Heyward-Williams Co. v. Zeigler

• Decision Date: 10 February 1917
• Docket Number: 9620.
• Parties: HEYWARD-WILLIAMS CO. v. ZEIGLER ET AL.
• Court: South Carolina Supreme Court

91 S.E. 298

106 S.C. 425

HEYWARD-WILLIAMS CO. v. ZEIGLER ET AL.

No. 9620.

Supreme Court of South Carolina

February 10, 1917

Appeal from Common Pleas Circuit Court of Barnwell County; Wayne F Rice, Judge.

Action by the Heyward-Williams Company against P.J. Zeigler and another. Judgment for plaintiff, and defendants appeal. Reversed and remanded for a new trial.

Jas. M Patterson and R. P. Searson, Jr., both of Allendale, for appellants.

C. B Searson and J. W. Vincent, both of Hampton, and Jas. A Willis, of Barnwell, for respondent.

GARY C.J.

This is an action on three promissory notes executed by the defendants, on the 9th day of March, 1914, in the respective sums of $801.90, $1,055, and $1,000, payable to the plaintiff. On the same day the plaintiff addressed to the defendants a proposed contract, which was accepted by them, as appears by the following indorsement thereon:

"Your offer is hereby accepted upon the terms and conditions in this contract.

Mrs. Virginia S. Zeigler.

P. J. Zeigler."

The contract contains the following provisions:

(1) "For the season ending May 1, 1914, we will ship to you upon the terms and conditions stated herein * * * the following specifically named amounts and kinds of fertilizer * * * to be settled for, by your note or notes, as sent you. * * *"

(2) "On May 1st, next, or prior thereto, on demand, you agree to deliver to us or upon your order, notes of the planters or other purchasers to whom you may have sold these goods or any of them, for the gross amount of the sale of same, to be held by us as collateral security, for the payment of your obligations, as above stated; in the meanwhile, all said goods, notes or proceeds thereof are to be held in trust by you as collateral security for the payment of your notes to us, until all your obligations have been settled, and are to be subject at all times to our order; it is expressly agreed that all cash proceeds, from any of said notes or goods as collected, shall be immediately applied to your obligations to us, whether same shall have matured or not. * * *"

(11) "This contract, written and printed, constitutes the entire agreement, and no verbal understanding will be recognized, and this contract is made subject to approval indorsed thereon, at our office in Savannah, Ga."

The contract shows that the plaintiff's approval was accordingly indorsed thereon. The defendants rely upon the following facts as a defense: That the notes in suit were executed by them in compliance with the terms of said contract. That in accordance with the second clause of the contract, the defendants sent to the plaintiff the notes and mortgage on the cotton crops of those planters, who purchased fertilizers from them. That during the latter part of August, and up to the 15th of September, 1914, said planters delivered to these defendants 53 bales of cotton, covered by said mortgages, to be applied to the notes and mortgages of said planters; and, by agreement, said cotton was sold by the plaintiff on the 14th of September, 1914, for $2,030, which cotton, they allege, the plaintiff well knew belonged to said planters, whose notes and mortgages were then held by the plaintiff as collateral security for the payment of the notes in question. That the said cotton was by operation of law applicable to the payment of said mortgages, and was by the terms of the contract applicable to the notes in suit instead of the individual indebtedness of P.J. Zeigler.

At the close of the testimony the plaintiff made a motion for the direction of a verdict on the following ground:

"That the defense attempted to set up, by the defendants, based upon the contention that the proceeds of the sales of the cotton should have been applied to the notes sued on, in this action is not sound, and the said proceeds have been credited on one of the notes of P.J. Zeigler, which credit the plaintiff had the right to make."

His honor, the presiding judge, granted the plaintiff's motion, and the defendants appealed. The motion to direct a verdict on the ground therein stated was, in effect, a demurrer on the ground that the allegations of the answer were not sufficient to constitute a defense. The respondent's attorneys say:

" The evidence, we submit, shows that the cotton was shipped by P.J. Zeigler, as an individual, and as he owed the plaintiff on other notes the plaintiff had the right, in the absence of direction from him, to apply the credit for the cotton to whichever note the plaintiff saw fit."

Their proposition is thus stated in a different form:

"The defendant P.J. Zeigler is a maker of the notes. He owed another note to the plaintiff, which was his note alone, without any directions, and without any connection with Virginia S. Zeigler, the plaintiff had the right to assume that the cotton was the individual cotton of P.J. Zeigler, and to credit any debt owing by him with the proceeds of sale."

The provision in the contract that "it is...