Bank of Chelsea v. Elam

1. Facts stated: On May 20, 1929, the defendants J. T. Elam and Lillie Elam, his wife, executed a promissory note for $3,192, payable to the Bank of Chelsea on August 8, 1929. On the same date, the defendants executed another note for $2,000, payable to the Bank of Chelsea on August 8, 1929. Both of the notes were secured by chattel mortgages and a mortgage on some real estate. The $2,000 note was also secured by a real estate mortgage on the homestead of the defendants.

After the execution of the notes, Lillie Elam received $500 from her deceased mother’s estate, and paid the amount to the…