The daily Gate City. [volume] (Keokuk, Iowa) 1855-1916, 1911-07-28
Judge Henry Bank Decides Case
Against Lee County Farmer In
Which He Would Have Deed
Declared Mortgage.
INVOLVED MUCH LAND
Had to do With Nearly 100000 Land
In county-Newberry May Re-
deem Before October
First.

D. o. Newberry, OF Argyle, Iowa,
lost the suit which he brought in the
district court here against ]. c. Jor-
don ct al of Ottumwa, In which he
sought to have deed to his 1900
acres of Lee county farm land de-
clared mortgage, today when Judge
Henry Bank, Jr., handed down his de-
cision. Newberry borrowed $4,000
of the defendants, giving deed to
his land valued at $4,000 and used
the loan to prevent the issuance of
sheriff's deed to the land under judg-
ment previously obtained by the Citi-
zens' Mutual bank of Donnellson in
foreclosure proceeding. The court
held that it was understood by all
parties that the agreement entered
into was sale and that the theory
of the plaintiff that the purchase
price of the land for which deed was
given was loan was not sustained
by the evidence. Mr.. Newberry has
until October / of the present year to
exercise his option by repurchasing
the land for given amount. The
case is one of wide interest through
out the county because of the amount
of land which it involves. The writ
ten opinion of Judge Bank follows:
More than one hundred authorities
have been cited by counsel, all OF
which have been duly considered.
In the case reported in IS s. W.,
beginning at page 500, the supreme
court of Texas, in a case in which
an absolute deed was decreed to be
In the nature OF mortgage, uses
the following language: "a sale
whether absolute or conditional, i'm
plies the existence Of a purchase price.
in the former case an absolute pur-
chase price; in the latter purchase
prcie with the condition that the
vender may repurchase. The argu-
ment arising from the consideration
OF the inadequacy of price with ref
erence to the question of an absolute
sale applies also, though not SO fore
IDLY, to the question of conditional
sale. Besides, there is no evidence
here Of an agreement to repurchase
at a fixed time or for specified price.
The elements of conditional sale
Yere thus wanting in the transac-
tion.,
am satisfied from the evidence
that the parties understood the agree
ment made at Ottumwa in December,
1910, to be sale by Newberry and
wife to the defendants, with the priv
ilege or option on the part of Mr.. and
Mrs. Newberry to repurchase the
property sold, If they elected SO to
do, by certain time, for the amount
agreed upon, namely. s43,000.oO, with
interest at six per cent. This ques-
ton of interest has been duly consid-
cred by me, and / find that the mere
fact that interest was to be paid upon
the amount agreed upon does not OF
itself show that the deed was to be
held as security for a debt. Mr.. and
Mrs. Newberry have until October J.,
1911, to exercise their option by re-
purchasing the land for given
amount. / am satisfied from all the
authorities that there was no debt
contracted and the defendants could
not, under this arrangement, have re-
covered Judgment for any amount, as
for loan or debt. Had defendants
attempted to collect the purchase
price, as stated in the deed, under
the circumstances disclosed by this
record, am of opinion there would
be but little doubt OF their failure to
recover. According to some OF the
authorities, even if the agreement to
resell had been in writing and con
temporaneous with the absolute deed,
the transaction would not have been,
strictly speaking, provisional sale,
but sale with right to repurchase.
The sale would be valid, the fee would
pass, and the contract to resell would
stand upon its own footing and could
be enforced by bill for specific per
Torrance; go that when deed is