Chester v. Hill

Ross, J. The question here. is, whether or not the court below erred in sustaining a demurrer to the third amended complaint, to which only Xarissa Hill and H. W. Woodward were made parties defendant. This complaint charges that on the 18th of December, 1875, one George W. Chester executed to the firm of Toklas, Hahn & Brown, or order, five promissory notes, for the aggregate sum of $2,341.38, bearing interest at the rate of one per cent, per month. That at that time George W. Chester was the owner and holder of two promissory notes, each for the sum of $3,333.33, with interest at one per cent, per month; which two notes were executed by defendant Woodward to George W. Chester, or order, on the 6th of December, 1875 one of which matured one year and the other two yearsoafter date, and both of which [482]were secured by a mortgage, executed by Woodward, on a tract of land situated in Kern county. That to secure the payment of his notes to Toklas, Hahn & Brown, George W. Chester assigned to that firm the Woodward note first maturing, as also the mortgage securing its payment. That subsequently, to wit, on or about June 12, 1876, Toklas, Hahn & Brown assigned to the defendant Xarissa Hill the notes executed to them by George W. Chester, and also the Woodward note and mortgage, which they held as security for the payment of said five notes of George W. Chester, and that the assignment was taken by defendant Hill, with notice of the facts. That afterwards, to wit, on or about the 15th day of November, 1876, defendant Woodward executed and delivered to the defendant Hill a conveyance of one-half of the land embraced in the Woodward mortgage, for the “nominal consideration of five thousand dollars,” which conveyance was recorded in the office of the recorder of Kern county, and at the same time and for no other consideration than the said conveyance, defendant Hill surrendered to defendant Woodward the Woodward note first maturing, and also executed to Woodward an instrument in writing, purporting to release the Woodward mortgage, in so far as it stood as security for the payment of the Woodward note first maturing, which instrument was thereupon duly recorded in Kern county. That the Woodward note maturing December 6,1877, was paid at its maturity. That the Woodward note first maturing was never paid, in whole or in part, but that defendants Hill and Woodward, “fraudulently colluding with each other, and with the intent and design to cheat and defraud the said George B. Chester out of the surplus value of the collateral security aforesaid, over the amount due on the five George B. Chester notes aforesaid, and to convert the said surplus to their own use, contrived first to bring about the transfer of the George B. Chester notes and collateral, as aforesaid, to defendant Hill; and then, still in pursuance of the same fraudulent intent and design, contrived that the mortgage should appear satisfied of record, as aforesaid; all of which facts were unknown to said George B. Chester and to the plaintiff at the time, and were not discovered either by said George B. Chester or by plaintiff until some time after the said 15th day of November, 1876. That, as plaintiff is informed