Miller v. Mountain View Savings & Loan Ass'n

SIMS, J.

Defendant Mountain View Savings and Loan Association has appealed from a judgment awarding plaintiff the sum of $5,450, and interest, for plumbing material and labor furnished at the request of defendant owner to five lots on which appellant granted secured loans which were foreclosed by sales under the deeds of trust. The owner defaulted and has not appealed from the adverse judgment against him.

Appellant attacks the findings of fact and conclusions of law of the trial court insofar as they tend to support the right of respondent to recover. The issues raised are whether or not respondent subcontractor obtained a right to reimbursement from the lender by reason of an unbonded stop notice filed under the provisions of section 1190.1 of the Code of Civil Procedure; whether or not he acquired any such right by reason of an equitable lien, and the effect, if any, either on the foregoing claims or independently, of the fact that appellant after buying the property resold it at a substantial profit which more than encompassed the sum sought by respondent. It is conceded that any interest in the real property itself, which respondent might otherwise have acquired by reason of recording a mechanic’s lien, was extinguished by the sale under the prior deed of trust held by appellant.

[648]

The trial court found that the defendant White and his wife on April 19, 1963, were the owners of the five lots to which the labor and material were subsequently furnished by respondent. The evidence reflects that appellant conveyed the premises to the Whites by deed dated April 19, 1963, and recorded on April 29th. Of the $9,500 purchase price received for each lot, $5,900 was credited to the purchasers from the proceeds of notes secured by deeds of trust executed by the Whites and recorded at the same time as the deed.

The findings set forth that on April 19th the Whites entered into a building and loan agreement with appellant as to each separate lot, pursuant to which appellant agreed to loan $39,000 on each of four lots, and $39,500 on a fifth lot; that the agreements provided for five progressive payments for the construction on each of the lots of a four-unit apartment house with carports, and that “The payments from the loan were for the sole benefit of labor and materials rendered and furnished in the construction of these respective units. ’ ’ Reference to the agreements reveals that each provides for a $5,900 payment to be paid upon recordation, and for the payment of a loan fee, trustee fee, and tax lien service fee to be paid by deduction from the loan proceeds.