TUCKER v. NICHOLSON

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District Court of Appeal, Second District, Division 1, California.

TUCKER et al. v. NICHOLSON.†

Civ. 11425.

Decided: May 31, 1938

Newton Todd and Fred A. Watkins, both of Long Beach, for appellant. Will H. Winston, of Long Beach, for respondents.

The respondents herein together with Arthur J. Nicholson (now deceased) and several other persons, purchased a parcel of real property, had the legal title thereof conveyed to the Western Trust & Savings Bank, as trustee, and jointly executed a promissory note in favor of Marion M. Lamkin for the balance of the purchase price, said note being secured by a mortgage upon said real property. Said mortgage was foreclosed and a deficiency judgment in the sum of $16,104.37 and interest was entered on August 23, 1932, against nine makers of the note.

On June 28, 1933, an escrow agreement was entered into by and between said Marion M. Lamkin, the judgment creditor, and Frank W. Barnes, one of the respondents herein, and on said date respondent Barnes paid into escrow the amount due on the judgment and there was delivered into said escrow an assignment of the judgment in favor of Will H. Winston, the attorney and trustee for respondents. Thereafter, on July 22, 1933, the money so paid into escrow was delivered and paid to the judgment creditor Lamkin and the assignment of the judgment was delivered to said Will H. Winston. On July 19, 1934, said Will H. Winston made and filed of record a satisfaction of the judgment, and on the same day, pursuant to the terms of section 709 of the Code of Civil Procedure, the three respondents filed a notice and demand for contribution from the other six judgment debtors, of whom A. J. Nicholson was one. Said A. J. Nicholson died on October 31, 1935, and during the course of administration of his estate, respondents filed a creditor's claim seeking contribution from said estate, which claim was rejected on April 17, 1936, whereupon respondents commenced the present action against the executrix of said estate upon such rejected claim. The trial court rendered judgment in favor of respondents and against the executrix of said estate for one–fourth of the amount of the deficiency judgment, together with interest and costs.

It was found by the court: “That on the 19th day of July, 1934, plaintiffs herein paid said Judgment in full including interest from the date of said Judgment at the rate of seven per cent (7%) per annum to the 22nd day of July, 1933, and a Satisfaction of Judgment was filed in the above entitled Court on July 19, 1934, and on said date, July 19, 1934, a Notice and Demand for Contribution was filed by the plaintiffs herein setting forth that they had paid the Judgment and had caused Satisfaction to be filed and claiming and demanding contribution from the defendants. * * * That said Notice of Contribution and Demand was given in accordance with Section 709 of the Code of Civil Procedure of the State of California. That an Abstract of Judgment was recorded on October 5, 1932, in Book 11815 at Page 206 of Official Records of Los Angeles County, California. That no part or portion of said Judgment has been paid by any of said defendants herein named except the plaintiffs to this action and that said Judgment is still in full force and effect.”

Appellant here urges that the finding as to payment of the judgment on July 19, 1934, is unsupported by the evidence; that respondents did not comply with the provisions of section 709 of the Code of Civil Procedure, and that in no event could respondents receive from appellant more than 1/12th of the original judgment.

The finding of the court that the judgment was paid on July 19, 1934, is fully sustained by the legal inferences that should be drawn from the record. The escrow instructions, which are attached to the stipulation of the parties herein, show that respondent Barnes paid into escrow the amount due to the judgment creditor, Marion M. Lamkin, and that the escrow agent was instructed to deliver to Will H. Winston, the attorney and trustee for respondents, an assignment of the judgment in consideration for the payment to said judgment creditor of the sum of $5,816.61 in cash and a promissory note for $11,000 executed by respondent Barnes. It is clear from the undisputed facts and from the face of the record that this cash and note were delivered to said judgment creditor on July 22, 1933, in consideration for the assignment and not as payment upon the judgment, and that the judgment was not actually paid until July 19, 1934, when Will H. Winston, the assignee named in the aforementioned assignment, filed his satisfaction of the said judgment.

It is provided by the terms of section 709 of the Code of Civil Procedure that “When property, liable to an execution against several persons, is sold thereon, and more than a due proportion of the judgment is satisfied out of the proceeds of the sale of the property of one of them, or one of them pays, without a sale, more than his proportion, he may compel contribution from the others. * * * In such case the person so paying or contributing is entitled to the benefit of the judgment, to enforce contribution or repayment, if, within ten days after his payment, he file with the clerk of the court where the judgment was rendered, notice of his payment and claim to contribution or repayment. Upon a filing of such notice, the clerk must make an entry thereof in the margin of the docket.”

Respondents caused to be filed on July 19, 1934,––the day on which the judgment was paid and satisfied of record,––their notice of payment and claim to contribution from their codebtors, which was in strict compliance with the terms of said section 709, supra.

The original deficiency judgment was for the sum of $16,104.37, and in the instant case the trial court rendered judgment against appellant for the sum of $4,026.09, or one–fourth of the amount of said deficiency judgment. Appellant claims this was error, and that any judgment rendered against appellant in any event should not have exceeded one–twelfth of the amount of said deficiency judgment. In support of such contention evidence was introduced at the trial to show that appellant's testator owned a one–twelfth interest in the property given as security for the mortgage, in the foreclosure of which the deficiency judgment was rendered.

Respondents urge that in the case at bar “three men, jointly and severally liable with nine other codefendants jointly and severally liable on a promissory note against whom a joint and several judgment has been rendered, have paid the judgment in full. A fourth is asked to contribute. There is only one fair, equitable and just conclusion and that is that the A. J. Nicholson Estate should be compelled to pay one–fourth of the judgment.”

As a matter of fact the record discloses that the deficiency judgment was rendered, not against twelve persons but against nine persons only, numbering among them the three respondents and A. J. Nicholson, now deceased. At the trial of the instant action, R. E. Hagenbruch, trust officer of the Western Trust & Savings Bank, testified that the declaration of trust, which was entered into at the time the Lamkin mortgage was executed, recited the interests of the owners of the property given as security for such mortgage as follows: Walter F. Lineberger, 2/12ths; Ethel D. Baker, 1/12th; John P. Mills, 2/12ths; Florence H. Lineberger, 1/12th; A. J. Nicholson, 1/12th; George H. Besancon, 1/12th; A. J. Nicholson, 1/12th; George H. Besancon, 1/12th; L. Roy Myers, 1/12th; S. J. Abrams, 1/12th; F. W. Barnes, 1/12th; and Charles H. Tucker, 1/12th. The deficiency judgment omits the names of Ethel D. Baker and Florence H. Lineberger, and adds the name of John S. Lineberger.

In the action at bar we have before us a joint and several judgment for deficiency rendered against nine of the original makers of the note, three of whom are asserting a statutory right of contribution from the other six. It appears to be the rule that “where one of two defendants pays a joint judgment, he will not be allowed to enforce it against a codefendant for a greater sum than is legally chargeable against him as his proportion of the debt”. 6 Cal.Jur. 524, citing Williams v. Riehl, 127 Cal. 365, 59 P. 762, 78 Am.St.Rep. 60; Coffee v. Tevis, 17 Cal. 239. It was said in the case of Williams v. Riehl, supra, at page 371, 59 P. at page 764: “The respondents, by paying the plaintiff, and taking an assignment of the judgment, only became entitled to use it for the purpose of enforcing contribution from their co–sureties or payment from their principal. They are only subrogated to the rights of the plaintiff for the purpose of using the judgment in order to protect themselves and their co–sureties, and for the purpose of compelling contribution. This is not a proceeding in equity, and no claim is made that any co–surety is insolvent. The law presumes that they are solvent. Respondents, therefore, were entitled to execution against appellant for an aliquot part of the debt, based on the whole number of co–sureties. They are liable to contribute in the proportion of the respective amounts or penalties for which they became surety.” The question of insolvency did not arise in the instant case, therefore, the judgment debtors must be presumed to be solvent and liable for an aliquot part of the judgment based upon the whole number of such judgment debtors, to–wit, nine. Since appellant's testator was one of the nine against whom such joint and several deficiency judgment was rendered, it is obvious that his estate can be compelled to contribute no more than one–ninth of the total amount of the original judgment.

The judgment is affirmed, except as to the amount of the instant judgment which should have been rendered for only one–ninth of the original deficiency judgment; therefore, the trial court is directed to enter judgment in accordance with the views herein expressed.

YORK, Presiding Justice.

We concur: DORAN, J.; WHITE, J.