Morlock v. Fink

California Court of Appeal Mar 11, 1927 No. Docket No. 5553.Published

Before: Koford

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Holding. The court held that a defendant who receives money under an agreement that is not fully performed is obligated in equity and good conscience to return the funds, supporting a judgment for money had and received regardless of surplus findings regarding express contract terms.

Issues

Whether a defendant who fails to perform an agreement to provide security for a loan is liable for the return of funds received under a theory of money had and received.
Whether the trial court erred in allowing an amendment to the complaint to conform to proof without permitting the defendant to file a new answer.

Disposition. affirmed

Quotations verified verbatim against the opinion

“If appellant would not go through with the agreement for as much as had been advanced, he could not keep the money in his possession indefinitely but was bound in equity and good conscience to return it.”

“The facts make a clear case in favor of plaintiff for money had and received.”

“Surplus allegations added to the count for money had and received may be disregarded like surplusage in other forms of pleading.”

KOFORD, P. J.

The assignor of the plaintiff, Mrs. Vierhus, together with a Mrs. Tisney agreed to lend the defendant $5,000. Each was to contribute $2,500. Mrs. Tisney expressed doubt of her ability to raise her share, but the appellant claims the agreement was that the full sum of $5,000 was to be lent. Defendant agreed to give security for the loan by executing a mortgage on a certain paint factory and machinery in Alameda. The mortgage was not executed but Mrs. Vierhus advanced $2,500, and later when Mrs. Tisney proved unable to raise her share Mrs. Vierhus, upon the importunities of appellant, advanced the further sums of $1,000 and $350, making a total of $3,850. This action was to recover that sum. The defendant paid $1,000 after the action was commenced. Plaintiff was given judgment for the remainder, or $2,850. Defendant appeals from the judgment.

Mrs. Vierhus demanded of appellant (defendant) that he execute a note or give the security mentioned above for so much as had been advanced to him by her, she being unable to advance more. This he refused to do. Appellant’s attitude at the trial was that, under the verbal understanding had between the parties to the transaction, he was not obliged to give such note or security because the entire amount agreed upon had not been advanced. It is a disputed point in the evidence as to just what the exact

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verbal agreement was. The matter was carried on in an unbusiness-like way. But, accepting appellant’s interpretation of the transaction as the correct one, he was obliged either to give security for as much money as he had received or return it. Mrs. Vierhus had stated she was unable to raise more money and Mrs. Tisney had proved unable to lend more than $150 of her share. If appellant would not go through with the agreement for as much as had been advanced, he could not keep the money in his possession indefinitely but was bound in equity and good conscience to return it. The facts make a clear case in favor of plaintiff for money had and received.

A somewhat similar state of facts was said to present a case of money had and received in

Whyte

Rosencrantz,

Morlock v. Fink

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KOFORD, P. J.

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