58 N.C. App. 207 | N.C. Ct. App. | 1982
Since the parties are in substantial agreement regarding the facts of the case, the only question for our consideration is whether the trial court correctly concluded from those facts that petitioner was entitled to summary judgment as a matter of law.
Appellants rely heavily on the opinion of our Supreme Court in Waff Brothers v. Bank of North Carolina, 289 N.C. 198, 221 S.E. 2d 273 (1976), a case similar in some respects to that before us. The Waff Brothers holding gave effect to the intent of the parties to the transfer of indebtedness. If Waff Brothers were controlling, therefore, the petitioner here would prevail since assumption of the bank’s lien by Pitt-Greene clearly was intended by the Lassiters, the bank and Pitt-Greene. However, we find that the case at bar is distinguishable from Waff Brothers in one critical respect. In Waff Brothers, the owner of the encumbered property was not personally liable for the payment of the deed of trust. He paid it as a stranger to the indebtedness and was therefore entitled to preservation of the lien in his favor. Where, as here, a property owner is personally liable to creditor #1 and borrows funds from creditor #3 to pay off #1, he cannot defeat the priority of creditor #2, who is senior to #3, by substituting #3 for #1. Regardless of whether the landowner personally handed the borrowed money to #1 in payment of his obligation, the net result is the same: The original debt is discharged and creditor #l’s lien is extinguished.
We hold that the trial court correctly granted summary judgment in favor of petitioner, Plymouth Fertilizer Company.
Affirmed.