First National Bank v. Clifton

LANGDON, P. J.

Defendant has appealed from a judgment against him in an action brought by the plaintiff to recover damages for breach of a contract by which defendant promised to indorse the note of the Bethel Vineyard Company in consideration of a renewal of a loan by the plaintiff bank to said company.

The trial court has found that on the twenty-fourth day of November, 1922, Bethel Vineyard Company was indebted to plaintiff in the sum of one thousand dollars upon two promissory notes'; that at the time Bethel Vineyard Company was a vendee under a contract to purchase from de-> fendant certain real property in the county of Fresno; that said Bethel Vineyard Company upon said day applied to plaintiff for an extension of said loan for one year; that plaintiff was unwilling to grant such extension of said loan in the form in which said loan then stood and upon the security plaintiff then had, but said Vineyard Company represented to plaintiff that if it would grant such extension of said loan, said company would give to plaintiff a new note for said loan and that one K. Horita and the defendant U. J. Clifton would indorse such new note and that said Vineyard

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Company would give to plaintiff for the purpose of securing said note a crop order on the Baisin Growers’ Association for forty per cent of the proceeds of the raisin crop produced upon the land during the year 1923 and that said defendant would indorse said order; that plaintiff agreed to extend said loan for one year upon the said conditions and, thereupon, and on the same day, plaintiff addressed and mailed to defendant the following letter: “We are informed that you are the owner of the land which is being operated by the Bethel Vineyard Company. They owe us at the present time $1,000, and do not seem to have received crop sufficient to liquidate the loan this year and ask for an extension. We do not feel justified in carrying this another year under the present security, as they are only purchasing it under contract, and understand that they still owe you $13,000 and interest. Therefore, we have agreed to renew the loan for another year, if you will endorse the note with a crop order on the 1923 crop for the 40% they are to receive, as we feel that you are amply protected in the matter, as you have it under your thumb, so as to speak, that they will have to pay over the money.