Knight v. Braswell

70 N.C. 709 | N.C. | 1874

Bynum, J.

This is a civil action begun the the 27th of March, 1873, on a bond, of which the following is a copy, to wit:

“ With interest from date, the interest to be paid annually,we promise to pay Joseph A. Englehart, Clerk and Master in Equity for Edgecombe county, five hundred and sixteen dollars and sixty-eight cents, tor value received, this 28th day of May, 1860.”

The defendant, Braswell, is one of the sureties thereon, and in his answer relies, 1. On a want of demand made before action, and 2. On the statute of limitations barring actions against sureties after three years. C. O. P., secs. 31 and 34. The defendant’s counsel relies upon the words in the bond, “the interest to be paid annually,” as constituting a covenant of loan for one year at least, and so from year to year, until the contract is terminated by notice and demand. No authority is cited for this construction, ana in the absence of any express provision in the bond to that effect, the Court must give it that obvious and natural construction which its wording implies, to wit, that it due and payable from date, but if pay- ' ment is postponed for one year or more, then the interest shall be annually due and collectable. The covenant is inserted for the benefit of the covenantee and is not to be construed to his prej udice.

This construction of the bond disposes also of the second defence, to wit, the statute of limitations; for, as the cause of action accrued before the C. C. P. went into effect, the 16th section of the Code expressly saves this and like cases from the operation of sections 31 and 3i of the Code, which bars actions against sureties after three years.

But the defendant says, if this be so, yet a part of the plaintiff’s demand comes within the operation of the statute and is barred ; for that in Bledsoe v. Uixon, 69 N. C. Rep. 89, it is held that when there is an agreement set out in the note for the payment of interest annually or semi-annually, the maker is chargeable with interest at the like rate upon each deferred payment of interest in like manner as if he had given a promissory note for the same amount; and that therefore here such annual accretion of interest becomes a separate cause of action, and it was error in the Court under this plea to render judgment upon the deferred payments of interest which accrued after the Code went into effect and more than three years before action begun.

In this case his Honor gave judgment by computing interest upon the note and adding thereto the interest upon each deferred payment of interest.

In this there is no error. There is but one contract and that is evidenced by the bond wdiich covenants to pay interest annually. Interest is an incident of the debt — a parcel of the bond — and partakes of its nature and therefore is barred by the same lapse of time only which bars an action on the bond out of which it arises.

It has been repeatedly held that coupons, though cut off from the bonds and put in circulation as other negotiable securities, still retain the dignity of the bonds from which they were separated, and an action upon them is barred only as an. action upon the bonds themselves. The City v. Lamson, 9 Wall, 483; City of Lexington v. Butler, 14 Wall, 282.

The ruling of his Honor upon both points is therefore sustained. .

Pee Cueiah. Judgment affirmed.