137 S.E. 593 | N.C. | 1927
Civil action to recover a deposit of $300,000, and to hold the defendants liable for the payment thereof, first, by reason of the official bond, in the penal sum of $25,000, given by the financial agent of Greene County with the Fidelity and Deposit Company of Maryland as surety thereon, and, second, because of the following terms contained in a surety bond, given for the full amount of said deposit and duly signed by the individual defendants, appellants herein:
"The condition of this bond is such that, whereas the North Carolina State Highway Commission has on deposit in the First National Bank of Snow Hill, North Carolina, the sum of three hundred thousand dollars ($300,000), and we, the undersigned, jointly and severally undertake, promise, and agree to save harmless, in all respects, the North Carolina State Highway Commission, because and on account of any deposit that has been, is now on deposit, or may hereafter be made with the First National Bank of Snow Hill, North Carolina, and we hereby guarantee unto the said North Carolina State Highway Commission the *525 payment, upon demand, of any funds of the North Carolina State Highway Commission now deposited in the First National Bank of Snow Hill, North Carolina, or that may hereafter be deposited therein by the North Carolina State Highway Commission, or any authorized officer thereof, it being the purpose and intention of the undersigned, by these presents, to bind ourselves, and each of them jointly and severally, to the payment of any funds now on deposit, or that may hereafter be put on deposit in the First National Bank of Snow Hill, North Carolina, by the North Carolina State Highway Commission."
The facts are that on 29 November, 1922, the commissioners of Greene County placed to the credit of the State Highway Commission, in the First National Bank of Snow Hill, the sum of $300,000, to be used in the construction of certain roads in said county. A month later, as appears from the date of the bond, the State Highway Commission caused the said First National Bank of Snow Hill to have prepared and executed the bond aforesaid, and delivered to it as a protection against loss on account of or by reason of said deposit.
Later, the First National Bank of Snow Hill, by action of its directors, went out of business, and the Bank of Greene was organized and took over all of its assets and assumed all of its liabilities.
In July, 1925, the State Highway Commission and the county of Greene entered into an agreement whereby the State Highway Commission was relieved of its obligation to build said roads as aforesaid, and the commission thereupon returned or transferred and assigned to the county of Greene the deposit above mentioned, and, at the same time, by written memorandum, duly transferred and assigned to the county of Greene the bond executed by the individual defendants as a protection against loss on account of or by reason of said deposit as aforesaid. In August following, the county made demand upon the Bank of Greene, successor to the First National Bank, for the said deposit, and accrued interest thereon, but the bank failed and refused to make payment. This suit is to enforce collection.
It is further alleged that the Bank of Greene is utterly insolvent; that the First National Bank of Snow Hill no longer exists; and that the directors of the Bank of Greene "are all, or in large part, the same as the sureties on the special bond hereinbefore set forth," etc.
From a judgment sustaining the demurrer interposed by the Fidelity and Deposit Company of Maryland (presumably ore tenus, as the record discloses no written demurrer by said defendant, though reference is made in the judgment to "the demurrer of the Fidelity and Deposit Company of Maryland herein filed"), and overruling the written demurrer filed by the individual defendants, the said individual defendants appeal, assigning error. *526 after stating the case: The answer to the question raised by the demurrer of the individual defendants depends upon whether the bond signed by them is one of strict suretyship, specially limited to the State Highway Commission, and therefore nonassignable, or whether it is a general guaranty of payment, assignable with the transfer of the deposit it was given to secure.
We concur in the view taken by the trial court, that the bond in question partakes of the nature of a general guaranty of payment, and is assignable with the debt it was given to secure. 2 Rawle C. L., 593-601; TrustCo. v. Construction Co.,
Speaking of the distinction between a guaranty of payment and a guaranty of collection in Cowan v. Roberts,
It would seem that the conversion of the First National Bank of Snow Hill into the Bank of Greene, viewing the allegations of the complaint in this respect as true, did not destroy or affect the guaranty of the individual defendants so far as their liability had become fixed at the time when the First National Bank of Snow Hill gave up its charter *527
under the national law and assumed the status of a State bank under the State law. City Nat. Bank of Poughkeepsie v. Phelps,
It will be observed that in the latter part of the "condition" of the bond, as above set out, the parties themselves undertake to place an interpretation upon its meaning, "it being the purpose and intent of the undersigned, by these presents, to bind ourselves, and each of them jointly and severally to the payment of any funds now on deposit, or that may hereafter be put on deposit in the First National Bank of Snow Hill, North Carolina, by the North Carolina Highway Commission," which would seem to import without doubt a general guaranty of payment, and it is the general rule of construction that where, from the language employed in a contract, a question of doubtful meaning arises, and it appears that the parties themselves have interpreted their contract, practically or otherwise, the courts will ordinarily follow such interpretation, for it is to be presumed that the parties to a contract know best what was meant by its terms, and are least liable to be mistaken as to its purpose and intent. Wearn v. R.R.,
The liability of the individual defendants, we apprehend, is not affected by the fact that the bond in suit was not signed by the principal, though this question was not debated on the argument, nor is it discussed in the briefs. Clark v. Bank of Hennessey,
We forego any further discussion of the case, as it is here on demurrer, and the defendants have not yet answered. They may plead, for aught we know, that the bond in suit was intended to be personal to the State Highway Commission, and ask for a reformation in its terms. Stillman v.Northrup,
It follows, therefore, from what is said above, that the demurrer interposed by the appealing defendants was properly overruled. Mudge v.Varner,
Affirmed.