Section 2835. Increase of Property Pledged: increase of property pledged is pledged with the property. 1887 R. S. Sec. 3412. The Section 2836. Lienor May Pledge Property: One who has a lien upon property may pledge it to the extent of his lien. 1887 R. S. Sec. 3413. Section 2837. When Owner Cannot Defeat Pledge: One who has allowed another to assume the apparent ownership of property for the purpose of making any transfer of it, cannot set up his own title to defeat a pledge of the property made by the other, to a pledgee who received the property in good faith, in the ordinary course of business and for value. 1887 R. S. Sec. 3414. RIGHTS OF BAILOR AS ΤΟ THIRD PERSONS: This section affords no protection to the pledgee of property received from one with whom it was left for safe keeping.-Shafer v. Lacy, 121 Cal. 574, 54 Pac. 72. Where one transferred and endorsed bank stock in blank, and delivered the same to his agent, with power to negotiate and pledge the same, he cannot recover for the conversion thereof by the pledgee of the agent, who took it in good faith for value, without refunding or offering to refund the amount advanced by the pledgee.-Brittan v. Oakland Bank of Savings, 124 Cal. 282, 57 Pac. 84; Ambrose v. Eyans, 66 Cal. 74, 4 Pac. 960; Arnold v. Johnson, 66 Cal. 402, 5 Pac. 796. Where goods are deposited in a warehouse in the name of an agent, who is apparently the goods by such agent as security for a loan is valid as against the real owner, if the pledgee acted in good faith and after notice that the pledgor was not the owner.-Amann v. Lowell, 66 Cal. 306, 5 Pac. 363. A pledge of the property of his principal made by a factor having its possession and control, as security for his individual debt, is good as against the principal, if the pledgee acted in the due course of business without notice of the actual ownership.-Wisp v. Hazard, 66 Cal. 459, 6 Pac. 91. Where goods are delivered to one merely that he may show them to a possible purchaser, one to whom he pledges them for money which he appropriates for himself has no title as against the rightful owners, -Rumpf v. Barto, 10 Wash. 382, 38 Pac. 1129; Thompson v. Toland, 48 Cal. 99. owner thereof, a pledge of the Section 2838. Third Person as Pledge Holder: A pledgor and a pledgee may agree on a third person with whom to deposit the property pledged, who, if he accepts the deposit, is called a pledge holder. 1887 R. S. Sec. 3415. Section 2839. Pledge Holder Must Enforce Rights of Pledgee: A pledge holder must enforce all the rights of the pledgee, unless authorized by him to waive them. 1887 R. S. Sec. 3416. ACTION BY PLEDGEE FOR CONVERSION OF PLEDGE: The pledgee as against a stranger to the pledgor and wrong-doer, who has converte] the pledge, may recover its full value; for he is answerable over to the pledgor for any surplus in his hands, See and if he recovers in such action, anl the wrong-doer satisfies the judgment, he thereby acquires title to the pledge. ---Thompson v. Toland, 48 Cal. 99. also Barnhart v. Fulkerth, 73 Cal. 526, 15 Pac. 89; Hawley Brothers Hardware Co. v. Brownstone, 123 Cal. 643, 56 Pac. 468. Section 2840. Credit by Misrepresentation; Rights of Pledgee: Where a debtor has obtained credit or an extention of time by a fraudulent misrepresentation of the value of property pledged by ot for him, the creditor may demand a further pledge to correspond with the value represented; and in default thereof may recover his debt immediately, though it be not actually due. 1887 R. S. Sec. 3417. Section 2841. Pledgee May Sell Pledge, When: When performance of the act for which a pledge is given is due, in whole or in part, the pledgee may collect what is due to him by a sale of property pledged, subject to the rules and exceptions hereinafter prescribed. 1887 R. S. Sec. 3418. REMEDIES OF THE PLEDGEE: A pledgee holding pledge as collateral security may after debt falls due, elect one of three remedies. 1. Proceed personally against pledgor for his debts without sale of pledge. 2. File a bill in chancery for a judicial sale under a regular decree of foreclosure. 3. Sell the pledge without judicial process upon reasonable notice to debtor to redeem.-Robinsor. v. Hurley, 11 Iowa, 410, 79 Am. Dec. 497. To the same effect is Sonoma Valley Bank v. Hill, 59 Cal. 107, in which the court says: "Now it is well settled that in the absence of a statute or stipulation to the contrary, the possession of the pledged property does not suspend the right of the pledgee to proceed personaliy against the pledgor for his debt after selling the pledge, for the reason that the security is only collateral." In Ehrlich v. Ewald, 66 Cal. 97, 4 Pac. 1062, the court says: "We find nothing which would prevent a pledgee from having his action to recover the debt, without first exhausting the subject of the pledge." The common law right of the pledgee to sell the pledge upon the default of the pledgor, and thereafter bring his action for any balance remaining unsatisfied, is wholly unaffected by Sec. 3331 of the Code of Civ. Proc.-Mauge v. Heringhi, 26 Cal. 577. TENDER AND DEMAND: The lien of the pledgee is extinguished when a tender of the amount due on the debt is made according to law and refused by the pledgee. Upon such tender being made and refused, when, on or after such tender, a demand is made for the pledge, which is refused, the pledgee is guilty of conversion.-Loughborough v. McNevin, 74 Cal. 250, 14 Pac. 369, 15 Pac. 773. Section 2842. Pledgee Must Demand Performance Before Sale: Before property pledged may be sold, and after performance of the act for which it is security is due, the pledgee must demand performance thereof from the debtor, if the debtor can be found. 1887 R. S. Sec. 3419. DEMAND AND NOTICE: A pledgee has no right to sell until after demand and notice; and if he sells without demand and notice, to a party having full knowledge of his title, no absolute title passes and the property remains in the hands of the purchaser as a pledge.-Dewey v. Bowman, 8 Cal. 145: Gay v. Moss. 34 Cal. 125. Where the pledgee sells the absolute property in the pledge to a bona fide purchaser. the purchaser is entitled to retain the pledge until the pledgor discharges the debt for which it was pledged.-Wi!liams v. Ashe, 111 Cal. 180, 43 Pac. 595. Section 2843. Notice of Sale to Pledgor Must be Actual: A pledgee must give actual notice to the pledgor of the time and place at which the property pledged will be sold, at such a reasonable time before the sale as will enable the pledgor to attend. 1887 R. S. Sec. 3420. NOTICE OF SALE: A pledgee has no right to sell until after demand and notice, and if he sells without demand and notice to a party having full knowledge of his title, no absolute title passes, and the property remains in the hands of the purchaser as จ pledgor.-Dewey v. Bowman, 8 Cal. 145. A pledgee can sell the property only, and such sale must be for the purpose of applying the proceeds to the pay ment of the debt, and must be at public auction after due notice to the pledgor or owner.-Morgan v. Dod, 3 Colo. 551. Where no time is fixed for the redemption of a pledge. a private sale thereof, made without demand or the pledgor or notice to him of the time and place of sale, is void.-Moffat v. Williams, 5 Colo. App. 184, 36 Pac. 914. If a sale of mining stock. pledged as security for money, is made without notifying the pledgor to make his margin good, and without sufficient notice of the time and place, still, if the pledgor knew of the time and place of sale and made no objection, and after the sale, approved of it anl promised to pay the balance claimed by the pledgee, he by these acts ratifies the sale.Child v. Hugg, 41 Cal. 519. Section 2844. Pledgor May Waive Notice of Sale: Notice of sale may be waived by a pledgor at any time, but is not waived by a mere waiver of demand of performance. 1887 R. S. Sec. 3421. See Williams v. Hahn, 113 Cal. 475, 45 Pac. 815, in which it was held under the circumstances that the plaintiff was not required to give any notice of the sale. The defendant had expressly waived all notice to himself and had authorized the plaintiff to sell wine at private sale. Section 2845. Positive Refusal to Perform is Waiver of Demand: A debtor or pledgor waives a demand of performance as a condition precedent to a sale of the property pledged, by a positive refusal to perform after performance is due; but cannot waive it in any other manner except by contract. 1887 R. S. Sec. 3422. Section 2846. Sale Must be by Public Auction: The sale by a pledgee of property pledged, must be made by public auction in the manner and upon the notice required upon sale of personal property under execution; and must be for the highest obtainable price. 1887 R. S. Sec. 3423. Sale of personal property under execution: Code of Civil Proc. Sec. 3543 et seq. AUCTION SALE: The sale by a pledgee of property pledged must be made by public auction, in the manner and upon notice to the public, usual at the place of sale in respect to auction sales of similar property, and must be for the highest obtainable price.-Bendel v. Crystal Ice Co. 82 Cal. 199, 22 Pac. 1112. The question whether a saie of mining stock made in the board of brokers is not a sale at public auction such as the pledgee is authorized to make upon default being made by the pledgor, is discussed but not decided in Child v. Hugg, 41 Cal. 519. Section 2847. Evidences of Debt Cannot be Sold; Exceptions: A pledgee cannot sell any evidence of debt pledged to him except the obligations of governments, states, territories, counties or corporations; but he may collect the same when due. 1887 R. S. Sec. 3424. Magee, 114 Cal. 126, 45 Pac. 1068. A creditor to whom claims are transferred as collateral security is bound to use ordinary diligence in collecting them, and is liable for loss resulting in his failure to do so; but if the transfer merely authorizes such creditor to receive the proceeds of the claims when collected, and apply them to the payment of his debt, he is not bound to prosecute their collection.-Miller Gettysburg Bank, 8 Watts, 192, 34 Am. Dec. 449 and note 451. RIGHT OF PLEDGEE RESPECTING EVIDENCES OF DEBT: A pledgee of mortgaged notes as collateral security, under an assignment which gives him the right, on default, to realize on the same by sale, but does not restrict him to that method, may either sell them or under this section of the Civil Code, he may realize on them by foreclosing the mortgage securing them, which, incidentally with them passed into pledge.-McArthur v. Section 2848. Pledgor May Require Pledge to be Sold, When: Whenever property pledged can be sold for a price sufficient to satisfy the claim of the pledgee, the pledgor may require it to be sold and its proceeds to be applied to such satisfaction when due. 1887 R. S. Sec. 3425. 294 Section 2849. JUDGMENT LIENS Proceeds of Sale, Disposition of: After a pledgee has lawfully sold property pledged, or otherwise collected its proceeds, he may deduct there from the amount due under the principal obligation, and the necessary expenses of sale and collection, and must pay the surplus to the pledgor on demand. 1887 R. S. Sec. 3426. Where the relation of pledgor and pledgee exists, if the debt is paid, it is the duty of the pledgee to acount for and pay over all the income, profits Section 2850. Property Sold Before Debt is Due, When property pledged is sold beWhat May be Retained: fore the claim of the pledgee is due, he may retain out of the proceeds all that can possibly become due under his claim, until it becomes due. 1887 R. S. Sec. 3427. Section 2851. Purchase: Pledgee or Pledge Holder Cannot A pledgee, or pledge holder, cannot purchase the property pledged, except by direct dealing with the pledgor. 1887 R. S. Sec. 3428. PLEDGEE CANNOT PURCHASE: If the property is sold by the pledgee in satisfaction of his demand, he cannot become the purchaser at his own But sale.-Wright v. Ross, 36 Cal. 414. the pledgor may consent to or ratify a purchase at public auction, by the pledgee of the property pledged.-Hill A sufficient v. Finigan, 62 Cal. 426. election by the pledgor to treat a purchase of the pledgee by the pledgor at valid cannot afterhis own sale as wards be restricted; nor can an elec- V. 10 a Section 2852. Pledgee May Foreclose: Instead of selling property pledged, as hereinbefore provided, a pledgee may foreclose the right of redemption by a judicial sale, under the direction of a competent court; and in that case may be authorized by the court to purchase at the sale. 1887 R. S. Sec. 3429. COURTS OF EQUITY, POWER OF sale of a negotiable instrument in satisfaction of the debt for which it is held in pledge. Whether it has suh power under ordinary circumstances: query? Donohue v. Gamble, 38 Cal. 340. JUDGMENT LIENS. Section 2853. Judgments of the United States Courts, how Made Liens: Judgments in the district or circuit courts of the United States, if rendered in this State, may be made liens upon the real estate owned by the defendant, and also upon all real estate he may subsequently acquire, the same as if obtained in the district court of the State, by filing an attested copy of the judgments in the office of the county recorder of the county in which the real estate is situated; and no lien shall attach to the lands or other realty in any county of this State until the date of filing such transcript, except in the county wherein the judgment was rendered, in which case the lien shall attach from the date of such rendition. 1899, 5th Ses. p. 80, Sec. 1; 1891, 1st Ses. p. 119. AT COMMON LAW: In the absence of statutory provision, a judgment is not a lien upon the debtor's land.Thompson v. Avery, 11 Utah, 214, 39 Pac. 829. EXTENT OF THE LIEN: A judgment lien attaches merely to the rights of the judgment debtor in the land and nothing more.-Smith V. Savage, 3 Kan. App. 556, 43 Pac. 847. WHEN THE LIEN ATTACHES: Under the Montana statute, it is provided that after filing a judgment roll, the clerk should make the proper en tries on the docket and that from the time a judgment is docketed, it shall become a lien, and it was held there. under that a judgment was not a lien until docketed, regardless of when it was rendered.-Sklower V. Abbott (Mont.), 47 Pac. 901. NOT AFFECTED BY DEATH OR PRESENTATION OF CLAIM: The lien secured on the property of a judgment debtor during his life, by docketing the judgment as provided by statute, is not affected by his death.-Morton v. Adams, 124 Cal. 229, 56 Pac. 1038. Moreover the presentation by the administrator of a judgment which is a lien on the property of the judgment debtor, as a claim against his estate, does not destroy the lien.-Id. MODIFICATION OF JUDGMENT: A Washington statute provides that when a judgment is modified, all liens and securities obtained under it shall be preserved to the modified judgment. It was held under that statute that although the record shows that a former judgment was, in form, vacated and a new one entered, yet where the new judgment is only for a small amount less than the other, and is otherwise the same, it should be treated as 流 modification of the former, SO as to preserve liens acquired thereunder.Smith v. De Lanty, 11 Wash. 386, 39 Pac. 638. NO LIEN ON TRUST PROPERTY: A judgment was recorded by a plaintiff against W. and remained for some time unpaid. A year later, a deed was executed to W., granting certain land. A year after that, an execution on the judgment was levied upon the land and a temporary injunction Was granted against the execution on the ground that W. held the land in trust for his brother, who intended to use it as a homestead. The injunction was made permanent, the court holding that, while it was provided by statute that the right of an incumbrancer for value of real property shall not be prejudiced by an implied or resulting trust of which there was no notice, the judgment in this case not having been obtained and not subsisting upon the land by reason of any advantage or value rendered to the particular property in question, and the land being the homestead of the defendant, the judgment is not an "incumbrance of the real property for value;" that the land would be subjected to its judgment.-Baird v. Williams, 4 Okl. 173. 44 Pac. 217. PROPERTY PREVIOUSLY CONVEYED: Held, under a similar statute, that its provisions do not extend the lien to property previously conveyed by the debtor to his wife by a deed valid and binding between the parties.-Sawtelle V. Weymouth, 14 Wash. 21, 43 Pac. 1101. PRIORITIES AS BETWEEN LIENS AND OTHER INTERESTS: In Kansas, an unrecorded deed takes precdence over a judgment lien acquired after the execution and delivery of the deed and before the same was recorded, although the judgment creditor has no notice of such deed.-Smith v. Savage, 3 Kan. App. 566, 43 Pac. 847; but where a mortgage is given to secure an antecedent debt, it is not prior in lien to a judgment entered the same day on which the mortgage was filed, although the judgment entered was not filed until after the filing of the mortgage, but will prorate with the judgment.-Goetzinger v. Rosenfeld, 16 Wash. 392, 47 Pac. 882; and where a judgment has been duly docketed, it is & lien on real property previously conveyed by the judgment debtor in fraud of creditors, since the statute made. the conveyance void.-First National Bank of Los Angeles v. Maxwell, 123 Cal. 360, 55 Pac. 980: Blair v. Ostrander, 47 L. R. A. 469. See extended note to this case. Section 2854. Duty of Recorder: The recorder shall, on the filing of such transcript in his office, immediately proceed to record and index the same in a separate book for that purpose, in the same manner as a judgment rendered in the court of his own county, and he shall be allowed to charge and receive the same fees as provided by the law for like service. 1899, 5th Ses. p. 80, Sec. 2; 1891, 1st Ses. p. 119. |