Simmons v. Church

Miller, J. 1. default: discretion. — I. While the court below has a large discretion in acting on applications to set aside defaults, and this court will rarely interfere with the rulings 011 g,^ applications, yet it is the manifest duty of this court to do so when 'there has been a clear' abuse of discretion, or a misapprehension by the court below of its duty in the premises. In the case before us, the court, on motion, struck from the files the application of the appellant, thus refusing to hear and pass upon its merits. The application was in time; a mere naked default having been entered, which may be set aside at any time before judgment is rendered .thereon, on proper grounds. Harper v. Drake, 14 Iowa, 533. The showing made by the appellant was that he was the absolute owner in fee of the mortgaged premises by a conveyance prior to the mortgage; that he had been and was at the time the mortgage was made, and has continued, in the actual occupation and possession of the premises; that the plaintiff’s attorney persuaded Mm that, because he had .failed to record his deed until after the mortgage was [287] recorded, he had no defense and that it was useless to make any. a. notice : siom posses The defendant’s possession under a prior deed from the mortgagor was constructive notice to all parties of his rights to the same extent as if his deed had been placed on record. Baldwin v. Thompson, 15 Iowa, 505; Humphrey v. Moore, 17 id. 193, and cases cited. See, also, Dickey v. Lyon et al., 19 id. 544, and cases cited in opinion of Core, J. Hence the mortgagee and his assignee, the plaintiff, had notice of the superior title of the defendant when they took the mortgage. The effect of the ruling of the court, if allowed to stand, would be to compel the appellant to pay the amount of a mortgage executed by his grantor which was not in existence when appellant acquired a perfect title as against the mortgagor and all persons claiming through or under him. Manifest injustice is thereby done to the appellant. 3. deeault: reasonexouse’ II. Was there such “a reasonable excuse shown for making default ” as that it became the duty of the court to set it aside? We are of opinion that there was. Had the appellant applied for advice to an attorney unconnected with the case for the plaintiff, and been erroneously advised as to his legal rights in the premises, he would not be entitled to the relief asked. But the advice which he received and acted upon was given to him by the plaintiff’s attorney. The petition to set aside the default does not show whether the attorney, on his own motion, approached the appellant and advised him that he had no defense, or whether appellant applied to the attorney and sought his opinion; or, if the latter, whether appellant knew that the attorney he applied to was plaintiff’s attorney in the cause. It is stated, however, that the defendant “ believes plaintiff’s said attorney so ad/vised him wrongfully for the purpose of circumventing him and to procure said default, and for the purpose of defeating his title to said property.” [288] This statement is under oath and not controverted. It must, therefore, for the purposes of the application, be taken as true. An attorney is bound in duty as well as honor to disclose, to one seeking his counsel and advice in respect to a suit in court, his connection with the case; and being the attorney of one party he should either decline to advise the other party or advise him correctly. In this case the plaintiff’s attorney, whether he disclosed his relation or not, chose to advise the defendant that he had no legal defense to the action, which, we have seen, if the averments of the answer are true, was clearly erroneous. On this erroneous opinion the defendant shows that he relied and made no defense. By means of the advice thus given the plaintiff gained an undue advantage over the defendant, for it cannot be doubted that if 'the defendant had been correctly advised he would have been prompt in putting in his defense. If, then, the plaintiff’s attorney, as is alleged, advised the defendant erroneously for the purpose of misleading and preventing him from making a defense to the action, the defendant being thus entrapped and misled, the default should have been set aside. The order and judgment of the circuit court are Reversed.