Court Opinion

ID: 3876612
Source: CourtListenerOpinion
Date Created: 2016-07-06 09:09:25.347842+00
Date Added: 2024-06-11T11:51:59.885577
License: Public Domain

April 20, 1914. The opinion of the Court was delivered by
This was an action for foreclosure and sale by plaintiff against the defendants, commenced August 23, 1913. After issue joined it was referred to the master to take testimony. Upon the pleadings in the case, and the testimony taken by the master, the cause was heard by his Honor, Judge Shipp. *Page 143 
at the October term of the Court, 1913, and he subsequently, to wit, December 19, 1913, filed his decree in favor of the plaintiff. For a proper understanding of the case his decree should be embodied in a report of the case. After entry of judgment the Farmers Bank duly appealed therefrom. The exceptions, twenty-two in number, will not be taken upseriatim, but only the questions raised by them considered. The first question, covered by the first seven exceptions, is that there was not sufficient evidence to allow secondary evidence of the alleged assignment to be offered at all, and even if it was sufficient to let in secondary evidence the evidence offered did not prove the assignment. The execution of the note and mortgage are not denied, there was testimony that the plaintiff's money paid for the mortgage and note, and that they were delivered to her husband, who was her agent, and his Honor held that there was sufficient evidence of the assignment in equity independent of any written assignment and to this holding there was no exception. As was said in Stoddard v. Hill, 38 S.C. 385, 17 S.E. 138: "An assignment of note and mortgage is not required by law to be executed in the presence of witnesses, and, therefore, when unattested by a subscribing witness, may be proved by any one who was present and saw the assignment executed. * * * The complaint avers that the plaintiff is now the legal owner and holder of said mortgage. The note is payable to bearer. In Coleman v. Dunlap, 18 S.C. 594, it was held when a note was payable to bearer, and plaintiff stated he was the owner of the note, that inasmuch as he had possession of the note, which itself was prima facie
evidence of ownership, such statement was admissible, and was all that was necessary to sustain the action." Stoddard
v. Hill, 38 S.C. 392, 17 S.E. 138. There is no question but that the plaintiff was in possession of the note and mortgage in dispute, and there is no evidence that anything has ever been paid to her thereon. *Page 144 
There was evidence that after plaintiff got in her possession the note and mortgage that they were deposited in defendant's bank with other papers for safe-keeping, and after a thorough search by the Talberts of every conceivable place, other than the bank, they cannot be found. Notice was given the bank to produce the papers, and they testified that the papers were not in the bank. We do not think his Honor was in error in finding that the papers were lost, and in allowing the contents of the assignment to be shown by secondary evidence. The appellant fails to convince us that his Honor was in error in finding the assignment was to plaintiff as the evidence convinces us that in fact the assignment was to plaintiff, M.L. Talbert, and that she purchased the same, and that the note and mortgage were assigned to her, and she got possession of them from the Bank of McCormick, the owners and holders of the same, on February 20, 1909, that it was open and unsatisfied on that day, and being in possession of the same she was prima facie the owner and holder of the same, and the burden is on the defendant to show payment, satisfaction, or that she is not the owner and holder of the same.
These exceptions are overruled.
The other exceptions impute error to his Honor in holding that the plaintiff was the owner and holder of the note and mortgage, was bona fide innocent purchaser for value, and in not holding that she was a fraudulent holder, and that she had no interest in it, and that the money paid the Bank of McCormick was in fact the money of John L. Talbert, and that the mortgage was thereby satisfied, but kept open and held by his mother in order to enable John L. Talbert to take in, cheat and defraud his creditors, especially the defendant, and retained the same in her possession unsatisfied in order that John L. Talbert might in the future swindle some one, and that there was a conspiracy entered into between the plaintiff and John L. Talbert for the purpose of defrauding the creditors of John L. Talbert, especially the Farmers *Page 145 
Bank, and that all parties to the transaction were guilty of moral fraud, and that the whole transaction was null and void for this reason, and that he should have found further that Talbert (John L.) was largely in debt at the time of alleged assignment, and that the transfer of the note and the mortgage to the mother was made with intent to delay, hinder, and defraud his creditors, and was therefore null and void.
All the evidence as to communications that John L. Talbert had with the officers of the bank, defendant, and all other parties, when the plaintiff was not present, was objected to when the testimony was taken. This objection was proper and must be sustained as the plaintiff could not be bound or affected by any statement made by John L. Talbert in reference to the transfer and assignment or payment of the note and mortgage in her possession when she was not present when the statement was made. It is true, that the plaintiff purchased the note and mortgage shortly after its maturity. If it be a negotiable note purchased before maturity and transferred before maturity it would have carried with it the same protection to the mortgage its accessory as such paper is entitled to.Carpenter v. Longan, 16 Wall. 271; Dearman v. Trimmier,26 S.C. 506, 2 S.E. 501; Patterson v. Rabb, 38 S.C. 138,17 S.E. 463. But there is no contest between her and the maker of the mortgage, they both agree that the mortgage is unpaid and unsatisfied, and the defendant bank is the one who assails it. It is in evidence that the Farmers Bank was not an existing creditor of John L. Talbert at the time of the alleged assignment of the mortgage in suit. The evidence fails to disclose any outstanding indebtedness on the part of John L. Talbert on February 20, 1909, except the debt due his mother. It is true he had been unfortunate and failed in business before this, but his indebtedness had been compromised and settled. No creditor, who was in existence at that time of John Talbert, is before the Court contesting the *Page 146 
rights of the plaintiff. The claim of the appellant did not arise until 1910, nearly two years after the alleged assignment. All of John L. Talbert's creditors, including the Farmers Bank, are subsequent to the assignment, and none are contesting except the Farmers Bank. It was unfortunate that the bank relied on the statement of the officers of the Bank of McCormick that the note and mortgage had been paid, if they made any such statement, the mortgage was on record open and unsatisfied. On December 21, 1910, he gave a mortgage to the Farmers Bank, and on February 9, 1911, he gave another to this bank, and informed Cashier Robinson that the mortgage had been paid. Robinson went to the Bank of McCormick, and on January 20, 1912, got from Britt, cashier, a certificate that the mortgage of John L. Talbert to them (the one now in suit) had been paid. There is no pretense that there is any evidence that the plaintiff was present when the conversations, transactions, and statements were made by John L. Talbert, and Britt to Robinson, and she cannot be bound or affected thereby. If she was the owner and holder of the note and mortgage neither the debtor, Talbert, nor the Bank of McCormick, could legally have it marked satisfied. There is sufficient evidence in the case to find that the appellant was put on notice that the mortgage was open and unsatisfied, and sufficient evidence to charge it with notice that M. L. Talbert claimed some interest therein sufficient for it to make inquiry, and there is sufficient evidence to conclude that Robinson was aware of this fact, and that he failed to investigate sufficiently, but relied on statements of John L. Talbert and Britt. The bank extended credit in first instance with mortgage open, and continued to do so nearly three years after he was deceived by the statement of John L. Talbert. We do not think under the evidence in the case that there was actual or moral fraud in the case, or that the assignment was made with intent to hinder, delay, defeat, or defraud any creditor, or that the assignment was fraudulent *Page 147 
as to subsequent creditors under the cases of Walker, Evans Cogswell v. Bollemann Bros., 22 S.C. 512; Jackson v.Plyer, 38 S.C. 498, 17 S.E. 255; Gentry v. Lanneau, 54 S.C. 514,32 S.E. 523.
We do not think under the evidence that the assignment should be set aside as being fraudulent and voluntary either under the Statute of Elizabeth or the assignment act. Cut out the incompetent evidence of John L. Talbert and other witnesses as to statements made by them at various times in reference to the mortgage being paid, and the various transactions of John L. Talbert, which she confessedly had nothing to do with, etc., incompetent by reason of the fact that the plaintiff was not present, and no pretense that she knew of, had notice or authorized any such statements and the evidence to make out defendant's charges and allegations against plaintiff is vague, meagre, indefinite, and unsatisfactory, and does not satisfy, by the preponderance of the evidence the truth of the charge. The appellant has failed to convince us that the transaction, in reference to the assignment and transfer of the assignment, was voluntary, or that there was actual and positive fraud; on the contrary, we are satisfied with the findings and decree of the Circuit Judge, and we see no reason why any of the exceptions should be sustained. All exceptions are overruled.
Judgment affirmed.