Waterman, J.
[12]*121 [11]*11Tbe case was submitted in great part upon stipulated facts. Tbe statement in tbe record is so lengthy we shall venture to abridge it. Some additional matters of wbicb testimony was taken will be noticed in tbe course of tbe opinion. In tbe year 1884 tbe defendant was a member of three firms, each of wbicb was engaged in the [12]*12real estate and loan business. The place of business of one of these firms was at Emmetsburg, in this state; the other two were located in South Dakota. The Dakota firms had made loans to and taken notes secured by deeds of trust upon real estate fromDaniel R. Iiaynes, Patrick Kelley, Jesse PI. Conrad, and Josiah W. Lamb, respectively. The defendant was the trustee named in these deeds. In June, 1885, the American Investment Company was organized, and absorbed the business of all these firms. Defendant was president of the company until July 1,1891, and thereafter was a member of its board of directors. In each of the loans mentioned except that of Kelley, the borrowers gave notes for comlmission,' and executed second mortgages to secure their payment. Default having been made by each of these four debtors, foreclosure proceedings were instituted, the real estate sold, and title taken in the name of E. S. Ormsby, trustee, but without his knowledge at the time. In all except the Kelley case the foreclosure was hád of the commission mortgages. In the Kelley matter the foreclosure was of the principal mortgage, the only one given. The investment company took up these various loans, and defendant, in his name, as trustee, executed new interest notes or coupons in each of these cases covering a period of five years after the date of the maturity of the original notes. In each of these coupons the principal note was described, followed by this agreement, “Which note I assume and agree to pay.” These interest notes were signed, “E. S. Ormsby, Trustee.” A separate agreement as to each note was also' signed in the same manner by defendant, and also by the original payee, in which the time of payment of the principal was extended for the period just mentioned; and in this agreement it was recited that Ormsby, trustee, was the owner of the .land. Prior to this time, the investment company, desiring to issue its debenture bonds for sale on the market, undertook to malee provision for securing their payment, and to do this it appointed George H. Carr, Elden J. Hartshorn, and John [13]*13J. Watson, trustees, who, by agreement, were to take and hold securities as collateral for the benefit of purchasers of such bonds. These notes, with the extension agreements and the new interest coupons, were in due time deposited with the trustees as collateral, and together with other paper, and. debenture bonds aggregating, a large amount were placed on the market and sold. The original notes in question were payable two to one Higgins, and two to one Graves, and were endorsed by their respective payees in this form: “Pay to the order of-, without recourse,” and this was duly signed. In December, 1896, the investment company, having defaulted in the payment of its debenture bonds, the trustees named, Oarr, Hartshorn, and Watson, sold the col-laterals at public sale, and plaintiff purchased, and now owns, the Haynes, Oonrad, Lamb, and Ifelley notes, with the agreements relating thereto, of which we haye spoken. This action is an attempt to enforce a personal liability against Ormsby.
2 3 II. On the face of these papers Ormsby is personally liable. Counsel do not disagree as to this. The ultimate question presented for our determination is as to defendant’s right to have the contracts reformed. Preliminary to this, however, a number of other issues are raised by the defense. It is maintained that these extension agreements and promises to pay, made by Ormsby, were without consideration; that the papers sued on were nonnegotiable; that Ormsby was not the real owner of the real •estate covered by the mortgages, but held only the bare legal title for the benefit of the investment company; that he did not intend to incur any personal responsibility in signing the agreements and coupons; that the liability thereon was in fact that of the investment company, and that the trustees for the debenture creditors knew these facts when they received this paper; and it is claimed this notice to the trustees will, in law, be deemed notice to their cestuis que trust. Upon the question whether notice to trustees of this character [14]*14is notice to the beneficiaries, the authorities seem to> be in conflict. As we dispose of the controversy on other grounds, we need not» analyze the cases, nor do more than, say that in pach of those cited by defendant the question arose between creditors whose rights were in conflict, while here the issue is between a creditor and one who> had a duty to perform in creating the trust. But, for the purpose of this case, let us say the-holders of the debenture bonds were bound by any knowledge had by the trustees of facts which affected the validity of such securities, and it then becomes necessary to determine what the facts were as to thfe execution of these papers by Ormsby, and what knowledge the trustees had. These securities purported to be real estate mortgages, with the personal obligation of Ormsby added. There .was a deliberate purpose in having them signed as they were instead of by the investment company. The president of the company, a brother of defendant, and who testified in his behalf, says: “I think the reason we made these extensions in the name of E. S. Ormsby, trustee, instead of the name of the American Investment Company, was that some of them went east to eastern holders of first mortgages, where we held title, or the title was in the name of O. E. Bliven, trustee, or E. S. Ormsby, trustee; and I think we wished them to think as much as possible that it was a straight loan, — all right; that it was bona fide collateral ; where, if we put them in the name of the company, they might have thought it was not a bona fide collateral security. We did not do it particularly to deceive our customers. We guaranteed them, and expected to pay them.” If this means anything, it means that these papers were executed by Ormsby so that it might not be known they were obligations of the investment company. While it is true, defendant does not admit this, his denial is hesitating, and not direct, and the statement of the president is corroborated by all the surrounding circumstances. Although in three of the instances these papers might have been treated as col[15]*15lateral, even, though the agreements had been signed by the investment company, because real estate was pledged, they would have lacked any personal obligation on the agreements outside that of the principal debtor, who was already bound. But in one case — that of Kelley — the principal mortgage had been foreclosed. The note was merged in the judgment, and we have nothing to show but that the judgment was paid by the purchase of the land on foreclosure. Had the investment company signed the agreement in this case, it would not have been any security at all. And in none of the cases would ihe collateral have been the same, or so valuable, as it would with the obligation of some third person added.
[16]*164 5 [15]*15Digressing now for a moment, let us see what thp trustees had notice of in relation to this matter. Watson is the only one of them who testifies on this point.
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Waterman, J.
[12]*121 [11]*11Tbe case was submitted in great part upon stipulated facts. Tbe statement in tbe record is so lengthy we shall venture to abridge it. Some additional matters of wbicb testimony was taken will be noticed in tbe course of tbe opinion. In tbe year 1884 tbe defendant was a member of three firms, each of wbicb was engaged in the [12]*12real estate and loan business. The place of business of one of these firms was at Emmetsburg, in this state; the other two were located in South Dakota. The Dakota firms had made loans to and taken notes secured by deeds of trust upon real estate fromDaniel R. Iiaynes, Patrick Kelley, Jesse PI. Conrad, and Josiah W. Lamb, respectively. The defendant was the trustee named in these deeds. In June, 1885, the American Investment Company was organized, and absorbed the business of all these firms. Defendant was president of the company until July 1,1891, and thereafter was a member of its board of directors. In each of the loans mentioned except that of Kelley, the borrowers gave notes for comlmission,' and executed second mortgages to secure their payment. Default having been made by each of these four debtors, foreclosure proceedings were instituted, the real estate sold, and title taken in the name of E. S. Ormsby, trustee, but without his knowledge at the time. In all except the Kelley case the foreclosure was hád of the commission mortgages. In the Kelley matter the foreclosure was of the principal mortgage, the only one given. The investment company took up these various loans, and defendant, in his name, as trustee, executed new interest notes or coupons in each of these cases covering a period of five years after the date of the maturity of the original notes. In each of these coupons the principal note was described, followed by this agreement, “Which note I assume and agree to pay.” These interest notes were signed, “E. S. Ormsby, Trustee.” A separate agreement as to each note was also' signed in the same manner by defendant, and also by the original payee, in which the time of payment of the principal was extended for the period just mentioned; and in this agreement it was recited that Ormsby, trustee, was the owner of the .land. Prior to this time, the investment company, desiring to issue its debenture bonds for sale on the market, undertook to malee provision for securing their payment, and to do this it appointed George H. Carr, Elden J. Hartshorn, and John [13]*13J. Watson, trustees, who, by agreement, were to take and hold securities as collateral for the benefit of purchasers of such bonds. These notes, with the extension agreements and the new interest coupons, were in due time deposited with the trustees as collateral, and together with other paper, and. debenture bonds aggregating, a large amount were placed on the market and sold. The original notes in question were payable two to one Higgins, and two to one Graves, and were endorsed by their respective payees in this form: “Pay to the order of-, without recourse,” and this was duly signed. In December, 1896, the investment company, having defaulted in the payment of its debenture bonds, the trustees named, Oarr, Hartshorn, and Watson, sold the col-laterals at public sale, and plaintiff purchased, and now owns, the Haynes, Oonrad, Lamb, and Ifelley notes, with the agreements relating thereto, of which we haye spoken. This action is an attempt to enforce a personal liability against Ormsby.
2 3 II. On the face of these papers Ormsby is personally liable. Counsel do not disagree as to this. The ultimate question presented for our determination is as to defendant’s right to have the contracts reformed. Preliminary to this, however, a number of other issues are raised by the defense. It is maintained that these extension agreements and promises to pay, made by Ormsby, were without consideration; that the papers sued on were nonnegotiable; that Ormsby was not the real owner of the real •estate covered by the mortgages, but held only the bare legal title for the benefit of the investment company; that he did not intend to incur any personal responsibility in signing the agreements and coupons; that the liability thereon was in fact that of the investment company, and that the trustees for the debenture creditors knew these facts when they received this paper; and it is claimed this notice to the trustees will, in law, be deemed notice to their cestuis que trust. Upon the question whether notice to trustees of this character [14]*14is notice to the beneficiaries, the authorities seem to> be in conflict. As we dispose of the controversy on other grounds, we need not» analyze the cases, nor do more than, say that in pach of those cited by defendant the question arose between creditors whose rights were in conflict, while here the issue is between a creditor and one who> had a duty to perform in creating the trust. But, for the purpose of this case, let us say the-holders of the debenture bonds were bound by any knowledge had by the trustees of facts which affected the validity of such securities, and it then becomes necessary to determine what the facts were as to thfe execution of these papers by Ormsby, and what knowledge the trustees had. These securities purported to be real estate mortgages, with the personal obligation of Ormsby added. There .was a deliberate purpose in having them signed as they were instead of by the investment company. The president of the company, a brother of defendant, and who testified in his behalf, says: “I think the reason we made these extensions in the name of E. S. Ormsby, trustee, instead of the name of the American Investment Company, was that some of them went east to eastern holders of first mortgages, where we held title, or the title was in the name of O. E. Bliven, trustee, or E. S. Ormsby, trustee; and I think we wished them to think as much as possible that it was a straight loan, — all right; that it was bona fide collateral ; where, if we put them in the name of the company, they might have thought it was not a bona fide collateral security. We did not do it particularly to deceive our customers. We guaranteed them, and expected to pay them.” If this means anything, it means that these papers were executed by Ormsby so that it might not be known they were obligations of the investment company. While it is true, defendant does not admit this, his denial is hesitating, and not direct, and the statement of the president is corroborated by all the surrounding circumstances. Although in three of the instances these papers might have been treated as col[15]*15lateral, even, though the agreements had been signed by the investment company, because real estate was pledged, they would have lacked any personal obligation on the agreements outside that of the principal debtor, who was already bound. But in one case — that of Kelley — the principal mortgage had been foreclosed. The note was merged in the judgment, and we have nothing to show but that the judgment was paid by the purchase of the land on foreclosure. Had the investment company signed the agreement in this case, it would not have been any security at all. And in none of the cases would ihe collateral have been the same, or so valuable, as it would with the obligation of some third person added.
[16]*164 5 [15]*15Digressing now for a moment, let us see what thp trustees had notice of in relation to this matter. Watson is the only one of them who testifies on this point. He says: “I knew, at the time of taking these securities, that the American Investment Company held the legal title to these lands, and that they had taken up these securities, and that they were the owners of both land and securities. Also that defendant held the naked legal title for the company, and that he received no consideration for signing these extension agreements ; that is, I knew it in a general way. * * * We did not consider the question of holding E. S. Ormsby personally liable. * * * At the time we received, these papers, I did not consider E. S. Ormsby was personally responsible on them.” It will be noticed that the witness does not say that he or any of the trustees knew or suspected that the papers were executed in Ormsby’s name purposely to conceal the fact that they were the obligations of the investment company. But, if the facts shown by the testimony had all been known to the trustees or bondholders, then knowledge could not aid plaintiff. When these agreements were deliberately executed in the manner adopted for the purpose of inducing the bondholders to believe they were the obligations of a third party, it leaves Ormsby without stand[16]*16ing in a court of equity to ask a reformation that will exonerate him from liability. The conduct of the parties was, in effect, a representation that the investment company was not liable on this paper; that the agreements were the obligations of Ormsby. After acquiring an advantage on the strength of such- representation, we cannot understand how Ormsby can be now heard to say these representations were not true. Granted, for the sake of argument, that plaintiff was informed, when he purchased this paper, that Ormsby claimed not to be personally liable thereon, and how does this avail'? Ormsby can claim no greater right against plaintiff than against plaintiff’s assignors. Had the intention been to express the liability of the investment company by the execution of those agreements, and the failure occurred through mistake of law or fact, doubtless a reformation could be had at Orsmby’s instance. Bank v. Swan, 100 Iowa 718; Lee v. Percival, 85 Iowa, 639. This, however, is not the case. As we have shown, there'was no mistake. The manner of execution expressed just what was intended. To permit a reformation Here would be to allow defendant to take advantage of his own wrong, and, if no reformation is had, plaintiff is- entitled to recover (Banh v. Swanson, supra, and cases therein cited), for there was a sufficient consideration for the promise in the detriment to the promisees, the bondholders. The decree of the distinct court must be reversed.