Richardson v. Satterwhite

• Decision Date: 29 June 1932
• Docket Number: 257.
• Citation: Richardson v. Satterwhite, 203 N.C. 113, 164 S.E. 825 (N.C. 1932)
• Parties: RICHARDSON v. SATTERWHITE.
• Court: North Carolina Supreme Court

164 S.E. 825

203 N.C. 113

RICHARDSON v. SATTERWHITE.

No. 257.

Supreme Court of North Carolina

June 29, 1932

Appeal from Superior Court, Franklin County; Clayton Moore, Special Judge.

Action by Clement Richardson against Cullen Satterwhite, wherein N B. Finch and the Citizens' Bank of Spring Hope were made parties to the suit. Judgment for defendant, and plaintiff appeals.

New trial.

That one member of family conveys land to or borrows money from another is not evidence of fraud.

On March 5, 1924, the defendant, Cullen Satterwhite, and his wife executed and delivered a mortgage to N. B. Finch trading as N. B. Finch & Co., upon a tract of land in Franklin county, to secure a note in the sum of $4,011.73. Satterwhite is a colored man more than 70 years of age, and alleged that he was illiterate. On February 20, 1928, the said land was sold and purchased by F. D. Finch for the sum of $2,500. On April 27, 1928, F. D. Finch and wife conveyed the land to the plaintiff, Clement Richardson. On the same date, to wit, April 27, 1928, Clement Richardson and wife borrowed from the Citizens' Bank of Spring Hope the sum of $3,500, and executed a promissory note to said bank and secured the same by deed of trust upon the property to O. B Moss, trustee, which deed of trust was duly recorded on May 16, 1928.

The defendant, Satterwhite, remained in possession of the land and on November 24, 1928, the plaintiff instituted the present action against the defendant Satterwhite to recover possession of the land. Satterwhite filed an answer alleging in substance that he had been dealing with N. B. Finch, a general merchant, for many years; that he was illiterate and did not understand the nature of business transactions; and that when he executed and delivered the mortgage on March 5, 1924, to secure the note for $4,011.73 he was not indebted to N. B. Finch & Co. in any amount whatever. He further alleged that N. B. Finch, the mortgagee, was president of the Citizens' Bank of Spring Hope at the time of the sale of said land, and at the time the plaintiff, Richardson, purchased from F. D. Finch and executed the said $3,500 note. He further alleged that F. D. Finch, the purchaser of the land at the mortgage sale, was the son of N. B. Finch; that the plaintiff was a nephew of said Finch, and that, by reason of the further fact that the said N. B. Finch was a member of the loan committee of said bank which loaned to the plaintiff the sum of $3,500, the bank was charged with notice of the failure of consideration of the mortgage given by the defendant on March 5, 1924, and hence that the bank was not an innocent holder of said $3,500 note.

The evidence for the plaintiff tended to show that the defendant, Satterwhite, had been dealing with N. B. Finch, trading as N. B. Finch & Co., for many years, and that he had executed to said Finch from time to time various liens and deeds of trust upon said land to secure the payment of advances made to him, and that the defendant made no complaint about the correctness of the account until the land was first advertised for sale in November, 1926.

The defendant, Satterwhite, offered evidence tending to show that the defendant, N. B. Finch, offered to loan him $4,000 to buy an additional tract of land, and that he executed a mortgage for that amount, but that the seller of the land declined to make a deed, and he then made demand upon N. B. Finch to return the papers to him. This was never done.

The following issues were submitted to the jury:

"1. Was the defendant indebted to N. B. Finch & Company on account of the indebtedness recited in the mortgage deed referred to in the pleadings and at the time of the attempted foreclosure of the said mortgage deed, and, if so, in what amount?

"2. Was the plaintiff purchaser for value of the lands in question and without notice of the equities of the defendant, as alleged in the answer?

"3. Did the Citizens' Bank of Spring Hope, N. C., take its deed of trust upon said lands for value and without notice of the equities of the defendant, as alleged in the answer?"

The jury answered the first issue "Nothing"; the second issue "No"; and the third issue "No."

Upon the verdict, judgment was entered decreeing that the plaintiff is not the owner nor entitled to the possession of the land described in the complaint. It was further ordered that the mortgage deed from Cullen Satterwhite and wife to N. B. Finch & Co., dated March 25, 1924, be adjudged to be "void and of no effect," and the clerk of the superior court of Franklin county is directed to cancel the same upon the records of said county, etc.

Hobart Brantley, of Spring Hope, and White & Malone, of Louisburg, for appellants.

W. L. Lumpkin and Yarborough & Yarborough, all of Louisburg, for appellee.

BROGDEN J.

On August 20, 1925, the defendant, Satterwhite, went to the place of business of N. B. Finch & Co., mortgagee, for the purpose of examining the status of the account. The defendant narrated the transaction as follows: "Mr. Ruffin was my lawyer before he died. He went down there and went over these accounts. He came by my house and got me. He came somewhere close about ten o'clock. I don't know what time, but *** I got back home that night. He came up here and checked up everything. When Mr. Ruffin checked up everything I got up here about eleven o'clock and Mr. Ruffin had me gone away from here about two hours by sun. He and I went down there that day, and when we were coming back he said: 'Satterwhite, they have got you in debt. ***' He said something was mighty wrong, and Mr. Finch told me himself that something was mighty wrong about my account. *** When I got down there I went over the books with Mr. Roebuck. I can read figures, but I can't read writing. *** We were going over all the accounts. *** I didn't get a dollar of money."

On the next day, to wit, August 21, 1925, William H. Ruffin, now deceased, and an eminent lawyer, wrote a letter to N. B Finch & Co. The letter begins as follows: "Louisburg, North Carolina, August 21, 1925. Messrs. N. B. Finch & Co., Spring Hope, N.C. Gentlemen: In re: C. C. Satterwhite note adjustment. Mr. Lassiter and I, with Cullen's assistance, finished up our investigation of your books late yesterday evening, and checking over my work this morning I find that the only items now in question between us are checks made to your order as follows: 1913-Feb. 17, $5.00, Feb. 22, $5.00, Mar. 22, paid through Henry Satterwhite, $5.00, Sept. 6, $2.25, Sept. 9, $5.00; 1915-May 29, $10.00, June 12, $10.00; 1916-May 29, $5.60; 1917-Jan. 13, $6.39; 1919-Apr. 21, $10.00, Apr. 28, $5.00, Apr. 19, $4.00, May 16, $10.00, July 8, $8.80, Sept. 26, $31.68, Dec. 2, $6.60. These checks total $130.32. He contends, as you know, that these were payments on account and not merely checks cashed for his accommodation. Possibly your cash account for these dates might throw some light on this question. *** I could not always check up on your renewal notes, but from the best information I could get the last note, dated March 5, 1924, for $4,011.73, is correct, and we raise no further question about the same. *** I am advising Cullen to make every effort to pay this down out of the 1925 crops to $3,000.00 or less, and if he will do this I believe I can reinstate his land bank loan and...