Opinion
Rehearing Denied Nov. 23, 1929
Hearing Granted by Supreme Court Dec. 23, 1929
Appeal from Superior Court, Alameda County; Leon E. Gray, Judge.
Action by Chandler W. Burgess against the California Mutual Building & Loan Association and another. From a judgment for the defendants, plaintiff appeals. Motion to dismiss appeal denied, and judgment affirmed. COUNSEL
Treat & Ogden, of San Francisco, for appellant.
Jones, Boalt, Patterson & Douglas, of San Jose, for respondents.
OPINION
DEASY, Justice pro tem.
On the 9th day of October, 1924, one Daniel McKillop and Josephine McKillop, his wife, executed a deed of trust, in which the respondent California Mutual Building and Loan Association was the beneficiary, to secure a promissory note in the sum of $20,000, and also future advances which said respondent should make to said McKillop, and further advances were made and other notes given. The deed of trust conveyed a tract of land, which, for convenience, will be referred to as the McKillop Heights property, and another tract which will be referred to as the Wayne street property. The descriptions of the various tracts referred to in this opinion are very lengthy, and no useful purpose will be served by setting them out in full. McKillop at that time was engaged in developing the McKillop Heights property as a subdivision, selling lots, and building homes thereon. From time to time, although there was no provision in the deed of trust to that effect, individual lots were released from the lien and reconveyed upon payments being made to said respondent. On December 2, 1925, under circumstances which will be more fully detailed hereafter, said Daniel McKillop obtained a letter from said respondent relative to the release of a portion of the McKillop Heights property, which portion, for convenience, will be referred to as the Burgess property, which letter reads as follows:
"California Mutual Building and Loan Association
"248 South First St., San Jose, Cal. December 2, 1925.
"Mr. Daniel R. McKillop, 354 Russ Bldg., San Francisco, Cal. Dear Mr. McKillop: Confirming our conversation of today, this is to advise that this Association will release the following described property from under the terms of our Deed of Trust covering property described as McKillop Heights, Oakland, for the sum of $6,000.00. [Here follows description of Burgess property.]
"Yours very truly, California Mutual Building & Loan Association, W.B. Rice, Secretary. WBR:LM"
At the time he obtained said letter, McKillop, without the knowledge of the respondents, was negotiating a loan from appellant in the sum of $12,000, to be secured by a second deed of trust on said Burgess property, and represented to appellant that the property could be released from the first deed of trust on the payment of $6,000. The letter, when obtained, was deposited with the California Pacific Title Insurance Company, and, upon the closing of the transaction between appellant and McKillop, was delivered to appellant. The deeds of trust from McKillop to Burgess were executed on the 18th of December, 1925. Some time in 1926 McKillop’s financial condition became very bad. He ceased his development work on the McKillop Heights property, defaulted in his payments to respondents, and finally was adjudged a bankrupt. In October, 1926, McKillop being in default in his payments, the respondent La Motte, who had been substituted as trustee in the original deed of trust of October, 1924, gave notice of default and of an intention to sell so much of the McKillop Heights property as remained subject to the lien of the deed of trust, in accordance with law, to satisfy the claim of the respondent California Mutual Building & Loan Association. In January, 1927, appellant called at the office of the loan association, and tendered to it the sum of $6,000, and demanded of it a reconveyance of said Burgess property. The tender was not accepted, and the reconveyance was refused, and thereafter appellant commenced this action to enjoin the sale of said Burgess property and to obtain a reconveyance of the same. The case was tried before the court, which gave judgment for the defendants, and plaintiff appealed.
No stay bond having been filed, the trustee proceeded, pending the appeal, to sell said Burgess property under the terms of the deed of trust, and at the sale appellant became the purchaser, paying therefor the sum of $10,000. Subsequently respondents made a motion to dismiss the appeal upon the ground that appellant, having received from the trustee a conveyance of the property, has now all that he asked in his complaint, and that the question is now moot. The motion to dismiss and the appeal on its merits were argued and submitted together.
So far as the motion to dismiss the appeal is concerned, it is hardly an accurate statement of the facts to say, as respondents do, that appellant has obtained all that he was seeking by his complaint. It is true that he has now the title to the property, free and clear of the lien of the respondents’ deed of trust, but, instead of a reconveyance for $6,000, he obtained a conveyance from the trustee for $10,000. It cannot well be said that he voluntarily became a purchaser, because the proceedings for the trustee’s sale were inaugurated by the respondents, and appellant was by such act of the respondents placed in a position where he had to do something to protect his rights. He might have chosen some other means, perhaps, but he has not waived his right to prosecute his appeal by doing what he did. The situation is analogous to a case where, pending an appeal, the appellant, in order to prevent an execution sale, pays the amount of the judgment. In such case, unless there is some agreement of compromise, or an understanding that the appeal will not be prosecuted, the mere payment does not operate to deprive the appellant of his rights. Warner Bros. Co. v. Freud, 131 Cal. 639, 63 P. 1017, 82 Am.St.Rep. 400; Knight v. Marks, 183 Cal. 354, 191 P. 531.
In the case of Sunset Lumber Co. v. Bachelder, 167 Cal. 512, 140 P. 35, 36, Ann.Cas.1916B, 664, a mechanic’s lien had been held to be prior to that of a mortgagee. Pending an appeal by the mortgagee, the mechanic’s lien was foreclosed, and the mortgagee bid in the property and paid the amount of the judgment to the lien claimant. On the appeal it was contended that by so acting he had waived his right to appeal, but the Supreme Court held otherwise, saying:
"In order to protect his own interests, in the absence of a stay of proceedings, Rankin (the mortgagee) was compelled to appear at the foreclosure sale and make such bid as might be necessary to make the property bring its reasonable value. The case is governed by the same principles as where a defendant against whom a judgment is rendered has appealed after execution has been taken out and enforced against him. In such cases the rule is said to be that ‘a forced payment by execution sale against a nonconsenting judgment debtor cannot be held to abridge any of his rights upon or under appeal.’ Vermont Marble Co. v. Black, 123 Cal. 23, 55 P. 599; Kenney v. Parks, 120 Cal. 24, 52 P. 40; Warner Bros. Co. v. Freud, 131 Cal. 639, 63 P. 1017, 82 Am.St.Rep. 400. The same principle applies here. The defendant Rankin was compelled to submit to the sale and protect his interest by bidding thereat, and he is not thereby estopped from availing himself of an appeal from the part of the judgment which is to his prejudice, and upon the reversal of which the remaining parts of the judgment will stand unaffected."
Counsel for respondents, in support of the motion to dismiss the appeal, rely to a large extent upon the case of Preluzsky v. Pacific Co-operative C. Co., 195 Cal. 290, 232 P. 970, 971. That case lays down the rule quoted by respondents as follows: "It is the general rule that a voluntary satisfaction of a judgment by a party estops him to prosecute an appeal therefrom." But the court continues in the same sentence: "But where such satisfaction is involuntary and enforced by process, the mere circumstance that the judgment has been so satisfied does not of itself alone deprive a party aggrieved of his right to appeal therefrom."
Respondents’ contention that the act of appellant in the case at bar was a voluntary one is, we think, completely answered by the ruling in Sunset Lumber Co. v. Bachelder, supra.
Respondents also advance the theory that, as appellant bid $10,000 for the property instead of $6,000, the amount he sought to pay for the reconveyance, and as respondents permitted appellant to purchase for $10,000 instead of requiring him to pay the sum of $19,984.33, the balance found to be due to them, the situation must be regarded as in the nature of a compromise. It is a sufficient answer to this contention to say that, outside of the mere facts so mentioned, there is no showing in the record on the motion to dismiss of any compromise in the matter, and we are not at liberty to make a contract of compromise or satisfaction for the parties when they themselves have not done so.
The motion to dismiss the appeal should be denied.
Coming to the appeal on its merits, there are many assignments of error which do not require separate attention, as they may be grouped under a few general topics and so considered.
Appellant contends that all of the findings relative to the Wayne street property are not supported by competent evidence. As to many of the findings thus attacked this contention is undoubtedly correct. But as to the finding that the Wayne street property was included in the deed of trust merely as additional security for the performance of certain street work on the McKillop Heights property, and was to be reconveyed when that work was completed, and that the street work was actually completed prior to October 9, 1925, the evidence is more than sufficient to support it. This being so, all questions as to whether the security of the Wayne street property was worthless to respondents, or whether there were prior deeds of trust or other liens upon it, or whether it was sold on foreclosure of a prior lien, become immaterial to a decision of the case, and the findings as to those matters may be disregarded. It is well settled that failure to find upon an immaterial issue is not a ground for reversal, and similarly a finding on an immaterial issue becomes mere surplusage, and will not cause a reversal, if the material findings are supported by the evidence. It was established as a fact in the case by competent evidence that, upon the completion of the street work to the satisfaction of respondents, McKillop became entitled to a reconveyance of the Wayne street property, and therefore its reconveyance did not operate to deprive appellant of any right, or give rise to any cause of action in his favor.
For the same reason many of the assignments of error as to the admission of evidence are immaterial and require no further discussion.
Aside from the findings just referred to, an examination of the record discloses that the evidence is ample to support all of the other findings of the trial court.
Where findings are attacked for insufficiency of evidence to support them, the power of the appellate court begins and ends with the inquiry whether there is substantial evidence, contradicted or uncontradicted, which will in and of itself support the findings of the trial court, and if on any material point the testimony is in conflict, the appellate court must assume that the trial court resolved the conflict in favor of the prevailing party. Mercantile Investment Co. v. How (Cal.App.) 278 P. 243; Treadwell v. Nickell, 194 Cal. 243, 228 P. 25; Gjurich v. Fieg, 164 Cal. 429, 129 P. 464, Ann.Cas.1916B, 111.
Many of the assignments of error as to the evidence are merely stated in appellant’s brief, and no attempt is made to point out the reasons for the claim of error. Error will not be presumed, and must be shown; therefore all such assignments must be disregarded. It is the duty of counsel to point out the error and to cite the authorities in support of their position, and, where they fail to do it, we will not search the record to find the error. People v. Chutnacut, 141 Cal. 682, 75 P. 340; People v. Schlosser (Cal.App.) 278 P. 898.
Many of the specified errors in the admission of evidence are claimed by appellant to be violations of the parol evidence rule, as tending to vary the terms of the letter by which respondents agreed to reconvey the Burgess property to McKillop. Respondents urge in regard to this letter that it was based upon no consideration. Appellant claims that, being an instrument in writing, the letter imports a consideration. None being recited in the instrument, it was competent for respondents to show the true state of facts.
With certain exceptions, not material here, it is the rule that parol evidence may be given to show just what the consideration was, even though the transaction be evidenced by a writing. This being so, it was certainly proper in the case at bar for the respondents, in endeavoring to prove lack of consideration, to show the circumstances surrounding the giving of the letter to McKillop. They showed by ample evidence that before McKillop was entitled to demand a reconveyance of the Burgess property his loan must be in good standing, the building operations and the development of the tract must be proceeding, and the security of respondents must, generally speaking, be unaffected by any act of the borrower. All of this was reasonable and not at all improbable. It clearly appeared from the evidence that respondent loan association, as the promisor in the letter, received no benefit by giving it to McKillop, and that he suffered no detriment by reason of its receipt. After he defaulted, McKillop could not have demanded the reconveyance, and appellant’s position is no better than that of the original borrower. The trial court found on ample evidence that this was the true state of the matter, and correctly concluded that there was no consideration for the letter.
Appellant urges, however, that respondents are estopped from claiming that there was no consideration for the letter, because by their negligence in giving it to McKillop they made it possible for him to deceive appellant. There is no merit in this contention. The record shows clearly that the respondents were entirely ignorant of the fact that McKillop was negotiating, or intended to negotiate, a second loan on the property, and that the only purpose they had in mind in dealing with him was to aid in the improvement of the property so that their security would be enhanced. In view of the pleadings and the evidence, there is no justification in this case for the application of the doctrine of estoppel. Under the rule of caveat emptor, appellant, knowing that he was lending money on a second mortgage, was bound to find out all of the conditions surrounding the matter of the reconveyance. The record shows that he did not even see the letter in question until some time after he had paid over his money to the title insurance company. Appellant, under these circumstances, is not shown to have relied upon any statements contained in the letter, but upon the promise of McKillop to obtain the letter. He was not deceived or misled by anything contained in the letter, and therefore cannot claim any estoppel by reason of anything that respondents did in the matter.
In its final analysis this case is in the nature of an action in specific performance. There being no adequate consideration moving to respondents, they cannot be compelled to reconvey the Burgess property. Section 3391, subd. 1, Civ.Code; Stein v. Archibald, 151 Cal. 220, at page 226, 90 P. 536.
In this connection a very significant matter that should be noticed is the following: Appellant has come into a court of equity asking that respondents be compelled to reconvey certain property to him for the sum of $6,000. In his affidavit filed in opposition to the motion to dismiss the appeal, appellant swears as follows:
"That there was no other person than this plaintiff present willing to bid on said real property, save and excepting the said defendant California Mutual Building and Loan Association, which said California Mutual Building and Loan Association did offer to purchase said real property for the inadequate price of $6,000.00 and no more, and that this plaintiff was threatened by the said intended sale with the loss of the property to which he did then and does now claim an interest in, for a price entirely inadequate to its real value."
In view of the foregoing statement, it can hardly be said that he is doing equity in offering what he so solemnly declares to be an inadequate sum to obtain the reconveyance, and therefore he cannot be heard to ask equity.
There are no other matters requiring notice in connection with the appeal, and for the reasons stated the judgment should be affirmed.
It is therefore ordered that the motion to dismiss the appeal be denied, and that the judgment be affirmed.
We concur: KNIGHT, Acting P.J.; CASHIN, J.