, 326 F. Supp. 250, 258-259 and n. 11 (D.Md. 1971).
Defendants raised, as an affirmative defense, the contention that plaintiff failed to act with the due diligence to have been expected of a reasonable purchaser buying under the circumstances here present. See Clement A. Evans & Co. v. McAlpine, 434 F.2d 100 (5th Cir. 1970), cert. denied sub nom. Clement A. Evans & Co. v. A. M. Kidder & Co., 402 U.S. 988, 91 S. Ct. 1660, 29 L. Ed. 2d 153 (1971); City National Bank v. Vanderboom, 422 F.2d 221, 230-231 (8th Cir.), cert. denied, 399 U.S. 905, 90 S. Ct. 2196, 26 L. Ed. 2d 560 (1970). Defendants contend that, as a consequence, plaintiff's damages cannot be said to have been caused by defendants' conduct.
The requirement that an investor act reasonably and exercise due care in light of all of the facts available to him "`imposes a duty of reasonable investigation, thereby limiting the class of investors who will be protected under 10b-5(2) to concientious buyers and sellers in good faith.'" Clement A. Evans & Co. v. McAlpine, supra, 434 F.2d at 104, quoting with approval City National Bank v. Vanderboom, supra, 422 F.2d at 230 n. 10. See also Mitchell v. Texas Gulf Sulphur Co., supra, 446 F.2d at 103; Kohler v. Kohler Co., 319 F.2d 634, 641-642 (7th Cir. 1963); Carlisle v. LTV Electrosystems, Inc., 54 F.R.D. 237, 239 (N.D.Tex.1972). The court concludes that plaintiff has not met his burden of proof as to causation because his reliance was unreasonable in that he failed to make a careful and diligent effort to inquire into and discover the true facts concerning the alleged fraud.
Plaintiff knew that the August 18 contract between MSC and Figueredo had been breached, yet he dealt exclusively with Figueredo, making no effort to inquire into the facts concerning MSC's relationship with Figueredo. Although the August 18 contract stipulated that Figueredo and his group would only be paying $6.50 per share for the initial acquisition of 38,461 shares, and although a February 26 contract between Figueredo and Branham (Plaintiff's Exhibit 14) confirmed to plaintiff the fact that Figueredo was only paying $6.50 per share, Branham never consulted with Novak or Umansky on the discrepancy between $8.76 and $6.50. Although Branham's objective was to purchase shares of MSC, and although he was aware of the fact that Figueredo and Insco were in financial trouble because of the collapse of Gramco, he nonetheless provided Figueredo rather than MSC with the $113,880 and never sought, through either the banks or Novak or Umansky, to confirm the amount forwarded to MSC. Although Branham saw the instruction letters sent to MSC *1057 and noticed the absence of any statement concerning the price per share or the aggregate amount to be sent to MSC, he neither took steps to require Figueredo to confirm that he was sending the full $113,880 nor asked Novak or Umansky to confirm the amount MSC had received. Although he entered into five different contracts with Figueredo, signed an investment letter, visited the MSC plant in California and was about to make the largest single investment of his life, plaintiff, who is not an inexperienced investor, did not consult with an investment adviser, an attorney or with any representative of MSC. Although Branham was aware of the fact that MSC's board might turn down the request to purchase 13,000 shares, he took no steps to insure that Figueredo would return the full amount tendered or would provide 13,000 shares of MSC's stock from his own "account". Although Branham agreed to allow Figueredo to keep the full $113,880 in return for giving him 13,000 MSC shares from his (Figueredo's) own account, Branham never checked with MSC to ascertain if Figueredo had such an account. (Had Branham done so he would have learned that such was not the case.)
In the end, plaintiff's loss was the result of Figueredo's breach of his promise to return either the full $113,880 or 13,000 of his own MSC shares (which he never had) in the event that the MSC board turned down the proposal to issue 13,000 shares directly to Branham. MSC returned the full $84,500 it had received pursuant to the terms of the instruction letters. Defendants' conduct was proper and reasonable in every respect. Plaintiff's conduct was anything but reasonable and diligent under the circumstances of this case, and his loss can only be attributed to his own failure to exercise due care.
Defendants advance the contention that plaintiff has failed to establish his standing under §§ 17(a) and 10(b) as a purchaser of securities. See Herpich v. Wallace, supra, 430 F.2d at 806; Rekant v. Desser, 425 F.2d 872, 877 (5th Cir. 1970). There was, of course, no consummated purchase, but rather a tender of funds and a request that the money be accepted and 13,000 shares be issued to plaintiff. Defendants contend that plaintiff does not have standing as an "aborted purchaser" because there was no subsisting contractual relationship between plaintiff and defendants, made either directly or through the agency of Figueredo, under which Branham sought to effect a purchase which defendants deterred and deflected by their fraud. See Mount Clemens Industries, Inc. v. Bell, 464 F.2d 339, 345-346 and n. 11 (9th Cir. 1972); Commerce Reporting Corp. v. Puretec, Inc., 290 F. Supp. 715, 718-719 (S.D.N.Y.1968). While there is much to be said in support of defendants' position, since the court's findings and conclusions preclude plaintiff from recovering a judgment, it is not necessary that this issue be resolved in this case.[4]
Since defendants have prevailed in the main action, their third-party claim for indemnification and contribution is moot. The court must, however, decide third-party defendants' counterclaim against defendants.
It became clear, during June 1971, that the $100,000 initially tendered by Figueredo was put up entirely by Piementel, one of Figueredo's Venezuelan associates. Piementel rejected MSC's offer to issue shares for the money and sought return of the funds. Figueredo never disputed Piementel's claim and, on June 25, 1971, he gave MSC a written, notarized instrument releasing any claim he had to the $100,000. Thereafter Piementel *1058 and MSC settled the matter on the basis of MSC paying Piementel $95,000. The court concludes that Figueredo's claim to the $5,000 difference between what MSC got in September 1970 and what it returned to Piementel, plus $7,000 interest arising out of MSC's retention of the $100,000 for about one year, is, on the foregoing facts, wholly without merit.
NOTES
[1] Plaintiff did testify that Novak told him prior to March 4 that he could "rely" on Figueredo. Novak denied that such a conversation ever took place. As indicated infra, the court specifically finds that Novak had no such conversation with Branham. Furthermore, in the absence of an appropriate predicate, the statement "you can rely on Figueredo" is insufficient to clothe Figueredo with the mantle of agency, either directly or via an equitable estoppel.
[2] While the protection of investors is of primary importance under the federal securities statutes, it must be kept in mind, as the Fifth Circuit recently cautioned in Herpich v. Wallace, 430 F.2d 792, 804-805 (1970),
". . . that the nation's welfare depends upon the maintenance of a viable, vigorous business community. Considered alone, the sweeping language of Rule 10b-5 creates an almost completely undefined liability. All that the rule requires for its violation is that someone `do something bad,' Jennings & Marsh, Securities Regulation 961 (2d ed. 1968), in connection with a purchase or sale of securities. Without further delineation, civil liability is formless, and the area of proscribed activity could become so great that the beneficial aspects of the rule would not warrant the proscription. See Ruder, Pitfalls in the Development of a Federal Law of Corporations by Implication Through Rule 10b-5, 59 Nw.U.L.Rev. 185, 207-208 (1964). In recognition of this problem, courts have sought to construct workable limits to liability under section 10(b) and Rule 10b-5 which will accommodate the interests of investors, the business community and the public generally. . . ."
[3] Plaintiff's contentions, first raised at the trial, that he was also misled by the defendants' failure to disclose that a private placement of $1.5 million worth of MSC stock at $4.25 per share had been agreed to on February 25, 1971 and that the MSC shares he would receive would be restricted in no way helps his case. For one, the court has concluded that defendants owed plaintiff no duty of disclosure. Secondly, Plaintiff's Exhibit 23, an investment letter which Figueredo had Branham sign and then sent to MSC, affirmatively states both that Branham was aware that MSC was selling its shares for materially less than what Branham was going to pay and that the shares sought to be purchased would be restricted.
[4] For the same reason, the court finds it unnecessary to pass upon the defendants' contentions that Branham and Figueredo had agreed to a settlement of this matter, first on or about April 19, 1971, and thereafter on June 25, 1971, and that plaintiff's damages were fully satisfied and compromised on June 25, 1971, when Figueredo assigned his entire right, title and interest to 113,000 shares of Gramco common stock to Branham and Piementel.
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01-03-2023
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10-30-2013
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