Robertson v. Hartman

THE COURT. In this action to quiet title to certain lands in San Mateo County, the plaintiffs had judgment and the defendants appealed.

The common source of the titles claimed by the parties is the Capuchino Golf Corporation, which acquired a tract of land for the purpose of laying out a golf course and subdividing and selling the land adjacent thereto for residential purposes. The corporation engaged the defendant Stansbury Contracting Company to make extensive improvements on the property, for which it became indebted to the contracting company in a large sum for materials and labor, and for money advanced. The contracting company was demanding payment, whereupon the golf corporation agreed to execute promissory notes aggregating $102,626.88, and, as security therefor, a second trust deed on its interest in said property. On May 26, 1928, the president of the golf corporation issued a call for a special meeting of its board of directors, to be held on May 31st at 10 o’clock A. M. at the office of the corporation, and certified that on said 26th day of May he had served a true copy of the call on ‘1 each of the directors of the Capuchino Golf Corporation”. On May 31st three directors, of the golf corporation met at the time and place appointed and adopted a resolution authorizing the corporation to execute said notes and trust deed. Under date of June 1, 1928, the corporation, by its president and secretary, with the corporate seal attached, executed the notes and the trust deed. These instruments were delivered to the contracting company, accompanied by a copy of a resolution of the board of directors of the golf corporation, certified by its secretary to be a correct copy and to have been “unanimously carried” by said board, authorizing the execution and delivery of said notes and trust deed to the contracting company. The trust deed was recorded on June 4, 1928.

Default in the payment of the notes was duly declared by the assignee of the contracting company, the defendant E. A. Hartman, and under proceedings admittedly regular, the trustee sold said land and executed its deed conveying title to said assignee as the purchaser.

Under date of September 24, 1928, the golf corporation executed and delivered a deed conveying to the plaintiffs herein eight lots. These lots were included in the property [411]covered by the trust deed to the contracting company. The plaintiffs claim through that deed, recorded on November 1, 1928, which was about five months after the trust deed was recorded. They commenced this action on June 12, 1930, which was subsequent to the trustee’s deed to Hartman.