Lunt v. Boris

GOODELL, J. The respondents sued to establish their right to the possession of real property under the provisions [369]of a deed of trust after a default. The appellants filed a cross-complaint to quiet their title against the respondents and others. From a judgment awarding respondents possession and that appellants should take nothing by their cross-complaint this appeal was taken.

On January 2,1942, respondents were the owners of a piece of improved real property in Soledad,-160 feet by 290 feet in area, known as the Soledad Auto Court. It was subject to a deed of trust securing an indebtedness of $15,000 to the Salinas National Bank. It was subject also to a second mortgage or deed of trust securing an indebtedness of approximately $9,000 to one Pagels. On that day respondents conveyed the property to Palo Alto Building Company, pursuant to an earlier agreement, for the price of $28,000. No money payment was made or intended. The vendee took title subject to said $15,000 deed of trust and to said $9,000 second mortgage and executed a deed of trust to the vendors securing a promissory note for the remaining $13,000. By the earlier agreement the vendee had undertaken to assume, as part of the purchase price, certain outstanding obligations, but this undertaking became integrated in the $13,000 secured note just mentioned.

The last mentioned deed of trust from the vendee, Palo Alto Building Company, to the vendors, respondents herein, was dated January 2, 1942, and was given to secure said note for $13,000, due on January 2, 1943, bearing interest at 6 per cent per annum. This deed of trust covered the auto court property and included also two parcels of land wholly separate from the auto court and not involved herein. Up to the entry of judgment no payment on principal or interest had been made on the $13,000 note, hence there was clearly a default, as the court found.

The court found that the deed of trust just discussed provides that in case of “a default in the payment of any sums agreed to be paid by said note, then the plaintiffs could enter into and upon said property and take possession thereof, operate, manage and control said property and conduct any business thereon, and perform such acts as might be necessary or proper to conserve the value thereof, and collect and receive the income therefrom.” It was to establish and enforce this right to possession that this suit was brought. The prayer of the complaint asks for nothing beyond that except counsel fees.