California Trust Co. v. Smead Investment Co.

This is an appeal from a judgment in an action for a deficiency upon a promissory note which was secured by a deed of trust and after foreclosure thereof. The note and deed of trust were executed on June 12, 1929, in favor of the California Bank. The plaintiff herein was named as trustee in the- deed of trust. On October 23, 1929, the note was assigned to the plaintiff and the plaintiff continued to be the owner thereof until it was surrendered to the court for cancellation upon entry of final judgment herein. . On February 14, 1933, at a time when the note had become due and certain instalments of interest were unpaid and while the note was in the possession of the state treasurer of California, as plaintiff’s pledgee, as a part of the $200,000 worth of security deposited by the plaintiff with said treasurer under the provisions of section 96 of the Bank Act, plaintiff caused notice of default and election to sell to be recorded in the office of the county recorder. More than a month prior to the foreclosure sale the plaintiff withdrew the note from the office of the state treasurer, substituting other collateral with him. The foreclosure sale was held on June 13, 1933, the…