136 S.E. 259 | N.C. | 1927
This was an action instituted by plaintiff against Leon Rochamora and Max Taub, partners, doing business as the Asheville Candy Company, to recover of defendants the sum of $1,000, alleged to be due on a bill of exchange or trade acceptance given by defendants to Kaufman Brothers, on 25 November, 1924, for the purchase of candy, payable 6 March, 1925. Plaintiff alleged it was endorsed "Kaufman Brothers — Sam Kaufman." The endorsement was denied by defendants.
It was alleged by plaintiff (paragraph 4 of the complaint): "That after said acceptance and said endorsement, before maturity, and for value, the plaintiff purchased said trade acceptance, and as such owner, forwarded same to Asheville for collection, and payment at maturity, but payment thereof was refused, and the same was on 6 March, 1925, duly protested for nonpayment; that demand has been made for payment, and payment refused, and there is due to the plaintiff the sum of one thousand dollars, with interest thereon from 6 March, 1925, by the defendants."
The defendants answer that the allegations of paragraph 2 of the complaint are untrue, as therein set forth, and are denied. "The defendants admit, however, that they signed a paper-writing substantially similar to that set forth in paragraph 2 of the complaint, but state further that any paper-writing signed by the defendants was signed upon an express agreement between the defendants and Kaufman Brothers, under which agreement the said Kaufman Brothers agreed to give credit to the defendants on said paper-writing for any defect in any goods shipped, and the defendants state that there was a defect in said goods, and that goods were not shipped which had been ordered by the defendants, and that the said Kaufman Brothers shipped other goods, which had not been ordered by the defendants, and are indebted to the defendants in at least the sum of eight hundred dollars ($800), which sum was to be credited on any paper-writing which may have been signed by the defendants under an express agreement in writing between the defendants and the said Kaufman Brothers."
Defendants answer paragraph 4 of the complaint, as follows: "The defendants are informed and believe that the allegations of paragraph *3 4 of the complaint are untrue and are denied. The defendants admit that they have not paid a paper-writing substantially similar to that mentioned in paragraph 2 of the plaintiff's complaint, which was, as the defendants are informed and believe, sent on for collection by Kaufman Brothers and which was owned by Kaufman Brothers at the time it became due, for the reasons hereinbefore set forth. Defendants expressly deny that they are indebted to the plaintiff in any sum whatsoever."
The issues submitted to the jury and their answers thereto were as follows:
"1. Is the plaintiff the owner of the trade acceptance in due course as alleged in the complaint? Answer: No.
2. If so, in what amount, if any, is the defendant indebted to the plaintiff?"
There was a judgment signed in accordance with the verdict and plaintiff assigned numerous errors and appealed to the Supreme Court. The material facts and assignments of error will be considered in the opinion. "If you find that the plaintiff bought the paper, that is, in due course, as I have defined that term, and did not take it as an agent for collection, then your answer to the first issue would be `yes'; if you do not so find, your answer to the first issue would be `no.' If as purchaser in due course, if the plaintiff has satisfied you by the greater weight of the evidence of that, your answer to the first issue would be `yes,' if not, and you find that the bank accepted it as a collecting agent, your answer to the first issue would be `no.'" Plaintiff assigns error. The main controversy hinges around the charge as stated above as incorrect in law, and there was no sufficient evidence to support it. We think the charge correct, and that there was sufficient evidence to go to the jury to sustain it.
C. S., 3108: "A bill of exchange is an unconditional order in writing, addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand or at a fixed or determinable future time a sum certain in money or order or to bearer." C. S., 3114.
In the present action the "bill of exchange" or "trade acceptance," was a negotiable instrument. This is conceded on the record. Sherrill v. TrustCo.,
The issue submitted to the jury: "Is the plaintiff the owner of the trade acceptance in due course, as alleged in the complaint?" we think *4 the proper one under the pleadings. The plaintiff alleged that it, in due course, purchased the trade acceptance and as such owner forwarded same to Asheville for collection, etc. The defendants deny that plaintiff purchased the paper-writing, and allege that Kaufman Brothers was the owner at the time it became due and was sent on by them for collection. Defendants expressly deny that they are indebted to plaintiff in any sum.
Brannan's Negotiable Instrument Law, 4 ed. (1926), sec. 51: "The holder of a negotiable instrument may sue thereon in his own name; and payment to him in due course discharges the instrument." This is the exact language of our C. S., 3032. In construing this section, the learned author, at p. 352, says: "Although The Code requires an action to be brought in the name of the real party in interest, yet under sec. 51, N. I. L., a holder even though he be a holder only for collection, may sue in his own name." And on p. 353: "In Third Nat. Bank v. Exum,
Under our Code of Civil Procedure, "Every action must be prosecuted in the name of the real party in interest," etc. C. S., 446.
Construing the sections of the Negotiable Instrument Law referred to with the section under Civil Procedure, that says every action must beprosecuted in the name of the real party in interest, we think C. S., 446, is mandatory and compelling. We think the decision of Bank v. Exum,
Allen, J., in Worth Co. v. Feed Co.,
In Worth Co. v. Feed Co., supra, at p. 342, it is said: "The rule prevails with us, and it is supported by the weight of authority elsewhere, that if a bank discounts a paper and places the amount, less the discount, to the credit of the endorser, with the right to check on it, and reserves the right to charge back the amount if the paper is not paid, by express agreement or one implied from the course of dealing, and not by reason of liability on the endorsement, the bank is an agent for collection and not a purchaser. Packing Co. v. Davis,
The plaintiff contends: (1) That on all the evidence it is entitled to recover on a peremptory instruction in its favor; (2) that it is entitled to recover because the defendant did not introduce evidence of defenses against Kaufman Brothers, the original holders of the paper. We think neither position tenable, under the facts and circumstances of the present action.
"If the bank in truth held the notes for collection, it could not maintain this action. Abrams v. Cureton,
In Finance Co. v. Cotton Mills Co., 187 N.C. at p. 237, it is said: "The fact that the officers of the Finance Company testified that its company is the owner of the note, and they purchased it in due course bona fide for value and before maturity, is not conclusive if the Mills Company should show by facts and circumstances to the contrary. The weight of the evidence, pro and con, was for the jury. . . . (p. 239.) All this and other matters of the dealings between the Finance Company and the Truck Company was more than a scintilla of evidence to go to the jury, its weight is for them to determine on this aspect of the case whether the bank is an agent for collection and not a holder or purchaser in due course."
In the present action the bank introduced the trade acceptance, proved its execution by defendants and endorsement by Kaufman Brothers — this made out a prima facie case, which it was entitled to have submitted to the jury, that plaintiff was the holder or purchaser in due course. The defendants contend that from the facts and circumstances of the case and plaintiff's evidence, there was sufficient evidence, more than a scintilla, for the jury to consider and pass on that the plaintiff bank took the trade acceptance merely as an agent for collection and not as a purchaser or holder in due course.
Some of the facts and circumstances relied on by defendants: The following question was asked of and answered by the vice-president of the plaintiff bank: "Q. It was your custom when you took one of these drafts from Kaufman Brothers to credit them with the net amount, and when the acceptance was not paid at maturity, you reserved the right to charge it back to them, didn't you? Answer: Not necessarily; we usually send out and get a check for it, that is when we want them to take it up." The vice-president of the plaintiff bank also testified as follows: "I do not remember making any inquiry as to the financial standing of the Asheville Candy Company before the purchase of the *7 acceptance, but I looked up their rating afterwards in Dun's and found them to be well rated."
Defendants contend that this evidence is sufficient to show that the bank was not making an outright purchase of the trade acceptance, but was handling it as an agent for collection for the convenience of Kaufman Brothers; that the usual course of dealing between the bank and Kaufman Brothers was to take a paper of this character, collect it if possible, and if the paper for any reason was not paid, to return it to Kaufman Brothers and charge it bank or collect it from Kaufman Brothers as a matter of course, not by reason of the endorsement, but as a matter of custom and general course of dealing; so that if the paper was paid, no further entries need be made and no further charges against Kaufman Brothers. In addition, it is a strong circumstance that the bank in Columbus, Georgia, did not make any investigation of the affairs of a concern in Asheville before taking the paper. Ordinary prudence would have dictated that the bank make an investigation of a concern whose paper it was buying, and contends that no bank would buy outright paper of a concern in a distant city and state without making an investigation of the concern for the purpose of ascertaining if the paper was good. This kind of evidence tended to show that the plaintiff bank did not purchase the paper outright, but took it merely as an agent for collection for Kaufman Brothers. There were other circumstances connected with the transaction favorable to defendants' view. We think the evidence, under all the facts and circumstances of this case, sufficient to be submitted to the jury and borne out by decisions in similar cases: Worth Co. v. Feed Co.,
The burden of the issue was on plaintiff, and the court below so charged correctly. Cotton Oil Co. v. R. R.,
"Where the instruction is proper so far as it goes, a party desiring a more specific instruction must request it." See N.C. cases Anno. 10 S.E. Digest (N.C. ed.), sec. 256, p. 12551; Simmons v. Davenport,
The jury, under proper instructions, found for the defendant. They heard the evidence and found that plaintiff was not the owner of the trade acceptance in due course. On the whole record, we can find
No error.