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District Court of Appeal, Fourth District, California.

EASTON v. ASH et al.

Civ. 2492

Decided: January 07, 1941

Ray Howard and Chas. M. Easton, in pro. per., both of Los Angeles, for appellant. Meserve, Mumper, Hughes & Robertson and Leo E. Anderson, all of Los Angeles, and James A. Hall, of Hemet, for respondents.

Plaintiff brought this action to foreclose a mortgage, and for damages for cutting trees on the mortgaged property. Judgments of nonsuit were rendered in favor of George F. Scott, Warren L. Holbrook and Margaret Cross, and judgment on the merits went in favor of Kenneth K. Ash and Ada Gertrude Ash. Plaintiff has attempted to appeal from these judgments.

The complaint was filed on May 22, 1937. In a first cause of action plaintiff sought to foreclose a mortgage dated June 23, 1924, given by the defendants Ash to Henry Hileman, since deceased, to secure a note of even date for one thousand dollars, due six months thereafter. A copy of the mortgage containing a copy of the note is attached to the complaint. This is the only mortgage sought to be foreclosed.

It is alleged that at some time before the death of Henry Hileman on June 22, 1930, Margaret Cross executed a writing whereby she agreed to pay “all interest due and that may become due in the future” on the note. It is also alleged that interest on the note was paid in full up to June 29, 1930, but that none was paid thereafter.

It is further alleged that on December 10, 1930, defendants Ash executed an instrument in writing with Rena Hileman, legatee of Henry Hileman and subsequent distributee of this portion of his estate, to extend and renew the note and mortgage for a period of forty months from and after February 1, 1931. A copy of a written agreement which plaintiff claims had that effect is attached to the complaint as is a promissory note dated December 10, 1930, for $1,000, payable to Rena Hileman or order in instalments of $25 per month commencing on February 1, 1931. This note bears the heading “Instalment Note Secured by Mortgage”.

A second cause of action alleges damages for waste caused by certain defendants cutting eucalyptus trees growing on the mortgaged premises shortly after May 25, 1935.

Defendants interposed numerous defenses to the action among which are various pleas of the statute of limitations, as well as lack of consideration for the extension agreement.

Plaintiff testified, and defendants denied, that the extension agreement was actually executed in August, 1934, and not on December 10, 1930, the date it bears. At all times material, Margaret Cross was acting for the defendants Ash under a general power of attorney. She testified that the extension agreement, the instalment note and the unrecorded mortgage securing it were all signed at the same time. It is undisputed that on or about December 10 or 11, 1930, defendants Ash, acting through Miss Cross, signed the instalment note and unrecorded mortgage; that the acknowledgment on the mortgage is dated December 11, 1930; that this mortgage, together with a release of the mortgage of June 28, 1924, were delivered to a title company in Riverside with instructions to record the documents when title could be certified showing the mortgage dated December 10, 1930, a first lien on the property; that this mortgage and the release were never recorded because of the condition of the title of the property.

The mortgage and note of June 28, 1924, and the extension agreement and promissory note dated December 10, 1930, were distributed to Rena Hileman by a decree of distribution of the superior court of Los Angeles county dated April 7, 1936.

Under date of April 9, 1936, Rena Hileman assigned to plaintiff the promissory note and mortgage dated June 10, 1924, the extension agreement dated December 10, 1930, and the instalment note bearing the same date.

The trial court found that the extension agreement, the instalment note and the unrecorded mortgage were all signed on December 10, 1930, the date they bear, and that the extension “agreement was intended and it was the agreement of the parties thereto that it did not and would not change the provisions of said note and mortgage of 1930”; that “plaintiff, in open court during the trial of this action, expressly waived any right to recover under or by virtue of said promissory note or the mortgage on said real property securing the same” referring to the mortgage and note of 1930. It was also found that the extension agreement was not supported by any consideration and that plaintiff's causes of action were barred by the statute of limitations.

From this statement of facts it is at once apparent that the first important question for our consideration is the meaning and effect of the extension agreement. If it was part and parcel of the attempted execution of the new note and mortgage of 1930 and was not a valid extension of the note and mortgage of 1924 which is sought to be here foreclosed, then the statute of limitations barred plaintiff's cause of action to foreclose the mortgage of 1924 long before this action was flied in 1937.

Much of plaintiff's argument is based on the assumption that the extension agreement was signed in 1934 and not on the date it bears. It is true that plaintiff testified in considerable detail that the document was signed in 1934. Miss Cross testified that it was signed at the same time as the instalment note and the unrecorded mortgage, that is, about December 10, 1930, the dates the three instruments bear. It is true that this testimony of Miss Cross was considerably shaken on cross-examination. This only affected the weight to be given to her evidence and her credibility. The trial judge, to whom is given the duty of passing on the weight of the evidence and the credibility of the witnesses, accepted her evidence as true and found in accordance with it. As there is a conflict in the evidence on this question we cannot disturb that finding here.

In approaching the question of the construction to be placed on the extension agreement it should be borne in mind that where there are uncertainties in an instrument so that it will support two reasonable interpretations, it is the province of the trial judge to construe it; that if the construction put upon it by the trial judge is not unreasonable, even though there is another equally reasonable, the decision of the trial judge on that question cannot be disturbed on appeal. Adams v. Petroleum Midway Co., Ltd., 205 Cal. 221, 270 P. 668.

To us the agreement seems uncertain. There are several “Whereas” clauses in the opening paragraph of the contract which refer to the mortgage of 1924 and from which an intention to extend that instrument can be inferred. However, in the body of the contract it is recited that Rena Hileman extends the mortgage and note for a period of forty months from and after February 1, 1930, which is the exact term of the instalment note which was signed at the same time and place and which was to be secured by the unrecorded mortgage, also signed at the same time.

It is accepted as a general rule that when two or more writings are executed by the same parties at the same time and refer to the same subject they form part of one agreement and should be construed together. Symonds v. Sherman, 219 Cal. 249, 26 P.2d 293; People v. Ganahl Lumber Co., 10 Cal.2d 501, 75 P.2d 1067; Hawes v. Lux, 111 Cal.App. 21, 294 P. 1080; C.I.T. Corp. v. Hawley, 34 Cal.App.2d 66, 93 P.2d 216.

When we apply this rule to the facts before us as found by the trial court, we must construe the three instruments and the unrecorded release of the 1924 mortgage together as writings forming part of the same transaction. With the exception of the release they were signed at the same time, by the same parties, and the four of them dealt with the same transaction, namely, the refinancing of the debt. This conclusion is strongly supported by the testimony of plaintiff. While he denied that the extension agreement was executed at the same time as the other three documents, he testified that it was the intention of the parties in 1930 to extend the time for payment of the debt by satisfying the 1924 mortgage and releasing the property from its lien by executing the new note and mortgage and the satisfaction of mortgage, and recording the latter two documents. When we couple with this evidence the testimony of Miss Cross that the extension agreement was signed at the same time (accepted as true by the trial court) we must conclude that the four instruments pertained to the same transaction and were signed to carry out the expressed intent of the parties to extend the time for the payment of the debt by the new note and unrecorded mortgage and not by the extension of the time of payment of the 1924 note and mortgage and the preservation of the lien of that mortgage. This evidently was the theory of the trial judge in deciding the case and as there is evidence to support that theory we must accept it on appeal.

Plaintiff complains of the finding to the effect that he waived his rights to any recovery under the note and unrecorded mortgage dated December 10, 1930. He argues that this finding is contrary to the evidence. An examination of the record demonstrates the lack of any factual foundation for this argument. It is also true that the action was brought to foreclose the mortgage of 1924 and not the one dated December 10, 1930.

Mr. Easton, an attorney at law, represented himself during the trial. Among other statements made by him we find the following: “The Court: Well, if the plaintiff is relying solely upon the mortgage dated December 10th, 1930—

“Mr. Easton: We are not relying on that your Honor. *

“The Court: Now, then if you are relying upon the new mortgage which you must rely on, an unrecorded mortgage, then does not the release of the old mortgage which is likewise not recorded, an important element in the transaction?

“Mr. Easton: No, for this reason, your Honor, the execution of the new mortgage, well, we will call it a new mortgage, the one in possession of Mr. Holt, is nothing more than evidence of the fact of the execution of the mortgage and the attempted or contemplated, we will say, substitution of that mortgage at the time in lieu of the one that existed in 1924. * We are not relying on that new mortgage as a part of the foreclosure, excepting a chain and circumstances showing execution and subsequent execution of renewal and extension agreement whereby there was a change to the renewal of that which was of record, whatever release there was in there, does not amount to anything, or it has no legal effect or significance, except to show what was contemplated to be done but which never was done—I think I can clarify that. *

“The Court: Well, let's see, you have introduced that note for $1000.00 dated December 10th, 1930.

“Mr. Easton: As evidence only, your Honor—

“The Court: Now then, is it fair, is it fair to let the plaintiff take the benefit of the new unrecorded mortgage?

“Mr. Easton: I am not taking any benefit—

“The Court: And still, or hold her accountable for the—executing the release.

“Mr. Easton: We are not relying on the execution of the mortgage in question, in possession of the title company, as having any binding force and effect as will be shown by the papers placed in evidence, we are not seeking to foreclose on that.”

These statements clearly show the waiver of any right to recover anything under the note or unrecorded mortgage of December 10, 1930. The trial court acted on that waiver and plaintiff cannot withdraw or abandon it here for the first time. As these instruments formed only part of those evidencing the agreement of the parties, and as the extension agreement was only a document evidencing another part of the same indivisible agreement, the waiver of any rights under the note and mortgage must be held to be a waiver of rights under the entire contract, including the extension agreement. Mitchell v. Samuels, 39 Cal.App. 134, 178 P. 336.

It follows that plaintiff's right of recovery from the defendants Ash was barred by the statute of limitations and the judgment in their favor must be affirmed.

The sole liability of Miss Cross arose under her guarantee of the payment of interest on the 1924 note. This guaranty was executed prior to the death of Mr. Hileman on June 22, 1930. Her liability was that of a guarantor which is equal to but does not exceed the liability of the principals. The plea of the statute of limitations was available to her and the bar of the statute having arisen in favor of her principals it was properly sustained as to her. Anderson v. Shaffer, 98 Cal.App. 457, 277 P. 185; County of Sonoma v. Hall, 132 Cal. 589, 62 P. 257, 312, 65 P. 12, 459.

As plaintiff and his predecessors in interest had lost the right of recovery on the note and mortgage long before any trees growing on the mortgaged property had been cut, plaintiff was not damaged by reason of any waste committed by any defendant.

Defendants Cross, Scott and Holbrook urge that the appeal is ineffective as to them because the notice of appeal was filed after the time prescribed by statute. This contention is probably correct.

Their motions for nonsuits were made and granted on July 22, 1938. On that same day the order of the trial court granting the nonsuits was entered on the minutes of the court. This became the final judgment of the court as to those three defendants regardless of the fact that a more formal judgment was subsequently entered. § 581, Code Civ.Proc.; Southern Pacific R. Co. v. Willett, 216 Cal. 387, 14 P.2d 526; Tromanhauser v. Grisemer, 123 Cal.App. 153, 11 P.2d 32.

On September 21, 1938, plaintiff gave notice to defendants Scott, Holbrook and Cross and their attorneys of his intention to move for a new trial. No formal ruling was made on this motion. The notice of appeal was filed on December 28, 1938. It is clear that the notice of appeal from the judgment of nonsuit was filed too late. § 939, Code Civ.Proc.

The judgments are affirmed.

MARKS, Justice.

We concur: BARNARD, P.J.; GRIFFIN, J.