Watts v. Farmers National Co.

146 N.W.2d 279, 259 Iowa 894, 1966 Iowa Sup. LEXIS 893
CourtSupreme Court of Iowa
DecidedNovember 15, 1966
DocketNo. 52269
StatusPublished

This text of 146 N.W.2d 279 (Watts v. Farmers National Co.) 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
Watts v. Farmers National Co., 146 N.W.2d 279, 259 Iowa 894, 1966 Iowa Sup. LEXIS 893 (iowa 1966).

Opinion

Becker, J.

Plaintiffs were common owners of 139 acres of unimproved land in Webster County. Defendant Sidney J. Danielson owned an adjoining tract containing 96.7 acres, which had farm buildings on it. For a number of years the two pieces had been rented and worked as one farm. This had been accomplished by plaintiffs leasing their 139 acres to Danielson who in turn rented it to the actual farm tenant.

In 1961 Danielson hired defendant Farmers National Company, a farm managing concern, to lease the farm to new tenants, look after accounting and see that correct cropping practices were followed. By correspondence to Mr. Alex Miller, attorney for plaintiffs who handled the entire matter for them, the company suggested that the necessary lease between plaintiffs and Danielson be handled directly. This was done. Before the lease was actually signed by all parties, but after advice from plaintiffs’ attorney that the lease would be signed, Farmers National, as agents, rented the entire farm to tenants Eiedesel on October 17, 1961. Plaintiffs’ lease to Danielson was dated October 7, 1961, but did not reach plaintiffs’ attorney until about November 3, 1961. The lease called for $2500 cash rent payable January 1, 1965.

Shortly after the leasing matter was settled and some time prior to January 16, 1965, Danielson authorized Farmers National to try to sell his 96.7 acres. The company sought and received permission to try to sell plaintiffs’ 139 acres. All parties contemplated that the two pieces would be offered together. Plaintiffs’ attorney applied for and received court permission for [896]*896the lease, and later for the farm sale.

On March 8, 1962, Farmers National notified plaintiffs’ attorney that they had an offer from defendant Gross of $49,345 for plaintiffs’ property. The offer was. conditioned on buyer’s ability to buy the Danielson property. The letter of transmittal contained the following paragraph:

“Since you have already received the $2,500.00 from Mr. Danielson for the 1962 lease, the purchaser is taking credit for that amount and will expect to pay the 1962 taxes payable iu 1963.”

The offer itself contained the following pertinent parts:

“I agree to pay for said premises the total sum of Forty-nine Thousand Three Hundred Forty-five and no/100 ($49,345.00) Dollars on the following terms:
“$2,000.00 cash, earnest money herewith.
“$2,500.00 cash paid to Sidney Danielson for assignment of 1962 lease.
“$44,845.00 cash on delivery of warranty deed to me on or before December 15, 1962. * * *
“Purchase subject to 1962 lease and possession by Gerald Riedesel.
“I am to pay the taxes beginning with the year 1963, payable in 1964. I am to have possession of said premises on or about December 15, 1962. Subject to the rights of the tenant under Ms lease. Buyer to pay 1962 taxes payable in 1963. Robert Gross Purchaser.”

Plaintiffs’ attorney, Mr. Miller, immediately replied to this offer with the following:

“We acknowledge your letter of March 8, 1962 and enclosed Proposition to Purchase Land.
“There is one slight error in your letter, wherein you state we have received $2,500.00 from Mr. Danielson for the 1962 lease.
“Our records show that Sidney Danielson entered into a lease with our clients on September 27, 1960, leasing the Webster County farm from March 1, 1961 to February 28, 1962 for $2,500.00 payable January 1, 1962, which has been paid.
“On October 7, 1961, Sidney Danielson entered into a lease from March 1, 1962 to February 28, 1963 for $2,500.00 payable [897]*897January 1, 1963. This item has not been paid, therefore Mr. Sidney Danielson is not entitled to this amount for an assignment, but our clients are entitled to the $2,500.00. We trust you can correct your records accordingly.
“We will submit the offer to our clients and advise you of their decision.”

Farmers National replied:

“Thank you for your letter explaining the $2,500.00 cash payment for rental and I now understand that the 1962 rental payment has not yet been made, in fact it’s not due until January 1, 1963.
“It is noted that you are submitting the purchase offer to your clients and will advise us of their decision.”

Mr. Miller, after consulting his clients, drew a red line through the “$2,500.00 cash paid to Sidney Danielson for assignment of 1962 lease”, changed the figure “$44,846.00” to “$47,-345.00” and signed the acceptance as plaintiffs’ attorney and agent on March 23,1962. The offer as changed was later initialed by Mr. Gross. No further mention of the lease money was made until after the transaction was closed on December 12, 1962. Plaintiffs’ attorney, Mr. Miller, Mr. Gross as buyer and representatives of Farmers National were all present at the closing. Apparently all parties agreed on all terms but none mentioned the lease money.

On December 21, 1962, Mr. Miller wrote Mr. Danielson to remind him that he expected the $2500 rent to be paid promptly on January 3, 1963. Danielson answered a second more insistent letter dated January 8, 1963, denying liability and referring Mr. Miller to Mr. Gross and Farmers National as he had subleased to Gross and Gross got the 1962 crop. Both Farmers National and Gross take the position that the 1962 rent was paid as part of the sale transaction as reflected in the foregoing contract and correspondence.

I. An undivided portion of plaintiffs’ property was owned by individuals whose affairs were handled under guardianship. Therefore, all leases and deeds affecting their interest had to be and were court approved. Apparently because of this situation this case was instituted and tried in probate without objection.

[898]*898While this action seeking damages on the grounds of fraud would normally be an ordinary proceeding (at law), Watson v. Bartholomew, 106 Iowa 576, 76 N.W. 858; Friedman v. City of Forest City, 239 Iowa 112, 30 N.W.2d 752; Newton v. Grundy Center, 246 Iowa 916, 70 NW.2d 162, we now have the new probate section, Code, 1966, section 633.33, which provides that with certain exceptions not material here all probate actions are to be tried in equity. It is difficult to detect from the record whether the parties tried this as a law case or an equity case, we conclude that it was treated as an equity matter. We, therefore, review the case de novo. O’Dell v. O’Dell, 238 Iowa 434, 26 N.W.2d 401; Simpson v. Bostwick, 248 Iowa 238, 80 N.W.2d 339. This conforms both with the dictates of the Probate Code as now in force and the apparent action of the parties.

II. The facts have been necessarily foreshortened. The record contains much additional detail concerning the events leading up to the transaction none of which is determinative. It also contains a great amount of detail as to letters between the parties after the transaction, none of which is helpful and most of which is inadmissible.

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Bluebook (online)
146 N.W.2d 279, 259 Iowa 894, 1966 Iowa Sup. LEXIS 893, Counsel Stack Legal Research, https://law.counselstack.com/opinion/watts-v-farmers-national-co-iowa-1966.