In Re Estate of Goeders v. Fillenwarth

148 N.W.2d 438, 260 Iowa 87, 1967 Iowa Sup. LEXIS 720
CourtSupreme Court of Iowa
DecidedFebruary 7, 1967
Docket52308
StatusPublished
Cited by6 cases

This text of 148 N.W.2d 438 (In Re Estate of Goeders v. Fillenwarth) is published on Counsel Stack Legal Research, covering Supreme Court of Iowa primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Estate of Goeders v. Fillenwarth, 148 N.W.2d 438, 260 Iowa 87, 1967 Iowa Sup. LEXIS 720 (iowa 1967).

Opinion

Stuart, J.

Alma Weir filed a claim against the estate of Bert Goeders based on a promissory note payable on his death in the amount of $8000 secured by a real-estate mortgage. She also claimed his household goods under a bill of sale. Administratrix filed a petition to sell real estate and to cancel the note, mortgage and bill of sale. These two matters were consolidated and tried in probate. The trial court sitting as a trier of fact found for claimant. Administratrix appealed.

Claimant introduced the written instruments and rested. Administratrix introduced claimant’s deposition taken under section 635.58 of the Iowa Probate Code and other evidence.

The trial court found: “* * * in March 1962 she was employed by decedent to work on his farm, at which time there *89 was talk of $1.00 per hour,- that he never paid her, and on February 4, 1963 he gave her the note, mortgage '(and bill of sale) as security for what she had done. Other evidence, however, conclusively shows her claim that she worked on the farm until his death on March 29, 1964, is incorrect. Actually, she continued on the farm only until sometime in October 1963. She admits she did not work 8000 hours, and therefore her testimony at most only shows the instruments were delivered to her as an advance payment for some hours of work yet to be performed. The number of hours worked before or after delivery of the instruments does not appear in the record.

“This record supports a finding that decedent was indebted to claimant for services rendered up to the date of delivery of the instruments — a period of approximately one year — and that she continued on the farm for some seven months thereafter.”

There is substantial evidence in the record to support these findings and we are therefore bound by them. Rule 344(f) (1), Rules of Civil Procedure.

The trial court concluded that “under the provisions of section 541.25 an antecedent or pre-existing debt constitutes value whether the instrument is payable on demand or at a future time. Here the services are a sufficient consideration for the note and the bill of sale.” He, therefore, held the estate had failed to introduce evidence tending to show the instruments were executed without legal consideration and claimants need offer no proof other than the execution and delivery of the instruments which under sections 537.2, 537.3} 541.24 and 541.28 are presumed to have been issued for a valuable consideration.

Notwithstanding appellant’s scholarly discussion of burden of proof and the force of presumptions as evidence, we do not believe these issues are determinative here. As we read the trial court’s findings, he has, from the evidence, found the actual consideration to be services rendered in the past and to be rendered in the future. This finding is supported by the evidence and therefore the question of burden of proof no longer is important.

I. We must determine whether the trial court was correct in holding, under the circumstances here, that the services *90 rendered in the past were a valid consideration for the note and bill of sale or whether there should be a pro tanto reduction for partial failure of consideration.

Trial court supported his finding that the instruments were issued for a preexisting debt by citing section 541.25 which provides : “Value is any consideration sufficient to support a simple contract. An antecedent or preexisting debt constitutes value, and is deemed such, whether the instrument is payable on demand or at a future time.”

He also cites Re Estate of Hore, 220 Minn. 374, 377, 19 N.W.2d 783, 785, 161 A. L. R. 1366, 1368, which held “personal services rendered under such circumstances that there is a legal obligation to pay for them constitutes sufficient consideration for a note given for them, regardless of their economic value as compared to the amount of the note.”

We do not disagree with these authorities, but do not find them applicable here. Appellee claims the instruments were to pay for work from the time of her employment to Mr. Goeders death. They were issued when she had worked a year. She worked seven months more and Mr. Goeders lived five months after she left. There is no claim the instruments were for past services only. No claim was filed for services rendered after the instruments were delivered. The consideration therefore, was not wholly for a preexisting debt but contemplated services to be performed in the future as well.

This feature distinguishes this case from Re Estate of Hore, supra. There the court said at page 375 of 220 Minn., 784 of 19 N.W.2d: “* * *' the issue made and litigated by the parties was whether there was any consideration at all and not whether there was a partial want of one.” Here appellant not only contends there was a failure to prove consideration, but in the alternative asked a pro tanto reduction for partial failure.

Where the findings indicate the consideration for the instruments to be personal services performed in the past and to be performed in the future, past services performed do not constitute full consideration and there should be a pro tanto reduction for the services which claimant failed to perform and which constituted part of the consideration for the instruments.

*91 Section 541.28 provides: “Absence or failure of consideration is matter of defense as against any person not a holder in due course, and partial failure of consideration is a defense pro tanto, whether the failure is an ascertained and liquidated amount or otherwise.”

«=* * * the amount recoverable on a note will be so reduced [pro tanto] in an action between the original parties or others standing in no better position, where the consideration has partially failed. As between the original parties, where the consideration for a note consists of services performed under a contract, recovery in full will be permitted if the services are sufficient under the terms thereof.” 11 C. J. S. 255, Bills and Notes, section 721. See also 10 C. J. S. 1150, Bills and Notes, section 523.

The trial court held appellant failed to prove the extent of the partial failure of consideration and refused to make a pro tanto reduction. This apparently was based on the absence of proof of the number of hours claimant actually worked. We do not believe such proof is necessary. There was evidence from which the court could find the instruments were to pay claimant for her services from her employment until Mr. Goeders death. If so, she would have been entitled to the whole amount had she stayed until he died. Under the evidence before us, a pro tanto reduction of %4, representing the five months she left before his death out of the two years between her employment and his death, would seem reasonable.

We hold the trial court erred in holding the past services constituted valid consideration for the entire note and bill of sale under the circumstances. We cannot determine whether the trial court found the future services were to be rendered on an hourly basis or until Goeders death. We remand the ease for further evidence on and a factual determination of this issue and a finding of the proper pro tanto reduction.

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Bluebook (online)
148 N.W.2d 438, 260 Iowa 87, 1967 Iowa Sup. LEXIS 720, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-estate-of-goeders-v-fillenwarth-iowa-1967.