California Gas & Elec. Corp. v. Union Tr. Co. of S.F.

Plaintiffs sued under the provisions of section 1050 of the Code of Civil Procedure, to obtain a decree determining certain adverse claims made by defendant as trustee so created by the provisions of a certain “Unifying and Refunding Mortgage.” Dissatisfied with the amount of the defendant’s recovery under the terms of the judgment, plaintiffs appeal, asking for a modification of the said judgment. The appeal is upon the judgment-roll alone, and all of the questions involved in the controversy pertain to and involve an interpretation of the “sinking fund” provisions of the “Unifying and Refunding Mortgage.”

In 1908, California Gas and Electric Corporation executed to defendant as trustee its “Unifying and Refunding Mortgage” supporting a bond issue of forty-five million dollars. This mortgage was subordinate to and subject to the lien of a prior mortgage executed by the California Gas and Electric Corporation and seventeen other earlier mortgages given respectively by predecessors in estate of the California Gas and Electric Corporation to secure the payment of bonds, the face value of which outstanding and unmatured then amounted to more than thirty million dollars. In the…