Fry v. Pomona Mills, Inc.

• Decision Date: 20 June 1934
• Docket Number: 522.
• Parties: FRY et al. v. POMONA MILLS, Inc., et al.
• Court: North Carolina Supreme Court

175 S.E. 156

206 N.C. 768

FRY et al. v. POMONA MILLS, Inc., et al.

No. 522.

Supreme Court of North Carolina

June 20, 1934

Appeal from Superior Court, Guilford County; Clement, Judge.

Action by F. L. Fry, as administrator of the estate of Mrs. Martha L. Williams, deceased, as administrator of the estate of Mrs Mollie E. Fry, deceased, and individually, suing on behalf of himself as such administrator and individually, and on behalf of all other stockholders of the Pomona Mills, Inc., who may come in and make themselves parties to the cause, against the Pomona Mills, Inc., in which action Norman A. Boren was appointed as receiver for defendant, and in which action L C. Vaughan and others intervened as parties plaintiff and made J. E. Latham and others additional defendants. From an order referring to a referee that part of the action between intervening plaintiffs and defendants, all defendants, except defendant G. O. Hunter, appeal.

Affirmed.

This is a civil action pending in the superior court of Guilford county, summons therein having been issued and complaint having been filed on the 13th day of April, 1933. In the original action the only defendant was Pomona Mills, Inc. In that action, the summons and pleadings in which are set out in the record, for reasons stated in the complaint therein Norman A. Boren, Esquire, was duly appointed receiver of said Pomona Mills, Inc., and since the ------- day of April, 1933 has been and now is in charge of said Pomona Mills, Inc., as such receiver. On or about the 29th day of November, 1933, L. C. Vaughan, J. A. Roland, Mrs. J. A. Roland, Meyer Sternberger, Mrs. Nora McCracken, John W. Summers, and Cecil Gant, alleging themselves to be preferred stockholders of said Pomona Mills, Inc., filed their petition in the original action, which petition is set out in the record, praying leave to come in and make themselves parties to said original cause and praying that J. E. Latham, P. C. Rucker, C. W. Causey, J. C. Watkins, G. O. Hunter, and Fielding L. Fry be made parties defendant, along with said Pomona Mills, Inc., and Norman A. Boren, receiver, in said original action. Thereupon the resident judge of the Twelfth judicial district made and entered in said original action an order allowing the petitioners to come into said action and make themselves parties plaintiff thereto and state their cause of action against said Pomona Mills, Inc., and Norman A. Boren, receiver thereof, and requiring that summons be issued to said J. E. Latham, P. C. Rucker, C. W. Causey, J. C. Watkins, G. O. Hunter, and Fielding L. Fry to the end that they be made parties defendant. Accordingly summons was issued to the additional parties and was served upon all of them except G. O. Hunter, and those served were accordingly set down as additional parties defendant in the original action.

Thereupon petitioners L. C. Vaughan, J. A. Roland, Mrs. J. A. Roland, Meyer Sternberger, Mrs. Nora McCracken, John W. Summers, and Cecil Gant, preferred stockholders, filed their complaint entitled as in the original action with the addition of Norman A. Boren, receiver, J. E. Latham, P. C. Rucker, C. W. Causey, J. C. Watkins, G. O. Hunter, and Fielding L. Fry as parties defendant, which complaint setting out three alleged causes of action, appears in the record. Thereafter and in due time, Norman A. Boren, receiver, filed his separate answer to said complaint and J. E. Latham, P. C. Rucker, C. W. Causey, J. C. Watkins, and Fielding L. Fry filed their answer thereto, which answer is set out in the record. On the 2d day of October, 1933, Hunter Manufacturing & Commission Company commenced a civil action in the superior court of Guilford county against Norman A. Boren, receiver for Pomona Mills, Inc., and on said date filed its complaint. Thereafter and in due time, said Norman A. Boren, receiver, filed his answer to the complaint of Hunter Manufacturing & Commission Company setting up, among other things, counterclaims against said Hunter Manufacturing & Commission Company. Later and in due time said Hunter Manufacturing & Commission Company replied in part to said counterclaims and demurred in part thereto. The demurrer of said Hunter Manufacturing & Commission Company was heard at March term, 1934, of said court and was overruled. At March term, 1934, of said court, the intervening petitioners or plaintiffs L. C. Vaughan, J. A. Roland, Mrs. J. A. Roland, Meyer Sternberger, Mrs. Nora McCracken, John W. Summers, and Cecil Gant through their counsel moved the court that their intervention or the action instituted by them by leave of the court as aforesaid against Pomona Mills, Inc., Norman A. Boren, receiver, J. E. Latham, P. C. Rucker, C. W. Causey, J. C. Watkins, G. O. Hunter, and Fielding L. Fry be referred to a referee for trial. To this motion, defendant Norman A. Boren, receiver, through his counsel and defendants J. E. Latham, P. C. Rucker, C. W. Causey, J. C. Watkins, and Fielding L. Fry excepted and assigned error. To said order, defendant Norman A. Boren, receiver for Pomona Mills, Inc., excepted and assigned errors, demanding a trial by jury of the issues raised upon the pleadings. To the order so signed as aforesaid, defendants J. E. Latham, P. C. Rucker, J. C. Watkins, C. W. Causey, and Fielding L. Fry excepted.

The order of reference is as follows: "This cause being heard, and it appearing to the Court that the trial of this part of the action entitled L. C. Vaughan, J. A. Roland, Mrs. J. A. Roland, Meyer Sternberger, Mrs. Nora McCracken, John W. Summers, and Cecil Gant, Preferred Stockholders, vs. Pomona Mills, Incorporated; Norman A. Boren, Receiver; J. E. Latham, P. C. Rucker, C. W. Causey, J. C. Watkins, G. O. Hunter, and Fielding L. Fry, requires the examination of several long accounts; that the complexity of the pleadings and the number of parties precludes the possibility of a proper and fair representation of the matters at issue to a jury and that it is a proper case for reference, it is ordered that this action, or the part thereof involving the action between the Preferred Stockholders as plaintiffs and the Receiver and the Directors of the Pomona Mills, Incorporated, as defendants, be and it is hereby referred to Henry M. Robins, Esq., of Asheboro, North Carolina, for hearing and the said Referee shall proceed to hear the evidence, and find the facts therefrom, state his conclusions of law, and make his report to this Court as required by law. The said Referee shall fix the time for hearing, notify the parties thereof, determine the matter, and make his report to this Court without unnecessary delay. This March 30, 1934."

From the foregoing order, the defendants J. E. Latham, P. C. Rucker, J. C. Watkins, C. W. Causey, and Fielding L. Fry except and assign, among other errors, the pendency of the civil action entitled Hunter Manufacturing & Commission Company v. Norman A. Boren, Receiver, for Pomona Mills, Inc., pending in this court, and from said order, the said defendants appeal to the Supreme Court in open court. From the foregoing order, the defendant Norman A. Boren, receiver for the Pomona Mills, Inc., excepts and assigns error and demands a trial by jury on the issues raised upon the pleadings and gives notice of appeal to the Supreme Court, in open court.

Hobgood & MacClamrock, of Greensboro, for appellants Latham, Rucker, Causey, Watkins, and Fry.

Brooks, McLendon & Holderness, of Greensboro, for appellant Norman A. Boren, receiver.

Sapp & Sapp, of Greensboro, for appellees.

CLARKSON Justice.

In the order of reference is the following: "This cause being heard, and it appearing to the Court that the trial of this part of the action entitled L. C. Vaughan, J. A. Roland, Mrs. J. A. Roland, Meyer Sternberger, Mrs. Nora McCracken, John W. Summers, and Cecil Gant, Preferred Stockholders, vs. Pomona Mills, Incorporated; Norman A. Boren, Receiver; J. E. Latham, P. C. Rucker, C. W. Causey, J. C. Watkins, G. O. Hunter and Fielding L. Fry, requires the examination of several long accounts; that the complexity of the pleadings and the number of parties precludes the possibility of a proper and fair representation of the matters at issue to a jury and that it is a proper case for reference."

To the above reference, the parties before mentioned excepted, assigned errors, and appealed to this court. We think the reference proper under the facts and circumstances of this case. The Pomona Mills, Inc., was duly placed in the hands of a receiver, Norman A. Boren. The order of reference affects solely parties to the action. N. C. Code 1931 (Michie), § 460, in part is as follows: "The court either between the terms, or at a regular term, according to the nature of the controversy, may determine any controversy before it, when it can be done without prejudice to the right of others, but when a complete determination of the controversy cannot be made without the presence of other parties, the court must cause them to be brought in," etc.

Under an order not appealed from, the defendants J. E. Latham, P. C. Rucker, C. W. Causey, J. C. Watkins, G. O. Hunter, and Fielding L. Fry were made parties to the original action; complaint was duly filed and the defendants above named, with one exception, filed answer to same. Answer was also filed by Norman A. Boren, receiver.

N.C. Code 1931 (Michie), § 507, in part is as follows: "The plaintiff may unite in the same complaint several causes of action, of legal or equitable nature, or both, where they all arise out of-

1. The same transaction, or transaction connected with the same subject of action."

The general rule which may be deduced from the decisions is that if the causes of action be not entirely distinct and unconnected, if they arise out of one...