McCloud v. Bates

270 N.W. 373, 222 Iowa 1047
CourtSupreme Court of Iowa
DecidedDecember 15, 1936
DocketNo. 43564.
StatusPublished

This text of 270 N.W. 373 (McCloud v. Bates) 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
McCloud v. Bates, 270 N.W. 373, 222 Iowa 1047 (iowa 1936).

Opinion

Mitchell, J.

The case of McCloud v. Bates et al. was tried in the district court of Delaware county, Iowa, and decree was entered, dismissing the plaintiff’s petition. Plaintiff appealed to the Supreme Court of Iowa and the cause was reversed. See McCloud v. Bates, 220 Iowa 252, 261 N. W. 766. Procedendo was duly issued and filed in the office of the clerk of the district court of Delaware County, Iowa, on the 24th day of September, 1935. Thereafter the plaintiff filed in said cause a motion for judgment and decree. The trial court found that the plaintiff was entitled to entry of decree only in compliance with the contract pleaded and testified to by her and tenders made by her in pleadings and testimony; and further found that upon' the payment by plaintiff to the defendant-receiver of the sums of money obtained by her as dividends upon her deposits, and upon assigning to the receiver all claims to further dividends, decree would be entered in accordance with her original petition.

Plaintiff was not satisfied with this and has appealed to this court.

This is the second time that the writer of this opinion has been confronted with the record in this case, and, while a Supreme Court judge may not understand the record at the first reading, after reading it twice even he becomes familiar therewith.

Asenath McCloud in November of 1933 instituted an action in the district court of Delaware county, Iowa, against the receiver of the Delaware County State Bank and the sheriff of said county, asking that the title to certain real estate, described in her petition, be quieted as against the adverse claims of the defendants, and that a certain judgment which the receiver of the Delaware County State Bank had obtained against her husband be decreed not to be a lien upon said real estate, and that the de *1049 fendants be enjoined from enforcing said judgment against said described property. In her petition she alleged that she was the absolute owner of the real estate and that it had been transferred to her'some time before by her husband, Edward McCloud, pursuant to an oral arrangement, in which she claimed that her husband was indebted to her in a certain amount, and in addition thereto, as -a part of the consideration for the transfer by her husband to her of the 380-acre farm, she would permit any deposit which she then had in the Delaware County State Bank to be applied upon any indebtedness which her said husband then owed said bank. This was the allegation of her petition. She tendered into court the amount which she had received by way of dividends upon her deposit in the Delaware County State Bank and offered to assign and turn over to the bank her certificates in said institution. Not only did she state this in her petition but she came into open court, and, taking the witness stand, testified as follows:

“The money I refer to was deposited in the Delaware County State Bank and that is the bank to which my husband owed the money. I am willing that the dividend that is declared by the Delaware County State Bank should be applied on my husband’s note, as I agreed with him it might be.”

Mrs. McCloud had two certificates of deposit. One was in the sum of $2,020, and the other in the sum of $1,300. At no time during the first trial in the lower court, or during the submission of the appeal in this court, or in any of the written briefs, did Mrs. McCloud ever claim that the receiver was not entitled to the dividends she received upon the deposits she had in the bank and to an assignment of the certificates. It was upon that basis that the case was submitted in this court, and it was upon that theory that the first opinion in this case was written and the case reversed and remanded. The relief which Mrs. McCloud asked in this court in the first submission of this case was that the title to the real estate involved be quieted in her. She did not claim she had any interest in these certificates in the Delaware County State Bank, and proclaimed that a part of the consideration for the transfer of this 380-acre farm was the assignment and turning over by her of these certificates to her husband. This court said at page 256 of 220 Iowa [261 N. W. 768]:

*1050 “In addition to that, she had certain money on deposit in the Delaware County State Bank, which she was turning over to her husband in consideration of this transfer.”

At no time did Mrs. McCloud or her counsel make any claim that she was entitled to the dividends upon the certificates of deposit in the Delaware County Bank, until after this casé had .been reversed by this court and sent back to the lower court. At all times she claimed that the receiver was entitled to these dividends and she tendered them into court and so testified upon the witness stand. After the procedendo was returned from this court Mrs. McCloud asked that she be given not alone the land free and clear from any claim of the receivei’, but that she also was entitled to the dividends paid upon these certificates of deposit, which she several years before had turned over to her husband as part of the consideration of the transfer of the 380-acre farm. The maxim that “he who seeks equity must do equity” has direct application to the situation here presented. Mrs. McCloud in this case seeks to uphold her title to real estate which she alleges was conveyed to her under an oral arrangement, one of the terms of which she pleads was that “she would permit any deposit which she then had in the Delaware County State Bank to be applied upon any indebtedness which the said Edward McCloud then owed said bank.”

In 10 R. C. L., at pages 392-3 we find the following:

“Anyone going into a court of equity and asking its aid, whether that aid be such as could be obtained in a court of law, or whether it be of a character obtainable only in a court of equity, submits himself, to the jurisdiction of the court, and in asking its aid subjects himself to the imposition of such terms as well-established equitable principles would require. This principle expressed in the form of the maxim, ‘he who seeks equity must do equity, ’ is almost as old as the tribunal to which it applies, and since courts of equity refuse to recognize and protect equitable rights unless such rights are based on conscience and good faith, it may be regarded as one of the cardinal .rules of equity. It pervades the entire field of equity jurisprudence. Thus, one who seeks by a bill in equity to rescind a contract of sale for fraud on the part of the purchaser must, as a condition precedent, offer to repay the purchase price. So where a person in peaceable possession under claim of lawful title has in good *1051 faith paid assessments and made permanent improvements, the true owner who seeks the aid of equity to establish his title will be compelled to reimburse the occupant for his expenditures. That an infant must restore the property which he obtains on a contract where he has been guilty of deceit or fraud before he can avoid it is also the universal rule in equity. The maxim is also applicable to all complainants seeking relief from judgments against them. And the doctrine of equitable elections rests on the same principle.

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Related

McCloud v. Bates
261 N.W. 766 (Supreme Court of Iowa, 1935)

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Bluebook (online)
270 N.W. 373, 222 Iowa 1047, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mccloud-v-bates-iowa-1936.