Case Name: MARY HELENA LEDERER, Respondent, v. FRANCES MUIR, Appellant
Court: District Court of Appeal of the State of California
Jurisdiction: California
Decision Date: 1947-05-05
Citations: 79 Cal. App. 2d 478
Docket Number: Civ. No. 15638
Parties: MARY HELENA LEDERER, Respondent, v. FRANCES MUIR, Appellant.
Judges: 
Reporter: California Appellate Reports, Second Series
Volume: 79
Pages: 478–488

Head Matter:
[Civ. No. 15638.
Second Dist., Div. Two.
May 5, 1947.]
MARY HELENA LEDERER, Respondent, v. FRANCES MUIR, Appellant.
Ralph Sadler Rosen for Apellant.
Hy Schwartz for Respondent.

Opinion:
McCOMB, J.
From a judgment in favor of plaintiff after trial before the court without a jury in an action to recover the balance due on a promissory note, defendant appeals.
The essential facts are these:
Prior to February 3, 1945, defendant was the owner of a parcel of property known as 1438 San Ysidro Drive, Los Angeles. She engaged plaintiff, a real estate broker, to sell the property and agreed to pay a commission of $900. In early February, 1945, a sale of the property was consummated and the commission earned. Shortly thereafter plaintiff interested defendant in the purchase of a home at 2020 Coldwater Canyon Drive, Los Angeles. The owner of the property had agreed to pay to plaintiff upon the sale of the property a commission of $1,500. In order that defendant might finance the purchase of the Coldwater Canyon property plaintiff agreed to loan defendant $2,400, which sum con sisted of the $900 commission defendant owed plaintiff and the $1,500 commission plaintiff was to receive from the vendors of the Coldwater Canyon property. Thereafter defendant purchased the Coldwater Canyon Drive property. As evidence of the foregoing loan defendant signed the following note:
"L. & D. No......... $2400.00
Beverly Hills, Calif. February 14, 1945
"As per written agreement of even date, on demand, after date, for value received, the undersigned, jointly and severally promise (s) to pay to Mary Helena Lederer or assigns or order at its offices in Beverly Hills, Calif.
"The Sum of Twenty-four Hundred and no/100........ Dollars to bear no interest until date of demand—Thereafter interest at 6% per annum.
"Should the interest not be so paid, it shall thereafter bear like interest as the principal. Should default be made in the payment of any installment of interest when due, then the whole sum of principal and interest shall become immediately due and payable at the option of the holder of this note. The undersigned (jointly and severally) further promise (s) to pay all costs of collection, including attorney's fees, which may be incurred in the collection of this note or any portion thereof. In case suit is instituted for such purpose, the amount of such attorney's fees shall be such amount as the court shall adjudge reasonable. Principal and interest payable in lawful money of the United States of America. The makers, sureties, guarantors and endorsers of this note hereby consent to extension of time prior to, at or after maturity and hereby waive, diligence, protest, demand and notice of every kind. Should this note be signed by more than one person, firm or corporation, all of the obligations herein contained shall be considered the joint and several obligations of each signer hereof.
"This note is given as security and agreement to repay the sum of $2400.00 cash loaned to Frances Muir by Mary Helena Lederer.
(Signed) Frances Muir."
At the same time plaintiff and defendant signed the following agreement:
"It is hereby agreed that the $900.00 commissions due Mary Helena Lederer, as agent, from the sale of 1438 San Ysidro Drive and also the commission of $1,500.00 due Mary Helena Lederer from the sale of 2020 Cold Water Canyon Drive to Frances Muir, is hereby loaned to the undersigned, Frances Muir, for her purpose of purchasing the above mentioned 2020 Cold Water Canyon Drive property.
"To secure the above $2,400.00, the undersigned, Frances Muir, agrees to return said $2,400 from the sale of the vacant south portion of 2020 Cold Water Canyon property, running approximately 50 feet parallel to the Feldman property, for not less than $11,000.00 plus any cost of carrying charge, interest and escrow charges from date of close of escrow plus sales commission, if any.
"This loan and agreement is secured by note of even date herewith.
"Dated this 14th day of February, 1945.
(Signed) Frances Muir
" Mary Helena Lederer"
On September 19, 1945, plaintiff made written demand upon defendant for the payment of the foregoing note.
There are three questions presented for our determination:
First: Was the note above mentioned secured by a mortgage?
This question must be answered in the negative. A mortgage is a contract by which specific property is hypothecated for the performance of an act. (Civ. Code, § 2920.) In the present case the agreement executed by the parties did not fall within the foregoing definition of a mortgage. (See, also, Strickler Co. v. Eisner, 5 Cal.App.2d 441, 442 [42 P.2d 1065] ; Johnston v. Murphy, 36 Cal.App. 469, 470 [172 P. 616].)
In the most favorable view to defendant the agreement of the parties constituted a security for the payment of the note, which security did not constitute a mortgage; therefore plaintiff was entitled to waive the security and sue upon the note. (Civ. Code, § 3268; Martin Music Co. v. Robb, 115 Cal.App. 414, 419 et seq. [1 P.2d 1000].)
Second: Did the fact that the agreement between the parties provided that defendant was to repay the note from the money received from the sale of part of the property known as 2020 Coldwater Canyon Drive fix the time that the note was to be paid?
This question must likewise be answered in the negative. It appears clearly that the statement, "To secure the above $2400.00, the undersigned, Frances Muir, agrees to return said $2400.00 from the sale of the vacant south portion of 2020 Cold Water Canyon property," constituted merely a statement that any sum received from the sale of such property should constitute additional'security for the note which defendant had executed in plaintiff's favor and was not a part of the note which on its face stated it to be due on demand. Likewise the statement, "This loan and agreement is secured by note of even date herewith" appearing in the agreement was merely a layman's manner of expressing the fact that the loan was evidenced by a note of even date, it being obvious that the note could not be security for the agreement in a transaction of the nature of the one here involved.
Third: Did the trial court commit prejudicial error in failing to find that plaintiff was a duly licensed real estate broker at the time of the transaction mentioned in the complaint?
This question must also be answered in the negative. Section 10136 of the Business and Professions Code provides that an action cannot be maintained for the collection of a commission earned as a broker in the sale of real estate in the absence of an allegation and proof that plaintiff was a duly licensed real estate broker or real estate salesman at the time the alleged caused of action arose. It is evident that the present action is not one for the purpose of recovering a broker's commission for the sale of real estate, but to recover a sum of money loaned and evidenced by a promissory note. Hence the allegation in the complaint that plaintiff was a duly licensed real estate broker was an immaterial allegation, and the denial thereof merely created an immaterial issue; therefore under the established rule that a failure to find upon an immaterial issue does not constitute prejudicial error, defendant has failed to present a valid ground for reversal of the judgment. (Bacon v. Bacon, 21 Cal.App.2d 540, 546 [69 P.2d 884] ; Luitwieler v. Luitwieler, 71 Cal.App. 50, 58 [234 P- 329].) The appeal from the order denying the motion for a new trial is dismissed.
The judgment is affirmed.