Stack v. Stack

CnARicsoN, J.

Tbe issues above outline and are determinative of tbe controversy.

At tbe close of plaintiff’s evidence and at tbe close of all tbe evidence, tbe defendant Commissioner of Banks, made motions for judgment as in case of nonsuit. C. S., 567. Tbe motions were overruled and in tbis we see no error.

*466We think that all the exceptions and assignments of error made by the defendant Commissioner of Banks can be considered under the one made above to the signing of the judgment in this action., and in this respect we can see no error .on the record.

We think the main question of law involved in this controversy: In an action between the payee and maker of a note, is parol evidence admissible to establish an agreement between the maker and payee creating a particular mode of payment? We think so under the facts and circumstances of this case.

J. E. Stack was a director in the Bank of Union, and had been from the organization of the bank, some 27 years, until his death 11 May, 1929, during that period W. S. Blakeney, his brother-in-law, was the president of the bank. Stack was a large dealer in spot cotton, and had valuable real estate in the town of Monroe, N. C., but he had become deeply indebted to the bank, and on 8 June, 1927, owed said bank some $80,000. He was then an old man — some 75 years of age. At the time his real estate was more than sufficient to pay the indebtedness. He was over the limit allowed by law to be borrowed from the bank, and the bank examiner had notified the president, W. S. Blakeney, that Stack had to be held to the limit allowed by law and had to reduce his indebtedness.

It was contended by the heirs at law of J. E. Stack, who are involved in this controversy, and plaintiff, the widow of J. E. Stack, that the conveyances' from J. E. Stack and herself of the lands in controversy in this action to the said heirs at law of J. E. Stack, and from them to W. S. Blakeney, trustee, was a makeshift or means of helping the Bank of Union, engineered by its president Blakeney, and they were merely a conduit. No consideration passed and no liability was to attach to the heirs at law of J. E. Stack, and the whole matter was arranged and fixed up by the president of the bank, Blakeney, for the purpose of complying with the law on account of the excess borrowed from the bank by J. E. Stack. It was an indirect mortgage from J. E. Stack to the Bank of Union, the heirs of J. E. Stack never acquired any beneficial interest in the lands. The heirs at law were-to assume no liability, but the indebtedness to the bank was to be paid out of the land. The said heirs at law of J. E. Stack had nothing to do with drawing or recording the deeds to them or the conveyances from them to W. S. Blakeney, trustee, and others. They never saw the deeds to the lands, nor took possession or had any control of the lands; never contracted to buy the lands; received no rents or profits; paid no taxes on the lands. J. E. Stack, until his death, had custody and control of the lands and after his death Blakeney had control, and repairs were made to *467tbe property by Blakeney. It was well understood by tbe parties to tbe entire transaction tbat tbe makers were not to be responsible, but it was J. E. Stack’s debt -and be was to remain liable therefor and be was tbe beneficial owner of tbe lands. His beirs at law were mere agents for a particular purpose. Tbey beld tbe legal title for tbe particular purpose, and J. E. Stack was tbe beneficial owner of tbe equity in tbe lands.

A. M. Stack testified, in part: “Mr. Blakeney asked we children to sign tbis deed and execute mortgages to tbe bank in order to reduce my father’s indebtedness as well as help tbe bank, because be was being-pressed by tbe bank examiners to reduce bis notes. Q. Did Mr. Blakeney say anything relative to whether or not you would be bound by tbe execution of those notes? A. Yes, sir. Q. What did be say? A. He said tbat tbe property could be later transferred back to tbe estate; tbat it was just a method of using our names to get money for tbe Bank of Union and for my father’s notes.”

Tbe proceeds were applied on J. E. Stack’s indebtedness to tbe bank. A. M. Stack testified further: “Q. Mr. Stack, has anybody ever called on you to pay these notes or tbe interest on tbe note? Answer: No, sir; I have never received a statement from tbe Bank of Union tbat we owed any money on it. Q. Mr. Stack, did you get anything of .value by reason of signing these notes? Answer: No, sir; I have never received or given anything of value.”

Blakeney testified, in part: “Tbe transaction was not made to deceive anybody; I was acting in a dual capacity — as executor and president of tbe bank and I thought my first duty was to tbe bank and I wanted to do tbe equitable thing all around, not only to tbe bank but to tbe beirs, give them a chance. . . . All tbe indebtedness of tbe said J. E. Stack to practically all tbe creditors except tbe Bank of Union has been paid with tbe exception of'some small bills. ... I did not tell tbe signers óf these notes (said J. E. Stack’s children) tbat tbey would not be beld personally liable for tbe payment thereof. I told them the property would stand between them and any other liability; tbat I thought tbe property would be ample to take care of it and I did not tell them tbat tbey would not be personally liable.”

A. M. Stack, Jr., testified, in part: “Q. Mr. Stack, 'Mr. Blakeney testified tbis morning tbat be told you it would stand between you and personal liability on tbe note? Answer: Yes, sir; be certainly did. Q. What else did be say to you ? Answer: He said tbe property would stand for itself. Q. Did be. tell you tbat at tbe time you executed both of these notes of 12 September? Answer: Yes, sir. Q. Did you communicate tbat to your brothers and the other defendants in tbis case? Answer: Yes, sir.”

*468The above testimony of A. M. Stack, Jr., and like testimony of other witnesses, in regard to all the transactions, was objected to on the ground that “parol testimony cannot be admitted to contradict, add to or vary a written contract in the absence of fraud, ignorance, mistake or other available defense warranting a rescission or cancellation.” Miller v. Farmers Federation, 192 N. C., at p. 146.

We think the testimony objected to competent (exceptions and assignments of error 1 to 191 inclusive) and the doctrine laid down in Evans v. Freeman, 142 N. C., at p. 64-5 applicable: “But this rule applies only when the entire contract has been reduced to writing, for if merely a part has been written, and the other part has been left in parol, it is competent to establish the latter part by oral evidence, provided it does not conflict with what has been written. . . . Numerous other cases have been decided by this Court in which the application of the same principle has been made to various combinations of facts, all tending, though, to the same general conclusion that such evidence is competent where it does not conflict with the written part of the agreement and tends to supply its complement or to prove some collateral agreement made at the same time.”

In Greene v. Bechtel, 193 N. C., at p. 98, Stack, J., charged the jury, as follows, which was sustained by this Court: “When a contract is written, the law will not allow it to be altered, varied from that, or contradicted by parol evidence. When they put their contract in writing, that is the contract, but when a part of the contract is written and a part of it is in parol or verbal, and the verbal part does not alter, vary or contradict the written part, then the party claiming that parol agreement may show it by parol evidence.”

In Bank v. Winslow, 193 N. C., at p. 473, the law is thus stated: “In Brown on Parol Evidence, sec. 117, it is held that ‘parol evidence is admissible to show an agreed mode of payment, and- discharge other than that specified in the bond.’ And in Typewriter Co. v. Hardware Co., 143 N. C., 97, it was held that when a promissory note is given, payable in money, parol evidence may be received tending to establish as a part of the contract a contemporaneous agreement that a different method of payment should be accepted,” citing numerous authorities.

In Justice v. Coxe, 198 N. C., at p. 265, it is said: “Parol evidence offered by defendant for the purpose of showing all the terms of the contract between plaintiff and defendant, with respect to the transaction of which the execution of the notes was only a part, was admissible and competent for that purpose. Crown v. Jones, 196 N. C., 208, 145 S. E., 5.”

*469On this record in what is written and what is in parol .we can see no “total inconsistency.” Garland v. Improvement Co., 184 N. C., 551; Exum v. Lynch, 188 N. C., 392 (in same case see, also, term “consideration” that is sufficient to support a promise). Watson v. Spurrier, 190 N. C., 726; Miller v. Farmers Federation, 192 N. C., 144; Hite v. Aydlett, 192 N. C., 166; Fertilizer Co. v. Eason, 194 N C., 244; Smith v. Trust Co., 195 N. C., 183; Roebuck v. Carson, 196 N. C., 672; 20 A. L. R., 479 (n); Hill v. Insurance Co., 200 N. C., 502.

The Parol Evidence Rule in North Carolina is learnedly discussed by James H. Ohadbourn and Dean Charles T. McCormick, in N. C. Law Review, February, 1931, p. 151 et seq.

On the entire record we see no prejudicial or reversible error. Prom the view we take of the law there was no error in the admission or rejection of testimony or the charge of the court below to the jury. In the issues submitted perhaps the phraseology should have been more exact, but they were, from the evidence, understood and determinative of the controversy. "We think the charge on the whole complied with C. S., 564.

From the findings of the jury J. E. Stack had an equitable estate in the lands. Ilis widow, the plaintiff, is entitled to dower. C. S., 4100. After a thorough consideration of this action and the evidence, we can see no such repudiation as calls for criticism on the part of appellant. The indebtedness of J. E. Stack to the bank was neither that of his widow, now the plaintiff in this action, nor that of his children. The widow and certain of the children of age, under the facts and circumstances of this case, did what was requested of them by the husband and father, in an effort to aid the adjustment of honest obligations to the bank, which was beyond the law limit allowed to one individual, and from the jury finding done in accordance with the demand of the president of the bank, and through his efforts. The children to this action are making no claim to the lands, the whole matter was without consideration and an accommodation for their father, and the transactions were in effect indirect mortgages of J. E. Stack by certain of his children, for the purpose of adjusting honest debts. The bank will get the land subject to the widow’s dower. A father would hardly put a personal burden of his debts on his children as it was contended by appellant. The jury did not so find. For the reasons given, we see no error in the judgment of the court below.

No error.