Case ID: iowa_30/html/0440-01.html
Source: Caselaw Access Project
Author: {"author": "Miller, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Stannus v. Stannus.
    1. Promissory note defenses : husband and wife. A claim- against the husband cannot be pleaded as a set-off in an action by the wife, on a note which he has legally transferred to her, and which is her property.
    2.- While a note transferred after maturity is subject, in the hands of an indorsee or assignee, to any defense thereto arising out of any equities between the original parties, and attaching to the note, it is not subject to a mere set-off of the maker, though existing at the time the note was negotiated.
    
      Appeal from Lee Circuit Court.
    
    Wednesday, January 25.
    This action was originally commenced before a justice of the peace, to recover a balance due on a promissory note made by the defendant to the plaintiff.
    The defendant answered, admitting the making of the note, and pleading a set-off against William Stannus, the husband of the plaintiff. The plaintiff demurred to so much of the answer as stated and claimed the set-off. The demurrer was sustained, and the defendant, by leave of the court, filed an amended answer, to which the plaintiff demurred, and the demurrer was sustained to a portion of the amended answer. That part held good on the demurrer is, in substance, as follows: That the defendant purchased of William Stannus, husband of plaintiff, the homestead of William and Rebecca, about the time of the execution of the note sued on; that the consideration named in the deed was paid by defendant to said William; that the plaintiff, as the wife of William, joined in the , execution of the deed; that said purchase-money was paid upon the representation of said William Stannus that all county, State and city taxes on said property were paid, except for the year 1868, which representations were false and deceived the defendant, and operated as a fraud upon him; that by such representations he was induced to accept a deed for the property with covenants of warranty, except as against tmes; that he took the deed and paid the purchase-money under a mistake of fact as to the taxes unpaid on the property; both parties supposing and agreeing that all taxes were paid except for the year 1868; that William so represented the facts to the defendant, whereas the fact was, that the property had been sold for the taxes of 1867, which defendant was compelled to pay, to redeem the property from such tax salé, which he pleads as an offset to the note. He also alleges that the plaintiff is not the owner of the note.
    The plaintiff filed a reply, taking issue on this answer claiming a set-off; the cause was tried by the justice who rendered judgment for the plaintiff. Defendant appealed to the circuit court, where the action was tried by the court without a jury, and'a judgment was again rendered for the plaintiff. Defendant appeals.
    
      
      Lowe & Brown for the appellant.
    
      Gilmore & Anderson for the appellee.
   Miller, J.

I. The appellant makes the point and insists upon it, that, “ where the husband and wife unite in the execution of a deed, with covenants of warranty, in the sale of their homestead, and the property is subsequently found to be-incumbered with taxes, the wife is equally liable with the husband on such warranty.”

It is not necessary that we should determine this question, for, by an examination of the defendant’s pleading, it clearly appears that his set-off is not founded upon any breach of the covenants of the deed. The gravamen of appellant’s set-off is the false and fraudulent representations of William Stannus, whereby appellant wasy induced to accept a deed with covenants of warranty, exc&ptmg tarns. 'No breach of covenant is averred, nor is it alleged that the plaintiff was a party to the false representations, or had knowledge that any were made. The cause of action, as stated by defendant in his answer, is against William Stan-nus alone.

II. It is insisted, in the second place, that' the note sued on was and is the property of William Stannus, who is the real party in interest, and that therefore the defendant’s claim against said William Stannus may be set off against the note in plaintiff’s hands. By the judgment of the court below, it was found that the note was the property of the plaintiff, and whatever might be our conclusion on this fact, were it an original question here, we are of opinion that the evidence sufficiently sustains the finding of the court below.

The note was made payable to the plaintiff, thereby creating the presumption, in the first instance, that it was her property. She testified that a part of the property for which the note was given was hers; that her husband gave her the balance of the note for her support in his absence. The defendant treated the note as belonging to the plaintiff, by making three several payments thereon to her, two of which were made after the time when he says he discovered that the property had been sold for taxes; and so far as appears from the evidence, these payments were made by him to the plaintiff without objection or protest.

"Whether the consideration for which the note was executed was the property of William Stannus, or that of the plaintiff, the facts of the ease show that the title of the note was transferred and vested in the plaintiff.

The claim pleaded by the appellant, in his answer as a set-off, is an independent cause of action against "William Stannus, in nowise connected with the note. A set-off against the payee of a promissory note cannot be pleaded in an action by an assignee or indorsee thereof, even where it is transferred after maturity. Such note would be subject to any defense thereto arising out of any equities between the original parties, attaching to the note, but not to a set-off, though existing at the time the note was negotiated. Shipman v. Robbins, 10 Iowa, 208; Lewis v. Denton, 13 id. 441; Ryan & Loutham v. Chew, id. 589 ; Way v. Lamb, 15 id. 79.

"While the claim of the appellant would’be a good cause of action against William Stannus, it cannot be made available in this action on a promissory note made payable to the plaintiff, and in fact her property.

The judgment of the circuit court is

Affirmed.