Keene Guar. Sav. Bank v. Lawrence

• Decision Date: 08 September 1903
• Citation: 73 P. 680,32 Wash. 572
• Parties: KEENE GUARANTY SAV. BANK v. LAWRENCE. LAWRENCE v. KEENE GUARANTY SAV. BANK (two cases.
• Court: Washington Supreme Court

73 P. 680

32 Wash. 572

KEENE GUARANTY SAV. BANK v. LAWRENCE.

LAWRENCE v. KEENE GUARANTY SAV. BANK (two cases.

Supreme Court of Washington

September 8, 1903

Appeal from Superior Court, Yakima County; Frank H. Rudkin, Judge.

Actions by the Keene Guaranty Savings Bank against Abram E. Lawrence and by said Lawrence against said bank, consolidated and tried as one. From the judgment rendered Lawrence appeals. Affirmed.

Whitson & Parker, for appellant.

Graves & Englehart and D. J. Crowley, for respondent.

PER CURIAM.

The Keene Guaranty Savings Bank brought an action against Abram E. Lawrence to foreclose a certain mortgage on lots in the city of North Yakima. Prior to the commencement of the foreclosure suit Lawrence had instituted an action to cancel the same mortgage as a cloud upon his title. The two actions were consolidated and tried as one, and from a judgment against Lawrence this appeal is prosecuted.

The premises in controversy were, in the year 1889, the property of James H. Thomas, and on July 13th of that year Thomas and wife executed their bond for a conveyance of the lots to one Cadwell, who assigned the bond to one Lloyd, by whom it was assigned to the First National Bank of North Yakima to secure Lloyd's notes to the bank for $3,000, $4,000, and $4,200 respectively; Cadwell's notes to Lloyd for like amounts and times of payment being also assigned to the bank as collateral security. Cadwell and Lloyd were partners in the purchase of the lots and the erection of a building thereon. At the time the loan was made Thomas and wife executed a deed to Cadwell for these lots, and the same was placed in escrow with the bank, to be delivered upon payment of the purchase price. The bank retained this deed, contract for conveyance, and the notes, but failed to put the assignment of the bond on record. On October 26, 1889, there was placed of record another deed from Thomas and wife to Cadwell for the same lots, dated back to July 3d of that year, but not acknowledged until September 11th, thus showing the legal title in Cadwell, without anything of record to indicate the bank's equitable lien. On the 16th day of December, 1889, Cadwell made a mortgage to the Mason Mortgage Loan Company for $10,000 upon these lots, the mortgage being acknowledged before Allen C. Mason as a notary public, he at the time being president of the mortgage company. The mortgage was filed for record December 23, 1889. The Mason Mortgage Loan Company, in its regular course of business, on receiving this mortgage, notified the Keene Guaranty Savings Bank at its office in Keene, N. H., that it had the same for sale; that it was a first mortgage and lien on the above-described property, and was a good investment. After some negotiations, the mortgage and notes were sold and assigned to the respondent on the 4th day of February, 1890 upon the payment of its full face value, and this assignment was filed for record in the auditor's office of Yakima county on February 8, 1890. On the 13th day of June, 1890 the First National Bank began an action against Cadwell and the Mason Mortgage Loan Company to set aside and cancel the mortgage, but did not make the Keene Guaranty Savings Bank a party. A decree was entered adjudging that the lien of the First National Bank, by reason of the bond assigned to it and deed in escrow as aforesaid, was prior to the lien of the mortgage to the extent of $8,037.85 on account of moneys advanced by the loan company after notice of the circumstances under which the bank claimed a lien, and directing a sale of the property to satisfy the bank's claim. Under this decree the lots were sold, and Abram E. Lawrence, the appellant here, became the purchaser, and now holds a sheriff's deed therefor. No decree was entered canceling the mortgage or in any way barring the rights of the respondent, the Keene Guaranty Savings Bank. The appellant also deraigns title under a mechanic's lien foreclosure. On the 4th day of September, 1889, Cadwell, acting for himself and Lloyd, made a contract with the firm of Whittier, Fuller & Co. to supply certain material for the construction of a building on the lots in controversy. On the 11th day of June, 1890, the said firm filed a claim of lien against the property, which was duly recorded in the county auditor's office, and on May 11, 1891, in a suit brought to foreclose said lien, recovered judgment against Cadwell and Lloyd for $2,936.60, and the property was sold thereunder to one Plummer, to whom in due course a sheriff's deed was issued, and the property was thereafter conveyed by him to appellant. The respondent was not made a party defendant in the suit for the enforcement of the mechanic's lien.

It is contended that the court erred in finding that the interest and title of appellant in the premises in controversy is subject and inferior to the...