Court Opinion

ID: 3248366
Source: CourtListenerOpinion
Date Created: 2016-07-05 16:20:03.808231+00
Date Added: 2024-06-11T13:39:06.857679
License: Public Domain

I cannot concur in that part of the foregoing opinion indicated below. As to the general result, I am not prepared to hold that the reversal should not enter.
The majority of the court have proceeded to their conclusion upon a legal premise, stated in the foregoing opinion, which appears to me manifestly unsound, and attribute to First National Bank v. Allen, 100 Ala. 476, 485, 14 So. 335,27 L.R.A. 426, 46 Am. St. Rep. 80, and Pollack v. Gunter, 162 Ala. 317,320, 50 So. 155, an authoritative effect upon a case to which the doctrine there recognized is wholly inapplicable. In this state the jurisdictions of law and equity are distinct; this to discriminate the general statement in 1 C. J. p. 715, § 356. In the premise to which the majority give sanction they have treated the case as being one simply on a stated account, whereas in the bill it is alleged that a complete settlement was had between the parties "as to the amount of indebtedness due by them [respondents] to him [complainant], and * * * said respondents executed to your complainant their promissory note, given to secure the amount which said respondents agreed and admitted was due your complainant by them, * * *" and "executed to your complainant a mortgage" to secure the promissory note. The applicable principles of law are fully stated in the leading case of Paulling v. Creagh, 54 Ala. 646, 651, 653, and in Scheuer v. Berringer, 102 Ala. 216, 220, 221, 14 So. 640, among other readily accessible decisions in that line. In the latter case (102 Ala. 220, 14 So. 641), in the opinion of the chancellor to which this court gave its unqualified approval, it was said:
"When parties who are sui juris make a final settlement between themselves, such settlement is as binding on them in many respects as a decree of a court. Such settlement may be opened for fraud, accident or mistake."
In the former case (54 Ala. 651, 652) it was said:
"There had been mutual dealings between him and Creagh, of which an account was rendered; he had full opportunity of examining, and full knowledge, or the means of acquiring it, of the correctness or incorrectness of the items composing the account. The account was closed by the execution of promissory notes for the balance claimed, and more than two years after executing them, and after Creagh's death, a deed of trust is executed to secure their payment.
"This settlement is not conclusive on the complainant; does not estop him from being relieved in equity from any fraud or imposition which may have been practiced on him in making it; or from obtaining the correction of any errors or omissions which may be found to have entered into it. A court of equity has ample authority to open and re-examine an account stated, if there has been mistake, accident, fraud or undue advantage, by which the account is vitiated and the balance incorrectly fixed. 1 Story, Eq. § 523. The jurisdiction is cautiously exercised; only on clear and precise allegations, supported by proof of fraud, undue advantage, accident or mistake. * * *
"In Drew v. Power, supra (1 Sch.  Lef. 192), it was said by Lord Redesdale, 'One rule material to observe in all cases of account is, that where there has been a settlement of accounts and either the account has been signed or a security taken on the footing of the account, a court of equity does not open that transaction and throw it again between the parties as if no such transaction had happened, unless the evidence which is produced (and that evidence founded on charges in the bill) shows the whole transaction to be so iniquitous that it ought not to be brought forward at all to affect the party sought to be bound. If the account impeached be a settled account, or if an instrument has been executed on the foot of it, the court expects that the errors should be specified in the bill and proved as specified; otherwise it would be easy to overturn the fairest accounts and those settled in the most solemn manner when there happens to be any complication in their nature.' When an account is stated and settled by the giving of an independent security, that security becomes prima facie a debt owing according to its terms. It cannot *Page 668 
be overturned on merely doubtful or probable testimony that errors intervened in the accounts which were settled, without imparting to all business transactions insecurity and uncertainty."
It appears indisputable from these and other authorities that the matter of impeaching a settled account and of destroying or impairing the independent security given upon the basis of the settlement so made because of fraud, accident, or mistake in respect of items of the account agreed upon and settled and security for the net sum given, as here, can only be effectually asserted in a court of equity, and not in a court of law, as the majority of this court have held in the foregoing opinion. It is unnecessary to elaborate the statement at this time, in view of the full opinions in the cases of Paulling v. Creagh and Scheuer v. Berringer, supra, among others.
I therefore disagree with the opinion in the particular indicated. Upon the result — reversal — it is not necessary to express a conclusion.
ANDERSON, C. J., concurs in the conclusion reached by the majority, but concurs in the legal principles stated in the opinion of McCLELLAN, J.