Opinion
Appeal from the District Court of the Third Judicial District, County of Santa Clara.
The action was brought by Edward McLaughlin and C. T. Ryland, copartners, doing business under the firm name of McLaughlin & Ryland, to foreclose a mortgage given by the defendants, Hart and wife, to secure the payment of a promissory note made by Hart to Ryland, and afterwards assigned to the firm. Subsequent to the making of the mortgage the defendant Hart, to secure his own debts, executed other mortgages (in which his wife did not join) to the defendants, H. & W. Pierce, Otto Schetter, and Edward Piguet. Hart and his wife had claimed fifty acres of the land mortgaged as a homestead, and had filed a declaration of homestead as required by law. The first mortgage covered the homestead, but the subsequent ones did not include it. The Pierces, Schetter, and Piguet filed a cross-complaint, asking to have their mortgage foreclosed. By the decree the homestead was exempted from sale, unless it should be found necessary to have recourse to it in case the remainder of the property should be found insufficient to satisfy the first mortgage and the Sheriff's fees. Schetter and Piguet appealed.
COUNSEL:
Sidney V. Smith & Son for Appellants, argued that the appeal was based upon the position that the case presented a condition of affairs to which was applicable the equitable doctrine, that where one creditor has two funds to which he can resort and another creditor has a lien on but one of these funds, the latter can force the former to go to the fund which is not controlled by the latter, and that the equity of Mrs. Hart as to her homestead was subordinate to the equity of the lien holders, and cited White v. Polleys , 22 Wis. 503; Story's Eq., sec. 633.
C. B. Younger, for Respondents, cited Long's Eq. 642; Will. Eq. 338; Gregg v. Bostwick , 33 Cal. 220; Delaney's Estate , 37 Cal. 176; Barber v. Babel , 36 Cal. 11; Spear v. Ward , 20 Cal. 660; Vartil v. Underwood, 18 Barb. 561.
OPINION By the Court:
It is clear that as against the McLaughlin mortgage Mrs. Hart had the right to insist that the outside lands included in that mortgage should be exhausted before resorting to the homestead tract. In this view these outside lands constituted, to the extent of their value, a security provided against the possible sacrifice of her homestead to pay McLaughlin's debt. This security, for obvious reasons, could not be impaired to her injury without her consent. The debts are owing by her husband, and the liens of the junior mortgagees upon the outside lands were created by him alone and without her consent, and to hold that these latter mortgagees may, for their own benefit, compel a sale of the homestead to satisfy the McLaughlin mortgage, would be in effect to create a lien in favor of the junior mortgagees upon the homestead of Mrs. Hart without her consent.
Decree affirmed; remittitur forthwith.