Sterling Mills, Inc. v. Saginaw Milling Co.

• Decision Date: 06 December 1922
• Docket Number: 475.
• Citation: 114 S.E. 756,184 N.C. 461
• Parties: STERLING MILLS, INC., v. SAGINAW MILLING CO.
• Court: North Carolina Supreme Court

114 S.E. 756

184 N.C. 461

STERLING MILLS, INC., v. SAGINAW MILLING CO.

No. 475.

Supreme Court of North Carolina

December 6, 1922

Appeal from Superior Court, Iredell County; Ray, Judge.

Action by Sterling Mills, Incorporated, against Saginaw Milling Company, in which the Second National Bank of Saginaw Michigan, intervened. From a judgment in favor of plaintiff intervener appeals. Reversed and remanded.

In an action against the consignor of goods under a bill of lading with draft attached, the testimony of the cashier of an intervening bank claiming ownership of the draft held sufficiently equivocal, if not contradictory, to render it error for the court to charge the jury that, if they believed the testimony, they should answer the issue of ownership in the negative.

Whether a bank claiming ownership of the proceeds of a draft attached to a bill of lading was a purchaser for value of the draft or a mere collecting agent for the consignor, depended on the intention of the parties, and was a question of fact for the jury, where the evidence was conflicting.

Plaintiff a North Carolina corporation, with its principal place of business at Statesville, N. C., having a cause of action against the Saginaw Milling Company, a foreign corporation, instituted this suit in the superior court of Iredell county, and sought to obtain service upon the defendant by attaching the proceeds of a draft in the hands of the People's Loan & Savings Bank, Statesville, N. C., alleging that said funds belonged to the defendant.

Thereafter on the 19th day of August, 1921, the Second National Bank of Saginaw, Mich., was allowed to intervene and to set up its claim of title to the proceeds of said draft.

The first issue was as follows: "Is the interpleader, Second National Bank of Saginaw, Mich., the owner of the proceeds of the draft attached by the plaintiff in this action?" The jury answered: "No."

Upon the issue thus raised, there was a verdict and judgment in favor of the plaintiff. The defendant made no appearance and filed no answer. Intervener appealed.

John A. Scott, Jr., of Statesville, for appellant.

Dorman Thompson, of Statesville, for appellee.

STACY J.

The burden was on the intervener to make good its claim and to show title to the property attached. Moon v. Milling Co., 176 N.C. 410, 97 S.E. 213. In order to meet this requirement, the intervening bank offered evidence tending to show, prima facie at least, that it was a purchaser of the draft in question, for value, and a holder of the same in due course, without notice of any defenses or equities. C. S. 3040; 1 Dan. on Neg. Inst. §§ 812, 814a; Jackson v. Love, 82 N.C. 405, 33 Am. Rep. 685; Hodge v. Smith, 130 Wis. 326, 110 N.W. 192; Scoville v. Landon, 50 N.Y. 686.

After offering the draft in evidence, due execution of which was admitted by the plaintiff, E. W. Glynn, cashier of the intervening bank, testified as follows:

"The draft was in possession of the Second National Bank with bill of lading attached; it belonged to the Second National Bank of Saginaw; the proceeds of payment of said draft belonged to the Second National Bank of Saginaw, Mich. The Saginaw Milling Company did not own any interest in the draft when forwarded by the Second National Bank of Saginaw, and does not own any interest in the money paid for said draft by the Statesville Flour Mills and later attached by the Sterling Mills. The Second National Bank of Saginaw does not owe the Sterling Mills anything. The draft was in the possession of the Second National Bank of Saginaw as owner, and

...