Leslie V. Federal Finance Co

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FindLaw Caselaw California CA Ct. App. LESLIE v. FEDERAL FINANCE CO
LESLIE v. FEDERAL FINANCE CO

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Attorney
District Court of Appeal, Fourth District, California. Corporate Counsel
Academic
LESLIE et al. v. FEDERAL FINANCE CO., Inc.* Judicial Clerk
Summer Associate
Civ. 2180 Intern
Law Librarian
Decided: December 19, 1938
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Olson & Olson, of Los Angeles (Homer N. Boardman and Robert Clifton, both of Los Angeles, of
counsel), for appellant. Forgy , Reinhaus & Forgy (by A.M. Bradley ), of Santa Ana, for respondent. View More
About January 1 1 , 1 932, appellant, Catherine L. Leslie, and Charles C.L. Leslie, executed a deed of trust
upon certain real property in Orange county to the Orange County Title Company , as trustee, securing
among other obligations a note for $45,87 0 pay able to the respondent, Federal Finance Company , Inc.
The note and trust deed were in effect a renewal of a former note and trust deed between the same
parties inv olv ing the same property .
About September 1 8, 1 931 , one H.O. Jones obtained a judgment against the appellant's husband,
Charles C.L. Leslie. This judgment was recorded August 2, 1 932, in Orange county . The judgment
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Charles C.L. Leslie. This judgment was recorded August 2, 1 932, in Orange county . The judgment
creditor thereafter caused an execution to be lev ied upon and against all of the interest and estate of
Charles C.L. Leslie in and to the real property cov ered by the trust deed heretofore mentioned, which
execution was recorded September 7 , 1 932.
On or about December 1 9, 1 932, respondent caused its trust deed to be foreclosed and the real
property cov ered thereby sold by the trustee under the power of sale contained therein. At said sale,
which was held on July 25, 1 933, respondent corporation purchased the real property for the sum of
$56,000, and receiv ed a trustee's deed of the legal title thereto.
At the time of the trustee's sale appellant and her husband were the owners of certain tools, farm
implements and other equipment, of an alleged reasonable v alue of $1 0,000, which had been and were
being used in connection with the operation and maintenance of the real property , the legal title to
which appellant and her husband transferred to the respondent corporation by written assignment,
executed and deliv ered subsequent to the trustee's sale of July 25, 1 933, and prior to August 1 8, 1 934.
Plaintiffs herein brought this action, seeking to hav e the respondent corporation (1 ) declared a trustee
of the legal title to the real and personal property for their use and benefit; (2) reconv ey the property
to the appellant; (3) account for the proceeds deriv ed from the operation of the real property ; (4)
enjoined, pendente lite, from transferring or conv ey ing title to the property .
Appellant's claim to such relief, as set out in the complaint, is based upon certain oral agreements
between the parties to the trust deed and their conduct with respect thereto. Appellant alleges that
immediately prior to the trustee's sale, she and her husband had numerous conv ersations with one J.A.
George, as the activ e manager of the respondent corporation, and as a result of which an oral
agreement was made between the parties to the following effect:
(a) For the purpose of clearing the title to the real property in order that the respondent corporation's
trust deed loan might be refinanced, the respondent corporation would and should foreclose its trust
deed and cause the real property cov ered thereby to be sold.
(b) At said trust deed foreclosure sale of the real property , the respondent corporation would and
should become the purchaser thereof and that appellant and her said husband would and should
remain in possession and operation of the property until such time as they should be able to refinance
respondent corporation's said trust deed loan.
(c) For the purpose of protecting appellant's equity in the real property she and her husband would
and should make application to the Federal Land Bank of Berkeley , California, for a substantial loan.
(d) The proceeds of such loan to be made by said Federal Land Bank of Berkeley would and should be
receiv ed and accepted by the respondent corporation in reduction of appellant's said trust deed
indebtedness.
(e) The loan to be obtained from said Federal Land Bank of Berkeley would and should be secured by a
first mortgage on the real property described in the respondent corporation's said trust deed.
(f) After said trust deed foreclosure and the sale of said real property , the respondent corporation
would and should receiv e the proceeds deriv ed from the operation of said real property and account to
appellant and her said husband for all sums receiv ed in ex cess of the necessary operating expense.
(g) The net proceeds deriv ed and receiv ed by the respondent corporation from the operation of the
real property during the period in which title to the same was held by it would and should be applied to
the pay ment of appellant's trust deed indebtedness.
Subsequent to the trustee's sale of July 25, 1 933, and prior to July 1 8, 1 934, it is alleged that appellant
and her husband had certain conv ersations with J.A. George, as a result of which a further oral
agreement was made between the parties, to this effect:
(1 ) Appellant and her husband would and should transfer and conv ey to the respondent corporation
all tools, farm implements and other equipment used in the operation and maintenance of said real
property , under the same agreement which was then in force by and between the parties with respect
to the real property .
(2) The title to said personal property would and should be reconv ey ed to appellant and her husband
as and when the respondent corporation's said trust deed loan should be refinanced.
In the complaint it is further alleged in substance that on or about August 29, 1 933, appellant's
husband obtained a tentativ e commitment from the Federal Land Bank for a loan of $30,000, which
commitment the respondent rejected in January, 1 934. A similar commitment in the sum of $32,500
was rejected by it in May , 1 935.
Respondent corporation in its answer to the complaint specifically denies the allegations with respect
to the oral agreement heretofore mentioned and the conduct of the parties relating thereto.
Upon the trial of the case on June 8, 1 936, after the appellant and her husband had introduced their
proof, a motion for nonsuit was made and denied by the trial court. The parties thereupon stipulated to
the entry of an interlocutory judgment in accordance with a written stipulation, which was duly filed.
Thereupon judgment was made and entered by the court.
That portion of the interlocutory decree which we deem adv isable to relate, in fairly presenting the
agreement of the parties, may be recapitulated as follows:
1) The court on June 1 1 , 1 936, decreed that plaintiffs hav e the right to purchase the real property and
also the personal property theretofore described at any time on or before the 1 0th day of December,
1 936, for the sum of $57 ,821 .1 9, plus interest, cost of operation, etc. This sum was subject to an audit
by plaintiffs to be completed within 30 day s from the date of the decree. The net amount of the
purchase price was to be determined in accordance with an account furnished by plaintiffs as of June 3,
1 936.
2) It was further ordered that defendant corporation remain in possession of the real property until
plaintiffs paid to defendant the purchase price.
3) Upon payment being thus made the defendant was to ex ecute to the plaintiffs or their nominee, a
grant deed to the real property hereinbefore referred to, free and clear of all liens and encumbrances
made, done, or suffered by the defendant as of the date of the purchase by the defendant of said real
property at foreclosure sale of the deed of trust, but without cov enant or warranty , ex pressed or
implied, the defendant being only required to conv ey to the plaintiffs the title to the real property
which it acquired as purchaser under the foreclosure of the deed of trust.
4) That upon the purchase of the property by plaintiffs in accordance with the decree, and at the time
of the execution of the deed, the purchase price hav ing been paid to the defendant as therein directed,
defendant should also assign to the plaintiffs any moneys, due for crops grown on the land, and any
interest that it might then hav e in rev olv ing funds of marketing associations by reason of crops
marketed from the real property , and any interest that it might then hav e in sums to be paid by any
citrus marketing association by reason of unpaid balances for crops harv ested from the property . It
was ordered that at the time and under the conditions related defendant should further execute to
plaintiffs a bill of sale of the personal property remaining on the real property , but without warranty .
5) That all money to be paid to the defendant by the plaintiffs should be paid to its account at the office
of the Orange County Title Company in Santa Ana, to be paid by the title company to the defendant
upon receiv ing from the defendant the instruments required to be executed by the defendant under the
decree. The certificate of the title company that the money s had or had not been paid by the plaintiffs
or their assigns was to be sufficient ev idence to the court for the entry of the final decree therein. If,
howev er, the defendant should, upon notice of deposit of the money s with the title company , file with
the title company the instruments therein referred to, to be executed by the defendant on or before the
1 0th day of December, 1 936, and the money s were not receiv ed by the title company for the
unconditional use of the defendant as prov ided in the decree on or before the said date, then the court
should enter its final decree quieting title in the defendant corporation as thereinabov e prov ided.
(6) That if the pay ments to be made by the plaintiffs to the defendant for the purchase of the real
property were made as therein prov ided, and within the time therein limited, to wit, on or before the
1 0th day of December, 1 936, then the plaintiffs should be entitled to a final decree confirming title to
the real and personal property in the plaintiffs, and the court should, under such circumstances and
conditions, enter its final judgment confirming title to the real and personal property in the plaintiffs.
(7 ) That if plaintiffs failed to make the pay ments as therein prov ided to be made then immediately after
the time limit set by the interlocutory decree, to wit, the 1 1 th day of December, 1 936, the defendant
should be entitled to a final decree quieting title to the personal property in the defendant and
declaring that neither one of the plaintiffs is entitled to any right, title or interest in any of the real or
personal property , and the court should enter its final decree to that effect.
On June 1 1 , 1 936, appellant's husband, Charles C.L. Leslie, duly assigned to appellant all his right, title
and interest in and to the abov e-mentioned interlocutory decree and the rights thereby granted to
him.
On January 7 , 1 937 , the court gav e final judgment in fav or of the respondent corporation, quieting its
title to the real and personal property hereinbefore mentioned. This decree was made following a
hearing upon the motion of respondent corporation to enter a final decree. The motion to enter this
decree was filed December 1 2, 1 936.
From the ev idence presented at the hearing and the affidav its introduced it appears that the amount
necessary to be paid to respondent on December 1 0, 1 936, was the sum of $55,259.28. Counsel for
appellant filed an affidav it reciting the fact that he was attorney -in-fact for appellant; that on December
1 0, 1 936, he was in the office of the title company arranging for the deposit of the amount required to
be paid to the Federal Finance Company and for the purchase of the property by J. Roy Smith and wife,
as assignees and nominees of Catherine L. Leslie; that he was present on December 1 0, 1 936, when the
necessary funds were deposited with the title company in the exercise of plaintiffs' right to purchase
the property and that he directed the title company to pay out of such funds to the Federal Finance
Company , Inc., the sum of $55,259.28, upon receipt from the finance company of a deed of
conv ey ance of the real property to J. Roy Smith and wife, together with a bill of sale of the personal
property and assignments referred to in the interlocutory decree.
The escrow instructions dated December 1 0, 1 936, directed to the title company and giv en by
Catherine L. and Charles C.L. Leslie, through their attorney -in-fact, contained some of the following
prov isions:
I will direct the Federal Finance Company , Incorporated, a corporation, to conv ey to J. Roy Smith
and Grace Lee Smith, husband and wife, as joint tenants with the right of surv iv orship, cov ering that
certain property described as follows: (describing property ) upon pay ment to y ou for my account as
hereinafter prov ided, the sum of $68,000.00 of which amount $56,000.00 is deposited in escrow this
date and balance of $1 2,000.00 within 30 day s from date hereof, from which sum y ou may deduct
y our charges and adv ances and from which y ou may also pay all encumbrances on said property
necessary to issue y our Policy of Title Insurance in y our usual form, showing the record title to said
property v ested in said J. Roy Smith and Grace Lee Smith, husband and wife, as joint tenants with the
right of surv iv orship, free of all encumbrances. * All funds deposited in this escrow are to be disbursed
subject to the order of Culbert L. Olsen, attorney in fact for Cathering L. Leslie, at such time as these
instructions can be complied with. Y our liability under said policy of title insurance to be limited to
$68,000.00. *
Time is declared to be the essence of these instructions and if, within the time specified y ou are unable
to comply with these instructions, then all papers, money or property left with y ou by me shall be
returned to me on my written demand. *
These instructions were approv ed by J. Roy Smith and the $56,000 was authorized to be deposited in
the general escrow account. Smith signed an instrument agreeing to buy the property on the terms
abov e recited. On the same day the Leslies authorized the title company to pay from the funds
deposited by J. Roy Smith, to the finance company the sum of $55,259.28 upon the conv ey ance by the
finance company to J. Roy Smith and wife, of the real estate described and the execution of a bill of sale
of the personal property . This written instruction was not signed by J. Roy Smith.
It appears from the testimony of the v ice-president of the title company that on December 1 1 , 1 936,
respondent corporation's counsel tendered a deed, bill of sale, and certain assignments, and demanded
the $55,259.88 due under the decree. The title company refused pay ment and assigned as its reason
the fact that the escrow instructions called for an additional $1 2,000 to be paid by Smith and that the
deposit made was conditional upon securing clear title to the property . A title search would hav e to be
completed before a policy of insurance could issue as prov ided in the instructions. The title search was
commenced on the 1 1 th day of December, 1 936, and completed on December 1 8th of the same y ear, by
which it was disclosed that to clear the title a quitclaim deed would hav e to be obtained from E.E.
Pellegrin and dismissals filed in the declaratory relief suit and in the present action, as well as the
possible necessity of a release by respondent of a crop mortgage.
The affidav it of counsel for respondent which was receiv ed in ev idence relates in substance that on
December 1 1 , 1 936, at 9 o'clock a.m., he telephoned to the v ice-president of the Orange County Title
Company and asked if there was any money on deposit with that company which the company would
pay to the Federal Finance Company upon deliv ery by it to the title company of the instruments
required. The v ice-president replied that they had no money to pay it upon deliv ery of the instruments
but that he had taken in an escrow about 6 o'clock the ev ening before and $56,000 was deposited, but
that the money s could not and would not be paid to the finance company unless and until the title had
been searched and the title company could deliv er to the proposed purchaser its policy of title
insurance, insuring title in purchaser in accordance with the terms of the escrow, and that this would
take a number of day s; that counsel for respondent then stated that the Federal Finance Company
desired to make a tender of the instrument to the title company and was informed that it would be
useless because no pay ment would be made; that on December 1 1 , 1 936, a tender of the instruments
described in the decree was made and pay ment was refused; that he requested that he be shown the
escrow and was adv ised that he could not see it because the title company had been instructed by
counsel for appellant not to show the escrow nor to disclose its terms to the finance company ; that he
demanded that the title company issue its certificate in accordance with paragraph V II of the
interlocutory decree, stating that the money s had either been paid or not paid to the title company for
the account or unconditional use of the finance company ; that if they did not desire to certify to any
conclusion that they certify the true facts under which they held the escrow, including the escrow
instructions and terms. This demand was refused.
It is apparent from this statement that the respondent used the greatest diligence in making a tender,
and that if a tender was required, which we do not hold, it was useless, because respondent was
informed in adv ance that no pay ment would be made, ev en upon proper tender. Where a tender is
useless, failure to make it is ex cused. This principle is well established. Pierce v . Lukens, 1 44 Cal. 397 ,
7 7 P. 996; Civ .Code, secs. 1 440 and 1 51 5; Hulen v . Stuart, 1 91 Cal. 562, 21 7 P. 7 50; Bell v . Bank of
California, 1 53 Cal. 234, 94 P. 889. The court found that, though it was not required by the terms of the
interlocutory decree, the defendant tendered all instruments required by it to be tendered in the ev ent
the appellant desired to exercise the option. There is sufficient ev idence to support this finding.
It is contended that the trial court erred in sustaining respondent's objection when appellant offered in
ev idence, at the hearing on the motion to enter final judgment, a complaint entitled E.E. Pellegrin,
plaintiff, v . Charles C.L. Leslie, Catherine L. Leslie and Federal Finance Company , Inc., defendants,
wherein the plaintiff charges fraud and collusion between the defendants with respect to the sale of the
property under the trust deed, and alleges that he was the holder of a sheriff's deed under execution
sale upon a judgment formerly rendered in fav or of one H.O. Jones and against appellant's husband,
Charles C.L. Leslie. This was offered on the theory that respondent suffered the title to the property to
become clouded by its fraud and collusion. We are of the opinion that the court properly sustained the
objection.
In the case of Osborne v . Winter, 1 33 Cal.App. 664, 24 P.2d 892, the court, in defining the term suffer
to occur said [page 893]: It implies an approv al of or acquiescence in an act, and more than
nonresistance. Purinton v . Jamrock, 1 95 Mass. 1 87 , 80 N.E. 802, 1 8 L.R.A.(N.S.) 926. And denotes
knowledge and intention. Bunnell v . Commonwealth (Ky .) 99 S.W. 237 .
In Crist v . Fife, 41 Cal.App. 509, 1 83 P. 1 97 , construing section 1 1 1 3 of the Civ il Code, which declares
that a grant insures among other things that an estate is at the time of conv ey ance free from
incumbrances done, made or suffered by the grantor, the court said Suffered, as used in the statute,
implies reasonable control, and it cannot be held to apply to an incumbrance not caused by the act of
the party nor within his power to prev ent.
In Block v . Citizens' Trust & Sav ings Bank, 57 Cal.App. 51 8, 207 P. 51 0, it was held that condemnation
proceedings could not be said to constitute an incumbrance made, done or suffered by the v endor.
[Page 51 3.]
It cannot be said in the instant case that the mere filing of the complaint in the case of Pellegrin v . Leslie
et al., abov e referred to, by v irtue of which the title to the property may hav e become clouded,
constituted a lien or incumbrance made, done or suffered by the respondent, particularly when the
claimed act of respondent in transferring the property to J. Roy Smith was, as alleged in the complaint,
committed for the purpose of defrauding the judgment creditor of Charles C.L. Leslie. Under these
circumstances, appellant would be estopped in an equity proceeding from adv ancing such a claim,
especially where she was to receiv e all the benefits of such a fraud, if perpetrated, as alleged. Sec. 351 7 ,
Civ .Code. As a general rule, equity will not aid one party or another to a transaction which is illegal or
contrary to public policy , where they are equally at fault, but will leav e them just where it finds them,
to settle their questions without the aid of the court. Colby v . Title Ins. & Trust Company , 1 60 Cal. 632,
1 1 7 P. 91 3, 35 L.R.A., N.S., 81 3, Ann.Cas.1 91 3A. 51 5; 1 0 Cal.Jur. 51 8, sec. 57 . Respondent has
specifically denied all of the allegations of the complaint in this action. There is no finding supporting
the theory of fraud or collusion on the part of respondent and we cannot presume such fraud or
collusion from the record before us. Sec. 1 963, Code Civ .Proc. subd. 1 9.
It is to be noted further that after the introduction of the ev idence to which we hav e referred, and when
the court was about to announce its oral decision, appellant asked for a continuance for sev eral day s
for the purpose of securing further ev idence. Respondent objected to the continuance, but the
objection was ov erruled. On the day to which the hearing was continued, appellant called J. Roy Smith
as a witness and asked him if he was willing to change the escrow instructions so as to permit the
immediate release of the amount required to pay the Federal Finance Company so that the title
company might immediately pay ov er the money to the finance company on receipt from it of the
conv ey ances and assignments designated. He ex pressed a willingness so to do. A written authorization
to this effect was receiv ed in ev idence. Respondent refused to accept the offer, whereupon the court
rendered final judgment in fav or of respondent in accordance with the terms of the interlocutory
decree.
Appellant in his ex haustiv e and well-prepared brief strenuously contends that the decree or order
being interlocutory , the trial court had the power to ex tend the time therein prov ided for the payment
of the money by appellant to respondent, and cites the case of Los Angeles Auto Tractor Co. v .
Superior Court, 94 Cal.App. 433, 27 1 P. 363, which inv olv ed an interlocutory decree giv en by the
court after trial of the issues, and not one entered by stipulation of the parties. By that interlocutory
decree it was adjudged that the plaintiff's title to certain property be quieted against the claims of the
defendant Gladiator Manufacturing Company , unless, within thirty day s after entry of judgment the
company paid to a trustee for the plaintiff $1 5,500. It was prov ided that upon pay ment of said sum by
the company to the trustee within said period plaintiff should execute a deed to the company and
deliv er a certificate of title, and if the company did not pay within the thirty -day period then title
should be quieted against defendants by final decree. No pay ment was made and after the time had
expired to make a deposit plaintiff mov ed for final judgment. The motion was denied on a showing that
defendant would be able to comply within a short period of time. No compliance was had and sev eral
similar applications were made for final judgment and were, by the court, continued or denied. Plaintiff
sought a writ of mandate to compel the court to enter a final decree. The appellate court held that from
the language of the interlocutory decree the trial court did not intend that the interlocutory judgment
should of itself operate to complete the record of the action and that, therefore, it was subject to
amendment by the trial court in the exercise of its discretion. There are many other authorities cited to
the same effect. Gerrish v . Black, 1 09 Mass. 47 4; 21 Cor.Jur. 7 03; 1 0 R.C.L., sec. 350, p. 562; Kelley v .
Stanbery , 1 3 Ohio 408; Dieckhart v . Rutgers, 45 Mo. 1 32; Lawrence v . Staigg, 1 0 R.I. 581 ; Security
First Nat. Bank of Los Angeles v . Superior Court, 1 32 Cal.App. 683, 23 P.2d 1 055.
Respondent does not dispute this general rule, but contends that a different rule applies where the
interlocutory judgment is entered as a result of a stipulation and such stipulation specifically recites
the terms of and under which the consent judgment may be entered; that such interlocutory judgment
is then conclusiv e upon the consenting parties and cannot be amended or v aried without consent. This
principle of law receiv es support in the analogous case of Horning v . Kendrick, Saginaw Circuit Judge,
1 91 0, 1 61 Mich. 41 3, 1 26 N.W. 650. There the defendant was charged with hav ing purchased certain
lands as trustee for the complainant. He filed an answer but before proofs were taken the parties agreed
upon a settlement of the matters in dispute and a consent decree was entered, by the terms of which
the complainant was to pay to the defendant the sum of $6,000 on or before February 1 5, 1 91 0. Upon
the pay ment of this sum the defendant was to transfer the property in dispute to the complainant. In
default of the payment of the said sum on or before the said date, the property in dispute was to
become the property of the defendant. On February 1 5, 1 91 0, complainant filed a petition for an
ex tension of 60 day s in which to pay the $6,000. The additional time was allowed upon the ground
that the complainant had acted in good faith but had been disappointed in its efforts to raise money .
The defendant asked for a writ of mandamus to compel the elimination of an amended decree granting
the additional time.
The writ was denied upon the ground that the order ex tending the time of pay ment was a final order
and that a rev iew thereof could be had only by appeal. In deny ing the writ the court said [page 651 ]:
It is elementary that a decree by consent cannot, in the absence of fraud or mistake, be set aside by
rehearing, or on appeal; nor can it be modified without the consent of the parties. Russell v . White, 63
Mich. 409, 29 N.W. 865; Hodges v . McDuff, 7 6 Mich. 303, 43 N.W. 428; Enc. of Plea. & Prac. v ol. 1 8, p.
5, and cases cited. This proposition is not denied by the respondent; but it is urged that the amended
decree, which prov ides merely for an ex tension of time in which the money is to be paid, is not an
alteration of the decree.
We are unable to agree with this contention. * If the court below could ex tend the time once for a
month, it could again extend it for a further period, and thus render the decree less v aluable, or ev en
useless, to the party not consenting to the change.
It is apparent to us that the element of time was of the essence of the agreement, which ripened into a
decree. The court, in Horning v . Kendrick, supra, went on to say : Hav ing indicated our v iews upon the
merits, howev er, it is probable that a proper order will be entered by the learned circuit judge, upon
the application of relator, without necessitating the delay incident to an appeal.
See, also, Himmelmann v . Sulliv an, 40 Cal. 1 25; Faulkner v . Brooks, 1 25 Cal.App. 1 37 , 1 3 P.2d 7 48;
Schmidt v . Oregon Gold Mining Co., 28 Or. 9, 40 P. 406, 1 01 4, 52 Am.St.Rep. 7 59, 7 64; Estate of
Meredith, 27 5 Mich. 27 8, 266 N.W. 351 , 1 04 A.L.R. 348, 352; v ol. 3, Freeman on Judgments, sec.
1 352, p. 27 7 6; Hy de v . Superior Court, 28 R.I. 204, 66 A. 292. Where the decree contains a prov ision
retaining jurisdiction for the purpose of taking such other action as is necessary the court may , under
certain conditions, modify the terms of the decree. United States v . Swift & Co., 286 U.S. 1 06, 52 S.Ct.
460, 7 6 L.Ed. 999.
Respondent further argues that the terms of the interlocutory decree only amounted to an option to
purchase real property which appellant did not exercise and which option ceased with the passing of
time. Citing Brickell v . Atlas Assurance Co., Ltd., 1 0 Cal.App. 1 7 , 1 01 P. 1 6; Johnson v . Clark, 1 7 4 Cal.
582, 586, 1 63 P. 1 004; California Land Security Co. v . Ritchie, 40 Cal.App. 246, 255, 1 80 P. 625.
Considering the last points raised, if we accept the theory that the interlocutory decree amounted to a
consent judgment by stipulation and is therefore conclusiv e upon the consenting parties and cannot be
amended or v aried without consent, under the ev idence in this case the final judgment of the trial court
is sufficiently supported. If, on the other hand, we accept the appellant's contention that the
interlocutory decree is subject to modification to the ex tent requested, the only question then
presented is this: Did the trial court abuse its discretion in entering the final decree quieting title to the
property in respondent corporation, under the ev idence related, for failure of appellant to comply with
the terms of the option set forth in the interlocutory decree, on or before December 1 0, 1 936? We see
in the first place, that the deposit of the sum of $56,000 by Smith was accompanied by a number of
conditions, which were departures from the terms of the interlocutory decree.
The escrow instructions under which the sum of $56,000 was deposited on December 1 0, 1 936, by
Smith, prov ided that the property should be conv eyed to him upon pay ment by him of the sum of
$68,000, of which amount $56,000 was deposited on December 1 0, 1 936, and the balance of $1 2,000
was to be deposited by Smith within thirty day s.
The appellant in the instructions did not arrange for an unconditional pay ment on or before December
1 0, of the required sum, but prov ided for a conditional pay ment to be made if the conditions were met
within thirty day s from the ultimate date. It further appears that although the interlocutory decree
required that the pay ment be unconditional, there was the added condition that before pay ment be
made the title company should issue its policy of title insurance showing the record title to the
property to be in Smith and his wife, free of incumbrances. This requirement was made by appellant
and her husband although a sheriff's deed had been recorded showing an execution sale under a
judgment against Mr. Leslie. The title company was likewise giv en power, in the ev ent of any adv erse
claim, to refuse to comply with the demands of any one and to make no deliv eries to any person.
It is well established that time is of the essence of a contract of option, regardless of the words used.
Under any rule, howev er, it seems to us that the decree contained sufficient language to show that time
was an essential element. Paragraph XI of the decree prov ides that in the ev ent of a failure to make
pay ments, then immediately after the time limited by the decree, to wit, the 1 1 th day of December,
1 936, the defendant shall be entitled to a final decree. Williams v . Long, 1 39 Cal. 1 86, 1 89, 7 2 P. 91 1 ;
Bennett v . Hy de, 92 Cal. 1 31 , 1 34, 28 P. 1 04; Skookum Oil Co. v . Thomas, 1 62 Cal. 539, 542, 1 23 P. 363.
The ev idence, under either theory discussed, impels the ultimate conclusion that the trial court did not
err or abuse the discretion reposed in it by law.
Accordingly the judgment from which this appeal has been perfected, of necessity , must be and is
affirmed.
GRIFFIN, Justice.
We concur: BARNARD, P.J.; MARKS, J.
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Leslie V. Federal Finance Co

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FindLaw Caselaw California CA Ct. App. LESLIE v. FEDERAL FINANCE CO

LESLIE v. FEDERAL FINANCE CO

We concur: BARNARD, P.J.; MARKS, J.

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