Boal v. Gassen

SLOSS, J.

The cause having been tried, the court made its findings of fact and conclusions of law, and entered a judgment granting certain relief to the plaintiff, Alma L. Boal. On the defendant’s motion, made under section 663 of the Code of Civil Procedure, the court altered and amended its conclusions of law, and entered a different judgment. Alma L. and J. Mills Boal appeal from the second judgment.

The findings are, in effect, as follows: Alma L. Boal was, on December 1, 1911, the owner of a parcel of land in San Diego County. On that day she and her husband, J. Mills Boal, made and delivered their promissory note for seventy-five thousand dollars, payable September 16, 1913, to the defendant, A. G. Gassen, and secured the same by a deed of trust conveying the above-mentioned land to Title Insurance and Trust Company, as trustee. The note contained a provision for accelerating the due date of the principal on nonpayment of interest. In December, 1912, plaintiffs were in default in payment of interest, and were unable to raise funds to pay such interest or the principal of their note. The defendant was aware of their financial condition. The plaintiffs had theretofore conveyed the land to one Brad-beer for convenience in negotiating a loan. The land was, on December 19, 1912, worth two hundred and fifty thousand dollars, and there was then due from the Boals to Gassen $76,293.98. Prior to the last-named date, the said plaintiffs had endeavored, but without success, to obtain from Gassen an extension on their debt. About December 14th, Gassen notified them that, upon their failure to pay an installment of interest to fall due December 16th, he would elect to declare the principal due, unless they would convey the property to him upon the consideration that he would

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cancel and satisfy the note and execute to Bradbeer a certain option, which will be described hereinafter, and that unless said plaintiffs should pay the note or make such conveyance, he would direct the trustee to sell under the deed of trust. On or about December 18'th, the Boals and Brad-beer “assumed to enter into” an agreement whereby plaintiffs were to convey the property to Gassen in payment of the note, and Gassen agreed to execute to Bradbeer an option for the sale, on or before January 1, 1914, of said land to Bradbeer for $136,240, which was forty-five thousand dollars in excess of the debt, together with incidental expensés. The plaintiffs were unable to secure funds with which to pay the debt, and they thereupon agreed to accept the terms proposed by Gassen, and to execute the necessary instruments, but such agreement and the execution and delivery of the instruments thereupon executed “was not the free and willing act of plaintiffs or either of them, but was induced by all of the circumstances surrounding the condition of the parties.” The deed to the defendant was thereupon executed and delivered. The defendant canceled the note and executed a release to plaintiffs, caused the trustee to make a reconveyance of the property to Bradbeer, and executed in favor of Bradbeer an option as above outlined. The plaintiffs, at the same time, signed a writing in which they declared and acknowledged, in the most direct and explicit words, that their obligation and indebtedness to Gassen was extinguished, that they owed him nothing, that the conveyance. to him was absolute, and that the land was held by him free of any claim or interest on the part of any of said plaintiffs. Except as stated, Gassen gave to plaintiffs no consideration for the conveyance so made to him. On March 11, 1914 (after the commencement of this action), the plaintiffs made to Gassen a written offer to pay him ninety-four thousand dollars, being the sum due on December 19, 1912, with interest and expenses, and defendant refused to accept the same, claiming to be the owner of the land. Plaintiffs have not paid anything on account of said indebtedness. It was found that “there is now due and owing by plaintiffs, J. Mills Boal and Alma L. Boal, to defendant Gassen” the principal of the promissory note, with interest and sums paid for taxes, aggregating $97,812.82. The- plaintiff did not at any time