Speas v. Merchants' Bank & Trust Co. of Winston-Salem

• Citation: 125 S.E. 398,188 N.C. 524
• Decision Date: 05 November 1924
• Docket Number: 356.
• Parties: SPEAS ET UX. v. MERCHANTS' BANK & TRUST CO. OF WINSTON-SALEM.
• Court: United States State Supreme Court of North Carolina

125 S.E. 398

188 N.C. 524

SPEAS ET UX. v. MERCHANTS' BANK & TRUST CO. OF WINSTON-SALEM.

No. 356.

Supreme Court of North Carolina

November 5, 1924

Appeal from Superior Court, Forsyth County; Lane, Judge.

Action by D. C. Speas and wife against the Merchants' Bank & Trust Company of Winston-Salem. Defendant had judgment in the county court, but on appeal to the superior court, error was found and case remanded. From the judgment and order defendant appeals. Reversed.

Civil action to recover of defendant the penalties allowed by statute for knowingly charging and receiving a greater rate of interest than 6 per cent. per annum on moneys alleged to have been loaned to the plaintiff by the defendant.

The case was originally tried in the Forsyth county court and resulted in a verdict and judgment for the defendant. On appeal to the superior court, error was found in the charge relating to the law of usury and the burden of proof, and the cause was thereupon remanded to the county court for another hearing. From this judgment and order of the superior court the defendant appeals, contending that the case was correctly tried in the county court, and that therefore the judgment as originally entered should be affirmed.

In action to recover penalties for charging and receiving usurious interest, burden of proof of issue is properly placed upon plaintiff.

J. E. Alexander and L. M. Butler, both of Winston-Salem, for appellant.

E. Garland Brown and S. J. Bennett, both of Whiteville, and Wm. Porter, of Winston-Salem, for appellees.

STACY J.

It was contended by the defendant that in making the loan, upon which plaintiff alleges he paid a greater rate of interest than 6 per cent. per annum, it (the defendant bank) was acting as special agent for the Bank of Stem or as agent for both lender and borrower, and that this fact was known to the plaintiff at the time the loan was negotiated and also at the time the alleged usurious interest was paid. The trial court instructed the jury that the plaintiff could not recover of the present defendant if the alleged usurious interest were charged and collected by it for the use of another, and not for its own benefit, and such was known to the plaintiff at the time the loan was negotiated and at the time the alleged usurious interest was paid. This instruction was held to be erroneous by the superior court, but we are unable to perceive any essential error in it. 39 Cyc. 1090. Clearly, the principal would be liable who profited by the transaction, and there is no provision for holding the agent liable and the principal also. This would be to create a double liability in such a case; whereas, the statute imposes only one. Brown v. Johnson, 43 Utah, 1, 134 P. 590, 46 L. R. A. (N. S.) 1157, Ann. Cas. 1916C, 321, and note; 27 R. C. L. 238 et seq.

We are cited by plaintiff's counsel to several authorities which seem to hold or to intimate a contrary view of the law, but these cases were rendered under statutes making it a misdemeanor to receive or to charge a greater rate of interest than that allowed by law, and this upon the principle that in misdemeanors all concerned and participating are principals in the crime. It is not necessary for us to take issue with these decisions, as they are doubtless correct. But our statute does not go so far; it provides that the exaction of usury, knowingly made, shall destroy the interest-bearing quality of a note or other evidence of debt affected with usury, and authorizes the debtor to recover a penalty of twice the amount of usurious interest paid, and no more. Waters v. Garris, 188 N.C. 305, 124 S.E. 334; Miller v. Dunn, 188 N.C. 397, 124 S.E. 746.

We think the exception to the charge as it relates to the burden of proof should not have been sustained, but should have been overruled on the principle that the court's charge is to be construed contextually, as a whole, and not disjointedly. Cherry v. Hodges, 187 N.C. 368, 121 S.E. 538.

"It is to be considered as a whole in the same connected way in which it was given, and upon the presumption that the jury did not overlook any portion of it. If, when so construed, it presents the law fairly and correctly to the jury, it will afford no ground for reversing the judgment, though some of the expressions, when standing alone, might be regarded as erroneous." State v. Exum, 138 N.C. 599, 50 S.E. 283.

The trial court placed the burden of the issue upon the plaintiff and charged the jury in language almost identical with that of Justice Walker in the case of Winslow v. Hardwood Co., 147 N.C. 275, 60 S.E. 1130, where, quoting from Elliott on Evidence, the rule is stated as follows:

"The burden of the issue--that is, the burden of proof in the sense of ultimately proving or establishing the issue or case of the party upon whom such burden rests, as distinguished from the burden or duty of going forward and producing evidence--never shifts, but the burden or duty of proceeding or going forward often does shift from one party to the other, and sometimes back again. Thus, when the actor has gone forward and made a prima facie case, the other party is compelled in turn to go forward or lose his case, and in this sense the burden shifts to him. So the burden of going forward may, as to some particular matter, shift again to the first party in response to the call of a prima facie case or presumption in favor of the second party. But the party who has not the burden of the issue is not bound to disprove the actor's case by a preponderance of the evidence, for the actor must fail if upon the whole evidence he does not have a preponderance, no matter whether it is because the weight of evidence is with the other party or because the scales are equally balanced."

In view of the number of recent cases which have come to this court presenting the questions, it may be useful to say a word in regard to the burden of proof, the degree of proof required in some cases, the duty and extent of going forward with evidence, and when this duty or requirement shifts from one party to the other. The distinctions which separate these several propositions, one from another, are now very generally recognized and accepted, though they are sometimes blurred by careless speech, and not infrequently by inaccurate expressions.

In criminal prosecutions, where the defendant or prisoner pleads "not guilty" to the charge contained in the warrant or bill of indictment to which he is required to answer, such plea draws about him the common-law presumption of innocence. He enters upon the trial with this presumption in his favor. His plea of traverse casts upon the state the burden of establishing his guilt, not merely by a preponderance of the evidence, but to a moral certainty or beyond a reasonable doubt. State v. Singleton, 183 N.C. 738, 110 S.E. 846.

In the absence of some admission or evidence establishing an opposite presumption, sufficient to overcome the presumption of innocence, the most that can be required of a defendant in a criminal prosecution, under our system of jurisprudence, is explanation, not exculpation. The defendant is not required to show his innocence. The state must prove his guilt beyond a reasonable doubt, and the burden of this ultimate issue never shifts. The laboring oar on the question of guilt is constantly with the prosecution. State v. Wilbourne, 87 N.C. 529; State v. Falkner, 182 N.C. 793, 108 S.E. 756, 17 A. L. R. 986.

True, it is sometimes said that the duty of producing evidence rests upon the party best able to sustain it, because of facts and circumstances peculiarly within his knowledge. Thus it was held in Farrall v. State, 32 Ala. 557, that the existence of a license being a fact peculiarly within the knowledge of the party accused, it was incumbent upon him to show the license, even though the nonexistence thereof was the gravamen of the offense charged. To like effect, and for the same reason, are our own decisions: State v. Morrison, 14 N.C. 299; State v. Smith, 117 N.C. 809, 23 S.E. 449; State v. Emery, 98 N.C. 670, 3 S.E. 636; State v. Glenn, 118 N.C. 1194, 23 S.E. 1004; State v. Holmes, 120 N.C. 576, 26 S.E. 692.

Speaking to this matter in Shepard v. Tel. Co., 143 N.C. 244, 55 S.E. 704, 118 Am. St. Rep. 796, it was said:

"In criminal cases, when a homicide with a deadly weapon is proved or admitted, there is a presumption of law that the killing is murder, and the burden is on the prisoner to prove all matter in mitigation or excuse to the satisfaction of the jury, State v. Matthews, 142 N.C. 621; and when a totally independent defense is set up, as insanity, which is really another issue, State v. Haywood, 94 N.C. 847, the burden of that issue is on the prisoner. But the burden of the issue as to the guilt of the prisoner, except where the law raises a presumption of law as distinguished from a presumption of fact, remains on the state throughout, and when evidence is offered to rebut the presumption of fact raised by the evidence, the burden is still on the state to satisfy the jury of the guilt of the prisoner upon the whole evidence. Notably, when the prisoner offers proof of an alibi, for example, which goes to the proof of the act. State v. Josey, 64 N.C. 56."

It is sufficient, in criminal prosecutions, to warrant an acquittal, where the defendant simply enters a denial to the charge, that the jury, upon the whole evidence, should entertain a reasonable doubt as to the defendant's guilt for in such cases the burden is always on the state to establish his guilt beyond a reasonable doubt. State v. Schoolfield, 184 N.C. 721, 114 S.E. 466. So where the state makes out a prima facie case and rests, the defendant is not required to offer evidence in reply; he may rely upon...