Bank of America National Trust & Savings Ass'n v. Standard Oil Co.

EDMONDS, J.

Bank of America National Trust and Savings Association is the respondent on an appeal from a judgment rendered in an action brought by it for declaratory relief and instructions in aid of the administration of a trust and the disposition of funds held thereunder. By the present proceeding it seeks a writ of

supersedeas

staying the execution of the judgment pending the determination of the appeal.

Petitioner is the successor trustee under a trust indenture executed by Bastanchury Ranch Company to secure an issue of bonds in the principal amount of $1,500,000. Subsequent to the execution of this instrument the trustor executed a crop mortgage to Maria O. Bastanchury, which mortgage was assigned to Union Bank and Trust Company of Los Angeles. Later, petitioner entered into an agreement with the trustor and Standard Oil Company of California wherein the latter company agreed to advance approximately $87,000 for pest control on property subject to the trust indenture. Less than a month afterward, Consolidated Securities Company commenced an action to foreclose a junior encumbrance on this property. A receiver for the assets of the trustor was appointed in that action and, pursuant to the request of the receiver, the petitioner consented that Consolidated Securities Company might advance the sum of $50,000 to protect the property. However, the petitioner alleges that it does not know how much money, if any, was advanced by Standard Oil Company of California or Consolidated Securities Company under their respective agreements.

At a subsequent time, petitioner took possession of the property described in the trust indenture and afterward sold and conveyed it to Alfred R. Thomas, Harold D. Spear and Walter C. Austin, constituting a protective committee formed by the owners of over 90 per cent of the outstanding bonds

[92]

secured by the deed of trust, for the sum of $610,000. The controversy in the action for declaratory relief concerns the right to the proceeds of this sale.

The defendant Standard Oil Company of California on its own behalf and as assignee of Consolidated Securities Company claims the sum of $44,421.38 with interest, and Maria O. Bastanehury, also a defendant, claims the sum of $40,846.39 from the money now held by the petitioner. Contrary to these contentions the defendant, Sunny Hills Ranch, Inc., as assignee of the bondholders’ committee, asserts that the proceeds of the sale of the property should be paid to it for the benefit of the bondholders. The superior court decreed that Standard Oil Company of California should recover from plaintiff $24.15 and ordered the petitioner to pay 91.7949 per cent of the remainder of the amount in its possession, after the deduction of this sum and interest thereon and all costs and expenses properly incurred or chargeable by it, to Sunny Hills Ranch, Inc., and the balance to the owners and holders of bonds not deposited under that agreement. The execution now outstanding was procured by Sunny Hills Ranch, Inc., upon this judgment several months after a notice of appeal therefrom was filed by the defendants Standard Oil Company of California and Consolidated Securities Company.