Barthell v. Syverson

Seevers, J. i. arm tract: mortgage. ’ I. The decree in the District Court is in the nature of a strict foreclosure, and the effect of it was to cut off the defendant’s right to make statutory redemption. The material question is whether he was entitled thereto. If the contract should be construed to be a mortgage, the decree is erroneous, but it is correct if it was a conditional sale of the equitable interest owned by the plaintiff under and by virtue of the certificate of sale. It must be one or the other, and counsel for the plaintiff seems to have been uncertain which, for he asked a money judgment against the defendant — that a specific performance be decreed, and the title be quieted in the plaintiff. The settled rule, at least in this State, is that in all doubtful cases the contract should be construed to be a mortgage instead of a conditional sale. Trucks v. Lindsay, 18 Iowa, 504; Scott v. Mewherter, 49 Iowa, 487. [163] There is another rule which is regarded as equally well settled, and that is, where the relation of debtor and creditor exists, and the contract was intended to create or provide a security for a debt, it will be construed to be a mortgage. Hughes v. Sheaff, 19 Iowa, 335; Green v. Turner, 38 Iowa, 112; White v. Lucas, 46 Iowa, 319. The real difficulty is in the application of these rules. In the case at bar, it seems to us the relation of debtor and creditor did exist, at least as to the money borrowed, and for which the defendant gave his note. For this the defendant made himself personally liable, and the real estate was to be held as security therefor. It is true the contract provides for an extension of the time of redemption; but we think, taking into consideration the obligation assumed as to the borrowed money, and that said redemption was to be made “ by the payment of the amount now due on said certificate, and the amount of money this day loaned,” that the defendant assumed and agreed personally to pay the whole amount. We think this was the evident intent of the parties and that in legal contemplation the contract is, and should be construed to be, a mortgage. This case is distinguishable from Alston v. Wilson et al., 44 Iowa, 130, because: First, in the latter, the time of redemption had expired when the contract was made; and, Second, the defendant did not obligate himself to pay anything. He simply had the option to pay or not, as he saw proper. 2. mortgage : taxes? ‘ II. The defendant pleaded that the plaintiff “ broke and entered the premises, and tore down and destroyed defendant’s flour mill then standing and tore out and carried away the machinery therefrom,” for which damages were asked. The fact was the mill was out of repair and the plaintiff took out a single piece of defective machinery and replaced it with a new one, at an expense of $28. For a short time, the mill in consequence of this action was idle. For such delay the damages are claimed. Without referring to the [164] evidence we deem it sufficient to say that nothing can, under the circumstances, be allowed therefor; nor can the plaintiff tack the amount paid for said machinery to his mortgage and have the same made a charge on the real estate. Jones on Mortgages, sections 360 and 569. But he can have the amount paid for insurance and taxes included in the amount otherwise due, because in substance the contract, or mortgage, provides defendant should pay the same, and the plaintiff having done so in order to protect both himself and the defendant from loss, the amount paid should constitute a charge on the mortgaged premises. Jones on Mortgages, sections 414 and 415. We deem it proper to say that the language in Savage v. Scott, 45 Iowa, 130, in relation to the right of a mortgagee to pay taxes and have the same tacked to the mortgage, should be strictly confined to the facts in that case. Reversed.