Zellerbach v. Allenberg

Myrick, J. The complaint in this case was filed to set aside, on the ground of fraud, a judgment which had been [297]obtained, by Allenberg and Goldstein against Zellerbach. In the court below, judgment on demurrer was rendered for the defendants.

The case, as presented by the plaintiff herein, why the judgment in the former case should be set aside, is substantially as follows: Allenberg and Goldstein commenced an action against Zellerbach to foreclose a mortgage executed by the latter to Allenberg. In the complaint in that case, it was alleged that the mortgage was given to secure the payment of a note for §50,000 and interest, executed by Zellerbach to Goldstein, an indebtedness of Zellerbach to Allenberg of §9,000 and interest, and advances and loans to be made by Allenberg to Zellerbach. It was also alleged that Allenberg paid out §25,000 in excess of issues, in the management of the mortgaged property. The mortgaged property consisted of several mines and ditches and appurtenances, embracing all the property of Zellerbach in the county, together with 30,000 shares in a mining company, and 1000 shares in a canal company. Zellerbach, in his complaint in this case, avers that, in his answer in the former case he admitted the making of the note and the indebtedness to Gold-stein, but claimed that Allenberg had received §14,000 for dividends on the canal company stock, and §1,500 cash. ■

The court in that action found that Zellerbach was indebted, on the obligations alleged in the complaint therein, in the sum of §91,474.15, and that Allenberg had paid out §11,251.41 in the management of the property, and rendered judgment of foreclosure and sale. The plaintiff Zellerbach then proceeded in his complaint in this action, to aver that he was extensively engaged in business; that Allenberg was his confidential agent and manager of his business, having almost exclusive control thereof; that Allenberg represented to plaintiff that money was needed to carry on the business, and that Goldstein had money to loan; that acting solely on the representations of Allenberg, he drew on Goldstein for §30,000, which was paid; that Allenberg handed plaintiff §7,853.15, representing it to be a loan from Goldstein, and that the §50,000 note was given for these sums and interest thereon; that at the time he gave the note, and when the decree was rendered in the former action, he believed he was indebted to Goldstein in the sum named in the note, less the [298]