119 Cal. 283 | Cal. | 1897
Lead Opinion
A petition for hearing in Bank having been granted, upon further consideration it appears that on January .20, 1892, McDonald conveyed to John Brown Colony, a corporation, and to D. S. Dorn blocks 51 and 60. On that day the title still remained in Brown. The Dorn deed was recorded January 23d, while'the John Brown Colony deed was recorded January 26th. On January 25, 1892, Brown conveyed these same blocks to McDonald, the title thus inuring to Dorn, who first recorded his deed. The presumption of law relating to blocks 51 and 60 was correctly applied in holding in the former opinion that the Dorn deed was‘first delivered. But it does not apply to the John Brown Colony deed as respects the other blocks and lots conveyed to that corporation. As to them, that deed must take date of January 20th, and therefore prior to the Dorn' deed, and the Dorn block could not be released without crediting their full value upon the mortgage debt, as the mortgagee had actual knowledge of the John Brown Colony deed. The value of these blocks was found to be $8,000. The mortgagee did in fact credit the mortgage debt with $5,000 on account of the sale to Dorn, so that there remains to be credited the further sum of $3,000, which should be done as of the date of the release of the Dorn blocks, March 1, 1892. We see no way to apportion this amount so as to exonerate the lots owned by the, appealing defendants alone in the ratio that their lots bear to the whole number of lots sold by the John Brown Colony; -nor do we see any way by which any principle of apportionment could be applied upon any basis of values. As the case stands, it is the fortune of the nonappealing defendants to share the benefits of this credit, as it would have been their misfortune had the dates of the conveyances to John Brown Colony and to Dorn been different.
In the matter of the petition by plaintiff for a modification of the opinion directing that Cecil Ricketts be made a party defendant, the petition will be granted in so far that should it appear that Ricketts had sold his lot prior to the commencement of the action to a person who was made a defendant, the direction heretofore given may be disregarded.
Wherefore, it is ordered and adjudged by this court in Bank that the judgment heretofore rendered in Department be modi
Concurrence Opinion
I concur in the judgment and in the opinion of Commissioner Chipman, as modified, upon all points hut one. I dissent from the order striking out the deficiency judgment against Brown and from the reasoning upon which it is based. I agree to the general proposition that the mortgagee cannot release the mortgage in whole or in part without the consent of the mortgagor, and upon a full release hold the mortgagor to a personal liability, or upon a partial release claim a deficiency judgment greater than would have resulted if no part of the mortgaged property had been released. But when a mortgagor conveys the whole or a part of the mortgaged premises to a third party by a deed containing an express or implied warranty that the premises are free from encumbrances created or suffered by him, and the mortgagee releases to the grantee of the mortgagor, I think the consent of the mortgagor to the release should not only be presumed, but he should not be heard to allege that the release was without his consent.
The moment he makes such a conveyance his covenant is broken and he becomes bound to his grantee to have the mortgage released. If the mortgagee will consent to the release, he cannot refuse to do what he is under a legal and moral obligation' to do. Suppose, in such a ease, the mortgagee should offer to release upon condition that the mortgagor would give his written consent, and the mortgagor should refuse, would not a court of equity compel him to consent? And if he would be compelled to consent where the mortgagee made that the condition of release, why should he be allowed to say he did not consent when the mortgagee has released without conditions? In the eyes of equity what ought to be done is done.
And how, upon this theory of the law, is the mortgagor injured? His grant, bargain, and sale deed implies that he has been paid or secured the full unencumbered value of the land he has sold, and, if there results from the release a larger deficiency judgment against him, he has the money derived from the land itself to pay the difference.
Henshaw, J., concurred.
This is an action to foreclose a certain mortgage executed by John Brown, one of the defendants, to Thomas-E. Hughes, another defendant, on September 28, 1889, to secure certain three promissory notes of even date with the mortgage, executed by Brown to Hughes, which said notes and mortgage were, on May 1, 1891, before maturity, assigned to plaintiff. The property mortgaged consisted of certain lots and blocks of Hughes’ addition to the town of Madera, situated at the time in Fresno county, now Madera county, about one thousand lots in all, many of which afterward fell into the ownership of divers persons who were made defendants as claiming some interest therein. Default was entered as to certain seventeen of the defendants, and certain five of the defendants, viz., Bank of Madera, Annie Lazar, John Brown, A. J. Etter, and N. Bosenthal, appeal. The pleadings cover five hundred folios, and present an exceedingly complicated array of facts out of which the issues arise.
It appears that mortgagor Brown conveyed block 65 March 17, 1891, before the assignment to plaintiff, and mortgagee Hughes released the same to Brown, consideration for sale being $3,000, and for the release $1,000. Brown also conveyed the east half of block 59 September 4, 1891, and the west half of block 59 October 8, 1891. This block was released by plaintiff September 4, 1891, consideration not shown. Brown also' conveyed blocks 51 and 60 to McDonald, trustee, by deed dated January 20, 1892, and McDonald, by deed of same date, conveyed the same lots to one Dorn, consideration mentioned, $10; released by plaintiff February 23, 1892, for consideration of $5,000. All the remaining mortgaged premises were conveyed by Brown to McDonald, trustee, October 8, 1891, by grant deed; consideration stated was $10. McDonald conveyed by grant deed to-John Brown Colony, a corporation, January 20, 1892, the lots described in his deed of October 8, 1891, consideration mentioned, $10. The colony corporation commenced selling lots-January 21,18.92, and disposed of quite a number up to January 19, 1893, when it conveyed the remaining lots and blocks, still a large number, to the Madera Fruit and Land Company, a cor
As conclusions of law, the court found that plaintiff was entitled to the decree of the court for the sale of the premises not released and in the inverse order of the several conveyances thereof, and for deficiency judgment against Brown.
The decree was entered accordingly. The appeal is from the decree and from the order denying motion for new trial, and from the order made May 9, 1896, striking out the affidavit of Robert L. Hargrove, served and filed in support of said motion for new trial.
1. The first question presented is as to the rights of the mortgagor Brown. It is claimed hy him that under section 736 of the Code of Civil Procedure, and the decisions of this court touching that section, the mortgaged premises constitute the primary fund out of which the mortgage debt must be paid, and that the mortgagee cannot arbitrarily release portions of that fund for less than their actual value without the consent of the mortgagor, and, if he does so, he must on foreclosure credit the mortgage with the value of the portions released. (Citing Bartlett v. Cottle, 63 Cal. 366; Porter v. Muller, 65 Cal. 512; Bull v. Coe, 77 Cal. 54; 11 Am. St. Rep. 235; Barbieri v. Ramelli, 84 Cal. 154.)
Respondent treats this point as of little consequence and makes but a mere passing allusion to it. Section 736 of the Code of Civil Procedure provides: “There can be but one action for the recovery of any debt or the enforcement of any right secured by mortgage upon real estate or personal property, which action must be in accordance with the provisions of this chapter. In such action, the court may by its judgment direct a sale of the encumbered property .... and the application of the proceeds of the sale to the payment of the costs of the
The question presented is, not whether the mortgagee may release a portion of the property and look only to the residue, or may foreclose upon a part only and waive his security as to the residue, which he may do; but it is whether he may do this without the consent of the mortgagor and have a judgment docketed for a deficiency.
We cannot perceive upon what principle of equity or by what construction of this section it can be held that the mortgagee may, without the consent of the mortgagor, let go part of his security to a purchaser from the mortgagor, at less than its value it may be, and then look to the mortgagor to make up the deficiency. It would be a gross injustice to the mortgagor to hold him liable for a deficiency which the mortgagee has, without the mortgagor’s authority or consent, created. The deficiency which the code directs may take the form of a personal judgment is a deficiency arising from the sale of all the mortgaged security, and not a part of it. (Jones on Mortgages, sec. 678 a; Worcester Sav. Bank v. Thayer, 136 Mass. 459; Townsend Sav. Bank v. Munson, 47 Conn. 390.)
The danger to the interests and rights of the mortgagor will at once be seen by supposing a not improbable case and one much like the one before us. The mortgagee, for reasons of his own, releases one after another of the mortgaged lots without consideration therefor or for a small consideration, thinking that he has retained enough out of which to realize on sale the amount of the debt. It turns out, through depreciation of values or other cause, that he miscalculated the value of his retained security and there was a deficiency after sale. How there would have been no deficiency if he had not released a portion of his security. It would be clearly inequitable to hold the mortgagor in such case for any deficiency.
In Porter v. Muller, supra, it was held that the proceeds of the sale of the mortgaged premises constitute the primary fund out of which the mortgaged debt must be paid. In Biddell v.
In Brown v. Willis, 67 Cal. 235. it was held that “a mortgagor cannot be compelled to pay any part of his mortgage debt until a decree is entered for a sale of the premises mortgaged.” But if the mortgagee should release a part, he places himself in a position where he cannot sell all the premises. It is well settled that no deficiency can be entered up where a partial foreclosure takes place; it can only be done upon final sale of all the property. So long as any of the mortgaged premises remains unsold there can be no deficiency. (Bull v. Coe, supra. See, also, Hall v. Arnott, 80 Cal. 348.)
In Blumberg v. Birch, 99 Cal. 416, 37 Am. St. Rep. 67, it was held that, after sale of the mortgaged premises and there remaining a deficiency, action would lie to recover the amount, although the deficiency judgment was void; but this was upon the assumption that the mortgage security had been exhausted by the foreclosure sale.
In Barbieri v. Ramelli, supra,, it was held that the mortgagee “was not authorized to waive the security and bring an action on the indebtedness, and the court erred in so holding, as it did in effect, and rendering judgment for plaintiff.”
It seems to us that to allow the release of part of the security and to provide for a deficiency judgment, as was done in the case before us, would be a violation of the underlying principle of the ease last cited, for the mortgagee would thus get a judgment which could be enforced against the mortgagor precisely as if the mortgagee had first waived his security and brought suit on the notes. If he can release part of the security, he can release all, and thus defeat the purpose of the law, which is to confine the mortgagee to the one action and to his security as
Numerous eases are cited in .Tones on Mortgages, sections 722 and 981, to the effect that, as between the mortgagor and the mortgagee, the latter may release any portion of the mortgaged premises without affecting the lien upon the residue. But the cases cited by the learned author do not deal with the rights of the mortgagee to a deficiency judgment where he releases without the consent of the mortgagor, nor does it appear in those cases that the statute Avas as it is here. They deal with the mortgagee’s right to foreclose on the unsold portion still in the hands of the mortgagor. Under our statute, on foreclosure, the land becomes the principal debtor and the mortgagor the surety, and his rights as surety should be preserved.
It may be that, in those jurisdictions where an action is given on the debt as well as on the security, the mortgagee may release regardless of the mortgagor’s rights, or may proceed regardless of the security, but in this state the laAV gives him but one action, and he should be confined to that, at least to the extent of requiring him first to exhaust his security before obtaining other relief. If he desires to release a part of his security, and still hold the mortgagee for any deficiency after foreclosure, he must obtain the mortgagor’s consent, or see to it that in releasing he is paid full value and gives the mortgagor credit therefor.
The form of deed from. Brown to McDonald cannot affect the question. By it Brown’s covenant was that the land was free from encumbrance, but this covenant was not such as is appurtenant to and runs Avith the land, under sections 1113 and 1460 of the Civil Code. It was a personal covenant. (Lawrence v. Montgomery, 37 Cal. 183, and cases there cited.) If the mortgage had been foreclosed upon all the property while Brown held the title, Broivn would, of course, in any event, have been liable for a deficiency, and McDonald Avould have had his action against Brown upon the covenant. The right of the mortgagee to a deficiency judgment, however, would not arise from the
It was stipulated that the lots were of the market value of $1.35 each. The plaintiff testified that it was the understanding with some of the parties, but with whom does not clearly appear, that he, plaintiff, would release for $35 per lot; but later along, when the defendants opened their testimony, some stipulations were entered into by the respective counsel, and, among others, “it was stipulated that John Brown never consented to the release of any pieces of property from the mortgage.” We think this stipulation is controlling as to the fact agreed upon by it.
The plaintiff testified that “there were three hundred and forty-seven lots released at $35 a lot.” It also appeared that he released block 49 (in which there were twenty-eight lots) to the Madera School District without any payment. A simple mathematical calculation will show that these lots were released for several thousand dollars less than their agreed market value. If they had not been released, but had been included in the foreclosure proceedings, by no reasonable probability would there be any deficiency upon foreclosure. The decree, so far as it directs a deficiency to be entered against Brown, is erroneous, and should therefore be modified.
2. The next question presented is whether the court erred in
3. The question most discussed by appellants is as to the equities of subsequent purchasers as they are affected by the releases made by the plaintiff of certain of the mortgaged lots, which had been sold by the mortgagor after plaintiff acquired the mortgage, and were resold by the mortgagor’s grantee and again and again resold by subsequent grantees. A large number of cases are cited by appellants illustrating the rights of purchasers from the mortgagor and their grantees as affected by releases made by the mortgagee. But none of them will be found to hold that the mortgagee may not release without liability to 1dm or impairment of his remaining security, where he does so without actual knowledge of the conveyance. As his mortgage is a lien, and creates an encumbrance alike upon all parts of the land subject to it, no subsequent change in the ownership of the mortgaged premises of which he is ignorant can in any degree limit his original rights conferred by the security. The record of subsequent conveyances is not a constructive notice to the prior mortgagee, so as to prevent him from dealing in any manner with the mortgaged premises; he must have actual notice.
The cases supporting the foregoing are numerous and will be found cited in 2 Pomeroy’s Equity Jurisprudence, secs. 656, 657; 3 Pomeroy’s Equity Jurisprudence, secs. 1224-26; 2 Jones on Mortgages, secs. 1621-24; 1 Jones on Mortgages, secs. 722, 723. As to the rights of the mortgagor, who had conveyed all the mortgaged premises, they are in no wise affected by these releases, except as to the single question of plaintiff’s right to a deficiency judgment, and this has already been disposed of. The only other defendants appealing are Etter, Eosenthal, Lazar, and Bank of Madera, and, as to them, it follows that unless
The court found that plaintiff had no notice or knowledge of defendants’ deeds, and, the evidence upon that point being in conflict, this finding cannot be disturbed. It may be said that, inasmuch as Brown’s deed to McDonald implied a covenant of warranty that no encumbrance rested on the premises, an equity thus attached in favor of McDonald which passed to his grantees and purchasers from or through them.
But the covenant in Brown’s deed to McDonald was personal between him and Brown, and was not a covenant running with the land, and impressed it with no such equity as would pass with the land conveyed by McDonald or his grantee. McDonald, by his grant deed, covenanted against his own acts in creating encumbrances, but not against those of his grantor, the mortgagor. McDonald’s grantee took the land subject to the Brown mortgage without any agreement, express or implied, that McDonald would pay the mortgage debt; nor did McDonald’s deed operate as an assignment to his grantee of the right of action which McDonald had against Brown on the implied covenant. (Lawrence v. Montgomery, supra.)
4. Defendants make the point that there is no provision in our code for partial or other releases; that the only provision delates to a full satisfaction, and that the partial satisfactions or releases operated to discharge the mortgage lien. (Citing Civ. Code, sec. 3938.) We do not think there can be any doubt but that partial releases are authorized by this and subsequent sections. Whether so or not, the universal practice of making partial releases, and their obvious convenience and importance to all persons having any interest in the mortgaged premises, would warrant us in upholding and limiting them to the purpose expressed in making them. It certainly cannot be claimed that if a partial release is unauthorized that when made it would nevertheless operate to discharge the whole mortgage lien.
' The section referred to does not provide in terms for partial satisfactions on the margin of the mortgage record or otherwise,
Defendants claim that there was one particular release made by plaintiff which had the effect to completely satisfy and discharge the mortgage. It is as follows:
“O. J. Woodward, Assignee, to John Brown.
“Dated November 11, 1893.
“Consideration $50.
“That the following land situate in county of Madera, state of California, described as follows, to wit, lots 6 and 7 in block <37 of Hughes’ addition to the town of Madera .... hereby released from the lien of the mortgage, made by John Brown Colony to Thomas E. Hughes, and recorded, etc., .... together with the debt thereby secured, is fully paid, satisfied and discharged, “(Signed) 0. J. WOODWAED,
“Assignee.
“Acknowledged in due form Nov. 11, 1893, and duly recorded.”
That portion of this document reading “together with the debt thereby secured, is fully paid, satisfied, and discharged,” does not appear as part of the record evidence. At folio 793 it appears as defendants’ exhibit 37 without the paragraph above quoted. In an affidavit made by one of defendants’ attorneys, sworn to March 5, 1896, and served on plaintiff’s attorney March 7th and filed March 10, 1896, this release is set out with the paragraph above quoted contained in it, and this alleged new matter, among other things, is stated in support of the motion for a new trial. The notice of this motion was served and filed February 29, 1896, and stated, among other things, that the motion would be heard “upon affidavits hereafter to be served.” At the hearing, May 9, 1896, this affidavit was, on motion of plaintiff’s counsel, stricken from the records, to which defendants’ counsel excepted. I think it evident from the release itself,' in whichever form it is to be considered, that it was not the inten
5. There were other matters set forth in this expurgated affidavit, and defendants claim error in striking it out as to these matters as well. It is quite lengthy, and need not be set forth in this opinion.
This affidavit is before us as part of the bill of exceptions. It was filed on March 10, 1896, and the motion for a new trial came up on May 9th following. The matters contained in it were mainly recitals of what appeared in the record, and were more in the nature of an argument on the motion than the presentation of any new fact, of which the court could take notice. It was not presented by way of suggesting diminution of the record, nor was it in support of the ground of newly discovered evidence, for that was net made a ground in the motion. All the points presented in the affidavit are made in the briefs of counsel for the defendants, and do not require its aid for their full determination which is given them in this opinion. I cannot see that they were prejudiced by striking it out.
6. Defendants assign as error that the court allowed the affidavit of personal service of summons on certain defendants made September 15, 1894, to be amended and filed September 15, 1896, nunc pro tunc. The particular in which the amendment was made was in stating that affiant was, at the time he served the summons, over the age of eighteen years, which by inadvertence he omitted to state. The objection made was, that the court could not, after judgment entered, allow the affidavit to be amended, and that the defaults entered were unauthorized. The order was ex parte and directed that the amended affidavit be made part of the judgment-roll. In Herman v. Santee, 103 Cal. 519, 43 Am. St. Rep. 145, it was held that this might be
7. Defendants assign as error that plaintiff is not the real party in interest and has no right to prosecute the action, and that this issue is raised by the pleadings, and the court did not find upon this issue. The court found that plaintiff was the owner and holder of the notes and mortgage when the action 'was brought, and the evidence shows he took them by written and recorded assignment May 1, 1891. There is some evidence tending to show that he originally took them while acting for the First National Bank of Fresno, of which he was president, but he testified that he finally bought them outright. The written assignment of Thomas E. Hughes (mortgagee), dated February 12, 1893, to W. M. Hughes of all his right to the notes and mortgage is in evidence, and in it he recites that the notes and mortgage are held by O. J. Woodward (plaintiff) and the First National Bank as collateral security for his indebtedness to them. It does not appear that plaintiff had knowledge of this assignment, and, even if he had, his assignor could not bind him by recitals in an assignment to another assignee. The finding is justified by the evidence, and substantially finds on the issue raised by defendants’ answer.
8. Defendants claim that the affidavit for the order of publi
9. It is further objected that the affidavit of publication is void because it does not state that affiant was the foreman, printer, or principal clerk, and does not state that the summons was published once a week, nor the length of time published. (Citing Code Civ. Proc., sec. 415.) The affidavit was sworn to by the publisher and proprietor of the paper. The code, supra, says the proof must be made by the “printer, or his foreman or principal clerk.” It was held under the practice act, where the word “printer” is used, that the word “proprietor” is, in the sense of the statute, synonymous with “printer.” (Quivey v. Porter, 37 Cal. 458.) There is nothing in this point. The affidavit states that the Madera Tribune is a daily and weekly news-, paper, “and that the summons, of which the annexed is a. true and correct printed copy, has been published weekly in the said newspaper, commencing on the seventeenth day of May, A. D. 1894, and ending on the twenty-sixth day of July, A. D. 1894, inclusive, in each and every one of the consecutive weekly issues of said newspaper issued during said period of time, being the regular weekly issues thereof.” Some doubt might arise as to which one of the papers, the daily or weekly, is referred to by the terms “said newspaper,” whether the subject referred to was the daily or the weekly. The affidavit shows-further on that the paper referred to was the “regular weekly issue.” It does not appear on what day of the week the weekly paper is published, but the affidavit says the publication began on the 17th and was published weekly. The time stated would give twenty insertions and embrace seventy days. I think the,
9. Defendants also complain of the application made of the several payments; that they should have been credited first on the three year note, second on the four year note, and third on the five year note, and that if they had been so applied there would have been nothing due on December 19, 1893, when the action was commenced. (Citing Civ. Code, sec. 1479.)
It appears from the evidence that the first note, due in three years, to wit, on September 28, 1892, was paid in full at maturity. The second note fell due September 28, 1893, and this action was brought December 19, 1893. There is no evidence as to plaintiff’s exercise of his option to regard the unpaid notes as due, which by their terms was given, except the bringing of the action. It is in evidence that no payments were made to plaintiff except such as were indorsed on the notes. When the suit was brought the second note was past due, and if all the payments made after the first note wras paid had been indorsed upon the second note, instead of being indorsed partly on it and partly on the last note as was done, there would still have-been an unpaid balance on the second note. The notes bore-the same rate of interest, and defendants were not injured by the-alleged misapplication of the payments. The last note became due on December 19, 1893, by the commencement of the action,, and it was not necessary to the exercise of the option to regard it as due that previous notice should have been given to Browner Hughes, for there was still due some unpaid interest on both notes and some unpaid principal on the second note, and, besides, the beginning of the action operated as an exercise of the option. (Hewitt v. Dean, 91 Cal. 5.)
10. Defendant Etter purchased from the John Brown Colony, February 23, 1892, and his lots have not been released. He sets up a defense special to himself, to wit, that Hughes, the mortgagee, on November 26, 1892, received from him $325 on lots 7, 8, 9, and 10 of block 28, and agreed to release the lots from the mortgage and “hold him harmless and secure in the title to said lots.” The agreement was in writing and is in evidence. This was nine months after he had purchased .and obtained a deed, and one year and seven months after the notes and the mort
11. A question arises as to the effect of the sale of blocks 51 and 60 by McDonald to Dorn on January 20, 1892, on which day McDonald conveyed the residue of the mortgaged premises (except block 65, previously sold and released) to John Brown Colony, a corporation. The Dorn blocks were released February 23, 1892, hv plaintiff. Brown conveyed the property to McDonald October 8, 1891, by grant deed, burdened with the debt as it stood when Brown conveyed. It is conceded by plaintiff’s counsel that if the conveyance to John Brown Colony had been made and delivered before the conveyance to Dorn, and plaintiff
12. It is also claimed that the amended complaint was filed, after order of publication of summons, and was not served by republication of summons, nor was it served on any of the defendants, except R. H. McDonald and W. S. Chapman. Thompson v. Johnson, 60 Cal. 292, and section 472 of the Code of Civil Procedure are cited. It was held in Thompson v. Johnson, supra, that, where a plaintiff amends in matter of substance, he, in effect, opens the default on the original pleading, and must serve his amended pleading upon the parties, including the defaulting defendant.
The amendment here was not such matter of substance as would bring the case within the rule above laid down. The complaint alleged the amount due on the notes, and that plaintiff had exercised his option to regard the notes as due. The
13. Defendants objected to pretty nearly all the evidence introduced by plaintiff, in chief, but I find no alleged error meriting notice. On cross-examination of plaintiff, when on the witness stand, he was asked how much was due on the mortgage and how much he paid for the mortgage; to the latter question plaintiff’s counsel objected, and the court sustained the objection, very properly, I think. It was immaterial what he paid.
He was asked on cross-examination if there was anything owing to the First ¡National Bank above what it paid for the mortgage. The plaintiff objected as immaterial and irrelevant, and the court refused the question. I cannot see wherein defendants were injured by this refusal. Mor, later on, when the court refused defendant’s question as to whether the witness had any interest in the suit. He had testified that there was due him a certain amount on the notes, and, while the question was not an improper one, I cannot see that the answer, whatever it might have been, would change the result. For the purpose of bringing the action his possession of the notes and mortgage, even if he had held them for collection, would have been sufficient to sustain his right of action, and, later on, in answer to defendants’ question, he testified that he “bought the mortgage right out.”
It was also immaterial when he got absolute title, and a question as to the time was immaterial, and so also was it immaterial •whether he advanced other money upon the mortgage than the amount he had testified to. The court might well have allowed more freedom of cross-examination, but it appears that the defendants were not prejudiced in their substantial rights by any restriction imposed by the court. These alleged errors are not urged in defendants’ brief.
14. Defendants complain that W. E. Johns, a defendant, was a purchaser from Madera Fruit and Land Company subsequent to the Bank of Madera title; that he was not served with summons and did not appear, but that the court ordered the prop
15. The decree directs the sale of lot 23, block 28, toward the last of the parcels to be offered. It was embraced in the mortgage, and was conveyed by Brown to McDonald, and by him to the John Brown Colony, and by the colony to the Madera Fruit and Land Company, and by that company to Cecil Bieketts by deed dated January 26, 1893, recorded March 25, 1893. He was not made a defendant and does not appear, and his lot has not been released. There is no finding of the court as to the then owner of this lot. To order its sale was clearly error. He was a necessary party in adjusting the equities of the various-purchasers, as much so as numerous others who were brought, into court. (Porter v. Muller, supra.)
16. Lot 4, block 64, is among the earlier parcels ordered sold. Title is in Madera Fruit and Land Company. The remaining lots in the block come later in order of sale. Title is found by the court to be in Bank of Madera of the whole block, except lot 4. The sheriff’s deed to the bank describes lots 1 to 3, 5 to 6, and 22 to 32. The deed from Brown to McDonald conveyed the whole block; McDonald conveyed the whole block to John Brown Colony, and the John Brown Colony conveyed to the Madera Fruit and Land Company, through which Bank of Madera takes title only to lots 4 to 14 and 25 to 32. This chain of title leaves lots 1 to 3 and lots 15 to 24 in John Brown Colony, and this would necessarily change the order of the sale. I can find in the record no releases and no conveyances of these lots 1 to 3 and 15 to 24, except as above shown. The mortgage describes all of block 64.
The decree orders these lots sold as belonging to Bank of Madera, and makes no provision for the sale of any lots belonging to the John Brown Colony, assuming, I suppose, that there were none. So far as the John Brown Colony is concerned, not hav
I find no mortgaged lots still in John Brown, and no lots still in McDonald, or any immediate grantee of Brown, or in the grantee of any grantee of Brown, which have not been released. If there should be any held by his grantees, the decree properly places them last in order of sale, being first alienated.
17. The court found that lots 1 to 6 and 36 to 33, in block 38, belonged to Bank of Madera, and these lots are ordered sold as its property, with other of its lots. The record shows that the Madera Fruit and Land Company sold lots 36 to 33 in this block to W. E. Davis by deed recorded July 14, 1893. There is no evidence of any transfer by Davis or of any release of the lots. Davis appeared by his attorney and notice of the appeal was served upon said attorney, but Davis does not appeal. There are several similar transfers. The interest of such grantees should be sold before that of the Bank of Madera because its deed relates back to June 3, 1893.
18. It is claimed that the sixteenth finding (fourteenth intended) is not sustained by the evidence, in this, that the evidence shows that Bank of Madera is owner of the west half of block 59 and is not mentioned in the finding, and that Bank of Madera is not the owner of lots 37 and 38, block 53, mentioned in said finding. The court found that all of block 59 was released September 4, 1891. The west half of block 59 came by mesne conveyances into Madera Fruit and Land Company, and was part of the property attached.
John Brown sold to one Boyd lots 1 to 14 of this block September 1, 1891, and the west half of the block October 8, 1891, to McDonald, and McDonald conveyed to Madera Fruit and Land "Company. The mortgage that was introduced in evidence showed an indorsement as follows: ‘^Released by O. J. W., September 4, 1891, block 59.” Plaintiff alleges the release of the whole block September 4, 1891, and this is not denied; on the contrary, defendant Bank of Madera sets out in its answer the date of the release and that it was indorsed on the margin of the
Lots 27 and 28, block 53, appear by the evidence to belong to the Madera Fruit and Land Company, and should be sold before the lots of the Bank of Madera are sold.
19. The twentieth finding is attacked on the ground that the attorney of plaintiff is not shown to be entitled to any sum as attorney fees. The mortgage provided that in case of default, etc., “the mortgagee may foreclose the mortgage, and may include in such foreclosure a reasonable counsel fee to be fixed by the court,” etc. There was an allegation in the complaint that ■the sum of $1,000 is a reasonable sum as attorney’s fees for the prosecution of the action. This was denied. There is no evidence as to employment or value of the services. The court found the sum of $750 to be a reasonable sum to be allowed, and it was carried into the decree. The attorney brought the action and tried it and this appears from the record: no further evidence of employment was required. The duty of fixing the amount of compensation was cast upon the court, and no evidence of value of the services was necessary. (Stats. 1873-74, p. 707; Carriere v. Minturn, 5 Cal. 435; Monroe v. Fohl, 72 Cal. 571; First Nat. Bank v. Holt, 87 Cal. 158; White v. Allatt, 87 Cal. 245.)
The decree should be modified in the following particulars: 1. The lots belonging to W. E. Johns should be sold before the lots belonging tothe Bank of Madera are offered; 2. Lots 1 to 3 and 15 to 24, block 64, should be sold before the lots of Madera Fruit and Land Company; 3. Lots 27 and 28, block 53, should be sold among other of the lots belonging to the Madera Fruit •and Land Company; 4. The Bank of Madera deed must take date of June 3, 1893, .and the order of sales be directed with reference to that date, as in the case of W. E. Davis and other like it; 5. The provision of the decree for deficiency judgment should be stricken out; 6. Before further proceedings are had Cecil Ricketts should be made a party defendant, by due service of process, with the right to answer and litigate any issues properly raised by him; and should there be found other grantees of the mortgaged premises, not defendants, whose deeds were recorded prior to the commencement of the action, and who are necessary
The deed of the lots to Bicketts was dated January 26, 1893, but Bosenthal’s and Lazar’s deeds were made subsequently, so that as to these two defendants their lots should be sold before Bicketts’, and his appearance cannot affect them. As to Etter, however, his deed antedates Bicketts’, and Etter’s lots should not be sold until after Bicketts’ is sold. The defendants who have appealed should be allowed to be heard upon all issues raised by any new defendant in any way injuriously affecting them. But 1 see no reason for reopening the whole case and granting a new trial, for it appears that only one defendant can be affected by the appearance of Bicketts, and he only as to the order in which sale should be made. In view of the fact that at least one other person must be made a party, it becomes impracticable for us to point out the precise order in which all the various parcels must ultimately be sold. The principle adopted by the learned judge who tried the case is the correct one, as the facts now stand. If no new fact should appear, upon a further hearing, affecting the rule as in this opinion set forth, the sales should take place finally by first exhausting the property (if there be any) of the mortgagor and of McDonald and of the John Brown Colony in the order named, and then by sale of the residue in the inverse order of the various alienations as shown by the recordation of the various deeds—placing the last lots of the residue, to which there is a recorded deed, first in order of sale and so on to the first lots sold—treating the deed of the Bank of Madera as of June 3, 1893.
It is recommended that the case be remanded for further proceedings in accordance with this opinion, the costs of this appeal to be allowed to the appealing defendants.
Searls, C., and Haynes, C., concurred.
For the reasons given in the foregoing opinion it is ordered that the case be remanded for further proceedings in accordance ■therewith, the costs of this appeal to be allowed to the appealing defendants.
McFarland, J., Temple, J., Henshaw, J.
