The herald., 1896-05-16
A MATTER OF MORTGAGES
An Important Opinion Handed
Down by Judge York
POINTS OF LAW PASSED UPON
The Liability Of an Assuming Purchaser
Set Forth
The Intention Of the Parties. When Dlseov-
cred, Must Prevail In Constituting In.
struusents-Doubtful Contracts

Judge York of department three yes
| terday gave an opinion in the case of
| f. II. Ward VS.. Maria Antonio Monies
| de Oca ct al, which is of special interest
to moneylenders placing money on
mortgages. Several nice points of law
| are passed upon. Among others the
| liability of an assuming purchaser.
! The opinion is as follows:
On October %, 1889, defendant j. F.
| Humphreys was the owner of the real
| estate described in the mortgage sought
TO be foreclosed in this action: He was
! at that time, and had been for long
time prior thereto, the agent of plaintiff,
| in the loaning of moneys for plaintiff,
and on said day had moneys of plaintih
in his hands to loan. Desiring to bor-
row $4,000 of such moneys for his own
use said Humphreys, on that day, en-
tered into an agreement with defendant
Mathews by the terms of which he
agreed to convey said real estate to said
Mathews; and said Mathews agreed to
! make and deliver to said plaintiff two
promissory notes for $1,000 each and
certain mortgages upon said real estate
to secure the same; and that said Hum
phreys would hold said Mathews ire
sponsible for all damages; that he would
take it upon himself and be entirely
responsible" Said Mathews was to sign
said notes and execute said mortgages
phreys. After the making of said notes
and mortgages said Mathews was to
reconvey said real estate to said Hum
phreys. This contract was fully carried
out by the conveyance to said Mathews,
the making by her of the notes and mort
cages described in the complaint and the
reconveyance of said real estate by quit
claim deed to said Humphreys. In
said quit claim deed no mention is made
Of said mortgages or notes. on
June Sd: 1892. said Humphreys, by
real estate to defendant Maria
Antonio Monies de Oca in which deed
it was stipulated that said De Oca would
pay and discharge said mortgages. On
June IS, 1895, said De Oca conveyed said
real estate to defendant Vickery by
deed of grant which recited that said
Nickery took said property subject to
said mortgages which the grantee as
sumed and agreed to pay. The action is
prosecuted against all said parties and
the plaintiff seeks not only to foreclose
said mortgages and obtain an order of
sale of said mortgaged property, but also
to obtain a judgment over against all
said defendants. The contest is made
by De Oca and Vickery. The liability of
an assuming purchaser has been the
source of much contention in the courts
and the decisions are not harmonious
as to the nature and extent of such LA
bility. But the contracts by the grant
ees of the property covered by the mort
cages wherein they agree to take the
property subject to the mortgages and
pay the mortgages are subject to the
same rules of construction as other con-
tracts.
The intention of the parties when dis
covered must prevail. (Sec. 1886 c. c.
If these contracts were made expressly
for the benefit of Ward. Ward can en-
force them (Sec. 1853, c. c.
;rta of t11a nrtin &c n ha
ascertained by the writing alone, if pos
sible. (Sec 1859, c. c. 1t is not possible
in this case because of a latent ambig-
uity calling for the inspection of other
instruments.
In Tulare County Bank VS.. Madden,
(109 Cal. BAD it is held that the best
considered cases place the liability of
the subsequent grantee of the mort
gagged premises who has assumed the
payment of the debt upon the ground
that as between him and his grantor,
he becomes primarily liable for the pay
ment of the debt secured by the mort
gage, and his grantor becomes his
surety" In Hopkins VS.. Warner, G09
Cal. 1867 it is held that the right to
maintain an action against the aSsum-
ing purchaser Springs from the we'll
known rule in equity that a creditor
is entitled to the benefit of any obliga-
ton or securities given to his debtor by
one who has become a surety of such
debtor for the payment of the debt"
Under the statutory provision for the
foreclosure of mortgages in this state
there can be no personal liability up
on the mortgage debt except for de-
ficiency therein after the sale of the
mortgaged premises, and, hence, in the
latter case it is held that prior to such
sale the mortgagor will have no right
of action upon this agreement of his
grantee"
The conflicting authorities with ref
erence to the theory on which an assum-
ing purchasers liability is based need
not be reconciled or weighed in arriving
at a conclusion in this case. A discov-
cry of the mutual intention of the par
ties to the contracts can be aScertained
without reference to the technical dis
cussions carried on in many jurisdic-
tons with acknowledged learning and
ability and covering many years of
time.
The contracts under consideration, in
terms, accept conveyances to the mort
gagged premises subject to the mort
cages, which the grantees assume and
agree to pay. What mortgages? BY
reference we ascertain that they are
mortgages made by defendant Mathews
TO plaintiff to secure certain notes made
by Mathews and payable to plaintiff.
Standing alone. paying the mort
cages" without the light Of surrounding
circumstances, on proper, liberal con-
struction would mean paying the notes
secured by the mortgages, or the mort
gage Indebtedness. But in constituting
written instruments where any latent
ambiguity appears the rule is well es-
tablished that the surrounding circum-
stances should be considered. After
ascertaining the relation of the con-
tracing parties to each other, and the
subject matter of the contract, the court
will. if possible, SO construe the instru-
ment, however inartificially drawn, as
to give effect to the intention of the par
ties, providing 1t can be done Withou:
disregarding the language of the in
strument when all it's parts are consid-
cred" Thompson VS.. Mckay. Al Cal, |
22S
The sole object to be attained in the |
construction of contracts is to ascertain |
the real intention of the parties |
Sprague VS.. Edwards, as Cal, 249.
The facts known to both contracting |
parties are the only facts which assist |
in interpreting a doubtful contract be- |
cause the intention to be ascertained |
is the mutual intention and not the in |
tention of one party, based upon circum-
stances, knowledge of the existence |
of which he knew the other party did |
not possess.
The facts here. known to both parties, |
were the execution of the notes and !
mortgages by defendant Mathews, and |
the subsequent conveyance of the mort |
gagged premises from Mathews to de- |
feudent Humphreys by quit claim deed. |
which made no mention of the notes or |
mort cages. Humphreys was therefore |