Opinion ID: 1658367
Heading Depth: 1
Heading Rank: 4

Heading: Balancing of Equities.

Text: In concluding its decision dismissing the plaintiffs' foreclosure action, the trial court wrote: All of the parties to this lawsuit have been hurt financially. Since their contracts were entered into, they have been hurt by national and international economic developments totally beyond their control. The defendants lost their down payment and contract payments. Plaintiffs have lost their hope of striking it rich. But of all the parties, it is the plaintiffs who are left with the mosttheir farm, and worth in 1985 far more than they undoubtedly paid for it in 1965, as well as the payments made to them under the contract before defendants went into default. Reviewing the record de novo, we reach a contrary conclusion in balancing the equities. Neither the plaintiffs nor the assignee defendants have shown that the equities preponderate in their favor. The plaintiffs seek only foreclosure of the contract and a judgment for the amount the Currys, and thereafter the assignee defendants as joint venturers, agreed to pay for the farm. On the other side of the ledger of equities, the assignee defendants have not satisfactorily shown what the plaintiffs initially paid for the farm, nor what improvements they made, nor what is its present market value. The plaintiffs do not yet have clear title to the farm; title and possession are subject to a receivership, judicial sale, and various parties' statutory redemption rights. The quitclaim deed Currys tendered to plaintiffs at the close of trial has not transferred title back to the plaintiffs because they have not accepted it. See County of Worth v. Jorgenson, 253 N.W.2d 575, 578 (Iowa 1977) (grantor cannot unilaterally force title upon a grantee; acceptance consists of grantee's conduct and intent to accept). Plaintiffs persuasively argue that they seek only the benefit of their bargain with Currys, extended to the defendant assignees by the joint venture agreement which spread the Currys' risk and potential profits among four additional persons. Each of the assignee defendants had in writing the terms of the joint venture agreement and the real estate contract each became obligated to perform. (Copies of the Bridgman-Curry contract were attached to the joint venture contract and to the executed acceptance of the assigned interests.) The assignee defendants must have known and understood there were risks involved in the venture. They expected to build a large equity in the farm with a minimal investment, hoping the Currys' management would generate farm income that would service the debt, make further capital outlays unnecessary, and eventually yield an unencumbered undivided one-sixth interest in the valuable farm. Each assignee defendant voluntarily assumed risks and obligations in pursuit of a profitable venture. Unfortunately for them the venture apparently will not be profitable, at least in the short term, but they have not shown it is inequitable to allow the plaintiffs to foreclose their contract and obtain a deficiency judgment for amounts they agreed to pay. The prayer of plaintiffs' amended foreclosure petition asked that a joint and several in personam deficiency judgment be entered against Currys as well as the assignee defendants. Currys are not liable for such a judgment because the plaintiffs in the reorganization proceeding waived all claims for a deficiency judgment against Currys. The assignee defendants as joint venturers, however, are jointly and severally liable for the amounts due under the Bridgman-Curry contract. The assignee defendants have not contended that their obligations to plaintiffs, if any, should be deemed several but not joint. Moreover, the law governing operations of joint ventures is that generally applicable to partnerships. Jensen v. Schreck, 275 N.W.2d 374, 378 (Iowa 1979). Individual joint venturers, like individual partners, would thereby be jointly liable to pay obligations of the joint venture. See Hanson v. Birmingham, 92 F.Supp. 33, 42 (N.D.Iowa 1950); 5 E. Hayes, Iowa PracticeBusiness Organization §§ 32, 33, 64, 85 (2d ed. 1985); 1 G. Hornstein, Corporation Law and Practice § 3 (1959). Of course all of the assignee defendants will have joint and several rights of redemption as debtors in accordance with Iowa Code chapter 628 (1985).