Parke & Lacy Co. v. White River Lumber Co.

Citations

• 110 Cal. 658
• 43 P. 202
• 1896 Cal. LEXIS 530

Syllabus

<p>Mortgage for Debt of Another—Suretyship—Discharge of Lien— Change of Principal Contract.—When property of any kind is mortgaged or pledged by the owner to answer for the default or miscarriage of another person, such property occupies the position of a surety or guarantor, and anything which will discharge an individual surety or guarantor who is personally liable will, under similar circumstances, ■discharge such property; and the mortgaged property is exonerated from all liability as surety if, after the execution of the mortgage, the principal contract between the debtor and creditor is altered in any material particular without the consent of the mortgagor.</p> <p>Id.—Recitals in Mortgage—Estoppel—Reference to Lease—Conditional Sale—Alteration of Terms.—A recital in a mortgage executed by a third person to secure payments under a lease which operates in law as a conditional sale, that the principal debtor is justly indebted to the creditor for the full sum agreed to be paid as rent for certain machinery in accordance with the terms of the lease, does not estop the mortgagor from showing that the terms of the lease were afterward altered by the parties, and that no indebtedness ever accrued in accordance with its original terms.</p> <p>Id.—Note Secured by Mortgage—Foreclosure.—Where the mortgage, in addition to being given as security for the lease, is also given to secure the payment of a promissory note which is distinct from the lease or conditional sale, and which has not been altered in any respect, the mortgage should be foreclosed therefor, though discharged as to the lease by the change of its terms.</p> <p>Id.—Discharge of Surety in Part.—Where a surety is bound by one bond for the performance by the principal of two distinct things, and the contract is varied as to one of the things to be performed, the surety is discharged as to the matter concerning which the contract has been changed, but is not discharged from that as to which it has not been cha