Forte v. Nolfi

• Decision Date: 18 May 1972
• Citation: 102 Cal.Rptr. 455,25 Cal.App.3d 656
• Court: California Court of Appeals Court of Appeals
• Parties: Rheba FORTE and Callie Holt, Plaintiffs and Respondents, v. Adrian NOLFI et al., Defendants and Appellants. Civ. 28623.

Page 455

102 Cal.Rptr. 455

25 Cal.App.3d 656

Rheba FORTE and Callie Holt, Plaintiffs and Respondents, v. Adrian NOLFI et al., Defendants and Appellants.

Civ. 28623.

Court of Appeal, First District, Division 1, California.

May 18, 1972.

Rehearing Denied June 12, 1972.

Hearing Denied July 12, 1972.

James J. Duryea, Michael Lewton, John A. McGuinn, San Francisco, for plaintiffs and respondents.

Walcom & Harmon, San Francisco, for defendant and appellant Adrian Nolfi.

Henry Gross, San Francisco, for defendants and appellants Williams and Belli, dba Willbell Co. and the Keith Co.

SIMS, Associate Justice.

Defendant Nolfi, and defendants Williams and Belli, individually and doing business as the Willbell Company, and the Keith Company, a co-partnership consisting of Julian S. Davis and Audrey S. Davis, have separately appealed ¹ from a judgment which adjudged that a note and deed of trust allegedly executed by plaintiffs was null and void and of no legal effect and created no lien upon the property of plaintiffs, quieted plaintiffs' title as against said defendants, and awarded plaintiffs, as against all the defendants, jointly and severally, $17,900 damages, representing an award of $20,000 as the proximate result of the false, fraudulent, oppressive and malicious acts of the defendants, and each of them, less a credit of $2,100 which was found to be the reasonable value of the repairs actually performed by the defendant Nolfi.

The defendants contend that there is no evidence or testimony of any kind to support material findings of fact made by the trial court and the judgment predicated upon those findings. The defendants Williams et al., who may be collectively referred to as the financiers, specifically attack the findings that the plaintiffs signed the note and deed of trust without knowledge of the nature and legal significance of the documents (VIII), that all of the defendants conspired to falsely and fraudulently obtain plaintiffs' signatures on the note and deed of trust, and to assign the same for the purpose of depriving plaintiffs of any defenses they might be able to assert against defendant Nolfi, the original payee of the note (XIII), and that the plaintiffs were damaged in the sum of $20,000 (XVIII). Defendant Nolfi, the contractor, in a rambling brief apparently makes the same contentions and in addition complains of the failure of the court to find whether the original agreement for the work, which was allegedly financed by the note and deed of trust, was for a price of $2,700, inclusive or exclusive of financing charges, and of the sufficiency of a finding, related to finding VIII, above, to the effect that plaintiffs would not have signed the instruments had they known their true nature (X).

It is concluded the evidence is sufficient to sustain the finding that the defendant Nolfi secured the signatures of plaintiffs to the note and deed of trust by falsely and fraudulently concealing from and misrepresenting to plaintiffs the nature and legal significance of the documents; that the evidence fails to support the finding that the remaining defendants conspired with Nolfi to that end, although they did conspire with him to secure usurious compensation for the loan; that the evidence sustains the finding that the reasonable value of the work performed was $2,100 rather than the $2,700 contract price; that the damages properly assessed against Nolfi and improperly assessed against the remaining defendants for slander of title are excessive; and that in order to equitably dispose of the matter, the plaintiffs should be required to pay the value of the work accomplished, without interest, to the usurious lender in order to quiet the equitable lien created by the construction contract which plaintiffs acknowledgedly executed. The judgment must be reversed and the case must be remanded for further proceedings.

In December 1961 the property at 456 Silver Avenue in San Francisco was owned by plaintiffs Rheba Forte and Callie Holt in joint tenancy. It was encumbered by a deed of trust securing an indebtedness of $10,000, incurred when the property was in the sole name of plaintiff Forte so that she could make a down payment on the home in which she resided at the time of the events giving rise to this action. The plaintiff Holt is the aged and infirm mother of plaintiff Forte and took no part in the transactions except, as related by her daughter, to sign the proposal for work submitted by defendant Nolfi. Reference to plaintiff in the singular is to plaintiff Forte, who married Charles Hightower December 2, 1961, but used the name Forte in signing the proposal and in bringing this action because the property was of record in that name.

Plaintiff concededly had received notices from the urban redevelopment authority of the City and County of San Francisco listing numerous violations of various housing, electrical, plumbing and building codes. The building inspector put a sticker on the front of the building which stated that the property was uninhabitable, and subsequently in 1965 the city filed suit against the owners. The problem giving rise to the work involved in this case arose by virtue of the fact that heavy rains in the winter of 1961--62 caused a failure of the retaining wall and foundations at the southwest portion of the property. The city had at that time condemned the basement apartment. Plaintiff's husband contemplated doing the repair work himself, he purchased some materials and he submitted plans to the city but the authorities told him he would have to get an architect's plans. Although the plaintiffs never sought to get credit to effect the repairs, Hightower, at the request of a contractor, attempted to secure financing at a branch of the Bank of America and was unsuccessful.

Both Hightower and Nolfi agree that they met at the premises in December 1961, that plans were drawn for the work by an architect, that Nolfi gave an estimate of $2,700 for doing the work, and that the negotiations terminated with plaintiffs' signing of the contractor's proposal. According to Hightower, two meetings occurred when the contractor came by the premises while he was cleaning up debris from the collapse of the wall, and the plans for the work, which bear date of March 13, 1962, were prepared by the architect at his request. The contractor testified that he came to the premises as a result of a phone call received from Hightower and that he arranged for and paid for the architect's plans. He acknowledged that his practice was to advise the owner that plans were necessary and have the owner bear the cost.

Hightower, plaintiffs and Nolfi were present at the Hightowers' residence when the proposal submitted by Nolfi, and dated March 9, 1962, was signed by the plaintiffs. The evidence concerning the manner in which the plaintiffs' signatures were apparently affixed to the note in the sum of $3,450, and the deed of trust securing it, which are the subject of this action, is discussed below.

A typewritten promissory note dated March 6, 1962 ostensibly executed by plaintiffs with Nolfi as payee in the sum of $3,450 payable, with interest at 10 percent per annum in instalments of $40 per month, and secured by a deed of trust bearing the same date, ostensibly executed by the plaintiffs with Nolfi as the beneficiary, and Willbell Company, a partnership, as trustee were obtained by Nolfi. The deed of trust, and an assignment of the deed of trust dated March 12, 1962 from Nolfi to the Keith Company, a partnership, each bear acknowledgments executed by the same notary on March 16, 1962. On that day defendant Belli deposited $2,700 with a title company on behalf of the Keith Company, a partnership, the deed of trust and assignment were recorded, and the $2,700 was disbursed as follows: for title insurance $45, recording fee $4.80, and notary fees of $3, leaving a balance of $2,647.20 which was paid to Nolfi.

Further evidence bearing on the part played by the defendant financiers in the foregoing transactions is reviewed under the discussion of the finding on conspiracy, and the evidence bearing on the performance of the work then undertaken by defendant contractor is discussed in connection with the finding on damages.

Defendant Williams testified that on March 20, 1962 he wrote a letter to plaintiffs at the Silver Avenue address transmitting a payment book of a type issued by the title company which handled the above transaction, and that such books as he sent customarily bore a sticker setting forth his name and address which obliterated similar information relating to the title company. Defendant Nolfi had never seen the payment book. Defendant Belli was familiar with the fact that the title company gave the payment book to brokers, but stated that Williams handled all collections through his office, and he did not know whether or not one had been sent to plaintiffs.

The book bears a sticker with the names of plaintiffs and the Silver Avenue address, but no sticker obliterating the title company's name and address. Its cover refers to a note dated '3/6/62' in the amount of '$3450.00' for a term of '3 yrs.' with interest at '10%' calling for monthly payments of '$40.00.' The inside indicates that the note was due '4--1--65' and again shows the principal amount, the note of interest and the amount of monthly payments. It reflects a payment of $80 under date of August 29, 1962. Of this sum $57.50 was credited to the payment of interest through May 6, 1962, $8 to 'L.C.' (late charge?), and $14.50 on account of interest due to June 6, 1962.

Plaintiff acknowledged that she received the payment book which was produced in court. She stated that her husband had found it in the mailbox at 456 Silver Avenue. Although she first affirmed that it had been received in the mail, subsequently she testified that it had been just dropped in the box without letter or envelope. She specifically denied...