Lowe v. Jackson, 668

• Decision Date: 29 January 1965
• Docket Number: No. 668,668
• Citation: 263 N.C. 634,140 S.E.2d 1
• Parties: Claude LOWE and wife, Lela Lowe, Porter Lowe and wife, Hallie Lowe, v. W. M. JACKSON, Trustee, and David L. Hiatt, Substitute Trustee, for J. Anderson Whitaker.
• Court: North Carolina Supreme Court

Page 1

140 S.E.2d 1

263 N.C. 634

Claude LOWE and wife, Lela Lowe, Porter Lowe and wife, Hallie Lowe, v. W. M. JACKSON, Trustee, and David L. Hiatt, Substitute Trustee, for J. Anderson Whitaker.

No. 668.

Supreme Court of North Carolina.

Jan. 29, 1965.

Blalock & Swanson and C. Orville Light, Pilot Mountain, for plaintiff appellees.

Hiatt & Hiatt, Mount Airy, for defendant appellants.

DENNY, Chief Justice.

Since there is no exception to the findings of fact, the appeal presents only these question: (1) Do the facts found support the judgment, and (2) does any error of law appear upon the face of the record? Taney v. Brown, 262 N.C. 438, 137 S.E.2d 827; Dellinger v. Bollinger, 242 N.C. 696, 89 S.E.2d 592.

"Novation' may be defined as a substitution of a new contract or obligation for an old one which is thereby extinguished. * * * The essential requisites of a novation are a previous valid obligation, the agreement of all the parties to the new contract, the extinguishment of the old contract, and the validity of the new contract. * * *' 66 C.J.S. Novation §§ 1 and 3 cited in Tomberlin v. Long, 250 N.C. 640, 109 S.E.2d 365.

'Novation implies the extinguishment of one obligation by the substitution of another.' Walters v. Rogers, 198 N.C. 210, 151 S.E. 188.

It is well settled that where the language of a contract is plain and unambiguous, it is for the court and not the jury to declare its meaning and effect. Stewart v. McDade, 256 N.C. 630, 124 S.E.2d 822; Eastern Steel Products Corp. v. Chestnutt, 252 N.C. 269, 113 S.E.2d 587.

There is nothing in the agreement executed by Porter Lowe that tends to show an intention on his part to do anything more than to assume the indebtedness outstanding against the property he purchased from his co-plaintiffs.

'* * * (A) debt assumption agreement by the purchaser of the equity of redemption is not a novation of the mortgage note, there being no element of a further consideration passing between the parties or a substitution of a new for an old or subsisting debt. As between the mortgagor and his grantee assuming the debt, the mortgagor is a surety. But as between the mortgagor and the mortgagee he remains primarily liable for the mortgage debt when the mortgagee does not accept or rely upon the debt assumption agreement, even though the mortgagee accepts from the purchaser of the equity partial payments on the note and extends the time of payment without notice to the mortgagor. And the mortgagee, upon default may either sue in rem by foreclosure, or in personam on the note against the mortgagor and against the purchaser of the equity of redemption on the contract made for the mortgagee's benefit. * * *' Strong's North Carolina Index, Vol. 3, Mortgages and Deeds of Trust, § 15; Federal Land Bank of Columbia v. Whitehurst, 203 N.C. 302, 165 S.E. 793; Brown...