Sarnighausen v. Scannell

SHAW, J.

Plaintiff sues to recover upon a non-negotiable promissory note transferred and assigned to him by Juliette and Mary E. Burns, to whom the note had been made and executed by the defendants.

Judgment was rendered against defendants Hawk and Martin (service of process not being obtained upon Scannell), from which, and an order denying their motion for a new trial, they prosecute this appeal.

As a defense to the action, Hawk and Martin allege in their answer that at the time of the making and delivery of the note to plaintiff’s assignors the latter did, for the purpose of securing the former to sign the same and for the benefit of said Hawk and Martin, execute and deliver to defendant J. O.

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Scannell a certain agreement in writing, prepared by defendant Martin, which is as follows:

“This agreement entered into this 3rd day of May, 1907, by and between J. 0. Scannell, party of the first part, and Dr. Juliette and Mary E. Burns, party of the second part, both of the city and county of Los Angeles, state of California.

“Witnesseth: That for and in consideration of the sum of two thousand five hundred dollars ($2,500) to be loaned to the said party of the first part by the party of the second part,

“One thousand dollars ($1,000 )of said loan to be paid in cash, receipt of which is hereby acknowledged. The remaining one thousand five hundred dollars ($1,500) to be paid on or before thirty days from date of this agreement.

“The party of the first part agrees to give his note for the one thousand dollars ($1,000) the cash sum paid him on this contract this date. Said note to be dated May 3rd, 1907, and maturing on or before one year from said date, and said note to be endorsed by Mr. R. M. Martin and Mr. J. K. Hawk, all of the city and county of Los Angeles, state of California.

“It is further understood and agreed that this sum of two thousand five hundred dollars ($2,500) is to be secured by the filing with the Title Insurance and Trust Company this agreement and that they as trustee for the party of the first part will make a trust agreement with the party of the second part to secure the payment of the aforesaid two thousand five hundred dollars ($2,500) coming after a trust agreement of seven thousand dollars ($7,000) now bearing against the undivided one-half interest in and to the twenty-eight (28) feet on the plaza by sixty and one-half (60%) feet on Los Angeles street. This lot covered by a two-story brick building. The title to the said undivided one-half interest of the party of the first part now resting in the Title Insurance and Trust Company as trustee.