McConnell v. Estate of Gaut

WELLER, J.

This action was brought to recover judgment against Helen Lukens Gaut, as administratrix of the estate of Jas. H. Gaut, deceased, and in her individual capa

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city, in the sum of $6,700, on account of certain moneys alleged to have been loaned by plaintiff to the decedent and his wife, the said Helen Lukens Gaut. The court below rendered judgment against the administratrix for the amount prayed, but denied relief as against her individually. From the latter portion of the judgment plaintiff appeals.

The following facts are shown by the findings: On December 15, 1913, the decedent, Jas. H. Gaut, was the owner of certain real property in Riverside County, subject to five encumbrances, aggregating $15,300, one, a mortgage in the sum of $6,000, signed. by Gaut and wife, being held by plaintiff. On or about that date plaintiff and Jas. H. Gaut entered into a contract whereby they agreed that the property should be cleared of the encumbrances, that plaintiff would loan Gaut $6,700, that the latter should execute to plaintiff two promissory notes, each for $6,350, secure their payment by a mortgage upon the .above-mentioned property, and procure his wife, the defendant, Helen.Lukens Gaut, to sign the notes and mortgage. Prior to this, Gaut had borrowed the sum of $1,200 from plaintiff and had given him a note signed by himself and wife, securing the payment thereof by a grant deed to the property, plaintiff, in turn, giving a receipt which, after stating that the deed was held as collateral security for the payment of the note, reads:

“I have accepted this deed with the understanding in event said James H. Gaut should fail to pay said note then I am at liberty to record said deed and take possession of said property. In event, however, said note is paid, I agree to return said deed to James H. Gaut or assigns.

“(Signed) E. McConnell.”

Subsequently, plaintiff gave cheeks to Jas. H. Gaut amounting to some $5,500, which, together with the $6,000 mortgage and the $1,200 note, made up the sum of $12,700, for which the notes and mortgage mentioned in the agreement were to be executed. Plaintiff then deposited releases of the mortgages held by him with the Title Insurance & Trust Company, with instructions to record them on delivery of the $12,700 note and mortgage. These instructions were approved by Jas. H. Gaut, who also agreed to pay to the depositary the sum of $2,500 for the purpose of satisfying other liens and clearing title to the property. Before the