Garlock v. San Diego Trust & Savings Bank

BARNARD, P. J.

The plaintiffs have appealed from a judgment in favor of the defendants entered after an order sustaining general and special demurrers to a fifth amended complaint without leave to amend.

The complaint alleges that on February 5, 1931 (apparently 1929 was intended), the first three named defendants agreed with the plaintiffs and with each other to loan to the plaintiffs the sum of $5,500 to be used in the construction of certain buildings upon described real property owned by the plaintiffs. Copies of the application for the loan, the escrow instructions and the trust deed made and given in connec

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ti on with said loan agreement are attached to and made a part of the complaint. It is alleged that by oral agreement among the parties, the trust deed securing the loan was executed in favor of the Metropolitan Guaranty Corporation; that this trust deed was assigned to the San Diego Trust & Savings Bank; that this bank advanced money to plaintiffs on said loan from time to time as construction progressed; that the plaintiffs recorded legal notice of completion on July 19, 1929; that the bank made advances according to the terms of the loan agreement until notice of completion was filed, at which time these advances totaled $3,789; that thereafter and before the time for filing mechanics’ liens had expired these defendants orally repudiated said loan agreement and refused to advance any more funds thereunder; that the defendants wrongfully withheld and are withholding the balance of said loan in the sum of $1711; that by reason of said refusal to make further advancements mechanics’ liens aggregating a total of $2,000 accrued and foreclosures thereof were filed against the property; that the plaintiffs were compelled to and have paid and discharged said claims; that on or about May 5, 1930, these defendants caused the $5,500 note and trust deed to be assigned to a third party for the sum of $4,125, which sum included interest, brokerage and other items of expense; that this third party promptly began foreclosure proceedings; and that by reason of said foreclosure proceedings in connection with the said trust deed and the said liens, and by reason of the cloud upon the title to their property, the plaintiffs were unable to refinance their property and prevent a foreclosure, so that the same has become lost to them since the beginning of this action. It is alleged that the plaintiffs have been damaged in the sum of !$2,000, which amount they were compelled to pay in order to discharge the mechanics’ liens, and in the further sum of $1848.33 by reason of money expended by them from their private funds in completing the building, and the prayer is for '$3,848.33, with interest. In the application for the loan, which is alleged to be a part of the agreement and which is made a part of the complaint, the plaintiffs agreed as follows: