Farley v. Security-First National Bank

MARKS, J. This is an appeal from an order refusing to settle the final account and distribute the estate of James Henry Farley, deceased.

James Henry Farley died on April 7, 1929. At the time of his death he was indebted to Los Angeles-First National Trust & Savings Bank, now Security-First National Bank of Los Angeles, in the sum of $2,500, evidenced by a promissory note dated May 15, 1928, due in installments, with interest at 7 per cent per annum. The note was secured by a deed of trust on property in the city of Hanford.

Deceased’s will was admitted to probate and appellants were appointed and qualified as executors. Within the time fixed by law, respondent presented its claim in due form. It was allowed and approved by the executors and the probate judge and filed.

On March 20, 1931, the property was sold under the power of sale in the deed of trust for the sum of $2,000. The total amount of the indebtedness, due at that time, including interest and costs of sale, was $2,993.77.

On May 4, 1943, the executors filed their first and final account, report, and petition for distribution in which it was stated that the only claim against the estate was that of respondent and that it had not commenced an action to recover judgment for.a deficiency.

Respondent filed its objections setting up the foregoing facts and that $993.77, besides accrued interest, remained unpaid on its claim so that the estate was not in condition to be closed. After a trial the objections and exceptions were sustained. An order was entered refusing to settle the account and denying the petition, and this appeal followed.

The sole question presented is the necessity of recovering a judgment for a deficiency remaining after the sale of the security under a power of sale in a deed of trust given to secure a promissory note executed ■ prior to August 21, [132193]3, the effective date of sections 580a and 580b of the Code of Civil Procedure and section 2924% of the Civil Code. Insofar as material here, those sections have been held inapplicable to deeds of trust executed before their effective date. (Central Bank of Oakland v. Proctor, 5 Cal.2d 237 [54 P.2d 718]; Brown v. Ferdon, 5 Cal.2d 226 [54 P.2d 712]; Hales v. Snowden, 19 Cal.App.2d 366 [65 P.2d 847].)

The precise question, as well as others, was presented to this court in Estate of Thurnell, (Cal.App.) [19 P.2d 14]. We held that the claim, having been presented, allowed and approved in full, became an approved debt of the estate and there was no necessity of bringing any action against the estate for the unpaid portion of the debt remaining after the sale of the security under the power contained in the deed of trust. There were several other questions presented by the appeal. The Supreme Court granted a hearing but the appeal was dismissed so the cause was never decided.