Pike v. Wachovia Bank & Trust Co., 766

Decision Date14 June 1968
Docket NumberNo. 766,766
PartiesFloyd S. PIKE v. WACHOVIA BANK AND TRUST COMPANY; R. J. Lovill, Jr.; Henry B. Rowe, Jr.; Gladys W. Lovill; J. Walter Lovill, Jr.; Edward F. Lovill; and Margaret Lovill Martin.
CourtNorth Carolina Supreme Court

Craige, Brawley, Horton & Graham, Winston Salem, and George K. Snow, Mount Airy, for plaintiff.

Womble, Carlyle, Sandridge & Rice, Winston Salem, for defendant Wachovia Bank and Trust Co. Woltz & Faw, for G. C. Lovill Estate.

P. M. Sharpe and Barber, Gardner, & Gardner, Mount Airy, for J. W. Lovill Estate.

BRANCH, Justice.

Appellant assigns as error failure of the court to admit evidence adduced as to one defendant to be considered against all defendants, on the theory that defendants were engaged in a joint adventure so as to constitute each defendant a principal and the agent of the others.

Each member of a joint adventure is both an agent for his co-adventurer and a principal for himself. Summers v. Hoffman, 341 Mich. 686, 69 N.W.2d 198, 48 A.L.R.2d 1033; 48 C.J.S. Joint Adventures § 5, p. 827.

'The terms joint adventure and joint venture are synonymous. 48 C.J.S. Joint Adventures § 1, p. 803.' Bradbury v. Nagelhus, 132 Mont. 417, 319 P.2d 503.

In re Simpson, 222 F.Supp. 904 (M.D.N.C., 1963) defines and discusses the relationship of a joint venture as follows:

"A joint venture is an association of persons with intent, by way of contract, express or implied, to engage in and carry out a single business adventure for joint profit, for which purpose they combine their efforts, property, money, skill, and knowledge, but without creating a partnership in the legal or technical sense of the term. * * *

"Facts showing the joining of funds, property, or labor, in a common purpose to attain a result for the benefit of the parties in which each has a right in some measure to direct the conduct of the other through a necessary fiduciary relation, will justify a finding that a joint adventure exists.'

"To constitute a joint adventure, the parties must combine their property, money, efforts, skill, or knowledge in some common undertaking. The contributions of the respective parties need not be equal or of the same character, but there must be some contribution by each coadventurer of something promotive of the enterprise."

A joint adventure is in the nature of a kind of partnership, and although a partnership and a joint adventure are distinct relationships, they are governed by substantially the same rules. Wiley v. Wirbelauer, 116 N.J.Eq. 39, 174 A. 20; Alexander v. Turner, 139 Neb. 364, 297 N.W. 589; McKee v. Capitol Dairies, 164 Or. 1, 99 P.2d 1013; Easter Oil Corp. v. Strauss (Tex.Civ.App.) 52 S.W.2d 336. The outstanding difference between a partnership and a joint adventure is that the former ordinarily relates to a continuing action. Chisholm v. Gilmer (C.C.A.4th) 81 F.2d 120; Proctor v. Hearne, 100 Fla. 1180, 131 So. 173; Tidewater Constr. Co. v. Monroe County, 107 Fla. 648, 146 So. 209; Reinig v. Nelson, 199 Wis. 482, 227 N.W. 14; Schleicker v. Krier, 218 Wis. 376, 261 N.W. 413.

It is stated in 48 C.J.S. Joint Adventures § 1, p. 806:

'A joint adventure is distinguishable from joint ownership and tenancy in common in that the latter lacks the feature of adventure. So the mere purchase of property by two persons each of whom contributes a portion of the purchase price makes them joint owners of the property, but does not establish between them the relation of joint adventurers, * * * However, the nature of the agreement between parties purchasing land jointly in a transaction for profit may constitute it a joint adventure. A sale of jointly owned property is in no sense a joint adventure.' (Emphasis ours.)

In the case of Johnson v. Watland, 208 Iowa 1370, 227 N.W. 410, landlord Watland and tenant, Rasmussen, operated a farm under an agreement generally known as a 'share crop agreement,' by which the landlord furnished the land, half of the stock, and bore half of the expenses, and the tenant furnished labor, half of the expenses and half of the stock. The profits and increase in stock were shared equally. Watland and Rasmussen offered property, jointly owned by them under the lease, for sale at public auction, which sale was advertised in both of their names. The plaintiff brought action against the maker of a note executed to Watland and Rasmussen for property purchased at the sale. The note was endorsed Watland Rasmussen by Rasmussen. The plaintiff contended that Watland and Rasmussen were liable on the theory that the note was taken in the prosecution of a joint adventure between Watland and Rasmussen. Holding that the relationship between Watland and Rasmussen was not a joint adventure, the Court stated:

'* * * The property sold was jointly owned by appellants under the lease, and the sale, though advertised in the name of 'Watland and Rasmussen,' was merely a sale of their joint property for the purpose of converting it into money in closing up the tenancy. It was in no sense a venture.'

We find these definitions in Black's Law Dictionary, Fourth Edition: Venture: 'An undertaking attended with risk, especially one aiming at making money; business speculation.' Adventure: 'A hazardous and striking enterprise, a bold undertaking in a which hazards are to be met and issue hangs upon unforeseen events.' Joint Adventure: '* * * A special combination of two or more persons, where, in some specific adventure, a profit is jointly sought, without any actual partnership or corporate designation.'

A one-half undivided interest in the property constituting the subject matter of the alleged joint adventure was administered by defendant Wachovia Bank and Trust Company as trustee of the estate of Dio Clayton Lewis, an incompetent, by virtue of appointment by the Clerk of Superior Court of Surry County. The title to the property was in the ward of defendant bank, Cross v. Craven, 120 N.C. 331, 26 S.E. 940, and the trustee bank could take no action toward the sale of its ward's property without order and approval of the court. G.S. § 33--31; In re Edwards, 243 N.C. 70, 89 S.E.2d 746. Further, the contract upon which plaintiff relies to establish a joint adventure specifically provides for court approval.

The relationship of joint adventure did not exist among defendants, since each could not direct the conduct of the others. Neither was there an undertaking attended with risk by which defendants jointly sought a profit. The joint acts of defendants were merely an attempted sale by owners of undivided interests in real property for the purpose of converting a depreciating asset into money. The element of adventure was not present.

Thus evidence admissible against only one defendant was correctly held inadmissible against other defendants; neither was an agency relationship created among defendants so as to constitute each a principal and the agent of the others.

Absent the relationship of joint adventure, it is clear that the entry of judgment of nonsuit as to defendants R. J. Lovill, Jr., Henry B. Rowe, Jr., Gladys W. Lovill, J. Walter Lovill, Jr., Edward F. Lovill and Margaret Lovill Martin, was correctly entered.

We must therefore consider whether the trial court erred in allowing motion for nonsuit as to defendant Wachovia Bank and Trust Company, Trustee for Dio Clayton Lewis.

Plaintiff relied on breach of alleged contract embodied in a letter dated May 5, 1965, from W. P. Sandridge, Jr., attorney for defendant Wachovia Bank and Trust Company. Plaintiff contends that this letter affording him an opportunity to bid at a resale of the property became a bilateral contract when he signed and returned same to Mr. Sandridge.

The heart of a contract is the intention of the parties, which is ascertained by the subject matter of the contract, the language used, the purpose sought, and the situation of the parties at the time. 2 N.C. Index 2d, Contracts § 12, p. 315; Sell v. Hotchkiss, 264 N.C. 185, 141 S.E.2d 259; State Planters Bank v. Courtesy Motors, 250 N.C. 466, 109 S.E.2d 189. There must be a meeting of the minds so that the parties assent to the same thing in the same sense. Sprinkle v. Ponder, 233 N.C. 312, 64 S.E.2d 171. The facts of the instant case create substantial doubt that there was such meeting of the minds between defendant Bank and plaintiff. However, appellee, Wachovia Bank and Trust Company, contends that, in any event, it could not be responsible in damages for breach of contract to allow plaintiff to bid on property of its ward at a resale, when its trustee capacity was disclosed, so as to give notice that the sale could not be made without court proceeding.

The power of a guardian (sometimes, as here, designated trustee by authority of G.S. § 33--1 when referring to the keeper of an adult) to make disposition of his ward's estate is very carefully regulated, and the sale is not allowed except by order of court, which order must have the supervision, approval and confirmation of the resident judge of the district or the judge regularly holding the courts of the district. Morton v. Pine Lumber Co., 178 N.C. 163, 100 S.E. 322; G.S. § 1--339.28 and G.S. § 33--31.

Plaintiff could not have been afforded the opportunity to bid without an upset bid and an order of resale by the court.

'An upset bid is an advanced, increased or raised bid whereby a person offers to purchase real property theretofore sold, for an amount exceeding the reported sale price by ten percent (10%) of the first $1000 thereof plus five percent (5%) of any excess above $1000, but in any event with a minimum increase of $25, such increase being deposited in cash, or by certified check or cashier's check satisfactory to the said clerk of the superior court, with whom the report of the sale was filed, within ten days after the filing of such report: * * *' G.S. § 1--339.25(a), and 'When an upset bid is submitted to the clerk of the superior court,...

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