Opinion · Supreme Court of North Carolina

Bank of Newbern v. Pugh

Bank of Newbern v. Pugh, 8 N.C. 198 (N.C. 1820)

Type: Opinion
Court: Supreme Court of North Carolina
Jurisdiction: North Carolina
Date: 1820-12-05
Topic: general

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Cited by: 9 opinions

BANKv. PUGH,8 N.C. 198(1820)

BANK OF NEW BERN v. PUGH.

Supreme Court of North Carolina

December Term, 1820.

1. A. being indebted to the plaintiffs, came to an agreement with them that he should make a sale on credit and take bonds payable to the plaintiffs, of which the bank would take such as might be approved in payment of its debt. A sale was accordingly made by A., who gave notice of the kind of bonds required, and he took from P., for his purchases, a bond payable to the plaintiffs, which was offered to the bank and refused as a payment and returned to A. to proceed on as he might think proper.Held, that by this agreement A. became the agent of the bank to take and receive the delivery of the bond from P., and that the bond, by the delivery to A., was therefore complete.Held further, that the subsequent refusal of the bank to give A. credit for it was not an attempt to undo the delivery and avoid the bond.Held further, that if such attempt had been made, it would be ineffectual, for if an obligee once accept a bond he cannot afterwards disagree to it so as to make it void.

2. It seems that, without any previous agreement between the bank and A., this was the bond of P., because the plaintiffs had never rejected itin toto.Held further, that it is the province of the jury to decide, not only on the veracity and credit of the witnesses, but also on what facts are proved by their testimony; and it is error in the court to direct the jury to infer one fact from another.Quere, Can the Bank of New Bern take a bond payable directly to itself? It seems that it may, for a debt due to itself.

THIS was an action of debt upon a sealed note. Plea,non est factum. From PITT. Upon the trial the plaintiffs gave in evidence the note, of which the following is a copy:

"Six months after date, we promise to pay to the president and directors of the Bank of New Bern thirty-one hundred and five dollars, for value received; to which payment we bind ourselves and our heirs. This 5 March, 1818. — $3,105.

JOHN ALLEN. (Seal.) WILLIAM PUGH. (Seal.)"

The plaintiffs proved the signature of "William Pugh" to be that of the defendant. The defendant then proved by M. C. Stephens, the cashier of the bank, that the said note was (199) offered to the bank by John Mooring for discount, in lieu and payment of one of David Smith, the intestate of said Mooring, for a like amount, and that the bank did not accept it when so offered. Upon his cross-examination, he further provedPage 99that Smith was, at the time of his death, a large debtor to the bank, and that the president and directors had authorized his administrator, the said Mooring, to take bonds with approved sureties from the purchasers at the sale of Smith's effects, payable to the said president and directors, and had agreed with Mooring to receive such of those bonds as they should approve, in payment of David Smith's note to them; that the bond now sued on was one of those taken in pursuance of such authority and agreement; but the bank, doubting its sufficiency, would not accept it in payment, and that the cashier returned it to Mooring, to be proceeded on as he might think proper. This witness likewise stated (the same being objected to by the plaintiffs) that the president and directors had not, to his knowledge, in express terms, either verbally or in writing, directed this suit to be brought, or authorized Mooring to sue on the note in their name; but they were privy to the suit, and were actually indulging Mooring for a portion of his intestate's debt, awaiting the result of this suit, which was carried on by him for his own benefit.

It was further proved on the part of the plaintiffs that it was made an express condition, at the time of the sale of David Smith's effects by Mooring, that the purchasers should give bonds, with security to be approved by him, in the form of that now sued on.

It was further offered to be proved that, since the note was returned to Mooring, he exhibited it to the defendant, who, with a knowledge of these circumstances, offered to give another bond. This last evidence was rejected by the court.

The court charged the jury that, if they believed the evidence of Stephens, the paper writing had not been received by the plaintiffs, or by any one under their authority, as the (200) bond of the defendant; and, therefore, that it was not the deed of Pugh. The jury found accordingly; and plaintiffs moved for a new trial, because the court misdirected the jury, and because the court admitted improper testimony, and because the court rejected proper testimony. But the motion was refused and judgment given for the defendant, from which the plaintiffs appealed to this Court.

Gastonfor the plaintiffs.

TAYLOR, C. J.

This principal question in this case (204) relates to the delivery of the bond, as to which the evidence is that the bank authorized Mooring to take bonds, payable to the president and directors, reserving to itself the right of receiving such as it should approve in payment of Smith's debt. InPage 100pursuance of this authority, the bond was taken; and it appears to me that the delivery was complete and irrevocable from (205) the moment it was delivered to Mooring. The language of the books is clearly to this effect. A deed may be delivered to the party himself, to whom it is made, or to any other person by sufficient authority from him, or it may be delivered to a stranger for and on behalf of him to whom it is made, without authority. Shep. Touch., 56. It is true that the bank afterwards refused to accept it in payment of Smith's debt, and returned it to Mooring to be proceeded with as he might think fit. The evident meaning of this was that the bank did not think proper to relinquish the security which it already had, for the sake of one which it deemed weaker, but allowed Mooring to proceed and recover the money from the obligor, if he could. This did not amount to even an attempt to undo the delivery. But if it had been accompanied with even the strongest declaration to that effect, it could not have been effectual; for when the obligee once by his agreement has made the deed good, he cannot afterwards by his disagreement make it void. Shep. Touch., 68. An opposite doctrine would be pregnant with mischiefs; and in this very case all the bonds not selected by the bank must become void, though taken by its authority and with full notice to the purchasers that they were to be so taken. As there must be a new trial, and as the whole record is not now before us, I will abstain at this time from giving any decisive opinion on the other points which have been discussed in the argument. It is possible that, upon a more attentive consideration of the subject, I may doubt the right of the bank to take a bond for a debt due to itself; but from every aspect in which I have yet seen the question, and from frequent perusals of the act creating the corporation, the strong impression on my mind is that the bank may, for debts due to itself, take securities of any form or denomination recognized by law, particularly bonds, bills or notes. Act of Assembly 1804, secs. 5, 7, 11, 12. Whether the bank can take all or any of these securities for debts not due to (206) itself, but merely as a trustee, is a question on which I have not formed an opinion, nor should I willingly pronounce it if I had, until the pleadings shall be amended.

HENDERSON, J.

I agree entirely with the Chief Justice in the very satisfactory opinion which he has given; and I go further and say that a new trial ought to be granted, even if the previous agreement had not been made, unless the jury were of opinion that the bank hadin totorejected the bond. In that case it would want an essential part of all contracts — the assent of bothPage 101parties. But it is quite probable, from the evidence, that the jury, if properly instructed, and if their attention had been called to the question, would have been of opinion that the bank only rejected itas acredit to Mooring, and did not intend entirely to annul it; for all declarations or words or signs must be judged of by the intent. The manner in which the judge instructed the jury is, to me, also sufficient to warrant a new trial. He charged the jury that, if they believed the testimony of Stephens, they should find the paper-writing not to be the deed of the defendant. Now,whatMr. Stephens' testimonyproved was a thingon which he could not decide;that belonged to the jury. In the opinion of the court, it might prove a total rejection of the bond, while in that of the jury only the qualified andsub modorejection just spoken of. The nature of the rejection is an inference of fact to be drawn from the evidence, which the judge has improperly drawn for himself and the jury both, leaving to the latter only to say whether the witness swore truly or not. The jury are the constitutional judges, not only of the truth of testimony, but of the conclusions offactresulting therefrom. I would repel the interference of juries, as far as the law will warrant, in all questions of law, and in like manner the interference of the judge in matters of fact.

With regard to the objection raised in the argument in (207) this Court, that the bond is void because it is not a subject of traffic allowed by the charter of the bank, unless under special circumstances, those the plaintiffs must show in the declaration, and prove, and need not be pleaded. I do not think it would be proper to decide on it on this record; for the pleadings are very defectively stated, and the point is for the first time agitated.Non constat, but that the plaintiffs can (if at all necessary) bring this bond within its capacity to take according to the terms of the charter; and, on the other hand, should it be necessary to plead it, that object cannot be effected in this Court, which can make no amendment.

JUDGE HALL concurred with his brethren; and

BY THE WHOLE COURT. Let a new trial be ordered, with leave to the plaintiffs to amend the declaration in any way they may think proper, and to the defendant to pleadde novo.Cited: Moore v. Collins,14 N.C. 134;Morrow v. Alexander,24 N.C. 392;S. v. Daniels,134 N.C. 678;S. v. Turnage,138 N.C. 570;S. v.Garland, ib., 683;S. v. Simmons,143 N.C. 617;S. v. Godwin,145 N.C. 463;S. v. R. R., ib., 571;S. v. R. R.,149 N.C. 513.Page 102