98 Cal. 409 | Cal. | 1893
The plaintiffs brought this action to quiet their title to certain real property in San Joaquin County, and
The defendant denied the plaintiffs’ ownership or right to the possession of the property, and set up title to it in himself under and by virtue of a sheriff’s deed conveying the property to him under date of September 15, 1890.
The court below gave judgment for the plaintiffs, from which, and from an order denying his motion for a new trial, defendant appeals.
The facts of the case, as shown by the findings and evidence, are as follows: —
On January 30, 1886, M. E. Bryant was the owner of the property in dispute, but was insolvent and unable to pay his debts. On that day, under the provisions of the Civil Code relating to “ Assignments for the benefit of creditors,” he signed, acknowledged, and delivered to the plaintiffs for the benefit of his creditors a deed of assignment of all his property not exempt from execution. The grantees accepted the trust and filed the deed for record in the recorder’s office of the county; and on the same day the judge of the superior court of the county fixed the amount of the bond to be given by such assignees, as required by section 3467 of the Civil Code, at the sum of $25,000.
On February 16, 1886, a mistake was discovered in the deed of January 30th, in this, that in the habendum clause thereof the name of R. E. Wilhoit, one of the grantees, had been omitted and the name of H. S. Sargent inserted in its place. The mistake was made by the draughtsman of the deed and was not discovered by any one until the day named. Thereupon the said deed was taken from the recorder’s office and the name of Sargent was erased from the habendum clause and the name of Wilhoit was written in place thereof, and its date was changed to February 16, 1886. Bryant' then again duly acknowledged the deed and delivered it to the grantees, and they again accepted the trust and filed it for record; and as shown by the certificate of the county recorder, it was recorded “in book ‘G,’ volume 6, page 540 of miscellaneous San Joaquin County records.” The judge of the superior court also made a new order on February 16th, requiring the assignees to execute a bond, conditioned
Under the order first made fixing the amount of the bond to be given,, a bond was drawn and signed by the principals and five sureties. It referred to the assignment of January 30th and the order of that date, and proper certificates were attached to it, showing that four of the sureties justified thereon on February 12th and one on February 17th. The bond was approved by the judge of the court who made the orders, on February 18, 1886.
On August 2, 1888, the defendant recovered a judgment against Bryant for the sum of $3,728.29, and on February 12, 1890, an execution was issued on this judgment and placed in the hands of the sheriff of San Joaquin County for service. The sheriff levied the execution on the real property in dispute, and under it sold the property to the defendant in part satisfaction of his judgment on March 8, 1890. Wo redemption from the sale was had, and on September 15, 1890, the sheriff executed to the defendant a deed of the property, which was duly acknowledged and recorded on the same day.
1. Appellant contends that the deed of assignment was never recorded in the proper book, and hence that it was void as against him.
The law authorizes an insolvent debtor to make an assignment for the benefit of his creditors, and the provisions relating to such assignments are' found in sections 3449 to 3473 of the Civil Code. Some of these sections were amended in 1889. The following, as they stood before the amendments, need only be referred to:—
“Sec. 3458. An assignment for the benefit of creditors must be in writing, subscribed by the assignor or by his agent thereto, authorized by writing. It must be acknowledged or proved and certified in the mode prescribed by the chapter on Recording Transfers of Real Property, and recorded as required by sections 3463 and 3464,” etc.
“Sec. 3459. Unless the provisions of the last section are complied with, an assignment for the benefit of creditors is void against every creditor of the assignor not assenting thereto.”
“Sec. 3463. An assignment for the benefit of creditors must*412 be recorded, and the inventory required by section 3461 filed with the county recorder of the county in which the assignor resided at the date of the assignment,” etc.
“See. 3465. An assignment for the benefit of creditors is void against creditors of the assignor and against purchasers and encumbrancers in good faith and for value, unless it is recorded,” etc.
“Sec. 3466. Where an assignment for the benefit of creditors embraces real property, it is subject to the provisions of article IV. of the chapter on Recording Transfers, as well as to those of this title.”
“Sec. 3473. An assignment for the benefit of creditors, which has been executed and recorded so as to transfer the property to the assignee, cannot afterwards be canceled or modified by the parties thereto without the consent of every creditor affected thereby.”
It is argued that section 4235 of the Political Code provides how and in what books the different kinds of papers are to be recorded by county recorders, and that when the deed in question was recorded in a volume of “miscellaneous” records it was not in compliance with the requirements of that section and did not constitute a recordation under the sections of the Civil Code above cited. Conceding, without deciding, this to be so, still the deed was undoubtedly valid as against the assignor and all creditors assenting to it, and it served to vest the assignor’s title to the property in the assignees. (Bryant v. Langford, 80 Cal. 543; Wilhoit v. Cunningham, 87 Cal. 453.) It was at most void only against creditors not assenting thereto and against purchasers and encumbrancers in good faith and for value.
The question then is, Does the appellant come within either of these classes? He obtained his judgment on August 2, 1888, nearly two years and a half after the deed was executed, and the record entirely fails to show by averment or proof that he had any claim whatever against Bryant on February 16, 1886; but the statute evidently makes a deed of assignment void against non-consenting creditors only when they were such at the time it was executed, and not against those who might subsequently become such.
The only remaining question then under this head is, Was appellant a purchaser in good faith and for value? ■ There can be no pretense that he was such purchaser if he had notice, actual or constructive, of the prior deed at the time of his purchase, and the rule is well settled that the burden was cast upon him to show that he had not such notice. (Long v. Dollarhide, 24 Cal. 218.) In Eversdon v. Mayhew, 65 Cal. 167, it is said s “ To entitle a party to protection as such ‘a purchaser he must aver and prove the possession of his grantor, the purchase of the premises, the payment of the purchase-money in good faith and without notice, actual or constructive, prior to and down to the time of its payment; for if he had notice, actual or constructive, at any moment of time before the payment of the money, he is not a bona fide purchaser.” (Citing numerous cases.)
Here there was no averment in the answer of defendant that he did not have notice of the deed of assignment to plaintiffs, nor was any proof offered by him tending to show a want of such notice; and the court found that ever since the date of their deed “ plaintiffs have been and now are in possession of all the real estate and premises in the complaint mentioned, and each and every part thereof.”
It must be presumed, therefore, that appellant had notice of the deed to respondents at the time of his purchase, and hence that he was not a purchaser in good faith.
2. Appellant also contends that the assignment was void,
3. Appellant further contends that the deed of assignment was void as against him, because it conferred upon the grantees the power to sell the property therein described on credit. This contention is rested upon the provisions of section 3457, subdivision 5 of the Civil Code, which reads as follows:—
“An assignment for the benefit of creditors is void against any creditor of the assignor not assenting thereto, in the following cases:—
“ 5. If it confer upon the assignee any power which, if exercised, might prevent or delay the immediate conversion of the assigned property to the purposes of the trust.”
The language objected to as making the whole deed void is found in the habendum clause, and is as follows: —
“ To have and to hold the said real estate .... in trust and confidence, however, to sell and dispose of the said real estate .... using a reasonable discretion as to the times aud modes of selling and disposing of said estate, as it respects making sales for cash or on credit, at public auction or by private contract or sale.”
It is argued that the giving to the assignees a reasonable discretion, as to making sales of the property for cash or on credit, was in violation of the section of the code above quoted, because, if exercised, it might delay the immediate conversion of the property to the purposes of the trust.
4. It is objected that there has been unusual and unwarranted delay on the part of the trustees in the execution of their trust. The delay has certainly been unusual, but it is probably accounted for by the large number of suits which have been instituted to determine the rights of different claimants to the property. The records show that six of the cases besides this have been brought to this court on appeal.
The judgment and order appealed from should be affirmed.
Temple, C., and Vanclief, C., concurred.
For the reasons given in the foregoing opinion, the judgment and order appealed from are affirmed.
McFarland, J., Fitzgerald, J., De Haven, J.