61 P. 64 | Cal. | 1900
This is an appeal of the defendants Bonebrake and Howes from a judgment in favor of plaintiffs for twenty-one thousand four hundred and fifty-eight dollars and ninety-seven cents and costs, and from an order denying defendants' motion for a new trial.
The action was brought to recover on a written guaranty, in words and figures as follows:
"Los Angeles, Cal., June 10, 1889.
"To Henry Pierce, Emily F. Pope, and W.H. Talbot, Trustee, San Francisco, California:
"In consideration of your making a loan to the Semi-Tropic Land and Water Company, a corporation, having its principal place of business at Rialto, San Bernardino, of the amount of $50,000, and taking as security therefor a 2nd mortgage upon its property;
"And in consideration of your refraining from putting the same on record;
"We, the undersigned, guarantee the payment of the said loan, with interest thereon at the times and according to the terms expressed in said note and mortgage, and pledge herewith *467 (1,500) fifteen hundred shares of the capital stock of said company now standing in our names, in the following proportions: Sam'l Merrill, (600) six hundred shares; Geo. H. Bonebrake, (500) five hundred shares; and F.C. Howes, (400) four hundred shares; and we authorize the pledging of our further interest of (2-3) two-thirds of (10,000) ten thousand shares of said stock now in the treasury of said company.
"And, whereas, the said first parties have deposited with second parties the first above mentioned 1,500 shares of the capital stock of the Semi-Tropic Land and Water Company;
"Now, it is understood by and between all of the parties that upon payment of said note and satisfaction of said mortgage that said 1,500 shares of stock shall be redelivered to the said Merrill, Bonebrake, and Howes, in the proportions in which it has been delivered by them.
"Witness our hands and seals the day and the year first above written. "SAM'L MERRILL. "GEO. H. BONEBRAKE, "F.C. HOWES."
The complaint was filed January 31, 1896, and sets out a copy of the above guaranty and then proceeds as follows:
"That in consideration of said guaranty, and in reliance thereon, the plaintiffs did, on the twelfth day of June, 1889, loan to the said Semi-Tropic Land and Water Company the said sum of fifty thousand dollars, and that thereupon, and on said twelfth day of June, the said company made its promissory note for fifty thousand dollars, payable to the plaintiffs on or before June 1, 1891, in United States gold coin, with interest at the rate of eight per cent per annum, payable quarterly, and to secure the payment thereof, according to its tenor, made, executed, and delivered to the plaintiffs a second mortgage upon its property, and which property was situated in the said county of San Bernardino. That thereupon the plaintiffs agreed to refrain, and did thereafter, pursuant to the terms of the said guaranty, always refrain from putting the said mortgage on record, and the said mortgage was never recorded.
"That at the same time with the execution and delivery of the said note and mortgage by the said company as aforesaid, and as a part of the same transaction, the defendants delivered *468 to the plaintiffs the said agreement and guaranty, and also then delivered to them in pledge, pursuant to the terms of said guaranty, and to secure the performance thereof, certificates for fifteen hundred shares of the capital stock of said Semi-Tropic Land and Water Company, whereof the defendant Samuel Merrill contributed six hundred shares, the defendant George H. Bonebrake five hundred shares, and the defendant F.C. Howes four hundred shares. That the said mortgage executed and delivered to the plaintiffs by the said Semi-Tropic Land and Water Company as aforesaid was a second mortgage upon the property described therein, and that the plaintiffs would not have loaned the said sum of fifty thousand dollars to the said company upon the security of the said second mortgage, and would not have refrained from recording the same but for the said guaranty, and that the plaintiffs loaned the said sum of fifty thousand dollars to the said company upon the security of the said second mortgage in reliance solely upon the said guaranty so as aforesaid delivered to them by the defendants."
The complaint then goes on to state that certain amounts were paid at various dates on account of the interest and principal of said promissory note, and that on January 25, 1894, plaintiffs brought an action against the said Semi-Tropic Land and Water Company to enforce the payment of the residue of said note and foreclose said mortgage, and such proceedings were had that on the eighth day of July, 1895, a decree was duly made and entered fixing the amount then due on said note at the sum of thirty-two thousand five hundred and seventy-three dollars and forty-four cents, and directing that the premises mortgaged be sold to satisfy that sum; that after a sale and application of the proceeds thereof there remained a deficiency of some nineteen thousand and twenty-four dollars and eighty-five cents due on said note, and judgment for that sum was entered against said defendant therein; that an execution was issued thereon and returned wholly unsatisfied; that the said Semi-Tropic Land and Water Company has no property, is insolvent, and no part of said amount can be collected from it; and no part of the same has been paid. It is also alleged that defendants had *469 notice of said foreclosure sale, and that the same was once postponed for the period of four weeks at the instance and request of defendants. The prayer of the complaint is for judgment against defendants in the amount of said deficiency, together with interest and costs, and that said fifteen hundred shares of said stock be sold and the proceeds applied on said indebtedness, and that a judgment for any deficiency be entered against defendants.
The appellants demurred to said complaint, and, among other grounds, they pleaded the four year statute of limitations by reference to the provisions of sections
The demurrer was overruled, and in their answer, among other defenses, appellants again pleaded the four year statute of limitations. A trial was had, and plaintiffs had judgment as demanded in their complaint.
It will be seen from the complaint that this action was commenced about four years and seven months after the note guaranteed was due; and hence, if the residue of the note was due from defendants on the date on which they agreed in their guaranty it should be paid, the cause of action set out in the complaint was barred and the demurrer should have been sustained. But respondents contend that to the guaranty was attached the condition precedent that the security consisting of the second mortgage should be exhausted before the guarantors were liable for anything and before any action could be maintained against them, and that consequently the statute of limitations did not begin to run on the guaranty until the mortgage was foreclosed and the deficiency for which they were to be liable had been ascertained. We are of opinion, however, that the guaranty was absolute and unconditional, and that a breach thereof occurred, upon which to base an action, when the note therein mentioned fell due and remained unpaid. (London etc. Bank v. Smith,
"A guaranty is to be deemed unconditional unless its terms import some condition precedent to the liability of the guarantor." (Civ. Code, sec.
It appears from the complaint that action could have been properly brought against the guarantors for the entire fifty thousand dollars on the second day of June, 1891. More than four years after that date this action was begun, and it follows that the cause of action set out in the complaint was then barred by the statute of limitations, and the demurrer should have been sustained on that ground. *471
Respondents, in support of their contention that the guaranty sued on is conditional, and that the guarantors were not liable until the mortgage security was exhausted, cite the following cases: Dutton v. Pyle, 45 Atl. Rep. 429; Cottrell v. New LondonFurniture Co.,
That defendants had notice of the proceedings in the foreclosure case and requested the postponement of the sale therein for four weeks in no way effects their right to contend that the guaranty executed by them matured on June 1, 1891, and that the statute of limitations has run in their favor as to the contract on which the present suit is based. There was nothing in this request of defendants which could have misled plaintiffs or which prevented them from suing on the guaranty before it was barred. Indeed, the request to *472 postpone the sale was not made until after the right of recovery on the guaranty had expired by limitation, for the complaint shows that the judgment in the foreclosure suit was entered on July 8, 1895, more than four years after the note and guaranty fell due, and certainly no postponement of the sale could have been had until after entry of judgment.
It is only in relation to contracts that are uncertain, or of doubtful construction on their face, that the conduct of the parties is to be looked to in aid of construction. Where the terms are plain and certain, as they are in the contract here under consideration, the court will be guided by the language used and construe the intention of the parties to have been in accordance with their agreement. (Hawley v. Brumagim,
If plaintiffs relied upon a written acknowledgment of indebtedness within four years prior to the commencement of the action, or upon any other fact, to take the case out of the statute of limitations, they should have pleaded the same in their complaint. They did not do so, and, therefore, as the complaint stands it is clearly insufficient as against the demurrer based on the statute of limitations. (Sublette v.Tinney,
We advise that the judgment and order appealed from be reversed as to defendants Bonebrake and Howes, and the cause be remanded with directions to the court below to permit plaintiffs to file an amended complaint if they shall be so advised.
Haynes, C., and Cooper, C., concurred. *473
For the reasons given in the foregoing opinion the judgment and order appealed from are reversed as to defendants Bonebrake and Howes, and the cause is remanded with directions to the court below to permit plaintiffs to file an amended complaint.
Temple, J., Henshaw, J., McFarland, J.