Crescent Lumber Co. v. Larson

SLOSS, J.

This action was brought by plaintiff as indorsee of a promissory note for $5,734.44, dated August 27,1909, payable one day after date, and made by the defendant William Larson to the Harbor Lumber Company or order. The complaint alleged that, with the exception of four hundred and thirty dollars paid on the principal, no part of the principal or interest due on the note had been paid.

The defendant’s answer, after denying plaintiff’s corporate capacity, and the indorsement to plaintiff, alleged that the note had been fully paid. By way of cross-complaint, he alleged that plaintiff was indebted to him in the sum of eight hundred and fifty-five dollars for money had and received to defendant’s use. Plaintiff filed an answer to the cross-complaint, denying its material allegations.

The cause having been tried without a jury, the court made its findings to the effect that plaintiff was a corporation as

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alleged, and that Harbor Lumber Company, the original payee, had indorsed the note to plaintiff. It further found that defendant had deeded to plaintiff’s agent certain real property as security for the payment of said promissory note, and with the understanding and agreement that said agent was to re-convey the real estate to the defendant within ninety days, provided defendant paid within said time the sum of five thousand six hundred and four dollars, the balance due on said note; that defendant did not pay any part of said sum, except seven hundred dollars, within the ninety days; that plaintiff’s said agent did not reconvey the realty, but that said realty is still retained for plaintiff as security for the payment of said note and that plaintiff, by reason of said transaction and said payment, became indebted to defendant in the sum of seven hundred dollars, for money had and received.

The conclusions of law were: 1. “That the action cannot be maintained by plaintiff until the security be first exhausted, and that plaintiff take nothing by its action;

2.

That defendant have judgment against plaintiff on his cross-complaint for $700.00, interest and costs.”

Judgment in defendant’s favor for seven hundred dollars with interest and costs was accordingly entered.