Opinion
No. 4-570 / 03-1727
Filed December 8, 2004
Appeal from the Iowa District Court for Ringgold County, Gary G. Kimes, Judge.
Alva Parker appeals the district court decision overruling his motion to set aside a sheriff's sale. AFFIRMED.
Kristina Kaeding of Kaeding Law Offices, Council Bluffs, for appellant.
August Landis of Whitfield Eddy, P.L.C., Des Moines, for appellee.
Heard by Huitink, P.J., and Vogel and Eisenhauer, JJ.
I. Background Facts Proceedings
In 1996 Vulcano Industries, Inc. borrowed the amounts of $116,000 and $25,000 from Central Bank of Kansas City (Bank), as shown by two promissory notes. The notes were secured by Vulcano's business equipment and a mortgage on 200 acres of farmland owned by Alva Parker. Eventually, Vulcano defaulted on the notes.
On August 2, 2000, the Bank filed a lis pendens action seeking to enforce its security interests. The business assets were repossessed and sold, netting sale proceeds of $6500, which were applied to Vulcano's debt. The Bank also sought to foreclose on the mortgage. On June 13, 2001, the district court ruled that the Bank could foreclose the mortgage and that the property should be sold at a public auction.
Parker appealed and filed a supersedeas bond. A stay was granted by the district court, halting the scheduled sale of the property. We "affirm[ed] the district court's entry of a foreclosure judgment against Parker's real estate." Central Bank v. Parker, No. 01-1156 (Iowa Ct.App. Dec. 11, 2002). Procedendo issued on January 14, 2003.
The issue in this appeal was whether the Bank was entitled to a judgment of foreclosure because it had not complied with the notice requirements of Missouri Revised Statutes section 400.9-504(3) (2001). Central Bank v. Parker, No. 01-1156 (Iowa Ct. App. Dec. 11, 2002). We determined the statute did not apply because the Bank was not seeking a deficiency judgment, and concluded the foreclosure could proceed. Id.
In May 2003 the Bank contacted the sheriff of Ringgold County to begin the process to sell the property. At the same time, the Bank sent a letter to Parker's attorney stating that because the appeal was complete the Bank intended to go ahead with the sale. Notice of the sheriff's sale was posted and published in a newspaper, as required by Iowa Code section 626.75 (2003). At the sale, held on August 15, 2003, the property was sold to the highest bidder for $195,000.
On September 4, 2003, Parker filed a motion to set aside the sale, claiming he was a debtor in "actual occupation and possession" of the land and under section 626.78 he should have received written notice of the sale. He asserted he should be able to redeem the property. The Bank resisted, claiming that by obtaining a stay of execution, Parker waived his redemption rights. See Iowa Code § 628.4. The Bank also disputed Parker's assertion that he was in "actual occupation and possession" of the land in the time period of May to August 2003.
After a hearing, the district court entered an order which stated:
Defendant's motion to set aside foreclosure sale is overruled for all the reasons set forth in Plaintiff's resistance. The Court finds the Defendant waived his homestead rights by the mortgage. Further, Defendant waived redemption rights by obtaining a stay pending appeal.
Parker appeals.
II. Standard of Review
Our scope of review in this equitable action is de novo. Iowa R. App. P. 6.4. In equity cases, especially when considering the credibility of witnesses, we give weight to the fact findings of the district court, but are not bound by them. Iowa R. App. P. 6.14(6)( g).
III. Waiver of Appeal
The Bank contends that having chosen to invoke a stay of execution in connection with the previous appeal, Parker is now barred from appealing this case. Section 626.60 provides "[n]o appeal shall be allowed after a stay of execution has been obtained."
There are three types of stays of execution: (1) those which are ordered by the court in which the judgment was rendered and which seek a postponement or reversal of the judgment; (2) those which arise from appellate proceedings; and (3) those which result from statutes granting a debtor additional time to satisfy a judgment in exchange for certain security. McGough v. Gabus, 526 N.W.2d 328, 330-31 (Iowa 1995) (citations omitted).
A stay as permitted by Iowa Rule of Civil Procedure 1.1006, for consideration of post-trial motions, is considered to come within the first class of stays. Netteland v. Farm Bureau Life Ins. Co., 510 N.W.2d 162, 169 (Iowa Ct.App. 1993). A stay pursuant to rule 1.1006 does not waive the right to appeal. McGough, 526 N.W.2d at 331; Netteland, 510 N.W.2d at 169. The supreme court has noted "the desirability of allowing adequate time, through a stay, to dispose of post-trial motions without losing the right of appeal." McGough, 526 N.W.2d at 331.
A stay under section 626.58 may be considered the third type of stay, because the statute permits a debtor additional time to pay a debt, upon obtaining sureties. If a debtor obtains a stay of execution under section 626.58, then the right of appeal has been waived. Wilsey v. Maynard, 21 Iowa 107, 109, (1866) ("By entry of stay he waives his right of appeal."); Seacrest v. Newman, 19 Iowa 323, 324 (1865) ("The right of appeal, after taking the benefit of the stay law, was cut off.").
The question in the present case, however, is whether a stay of execution in a previous appeal will waive the right to bring a subsequent appeal of the same judgment, and thus involves the second type of stay. In Omaha Bank for Cooperatives v. Siouxland Cattle Cooperative, 305 N.W.2d 458, 465 (Iowa 1981), a stay was granting during the appeal of a mortgage foreclosure action. Once the appeal was completed, Omaha Bank executed on its foreclosure judgment. Omaha Bank, 305 N.W.2d at 465. The supreme court concluded "the various appeals and stays in the equity action cut off Siouxland's redemption rights." Id.; see also Iowa Code § 628.4 ("A party who has stayed execution on the judgment is not entitled to redeem."). The court noted that if it "allow[ed the debtor] to stall execution on the foreclosure judgment until all appeals and retrials of the law action were determined, we would be ignoring the right of the bank to foreclose." Omaha Bank, 305 N.W.2d at 466.
We find that section 626.60, like section 628.4, "prevent[s] the unfair extension of the redemptive period by delaying tactics." See First Nat'l Bank v. Matt Bauer Farms Corp., 408 N.W.2d 51, 54 (Iowa 1987) (citing Farmers Trust Savs. Bank v. Manning, 359 N.W.2d 461, 464 (Iowa 1984)). It also makes title more marketable. Id. Considering section 628.4, a debtor who by a stay "delayed the sale, should not be entitled to avail himself of that delay, and also retain the right of redemption." Fitch v. Cornelison, 224 Iowa 1252, 1255, 278 N.W. 309, 310 (1938). Similarly, under section 626.60, a party who obtains a stay and delays a sale through one appeal should not be entitled to delay matters through a second appeal of the same judgment.
We conclude that under the particular facts of this case, where Parker obtained a stay of execution during the previous appellate proceedings, the stay operates as a waiver of any further appeal. We note:
Under section 628.4, the stay in the previous appeal also acts to prohibit Parker from redeeming the property.
Under a statutory provision to the effect that no proceeding in error or appeal shall be allowed after a stay of execution has been obtained, the taking of such a stay by a defendant in a judgment operates as a waiver of the right of appeal or error.
4 C.J.S. Appeal Error § 185(b), at 257 (1993) (footnote omitted). The original foreclosure judgment was entered on June 13, 2001, and execution of the judgment has already been delayed for a considerable period of time. We conclude Parker has waived his right to appeal.
IV. Actual Occupation Possession
Even if Parker had not waived his right to appeal, we would find against Parker on the merits of his appeal. Parker claimed he was in "actual occupation and possession" of the land, and under section 626.78 he was entitled to notice of the sale. Section 626.79 provides, "Sales made without the notice required in section 626.78 may be set aside on motion made within ninety days thereafter."
In Iowa, there is a strong presumption in favor of an execution sale. South Ottumwa Sav. Bank v. Sedore, 394 N.W.2d 349, 351 (Iowa 1986). "In the absence of fraud, collusion, or other substantial and justifiable prejudice, mere irregularities in the procedures leading to or following an execution sale will not support a debtor's motion to set aside the sale." Id. The words "actual occupation and possession" have been construed to mean "a true, real, genuine, positive, and certain possession, and not a virtual or theoretical possession." King v. Wallace Bros., 78 Iowa 221, 226, 42 N.W. 776, 777 (1889).
The evidence does not support Parker's claim that he was in actual occupation and possession of the land during the relevant time period. The county sheriff testified he had never seen Parker in residence at the farm until after the sale, and then only on one day. Parker admitted he lived in Texas until May 2003, and then went on an extended trip to California in July 2003, leaving only a short period of time when he might have lived in Iowa.
We affirm the decision of the district court.