Hylton v. Badgley

WARNE, J. pro tem.* Plaintiffs appeal from a judgment in favor of defendants in an action brought to recover an alleged balance due on a promissory note. In their complaint they allege that in 1949 defendants Clyde Badgley and Dora E. Badgley executed and delivered a certain promissory note to plaintiffs, and that a balance in the sum of $1,849.67 was still due on the note. It was further alleged that said note was secured by a deed of trust on the interest of defendants in certain real property in Tehama County, said interest being an undivided one-third interest of the defendant Clyde Badgley as partner in the partnership known as Fire Mountain [77]Lodge, consisting of the defendant Clyde Badgley, the plaintiff Hal T. Hylton, and one Chester E. Badgley, to which said partnership said real property belonged; that the security became valueless by reason of the sale of all the right, title and interest in and to said property to plaintiff Hal T. Hylton pursuant to the decree dissolving said partnership in Action Number 8695 filed in the Superior Court of Tehama County for dissolution of said partnership; and that said decree recited that said Hal T. Hylton would be entitled to full payment of the note.

Defendants, in their answer, allege that the decree provided that the plaintiffs should become entitled to full payment of said promissory note only out of the proceeds of the sale of the partnership assets as ordered by the court; that the note was given as a portion of the purchase price of the real property described in said trust deed; that said real property had been sold to satisfy said obligation; that all the rights of the parties, including the obligation on the promissory note, were determined and adjudicated in the action dissolving the partnership ; and that the final decree granting plaintiff Hal T. Hylton judgment against defendant Clyde Badgley for $47.35 is now res adjudicata. As an affirmative defense and by way of counterclaim, defendants ask $3,000 allegedly due them by the decree of the court which defendents claim had never been paid.

By these pleadings the issues were thus joined.

By stipulation the matter was tried by submission of testimony in the form of affidavits and the matters put in evidence in conformity with the terms of the pretrial conference order. The pretrial order does not include a statement of the matters agreed upon by respective counsel but does show that the interlocutory decree in the case of Hylton v. Badgley, Tehama Superior Court Number 8695, was received as plaintiffs’ Exhibit Number 1-A; that the final decree of dissolution in said case was received as plaintiffs’ Exhibit Number 1-B; and that the contract of sale dated June 27,1953, was received as plaintiffs’ Exhibit Number 2.