Jno. S. Reese & Co. v. Cole ( 1885 )

The only question before us is as to the legal efficacy of the sealed instrument, executed by the defendant in conferring a right to the property or to the possession of it.

The a section of the statute which gives the lien for advances to be used in making the crop, contains the following proviso: Provided, an agreement in writing shall be entered into before any such advance is made, in which shall be specified the amount to be advanced, or in which a limit shall be fixed, beyond which the advances, if made from time to time during the year, shall not go; Which agreement shall be recorded in the office of the register of the county in which the person to whom the advances are made resides, within thirty days after its date. Code, sec. 1799.

Now the prescribed conditions upon which the lien becomes effectual are the previous reduction of the contract for it to writing, setting out its terms, and registration within thirty days there after; these provisions being manifestly for the security of creditors and others who may have dealing with the debtor and otherwise might not know of the encumbrance upon the crop. And so it has been held that registration is not essential to the validity of the instrument as between (90) the parties to it. Gay v. Nash, 78 N.C. 100.

If registration is not necessary in a controversy between them, which is enjoined in as imperative terms as the committal of the lien contract to writing before advances are made, it would be reasonable to consider such requirements as intended for the protection of acquired rights of others to the property and not as indispensable to the agreement where the parties alone are concerned.

While the statute requires the writing to precede in the order of time the advances made as separate transactions, so that it should not be operative as a security for an existing debt, its construction does not require this when the delivery of the articles or money is to be used in the making the crop, and the agreement is a single transaction between the parties, executed by one in making the advances and by the other in providing the statutory security for their payment. In such case it is indifferent which act is first done, if both are done at the same time and in execution of their contract and understanding. The purpose is to enable the former to obtain the means of making his crop by creating a lien upon it when made, and the proviso is for the protection of others who may deal with him.

It does not allow this to be done to secure a preexisting debt, but only to provide for the making of the crop through supplies furnished for the purpose. This interpretation fulfills all the useful ends intended in the enactment and is in consonance with its terms.

A similar method of construction was pursued in ascertaining the meaning and giving effect to a section in the act of 11 September, 1861, which declares that "all deeds of trust and mortgages her after made and judgments confessed to secure debts shall be void as to creditors," unless providing for the payment pro rata of all the debts and liabilities of the maker.

It was held in McKay v. Gilliam, 65 N.C. 130, that notwithstanding the broad terms of the act its purpose was "to take from debtors (91) the right to give preference to some creditors to the exclusion of others," and its operations was confined to preexisting debts, and did not include a loan contracted at the time of the execution of the deed and secured by it.

The cases cited in the argument are not in conflict with this view.

In Clark v. Farrar, 74 N.C. 686, the instrument in from proposed to secure future advances, while in fact it was to secure a debt contracted the previous year. This was declared to be a fraudulent deed, not authorized by the statute, and Bynum, J., lays down, as the fundamental condition required by the statute, that "the advances must be in money or supplies to the person engaged or about to engage in the cultivation of the soil; after the agreement is made, to be expended in the cultivation of the crop made that year, and the lien must be on the crop of that year made by reason of the advances so made."

The same strictness in interpreting the act is reiterated in Patapsco v.Magee, 86 N.C. 350, and we do not relax the rule when we declare that when the furnishing the supplies and the making the securing instrument are contemporaneous, constituting one transaction of which these acts are parts, it is not material which precedes in actual time, for in contemplation of law both are done at one and the same time. This view is suggested in the opinion in Womble v. Leach, 83 N.C. 84, as a reasonable construction which accomplishes the substantial purposes intended.

We have some difficulty in understanding the statement of facts. In the defendant's covenant, which under takes to affix the lien on the crops, the consideration therefor is recited to be the plaintiff's agreement to deliver the fertilizer, and not the value of fertilizers already delivered, an act to be done in the future, and not an act already done, while the testimony on the witness is that they had been furnished when the defendant executed his covenant; but how long before, and whether in fulfilling the parts of a reciprocal contract made at the same time, does not appear.

(92) These discrepancies admit of reconciliation only upon the supposition that the undertakings were contemporaneous, and while the execution of that of the plaintiff was prior in time to execution of that of the defendant, both were in fulfillment of a common contract as an entirety. We assume this to have been the case upon the meagre statement in the record, and if otherwise, the defendant should have made it to appear, as it devolves upon an appellant to assign error, in the rulings of which he complains, and the facts upon which the error depends.

We affirm the ruling of the court, because it does not appear that the sale and delivery of the goods, as an advance, was, in the sense of the statute, not before but coincident with the giving of the statutory security therefor upon the crops.

There is no error, and the judgment must be affirmed.

No error. Affirmed.

Cited; Woodlief v. Harris, 95 N.C. 213; Butts v. Screws, ibid., 218;Knight v. Rountree, 99 N.C. 394; Farthing v. Carrington, 116 N.C. 324;Meekins v. Walker, 119 N.C. 49; Nicholas v. Speller, 120 N.C. 79;Bargain House v. Watson, 148 N.C. 297.