Court Opinion

ID: 3430744
Source: CourtListenerOpinion
Date Created: 2016-07-05 19:59:42.717378+00
Date Added: 2024-06-11T13:43:16.639713
License: Public Domain

I find myself unable to agree with the sixth division of the majority's opinion, and therefore respectfully dissent.
The record in this case shows that a foreclosure action was commenced by filing a petition on the 28th day of October, 1932; that to the petition thus filed the defendants filed answer on the 12th day of January, 1933. An amendment to the petition was filed on the 25th day of March, 1933, and a substituted and amended answer *Page 355 
was filed on the 25th day of March, 1933. This cause came on for trial, and the decree was entered on the 25th day of March, 1933. It is important that these dates be kept in mind.
The appellants filed an application asking that the court continue the cause to March 1, 1935, in accordance with chapter 182 of the Acts of the Regular Session of the 45th General Assembly of Iowa, section 2 of said act being set out in the majority's opinion. No question is raised in this case as to the constitutionality of the above mentioned statute now under consideration.
In the majority opinion they say:
"According to section 2 of the statute previously quoted, a continuance is not to be granted in all cases. Such continuance shall be granted unless `good cause is shown' why the continuance should not be granted. The granting of the continuance is to be the rule under the statute, and, if the general rule is not to apply, the mortgagee must show good cause as to why it should not govern. In other words, the questions as to whether the mortgagor is to have a continuance is not dependent upon the judgment or discretion of the district court without reference to the purpose of the statute. Under the statute, the mortgagor is to have the continuance unless the mortgagee has shown good cause why he should not have the same."
Thus the majority concede the rule is that the continuance shall be granted and that it rests upon the mortgagee to show there is good cause for not granting the continuance.
Now, let us see what the majority believe to be the showing in this record by the mortgagee that there is good cause for not granting the continuance. It is based upon three propositions: First, that the mortgagor is insolvent; second, that since the default the mortgagor has not applied the rents and profits to the payment of taxes, interest, and principal; and, last, which seems to be the main ground, the majority say that there is approximately $25,000 now due on the indebtedness and under no circumstances is it possible that the appellant will be able to pay the debt, with the rapidly accruing interest, on or before March 1, 1935.
Let us consider the three propositions which the majority rely upon, as shown by this record.
First, the question of insolvency. It must be kept in mind that this cause was tried in March of 1933. It was tried when all of the banks in the land were closed under a proclamation of the *Page 356 
President of the United States. It was tried when the price of farm products was at the lowest level in the history of the country. It was tried when there was no money to buy real estate or to make loans upon real estate. It was tried before Congress had passed the Farm Mortgage bill for the refinancing of farm mortgages. The proof of insolvency in this case is based upon the fact that in March of 1933, under the economic conditions then existing, of which this court must take judicial notice, upon the testimony of three witnesses — two of them employees of the appellee bank and the other an auctioneer — who, in testifying as to the value of this farm, said: "As to market value, the economic conditions must be considered," and then placed a value upon this farm of $10,000, the mortgagor was held to be insolvent. It must also be kept in mind that in 1924, some four years after the boom and when farming conditions were not the best, the Federal Land Bank, appellee in this case, an agency of the government, loaned to these appellants upon the same land the sum of $20,000. The land, in order that the Federal Land Bank might make this loan, had to be of the value of $40,000, and this was the value that the appellee bank placed upon the said land in 1924, for it loaned $20,000, and now, nine years later, after the record shows improvements had been made on the land, the Federal Land Bank comes in and says to this court, "This land is worth only $10,000." But let us assume that the appellant was insolvent. This, in my judgment, is not good cause why the continuance should not be granted. Certainly the legislature never had any such idea in mind, and to say that because a man is insolvent a continuance should not be granted would destroy the purpose for which the legislature passed the statute authorizing the continuance of foreclosure actions.
The second proposition relied upon by the majority is that part of the rents and profits were not used in the payment of taxes, interest, and principal. To me this is not a ground for failure to grant the continuance. It is, in my judgment, not a showing of good cause why the continuance should not be granted. But, in the case at bar, we are not confronted with this question, because the mortgagor tendered in his answer and in open court to turn over to the mortgagee all of the rents and profits received from this farm from the date of the first default upon the mortgage. He offered to do equity, and in the face of such an offer certainly no court of equity *Page 357 
can say that that was good cause for refusing to grant the continuance.
Finally, we come to the last, and as I see it in the judgment of the majority the most important, reason for failure to grant the continuance. The majority say in their opinion that there is approximately $25,000 now due on the indebtedness. The decree which was entered in this cause shows there was only $20,189.55 with interest from August 1, 1932, and the costs of this action due at the time the decree was entered. Then, the majority say, "under no circumstances is it possible that the appellant will be able to pay the debt, with the rapidly accruing interest, on or before March 1, 1935." I can find nothing in the record that justifies any such conclusion. Since the decree in this case was entered in the lower court in March of 1933, Congress has passed what is known generally as the Farm Mortgage Bill. It was passed in May of 1933. Under that bill the Federal Land Banks are furnished money for the purpose of trying to save the farms of such people as the appellant in this case. Under the acts of Congress there is what is known as a fund appropriated by the government for additional loans to be made upon real estate. They are known as "Commissioner" loans. The Federal Land Bank in this case could make a loan upon the land, and then, in addition to that, the appellant can secure a second mortgage loan from the government known as a "Commissioner's" loan. These new measures passed by Congress have changed entirely the possibility of refinancing of farms in this state of ours, and this court must take judicial notice of the acts passed by Congress. To say that this farm cannot be refinanced because in March of 1933, when this decree was entered, things looked as though it could not be refinanced, is, in my judgment, not justified by the record or by what has happened since that time. In March of 1933 the prices of farm products were at their lowest level. There has been a marked improvement in the price of farm products. With the advance in farm products there has been a marked advance in real estate, and this court has no right to shut its eyes to the conditions which now prevail, and come to the conclusion that this appellant will not be able to refinance this farm by March 1, 1935. Assuming, for the sake of argument, that there is a showing in this record that the appellant would not be able to refinance his farm, I do not believe that such a showing would be good cause why the continuance should not be granted. The legislature passed the act for the purpose of assisting the people *Page 358 
of this state, and it must be kept in mind that the mortgagee loses nothing, for, under the act, a receiver is appointed to collect the rents and profits from the real estate. It is of vital public concern to the people of Iowa that the men and women in all parts of the state who, through their own efforts, have secured for themselves and their families a farm or home, be not ousted from their farms or their homes, but that they be given an opportunity with the aid of their government to refinance their farm mortgages. The continuance statute is limited in time. It continues the case only to March 1, 1935, which is a matter of only a little over a year. It provides the machinery for the collection of the income and rentals from said land during the period of continuance provided by the statute, and that said income and rentals shall be disbursed under order of the court, thus protecting the mortgagee.
The appellee in this case has failed to show good cause why the continuance should not be granted, and the lower court erred in so holding. I would reverse the case and remand it to the lower court with instructions to continue the case in accordance with the statute.