Opinion
(December Term, 1860.)
Where dealings between a father-in-law and his son-in-law, wherein the latter had been the other's agent, were closed in a hurried manner, and a note given by the father-in-law at the importunate solicitation of the son-in-law, on calculations made by him, under a promise that the whole settlement should be open to subsequent examination, and the answer to specific allegations of errors was unfair and evasive, it was Held, that an injunction to restrain a judgment at law on such note should be continued to the hearing, and that the judgment should stand as security for whatever might be ascertained to be due.
APPEAL from an interlocutory order of the Court of Equity of WILSON.
The plaintiff, Hadley, and the defendant, Rountree, entered into a written agreement 16 December, 1856, wherein it was stipulated that the said Hadley was to put the said Rountree into possession of his mills and farm on the 1st of the next ensuing January, which the latter was to hold until 1 January, 1859; that Hadley was to pay for all hires of hands, buildings and purchases for the use of the (108) premises; that Rountree was to give his personal attention to the business, and was to receive, at the end of each year, one thousand dollars as his wages, and that any advances of money which he might make were to be deducted out of the proceeds of the farm, mills, etc., and the business to be closed at the end of each year by note. At the close of 1857, Rountree presented his account, and Hadley gave him a note for $14,815.91, on which suit was brought at law and a judgment recovered. The bill is brought to enjoin the collection of this judgment, and to have an account taken between the parties, alleging fraud and imposition in the conduct of the defendant in obtaining the note from him, and many false charges and suppressions of credits in the account on which the note was founded. The plaintiff alleges that he is an old man, and that his business had become much confused, and having much confidence in the defendant, who is his son-in-law, he was induced, for the purpose of relieving himself, to enter into the contract above stated. He says towards the close of the year 1857, the defendant became urgent for him, plaintiff, to settle with him and give him a note for the amount due; that to get rid of these importunities, and relying on the word of the defendant, who promised that the whole account should be reexamined by some competent person, and any errors that might appear should be corrected, he was induced to sign the note aforesaid; that all the calculations were made by the defendant, and that the plaintiff did not at all canvass them, nor any of the items of the account; that all the vouchers, receipts, etc., on which this account was alleged to be based, were retained by the defendant, and that he had refused to surrender them to the plaintiff. Among other specifications of the falseness of this account, it is alleged that the defendant had failed to give him credit for seven bales of cotton, of the crop of 1856, which were on hand when the defendant took charge of the business, and that no notice is taken of this cotton in any part of the account.
To the allegation as to the cotton, the defendant answers as (109) follows: "This defendant has no recollection of the seven bales of cotton having been committed to his hands, and does not believe it to be true; but of this the defendant is certain, if it ever came to his hands, the complainant received the proceeds. There would appear no item of it in the account of 1857, since the transactions, under the contract, for each year were to be kept distinct."
To the charge that the defendant had withheld the vouchers, the defendant answers and admits that he kept them, but says, "Of this the plaintiff cannot complain, since they are of no service to him whatever — consisting of receipts for money paid to third persons, sheriff's receipts for money paid on executions against him, etc., etc. There is no evidence of debt whatever held by this defendant against the complainant among these vouchers, and they are, and always have been, open to the inspection of the complainant."
The conflict between the last recited passage of the answer and several items of charge in the account filed by the defendant as an exhibit, is pointed out in the opinion of the Court.
On the coming in of the answer, the Court below ordered the injunction, which had been issued in the case, to be dissolved, and the plaintiff appealed to this Court.
A. M. Lewis, for the plaintiff.
Dortch and Strong, for the defendant.
By force of the agreement executed 16 December, 1856, the defendant was bound, at the close of the year 1857, to render an account.
From the answer and the account filed as an exhibit, we are satisfied that, so far from rendering a full and fair account, as he was bound to do, the defendant induced the plaintiff to execute the note mentioned in the pleadings upon the footing of calculations by himself, upon loose statements and detached papers, without time for examination; so that, in fact, there was no account rendered, and nothing done by the parties, considering the relation in which they stood, (110) which can be allowed the effect of a settlement.
The answer is unfair and evasive in many respects; for instance, to the charge that when the defendant took possession of the farm and mills there were on hand, among other things, seven bales of cotton, which the defendant had failed to account for; the response is: "This defendant has no recollection of the seven bales of cotton having come into his hands, and does not believe it to be true; but of this the defendant is certain, if it (the seven bales of cotton) ever came to his hands, the complainant received the proceeds. There would appear no item of it in the account of 1857, since the transactions, under the contract, for each year were to be kept distinct."
The first attempt is made to evade this charge by treating the seven bales of cotton as of no more importance than a stack of fodder, about which the defendant could not be expected to have any distinct recollection! The second is by a suggestion that the seven bales of cotton, being of the crop of 1856, did not form an item in the account of 1857, as the transactions of each year, by the contract, were to be kept distinct. If this cotton did not make an item in the account for the year 1857, it certainly would not in the account for the year 1858! But supposing this cotton to have been on hand on 1 January, 1857, and in regard to a fact of that importance, an agent, who is bound to render an account, is not at liberty to leave the matter in doubt, then it did properly form an item of account for the first year, as much as the lumber and other articles on hand when the defendant took charge of the business, and the loose and general statements of the answer in regard to it shows the sort of "settlement" made on 1 January, 1858, when the plaintiff was induced to execute his note.
Again, the bill charges that the defendant kept possession of all the vouchers, receipts, etc., on the footing of which the calculations were made and the note executed. The answer admits this, and by way of explanation says: "The plaintiff can not complain, since (111) they are of no service to him whatever — consisting of receipts for money paid to third persons, sheriff's receipts for money paid on executions against him, etc., etc. There is no evidence of debt whatever held by the defendant against the complainant among the said vouchers," and yet, in the account filed with the answer as an exhibit, is this item: "Note due 1 January, 1857, with interest to 1 January, 1858, $1,718.33," which is thus charged to the plaintiff, but is held by the defendant. Again: although the note is executed 1 January, 1858, as for a balance, $14,815.91, then due, in the account, set out for the purpose of showing that balance, there are several charges in January and February, 1858, e. g., cash paid Moses Rountree 19 January, 1858, $958.14: cash paid Rountree Co., 4 February, 1858, $370.21.
It is unnecessary to make further specifications. "The judgment at law ought only to be allowed to stand as a security for whatever may be found to be due to the defendant upon taking an account between the parties, on the footing of the principal and agent"; Franklin v. Ridenhour, 58 N.C. 422.
There is error in the decretal order dissolving the injunction. It ought to be continued to the hearing.
PER CURIAM. Decretal order reversed.
Cited: Levin v. Gladstein, 142 N.C. 490.
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