Poindexter v. FIRST NATIONAL BANK OF WINSTON SALEM , 247 N.C. 606 ( 1958 )

101 S.E.2d 682 (1958) 247 N.C. 606

Mrs. Mary Crews POINDEXTER and Mary Elizabeth Poindexter
v.
The FIRST NATIONAL BANK OF WINSTON SALEM.

No. 381.

Supreme Court of North Carolina.

January 31, 1958.

Eugene H. Phillips, Winston-Salem, for plaintiffs appellees.

McLennan & Surratt, Ratcliff, Vaughn, Hudson, Ferrell & Carter, Winston-Salem, for defendant appellant.

WINBORNE, Chief Justice.

The record and case on appeal here presented contains five hundred fourteen printed pages, in which there are seventy-nine assignments of error predicated upon one hundred twelve exceptions. And in brief filed in this Court defendant appellant states nine questions as involved on this appeal. However it appearing, upon consideration of the exceptions taken, assigned as error, that in the trial below there is prejudicial error for which a new trial must be granted, it is deemed expedient to advert only to some of them.

I. Assignment of error No. 71, based upon exception No. 104, is well taken. It is that the court erred in its charge on the first issue to differentiate between the numerous causes of action alleged by the plaintiffs, to state clearly the causes of action and the damages flowing therefrom, and to apply the law in each case to the evidence and other contentions of the parties in relation thereto as follows:

"The defendant excepts to the failure of the court in its charge on the first issue to differentiate between and to state clearly the various causes of action of the plaintiffs and the alleged damages flowing therefrom. The complaint alleges primarily three elements of damage: (a) the loss of the value of 451 shares of the stock of Winston Manufacturing Company, (b) the failure to collect the note of Winston Manufacturing Company in the original principal amount of $13,750.00 secured by 983 shares of the capital stock of Winston Manufacturing Company of Hickory (Terry Crouch Furniture Shops), and (c) failure to collect the alleged item of salary for the services of Nat S. Poindexter rendered prior to his death to Winston Manufacturing Company. The complaint further alleges that these losses arose from a variety of causes: (i) the lack of authority of the defendant to operate a business or businesses, (ii) the negligent operation of a business or businesses, (iii) the failure of the defendant to sell the stock of Winston Manufacturing Company or to attempt to sell it, (iv) the failure of the defendant in its banking department to offset the note for $13,750 against deposits of Winston Manufacturing Company, (v) the failure of the defendant to apply monies received by Winston Manufacturing Company from the sale of the assets of Winston Manufacturing Company of Hickory to the discharge of the note for $13,750, (vi) the negligent failure of the defendant to collect the salary item, (vii) the failure of the defendant to close and liquidate the businesses. Thus, six or more separate causes of action were submitted by the court to the jury under the first issue. It was the duty of the court to differentiate between the separate causes of action and items of damages clearly, and to charge the jury as to each of them so that it could clearly apply the law to the facts and the contentions of the parties, which the court failed to do. The defendant therefore excepts to the failure of the court to submit the issues clearly to the jury, to charge the jury upon the law relating thereto, and to apply the law to the facts as required by law."

II. Defendant appellant excepts to that portion of the charge to the jury in which the court instructed "that if the jury find from the evidence the facts to be as all the evidence tends to show, that you will answer the second issue submitted to you in this case ``No'." Exception No. 100, assignment of error No. 68. In the light of the amendments to answer of defendant, and evidence in relation thereto, the exception is well taken.

Furthermore, defendant, in apt time, requested the court to instruct the jury on the second issue as follows:

"The defendant contends and has offered evidence tending to show that it commenced, on July 8, 1953, a special proceeding to sell lands owned by Poindexter at the date of his death to make assets to pay debts, that the petition prayed for a public sale, that the petition set forth the debts remaining unpaid, including the note of Winston Manufacturing Company for $13,750; that the plaintiffs employed an attorney who represented them in the proceedings; that the plaintiffs, through their attorney, requested the defendant to amend its petition to pray for a sale at private sale; that an arrangement was worked out to get the bank to lend to the plaintiffs about $25,000 which was enough to pay all the debts of the estate including the $13,750 note, the costs of administration, and other items, and that the defendant then amended its petition to pray for a private sale to the plaintiff Mary Elizabeth Poindexter, the plaintiffs filed an answer admitting the allegations of the petition as amended, and joined in the prayer of the petition for the sale of the land; that an order of sale was entered finding the facts alleged in the petition and admitted in the answer; that sale was ordered, and, after the offer remained open for ten days, the sale to the plaintiff Mary Elizabeth Poindexter was confirmed; that the plaintiffs then knew the terms of the $13,750 note, the collateral security deposited with it, and the endorsements on it; that the sale was closed, a deed delivered to Mary Elizabeth Poindexter, and the purchase price was paid from the proceeds of the loan made by the defendant to her; that the note given for the loan had a maturity of one year which had been allowed to enable the plaintiffs to dispose of enough of the land to pay the debt; that it was agreed that a quitclaim deed or deeds would be given for lands sold within the one-year period if the proceeds were paid on the note, and that some of the land was sold, and quitclaimed, and the proceeds of sale were credited on the note within the one-year period."

Also "You may consider the contentions of the defendant and the evidence offered in support thereof relating to the special proceeding to sell land to make assets to pay debts in connection with the note of $13,750. If you find from the evidence and by its greater weight that the contentions of the defendant, which I have stated (paragraph 1) are true, the court charges you that the plaintiffs are estopped to allege any negligence or wrongful conduct of the defendant in connection with the $13,750 note, and you will answer that issue Yes as to the note for $13,750."

These requests were refused, and defendant excepts, exceptions numbers 73 and 75, assignments of error numbers 41 and 43.

Considering the evidence in respect to the proceeding to sell land to make assets as described in defendant's plea of estoppel, the Court is of opinion and holds that defendant is entitled to the requested instruction, and the exceptions to the refusal thereof are well taken and valid.

In this connection the evidence offered, as shown in the record, appears to support the statement of contention, on which the request is based. It is clear that in the verified petition to sell lands to make assets it is alleged by the petitioner as a fact that the $13,750 note is a debt of the estate of N. S. Poindexter, and the respondents, his widow and daughter, in their answer, verified by both of them, admit that the note is such a debt.

Having made such solemn admission they are estopped in the present action to contend otherwise. Armfield v. Moore, 44 N.C. 157; Crawford v. Crawford, 214 N.C. 614, 200 S.E. 421; Craver v. Spaugh, 227 N.C. 129, 41 S.E.2d 82; Smith v. McDowell Furniture Co., 232 N.C. 412, 61 S.E.2d 96; Stansel v. McIntyre, 237 N.C. 148, 74 S.E.2d 345; Bowen v. Darden, 241 N.C. 11, 84 S.E.2d 289; Pemberton v. Lewis, 243 N.C. 188, 90 S.E.2d 245, and cases cited.

In Armfield v. Moore, supra, Pearson, J., writing for the Court and referring to definition of estoppel, had this to say: "The meaning of which is, that when a fact has been agreed on or decided in a court of record, neither of the parties shall be allowed to call it in question, and have it tried over again at any time thereafter, so long as the judgment or decree stands unreversed * * * In other words, his mouth is shut, and he shall not say, that is not true which he had before in a solemn manner asserted to be the truth." This is cited with approval in numerous cases, some of which are cited in the Crawford case.

Moreover, the essential fact to be found to enable an administrator to maintain a proceeding to sell land to make assets, G.S. § 28-81 et seq., is the insufficiency of personal property to pay the debts of the decedent. Therefore there must be definite statements in the petition as to the amount of debts outstanding against the estate, and as to the personal estate, and the application therefor, to enable the court to see that there is such insufficiency of personal property. And the respondents, heirs at law, who are required to be made parties to the proceeding, have the right to plead any defense against a debt for which sale of the lands are to be made. Smith v. Brown, 101 N.C. 347, 7 S.E.2d 890; Matthews v. Peterson, 150 N.C. 134, 63 S.E. 721; Alexander v. Galloway, 239 N.C. 554, 80 S.E.2d 369.

And much more, a fortiori, if the respondents have the right to challenge the validity of such a debt, they have the right to admit the validity of it. Such admission becomes material to the proceeding. And when solemnly made in pleading it should be effective.

Indeed, as stated by this Court in Craver v. Spaugh, supra, opinion by Barnhill, J., later C. J., [227 N.C. 129, 41 S.E.2d 84.] "``It is a fundamental principle of jurisprudence that material facts or questions which were in issue in a former action, and were there admitted or judicially determined, are conclusively settled by a judgment therein, and that such facts or questions become res judicata and may not again be litigated in a subsequent action between the same parties * * *, regardless of the form the issue may take in the subsequent action. * * *' 30 A.J. 920." And, continuing, it is said: "This rule prevails as to matters essentially connected with the subject matter of the litigation and necessarily implied in the final judgment, although no specific finding may have been made in reference thereto. If the record of the former trial shows that the judgment could not have been rendered without deciding the particular matter, it shall be considered as having settled that matter as to all future actions between the parties. 30 A.J. 929."

The Court is not unmindful of the decisions in the cases of Latta v. Russ, 1860, 53 N.C. 111; Austin v. Austin, 1903, 132 N.C. 262, 43 S.E. 827, 95 Am. St. Rep. 637; Annotation 128 A.L.R. 472, at page 527, Atlantic Trust & Banking Co. v. Stone, 1918, 176 N.C. 270, 97 S.E. 8; In re Gorham, 1919, 177 N.C. 271, 98 S.E. 717. But it is considered that they are distinguishable in factual situations from that in hand.

III. The fifth question, stated by appellant as involved on this appeal, is this: "Did the court err in failing to comply with G.S. § 1-180 on the third issue relating to damages, and particularly by failing to state any measure of damages, by failing to state the evidence as to each element of damage and by failing to apply the law to the evidence?" This question is founded upon assignments of error 69, 73 and 74, which are based upon Exceptions 101, 106 and 107, respectively.

A reading of the charge indicates that this challenge to its correctness is properly directed.

Since there must be a new trial, it is deemed inexpedient to launch upon any extended discourse on the subject to which this question relates.

And, too, matters to which other questions raised and assignments of error entered relate may not then recur. Hence the opinion will not be unduly lengthened to no useful purpose. Nevertheless, let it be noted that further rights of the parties in respect to defendant's pleas of estoppel are reserved for consideration and determination by the court in the light of evidence to be adduced upon the new trial.

For errors pointed out there must be a New trial.