Visalia Savings Bank v. Curtis

HARRISON, J.

S. Z.

Curtis executed his promissory note to the plaintiff, January 6, 1896, for the sum of twenty thousand dollars, payable one year thereafter, with interest thereon at the rate of ten

per cent per annum,

together with a mortgage upon certain real estate to secure its payment. He died April 4, 1896, and the appellant W. M. Curtis was appointed the administrator of his estate. After the making of the note, the plaintiff presented to the administrator its claim thereon in proper form, and the same was allowed and approved by the judge and filed with the clerk. Thereafter he brought the present action for the foreclosure of the mortgage, alleging that the said estate is insolvent, and the administration thereof still pending, and in the complaint expressly waived all recourse against any other property of the estate than that described in the mortgage. The court rendered judgment in its favor for the amount due upon the promissory note, computing the interest thereon at ten per cent per annum, and directed that the mortgaged premises be sold, and that the plaintiff be paid so much of the amount found due to it as the proceeds of said sale would pay. The present appeal is from this judgment upon the judgment-roll, without any bill

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of exceptions. In support of the appeal, the appellants contend that, inasmuch as the estate of the mortgagor is insolvent, the plaintiff is not entitled to receive interest upon its note at a greater rate than seven per cent

per annum.

This contention is based upon the following clause in section 1494 of the Code of Civil Procedure-. “If the estate be insolvent, no greater rate of interest shall be allowed upon any claim after the first publication of notice to creditors than is allowed on judgments obtained in the superior court.”

The “claim” referred to in this section is that which, by the preceding section, must be presented to the administrator or executor for allowance, or be “barred forever,” and which, when “allowed” and filed in the court, is, under section 1497, “ranked among the acknowledged debts of the estate, to be paid in due course of administration.” The rule therein limiting the rate of interest is a direction to the administrator or executor in determining the amount to be “allowed” by him upon the claim when the estate is insolvent, and which is to be paid out of the general assets of the estate, but has no application to the action of a court in a suit for the foreclosure of the mortgage. Section 1500 of the Code of Civil Procedure gives to the holder of a mortgage the right to enforce the same “against the property of the estate subject thereto,” without any presentation of the claim to the executor or administrator.