May, 1902.]

Opinion of the Court-ANDERS, J.

ing a first and prior lien thereon, and comprising all the property owned by them not exempt from execution, excepting the 160 acres of land above described, and on said date the right of said Eastman to a patent for said 160 acres of land was being contested in the United States land office by one Benjamin F. Wiseman, under and by virtue of an alleged homestead right therein, and the rights of said Patrick Russell in and to said land were wholly dependent upon the decision in that litigation. That on or about September 28, 1893, the said Patrick and Mary A. Russell were also indebted to the First National Bank of Walla Walla in the sum of about $11,000, evidenced by a promissory note for the sum of $9,810 and interest, made, executed, and delivered by them to said bank on October 14, 1892, which note was further executed by one William O'Donnell as surety, and which was not otherwise secured. That by reason of said indebtedness and other indebtedness of said Patrick and Mary A. Russell they were, on said September 28, 1893, wholly insolvent, and were without any means whatever with which to pay their said debts, or any thereof, except the said property mortgaged to plaintiff, and thereupon, for the purpose of indemnifying the said O'Donnell against loss as surety on said note so executed by him to said bank to the extent of the value of the 160 acres of land above described, the said Patrick Russell and Mary A. Russell, as the equitable owners thereof, caused the said Eastman to make, execute, and deliver to him a deed of conveyance conveying to him the said premises, and on said date the said Patrick and Mary A. Russell made, executed, acknowledged, and delivered to said O'Donnell an agreement whereby, in consideration of the sum of one dollar and other considerations, they agreed to convey to him, by a good and sufficient deed, the said 160 acres of land as soon as they or

Opinion of the Court-ANDERS, J.

[28 Wash.

either of them should receive title thereto, and the defendant Eastman made, executed, and delivered his deed as aforesaid in pursuance of his contract with the said Patrick Russell to convey to him the legal title thereto in confirmation of the equitable ownership thereof by said Russell, and for the further assurance, on behalf of all of said parties, that the said O'Donnell, his heirs and assigns, should be vested with the full ownership and title thereof for the purpose of securing him against liability on account of said note, to the extent of the value of said lands. That the said O'Donnell took and held said lands thereafter for the purposes aforesaid until he conveyed the same to the plaintiff. That the deed from said Eastman to said O'Donnell was filed and recorded in the office of the auditor of Walla Walla county on October 10, 1893. That on or about October 4, 1893, said note to said bank had or was about to become due, and payment thereof was thereupon demanded by said bank from said Patrick Russell and Mary A. Russell and said O'Donnell, and the said Patrick and Mary A. Russell were then and there wholly insolvent, and unable to pay the same, and thereupon, and on or about said last mentioned day, the plaintiff, the said Patrick Russell and Mary A. Russell, the said bank and the said O'Donnell made and entered into a contract, with the knowledge and consent of said Eastman, wherein and whereby it was mutually covenanted and agreed that the plaintiff should release from his said mortgage and convey and assign to said bank, 480 acres of the 960 acres of land included therein, to be held by the bank as security for its said claim against the defendants Patrick and Mary A. Russell and William O'Donnell, evidenced by said note, and in consideration thereof the said bank agreed to release the said O'Donnell as surety on said note, and to discharge him from all liability on account thereof,

May, 1902.]

Opinion of the Court-ANDERS, J.

and the said O'Donnell in consideration of such release, and at the request of Patrick and Mary A. Russell, contracted and agreed to convey to the plaintiff the above described 160 acres of land, which he then held as such indemnity; and the said Patrick and Mary A. Russell, in consideration of the premises, and for the purpose of further securing to the plaintiff the said 160 acres of land in lieu of the lands so released from his mortgage, agreed to make, execute, and deliver to the plaintiff all necessary covenants and agreements to fully vest in the plaintiff a valid and subsisting lien upon said 160 acres of land. That on October 4, 1893, in pursuance of the terms and conditions of said contract on their part, the said Patrick and Mary A. Russell executed and delivered to the plaintiff their certain agreement, wherein and whereby they covenanted and agreed, in consideration of one dollar and the mutual agreements in the contract above set forth, to convey to the plaintiff, as soon as their title thereto should be affirmed, the said 160 acres of land, the same to be held by him as security in lieu of the 480 acres so released to said bank, and on said date the plaintiff, relying solely upon the terms of said contract and agreement, and in compliance with the terms thereof, in good faith, and at the special request of said Patrick Russell and Mary A. Russell and said O'Donnell, in consideration of the premises and the mutual covenants and agreements aforesaid, released from his said mortgage and assigned to said bank 480 acres of the 960 acres included in his said mortgage, of the value of $8,000, thereby lessening his security more than onehalf, and the said Patrick and Mary A. Russell thereupon ratified and affirmed said assignment to said bank; and in further pursuance of said agreement, and at the instance and request of Patrick and Mary A. Russell and said O'Donnell, the said bank fully released and discharged

Opinion of the Court-ANDERS, J.

[28 Wash. the said O'Donnell as such surety on said note, and thereafter held said lands so released from plaintiff's mortgage and conveyed to it as a valid and subsisting security for its said claim, and the said O'Donnell in compliance with the terms of said agreement on his part, and at the instance and request of said Patrick and Mary A. Russell, made, executed, and delivered to plaintiff a deed conveying to him the said lands and premises as security for his said claim, and in lieu of the lands released from said mortgage, which conveyance was duly recorded in the office of the auditor of Walla Walla county on March 6, 1895. That the plaintiff received no consideration for the release of said 480 acres of land from his mortgage, and the assignment thereof to said bank, other than the aforesaid covenants and assurances that he should receive the said 160 acres in lieu thereof. That on said date the said Patrick Russell and wife were, and many years prior thereto had been, in possession of said premises, and claimed to own the same subject to the lien of said O'Donnell so conveyed to plaintiff as aforesaid, and were then entitled to receive from said Eastman a valid conveyance thereof as soon as he obtained a patent therefor from the United States. That the defendants Patrick and Mary A. Russell have ever since continued and now continue to occupy, hold, possess, and enjoy said premises and the rents, issues, and profits thereof, all of which the defendant Eastman well knew and acquiesced in. That said premises are of the value of less than $3,500. That from the year 1891 until the close of the year 1895 the litigation between said Wiseman and the said Eastman was pending in the United States land office. That in the month of March, 1896, the plaintiff, without having any knowledge or notice that said litigation had been decided in favor of the said Eastman, or that a patent had been issued to him

May, 1902.]

Opinion of the Court-ANDERS, J.

therefor, and without waiving any of his rights therein or thereto, brought an action in the superior court of Walla Walla county, wherein he was plaintiff and the said Patrick and Mary A. Russell were defendants, upon the two promissory notes executed by them to the plaintiff and for the foreclosure of the mortgage upon the 480 acres of land remaining therein given to secure the same, and for a deficiency judgment; and thereafter, and upon personal service of said defendants with process, such proceedings were had therein that on April 10, 1896, a judgment was duly made and given in said court and cause in favor of the plaintiff and against the said defendants, jointly and severally, for the sum of $12,873.45, with interest thereon from the 12th day of January, 1896, at the rate of ten per cent. per annum until paid, together with $450 attorney's fees and the costs of said action taxed at $22.40, and decreeing that the said 480 acres of land be sold in the manner provided by law, and the proceeds of such sale applied to the satisfaction of said judgment, costs, and attorney's fees; and further decreeing that, in case of a deficiency of said proceeds to satisfy said judgment, costs, and attorney's fees, the same be a joint and several judgment against the said defendants for such deficiency, and be satisfied out of any other property belonging to said defendants, and that execution issue therefor. That under and in pursuance of said judgment and decree the said lands were duly sold in the manner provided by law, and in accordance with said decree, for the sum of $7,500. That thereafter said sale was confirmed, and the said amount duly credited as a payment upon the said decree upon the records of said court in said cause. That no other sum or amount has been paid upon said decree, and there re mains due and unpaid thereon the sum of $8,000, with interest thereon from May 1, 1899, at the rate of ten per cent.