Nimocks v. Cape Fear Shingle Co

• Decision Date: 01 March 1892
• Citation: 14 S.E. 622,110 N.C. 20
• Court: North Carolina Supreme Court
• Parties: Nimocks v. Cape Fear Shingle Co.

14 S.E. 622

110 N.C. 20

Nimocks

v.Cape Fear Shingle Co.

Supreme Court of North Carolina.

March 1, 1892.

Judgment by Confession—Validity—Powers of Corporation.

A judgment confessed by a corporation will be set aside where it does not appear that the board of directors sanctioned the order to confess judgment made by a majority of the stockholders at a meeting not regularly called, and where it does not also appear that the clerk indorsed on the statement of the claim, on which the Judgment was founded, and entered on his docket, a judgment of the court for the amount confessed, as required by Code, § 572.

Appeal from superior court, Harnett county; Spier Whitaker, Judge.

Motion by Cape Fear Shingle Company to set aside a judgment confessed by defendant corporation in favor of R. M. Nimocks and A. H. Slocumb. Motion allowed and judgment declared void. Plaintiff Nimocks appeals. Affirmed.

F. H. Busbee, for appellant.

John W. Hinsdale and W. E. Murchison, for appellee.

Merrimon, C. J. A corporation, in or out of term-time of the court, may confess a judgment in favor of a party without action, as allowed by the statute, (Code, §§ 570-572;) but, to do so effectually, the statutory requirements must be strictly observed in all material respects. This method of obtaining judgment is out of the ordinary course of procedure, and subject to abuse. Not infrequently such judgments are made the instrumentality for effectuating fraudulent transactions, and giving fraudulent preferences to particular creditors. To prevent and guard against such mischief, the statute prescribes certain requisites that must be observed, else the judgment will be void. Sharp v. Railroad, 106 N. C. 308, 11 S. E. Rep. 530. Ordinarily, a judgment of this nature will not be set aside for mere irregularities in and about the same, because the judgment i3 confessed, and the party confessing the same must be deemed to have waived irregularities. But if the judgment appears to be void for cause appearing, or failing to appear, upon the record, the court will quash the entry purporting to be a judgment, upon the ground that it improperly appears on the record. It can serve no proper purpose, may mislead interested persons, and it incumbers and defaces the record. In this case, the statement in writing of the claim upon which the judg-ment In question is founded is informal, but it might be treated as sufficient in substance. It does not, however, appear, as it should do, that the directors of the...