(126 Cal. 644)

WOLTERS et al. v. ROSSI et al. (S. F. 1,277.) (Supreme Court of California. Nov. 10, 1899.) VOLUNTARY DISMISSAL ACTIONS — CONSOLIDATION EFFECT-DEPOSITIONS-REVIEW OBJECTIONS CREDITORS' SUIT FRAUDULENT CONVEYANCES-HUSBAND AND WIFEEVIDENCE.

1. An order vacating an order of dismissal, unappealed from, operates to annul the entry in the clerk's register showing dismissal, as well as the judgment of dismissal.

2. The entry of an order of voluntary dismissal by the clerk of the trial court in the form of a final judgment of dismissal, as directed by an order of plaintiff's counsel, is not judgment of dismissal, and is unauthorized.

3. Where two actions were consolidated by an order reciting that the parties beneficially interested therein were the same, to which no exception was taken, it was error to exclude a deposition taken in one of them on the trial of the issues involved in the other.

4. An order consolidating actions which the court had jurisdiction to make is binding on all the parties to the actions until vacated or reversed.

5. Objections to the competency of a deposition, not made in the trial court, cannot be considered on appeal.

6. The right to maintain a creditors' suit to subject moneys, alleged to have been fraudulently transferred by a debtor to his wife, to the payment of a judgment against him, does not depend on the validity of a lien attempted to be created by garnishment in aid of execution before the commencement of the action.

7. Where a judgment debtor's insolvency was admitted by the pleadings, and the evidence proved that he transferred money to his wife without valuable consideration, after an order of examination in supplemental proceedings had been served on him, a finding that the transfer was not fraudulent was erroneous.

In bank. Reversed.

For opinion in department, see 57 Pac. 73.

HARRISON, J. The appellants recovered a judgment in the superior court against the respondent Charles Rossi, June 19, 1894, for the sum of $1,643 and costs, and thereafter, under proceedings supplementary to execution thereon, an examination of the judgment debtor and of his wife, Lena Rossi, was had before a referee appointed therefor by the court. At this examination it was shown that about the 28th day of February, 1895, the judgment debtor had given to his wife moneys amounting to $1,652.19, which he transferred to her from the Bank of Central California, and that on March 1st she had deposited this money with the Farmers' Bank of Fresno, and received from it therefor its certificate of deposit, negotiable in form and payable to her order. The order for the examination was made February 23d, and an examination was had on February 28th, and again on March 2d. After the examination upon the latter date, the referee made his report to the court; and thereupon the court made an order authorizing the plaintiffs to bring an action against said Lena Rossi for the recovery of said sum of $1,652.19, and at the same time prohibited and restrained her and the Farmers' Bank of Fresno from making any transfer or disposition of the money until its further order in the

premises. In pursuance of this order of the court, the present action was brought against Lena Rossi and her husband and the Farmers' Bank of Fresno. Rossi and his wife answered the complaint, claiming that the certificate of deposit and the money represented thereby was the property of Lena, and denying that it was the property of Charles, or subject to be applied upon the plaintiffs' judgment, and also alleging that immediately upon its issuance and delivery to Lena it had been transferred and delivered by her, and that they had neither of them any knowledge whatever as to its ownership or possession. No answer to the complaint appears to have been made by the bank. July 11, 1895, William Rigby, Jr., commenced an action against the Farmers' Bank of Fresno to recover the amount of the above certificate of deposit, and alleged in his complaint its indorsement in blank by Lena Rossi, and delivery to one Scott, and subsequent indorsement by Scott to the order of M. Ehrman & Co., and by Ehrman & Co. to the order of Rigby, the latter indorsement being "without recourse." Upon motion of the defendant in this action, the court made an order, November 7, 1895, under which the bank deposited in court the moneys represented by the certificate of deposit, and directed that the plaintiffs in the action of Wolters against Rossi be substituted as defendants for and in the place of the bank, and discharging the bank from all liability to them for and on account of said certificate of deposit. The plaintiffs in the original action thereupon answered the complaint in Rigby's action. The action of Rigby against the substituted defendants was brought on for trial January 23, 1896, and when nearly completed was continued for further hearing until January 29th. January 27th Rigby filed with the clerk an order entitled, "W. Rigby, Jr., vs. Farmers' Bank of Fresno (a Corporation)," as follows: "The clerk of said court is hereby authorized and directed to dismiss the above-entitled action, and to enter in the judgment docket the said judgment of dismissal." Thereupon the clerk made the following entry in his register: "In accordance with dismissal filed herein by counsel for plaintiff, I, T. G. Hart, clerk of said superior court, do hereby order, adjudge, and decree that said action be, and the same is hereby, dismissed." A document containing the same language was also indorsed, "Filed January 27, 1896. T. G. Hart, Clerk, by E. T. Wolcott, Deputy Clerk." Afterwards the substituted defendants moved the court to set aside and vacate this dismissal, and, after hearing the proofs upon this motion, the court made an order, March 23d, vacating and setting the same aside. March 25th these substituted defendants moved the court that this action be consolidated with the one brought by them against Rossi et al., and at the same time Rigby made a cross motion for the dismissal of his action. The motions were heard together, and on March 28th the court made an order in which, after reciting that it "finds the facts to be that the

parties to, and beneficially interested in, the above-entitled action, are one and the same, and might have been joined," it denied the motion of Rigby to dismiss his action, and ordered that the motion of Wolters and others to consolidate said actions "be, and the same is hereby, granted, and said actions are accordingly hereby consolidated." The actions thus consolidated came on for trial May 17th, at which time Rigby objected to any further hearing or proceeding in the case brought by him, "for the reason that the case has been, at the request of the plaintiff, by written stipulation and order of the clerk, dismissed," and objected to the court taking any further proceedings in the case, of any kind, character, or description. The court sustained this objection, to which ruling the substituted defendants excepted, and thereupon the court proceeded to the hearing of the case of Wolters against Rossi and others. Upon the conclusion of the trial the court found that the certificate of deposit, from the date of its issue and delivery until the commencement of the action, was not in the possession or control of the defendant Lena Rossi, or her husband, or either of them, and that the ownership had been transferred to other persons, and that at the time the action was commenced it was outstanding, duly indorsed by the defendant Lena. Judgment was thereupon rendered in favor of the defendants, from which, and an order denying a new trial, the plaintiffs have appealed.

1. The action of the court in sustaining the objection of Rigby to any further hearing or proceeding in the case in which he was plaintiff was erroneous, and the ground upon which he placed his motion therefor was untenable. Whatever effect the act of the clerk upon Rigby's order for the dismissal might have had upon the action, if no order had been made in reference thereto, it was completely annulled by the subsequent order of the court vacating it. The action was still pending in the court (Code Civ. Proc. § 1049), and, even if a judgment had been entered upon the plaintiffs' order, the court had jurisdiction to entertain the motion of the defendant, and to make an order setting aside the order of the clerk. "Such an order, however erroneous, is not void. It is an order after judgment, is made in the exercise of the general jurisdiction of the court, and, if not appealed from, the order operates permanently to vacate and annul the entry in the clerk's register as well as the judgment." Page v. Superior Court, 76 Cal. 375, 18 Pac. 385. In Page v. Page, 77 Cal. 83, 19 Pac. 183. it was said: "The dismissal is not complete, in the sense that the control of the court over the cause is terminated, until the judgment is entered." In that case, as in this, there had been an entry of dismissal in the clerk's register, but no judgment had been entered thereon. The only entry of dismissal herein is that made by the clerk in his register, which was also filed by him on the same day. The clerk had no authority to "order, adjudge, and decree

that said action be, and the same is hereby, dismissed," and this entry by Lim in his register was not an entry of judgment. The "register" is what its name purports,-"a book in which the clerk is to enter the title of the action, with brief notes under it, from time to time, of all papers filed and proceedings had therein" (Code Civ. Proc. § 1052); but judgments must be entered in the "judgment book" (Code Civ. Proc. § 668). The judgment to be entered upon the order of dismissal is a judgment of the court, although it is to be entered by the clerk.

In the present case the parties appeared before the court at the hearing of the motion, and upon the evidence offered in its support the court made an order vacating the dismissal. No appeal was taken from this order, but two days afterwards Rigby, in apparent recognition of its force, moved in open court for an order to dismiss his action, and the court, after a hearing thereon, made a further order denying his motion. When the cause came on for trial, and Rigby made the above objection, both of these orders were in full force, and the defendants were entitled to a trial and determination of the issues presented in the case. The court, therefore, erred in refusing to proceed with such trial.

This error was made the basis of another error at a subsequent stage of the proceedings. At the same time that the court denied the motion of Rigby for a dismissal of his action it made an order, as before stated, consolidating that action with the action brought by the appellants herein against Rossi and others. Upon the trial the appellants offered in evidence a deposition of Rigby, and also one of Ehrman, to which objection was made on the ground that they were taken in the action brought by Rigby, and not in the action brought by the appellants. Upon this objection the court excluded the deposition. The materiality of the evidence therein is not questioned. since it tended to sustain the allegation of the appellants that the certificate of deposit in question was at all times under the control of the defendant Lena. The order consolidating the actions had, however, the effect to destroy the force of the above objection, and the court should have received the depositions in evidence. By making this order, the court determined that the actions were "upon causes of action which might have been joined" (Code Civ. Proc. § 1048), and after the consolidation had been made it was immaterial in which action the depositions had been originally taken. In the order itself the court "finds the facts to be that the parties to, and beneficially interested in, the above-entitled action, are one and the same, and might have been joined." Whether the court was justified in making this order, or whether it erred therein, could not be considered at the trial of the action, nor is the question open to review here. The order was one which the court had jurisdiction to

make. and, until it was vacated or set aside, was binding upon all the parties to the two actions. No exception was taken to it, nor was any motion made to set it aside, and the court should have recognized its effect, and admitted the depositions when offered.

The objections made by the respondents in their brief herein, that there was no preliminary proof of the facts entitling the depositions to be received instead of oral testimony of the witnesses, and that no opportunity had been given to the Rossis to crossexamine the witnesses, were not made before the superior court, and are not before us for consideration. If in fact the parties to, and beneficially interested in, the actions are one and the same, as found by the court in its order, this objection was without merit. See Briggs v. Briggs, 80 Cal. 253, 22 Pac. 334.

2. February 28, 1895, the plaintiffs caused a second execution to be issued upon their judgment against Rossi, and on March 2d, by virtue of this writ, all the money then belonging to Charles Rossi in the possession or under the control of the Farmers' Bank of Fresno was attached under process of garnishment. It is urged by the respondents that, as the court found that at the time of the service of this garnishment upon the bank the certificate of deposit was not in the possession or under the control of the defendant Lena, but had been indorsed by her and was outstanding, and the ownership thereof had been transferred to other persons, the plaintiffs acquired no lien upon the moneys represented thereby. This finding, however, is made without reference to the evidence contained in the depositions which were excluded. Such excluded evidence would tend to show that the certificate was under the control of the defendant Lena at all times prior to the commencement of the plaintiffs' action, and we cannot assume what the finding of the court would have been had this evidence been admitted. There is, moreover, an uncertainty in the findings of the court upon this point. In paragraph 10 of the complaint, it is alleged that the certificate of deposit from the date of its issue and delivery until the commencement of this action was in the possession and control of the defendants Lena and Charles, and the ownership thereof not transferred by them, or either of them. to any other person. The court finds that all the allegations contained in paragraph 10 of the complaint are true, but it also finds directly contrary to the above allegation in this paragraph. The plaintiffs' action is in the nature of a creditors' bill, for the purpose of subjecting the moneys claimed to have been given by their judgment debtor to his wife, in fraud of his creditors, to the payment of their judg ment, and their right of action does not depend upon the validity of a lien created by the above garnishment. Moreover, any objection to the validity of the lien created by the garnishment of this money in the possession of the bank would more naturally come from the bank than from the payee of the cer59 P.-10

tificate, especially in view of the allegation in her answer that the certificate was, immediately upon its issue and delivery to her, transferred and delivered by her, and that she has no knowledge whatever as to its ownership or possession. The bank, however, has paid the money into court, and an order has been made discharging it from all liability thereon to the holder of the certificate or to the appellants herein.

3. The finding of the court that the transfer of the money to Lena from her husband was not in fraud of the rights of any of his creditors, or with any intent on the part of Charles to hinder, delay, or defraud any of his creditors, was not justified by the evidence. The allegations in the complaint of the insolvency of Charles, and of his indebtedness to the plaintiffs at the time of this transfer, were not denied in the answer. The complaint also alleged that the money was voluntarily given by Charles to his wife, Lena, "without any consideration, legal and valid, as against his creditors, but as a gift pure and simple." In their answer the defendants deny "that the money represented by said certificate of deposit was given by said C. Rossi for a valuable consideration to said Lena Rossi, and deny that said money was in any manner given by the said C. Rossi to the said Lena Rossi without any consideration therefor, or as a gift pure and simple, or otherwise." The court finds "that the money represented by said certificate of deposit was transferred and given to Lena Rossi by C. Rossi," but does not find the consideration upon which the transfer was made, or whether it was made upon any consideration, or was voluntary. The denial of the defendants that the transfer was for a "valuable" consideration, coupled with their denial that the money was given "without any consideration," left the court at liberty to find that there was a valid consideration for the transfer. The testimony did not authorize the court to find that the money was given by the husband to the wife upon any other consideration than that of his love and affection for her, and this testimony, taken with the admission of insolvency and indebtedness, was insufficient to authorize the court to find that the transfer was without any intent to defraud his creditors. The declaration in section 3442, Civ. Code, that the question of fraudulent intent is one of fact, and not of law, is subordinate to the rule that a finding of the fact must be supported by the testimony in the case; and the further provision in the section, as it stood at that time, that the transfer cannot be adjudged fraudulent solely on the ground that it was not made for a valuable consideration, is a negative, rather than a positive, provision. It has never been held in this state under this provision that a fraudulent intent should not be inferred from the absence of a valuable consideration, when coupled with other circumstances suggestive of fraud. In Judson v. Lyford, 84 Cal. 505, 24 Pac. 286, it appeared that, while the gran

tor was heavily indebted to the plaintiff, he made a voluntary conveyance of his property for the benefit of his children, and that he had at that time no other property. The superior court found that there was no fraudulent intent, but this court reversed that finding upon the ground that, under these facts, the inference was irresistible that he intended to place the property beyond the reach of the plaintiff's judgment. This case was referred to in Windhaus v. Bootz, 92 Cal. 617, 28 Pac. 557, and was distinguished from that upon the ground that "two all-controlling facts" appeared therein, viz. "defendant conveyed away all his property, and at the same time was practically insolvent." In Bull v. Bray, 89 Cal. 286, 26 Pac. 873, 13 L. R. A. 576, the superior court found that at the time of the conveyance Bray was ignorant of the fact that he was insolvent, but made no finding upon the question of intent, and for this reason granted a new trial. This order was affirmed here upon the ground that there was no irresistible inference that his intent was fraudulent under the finding that he did not know that he was insolvent at the time he made the conveyance. When the same transaction again came before the court in Knox v. Moses, 104 Cal. 502, 38 Pac. 318, the circumstances attending the transaction were held to fully support the finding of a want of fraudulent intent.

In view of these admissions in the pleadings and findings of the court, and the further showing that the transfer was made after the order of examination had been served upon the judgment debtor, it must be held that the inference is irresistible that the transfer to Lena was with the intent to hinder and delay the plaintiffs in the collection of their judgment. The judgment and order denying a new trial are reversed.

We concur: HENSHAW, J.; McFARLAND, J.; GAROUTTE, J.; VAN DYKE, J.; TEMPLE, J.

(126 Cal. 657)

STANTON v. SINGLETON et al. (L. A. 406.)1 (Supreme Court of California. Nov. 10, 1899.) OPTION-SPECIFIC PERFORMANCE - MUTUALITY OF REMEDY-UNCERTAINTY-CONTINUED SUPERVISION-THIRD PARTY'S RIGHTS.

1. Defendants, owning, with another, certain mines, agreed that plaintiff should have 30 days' option on a half interest therein; that the option should be void if plaintiff should fail to exercise it within the time, and, in case he accepted, he should spend $10,000 in opening or developing the properties and in building a stamp quartz mill, and should have the right to form as many corporations as he should deem proper, the profits from stock of which or money received to be equally divided between the par ties; that, if plaintiff should fail to begin active operations within 30 days, the contract should be void, and, in case plaintiff failed to fully carry out the contract, all money expended by him should be forfeited, and the properties returned to defendants. Within 30 days plaintiff spent $2,000 on said properties, and notified defendants that he elected to carry out said contract, but defendants refused to allow him to do so, Rehearing denied December 8, 1899.

and refused to perform their portion of the contract. Held, that since plaintiff was not bound to do anything under the option, and hence specific performance could not be decreed against him, he was not entitled to specific performance against defendants, there being no mutuality of the remedy.

2. It being uncertain as to which of the properties was to be opened or developed, as to which the stamp mill was to be erected on, and the limit within which the $10,000 should be expended in developing mines or within which the mills should be erected, specific performance could not be decreed, for uncertainty of the contract.

3. Specific performance will not be decreed where it involves a continuous and long series of acts of supervision requiring special knowledge, skill, and repeated examinations and new directions.

4. Where each of three parties owns an undivided one-third interest in mining properties, and only two of them agree to convey a half interest in such mines to another, he cannot enforce spe cific performance, since that remedy would unwarrantably interfere with the rights of the third owner, not a party to the contract.

In bank. Appeal from superior court, Kern county.

Action by O. B. Stanton against John Singleton and another. From a judgment sustaining a demurrer to the complaint, plaintiff appeals. Affirmed.

Rothchild & Ach and J. W. Ahrens, for appellant. J. A. Haralson and Reddy, Campbell & Metson, for respondents.

MCFARLAND, J. The court below sustained a demurrer to the complaint, and gave judgment for defendants, and plaintiff appeals from the judgment.

The action is brought to compel the specific performance by the two defendants named of a certain alleged contract, a copy of which is annexed to the complaint, marked "Exhibit A," and made a part thereof. The contract is as follows: "Agreement made and entered into this 22d day of June, 1895, between John Singleton, F. M. Mooers, and C. A. Burcham, of Kern county, state of California, parties of the first part, and O. B. Stanton, of Bakersfield, state of California, party of the second part. Whereas, the parties of the first part are owners by location of a certain mineral tract located in the Summit mining district, Kern county, California, and designated and described as follows: [Here follows a description of the property, which consists of 13 different quartz and placer claims.] And being desirous of obtaining capital to work the same, hereby agree with party of second part that for and in consideration of one dollar in hand to them paid, the receipt of whichis hereby acknowledged, agree to give party of second part thirty days' option of a onehalf interest of the above-enumerated claims, now owned by them, in consideration of the party of the second part agreeing to spend— First, ten thousand dollars ($10,000.00) in opening and developing said property; second, in erecting a ten-stamp quartz mill, modern in every particular, the stamps to weigh not less than seven hundred pounds, or the

equivalent, as may be found the most desirous to work the ores. The parties of the first part hereby agree that, this contract having been entered into in good faith, any locations that they may make or cause to be made in the said district shall be made for the joint benefit of both parties. The party of the second part shall have the privilege to incorporate as many companies as he may deem fit: provided, always, that any money, stock, or other consideration that he may obtain as profit shall be divided equally between the parties hereto. The parties of the first part hereby agree that the party of the second part shall have the privilege any time within six months from the date of this instrument to purchase the aforesaid property for the sum of five hundred thousand dollars ($500,000.00). The essence of this contract being time, it is mutually agreed that, should the party of the second part not commence active operations within thirty days, this contract shall be null and void. The party of the second part hereby agrees that all stock delivered to parties of the first part shall be free and nonassessable, and, further, if he should fail to fully carry out this contract, that all moneys paid or expended by him shall be forfeited, and the full properties returned to the parties of the first part. [Signed] John Singleton, Party of the First Part. Frederick M. Mooers, Party of the First Part. O. B. Stanton, Party of the Second Part."

It will be observed that this contract, although purporting to be signed by the two respondents and C. A. Burcham, was not signed by the latter; and at the hearing in department (54 Pac. 587), while other points were briefly noticed by counsel for respondents, the stress of their argument was on the point that the contract was void because not signed by Burcham, and in the opinion of the court then rendered that point was alone considered. But at the hearing in bank, while that point was also urged, it was elaborately argued by counsel for respondents that, even if it be held that the contract was sufficiently executed without the signature of Burcham, still it was in its nature a contract which a court of equity will not decree to be specifically performed; and we think that this contention must be sustained. The action is based upon the contract, which was made a part of the complaint; and, of course, the meaning which appears on its face cannot be changed by any mere matter of averment in the pleading. There is one provision in the contract to the effect that the party of the second part shall have the privilege within six months "to purchase the aforesaid property" for $500,000, but whether the "aforesaid property" means the whole of the mining property described or only an undivided half thereof, we do not understand that this clause of the contract is particularly involved in this action. The contract gives to the appellant "thirty days' option of a one-half interest of the above-enumerated claims" upon the consideration-First, that he

shall spend $10,000 in opening and developing the property; and, second, shall erect a 10stamp quartz mill, "modern in every particular, the stamps to weigh not less than seven hundred pounds, or the equivalent, as may be found the most desirous to work the ores." If this means anything it means that he should have 30 days in which to determine whether he would spend the $10,000 and erect a mill, and thereby become entitled to an undivided one-half of the property. It is averred in the complaint that appellant notified the respondents within the 30 days that he elected to perform his part of the contract, "and to thereby acquire the undivided one-half interest"; that he then and there proceeded to expend and did expend $2,000 in pursuance of the contract; and that afterwards, on or about the 9th day of July, A. D. 1895, the defendants informed him that they would not be bound by the contract, and repudiated it, and have ever since refused, and do now refuse, to be bound by the terms thereof, or to permit plaintiff to continue the performance of labor on the property, or to expend the remainder of the $10,000, or to erect a mill, and refuse to allow the appellant to enter upon the claims, or to do work thereon, and have refused to execute to him a deed to the one-half interest. The prayer of the complaint is that the respondents be let into possession of the premises for the purpose of performing the work under the contract, and for the purpose of erecting the mill, and of otherwise performing and carrying out the covenants of the contract, and that defendants be restrained from interfering with the work of plaintiff, "and that upon the completion of said labor and the expenditure of said money and the erection of said 10-stamp quartz mill the plaintiff be decreed to be the owner of one-half interest in and to the prem ises set forth in said complaint," and that defendants execute a conveyance to him of an undivided one-half interest, etc. Nothing is said about the tender under the $500,000 clause, nor is any relief asked under it; so that the only asserted right to a decree of specific performance is that based on the $10,000 and quartz mill clause. Of course, there is, on the face of the instrument, no mutuality of contract, for appellant does not promise in it to do anything. It is contended, however, that afterwards his notice to respondents of his election to proceed under the contract made it mutual, under the principle announced in Sayward v. Houghton, 119 Cal. 545, 51 Pac. 853, and 52 Pac. 44, and some other cases cited; but, with our views of the case, it is not necessary to discuss the applicability of that principle here. Neither is it necessary to consider the point (which is certainly not without merit) that the contract itself is void for all purposes on account of its ambiguity and uncertainty. In our opinion, the contract is one which does not allow a mutuality of the remedy of a decree of specific performance, and is not, in its nature, a contract which a court of equity would undertake to enforce specific