Doe v. Culverwell

California Supreme Court Jul 1, 1868Published

Before: Crockett

AI Brief

AI-generated · verify before citing

Holding. The court held that an oral agreement to convey property in satisfaction of a debt that lacks definite terms, mutual obligations, or specific consideration is unenforceable in equity. Furthermore, the court held that the insurance company's mortgage interest was superior to the defendant's claims because the mortgage was part of the same transaction by which the borrower acquired title.

Issues

Whether an oral promise to convey property in exchange for an unspecified debt creates an enforceable equitable title.
Whether a mortgage executed simultaneously with the acquisition of title is superior to prior alleged equitable interests.
Whether payments made on a mortgage debt must be credited against specific portions of the loan rather than the total balance.

Disposition. affirmed

Quotations verified verbatim against the opinion

“The transaction between Oulverwell and Mrs. Knight created no equitable title in her to the house and lot which could have been enforced in a Court of equity”

“To be obligatory on either party, a contract must be mutual and reciprocal in its obligations.”

“The deed from Meyer to Culverwell, and the mortgage from the latter to the insurance company, was one transaction. The title which he acquired by the deed, eo instants became subject to the mortgage.”

Synopsis

Contracts—When Valid.—A contract, to be obligatory on either party to it, must be mutual and reciprocal.

Idem—Courts op Equity.—Courts of equity will not attempt to enforce vague and shadowy claims.

Idem.—C. purchased certain lots, and borrowed the purchase money from M., to whom, as security for the loan, C. caused a deed, in form absolute, to be made by the seller, upon the agreement that when payment should be made of the money loaned, and interest, together with certain additional advances made to C. by M., the latter should convey the lots to C. To discharge this indebtedness C. negotiated a loan of C. I. Co. of a sum sufficient to liquidate M/s demands, and fifteen hundred dollars in addition, upon the agreements, which were fully executed, that C. should pay M. and receive from him the promised conveyance, and simultaneously execute a mortgage of the lots to C. I. Co., to secure said last loan. Subsequently C. I. Co. assigned an unpaid balance of its demand, together with said mortgage, to plaintiff, who brought suit to foreclose and make K. a party defendant, to whom C. being indebted at the time of said purchase, and by reason thereof had promised K. to buy for her a lot and thereon build a house which should become her property. While said lots stood in M.'s name, C. pointed out to K. one of them as the one intended, built a house thereon, and K. went into possession, and so continued until said suit. There never was, however, any accounting between C. and K. at any time, or any price agreed or fixed on said lot. Held, that this transaction created no equitable title in K. which could have been enforced in a Court of equity as against C., if the title had been in him, and is void as a defense to plaintiffs said action.

By the Court, Crockett, J.: There is little or no contest about the facts of this case, which are: that the defendant Culverwell purchased from the estate of Russ certain lots in San Francisco, and borrowed the money from one Meyer to pay for them, and as a security for the loan, it was agreed that the vendor should convey the [293]property by absolute deed to Meyer, to be by him. conveyed to Culverwell on payment of the amount advanced, Avith interest. In accordance with this arrangement, the title was conveyed to Meyer by deed absolute, which was. intended, hoAvever, to be only in the nature of a mortgage, and was treated by the parties as such. On the faith of this security, Meyer made further advances to Culverwell, so that on the 17th of February, 1866, there was due from Culverwell to Meyer, in the aggregate, the sum of seven thousand five hundred dollars. In order to discharge this indebtedness, Culverwell negotiated a loan from the California Insurance Company for nine thousand dollars, of Avhich sum it was agreed that seven thousand five hundred dollars should be applied to extinguish the debt of Meyer, and that Meyer should then, simultaneously, convey the property to Culverwell, by deed, who should, at the same time, make a mortgage on it to the insurance company, to secure the payment of the nine thousand dollars, with interest. This agreement was carried into effect. The insurance company paid the debt due to Meyer, and advanced to Culverwell the further sum of one thousand five hundred dollars, and thereupon Meyer conveyed the property to Culverwell, who immediately made a mortgage on it to the insurance company, to secure the nine thousand dollars. Subsequently, Culverwell paid to the insurance company five thousand dollars, which was credited on the mortgage debt; after which the insurance company assigned the mortgage and balance due of the mortgage debt to the plaintiff Doe, who brings this action to foreclose the mortgage, making Knight and wife, amongst others, parties defendant. The defendants Knight and wife filed an answer and cross complaint, in Avhich the wife sets up an alleged equity to one of the lots, founded on the following facts, to wit: That the wife of Culverwell and Mrs. Knight are sisters, and that in the years 1861 and 1862 Culverwell received from Germany certain moneys belonging to his wife and Mrs. Knight, which he used in his oavh business, with the consent of Mrs. Knight, on his promise to account to her [294]

Doe v. Culverwell

AI Brief

Synopsis

More from California Supreme Court

Related research

AI Brief