McDonald v. Huff
Before: Temple
Synopsis
Vendor and Vendee—Delivery of Deed.—A Mortgagor Agreed in writing to execute a deed to the mortgagee, and leave it in escrow, to be delivered upon default by him in paying an agreed sum less than the amount due, provided the mortgagee gave a receipt in full. The deed was accordingly left as an escrow. Default was made, but, before the mortgagee accepted the deed, the mortgagor demanded it back, and conveyed to another. Held that, as the mortgagee had not signed the agreement, and therefore could never have been compelled to accept the deed, the mortgagor was at liberty to withdraw it at any time before it was accepted; nor did the contract become an executed one from the mere fact that the mortgagee forbore suit upon the mortgage until it was barred by the statute of limitations.
Mortgage.—A Deed Left by a Mortgagor as an Escrow, to be delivered upon default in payment by him of a sum fixed upon in satisfaction of all indebtedness, does not become operative until default, and creates no lien on the land.
TEMPLE, J. In 1882, plaintiff had a judgment against the defendant Huff, and also held a note given by him, secured by a mortgage. He threatened to foreclose the mortgage, and finally agreed with Huff that Huff should convey to plaintiff the mortgaged premises, in consideration whereof the plaintiff would release Pluff from all the indebtedness. The agreement was reduced to writing, and is signed by Huff only. In it Huff recites his indebtedness of three thousand five hundred dollars on the mortgage and [861]six hundred dollars on the judgment, and then proceeds as follows: “And whereas, I am at present unable to pay said sums at present, in full, in cash, but am desirous to satisfy said demands; and whereas, the said John E. McDonald is willing that I should make to him a conveyance of the land described in said deed, and in consideration of said conveyance release and discharge me from all of said indebtedness, and from all indebtedness due and owing from me to him; and whereas, the said John E. McDonald is also willing that I should retain said land, and that said deed of conveyance be held in escrow by B. H. McDonald, of the Pacific Bank, of San Francisco, Cal., until November 21, 1882, and that in case I pay to said John E. McDonald on or before said November 21, 1882, the sum of three thousand and eighty ($3,080) dollars, then the said deed is to be redelivered to me, and the said John E. McDonald give me a receipt in full of all demands against me, and said deed to be of no force or effect, and convey no title to said John E. McDonald. Now, then, I direct that said B. H. McDonald, with whom said deed is deposited, hold the same in escrow until the 21st of November, 1882, and in case I pay to said John E. McDonald or any agent or assign of him, said sum of $3,080 on or before said November 21, 1882, then the said B. H. McDonald redeliver and return to me said deed. And in case I fail to make payment to said John E. McDonald, or his agents or assigns, of said sum of $3,080 on or before November 21, 1882, then the said B. H. McDonald is hereby authorized to deliver to said John E. McDonald the said deed of conveyance on the said John E. McDonald executing to me a receipt in full of all demands against me by him and depositing the same with the said B. H. McDonald to be delivered to me by the said B. H. McDonald.” On the same day Huff executed the deed and deposited it with E. H. McDonald. McDonald executed no instrument in writing obligatory in himself to accept the deed and release the debt, nor did he bind himself not to bring suit to foreclose. In fact, however, he did not foreclose, but acquiesced in the agreement. Huff did not pay the three thousand and eighty dollars, or any portion of it, on the 21st of November, or at any time, nor did McDonald execute the receipt or demand his deed. The deed still remained with B. H. McDonald un
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