Court Opinion

ID: 3432245
Source: CourtListenerOpinion
Date Created: 2016-07-05 20:01:07.758028+00
Date Added: 2024-06-11T14:03:45.146203
License: Public Domain

I find myself unable to agree with the foregoing opinion, for the following reasons:
This is an action to foreclose a real estate mortgage upon an eighty-acre farm, forty acres of which constituted defendants' homestead. A decree of foreclosure was duly entered and a special execution issued thereon. Prior to the date of the sheriff's sale, the defendant served notice on the sheriff, demanding that the nonhomestead forty be sold first. At the sale, the sheriff received a bona fide bid of $2,000 for the nonexempt land, but refused to sell it separately. He then offered the homestead forty, and received a bid of about $3,000 therefor, and also refused that. He then offered both forties together and received a lump sum bid of $8,222.85 therefor from the plaintiff. This being more than the aggregate of the separate bids, he sold the entire eighty to the Prudential Insurance Company for that amount. The bid of $2,000 for the nonhomestead forty was made by a person who was ready, able, and willing to pay cash therefor.
The sheriff's return showed the foregoing facts. Thereupon defendants filed a motion to set aside the sheriff's sale on the ground that forty acres of the mortgaged premises constituted defendants' homestead and should have been sold separately, and then only to satisfy a deficiency remaining after exhausting a nonhomestead property. The lower court sustained defendants' motion, and plaintiff appeals.
The sole question raised is the right to sell the homestead forty before selling the other forty included in the mortgage. Section 10150 of the Code provides that:
"The homestead of every family, whether owned by the husband or wife, is exempt from judicial sale, where there is no special declaration of statute to the contrary * * *."
The statutory declaration to the contrary is contained in section 10155 of the Code, which provides that: *Page 1132 
"The homestead may be sold to satisfy debts * * * created by written contract by persons having the power to convey, expressly stipulating that it shall be liable, but then only for adeficiency remaining after exhausting all other property pledged
by the same contract for the payment of the debt." (Italics ours.)
The debt created by the mortgage in question comes within the terms of section 10155. The property pledged by the mortgage is an eighty-acre farm, forty acres of which constitute defendants' homestead. Under the provisions of the two sections referred to, the homestead cannot be sold except "for a deficiency remaining after exhausting all other property pledged."
Many cases are cited by appellant to sustain its contention that the homestead forty can be sold with the nonhomestead forty, if the aggregate of the bids for each forty separately is less than the bid received for both en masse. The cases cited, however, relate only to sales where no bids whatever werereceived for the nonhomestead property when offered separately. The following cases are cited in support of the majority opinion: Burmeister v. Dewey, 27 Iowa 468; Conn. Mut. Life Ins. Co. v. Brown, 81 Iowa 42, 46 N.W. 749; Glenn v. Miller, 186 Iowa 1187, 173 N.W. 135; State Bank v. Brown, 128 Iowa 665, 105 N.W. 49; Security Sav. Bank. v. King, 198 Iowa 1151, 199 N.W. 166; Boyd v. Ellis, 11 Iowa 97; Sheakley v. Mechler, 199 Iowa 1390, loc. cit. 1395, 203 N.W. 929; Finken v. Schram, 212 Iowa 406, 236 N.W. 408, and Arnold v. Murphy, 199 Iowa 934, 203 N.W. 387. An examination of these cases, however, shows they do not support the rule contended for, but simply hold that, where the homestead is pledged with other property, and no bids are received for the other property when first offered separately, then the other property may be combined with the homestead and sold together, on the theory that, where no bids are received on the nonhomestead property, when first offered separately, it will be considered "exhausted", and can then be sold with the homestead en masse. An examination of all of these cases will show that not one of them supports the rule that exempt and nonexempt property can be sold en masse, where a reasonably adequate bid has first been receivedfor the nonexempt property when separately offered for sale.
Only two of all the cases cited permit the sale of the homestead and nonhomestead property en masse, but the ruling therein was based upon the fact that no bids whatever were received upon the nonhomestead property when first offered separately for sale. The *Page 1133 
rule permitting the sale en masse in those cases was based upon the assumption that the nonhomestead property was considered exhausted because no bids were received therefor when first offered separately. The only cases cited as supporting this rule are Burmeister v. Dewey, supra; Conn. Mutual Life Ins. Co. v. Brown, supra.
In Glenn v. Miller, supra; State Bank v. Brown, supra; Security Sav. Bank v. King, supra; Boyd v. Ellis, supra, the question of restricting the sale of a homestead to a deficiency remaining, after all other property was exhausted, is not involved. They are simply authority for the rule that property may be sold en masse without first offering it in separate tracts, and the question of selling homestead property was not involved.
The remaining cases cited do not support the majority opinion, but, on the contrary, support the rule that homestead property cannot be sold until all other property included in the mortgage has first been disposed of. Sheakley v. Mechler, 199 Iowa 1390, loc. cit. 1395, 203 N.W. 929; Finken v. Schram, 212 Iowa 406, 408, 236 N.W. 408, and Arnold v. Murphy, 199 Iowa 934, 203 N.W. 387.
In the instant case, however, the nonexempt property included in the mortgage had not been exhausted. That forty was unimproved and was first offered separately. A bona fide bid of $2,000, or $50 an acre, was offered therefor and refused. It is not claimed that the amount offered for the nonhomestead forty was inadequate and should therefore have been sold en masse with the homestead.
The statute provides that the homestead forty cannot be soldexcept for a deficiency remaining after exhausting the otherforty included in the mortgage. Did the sheriff exhaust all other property pledged before resorting to a sale of the homestead to satisfy the deficiency? It will not do to say that he exhausted such other property, when he failed to sell it after receiving a substantial bid therefor. How can it be known that a deficiency exists until after a sale of the nonhomestead property is first made? It is impossible to determine the amount of the "deficiency" until the nonexempt forty is first sold, as "it cannot be determined until that time with that degree of certainty contemplated by the law that a deficiency exists. The homestead is a solicitude of the law, and this court recognizes the importance of the preservation of the home. * * * A judicial sale of the homestead under stipulations in a mortgage is to be *Page 1134 
enforced for the benefit of the mortgagee as a last resort only." Sheakley v. Mechler, supra, loc, cit. 1395. Under the facts in this case, it was the duty of the sheriff, under the law, to sell the nonhomestead forty first, if he received a substantial bid therefor. The homestead could then be sold only to satisfy a deficiency remaining. Any other construction of the statute would render it meaningless. Without this statute, the homestead could not be sold; with the statute, it can be sold only after all other property pledged has been "exhausted".
It is the settled law of this state that, where a portion of the land mortgaged is the homestead, it cannot, under the law, be sold except to supply the deficiency remaining after a sale of the nonexempt property included in the mortgage. Such is the construction given the statute by the following cases, and we are controlled thereby: Lay v. Gibbons, 14 Iowa 377, 81 Am. Dec. 487; Twogood v. Stephens, 19 Iowa 405; Equitable Life Ins. Co. v. Gleason, 62 Iowa 277, 17 N.W. 524; Walther v. Walther, 161 Iowa 560, 143 N.W. 503; Haynes v. Rolstin, 164 Iowa 180, 145 N.W. 336, 52 L.R.A. (N.S.) 540; Kilmer v. Gallaher, 107 Iowa 676, 78 N.W. 685; Moody  Son v. Century Sav. Bank, 239 U.S. 374, 36 S. Ct. 111, 60 L. Ed. 336; Lambert v. Powers, 36 Iowa 18; Bankers Life Assn. v. Engelson, 148 Iowa 594, 126 N.W. 951; Owens v. Hart,62 Iowa 620, 17 N.W. 898; White v. Rowley, 46 Iowa 680. These cases support the declaration of the statute providing that the homestead cannot be sold except "only for a deficiency remaining after exhausting all other property pledged." Section 10155.
In Twogood v. Stevens, supra, loc. cit. 412, this court said:
" * * * It is the policy of the law, not to allow a homestead to be levied upon and sold, even if otherwise liable, until all other property of the defendant in execution, is first exhausted; that this homestead right is equal, if not superior in dignity to any other legal or vested right, and should not be disturbed, short of a fair sale to the highest bidder, of all the other property."
In Haynes v. Rolstin, supra, loc. cit. 183, this court said:
"The real property involved in the present proceeding was, * * * in part occupied as a homestead. * * * had the mortgagee sought foreclosure during the lifetime of M.D. Haynes, the latter, with his wife, had the right to insist that the property outside the *Page 1135 
homestead should first be exhausted. Code section 2979. Twogood v. Stephens, 19 Iowa 405; * * *"
The legislature had a right to prohibit the sale of the homestead if it so desired. In fact, in the absence of section 10155, the homestead would have been absolutely exempt under section 10150. It is obvious that the object to be attained by section 10155 was to permit the owner to save his homestead without being compelled to redeem from a sale of the entire property. It is not for us to say whether this statute is wise or unwise. All we have to do is to construe it. This statute is plain and unambiguous, and the legislative intent should be carried out by the courts. This construction is supported, rather than contradicted, by Sheakley v. Mechler, supra, loc. cit. 1395, cited by appellant. In that case this court said:
"The real question at issue involves the right of occupancy of a homestead by the mortgagor during the year of redemption. May he pledge this right as security for a debt? If not, why not? Section 10150 of the Code, 1924, provides that: `The homestead of every family * * * is exempt from judicial sale, where there is no special declaration of statute to the contrary.' Clearly a sale under foreclosure is a statutory judicial sale. What is the special declaration of our statute which removes the homestead from the defined exemption? It is: `The homestead may be sold to satisfy debts * * * created by written contract by persons having the power to convey, expressly stipulating that it shall be liable, but then only for a deficiency remaining after exhausting all other property pledged by the same contract for the payment of the debt.' Section 10155, paragraph 2, Code 1924. The contract in the instant case was executed by the persons having the power to convey the homestead. The contract did expressly waive homestead rights, and stipulated for the appointment of a receiver `who shall take possession of the mortgaged premises and collect all rents and profits accruing therefrom.' But one question, therefore, calls for an answer: Had plaintiffsexhausted all other property pledged by the same contract for thepayment of the debt, before resorting to the homestead to pay the deficiency on the judgment, if a deficiency existed? How may itbe known that a deficiency did exist until a sale of themortgaged premises on execution? [Italics ours.] * * * The homestead is a solicitude of the law, and this court recognizes the importance of the preservation of the home. The power to mortgage *Page 1136 
a homestead is qualified by statute, and a judicial sale of the homestead under stipulations in a mortgage is to be enforced for the benefit of the mortgagee as a last resort only."
This rule is also supported by Finken v. Schram, 212 Iowa 406, 236 N.W. 408, and, Arnold v. Murphy, 199 Iowa 934, 203 N.W. 387.
The lower court held that the homestead property involved in the instant case should not have been sold except for the deficiency remaining after a sale of the nonhomestead forty, a reasonable offer having been received therefor. I think the judgment of the lower court was right, and should be affirmed.