Wolfert v. Guadagno

DOOLING, J.,

pro tem.

The question involved upon this appeal as stated on the first page of appellant’s opening brief pursuant to subdivision 2 of Rule VIII of the Rules for the Supreme Court and District Courts of Appeal uses the letters A, B and C to designate the names of certain individuals involved in the transaction. Substituting for these letters the names of those persons as they appear from the record that statement will then read: “Appellants purchased realty from respondent giving their note payable in instalments, secured by second deed of trust as part of consideration. Thereafter they conveyed to Smythe. Thereafter, and without the consent of appellants Smythe conveyed to Poliak and Poliak to Crothers. Transferees assumed payment of appellants’ note and were accepted as payors by respondent. Respondent demanded of Crothers insurance different from that provided in deed of trust. Crothers defaulted in his payments and respondent gave notice of intention to sell under trust deed. Prior to sale respondent notified tenants to pay rent to him and to nobody else while trust deed provided for payment to trustee in such case.

“Thereafter the property was sold under trust deed. Respondent bought it for less than residue of debt and sued appellants, but not the subsequent transferees, for deficiency and had judgment from which appellants appeal.

“Appellants contend that when they sold to Smythe he became the principal obligor and they sureties and that by virtue of the subsequent transfers to Poliak and Crothers and the dealings between respondent and Crothers, contrary to the provisions of the trust deed, they were released”. For simplicity we have used in this statement “Poliak” and “Crothers” although the transfers were in fact to Poliak and wife and to Crothers and wife. Wherever in this opinion Poliak or Crothers is used the reference will be understood to include both husband and wife.

[663]

It will be observed from this quoted statement that the keystone of the structure of appellants’ argument is found in the claim that “transferees assumed payment of appellants’ note and were accepted as payors by respondent”. Upon this assumption appellants claim: 1. That the substitution of Poliak and Crothers as principal obligors in place of Smythe discharged appellants as sureties for Smythe, and 2. That respondent’s dealings with Crothers as principal obligor contrary to the provisions of the trust deed likewise discharged appellants. If the keystone of this argument falls it must carry the whole structure with it into collapse.