Rodgers in consideration of the satisfaction of the judgment. The transaction as it was made, however, was perfectly legal in the form it took, and we think, conceding the good faith of the transaction, as we must, was wholly within the rights of the parties.

The complaint made of error because of the giving of certain instructions and refusal to give other instructions offered has been examined. The court, in the view we take of the case, properly submitted to the jury the question as whether the transaction wherein the note and assignment were given and made was one carried out in good faith and with the intent to extinguish the liability of Irwin upon the judgment. The instructions as a whole appear to have sufficiently and correctly stated such propositions of law as the jury needed advice upon.

The judgment and order are affirmed.

Conrey, P. J., and Shaw, J., concurred.

A petition to have the cause heard in the supreme court, after judgment in the district court of appeal, was denied by the supreme court on April 23, 1917, and the following opinion then rendered thereon:

THE COURT.-In its petition for rehearing the defendant insists that the opinion of the district court of appeal holds that, under the terms of the policy of insurance to Nevada Irwin, the company became bound to pay to Irwin the amount of the judgment recovered against her by the injured party as soon as it became final, and without previous payment thereof by Irwin to the injured party, and that the decision is based on that proposition.

The opinion is not based solely on that proposition. It also proceeds upon the theory that the payment by Irwin of the judgment against her in favor of the injured party is at condition precedent to the existence of a cause of action in favor of Irwin against the company, as indeed the policy expressly declares; but that such previous payment need not be made in money, but may be made in property of any kind, including the promissory note of Irwin if such note is accepted expressly as payment; a theory in which we concur.

This leaves as the main point of the case the question whether or not the note was accepted as payment and was made in good faith. This, as the district court says, is primarily a question of fact which the jury, on the evidence, resolved against the company.

The petition for rehearing is denied.

[Civ. No. 1955. First Appellate District.-February 24, 1917.] PLEASANT VALLEY HOTEL CO. (a Corporation), Respondent, v. E. A. HENDERSON, Appellant. STATUTE OF LIMITATIONS-MONEY BORROWED BY DIRECTORS FROM CORPORATION REPAYMENT UPON ACCOMPLISHMENT OF PURPOSES OF LOAN. Where money belonging to a corporation is borrowed by two of its directors for certain purposes upon an agreement to repay the same when the purposes should be accomplished, and the corporation ratifies the transaction, the statute of limitations does not commence to run against the corporation's right to recover the money from the time the money was obtained, but from the time that the purposes were accomplished.

APPEAL from a judgment of the Superior Court of Fresno County. George E. Church, Judge.

The facts are stated in the opinion of the court.

Everts & Ewing, for Appellant.

C. K. Bonestell, for Respondent.

KERRIGAN, J.-This is an appeal by defendant from an adverse judgment. The question for determination in this case is as to whether or not, of the several causes of action alleged in the complaint, the demand therein set forth for one thousand dollars was barred by the provisions of subdivision 1 of section 339 of the Code of Civil Procedure.

The record shows that the action was commenced on November 19, 1914; that on January 6, 1912, defendant and one George F. Patterson, who were directors of the Pleasant Valley Investment Company, plaintiff's assignor, borrowed

from that company two thousand dollars for certain purposes, and agreed to repay the same when those purposes should be accomplished; that those purposes were accomplished so far as they could be in April, 1913, at which time, in compliance with their agreement, each was charged on the books of the company with one thousand dollars, and that at that time each agreed to pay to the Investment Company such sum; that George F. Patterson paid the money so borrowed by him, but that the defendant has failed and neglected to repay the amount so charged against him.

Assuming that the circumstances under which the two thousand dollars were obtained from the Pleasant Valley Investment Company stamped the transaction as a conversion of the funds of that company, still the company could waive the conversion, and repudiating the action of defendant and Patterson, could perhaps have brought an action immediately for money had and received. However that may be, it appears from the record that the Pleasant Valley Investment Company elected to ratify in detail the transaction as negotiated by those directors; it chose to adopt their acts as its own, to regard them as valid and to enforce the performance of the obligations arising therefrom. Therefore, the statute of limitations did not commence to run against the plaintiff's cause of action on January 6, 1912, the time the money was obtained by defendant and Patterson, but from the time the obligation to repay was fixed, to wit, in April, 1913. The action, therefore, having been filed in November, 1914, was brought before it was barred by the statute.

Judgment affirmed.

Lennon, P. J., and Richards, J., concurred.

A petition to have the cause heard in the supreme court, after judgment in the district court of appeal, was denied by the supreme court on April 23, 1917.

[Civ. No. 2219. Second Appellate District.-February 24, 1917.]

B. L. CHAMBERS et al., Respondents, v. BELMORE LAND & WATER COMPANY (a Corporation), Appellant. LEASE-ACTION FOR BREACH-PROXIMATE CAUSE OF DAMAGE.—In this action to recover damages for the breach of the terms of a contract of lease, it is held that the proximate cause of the damage sustained by the plaintiff was the failure of the defendant to construct headgates, as provided by the lease, to enable the plaintiff to irrigate the land demised.

ID. PREVENTION OF DAMAGE-RULE INAPPLICABLE.-Where the failure to construct such headgates caused a failure of a large portion of the lessees' crop, they cannot be denied recovery on the ground that they should have constructed the headgates themselves, where the cost of such construction would have been upward of two thousand dollars.

ID. NEW TRIAL-NEWLY DISCOVERED EVIDENCE.-A new trial will not be granted on the ground of newly discovered evidence which was almost wholly cumulative, and particularly where it appeared that by the exercise of reasonable diligence the unsuccessful party could have procured such evidence at the trial.

APPEAL from a judgment of the Superior Court of Los Angeles County, and from an order denying a new trial. Charles Wellborn, Judge.

The facts are stated in the opinion of the court.

Barstow, Beach & Rohe, for Appellant.

Drew Pruitt, and H. G. Redwine, for Respondents.

SHAW, J.-The subject of this action is defendant's alleged liability for damages due to its breach of the terms of a contract of lease made to plaintiffs. Upon trial judgment was entered in favor of plaintiffs, from which, and an order denying its motion for a new trial, defendant appeals.

The evidence tended to establish the following facts: Defendant was the owner of a large tract of land in Fresno County, which it leased for the growing of grain thereon, to plaintiffs, who agreed to pay defendant as rental therefor onefifth of the crop grown thereon during the season of 1912. The land was located in an arid zone, by reason of which fact

same.

it was necessary in the growing of crops thereon to irrigate the The source of supply of water for such irrigation was two streams known as Silver Creek and Panoche Creek, having their sources in the mountains, and which as a rule during the rain and flood seasons afforded a supply of water, which, however, varied from year to year, depending upon the precipitation of moisture upon the watershed tributary to said creeks. In order to utilize the waters of the creeks for irrigating the land, it was necessary to construct a dam across the streams whereby to divert the water therefrom into a main canal, by means whereof and lateral ditches connected with said main canal it was distributed over the land. The lease contained provisions as follows: "It is agreed by party of the first part (defendant), that he shall construct a dam across the Silver Creek and Panoche Creek on or before December 20th, 1911, and to place headgates at different points of turnouts. It is agreed by party of the second part (plaintiffs), that he shall use all water from Silver Creek and Panoche Creek diligently, which means, as long as water can be had in heads of one hundred inches or more, and that it shall be turned either upon the land farmed by said second party, or upon other land owned by party of the first part. It is further agreed on part of party of the second part (plaintiffs), that he shall keep said dam and gates in repairs and that he will attend said dam in person or by reliable party during heavy rains." Plaintiffs entered upon the land and in the winter of 1911 and 1912 plowed and prepared about eight hundred acres thereof for grain, which they seeded to barley, and also reconstructed and cleaned the lateral ditches extending throughout the tract for use in irrigating the grain. Defendant constructed the dam across said streams, completing the same some time in February and prior to there being sufficient rainfall to affect the flow of water in the creeks, but at all times neglected and refused to construct the headgates which it agreed to install in the main canal for the purpose of diverting water therefrom into the lateral ditches, the cost of which would have been about two thousand dollars. It appears there was little rainfall upon the watershed tributary to said creeks during the winter, but that about March 1st there was a storm as a result of which the creeks were filled with water for a period of about fifty hours, during which time plaintiffs, as best they could without the headgates, and