Pugh v. Grant

• Citation: 86 N.C. 39
• Court: United States State Supreme Court of North Carolina
• Decision Date: 28 February 1882
• Parties: THOMAS G. PUGH v. J. W. GRANT, Adm'r.

86 N.C. 39

THOMAS G. PUGH

v.J. W. GRANT, Adm'r.

Supreme Court of North Carolina.

February Term, 1882.

CIVIL ACTION tried at Spring Term, 1880, of NORTHAMPTON Superior Court, before Gudger, J.

This action was begun in a justice's court, and brought by the appeal of the plaintiff to the superior court. In both courts the pleadings were oral, and so intricate as to make it somewhat difficult to state them intelligently.

The plaintiff declared as indorsee of two bonds executed by the defendant's intestate to one John A. Vincent, and by him indorsed to the plaintiff. The bonds were both payable on demand--one being for $51.88, dated the 5th day of January, 1861, and indorsed the 15th day of April, 1875, and the other for $100, dated the 4th March, 1861, and indorsed the 15th day of April, 1876.

The defendant denied the title of the plaintiff to the bonds, and alleged that there was fraud in their indorsement, and by way of set-off and counterclaim, he pleaded certain bonds, in all amounting to $1,000, which the plaintiff's assignor was owing to his intestate, and a further sum of $463.73 which defendant as administrator had paid to use of said assignor, prior to the alleged indorsement on a note in which he and the defendant's intestate were jointly bound.

In reply, the plaintiff denied the fraud alleged, and pleaded accord and satisfaction of the claims against his assignor, attempted to be set up in defendant's plea of set-off and counterclaim.

In turn, the defendant denied that there had been any accord and satisfaction of said claims, and alleged fraud on the part of the plaintiff's assignor in procuring the instrument purporting to be such (which instrument is referred to in the case as exhibit “C.”) This allegation of fraud the plaintiff denied.

At the trial two issues were agreed to by counsel and submitted by the court:

1. Were the bonds in action assigned as alleged in good faith and for a valuable consideration?

2. Was the agreement marked “C” procured from defendant by the plaintiff's assignor (Vincent) with intent to defraud intestate's estate, by concealing from the defendant the fact that he had in his possession, or had recently transferred to the plaintiff, the bonds sued on?

In support of the first issue, the plaintiff, after putting in evidence the bonds sued on, and the indorsements thereon, read the deposition of his assignor, Vincent, going to show that the indorsements were truly made at the times they respectively bear date, to-wit, the 15th April, 1875, and the 15th April, 1876, and that the consideration of their transfer to plaintiff was a debt due from the witness to the plaintiff, and the sum of twenty dollars paid him in cash at the time of the transfer.

As tending to show fraud in the assignment of the bonds to plaintiff, the defendant proved that the plaintiff was a brother-in-law of his assignor, Vincent, who was at the time in failing circumstances, and that no one was present at their settlement, and no memorandum thereof made, or receipt taken. That the plaintiff himself had no visible property, being a clerk in a store at a salary of $65 per month, with a family to support, and that very soon after the transfer of these bonds, the said Vincent conveyed to the plaintiff all his real estate situate in North Carolina.

Upon this issue His Honor instructed the jury, “that the question was whether the assignment of the bonds was an honest transaction? If that was so, and they should find that money, or money's value, was paid as the consideration of such assignment, its amount, unless grossly inadequate, was immaterial; but that the burden of proof was upon the plaintiff to establish this issue.”

Under the second issue, the plaintiff offered in evidence the writing marked ““C,” which is as follows: “Feb'y 10th, 1877--Rec'd of J. B. Vincent the sum of $238.48, being the amount of three notes and interest, held by the said J. B. Vincent against the estate of James Vincent, to be applied to the credit of the said J. B. Vincent on bonds I hold against him, due the said James Vincent, and when the said J. B. Vincent surrenders to me an account he holds in favor of Pugh & Vincent, I agree then to give him a discharge from any claim that may be due from him to the said James Vincent”--which paper, it is admitted, is signed by the defendant, as administrator; and he showed by the deposition of J. B. Vincent the circumstances under which it had been executed. He also offered to prove, by reading the same deposition, the nature and extent of the witness' indebtedness to the defendant's intestate, and that the money which defendant claimed to have paid to his use, was not in fact so, for that while he and said intestate had been partners, and the note, upon which said payment was made, was given in their firm name, still it was for a debt of said intestate, and the witness was, by agreement between them, to be bound only as surety. This evidence was objected to by the defendant at the time the deposition was taken, and the objection renewed at the reading thereof, upon the ground that the witness was incompetent under section 343 of the Code, to speak of a transaction or communication with his deceased partner, and upon that ground the evidence was excluded.

The defendant then offered evidence in support of his plea of set-off and counterclaim.

Upon the second issue His Honor instructed the jury that “where a contract is made between two parties, and any fact material to the consideration moving said contract is exclusively in the knowledge of one of said parties, it is the duty of such party to make known such fact, and if he intentionally fails to do so, it is a fraud upon the other contracting party,” and further, that it was a question of fact for them to determine, whether there was such a concealment of any material fact in this case, and that the burden of proof under this second issue was upon the defendant.

To the first issue the jury responded in the negative; and to the second they said, that the agreement marked “C” was procured from the defendant by the plaintiff's assignor, with the intent to defraud the estate of his intestate.

After judgment for the defendant the plaintiff appealed, assigning as errors: 1. That His Honor erred in instructing the jury that the burden of proof to support the first issue was upon the plaintiff; whereas he should have told them that it was for the defendant to show, by a preponderance of testimony, that the plaintiff had used fraud in procuring the indorsement of the bonds to himself. 2. That he erred in excluding the testimony of the witness, Vincent, as to the nature of his alleged indebtedness to the estate of the defendant's intestate. 3. That he erred in not explaining to the jury, in his charge upon the second issue, what should be considered by them as material to the consideration of the contract--the only alleged fraud being the failure on the part of the assignor, Vincent, to inform the defendant of the fact that he had transferred the bonds sued on, when he entered into the agreement set forth in the exhibit “C.”

Mr. Thomas W. Mason, for plaintiff .

Mr. R. B. Peebles, for defendant .

RUFFIN, J., after stating the case.

If the first issue, and His Honor's charge with reference to it, stood alone in the cause, we should unquestionably sustain the defendant's first exception.

As...