Bank of Perris v. Sandor

MARKS, J.

This is an appeal from a judgment and from an order denying a new trial in an action to foreclose a chattel mortgage, with a cross-complaint for damages. The trial court denied relief to both parties.

Plaintiff is a banking corporation with its principal place of business in Perris, in Riverside County. Defendants were farmers who did their banking business with plaintiff.

On September 29, 1931, defendants were indebted to plaintiff in the sum of $1730. They executed their promissory note for that amount and secured it by a chattel mortgage. They were not able to pay the indebtedness when due and voluntarily delivered part of their chattels to plaintiff for sale. These were sold at prices approved by defendants and part of the money was credited on the indebtedness. Plaintiff gave the balance of this money to defendants as they were hard pressed financially and needed it. Some of the chattels were sold by defendants and the money retained by them without the knowledge or consent of plaintiff.

On March 30, 1934, there was an unpaid principal balance of $672.78 on the note, together with interest from October 29, 1932. Plaintiff brought suit to foreclose the chattel mortgage. .

On October 23, 1931, F. E. Sandor executed a bill of sale to plaintiff of personal property which contained among the articles sold some of the mortgaged property. Defendants received due credits for the selling price of these articles.

After the action was filed, and to compromise the matter, on April 5, 1934, F. E. Sandor executed another bill of sale to plaintiff and delivered the property to it. As a part of the same transaction, two days later, defendants executed the following instrument :

“RELEASE

“For and in consideration of the sum of One Dollar ($1) this day to us paid and other valuable considerations, we hereby release the Bank of Perris, a corporation, from any and all claims which we or either of us may have against it,

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of every kind and description up to the date of this release. We also declare that we have unconditionally delivered possession to said bank of all the personal property secured by the chattel mortgage which was sought to be foreclosed in the complaint in the action by said bank against us, being number 25307 of the files of the Superior Court of the State of California, in and for the County of Riverside.