Des Moines Savings Bank v. Kennedy

Ladd, J. 1. Limitation of denceN!of non-residence. Upon the introduction of all of the evidence, the court withdrew all the issues from the jury save that of the plea of the statute of limitations. One of the notes became due March 19, 1896, an-77 other March 20, 1896, and the third Decem]jer 1896. Suit was begun January 26, 1907, so that the suit was barred by the statute declaring that actions on written contracts shall be brought within ten years after the causes thereon accrue (section 3447, Code), unless since then the maker had been a nonresident of the State for a time longer than the period between the expiration of the ten years and the commencement of the action, section 3451 of the Code, providing that the time during which a defendant is “a nonresident of the State shall not be included in computing any of the periods of limitation above prescribed.” To establish non-residence plaintiff introduced in evidence a patent to one hundred and sixty acres of land in Eaullc County, S. D., from the government to Michael Kennedy, bearing date January 8, 1904, and reciting that it was issued pursuant to the act of Congress securing homesteads to actual settlers — 275 — on the public domain and upon proof of compliance with said law by the grantee. In offering the patent in evidence, counsel for plaintiff stated that it was the “one which was produced by this defendant in response to an order of the court on the 27th day of April, 1907.” An objection as incompetent, irrelevant, and immaterial was overruled, and rightly so. On the order of the court that a “patent issued to defendant” such as described be filed with the clerk of the court, a patent was filed. The attorney offered the patent in evidence as the one so filed. It was subject to the inspection of counsel for defendant, and, if there was any doubt as to its identity, the attention of the court should have been directed thereto. This was not done and, as the attorney is presumed to have acted in good faith in the trial, the instrument will be assumed to be that produced in response to the order. The production of the patent in response to the order of the court was a solemn admission that it was that which the order called for, namely, a patent from the government to the defendant. As it was the original instrument, section 4633, Code Supp. 1907, is not applicable. Authorities cited concerning the necessity of identifying a document before it may be received in evidence are sound, but such identification may be by admission of the adverse party as in this case, and this is quite as conclusive as when by other evidence. Such admission obviated any question as to identification by name, though this might, in the absence of any showing to the contrary, alone prove sufficient in a civil action. 2. Evidence: dentity ¿f . II. Certified copies of an application and affidavit for this identical land as a homestead, filed in the United States land office at Huron, S. D., and of the sworn proof that Michael Kennedy had so complied with the act of Congress as to be entitled to a patent therefor, made by two witnesses and defendant, were also introduced in evidence. These were — 276 — equally as credible as the original papers. Section 4635, Code. Both the witnesses and the defendant therein testified that the latter settled on the land and established actual residence thereon August 15, 1898, had resided continuously thereon from that time until August 29, 1903, the date of the affidavits, and that in the meantime he had never been absent therefrom. The objection interposed to this evidence is that there was no showing that defendant was the person who made such proof. Ordinarily a person is identified by his name. It is the designation by which he is known, and in civil actions identity of name is prima facie evidence of identity of person. See cases collected in dissenting opinion in State v. Smith, 129 Iowa, 709; Snyder v. Fidler, 125 Iowa, 378. 3. Same: certified copies: admissibility. Of course, different persons may bear the same name, and whether, under the circumstances shown, a person was the particular party designated, may be for the jury to determine; but in this case the issuance of the patent to defendant for the identical tract, of land, the proof that he was in South Dakota much of his time during five years involved, that he had made proof of his homestead claim before the county clerk of like name with witnesses bearing the names of those mentioned in the affidavits, that he was on a claim, and his explanation how the affidavits were prepared, and that “the homestead law as understood in that neighborhood did not require the homesteader to remain on the claim at all times,” left no doubt as to defendant being the person named in the several papers. 4. Limitation of actions: nonresidence: evidence. III. From the evidence above referred to the jury might have found that defendant had been an actual resident of South Dakota for a period of five years, for to have acqiiired the patent he must have resided upon and cultivated the land for that period. Section 2291, 6 Fed. St. Ann. (U. S. Comp. St. 1901, p. 1390). Indeed, the only avenue — 277 — of escape from this conclusion was in finding that in procuring the patent he had perpetrated a fraud -on the government of the United States. Such was not the necessary deduction from the evidence adduced, and therefore the court rightly overruled defendant’s motion for a directed verdict. 5. Same- in-definition of terms. . IV. The court did not define the words “nonresident” or “resident” in its charge, and complaint is made of this omission. No instruction was asked, and under the peculiar facts of this case the omission to define these words, in the absence of such re--was not error. The only issue was whether defendant had established an actual residence on the homestead claim in South Dakota and lived thereon long enough to toll the statute of limitations for the required time. In no other way did plaintiff undertake to prove nonresidence of this State. Had he been a resident of South Dakota, as he represented in order to acquire the land under the patent, or a resident of this State, as he undertook to prove in order to defeat the collection of these notes ? Any definitions the court might have given could not have elucidated this issue. What has been said sufficiently indicates our approval of the instruction to the effect that a strong presumption arose that during the time defendant was acquiring his homestead he was a resident of South Dakota, and therefore a nonresident of this State. 6 Same-- non residence. V. The court told the jury that, if “defendant established and maintained a residence in the State of South Dakota, you are instructed that for the purposes of this ease during such time as he was a resifient of South Dakota he was a nonresident of the State of Iowa.” Undoubtedly a person’s residence in another state might be of a temporary nature, and such as not to constitute him a nonresident; but the only, evidence adduced by plaintiff tended to show that defend — 278 — ant was an actual resident of South Dakota, so that, if he established a residence there at all, it was an actual residence, and there was no error in this instruction. 7. Original notice: substituted service, It is argued that the evidence was such as to indicate that service of an original notice of an action might have been had on defendant at any time in. his absence from Polk County by leaving a copy at his usual place of residence in Des Moines. He was a widower Avithout family and when in Des Moines, after the spring of 1899, stopped Avith a sister, had a room in her house, which he occupied with her son, and in which he left his effects when away and Avas treated as a member of the family. The evidence tended to show that he was in Des Moines six or seven months of the year, but, to justify service of notice in his absence from the county or State by leaving a copy with a member of the family, he must have been an actual resident at the time. Schlawig v. De Peyster, 83 Iowa, 323; Fitzgerald v. Arel, 63 Iowa, 105. See Love v. Cherry, 24 Iowa, 204; Mann v. Taylor, 78 Iowa, 355. The statute exacts service on residents of the State in the counties of their actual residence. Section 3501, Code; Savage v. Scott, 45 Iowa, 130; Ludlow v. Szold, 90 Iowa, 175; Cohen v. Daniels, 25 Iowa, 88. If his. actual residence was in South Dakota Avhen there, as he represented to the government, it could not have been at Des Moines at the same time. Surely, in view of the evidence, the jury might well have concluded that he Avas a nonresident of this State, notwithstanding he passed considerable of his time in it with relatives. 8. Pledges: application of proceeds of pledged property. VI. It is asserted, however, that proper credits were not allowed on the notes sued on. The defendant conveyed one hundred and sixty acres of land to the bank November 25, 1895. At that time his only indebtedness to it was that ^ d evidenced by these notes. This land was sold and $4,100 realized therefrom January 4, 1899. Of — 279 — this sum but $935 was indorsed on one of tbe notes. Tbe remaining $3,165 was uséd in paying tbe premiums on a policy of insurance on defendant’s life for 1896 and tbe two years following. Tbis policy bad been issued December 13, 1893, assigned to tbe bank in 1895, and to continue it in force tbe payment of an annual premium of $1,055 for seven years more was required. Tbe indemnity to be paid on tbe death of insured was $10,000, In addition to the above amount, tbe bank advanced premiums for tbe four years subsequent to 1898, amounting, with interest, on December 20, 1903, to $5,058.85, and on that day received upon tbe surrender of tbe policy $6,422.-60. Tbis left a surplus over tbe four payments of $1,365.-75, which was indorsed on one of tbe notes. So that tbe carrying of tbis policy involved a loss of tbe three premiums first paid with interest as provided in tbe notes from January 4, 1899, to December 20, 1903, less tbe surplus of $1,363.75 realized from tbe policy above tbe cost of tbe last four premiums, with interest, on something over $1,800. Appellant contends that tbe court erred in not crediting tbe entire proceeds of tbe land on tbe notes on tbe day these were received by the bank, and in approving their appropriation to tbe payment of tbe premiums on the insurance policy. Tbis necessarily depends on tbe arrangement between tbe parties. With reference to tbe conveyance of tbe land, tbe defendant testified that “tbe object of the deeding was to protect tbe bank for any indebtedness I owed them at tbe time.” The cashier of tbe bank disclaimed personal recollection of tbe transaction, but to tbe inquiry whether “tbe deed was taken to increase tbe security of the bank, to make tbe bank more secure for any indebtedness that existed between Mr. Kennedy and tbe bank,” answered: “I should judge that might be the interpretation of.that, sir, I have no doubt of that.” Tbis was all the evidence bearing thereon, and no exception can well be taken if tbe testimony of tbe one and tbe con — 280 — struction of the other that the conveyance was to secure an existing indebtedness be accepted. This being so, the proceeds of the sale of the land could not be applied otherwise by the bank than on such indebtedness save by the consent of the pledgor, and no claim is made that this was given. This is elementary and exacts no more of the bank than that it bide the agreement under which the security had been received. Anderson v. Simms (Tex.) (4 S. W. 471); First Nat. Bank of Milwaukee v. Finck, 100 Wis. 446 (76 N. W. 608); Phillips v. Thompson, 2 Johns. Ch. (N. Y.) 418 (7 Am. Dec. 535); 22 Am. & Eng. Ency. of Law (2d Ed.) 869, and cases collected in note. The consensus of judicial opinion is thus stated in the last-mentioned work: “The pledgee has no right to hold property for any other debts than that for which it was pledged, and the proceeds of the property can not be applied to any debts other than that which was contemplated in the contract of pledge.” Chancellor Kent’s statement of the rule in his commentaries is pertinent: “The pawnee will not be allowed to retain the pledge of any other debt than that for which it was made even though the holder is a banker.” 2 Kent’s Comm. 775; Morse on Banking, 36; Duncan v. Brennan, 83 N. Y., 487, where it was said that “the general lien which bankers have on bills, notes and other securities deposited with them for a balance due on general account can not exist where the pledge of property is for a specific sum and not a general pledge.” And see Masonic Savings Bank v. Bank's Adm'r, 84 Ky. 135, 4 Am. St. Rep. 197, and note, in which the decisions are collected. So that the bank was without authority to make use of the proceeds of the land for the payment of any other indebtedness than that to secure which the land was conveyed. Even though the insurance policy was assigned to the bank at about the same time, it had incurred no expense thereon. Nor had it obligated itself to do so. The — 281 — cashier of plaintiff testified that: “The arrangement or agreement was with respect to the policy, that we could do as we pleased with it. If we desired to continue it in force, we could do it; if we did not, we could cancel it and collect any value attached to it. The policy was assigned to us to protect us from any pecuniary interest we might have in Mr. Kennedy.” And according to Kennedy ■the bank could cash the policy on his death or at the end of ten years. There is no evidence that the bank had thereby assumed or elected to pay the premiums on the policy, and therefore no indebtedness could have existed because of the policy at the time of the conveyance of the land; but the bank was entitled to be paid all the premiums advanced out of the proceeds of the insurance policy. McQuillan v. Mutual Reserve Fund Life Ass’n, 112 Wis. 665 (87 N. W. 1069, 88 N. W. 925, 56 L. R. A. 233, 88 Am. St. 986); Morris v. Georgia Loan, etc., Co., 109 Ga. 12 (34 S. E. 378, 46 L. R. A. 506); 25 Cyc. 774, and cases collected in note; Denis on Contracts of Pledge, section 274; Colebrooke on Collateral Securities,- section 426. The plaintiff then was entitled to retain the $1,363.-75 credited on the note December 20, 1903, and apply the same on the advances made by it in payment of the first three premiums; but it should have given the defendant credit for the entire proceeds of the farm at the time received on the indebtedness existing when the land was conveyed to it. The plaintiff may remit the sum in excess of that for which the judgment should have been rendered within thirty days from the filing of this opinion, or, upon its failure so' to do, the judgment will be reversed. The judgment, as so modified, will be affirmed.