Whitaker v. Hearnsberger, 16400

• Decision Date: 21 May 1951
• Docket Number: No. 16400,16400
• Citation: 233 P.2d 389,123 Colo. 545
• Parties: WHITAKER et al. v. HEARNSBERGER et al.
• Court: Colorado Supreme Court

Page 389

233 P.2d 389

123 Colo. 545

WHITAKER et al. v. HEARNSBERGER et al.

No. 16400.

Supreme Court of Colorado, en Banc.

May 21, 1951.

Rehearing Denied June 11, 1951.

Stevens Park Kinney, Denver, for plaintiffs in error.

William H. Scofield, Denver, for defendants in error.

STONE, Justice.

Plaintiffs in error Whitaker purchased a residence property from defendants in error Hearnsberger in October 1948 for $15,000, of which $12,000 was paid by their promissory note payable in monthly installments of not less than $90 each, including interest, due on the 5th day of each month. Narce Whitaker was a Colonel in the United States Army and the property was occupied by the Whitakers as a home. Having notice of their future transfer by the military authorities to the Philippine Islands, Whitakers listed the property for sale with Marguerite P. Hearnsberger, who was a licensed real-estate dealer, on July 9, 1949, but no prospective buyers were presented. Upon being transferred to the Philippines on September 24, 1949, Whitakers left no forwarding address but placed their interests in the hands of their attorney who here represents them. The attorney notified Mrs. Hearnsberger at once of that representation and on October 9, when her listing expired, he advised her that if no sale had then been made, he would let other realtors attempt to sell the property. Thereupon Hearnsbergers promptly sold their mortgage note, as they testified, at $1,000 discount and on small down payment to defendant Garnett, although they had been on the point of offering Whitakers $1,000 for their equity a few days before. Garnett immediately took the note to the attorney who here represents him, for foreclosure, although there had been no substantial default in any payment, except the last, and that was only fourteen days overdue. Upon notice sent to the last known place of residence of Whitakers, but without other attempt of notifying them or their attorney, the deed of trust was foreclosed in usual course by the public trustee. Under Rule 120 R.C.P.Colo., order was entered by the district court authorizing sale.

After learning of the pending foreclosure sale, Whitakers' attorney brought the present suit. In the complaint it is alleged in substance, inter alia, that Whitakers reside in the Philippine Islands; that they are the owners of the property in controversy; that they have made all payments as due on the deed of trust owned by Hearnsbergers; that payments due thereon for October and November had been mailed by them to Hearnsbergers from the Philippine Islands; that the purported assignment of the deed of trust from Hearnsbergers to Garnett was made without consideration for the sole purpose of foreclosure and with intent to defraud; that the parties defendant, except the public trustee, entered into a conspiracy to foreclose the deed of trust without knowledge of, or notice to, Whitakers, and withheld information from the court in filing the application for order authorizing foreclosure, with knowledge that the attorney for Whitakers was acting as agent for them, and that notice could or should have been given him and demand for payment made of him if payment had not been received; that Whitakers had been damaged by said conspiracy in the sum of $10,000; that said defendants had been guilty of reckless, wanton and willful disregard of the rights and safety of...