Stillman v. Rosenberg

Waterman, J. [372] 1 2 [371] The pleadings-are ■ quite voluminous We shall not set them out, but will endeavor to present all the issues, as we proceed, in such a manner that the points ruled may be fully understood. The defendant Larrabee was the owner of the land in question, and on the eleventh day of October, 1883, through his agents, Miller & Thompson, sold it to the intervener Watson, .of Chicago, Illinois, for one thousand seven hundred and ten dollars, receiving one hundred and fifty dollars in cash and the six promissory notes of Watson for two hundred and sixty dollars each, for the balance. Larrabee conveyed the land by warranty deed to Watson, and Watson and wife gave back their mortgage thereon to secure the payment of said notes. This transaction was consummated by correspondence between Miller & Thompson and a brother of Watson, acting for him. Watson never took possession of the land, nor made any further payment of the consideration, nor any payment of taxes. He moved from Chicagoi to Nebraska without advising Larrabee or his agents of his whereabouts; and Larrabee, concluding, from Watson’s failure to take possession, or make payments, or assert any right to the land, that he had abandoned it, after default in the payments, took possession, and paid the taxes. Thus relying upon Watson’s having abandoned the land, Larrabee contracted a sale thereof to the defendant Rosenberg on the first day of September, 1887, for two thousand two hundred and three dollars;-two hundred and three dollars of (which was paid in cash, the balance to be paid in installments as specified in the contract. -Rosenberg took possession of the land, and has ever since held and used the same, has made valuable and lasting improvements thereon, and paid the taxes. Being unable to find Watson, so as to secure a reconveyance from him, Larrabee commenced his action on the eighteenth day [372] of April, 1899, against Watson and wife, on notice by publication, to foreclose said mortgage. On June 13, 1889, default was entered against Watson and wife, and judgment for two thousand six hundred and fifty-four dollars and eighty-two cents and decree of foreclosure rendered against them. July 36, 1889, the land was sold, under special execution issued on said decree, to the defendant Larrabee, for two thousand seven hundred and fifty-three dollars and thirty-six cents, and a certificate issued to him, in pursuance of which a sheriff’s deed was executed and delivered to Larrabee on the thirty-first day of July, 1890. On the twenty-sixth day of September, 1892, Larrabee and wife, in pursuance of said contract, executed to Rosenberg a warranty deed for said land. On the twentieth day of April, 1896, Watson and wife, for a recited considération of “one dollar and other valuable considerations,” but in fact for the consideration of ten dollars, executed their quitclaim deed of said land to the plaintiff, Stillman. On the ninth day of September, 1896, Watson and wife executed another quitclaim deed to said land to the defendant Rosenberg for a consideration of one dollar. Each of the- foregoing conveyances was filed for record, and recorded within a short time after their, respective dates. The decree of foreclosure of the mortgage from Watson to Larrabee, and the sale and conveyance of the land thereunder, are only questioned in one particular. The affidavit upon which original notice by publication was made states that “personal service of original notice in said cause cannot be made upon the said David Henry Watson within this county;” the word “county” being used instead of “state,” as required by the statute. The substance of the first decree herein, rendered by Hutchinson, J., is as follows: The court found.that plaintiff is the absolute owner ■of the land, and entitled to be quieted in his title, as against the defendants and interveners, on condition that he pay into court, within sixty days from that date, the sum of [373] two thousand six hundred dollars and ninety-three cents, with interest from the twenty-third day of April, 1897, to the date of payment. It was ordered that, if he made said payment within the time aforesaid, the. title should be forever’ quieted in him; and that, in case lie failed to pay said sum within said time, “then, in the event of such failure, the plaintiff shall be barred of all right or claim in and to any part of said premises, and his petition in this cas,e shall be| deemed dismissed, and he shall be liable for the costs of this suit.” It was found that Watson and wife had no right to the land. It was also found that there was due from the plaintiff to Larrabee, on the date of trial,- four thousand nine hundred and twenty-three dollars and seventy-three cents, on the notes and mortgage of Watson, which it was decreed plaintiff must pay to redeem the land from said mortgage. It was found that there was due from Larrabee to Rosenberg, at the date of trial, as damages for a breach- of the warranty upon the sale of the land, the sum of three thousand four hundred and seventy-seven dollars and fifty-three cents. • It was found that there was due from Rosenberg to plaintiff, for the use of the land, after deducting for improvements and taxes, the sum of two thousand three hundred and twenty-two dollars and eighty cents. It was ordered that if plaintiff paid into court said sum of two thousand six hundred dollars and ninety-three cents, as required, one thousand four hundred and forty-six dollars and twenty cents thereof, with interést from the date of decree, be for the use and benefit of defendant Larrabee, and one thousand one hundred and fifty-four dollars and seventy-three cents, with interest from date of decree, be for the use and benefit of defendant Rosenberg. It was further ordered that the costs be deducted from the amount deposited for the benefit of Larrabee. The decree concludes as follows: “The court reserving jurisdiction of this case to make such other and supplemental decree [374] herein as may be required,' either affirming this decree, in case the plaintiff pays into court the amount aforesaid, or dismissing the plaintiff’s petition, and quieting the title in the defendant Rosenberg, in case of plaintiff’s failure to so deposit.” II. The plaintiff states his objections to the supplemental decree which was rendered by Wakefield, J., as follows: “First, that, an appeal having been taken from the original decree long prior to the rendition of the supplemental decree, the district court was deprived of all jurisdiction to render the latter decree; second, that the defendants, by taking an appeal, elected not to accept the money which was to be paid for their benefit, and that plaintiff was, therefore, excused from paying the same' until the case should be finally determined in the supreme court; third, that the defendat Larrabee was not entitled toi receive any of the redemption money, and hence had no right to complain of its nonpayment.” In Levi v. Karrick, 15 Iowa 444, this court said: “That a chancery proceeding, when appealed from after a final decree, can be pending in this and the district court at the same time, subject alike to the control and action -of either court, is against the whole theory of our system of jurisprudence. The simple matter of fact is that, when appeal is taken, all power of the court below over the parties and the subject-matter is lost until the cause, or some part thereof, is remanded back by order of this court for its further action.” See, also, McGlaughlin v. O’Rourke, 12 Iowa, 459. It is insisted that because of the peculiar' facts of this case, and because Rosenberg did not give a supersedeas bond, this rule does not apply. We think it is clear that by the appeal of Rosenberg the case was brought fully within the jurisdiction of this court, and that the district court had no further right to proceed in the case. The question whether the plaintiff was entitled to have the land by redeeming from the mortgage was involved in the issue between him and defendant Rosenberg, and [375] the mere fact that the decree in plaintiffs favor gave him a day within which to pay the money did not reserve to that court, as against the appeal, the right to proceed further in the case. We think plaintiff’s first objection to that decree is well taken, and for that reason the supplemental decree is reversed. 3 III. We now consider the case as presented on the appeals of defendant Rosenberg and plaintiff from the original decrees; and, first, whether plaintiff acquired title to the land by the quitclaim deed from Watson subject to the mortgage. It is not seriously claimed that Larrabee acquired any title through the foreclosure decree and sale thereunder. That- decree was rendered without the required notice, and, consequently, without jurisdiction, and was, therefore, void; hence, this case stands as though those proceedings had not been had. The title stood in Watson, subject to his mortgage, and the plaintiff had the undoubted right to acquire title, if he did so honestly. The claim is that he procured it by fraudulently representing'to Watson that his quitclaim deed was desired to perfect the title to Larrabee and his grantee .under the decree of foreclosure of the mortgage. There is no doubt but that plaintiff, having discovered the defect in said affidavit for publication of original notice in the foreclosure case, and knowing its effect, quietly, shrewdly, and cunningly, and as a matter of mere speculation, proceeded to procure the deed from Watson. It appears that he employed detectives to ascertain the whereabouts of Watson, and, finding the latter had returned to Chicago, his address was secured, and plaintiff sent a quitclaim deed to Mason Bross, an attorney of that city, by mail, with instructions to call on Watson, and pay ten dollars in money if he and his wife would execute it. This deed, after describing the real estate, contained tbe unusual provision that a right of action for trespass and for rents and profits was also assigned to the grantee. When Bross went to Watson, he represented that the quitclaim [376] was wanted, to vest a good title in some party who desired to purchase. Watson did not'suppose he had any claim to the land. He made none, and was quite willing to aid those from whom he had purchased in making a good title. Believing that this was all that was wanted, he and his wife executed the conveyance without reading it. Watson testifies that he never would have made the deed had he supposed it was to be used in defeating the title of his grantors. These facts are practically undisputed, for Bross admits he told Watson the deed was wanted to “fix up” the matter. Watson had no substantial interest in the land that,he cared to assert. Indeed, it is quite likely that his laches barred him from asserting any such interest had he desired doing so. Horr v. French, 99 Iowa, 73. But, aside from this last consideration, we think plaintiff gained no rights under this deed. Bross’ representations were fraudulent, and, being the agent of plaintiff, the latter is bound thereby. This deed was not wanted to fix up a title, but to convey one to plaintiff. If Bross did not affirmatively and positively give Watson to understand that his (Watson’s) grantors were interested in obtaining the conveyance, he certainly did so by manifest inference; and this was a, fraud. A person may make a false representation by indirect as well as direct statements, and even by keeping silence when he ought to speak. The case of Rollins v. Mitchell, 52 Minn. 41 (53 N. W. Rep. 1020), is very similar in its facts to the case at bar, and sustains us in the conclusion that any interest acquired by Stillman under his deed from Watson is held only as a trustee for Rosenberg. See, also, Pomeroy Equity7' Jurisprudence, section 1053. It is by no means clear that Watson would have understood the clause in the deed assigning a right of action for trespasses and rents as in any way conflicting with the representations mad© him had his attention been called to the matter at the time he signed the deed. But, however this may be, the doctrine of McCormack v. Molburg, 43 Iowa, 561, and similar cases cited by plaintiff, [377] does not apply. It is not sought {here to set aside this conveyance because of this provision. Watson and all other parties are quite willing it should stand just as made, for-the purpose for which it was given. Rosenberg prays that his title be quieted against the claims of plaintiff. He is entitled to have this done. Plaintiffs petition will be dismissed, and all costs taxed to him on both appeals.— Reversed.