Muir v. Hamilton (1908) · DecisionDepot

Muir v. Hamilton

Name: California Superior Court Tentative Rulings
Creator: DecisionDepot
License: https://creativecommons.org/licenses/by-nc/4.0/

California Supreme Court Jan 20, 1908 No. Sac. No. 1246.Published

Before: Henshaw

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Holding. The court held that because the promissory notes and the deed were given as security for a contingent legal fee that never materialized, the consideration for those instruments failed, entitling the plaintiff to have the deed canceled and his title quieted.

Issues

Whether the promissory notes and deed were given for a contingent fee that failed upon the adverse outcome of the underlying litigation.
Whether the maker of a promissory note may show a failure of consideration by parol evidence as between the original parties.

Disposition. affirmed

Quotations verified verbatim against the opinion

“as between the original parties to an instrument nothing is better settled than that the maker may show an original lack of consideration, or subsequent failure of consideration”

Synopsis

Negotiable Instruments—Want or Failure of Consideration—Evidence.—As between the original parties to a negotiable instrument, the maker may show an original lack of consideration, or subsequent failure of consideration, and such lack or failure of consideration may be shown by parol.

Id.—Deed Given as Security—Quieting Title—Cancellation.—As between the original parties, the grantor in a deed given to secure the payment of promissory notes, the consideration of which has failed, may maintain an action to quiet his title to the premises conveyed, and for the cancellation of the deed.

HENSHAW, J.

Plaintiff brought his action to quiet title to certain parcels of land situated in the county of Placer. The gravamen of the action rests upon the following facts which plaintiff alleges, and which the court found upon ample testimony to be true. In the year 1897 plaintiff was engaged, as plaintiff, in a certain litigation with P. P. Tuttle. He employed the defendants, father and son, who were attorneys at law, to prosecute on his behalf this litigation, under an agreement that the defendants were to devote their time and legal services to the prosecution of the action, and in the event that its final determination should be in favor of plaintiff, defendants should receive as compensation for their services the sum of five thousand five hundred dollars, of which sum the defendant George W. Hamilton was to receive

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two thousand five hundred dollars, and the defendant Joe Hamilton was to receive three thousand dollars. In the event, however, that the action was determined adversely to plaintiff, defendants were to receive no compensation whatever. For the purpose of securing this contingent obligation plaintiff executed and delivered to the defendant Joe Hamilton his promissory note for three thousand dollars, and to the defendant George W. Hamilton his promissory note for two thousand five hundred dollars. Furthermore, for the sole purpose of securing the payment of this contingent fee, so evidenced by the promissory notes, plaintiff executed a deed of all the property here in controversy to defendant George W. Hamilton. At the time it was agreed that this deed should be deposited by way of escrow with the defendant Joe Hamilton, and the defendant Joe Hamilton would hold the same in escrow until the final determination of the action of Muir

Tuttle. In the event that the action of Muir

Tuttle was finally decided in favor of plaintiff, Joe Hamilton was to deliver the deed to the defendant George W. Hamilton, who, under these circumstances would take the same as security for the contingent fees. But in the event that the action of Muir

Tuttle was finally determined in favor of defendant, said Joe Hamilton agreed to redeliver to plaintiff the deed and the promissory notes. The action of Muir

Muir v. Hamilton

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Synopsis

HENSHAW, J.

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