Dawson v. Thigpen.

Connor, J., after stating the facts. The assignments of error present but two questions for our consideration: Eirst, the right of the plaintiff to withdraw from the action pending the controversy, by taking a nonsuit. lie had, by the order of the Court, at the institution of the action, procured the seizure of the property and the defendants had retained it by filing the undertaking, which was available to the plaintiff only in the event of a recovery. While the complaint does not set out the source of the plaintiff’s claim to the property, it does allege an indebtedness by the defendants, and they in their answer admit the execution of a mortgage to the plaintiff to secure the payment of the same indebtedness. It is also manifest from the pleadings that the controversy arose out of conflicting claims, based upon several mortgages executed by defendant Thigpen to the plaintiff and the inter-pleader. It is well settled that in an action involving the title to property, an interpleader is restricted to the issue as *468 to bis title or claim to tbe property, and cannot raise or litigate questions or rights which do not affect such title. McLean v. Douglass, 28 N. C., 233. He does not, speaking with accuracy, become a party to the action in the same sense and with the same status as the original parties, or those made so pending the action either by the Court ex mero motu or upon application. In McKesson v. Mendenhall, 64 N. C., 502, Rodman, J., states the rule in regard to the rights of the original plaintiff to take a voluntary nonsuit: “The principle seems to be that a plaintiff may elect to be nonsuited in every case when no judgment, other than for costs, can be recovered against him by the defendant, and when such judgment can be recovered, he cannot.” If the plaintiff had taken the property into his possession and retained it, he could not, either as against the defendant or the interpleader, have submitted to a nonsuit and gone out of court by simply paying the costs. Manix v. Howard, 82 N. C., 125. In the case before us, the property having been retained by the defendants, it was open to the interpleader by complying with the provision of section 331 of The Code, to either secure possession of the property or an undertaking for its delivery or the value thereof. It would seem to be clear that in no event could the inter pleader recover any other judgment against the plaintiff than for costs. If he had received from the defendants crops to which the interpleader was entitled he was liable therefor in a separate action. By moving for judgment of nonsuit, the plaintiff conceded that he was not entitled to the property in controversy. This was all that in any event the interpleader, as against the plaintiff, was entitled to. We are of opinion that his Honor* properly permitted the plaintiff to submit to the nonsuit. In McKesson v. Mendenhall, supra, it is held that although nonsuited, tire action would go on for the interpleader, and the person nonsuited would be bound by the result of the suit *469 as privy thereto. This is an additional reason for sustaining tbe ruling of tbe Oonrt below. The plaintiff is bound by his action, and cannot again assert title to the property. This in no degree affected the right of the interpleaders to litigate as between themselves the title to the property and their interests therein. In regard to the second assignment of error: The instruction of the jury that the mules were the property of Stancil. We are of opinion that his Honor should have submitted to the jury the question .as to the intent with which the second mortgage was executed by Thigpen and received by the inter-pleader. It will be noted that she held the mortgage on the personal property, recorded January 27, 1900, and that on February 2, 1901, the mortgagor signed and sent to' her a mortgage by one D. E. Oobb. Oobb testified that he was not her .agent and had never been, and that he simply delivered the mortgage to her. The defendant Thigpen testified that he executed a mortgage of January, 1900, and that he prepared a new note and lien and gave it to Oobb, January, 1901; that there was no .agreement between them; that it was given to renew the debt due November 1, 1900. She retained both notes and mortgages. It may well be that she accepted the note and mortgage of 1901 for the purpose of securing a mortgage on the crop of that year, retaining the original mortgage as the first lien on the personal property. Thigpen had executed a mortgage on the same property to Stancil, recorded March 5, 1900. If she had notice of this mortgage, it would explain her conduct in retaining her mortgage registered prior thereto. However this may be, it was a question for the jury to decide. In Smith v. Bynum, 92 N. C., 108, it was held that when there was a settlement between the mortgagor and mortgagee, and a new note and mortgage taken, the property in the first mortgage was released. Ashe, J., says: “If the plaintiff had *470 not come to a settlement with the mortgagor and taken a new note with another mortgage to secure it, his lien under that mortgage would have continued and he would have had the right to recover in this action; but by his settlement, etc., the mortgage of January, 1882, was discharged.” The decision is based upon the fact that the parties came to a settlement. In Joyner v. Stancill, 108 N. C., 153, the referee expressly found that Stancill “accepted said note in full satisfaction of, and in payment of and in discharge of said Rountree & Co.’s note * * * and treated it as a discharge of preexisting securities.” Shepherd, J., after reviewing the decision, says that “The finding of the referee is explicit upon this point, that the new note was accepted in full satisfaction of and in payment of the former one.” These cases are distinguished from Hyman v. Devereux, 63 N. C., 624; Vick v. Smith, 83 N. C., 80, and Collins v. Davis, 132 N. C., 106, by the fact that a settlement was had and a new note taken in payment of the discharge of the original. The general rule is well settled that the taking of a second note and mortgage, of itself, does not discharge the original security, unless it is intended so to operate. Jones on Mortgages (6 Ed.), see. 924. “Whether a new note shall be treated and have effect between the parties as a payment of a former one for which it is substituted, will depend upon the purpose and understanding of the parties to the transaction; but not only will the intention of the parties be determined by the express agreement of the parties, but, in the absence of this, by the circumstances attending the transaction from which such intention may be inferred. * * * In the absence of any express agreement and of .any circumstances showing intention, the renewal of the note does not affect the security. The burden is upon the mortgagor to show the existence of an agreement that the mortgage lien should be released upon the execution of the new note, and not upon the mortgagee to *471 show an agreement that tbe mortgage should continue as a security for tbe debt covered by tbe new note.” Iiid., sec. 926. Again, “tbe taking of further security for tbe mortgage debt, whether it be by a second mortgage upon tbe same land, or real or personal security upon other property, is generally no waiver of tbe original mortgage.” Ibid., sec. 929. There was evidence fit to be considered by tbe jury upon tbe issue, with what intent Thigpen executed and Mrs. Mc-Duffie received tbe note and mortgage of January 1, 1901. This exception of Mrs. McDuffie therefore must be sustained and a new trial ordered upon tbe third, sixth and ninth issues. In view of our decision, we are of opinion that tbe costs should be divided equally between tbe appellant Mrs. Mc-Duffie and tbe interpleader Stancil. Let this be certified to tbe Court below. New Trial.