Dixie Grocery Co., Inc. v. Hoyle

• Decision Date: 25 January 1933
• Docket Number: 534.
• Citation: 167 S.E. 469,204 N.C. 109
• Parties: DIXIE GROCERY CO., Inc., et al. v. HOYLE et al.
• Court: North Carolina Supreme Court

167 S.E. 469

204 N.C. 109

DIXIE GROCERY CO., Inc., et al. v. HOYLE et al.

No. 534.

Supreme Court of North Carolina

January 25, 1933

Appeal from Superior Court, Lincoln County; Schenck, Judge.

Action by the Dixie Grocery Company, Incorporated, and others against J. W. Hoyle, trustee, and another, who filed a cross-action. From judgment for defendants, plaintiffs appeal.

Affirmed. This is a civil action instituted by plaintiffs to perpetually enjoin defendants from exercising the right to foreclose two certain deeds of trust, set out in the record. A jury trial was waived, and it was heard by the court upon an agreed statement of facts.

The facts stated by defendants in their brief are substantially correct, and are as follows: "The two deeds of trust are in the usual form and almost identical except as to dates and amounts secured. Each conveys the same 109 acres of land, as security for the several notes under seal. The first deed of trust was executed by O. M. Hartsoe and D. P. Hartsoe and their wives, September 6, 1911, to secure a note under seal for $500.00, due September 8, 1911. The second deed of trust was executed by the same parties, October 16, 1911, to secure a note under seal for $400.00, due October 20, 1911. The two deeds of trust were executed to J. W. Hoyle, trustee for L W. Hoyle, and the notes were, each, payable to L. W. Hoyle. It is admitted that L. W. Hoyle is dead and that his duly qualified administrator transferred and assigned the two notes to defendant, Mrs. D. E. Sorrells, who has since been the legal owner and holder of the notes. It is admitted that the annual interest has been paid on each of the two notes by the makers, up to October 20, 1929, and October 7th, 1929 respectively. The answer admits that on December 8, 1922, D. P. and O. M. Hartsoe, who had previously held the 109 acres, conveyed as security for the payment of the Hoyle notes, made division of the land between themselves, and that each executed division deeds to the other for the one-half of said land. On April 11, 1923, thereafter, D. P. Hartsoe executed a deed of trust on his half to the First Carolina Joint Stock Land Bank of Columbia, which was foreclosed on February 8, 1932, and the defendant, Dixie Grocery Company, was the purchaser and took deed therefor. On August 31, 1929, O. M. Hartsoe executed a mortgage on his half to the Federal Land Bank of Columbia, to secure a loan of $1,000.00, which is still outstanding. It is admitted that neither the affidavit was registered, nor the marginal entries made on the record of the two deeds of trust, prior to the expiration of fifteen years from the maturity of the Hoyle notes, as provided for in Code 1931, § 2594 (5). All of the conveyances referred to above were duly registered."

After the defendant Mrs. D. E. Sorrells was made party defendant, the Federal Land Bank of Columbia filed an amended complaint. The Dixie Grocery Company and D. P. and O. M. Hartsoe adopted the amended complaint. The following is in the amended complaint: "The Federal Land Bank of Columbia, Inc., hereby pleads the statute of limitations in such cases made and provided for, to-wit, section 437, subsection 3, and section 2589 of the Consolidated Statutes of North Carolina, respectively, in bar of any right to make such application, order or direction to the said John W. Hoyle, trustee as aforesaid, or his successors in trust as the said defendant, Mrs. Dora E. Sorrells, her heirs, assigns, administrators, executors, agents, servants, representatives or attorneys, may claim."

On the record the following facts are admitted: "That the foregoing entries of payments (set out in the record) were, on the 25th day of January, 1932, entered upon the record of said deed of trust in Book 108, page 5, in the office of the Register of Deeds of Lincoln County, together with the following additional entry: 'The principal of $500.00, together with interest thereon from October 20th, 1929, to date, is now due and payable on the note secured by this deed of trust.' Signed: Mrs. D. E. Sorrells, Assignee of M. H. Hoyle, Admr. of L. W. Hoyle, Decd., witness: W. H. Boring, Register of Deeds. That the foregoing entries of payments (set out in the record) were on the 20th day of January, 1932, entered upon the record of said deed of trust in Book 108, page 8, in the office of Register of Deeds of Lincoln County, together with the following additional entry: 'The principal of $400.00, together with interest thereon from October 7th, 1929, to date, is now due and payable on the note secured by this deed of trust.' Signed: Mrs. D. E. Sorrells, Assignee of M. H. Hoyle, Admr.; of L. W. Hoyle, Decd.; witness W. H. Boring, Register of Deeds."

Upon these facts, the court was of the opinion that the plaintiffs were not entitled to the relief sought, and further that the defendants were entitled to the relief demanded in their cross-action, and entered the judgment, as it appears in the record, from which plaintiffs made numerous exceptions and assignments of error and appealed to the Supreme Court.

S. M. Roper and A. L. Quickel, both of Lincolnton, for appellants.

W. H. Childs and W. A. Dennis, both of Lincolnton, for appellee Federal Land Bank of Columbia, Inc.

Kemp B. Nixon, of Lincolnton, for appellees Dixie Grocery Co., Inc., D. P. Hartsoe, and O. M. Hartsoe.

CLARKSON J.

The questions involved: Does the Act of the General Assembly, Public Laws of 1923, chap. 192, § 1, N.C. Code 1931 (Michie) § 2594(5), conclusively presume the payment of the two notes in question of date September 6, 1911, maturity date September 8, 1911, and the note dated October 16, 1911, maturity date October 20, 1911, when the holder of the said notes did not comply with the provisions of the aforesaid act prior to January 25, 1932, being the date agreed upon as the time when the marginal records in the office of the register of deeds, Lincoln county, N. C., showing the interest payment, etc., as set out in the agreed statement of facts in this case? We think not from the facts and circumstances of this case.

The pertinent part of the statute to be considered is section 2594(5), supra, which in part is as follows: "The conditions of every mortgage, deed of trust, or other instrument securing the payment of money shall be conclusively presumed to have been complied with or the debts secured thereby paid as against creditors or purchasers for a...