Case Name: C. T. PEELE v. ISA G. POWELL, Administratrix
Court: Supreme Court of North Carolina
Jurisdiction: North Carolina
Decision Date: 1911-11-09
Citations: 156 N.C. 553
Docket Number: 
Parties: C. T. PEELE v. ISA G. POWELL, Administratrix.
Judges: Justice Hoke concurs in the dissenting opinion of Justice 'WALKER.
Reporter: North Carolina Reports
Volume: 156
Pages: 553–569

Head Matter:
C. T. PEELE v. ISA G. POWELL, Administratrix.
(Filed 9 November, 1911.)
1. Statute of Frauds — Debt or Default of Another — Parol Promise— Original Liability.
Tlie liability of a promisor to answer, “upon special promise, the debt, default, or miscarriage' of another person” under the statute of frauds, is governed by whether the promise creates an original obligation or is collateral to it and merely superadded to the promise of another to pay the debt, he remaining liable, for in the latter instance the promisor is not liable unless there is a writing to that effect, whether the promise is made at the time the debt is created or not.
2. Same — Credit.
The obligation o'f a promisor to answer for the “debt, default, or miscarriage of another” is original and binding if made at the time or before the debt is created, when the credit is given solely to the promisor or to both.
3. Same — Express Promise — Consideration—Evidence.
To make the oral special promise binding upon the promisor to answer for the debt, etc., of another, the promise must be express and not solely implied by law, and founded upon a con sideration such as the immediate and pecuniary benefit of the promisor in the transaction, as in instances of joint principals, or the release of the original debtor, or harm or benefit passing between the promisor and the creditor, or to pay out of a particular fund of the debtor in the hands of the promisor; but if the funds are not actually in his hands and he does not receive them, his promise is not personally binding.
4. Statute of Frauds — Debt or Default of Another — Consideration Expressed — Implication.
A written promise to answer for the debt, etc., of another need not express the consideration, and it may be established by parol.
5. Statute of Frauds — Debt or Default of Another — Parol Promise— Liability — Definition.
A parol promise to answer for the debt, etc., of another which is not enforcible is defined to be “an undertaking by a person not before liable, for the purpose of securing or performing the same duty for which the party for whom the undertaking is made continues liable.” Sheppard v. 'Newton, 139 N. C., 535, cited and approved.
6. Statute of Frauds — Debt or Default of Another — Evidence of Debt — Deceased—Transactions and Communications.
In an action upon the special promise of the deceased, against his administrator, for goods sold and delivered to another, it is competent for the plaintiff to imove the indebtedness of such other person by his verified account and other competent evidence, as such would not involve evidence of transactions and communications with a deceased person, prohibited by statute, but to recover of the estate of the deceased, the promise to answer for the debt must be shown in a manner not prohibited by the statute of frauds.
7. Statute of Frauds — Debt or Default of Another — Promise—Running Accounts — Specific Occasion — Evidence.
In an action against a promisor to recover on an account for goods sold and delivered, there was testimony by a witness, an employee of the plaintiff, that about the time of the sale of the last item the plaintiff told him not to let the debtor have any more goods without the written order of the promisor; that the debtor had no credit: Held, evidence that the debtor had credit prior to that time, and a general statement made by the witness that the goods had been theretofore sold on the credit extended the promisor must be accompanied by evidence of something said or done by the promisor authorizing the extension of credit, to have any weight.
8. Statute of Frauds — Debt or Default of Another — Promise—Insufficient Evidence.
In an action to hold an alleged promisor liable for a running account of goods sold to another, evidence that the promisor told the plaintiff to let the debtor have goods and he would see that they were paid for, without anything to show that goods were , sold the debtor at that time, should not be construed as prospective and retrospective, so as to include goods sold before and after that time.
9. Same — Declarations.
Evidence of a parol declaration of a promisor to pay the debt of another, in an action upon the promise, that the promisor had „ told the plaintiff that the debt was all right, is not sufficient to make the promisor liable.
10. Evidence — Running Account — Book Items.
In an action upon a running account, the items appearing upon the ledger and day-book of the plaintiff are mere declarations in his own interest, and as such are incompetent when standing alone and unsupported by proper evidence to make them competent.
Walker, J., dissenting; Hoke, J., concurring in dissenting opinion.
Appeal from Garter, J., at May Term, 1911, of Beetle.
This is an action brought by C. T. Peele against Isa Gr. Powell, administratrix of Edgar Powell, to recover $286.65 and interest thereon from 27 March, 1907, the value of goods sold and delivered to J. T. Cook, for which it is alleged the defendant’s intestate is liable.
The plaintiff offered the following evidence: An itemized and verified statement of account of goods sold and delivered to J. T. Cook for the amount alleged to be due by him in his complaint. Objection by defendant sustained, and plaintiff excepted.
The account was against Tom Cook, Edgar Powell, security. Luther Bryant testified: That he was clerk in plaintiff’s store from 1 January, 1906, till the end of the year 1908; that for all goods sold to J. T. Cook from 22 February, 1906, to 27 March, 1907, the credit therefor was extended to Edgar Powell; that about the time of the last-mentioned date Mr. Peele told him (the witness) not to let Mr. Cook have any more goods without a written order from Mr. Powell. Cook had no credit at that time and was a tenant of Mr. Powell. That in July, 1906, he heard Powell tell plaintiff to let Cook have goods and he would see that they were paid for.
E. L. Bishop testified as follows: “On or about 25 March, 1908, I met Mr. Powell in the road, and in the conversation between us, Mr. Powell stated that Mr. Peele had him charged with a great big account that Mr. Cook had made at his store, and that he did not think that he ought to pay it, because Mr. Peele ought not to have let Mr. Cook have so many goods on such a crop as Mr. Cook was then working, but that he (Mr. Powell) had told Mr. Peele to let Mr. Cook have some goods, and that he reckoned he would have to pay it. I then told Mr. Powell what Mr. Peele had told me to tell him; that he presented Mr. Cook’s account to him (Powell), and unless he made some arrangements about that account, that he (Peele) was going to take some steps to collect it; that Mr. Peele said that he hated to take such measures against him, and that he wanted to avoid it if possible, but that he could not afford to lose the account.”
L. J. Brewer testified: That in March, 1906, he was at Powell’s house and saw some one going out the gate, and that he asked Mr. Powell who it was, and he replied that it was Charlie Peele, who had been to see him about Cook’s account, and that he told him that it was all right. He testified, also, that on another occasion, at the sheep shelter, in 1908, that Mr. Powell told him that Mr. Peele had a large account against him for Tom Cook, and that it amounted to about $290.
The.plaintiff offered to prove by himself that he sold the goods to Cook, and the amount of the sales, which was excluded, and the plaintiff excepted. He also offered in evidence his ledger and day-book, for the purpose of proving the account against Cook, and excepted to its exclusion.
The principal controversy between the plaintiff and the defendant is as to the effect of the evidence, the defendant contending that it is not sufficient, under the statute of frauds, to bind the estate of his intestate.
His Honor was of tbis opinion, and upon the conclusion of the evidence entered judgment of nonsuit, and the plaintiff excepted and appealed.
L. L. Smith for plaintiff.
Winston & Matthews for defendant.

Opinion:
AllbN, J.,
after stating the case: The liability of a promisor to answer, "upon special promise, the debt, default, or miscarriage of another person" has been considered in numerous decisions of this Court, and there is frequently much difficulty in determining whether a particular promise is within the statute.
The term "special promise" means an express promise, and not one implied by law. Browne Stat. Frauds, sec. 166.
Whether oral or in writing, it must have a consideration to support it (Draughon v. Bunting, 31 N. C., 10; Stanly v. Hendrix, 35 N. C., 87; Combs v. Harshaw, 63 N. C., 198; Haun v. Burrell, 119 N. C., 547); but if in writing, the consideration need not appear in the writing, and may be shown by parol. Nichols v. Bell, 46 N. C., 32; Haun v. Burrell, 119 N. C., 547.
If the promise is based on a consideration, and is an original obligation, it is valid, although not in writing. Hospital Assn. v. Hobbs, 153 N. C., 188.
The obligation is original if made at the time or before the-debt is created and the credit is given solely to the promisor, as in Morrison v. Baker, 81 N. C., 80; Sheppard v. Newton, 139 N. C., 536, or if credit is given on the promises of both, as principals and as jointly liable, and not on the promise of one as the surety for the other. Browne Stat. Frauds, sec. 197; Horne v. Bank, 108 N. C., 119.
So is a promise, made after the debt is created, when by reason of the promise the original debtor is released (Sheppard v. Newton, 139 N. C., 379; Jenkins v. Holly, 140 N. C., 379), and also if it is a promise to pay out of funds placed in the hands of the promisor by the debtor (Stanly v. Hendrix, 35 N. C., 86; Threadgill v. McLendon, 76 N. C., 24; Mason v. Wilson, 84 N. C., 53; Voorhees v. Porter, 134 N. C., 604), or if a promise based on a new consideration of benefit or harm passing between the promisor and the creditor. Whitehurst v. Hyman, 90 N. C., 489.
If, however, there is a promise to pay out of a particular fund, and the fund is not received by the promisor, it is not binding. Bagley v. Sasser, 55 N. C., 350.
If one, under the former practice, .was arrested in a civil action, and was released on the oral promise of another to pay the' debt, the promise was binding because the release from arrest satisfied the original debt (Cooper v. Chambers, 15 N. C., 261; Draughon v. Bunting, 31 N. C., 10), but it was otherwise of an oral promise to pay upon condition that the creditor would not arrest the debtor, because the debtor remained liable. Britton v. Thrailkill, 50 N. C., 331; Rogers v. Rogers, 51 N. C., 300; Combs v. Harshaw, 63 N. C., 198.
Where the promise is for the benefit of the promisor, and he has a personal, immediate, and jmcuniary benefit in the transaction, as. in Neal v. Bellamy, 73 N. C., 384, and in Dale v. Lumber Co., 152 N. C., 653, or where the promise to pay the debt of another is all or part of the consideration for property conveyed to the promisor, as in Hockaday v. Parker, 53 N. C., 17; Little v. McCarter, 89 N. C., 233; Deaver v. Deaver, 137 N. C., 242; Satterfield v. Kindley, 144 N. C., 455; or is a promise to make good notes transferred in payment of property, as in Adcock v. Fleming, 19 N. C., 225; Ashford v. Robinson, 30 N. C., 114, and in Rowland v. Rorke, 49 N. C., 337, the promise is valid although in parol.
If, however, the promise does not create an original obligation, and it is collateral, and is merely superadded to the promise of another to pay the debt, he remaining liable, the promisor is not liable, unless there is a writing; and this is true whether made at the time the debt is created or not. Smithwick v. Shepherd, 49 N. C., 197; Bagley v. Sasser, 55 N. C., 350; Scott v. Bryan, 73 N. C., 582; Rowland v. Barnes, 81 N. C., 239; Haun v. Burrell, 119 N. C., 547; Garrett-Williams Co. v. Hamill, 131 N. C., 59; Sheppard v. Newton, 139 N. C., 535, and Supply Co. v. Finch, 147 N. C., 106.
'In our opinion, this case falls within the last class.
There is no evidence of benefit to the intestate, and while the jury would have been justified in finding from the evidence tbat be promised to pay, it is not sufficient to sustain a finding tbat it was more than a promise to pay tbe debt of Cook, for wbicb be (Cook) remained liable.
Tbe verified account and tbe evidence of tbe plaintiff were competent to prove tbe indebtedness of Cook, as neither involved a transaction or conversation witb tbe deceased, and there would be error in their exclusion, wbicb would entitle tbe plaintifE to a new trial, if there was evidence of a valid promise of tbe intestate to pay.
It was because bis Honor thought there was no such evidence tbat be ruled as be did, and we concur in bis opinion.
Tbe definition of a promise to answer for tbe debt 'of another, wbicb is not enforcible, adopted in our Court and applicable here, is: "An undertaking by a person not before liable, for tbe purpose of securing or performing tbe same duty for wbicb tbe party for whom tbe undertaking is made continues liable." Sheppard v. Newton, supra. Tested by this rule, we think tbe action cannot be maintained.
Tbe account began on 22 February, 1906, and ended 27 March, 1907. Tbe witness for tbe plaintiff, Bryant, testified, tbat about tbe time of tbe last date (27 March, 1907) tbe plaintiff told him not to let Cook have any more goods without a written order from Powell, and tbat Cook bad no credit at tbat time. Tbe inference is that Cook bad credit prior to tbe time, and no goods were afterwards sold to him. It is true tbat same witness also said tbat for all goods sold to Cook, credit was extended to Powell; and this would be entitled to great weight if be bad stated something said or done by Powell authorizing tbe extension of credit. A similar statement was made by a witness in Garrett-Williams Co. v. Hamill, 131 N. C., 59, and was held insufficient to charge tbe promisor.
Again he says, in July, 1906, he beard Powell tell the plaintiff to let Cook have goods, and be would see tbat they were paid for. He does not state whether or not any goods were sold to Cook at tbat time, and so far as we can see, tbe promise related to a single transaction, and there is no evidence tbat it is embraced in tbe account sued on.
We would not be justified in giving sueb a promise both a retrospective and prospective construction, to include the part of the account before the promise and that part made after it.
The evidence of the witnesses Brewer and Bishop does not show liability on the part of the intestate.
The most material statement made by either is by Brewer: "That in March, 1906, he was at Powell's house and saw some one going out the gate, and that he asked Mr. Powell who it was, and he replied that it was Charlie Peele, who had been to see him about Cook's account, and that he told him that it was all right."
We will assume that "him," as last used, applies to Peele, although it is not certain; but, if so, it was "Cook's account" that was all right, and there is no suggestion in the evidence that Cook was not liable therefor. Suppose he had said, "Cook owes Peele an account, and I have promised to pay it." No one would contend that this would create a legal liability, and the evidence is not as strong as this.
The action is against the estate of a deceased person. The intestate lived one year and eight months after the last item in the account, and no action was instituted against him during 'this period. The defendant administratrix has no personal knowledge of the transactions, and death has destroyed any opportunity of replying to the evidence of the plaintiff. Under these circumstances the evidence should be carefully examined, and if it does not conform to the requirements of the law, it should be so declared.
The ledger and day-book of the plaintiff were properly excluded, as they were mere declarations of the plaintiff in his own interest. Bank v. Clark, 8 N. C., 36; Bland v. Warren, 65 N. C., 374; Dyeing Co. v. Hosiery Co., 126 N. C., 294.
We find
No error.