Wineberg v. Moore

194 F. Supp. 12
CourtDistrict Court, N.D. California
DecidedJune 22, 1961
Docket34863
StatusPublished
Cited by6 cases

This text of 194 F. Supp. 12 (Wineberg v. Moore) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wineberg v. Moore, 194 F. Supp. 12 (N.D. Cal. 1961).

Opinion

OLIVER J. CARTER, District Judge.

This is an action by William J. Wineberg, a citizen of Washington, for quiet title and other relief upon 880 acres of timber land in Humboldt County, located in northern California. The amount in controversy exceeds the sum or value of $3,000, exclusive of interest and costs, and is between citizens of different states; therefore, jurisdiction is established on the basis of diversity of citizenship as provided by Title 28 U.S.C. § 1332. The real property and transactions critical to the disposition of this matter occurred in California, and it is deemed that California law is controlling. See Erie R. R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188.

Wineberg alleges that he purchased the property from O. O. Barker in May, 1948, for $6,000, but he failed to record his deed in Humboldt County until May, 1951. In the interim Barker, the seller, made a contract for the sale of the timber on the land to the defendant, Construction Engineers, which contract was recorded in 1950; in 1951 Barker sold the property again, deeding it this time to the defendant, Natural Resources, Inc., and this deed was also recorded before the Wineberg deed. Throughout this period, several judgments were obtained against O. O. Barker, and some of these judgment creditors are also defendants.

At the outset, this Court must resolve the difficult factual question of whether or not Wineberg ever actually purchased the property from Barker. It is urged that the $6,000 advanced to Barker was intended as a loan, with the deed given to Wineberg serving only as security for the loan.

The evidence shows that prior to May 22, 1948, the date on which Barker delivered the deed to Wineberg in Portland, Oregon, that Wineberg was negotiating with an Oregon firm, the Weinert Lumber Co., for the sale of some timber owned by Wineberg in Oregon. Wine-berg’s testimony indicated that, contemplating both the purchase of the California property from Barker, and also the sale of his Oregon timber to the Weinert Lumber Co., he wanted to unite both transactions into a like-for-like trade and thus avoid payment of taxes on the gain realized upon the sale of the Oregon timber. Before this proposed transaction was consummated, however, Barker came to Portland on May 22, 1948, delivered the deed granting the property *14 from him directly to Wineberg, and received Wineberg’s check for $6,000. It appears that Wineberg at that time wrote this notation on the check:

“In full, 880 acres, Humboldt Co. Calif.”

However, lines have been drawn through this notation so as to partially obliterate it, and the superimposed word “Loan” was written over it. Wineberg’s cheek stub for this check has the word “Loan” entered thereon, and his books show that on that day he made a loan to Barker of $6,000. Three days later, Wineberg executed a bill of sale to Weinert Lumber Co. for his Oregon timber, and this document recites that the timber is transferred to Weinert Lumber Co. in trade for timber located in California. Two days later, on May 27, 1948, this unusual transaction occurred: Barker returned to Portland, and Wineberg delivered to him a second check for $6,000 from Weinert Lumber Co. and naming Barker as payee. Weinert Lumber Co. treated its check to Barker, to whom it was a stranger, as payment to Wineberg for the Oregon timber he transferred to Weinert Lumber Co., and Wineberg entered the $6,000 check from Barker to him as payment of the loan for the same amount he had made to Barker five days previously.

The defendants, seeking to defeat Wineberg’s claim of absolute ownership in the property, insist that these loan indications, entered by Wineberg’s own hand, show that Wineberg actually loaned Barker $6,000, and that therefore he only acquired a security interest in the land. As Barker still wound up with $6,000, no part of which was ever returned to Wineberg, this would negate the idea that the parties intended a loan instead of a sale. Paradoxically, Barker himself is of little assistance. For seven years and up to the time of trial, he had assumed that he had sold the' land to Wineberg, even endeavoring to straighten out Wineberg’s title for him when he complained that some of the defendants were removing timber from the land. At the trial, Barker’s best recollection was that this was a loan transaction.

The question to be ascertained is whether or not the parties intended this deed to be a security device, or to convey an absolute estate as the deed purported to do. See Greene v. Colburn, 160 Cal. App.2d 355, 325 P.2d 148. The deed from Barker to Wineberg purported to convey a fee simple absolute, but “a deed absolute on its face may in equity be shown by parole evidence to have been intended as security for a debt, and hence only a mortgage.” Anglo-Californian Bank v. Cerf, 147 Cal. 384, 388, 81 P. 1077; see also § 2925 Civil Code of California; Sherman v. Panno, 129 Cal.App.2d 375, 277 P.2d 80; Beeler v. American Trust Co., 24 Cal.2d 1, 147 P.2d 583. In the Sherman case, cited supra, the court stated at page 388 of 129 Cal.App.2d, at page 88 of 277 P.2d, that:

“ * * * in order to determine the true character of the transaction, the trial court should consider all the facts and circumstances surrounding the transaction, including the conduct of the parties before and after.”

A deed purporting to convey all interests that a grantor possesses is presumed to do just that, and not to create a mere security interest. See Gronenschíld v. Ritzenthaler, 81 Cal.App. 2d 138, 183 P.2d 720. The establishment of a deed absolute as a security device requires clear and convincing proof. Mahoney v. Bostwick, 96 Cal. 53, 30 P. 1020; Kohn v. Parent, 174 Cal. 570, 163 P. 1008. Furthermore, this burden of proof rests with the party attempting to alter the plain terms of the deed. Woods v. Jensen, 130 Cal. 200, 62 P. 473.

The circumstances surrounding the deed from Barker to Wineberg is not without doubt as to the true intent of the parties in respect to the interest created, but this Court is not persuaded that this transaction was merely a security device to secure a loan to Barker. And since the evidence of a loan was *15 not clear and convincing, it follows that this deed must stand as a conveyance of the fee simple absolute.

This Court must now ascertain whether or not failure to record by Wineberg makes his legal title subject to the prior recordings by Construction Engineers and Natural Resources, Inc., or whether these defendants were put on notice by conduct of Wineberg so as to preclude a subsequent good faith purchase of any interest in the property by said defendants.

Construction Engineers seeks to defeat Wineberg’s right to the timber on the property by virtue of its 1950 contract with Barker for the sale of the timber on the land, which contract was recorded prior to the time that Wineberg recorded his deed.

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Cite This Page — Counsel Stack

Bluebook (online)
194 F. Supp. 12, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wineberg-v-moore-cand-1961.