Iowa Loan & Trust Co. v. Schnose

Citations

• 19 S.D. 248
• 103 N.W. 22
• 1905 S.D. LEXIS 33

Syllabus

<p>1.' Under Rev. Civ. Code, §§ 1189,1194,1196,1205,1206, declaring that consent is essential to the existence of a contract, that it is not free when obtained through mistake, and that a mistake in fact is a mistake not caused by the neglect of a legal duty, where defendants believed when they contracted for an extension of time on assuming a mortgage that they had a legal title to the .property subject to the mortgage, and plaintiff believed when it accepted the mortgage that it was securing a valid lien, and, at the time of the extension, had no notice that the mortgage was invalid, the contract of extension was not binding, because, of the mistake.</p> <p>2. Payments of interest having been made on a note and mortgage under the belief that defendants had acquired the legal title to the property, they were entitled to recover them as a counter claim in an action on the note.</p> <p>3. Where limitations were not pleaded to a counterclaim for interest paid on the note sued on, recovery could not be restricted to payments made within six years prior to the action.</p> <p>4. Where a mortgagor conveyed the property to a grantee, who assumed payment of the mortgage with knowledge of the mortgagee, the mortgagor became surety, and an extension of time of payment granted without his knowledge or consent extinguished his liability.</p> <p>5. Where more than six years have elapsed since a cause of action accrued on a note against a defendant, and he has paid no interest thereon since 1890, the note is barred by limitations.</p> <p>6. Where, in an action on a note alleged to have been executed in Iowa, the law of that state is not pleaded or introduced in evidence, it must be presumed identical with the law of the forum as to the effect of an extension releasing a surety.</p>