Low v. Henry

9 Cal. 538 | Cal. | 1858

Lead Opinion

Burnett, J.

This was a bill to restrain the sale of certain premises on executions issued out of the District Court. The defendants demurred to the complaint; the demurrer was sustained, and the plaintiffs appealed. The facts alleged in the complaint were, concisely, these :

1. On the eleventh of May, 1854, Daniel H. Haskell conveyed the premises in dispute, by deed, to Alvin Adams, which deed was recorded May 16, 1854. This deed was absolute on its face, and recites a consideration of $21,000.

2. XJpon the same day, Alvin Adams executed his bond to Daniel H. Haskell and Isaiah C. Woods, in which he binds himself to do two things—’provided said Woods and Haskell should pay him the sum of $22,050, on or before the eleventh day of November, 1854—namely: first, to convey to them the same premises by warranty-deed; second, to permit them, in the meantime, to occupy the premises free of rent.

3. That Haskell conveyed the premises to plaintiffs August 9, 1855, which deed was recorded September 1, 1855; and that plaintiffs then took possession of the premises, and have always had possession since that time.

4. That on the ninth of August, 1855, said Woods and Haskell assigned the bond of Adams to the plaintiffs, which assignment was recorded September 6, 1855.

5. That Alvin Adams, by deed delivered August 28, 1855, conveyed the premises to plaintiffs, which deed was recorded Aug. 31, 1855.

6. That defendant Henry, on the twenty-sixth day of May, 1855, sued Adams & Co., and attached the premises in controversy; that the attachment was issued before the summons; that judgment was had September 3, 1855, for $5,907 69, to bo enforced against the joint property of all the defendants and the individual property of Woods; that afterwards proceedings were had, whereby, on the thirteenth of May, 1856, it was adjudged that the judgment be enforced against the separate property of Adams.

7. That the defendant Kinder sued Adams & Co. June 2,1855, attached the premises June 4,1855, and obtained judgment January 23, 1856, for §3,341 60, so that it might be enforced against the joint property of all the defendants, and the separate property of Woods and Adams.

8. That Philip Schover sued Adams & Co., and attached the property June 20,1855, and obtained judgment January 23,1850, for §2,940 25, so that it might be enforced, against the joint property of all, and the separate property of Woods and Adams.

9. That defendant Young sued Adams & Co. June 26,1855, and attached the property and obtained judgment March 19, 1856, for $996 50, so that it might be enforced against the joint property of all, and the separate property of Wood and Adams.

10. That executions have been issued upon these four judgments, and delivered to the sheriff, who has levied upon the property and advertised the same for sale.

Conceding that the title to the premises in controversy was in plaintiffs at the date of the levy of the several executions, there can be no question as to their right to restrain the sale. (5 Page, 493; 5 Hammond, O. R., 178; 2 Ohio R., 471.) It is equally clear that if the title was in Adams & Co., or in Adams, at the time the attachment was levied, the complaint could not-be sustained, unless the liens of the attachment were subsequently lost.

There are three questions involved in the case:

1. Whether the transaction amounted to a mortgage or a conditional sale.

2. Whether the liens of the attachments were lost in consequence of the form in which the judgments were taken.

3. Whether the attachment in the case of Henry v. Adams & Co. was void.

In the case of Lee v. Evans, decided at the October Term, 1857, we held that parol evidence was not admissible to show that a deed, absolute upon its face, was intended as a mortgage, without alleging and proving fraud, accident, or mistake, in the creation of the instrument itself. That case was well considered; and we have since seen no reason to change our o}3inion. In considering the first question, we must, therefore, collect the intention of Adams, Woods, and Haskell, from what they have deliberately stated in the written instruments, and hold them to have meant what they said.

It is insisted by the learned counsel of plaintiffs, that the deed from Haskell to Adams, and the bond from Adams to Woods and Haskell, constituted but parts of the same instrument, and must be taken and construed together; and that when so construed the)' amount to a mortgage, and no more. These instruments be .r date the same day, were witnessed by the same person, acknowledged before the same officer, intrusted to a mutual agent, and describe the same property. When two instruments are executed at the same time, between the same parties, and about the same subject-matter, they may be considered as constituting parts of the same transaction. But in this case there is no reference in either instrument to the other; and they are between different parties. We think, however, though we do not expressly so decide, that the coincidences stated show that the deed anti bond should be taken and construed together as parts of the same transaction.

But if we consider the deed and bond as constituting together but one instrument, it is difficult to see how they can be construed to be a mortgage. The deed purports to be absolute upon its face. The bond is also clear and explicit. Nothing is said in either about a loan of money, or a pre-existing debt, or the payment of interest. It is true that the difference between the sum mentioned in the deed, and that stated in the bond, was §1,050 ¡ and that this sum amounts to just ten per centum per annum upon the §21,000—for the period elapsing between the date of the deed and the day when the §22,050 were to have been paid. But this coincidence is slight, and is overcome by the express covenant of the bond, that Adams was to charge no rent during that period. The increased sum was in lieu of rent.

The deed and b,ond were between different parties; and we know of no case "were it has ever been held that such a transaction could be a mortgage. On the contrary, it was held in the the case of Treat v. Strickland, (23 Maine Rep., 234,) that if land be conveyed, and at the same time a bond be given by the grantee to the grantor, and another to convey to them the same premises upon certain conditions, the instruments do not constitute a mortgage. A defeasance is “ an instrument which defeats the force or operation of some other deed or estate. That which in the same deed is called a condition, in another deed is a defeasance.” (Bouvier.) Had the clear intention of the parties, as expressed in the deed and bond, been fully carried out, the ffeed to Adams would not have been thereby defeated, and the property re-vested in Haskell, the maker of the deed; but the title would have passed from Adams to Haskell and Woods. The bond could not constitute a defeasance to the deed, for the reason that they must be between the same parties. (14 Pick., 479, and authorities there cited. 2 Blackstone, 327, 342.)

The bond of Adams, which is set out in full in the complaint, clearly treats Adams as the owner of the premises. He stipulated under a penalty of §44,000, that he would, “ upon tender ” to him of a sum, at a place, and on or before a time specified, convey to Woods and Haskell the premises described, without any charge of rent. The legal effect of the instrument is, that if the money was not tendered at the time and place mentioned, then Adams wms not bound to convey, and would, therefore, have had the right to charge a reasonable rent. No rent was to be charged by Adamsj provided the money was tendered at the place and time mentioned.

In the case of Conway’s Executor v Alexander, 7 Crunch, 237, it was said by Chief Justice Marshall: “In this case the form of the deed is not, in itself', conclusive either way. The want of a covenant to repay the money is not complete evidence that a conditional sale was intended, but is a circumstance of no inconsiderable importance.”

It will be seen, that the Court there lay down the rule, that “the want of a covenant to repay the money” is not conclusive of the intention of the parties. This position was laid down under the practice which permitted parol testimony to prove that a deed absolute upon its face, was intended as a mortgage. But while the form of the deed was not held as conclusive evidence of the intention of the parties, the Chief Justice said: “ It is, therefore, a necessary ingredient in a mortgage, that the mortgagee should have a remedy against the person of the debtor, if this remedy really exists, its not being reserved in terms will not effect the case. But it must exist in order to justify a construction which overrules the express words of the instrument.”

In the case of Goodman v. Grierson, 2 Ball & Beatty’s Rep., 279, it was said, by Lord Manners : “ The fair criterion by which the Court is to decide whether this deed be a mortgage or not, I apprehend to be this: are the remedies mutual and reciprocal ? Has the defendant all the remedies a mortgagee is entitled to?”

In the case of Flagg v. Mann, (14 Pick., 478,) it was held, that when there was no collateral undertaking to pay the money, that “ this fact, though not conclusive, is to be taken into consideration in ascertaining whether the transaction was a mortgage or a sale, with a contract for a re-purchase upon strict terms.”

It must be conceded that Lord Manners did not intend to lay it down as an inflexible rule, that mutuality must exist to constitute a mortgage; but only that it was a fair criterion by which to ascertain the intention of the parties. (1 Sand., 73.) And there would seem to be no doubt of the competency of parties to create a mortgage without this mutuality. For example, A might mortgage certain premises to B, to secure the payment of a specified sum, with the distinct understanding that B should look alone to the property for his security; but in case the mortgaged premises should sell for more than the debt, then the surplus to be the property of A. But in such a case, the intention of the parties should be expressed in clear and apt words, before a Court would give the instrument such a construction.

Heither in the deed of Haskell to Adams, nor in the bond of Adams to Woods and Haskell, is there a word to show any obligation on the part of Woods and Haskell to pay the sum specified in the deed or in the bond. We can find nothing making it their duty to pay the money. It is only stipulated, that if they did so tender it at the time and place mentioned, then Adams would do the two things stipulated by him to be done. There being no mutuality between the parties, and no apt and express words in the instruments, either taken together or singly, to show that the transaction amounted to a mortgage, and no parol testimony being admissible to prove it such, one must conclude that it was nota mortgage. And for the same reasons we are led to the conclusion that it was not an ordinary sale of land, where one party stipulates to pay the purchase-money and the other to convey the premises when the payment is made; but it was a sale in the nature of a conditional sale; and when the money was not tendered as specified, the premises remained the property of Adams, discharged from the covenants in the bond. (4 Kent, 148; 4 Denio, 493; 14 Pick., 467; 19 Wend., 518; 2 Ed. Ch. R., 138; 8 Paige, 243.) As such, it was liable for his debts and subject to the attachments issued in the cases stated.

It is urged by the learned counsel of plaintiffs, that, though the bond of defeasance be laid out of the question, still the demurrer should have been overruled, as plaintiffs might have been able, under their general allegation that the transaction was intended as a mortgage, to prove it such by other testimony. But this ground is not well taken. They had first shown the title in Adams by deed absolute, and they only alleged the bond as a defeasance. Their general allegation was limited and controlled by the particular allegation that followed. When a pleader assumes to set out the particulars of his case, he must be held to have done so.

We come now to consider the question as to whether the liens of the attachments were lost in consequence of the form in which the judgments were taken. The counsel of plaintiffs insist that the liens were lost “ by the fact that simple money-judgments were entered ujd, without any directions for the sale of the attached property.” The learned counsel go on to say : “Suppose a party should, on a suit to foreclose a mortgage, take judgment simply for the amount due; he could not, under such a judgment, proceed to sell the mortgaged premises so as to transfer the title from the date of the mortgage.”

In a foreclosure suit, one of the objects of the bill is to enforce a prior lion created by contract; and the decree of sale is a part of the relief prayed for in the complaint itself. The sale of the mortgaged premises, as such, only follows the express decree of the Court foreclosing the equity of redemption. (Code, § 246.) There are no directions given to the sheriff as to sales made under decrees of foreclosure, for the reason, that such sales are made under the directions of the Court, and not under execution.

But the case is different where property is attached as security for the judgment that may be thereafter recovered. There is no prayer in the complaint that the Court should order a sale of the attached property. The lien of the attachment arises after the commencement of the suit. The Code contains express directions to the sheriff as to property attached. (§§ 130, 132, 183.) He is directed to sell the property, if it be perishable, and to retain the proceeds to answer the judgment. There is nothing in the Code that requires any order of Court to authorize a sale. Eor these reasons, we think the objection not well taken.

The third and last point necessary to be examined is the question, whether the attachment issued in the case of Henry v. Adams & Co., as alleged in the complaint, was a nullity. The twenty-second section of the Practice Act provides that a suit shall be commenced by the filing of a complaint and the issuance of a summons; and the one hundred and twentieth section allows the plaintiff, “ at the time of issuing the summons, or at anytime afterwards,” to have the property of the defendants attached. These provisions must be strictly followed; and the attachment, if issued before the summons, is a nullity. (Ex Parte Cohen, 6 Cal. R., 318.) The issuance of the summons afterwards can not cure that wnich was void from the beginning. If we regard the attachment as void, there was no lien held by Henry upon the property at the date of the deeds to plaintiffs. The demurrer was to the whole complaint, and should have been sustained as to part, and overruled as to the residue.

It is but just to remark that the bill was framed before the decision in the case of Lee v. Evans, and that consequently many of the authorities referred to by counsel have no application to the case.

The judgment of the Court below is reversed, and the cause remanded, with liberty to the plaintiffs to amend.

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Concurrence Opinion

Terry, C. J.

I concur in the judgment on the third point mentioned in the opinion of my associate ; upon the other points I express no opinion.