Opinion
Rehearing Denied Feb. 4, 1930
Hearing Granted by Supreme Court March 17, 1930
Appeal from Superior Court, City and County of San Francisco; T.I. Fitzpatrick, Judge.
Action by the Hibernia Savings & Loan Society against J.V. De Ryana and others. Judgment for plaintiff, and defendant Rachel Cafiero appeals. Modified, and as modified affirmed.
COUNSEL
Walter E. Hettman, Chauncey F. Eldridge, and Leo R. Friedman, all of San Francisco, for appellant.
Tobin & Tobin and Geo. A. Clough, all of San Francisco (Robert H. Borland, of San Francisco, of counsel), for respondent.
OPINION
NOURSE, J.
Plaintiff sued to recover the sum of $7,000 loaned to defendant J.V. De Ryana and to establish a trust upon certain real property standing in the name of defendant Cafiero and claimed to be owned by said De Ryana. Plaintiff had judgment as prayed, and the defendant Cafiero alone appeals on typewritten transcripts.
The defendant J.V. De Ryana was a fugitive from justice and was not served with process. The cause was dismissed as to him and proceeded to trial against the appellant and Rosalia De Ryana, wife of J.V. De Ryana. The evidence disclosed that J.V. De Ryana while serving a term in the state penitentiary for the crime of forgery was released on parole and came to San Francisco, where he assumed the name of De Ryana and entered into the real estate business on a large scale. He transacted all his business in the name of his wife and kept his principal bank account in her name. During this time his average bank deposits, carried in the name of his wife, totaled $30,000 annually, and upon his disappearance in 1927 these deposits ceased and the account was practically closed. The appellant was the sister of Rosalia De Ryana. She had about $4,000 which she possessed in her own right. During the times mentioned real properties were purchased by De Ryana in the name of his said sister-in-law, the source of the funds used for that purpose being one of the questions in dispute at the trial.
In 1922 the real property in dispute was purchased by J.V. De Ryana in the name of his wife and J.V. De Ryana and his wife and appellant moved into the premises and continued to reside there during the transactions hereinafter noted. Other flats on the premises were leased in the name of the wife. In 1924 a pretended sale of these premises was made by Mrs. De Ryana to the appellant, the entire transaction being conducted by J.V. De Ryana. No change of possession was made by the parties and no change was made in the outstanding leases of the flats, but the lessees continued to pay rent to Mrs. De Ryana according to the terms of their leases. In November, 1926, by means of forgery of deeds and other documents, J.V. De Ryana fraudulently secured from respondent a loan of $7,000, which sum was deposited in the respondent bank to his credit. A few days after obtaining this credit, J.V. De Ryana withdrew from respondent bank two separate amounts, and at about the same time appellant made two separate deposits to her account in another bank of approximately like amounts to those withdrawn by J.V. De Ryana. The appellant then withdrew from her bank the sum of $3,500 which J.V. De Ryana paid through the title company in satisfaction of a second mortgage on the property in suit.
The case made by respondent was that this property was at all times owned by J.V. De Ryana; that the original purchase in 1922 was made in the name of his wife but for his account; that the transfer to appellant in 1924 did not convey to her any title because Mrs. De Ryana had given to the title company a deed which was intended as a mortgage, and hence when the title company deeded to appellant (the only conveyance to appellant under which she could claim title) it had no title to convey to her. The respondent further claims that the parties disclosed by their actions that no transfer of title or ownership was made or intended.
The trial court found upon conflicting evidence that the real property in suit was in fact the property of J.V. De Ryana and that the legal title which stood in the name of his wife and later in the name of appellant was held merely in trust for him. On this appeal the main attack upon the judgment is based on the claim that this finding is not supported by the evidence. It would serve no purpose to outline the evidence more in detail. The positive evidence of the transactions of J.V. De Ryana, taken with the inferences which were properly drawn from these facts, is sufficient to support the finding. It is true that the testimony of the appellant raised some conflict, but her testimony was so evasive, contradictory, and, in many respects, wholly impossible that the trial court might well have disbelieved her entire testimony. In this respect the case is not unlike Staples v. Hawthorne (Cal.Sup.) 283 P. 67, and Waizman v. Black (Cal.App.) 281 P. 1087, where the direct testimony of an interested party was held to have been overcome by the uncontroverted evidence of facts and circumstances, illustrating, as said in Pugh v. Bell, 21 Cal.App. 530, 534, 132 P. 286, 288, the truth of the old saying that "actions speak louder than words." Our examination of the entire record satisfies us that the evidence is sufficient to support this finding and this disposes of the appeal except for the questions of procedure.
The objection is made that because the respondent dismissed the action as to the principal debtor the trial court lost jurisdiction to proceed as to the others. The argument is that a creditor must first reduce his claim to judgment against the debtor before he can resort to an equitable action to reach property fraudulently transferred by the debtor. The respondent does not quarrel with the rule contended for, but insists that the case here is an exception to the rule. With this we agree. Section 542, subd. 2, Code of Civil Procedure, provides that property standing in the name of one person but owned by the debtor may be attached at the suit of the creditor. Such was the procedure followed here. An attachment lien was placed on the property, and thereafter the appellant and Mrs. De Ryana tendered the issue of ownership, which issue was met by respondent and fairly tried and determined. Manifestly the trial court had jurisdiction to try this issue. Horan v. Varian (Cal.Sup.) 268 P. 637; Becker v. Beldt (Cal.Sup.) 271 P. 1059.
Since the issue of ownership in so far as this appellant is concerned was fairly presented and determined, the question of the effect of the dismissal as to J.V. De Ryana is to be considered on the basis of prejudice to this appellant and not on the basis of any rights which J.V. De Ryana might assert. As to appellant, therefore, it is merely a question of procedure. Then the question is: Did the error in procedure, if any, result in a miscarriage of justice? This is the question which the Constitution requires us to determine before we can reverse the judgment. But we find nothing in appellant’s briefs which suggests any prejudice to her in this respect. Her sole claim is that because decisions have read that the creditor must first reduce his claim to judgment the court in this instance was without jurisdiction to proceed with the trial of the issues tendered. To offset any possible claim of prejudice to appellant the respondent has moved that a certified copy of the final judgment rendered against J.V. De Ryana on the claim in another action be filed herein as new evidence. Such a motion is permitted under section 956a, Code of Civil Procedure, the evidence of the judgment being "additional evidence of or concerning facts occurring *** prior to the decision of the appeal." The motion is granted and the evidence is admitted for the purpose of showing the want of prejudice to appellant from any of the proceedings complained of. With this evidence before us the case presented on this appeal is simply this: The plaintiff, in another action in which J.V. De Ryana was a party, has now reduced its claim against him to final judgment and has subjected the property here involved to the lien of that judgment. Throughout the trial of the cause which is on appeal the claim thus reduced to judgment was treated as an adjudicated claim; that is to say, the claim here asserted and the circumstances under which it arose were the same as those appearing in the other action in which final judgment was had. The appellant had her day in court upon a fair trial of all the issues involved. The failure of plaintiff to reduce its claim to judgment prior to this trial did not affect the trial of the issues in any particular in so far as this appellant is concerned. Hence, if the reduction of the claim to judgment were a prerequisite the failure to do so was an error in procedure only— an error which did not affect the substantial rights of appellant and hence one which did not result in "a miscarriage of justice" which would support a reversal of the judgment under the terms of section 4½ of article 6 of the Constitution.
However, for the purpose of terminating the litigation as we are enjoined to do by the provisions of section 956a, Code of Civil Procedure, the complaint should be amended so as to plead the entry of the final judgment against J.V. De Ryana in the other action and the sale of the property here involved in execution of that judgment, and the findings should be amended so as to find in accord with the amendment. It is therefore ordered that the plaintiff may file in the superior court, prior to the time our judgment herein becomes final, an amendment to its complaint covering these allegations. In the meantime the complaint will be deemed to have been so amended, and upon the record and evidence before us the findings are amended by adding thereto: "That, in the action entitled Hibernia Savings & Loan Society v. J.V. De Ryana et al., in the superior court of the state of California, in and for the city and county of San Francisco, No. 194314, judgment was duly entered in favor of said plaintiff and against J.V. De Ryana, on the 17th day of December 1928, adjudging and decreeing that said defendant was indebted to said plaintiff in the sum of $7,000 for money loaned; that said defendant was the owner of an interest in the real property described in said judgment; that a portion of said sum was used by said defendant for the purpose of paying of incumbrances upon said property which were purchase money incumbrances used by said defendant as a part of the purchase price of said property; that the real property described in said judgment is the same property which is involved in this action and which is fully described in finding No. 12 on file herein; and that said judgment constitutes a lien upon all the right, title, and interest of said J.V. De Ryana in and to said real property. That, in execution of said judgment of December 17, 1928, all the right, title, and interest of said J.V. De Ryana in and to said real property described in said judgment was duly and regularly sold at sheriff’s sale to Hibernia Savings & Loan Society, plaintiff therein, for the sum of $7,000.00."
It is further ordered that the judgment appealed from be modified so that the third paragraph thereof shall read: "It is further ordered, adjudged, and decreed that the said Rachel Cafiero holds the legal title to the real property hereinafter described in trust for the benefit of the said J.V. De Ryana, subject to the lien of said judgment of December 17, 1928, and claim of plaintiff, etc."
The judgment as modified is affirmed, with costs to the respondent.
We concur: KOFORD, P.J.; STURTEVANT, J.