#### BURLINGTON HOTEL CORPORATION v. DIXON.

(Filed 14 November, 1928.)

1. Evidence — Evidence at Former Trial — Admissions of Record in Former Trial.

A solemn admission put in record by the attorneys of a party are admissible in evidence against him in a subsequent action brought by him against a third party when the second action involves the same question.

CiyiL action, beard by *Small, J.,*a.t Second May Term, 1928, of Alamance.

Plaintiff instituted an action against tbe defendant in tbe court of a justice of tbe peace to recover the sum .of $100 upon a stock subscription note for one share of stock in plaintiff corporation. Tbe defendant admitted tbe execution of the note, but alleged that tbe note was secured by tbe plaintiff in a stock-selling scheme in violation of tbe Blue Sky law in that tbe plaintiff procured tbe Hockenbury System to sell said stock wrongfully. Tbe plaintiff offered evidence tending to show that tbe stock of plaintiff was sold by citizens to various people in Burlington, *266including tbe plaintiff, in pursuance of a patriotic and local pride undertaking to secure a hotel, and that these citizens who sold said stock received no *compensation*for their services whatever, and that the Hocken-bury System solicited no stock subscriptions and sold no stock, but were employed for the purpose of advertising the project and of instructing, counseling and supervising teams of citizens who actually sold the stock. Mr. C. C. Haworth sold the stock in controversy to plaintiff. There was no evidence that Mr. Haworth received any compensation from any source whatever for the sale of said stock. The trial judge peremptorily instructed the jury to answer the issue of indebtedness in favor of the plaintiff.

From judgment upon the verdict the defendant appealed.

*Coulter, Cooper &*Can■ *for plaintiff.*

*J. Bolph Long for defendant.*

Bbogdek, J.

Is a pleading or solemn admission put in the record by the pleader’s attorneys admissible in evidence against the pleader in a suit by the pleader against a third party involving the same question ?

The defendant offered in evidence excerpts from the agreed statement of facts signed by counsel for plaintiff and constituting a part of the record in the case of *Burlington Hotel Corporation v. Bell.*This agreed statement of facts admitted that the Hockenbury System was employed to sell stock and receive a commission upon such sales. The plaintiff objected to the admission of this evidence, and the objection was sustained. In *Hotel Corporation v. Bell,*192 N. C., 620, 135 S. E., 616, the Court expressed doubt as to whether the contract between the Burlington Hotel Corporation and the Hockenbury System constituted an agency for selling stock as contemplated by law, but the decision was based upon the admission in the agreed statement of facts contained in the record in that case.

The courts generally hold that a pleading containing an admission is competent against the pleader, in a subsequent case, on behalf of a stranger. The rulings of courts of last resort upon the subject are assembled in 14 A. L. R., p. 56.. In this State the question was first considered in *Kiddie v. DeBrutz,*2 N. C., 420. This. decision was rendered in October, 1796, and held that an admission in an answer could be offered in- evidence against the defendant in an action by a third person. To the same effect is the ruling in *Bloxham v. Timber Corporation,*172 N. C., 37, 89 S. E., 1013, where it was held: “It is not necessary to the competency of a pleading, as an admission against the party, that it he one filed in an action between the same parties. A pleading filed in *267any action is competent against tbe party if be signed it or otherwise acquiesced in tbe statements contained in it, if sucb statements are material and otherwise competent as evidence in tbe cause on trial, not by way of estoppel, but as evidence, open to rebuttal, that be admitted sucb facts.” In tbe case at bar tbe defendant offered an agreed statement of facts signed by counsel for both parties in tbe former suit. Tbe rule with respect to admissions contained in pleadings apply to solemn admissions signed by counsel and set out in tbe record. Thus, in *Guy v. Manuel,*89 N. C., 84, tbe Court said: “For tbe admissions of attorneys in tbe conduct of an action are always admissible in evidence against their clients, especially when tbe admissions are of record. ‘The admissions of attorneys of record bind their clients in all matters relating to tbe progress and trial of tbe cause. In some cases they are conclusive, and may even be given in evidence upon a new trial, though previously to sucb trial tbe party give notice that be intends to withdraw them; or, though tbe pleadings be altered, provided tbe alterations do not relate to tbe admissions. But to this end they must be distinct and formal, or such as are termed solemn admissions, made for tbe express purpose of relaxing tbe stringency of some rule of practice, or of dispensing with tbe formal proof of some fact at tbe trial.’ ”

. However, while it is competent to introduce pleadings or solemn admissions as defined by law as evidence, nevertheless tbe admissions so admitted are not conclusive. Tbe party making sucb admissions has tbe legal right to show, if be can, that they were made under misapprehension or by inadvertence or mistake, or for tbe purpose of dispensing with formal proof, or that they were made for tbe purpose of presenting a particular point in tbe particular case under consideration. *Mason v. McCormick,*85 N. C., 226; *Adams v. Utley,*87 N. C., 356; *Smith v. Nimocks,*94 N. C., 243; *Norcum v. Savage,*140 N. C., 472, 53 S. E., 289; *Alsworth v. Cedar Works,*172 N. C., 17, 89 S. E., 1008; *Ledford v. Power Co.,*194 N. C., 98, 138 S. E., 424.

Tbe plaintiff relies upon tbe case of *Eigenbrun v. Smith,*98 N. C., 207, 4 S. E., 122. This case is not in point. Apparently tbe pleading was offered to contradict tbe statement of a witness who was not a party to tbe action.

Tbe exclusion of tbe evidence so offered by tbe defendant was error warranting a

New trial.