Trinity County Bank v. Haas

SLOSS, J.

The defendants appeal from a decree foreclosing a- mortgage and from an order denying their motion for a new trial.

On January 11, 1904, the defendants F. G. Haas and Emily E. Haas made and deliverd to plaintiffs their promissory note for $5,969.73, payable one year after date, with interest thereon at the rate of one per cent per month from date until paid, said interest payable quarterly, and, if not so paid when due, to be added to the principal and to bear interest at the same rate as the principal sum. On the following day, said defendants executed and delivered to plaintiffs a mortgage of real property to secure their note. The mortgage provided that “in ease default be made in the payment of the said principal or any installment of interest as provided, then the whole sum of principal and interest shall be due at the option of the said parties of the second part [the payees], or assigns. ’ ’

On September 6, 1904, the defendants F. G. and Emily E. Haas conveyed to the defendant Joseph Elliott the greater part of the mortgaged premises, Elliott assuming the payment of the mortgage debt.

The first installment of interest, payable on April 11, 1904, was paid when due. This action was commenced October 17,

[555]

1904, the plaintiffs alleging in their complaint that no further interest had been paid, and “default having been made in the payment of the sum of interest due July 11th, 1904, plaintiffs, in accordance with the terms of said mortgage elect to declare the whole of said principal sum and interest thereon from April 11th, 1904, now due and payable.” The answers allege that all interest due upon said note or by said mortgage “has been heretofore paid, and that the principal sum of said .note and mortgage is not yet due.” The court found against the plea of payment; found that plaintiffs had, on or about the third day of October, 1904, elected to declare the principal and interest due, and, as has been stated, granted to plaintiffs a decree of foreclosure.

The finding that the interest had not been paid is attacked as unsupported by the evidence. It appears, without contradiction, that on October 11, 1904, six days before the commencement of the action, the defendant Elliott, who had assumed the payment of the note and mortgage, tendered to the plaintiffs the interest then due, comprising the two installments payable respectively on July 11, 1904, and October 11, 1904, and amounting to about $368.20. The tender was refused on the ground that plaintiffs had exercised their option “of considering both principal and interest due on that note and that the [their] money was not sufficient.” The defendant Elliott immediately deposited the sum of three hundred and seventy-five dollars in gold coin in the name of plaintiffs in a bank of deposit of good repute and gave notice thereof to plaintiff. (Civ. Code, sec. 1500.) There is no evidence that at any time prior to October 11th the plaintiffs notified any of the defendants they had elected to declare the principal of the note due, or that they ever demanded payment of such principal. Evidence offered by defendants to show that plaintiffs had not given such notice or made such demand was excluded. The agent of plaintiffs was allowed to testify, over defendants’ objection, that two weeks before the commencement of the suit he had elected to declare the whole note due and payable and had directed the attorneys of the plaintiffs to proceed to foreclose the mortgage.