North Carolina Bank & Trust Co. v. Williams, 208 N.C. 243 (1935)

May 22, 1935 · Supreme Court of North Carolina

208 N.C. 243

NORTH CAROLINA BANK AND TRUST COMPANY v. J. F. WILLIAMS et al.

(Filed 22 May, 1935.)

1. Limitation of Actions A d—

The ten-year statute of limitations, O. S., 437, applies to actions upon sealed instruments against the principals thereon, but not against the sureties.

2. Limitation of Actions C b — Assignee held not entitled to peremptory instruction, based upon resolution executed by principal and sureties to third person, that action on the instrument was not barred.

Where it appears that an action upon a sealed instrument was instituted more than three years after the accrual of the cause of the action, and plaintiff, the assignee of the instrument, relies on a resolution of the corporate principal and the individual sureties, executed to a third person less than three years prior to the institution of the action, which resolution stated that the parties to the instrument agreed to remain bound thereon, a peremptory instruction in favor of plaintiff assignee on the issue of the bar of the statute is error, certainly as to one or more of the sureties, it appearing that one surety did not sign the resolution, and that another did not sign it individually.

Appeal by defendants from Barnhill, J., at December Term, 1934, of DupliN.

Civil action to recover on indemnity bond given by tbe Bank of Rose Hill, as principal, and its directors, as sureties, to tbe Bank of Duplin, and assigned to tbe North Carolina Bank and Trust Company as collateral security.

Several defenses were interposed, including a plea of tbe tbree-year statute of limitations, wbicb latter plea, being a plea in bar, was tried before a jury, and resulted in a directed verdict for plaintiff; whereupon tbe cause was referred to a referee under tbe Code.

From tbe trial before tbe jury on tbe plea in bar, tbe defendants appeal, assigning errors.

Bryan & Campbell and George B. Ward for plaintiffs.

B. B. Johnson, Beasley & Stevens, Oscar B. Turner, and Ward & Ward for defendants.

Stacy, C. J".

This is tbe same case that was before us on demurrer at tbe Fall Term, 1931, reported in 201 N. C., 464, 160 S. E., 484, opinion filed 14 October, 1931.

Tbe present record is not in very satisfactory shape, but, as we understand it, tbe jury finds that tbe losses, if any, incurred by tbe Bank of Duplin in tbe liquidation of tbe assets of tbe Bank of Rose Hill were sustained prior to 20 April, 1928. This action was instituted 21 April, 1931.

Tbe bond in suit was executed 15 July, 1926. It seems to have been assumed that it was under seal, both as to tbe principal and tbe sureties, but there is neither admission nor finding to this effect as to tbe sureties. Welfare v. Thompson, 83 N. C., 276; Williams v. Turner, ante, 202.

Tbe ten-year statute, C. S., 437, applies to actions upon sealed instruments against tbe principals thereto, and not against tbe sureties. Welfare v. Thompson, supra; Redmon v. Pippen, 113 N. C., 92, 18 S. E., 50.

On 27 September, 1928, tbe Bank of Rose Hill and its board of directors, by resolution, requested tbe North Carolina Corporation Commission to proceed to take possession of its assets and liquidate tbe same under tbe banking laws of tbe State, and, in tbe same resolution the principal and sureties to tbe indemnity bond executed to tbe Bank of Duplin on 15 July, 1926, agreed “to remain bound and liable on tbe •said indemnity bond until tbe Bank of Duplin shall have been reimbursed for tbe money advanced by it,” etc. Tbe defendant Maury Ward did not sign this resolution. Nor does J. C. Williams appear to have signed it individually.

Tbe assignment to tbe plaintiff of tbe original bond was upheld as against a demurrer (201 N. C., 464), but wbetber tbe assignee can claim any benefit from tbis resolution was not presented or considered.

There was error in tbe peremptory instruction, certainly as to one or more of tbe defendants.

New trial.