Murchison Nat. Bank v. Evans
| Decision Date | 07 April 1926 |
| Docket Number | 289. |
| Parties | MURCHISON NAT. BANK v. EVANS et al. |
| Court | North Carolina Supreme Court |
Appeal from Superior Court, New Hanover County; Daniels, Judge.
Action by the Murchison National Bank against T. C. Evans and others. From an order of reference, defendants except and appeal. Affirmed.
Statutes relating to trial by referees must be liberally construed.
On the 16th day of September, 1924, the Bank of Maxton executed and delivered to the plaintiff two promissory notes aggregating $15,000, payable on demand. Prior to the delivery of said notes they were duly indorsed by the defendants. At the time of the delivery of said notes the Bank of Maxton was indebted to the plaintiff upon certain other notes in a sum in excess of $150,000, said indebtedness being secured by certain bills and notes receivable, which had been executed and delivered to the Bank of Maxton and hypothecated by said bank with the plaintiff as collateral security for the payment of money borrowed by said bank from the plaintiff. At the time of delivery to the plaintiff of the notes indorsed by the defendants there was an understanding between the parties that if said bank of Maxton had any equity in the bills notes, and other collateral, which had been pledged by it to the plaintiff for the payment of the $150,000 indebtedness then such equity should be considered as security for the payment of the notes indorsed by defendants.
On October 3, 1924, the Bank of Maxton executed and delivered to the plaintiff its promissory note for $10,000, which said note was duly indorsed by the defendants before delivery to the plaintiff. As security for the payment of said note the Bank of Maxton hypothecated with the plaintiff 52 notes of various parties, ranging from $75 to $700. The plaintiff alleged that there was a credit of $1,892.52 derived from collections made by it on the collateral specified, and that all the collateral had been exhausted, and, as the notes were long past due, plaintiff demanded judgment against the defendants, and, further, that the securities held by plaintiff for the payment of the said note should be sold by a commissioner for the purpose of applying the proceeds to the liquidation of said note.
The defendants admitted the indorsement of said notes, alleging that their said indorsement was for the accommodation of the Bank of Maxton, and that their liability, if any thereon, was contingent, and, further, that such collections as may have been made on the evidences of debt were not correctly stated in plaintiff's complaint, and that, as they are advised informed, and believe, much more money has been collected and much more money should be credited to the Bank of Maxton which would relieve the liability of defendants accordingly than is set out in the complaint; and these defendants ask that plaintiff be required to make a full statement showing all collections made, not only on the evidence of debt set out in the complaint, but from all securities held by it at the time when a receiver was appointed by the Bank of Maxton, and through and by whom such collections were made, together with the cost and expense thereof. The defendant further alleged that the security in addition to that listed in the complaint was greatly in excess of the note set out in the complaint, and that the plaintiff has other property of value upon which considerable sums can be realized. The defendant further alleged:
"That, as defendants are advised and believe, the said account should be revised and corrected, and the plaintiff should be required by the court to submit a full statement in detail of all such charges, not only for the benefit of these creditors, but also for the benefit of other creditors of the Bank of Maxton."
The defendants in their answer, while admitting the indorsement of the notes, allege, in substance, that their liability is contingent for the reason that sufficient security was pledged by the Bank of Maxton with the plaintiff to pay said notes under the agreement and therefore relieve the defendants of liability on said indorsement. And there are further allegations in the answer of waste and mismanagement on the part of plaintiff in handling said securities, the various aspects of the contention being contained in the 42 allegations of the answer.
After the pleadings were read, Daniels, J., being of the opinion that the cause involved the taking of a long and complicated account, referred the case to D. H. Bland with direction to take the testimony and find the facts upon all issues of fact raised by the pleadings and to report his findings with his conclusions of law arising thereon to the next term of court.
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