28 P.2d 367 | Cal. Ct. App. | 1934
THE COURT.
The above action was brought to quiet plaintiff's title to a parcel of land in Los Angeles County. Plaintiffs acquired title from the estate of J.J. Morgan, deceased, by deed dated September 20, 1929, and recorded on September 27, 1929. Morgan acquired the property from F.N. J. Willey on November 8, 1902, by a deed which recited that the conveyance was made subject to "the mortgage on this and other property for the amount of $14,000". The mortgage referred to was executed by W.E. Hoel and others to the Willeys, and it was recorded on March 10, 1920. The same was assigned to appellant E.H. Willey on June 6, 1922, and the assignment was duly recorded. The mortgage secured a note payable on or before three years after March 1, 1920. So far as appears by the public records the note and mortgage were barred by the statute of *199 limitations at the time of the plaintiffs' purchase. On February 2, 1925, Morgan executed an agreement in writing to pay appellant Willey on March 2, 1926, the balance which remained unpaid on the note, namely, $500 with interest, and said appellant therein agreed to extend the time for payment accordingly. This agreement was not acknowledged nor recorded, and no part of the said amount or the interest thereon has been paid. Willey alleged that plaintiffs had notice at the time of their purchase of all of the above facts, and acquired title subject to the lien of the mortgage. The court, however, found against these allegations, and entered judgment quieting plaintiffs' title as against Bank of America of California, a corporation, and Mary L. Willey, who were joined as defendants, and said E.H. Willey. The latter, who has appealed, contends that these findings are unsupported, and that the lien of the mortgage continued by virtue of said agreement.
[1] As urged by plaintiffs, one not personally liable for the debt secured, who acquires mortgaged land for a consideration after the lapse of time within which an action to foreclose the mortgage could be brought and at a time when the records show the lien to be extinguished may quiet his title as against the mortgagee without paying the debt (Faxon v. All Persons,
[4] The evidence shows without conflict that both plaintiffs and a title insurance company, which acted as escrow-holder in the transaction through which plaintiffs acquired title, and which company issued to them its policy insuring the title, knew before the title passed of the existence of the mortgage in question. As held in Lent v. Morrill, supra, and the other cases cited, although plaintiffs may have been ignorant of the fact that the note and mortgage had been extended, they knew that the mortgage had not been discharged of record, and were bound to know as a matter of law that a renewal of the note was a possible event. Under such circumstances it was their duty to inquire as to whether it had been renewed or extended in fact. Here an officer of the title company testified that while the deed was in escrow appellant advised the company that he held a mortgage on the property and asked for information regarding the proposed transfer, but information was refused. It is evident from this that appellant was diligently seeking to apprise those interested of his claim. Whether plaintiffs were chargeable with constructive notice by the information conveyed by appellant to the escrow-holder it is unnecessary to decide (see Early v.Owens,
Under the admitted facts and the law as declared in the above cases the finding that plaintiffs did not prior to their purchase have notice that the mortgage had been extended is not sustained. Moreover, it has been held not to be sufficient in cases of this character to find merely that a party was without actual notice or knowledge (Prouty v. Devin,