Armstrong Grocery Co. v. Banks

• Decision Date: 07 March 1923
• Docket Number: 157.
• Citation: 116 S.E. 173,185 N.C. 149
• Parties: ARMSTRONG GROCERY CO. v. BANKS ET AL.
• Court: North Carolina Supreme Court

116 S.E. 173

185 N.C. 149

ARMSTRONG GROCERY CO. v. BANKS ET AL.

No. 157.

Supreme Court of North Carolina

March 7, 1923

Appeal from Superior Court, Pamlico County; Calvert, Judge.

Action by the Armstrong Grocery Company against M. Banks and J. N Potter, trading under the firm name of M. Banks & Co., and D P. Casey, trading under the firm name of the Central Garage. From a judgment of the superior court dismissing the action for want of jurisdiction, plaintiff appeals. Reversed.

A court of a justice of the peace has jurisdiction only to administer legal relief, and cannot affirmatively administer equitable remedies, though it may recognize an equity defense invoked in any action properly before it.

Z. V Rawls, of Bayboro, for appellant.

WALKER J.

This is a civil action which was brought in the superior court of Pamlico county for the purpose of obtaining equitable relief against the defendants Potter and Casey, the amount involved being $125.03. His honor, Judge Calvert, at the November term, 1922, of Pamlico superior court, granted the defendants' motion to dismiss for want of jurisdiction.

For two years or more previous to the above action, the defendants M. Banks and J. N. Potter were partners trading under the firm name of M. Banks & Co., and while conducting their partnership business under the firm name of M. Banks & Co. became indebted to plaintiff for goods sold and delivered to the amount of $125.03. On July 1, 1921, the defendant M. Banks assigned to his codefendant J. N. Potter all his interest in said partnership property, alleging it to be for the security of $2,000, the defendant Potter permitting the partnership business to be continuously operated under its original name of M. Banks & Co., it being generally known that the defendant Banks was totally insolvent. The partnership business consisted of the repairing of automobiles and the sale of various supplies and accessories used in the automobile business, including a lot of bolts, hardware, fan belts, and many other automobile supplies carried in stock by the defendant M. Banks & Co. On July 18, 1922, the said defendants M. Banks and J. N. Potter, still trading under the firm name of M. Banks & Co., sold to D. P. Casey all of said partnership effects in bulk, consisting of their entire stock of merchandise, automobile supplies, etc., wthout giving any notice to creditors, as required by law, or otherwise complying with the requirements of the statute.

The plaintiff in this action demands as relief that the transfer by M. Banks to his codefendant Potter of his interest in the said partnership effects be declared void as to their creditors, and that the sale by the defendants M. Banks and J. N. Potter, trading as M. Banks & Co., to the defendant Casey also be declared void, and each of the defendants be held liable for the indebtedness.

This action as to the defendants Potter and Casey is not founded on contract, and if it had been originally started in a court of a justice of the peace that court would have had no jurisdiction. Consol. St. § 1474.

"The jurisdiction of our superior courts is general and not limited, except in the sense that it has been narrowed, from time to time, by carving out a portion of this general jurisdiction and giving it, either exclusively or concurrently, to other courts." Singer Sewing Machine Co. v. Burger, 181 N.C. 247, 107 S.E. 14.

It has never been held here that equitable relief can be administered affirmatively by the court of a justice of the peace. The court of a justice of the peace has no jurisdiction by which it can affirmatively administer an equity (Berry v. Henderson, 102 N.C. 525, 9 S.E 455; Fidelity Co. v. Jordan, 134 N.C. 236, 46 S.E. 496; McAdoo v. Callum, 86 N.C. 419; Lutz v. Thompson, 87 N.C. 334, 337; Levin v. Gladstein, 142 N.C. 482, 55 S.E. 371, 32 L. R. A. (N. S.) 905, 115 Am. St. Rep. 747; Bell v. Howerton, 111 N.C. 69, 15 S.E. 891), though a defendant in a justice's court may set up an equitable defense (Levin v. Gladstein, supra; Lutz v. Thompson, supra), as in such cases a justice has jurisdiction of equitable matters interposed by way of defense in actions properly cognizable upon them (Bell v. Howerton, supra; Garrett v. Love, 89 N.C. 205; Lutz v. Thompson, supra; Stacey Cheese Co. v. Pipkin, 155 N.C. 394, 71 S.E. 442, 37 L. R. A. (N. S.) 606). It has been held in other cases besides those cited by us that, while the court of a justice of the peace is one for the enforcement of remedies merely legal, it may so far recognize an equity involved in any action pending before it as to permit it to be pleaded as a defense. Bell v. Howerton, supra; McAdoo v. Callum, supra; Fidelity Co. v. Jordan, supra. The case of McAdoo v. Callum will illustrate the distinction, in...