The record-union., 1891-02-08

r.,
were entitled to reduction of the interest
on the principal to ten per, cent. per an
mum for. the first year only; that the
plaintiff had paid all State, county and
municipal taxes assessed against the
mortgage; that no part of the principal
sum nor of the interest thereon mem
TONED in the note and mortgage had been
elected, or exercised his option, to con-
slider the principal and interest of the note
due was given by plaintiff to defendants
or either of them, prior to the commence
ment OF the action, and that no demand
was made by plaintiff upon defendants
for the payment of the whole sum of
principal and interest other than by
bringing the suit; that the sum of three
hundred dollars is such reasonable attor-
ney's fee as is provided in the note and
mortgage; and that at the time of the trial,
December 81, 1889, the amount of prin-
clpal and interest due and unpaid on the
note was So, 149 60.
entered, adjudging that there be paid to
the plaintiff from the proceeds of the sale
OF the property the amount found due,
and $500 for attorneys fee, and costs of suit.
The defendants moved for new trial,
which was denied, and have appealed
from the Judgment and order.
l. The appellants contend that it was
mencing his action, to give them notice
that he had exercised his option to treat
the whole sum of principal and interest
as due, and to make demand for the pay
ment of the whole sum, and also that, by
his delay to commence the action for
nearly three months after the first INSTALL
ment OF interest became due, he waived
the right to exercise such option.
The promise to pay the interest annu-
ally was absolute, and the first INSTALL
ment became due at the expiration of one
year after the date of the note. The stipu-
lation in the note that if the interest
should net be paid when due, then the
whole sum of principal and interest
should Immediately become due and pay
able, at the option OF the holder, was
without any conditions or limitations re-
curing notice or demand. The makers
knew of this provision, and their failure
to pay the interest when it became due
left IL wholly Optional with the holder to
insist upon the payment of the whole
debt or not as he might elect.
In Whitcher VS.. Webb, A Cal. l27,
where the note in suit contained a pro-
vision similar to that involved here, it
was held that failure to pay the interest
when 1t became due made the whole
amount of the note due absolutely, at the
option OF the holder, without any notice
from the holder to the payor. The court
said: The plaintiff had no duty to per-
form to the defendant, and the latter no
excuse to delay the payments which he
had stipulated to Inake.n In Dean VS.,
Applegarth, 65 Cal. 39l J, the note in suit
bore interest at the rate of one per cent.
per month, payable monthly in advance,
and il was stipulated that in case default
should be made in the payment of any
OF the interest when due, that such in
staliment or payment thus in default
should bear interest from the day of ma
turity until payment, at the rate of two
per cent, compromising monthly, and at
any time during such default the entire
unpaid balance of the principal sum
should, at the option of the holder Of the
note, and not otherwise, become due and
payable, and the principal sum so due
and payable should bear interest there
after at the rate OF two per cent. per
month, compromising monthly, until
paid. When the action was commenced
the note by its terms had become due,
and the question was as to what interest
the plaintiff was entitled TO recover. The
court said: This provision as to the COM
pounding of the interest on the principal
sum was only intended to have operation
when, after default in the payment of an
lnstallment OF interest," and before the
principal sum had matured, the plaintiff
elected to have the principal become due.
so that he might bring his action at once
to foreclose." 1t did not appear from any
ayerment in the complaint or otherwise
THAT any option was made or manifested
III any way by the plaintiff prior to the
commencement of the action, and it was
held that this option must have been ex-
ercised and manifested in some Way be-
fore 1t could have effect. The court then,
speaking of the ways in which the option
might have been manifested said, He
(the plaintiff) might have brought his
action to foreclose immediately on de-
fault, and this would have been a suf-
ficient election
ardson, II Cal. 345, the court said: s0Tbe
promise to pay the interest annually was
absolute. The only question left to the
option OF the holder was, whether upon
the failure to pay such interest, the whole
amount OF principal and interest should
immediately become due and payable.
without any act on the part of the holder
showing MS election to exercise the OBJ
ton given him. The case as presented
does not call for a decision of this ques-
ton, but we think the case of Whitcher VS..
Webb, A Cal. l27, determines it adverse
ly to the appellant"
AS to demand, the general and well
settled rule is that, in an action to recover
money, payable on demand, or at fixed
time, or on the happening of an event. it
is not necessary To show actual demand
before bringing suit. The institution of
the suit IS sufficient demand. iZiel VS..
Dukes, II Cal. 40; Halleck VS.. Moss, p
Cal 2B6; Luckhart VS.. Ogden, 80 Cal. $50;
Cummings vs.. Howard, 81 Cal. 5O3.)
In the light,of the foregoing authori-
ties, it is clear, we think, that the plain
tiff could maintain his action without
showing notice of his election or demand
OF payment prior to, or otherwise than
by, the institution of his suit.
In Crossmore VS.. Page, 70 Cal. 2lS, it
was held that an option given to the
holder, OF promissory note to have the
same become due Immediately upon de-
fault in the payment of the interest as
therein provided, in order to be available
as against an indorser, must be exercised
within reasonable time after default.
and that delay of seven months before
attempting to exercise the option was UNI
reasonable.
The delay in commencing this action
was, as we have seen, less than three
months after the default in paying interest,
and the circumstances connected with and
accounting for the delay are as follows:
The plaintiff testified that on or about
October 20, 1888, he met the defendant, G.
L. Dean, and that, ''Mr. Dean said to me
be wanted | should have this money, but
he said, have use for it, and if you can
just let me have few days, or something
like that, want it to pay for carload Of
material. l told him, Mr.. Dean, am
expecting it; / have counted on it, and
want the money, but I can get along for
few days. We was speaking about the
interest and that was a little before the
interest became due. wanted the
money, but | didn't propose to press
him." The defendant G. l.. Dean testi-
fled substantially to the same effect, but
fixed the time as about October 9th. He
stated that plaintiff told him he had use
for the money, but, under the circum-
stances he would extend the time to pay
the interest and would not push him.
The defendants also put in evidence let
ter, dated October II, 1855, which was