63 P. 368 | Cal. | 1900
Action to quiet title. Plaintiff is one of ten children of William H. Winston, who died testate in May, 1886; in June, 1886, his surviving widow, Mary E. Winston, was appointed executrix; plaintiff is a devisee under the will of deceased and claims as such; she brings this action to quiet her title to an undivided one-eleventh interest in a certain tract of land in Los Angeles county, as property of the Winston estate. The judgment was that plaintiff is the owner in fee of an undivided one-eleventh interest in the property in question; that defendant has no right or interest in said one-eleventh interest; and that plaintiff's interest "is subject to all lawful claims that may be made thereon in the course of the further administration of the estate of said William H. Winston which is now uncompleted." The appeal is from this judgment and from the order denying defendant's motion for a new trial.
The testator made certain specific bequests to plaintiff and other heirs at law, and provided that, after the legacies mentioned in the will were paid, the residue of the property should be equally divided between the testator's wife and children, share and share alike. The court found the following facts: That plaintiff is the owner of an undivided one-eleventh interest in the land described in the complaint, and that defendant's claim thereto is without right; that in November, 1891, the executrix filed her petition for an order authorizing her to mortgage the real estate in dispute. The petition showed that of the money coming into her hands all had been disbursed by the executrix in payment of debts of the deceased, expenses of administration, payment of the legacies, and family allowance, and other costs and charges against said estate; that certain exempt personal property was set aside to the widow, and there remained belonging to the estate two old mules, two young mules and one colt, valued at $500. The petition showed accrued liabilities amounting to $21,052.38, and debts, expenses and charges to accrue, $28,247.70; total, $49,300.08. The petition was granted to the extent of authorizing the mortgage for $45,000, and such mortgage was executed to defendant bank on December 16, 1891, and on December 1, 1896, there was *117 due and unpaid thereon $63,081.64. Foreclosure followed, and in due course, in June, 1898, a sheriff's deed granting the premises to defendant as purchaser, and the land has been in defendant's possession ever since claiming under this deed. No question arises as to the form of the proceedings to mortgage or the sale on foreclosure. There has been no final account or settlement of the estate or distribution, and the court found that there is no property of the estate with which to pay to plaintiff her legacy, and the executrix is insolvent and was serving without bonds. At the time this mortgage was executed the executrix owed the defendant in her individual capacity $33,347.03, which was made up of $24,000 and accrued interest, being money borrowed by her from defendant some years before the probate mortgage was executed, and she used this money to purchase the entire interest of six adult children in the estate; and the personal indebtedness of the executrix also included the further sum of $1,175 borrowed from defendant by her on personal account, for which she had given her note. The mortgage was executed by the executrix as such and by three of the adult heirs who had not sold their interest to Mrs. Winston, and by her individually, thus including ten-elevenths of the interests in the property. The court found that of the $45,000 borrowed by the mortgage the bank paid her only $7,329.97 and applied $4,323 in satisfaction of its own claim against the estate, which was justly due the bank, and credited the balance, namely, $33,347.03, in payment of the personal debt above referred to, due it from the executrix; that the executrix paid out of this $7,329.97 the legacies of two brothers of plaintiff, amounting to $6,900, including three years' interest. The evidence was that the $45,000 was passed to the credit of the executrix on the books of the bank on the day the mortgage was executed and delivered, and on the same day she gave the bank her checks to pay her individual indebtedness of $33,347.03, above stated, and the allowed claim of the defendant, $4,323, leaving a balance to her credit of $7,329.97.
1. The written opinion of the learned trial judge printed in the briefs discloses the theory on which his decision rests; and it was that the mortgage money was impressed with a trust, and its application to pay the personal debt of the *118 executrix was a breach of trust on her part; that the defendant had notice of the fact that the money it received was held by the executrix in trust and could not be applied to the payment of her individual debt, and that, therefore, the mortgage was void as to plaintiff.
I think the facts warranted the trial court in concluding that the defendant had knowledge that the money it received on the checks of the executrix, drawn upon this mortgage loan, belonged to the estate, and that in receiving it to pay the individual debt of the executrix the defendant became a party to the violation of the trust and acquired no right to the money it received from her, so far as plaintiff is concerned, and plaintiff's right to the money was unaffected by the mortgage or by the payment to defendant. But it does not follow that the deed under which defendant claims title is void, or that the proceedings by which it acquired title can be set aside or annulled upon the pleadings and evidence now before us.
The petition showed legitimate charges against the estate amounting to more than $45,000. The money borrowed passed to the credit of the executrix and was under her control as executrix; the transaction was fair and open, so far as the evidence shows, and the mortgage was a valid lien unless void for the reason next to be noticed. It was in the application of the money thus borrowed, and not in the execution of the mortgage or the sale under foreclosure, that an implied or constructive trust arose under which defendant must account. The title to the land is now in defendant.
2. Respondent contends that the mortgage was void as to plaintiff because it deprived her of vested rights. The testator died in 1886, and the act authorizing the mortgage was passed March 15, 1887 (Stats. 1887, p. 115), and was an act adding a new article to the Code of Civil Procedure relating to mortgages and leases of real property of decedents. The sections relating to mortgages are 1577 and 1578. The proceedings to mortgage the property being regular and conformable to the statute, its provisions need not be set forth. Respondent relies upon Brenhamv. Story,
Our opinion is that the court erred in deciding that plaintiff owns an undivided interest in the land. *121
Haynes, C., and Gray, C., concurred.
For the reasons given in the foregoing opinion the judgment and order appealed from are reversed.
Henshaw, J., McFarland, J., Temple, J.
Hearing in Bank denied.