White v. K. B. Johnson & Sons Inc

• Decision Date: 24 January 1934
• Docket Number: No. 382.,382.
• Citation: 172 S.E. 370,205 N.C. 773
• Court: North Carolina Supreme Court
• Parties: WHITE. v. K. B. JOHNSON & SONS, Inc.

172 S.E. 370

205 N.C. 773

WHITE.

v.K. B. JOHNSON & SONS, Inc.

No. 382.

Supreme Court of North Carolina.

Jan. 24, 1934.

Appeal from Superior Court, Wake County; Cranmer, Judge.

Action by L. T. White against K. B. Johnson & Sons, Inc. From an adverse judgment, defendant appeals.

No error.

The complaint of the plaintiff, in part, is as follows: "That of date November 3, 1931, the plaintiff, L. T. White, loaned to the defendant, K. B. Johnson & Sons, Inc., the sum of $2,000, in cash and as evidence of said indebtedness received from the defendant, K. B. Johnson & Sons, Inc., its promissory note of date November 3, 1931, due in sixty days, and made for the principal sum of $2,000.00. That said note matured and became due on January 2, 1932, and the plaintiff called on the defendants for payment. That payment was promised from time to time but up until this date no payment has been made, and the defendant, K. B. Johnson & Sons, Inc., are justly indebted to the plaintiff, L. T. White, in the full sum of $2,000.00, together with interest from January 2, 1932, until paid."

The defendant pleaded ultra vires and no authority.

The plaintiff's testimony was as follows: "That on November 3rd, 1931, he lent $2,-900.00 to K. B. Johnson and Sons, Inc., and received as evidence of the debt a note for $2,000, which was the note sued upon, said note being due sixty days after date.

"Mr. White stated that nothing had been paid upon the note, except one payment of interest to January 2, 1932.

"The plaintiff offered the note in evidence and rested."

The defendant offered certain evidence which was excluded by the court below, which will be considered in the opinion. The court below charged the jury as follows:

"The plaintiff is Mr. L. T. White and the defendant is K. B. Johnson & Sons, Inc. The plaintiff sues on a certain promissory note, which has been introduced in evidence in the sum of two thousand dollars, dated November 3, 1931, and due sixty days after date. The only issue is:

"What sum, if any, is the defendant indebted to the plaintiff?"

"If you find, gentlemen, by the greater weight of the evidence, the facts to be as the evidence tends to show, I instruct you to answer the issue, '$2,000.00 and interest from January 2nd, 1932.' "

The issue and answer of the jury thereto was as follows: "In what amount, if any, is defendant indebted to plaintiff? Answer: $2,-000 and interest from Jan. 2, 1932."

The defendant made certain exceptions and assignments of error which will be considered in the opinion.

A. J. Fletcher and John W. Hinsdale, both of Raleigh, for appellant.

Bunn & Arendell, of Raleigh, for appellee.

CLARKSON, Justice.

The note in controversy was signed, "K. B. Johnson & Sons, Inc., by K. B. Johnson, President." The note was for $2,000, payable at 60 days. Nothing has been paid on the note except one payment of interest to January 2, 1932. The plaintiff testified that "he lent $2,000.00 to K. B. Johnson & Sons, Inc. and received as evidence of the debt a note for $2,000.00."

C. S. § 3004: "Every negotiable instrument is deemed prima facie to have been issued for a valuable consideration, and every person whose signature appears thereon to have become a party thereto for value."

C. S. § 3008: "Absence or failure of consideration is matter of defense as against any person not a holder in due course, and partial failure of consideration is a defense pro tanto, whether the failure is an ascertained and liquidated amount or otherwise."

O. S.. § 3041: "The maker of a negotiable instrument by making it engages that he will pay it according to its tenor, and admits theexistence of the payee and his then capacity to indorse."

The defendant did not set up the plea of payment, fraud, or mutual mistake. The defendant attempted to show: (1) That the money received from plaintiff was to pay a note of the Hanover Land & Timber Company, indorsed by K. B. Johnson and others; (2) that K. B. Johnson, the president of defendant's company, had no authority to execute the note sued on. This evidence was excluded by the court below, and defendant excepted and assigned errors. We thi...