Hewitt v. Security-First Nat. Bk. of L.A.

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CONREY, P. J.

The present controversy arose out of an exchange of property between the plaintiff Hewitt and one W. S. Everett. After the transaction had been completed, Everett died and an administrator of his estate was duly appointed. A creditor’s claim was presented by Hewitt and rejected by the administrator. Hewitt then brought this action to enforce his said claim. From a judgment entered in favor of the plaintiff, the defendant administrator has presented this appeal.

The contract under which the exchange of properties occurred was in the form of written “escrow instructions” delivered by Everett to the escrow-holder, together with corresponding escrow instructions of same date signed by plaintiff Hewitt and his wife, and delivered to same escrow-holder. The instructions of each party were accompanied by certain described documents, to be delivered to the other party on performance of the concurrent conditions prescribed in the several instructions. These escrow instructions were dated September 13', 1927, and in due course the transaction was completed and closed. Among the documents delivered to Hewitt, as part of the consideration for the property conveyed by him, there were three promissory notes of Magnetic Ice Co., a corporation, payable to the order of W. S. Everett, on which there remained unpaid and due the total sum of $2,700, besides interest. Said notes were accepted by plaintiff in his contract with Everett as of the value of $2,700. In the verified claim presented to the administrator by the claimant, as well as in the complaint, it is set forth that the notes were by Everett indorsed “without recourse”. But it was stated in the claim as presented, and is alleged in the complaint that at the time of the indorsement, assignment and delivery of said notes Everett represented and warranted to the claimant Hewitt that the maker of said notes, the Magnetic Ice Co., was solvent and able to pay its obligations as they accrued; whereas in fact, at the time of such indorsement, assignment and delivery the said Magnetic Ice Co. was insolvent and that fact was known to the said Everett; that no part of said sum of $2,700, either principal or interest, has been paid, etc. In the complaint in this action it is further alleged that at the time of said indorsement and

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