McEachin v. . Stewart

MerkimoN, C. J.: For the present purpose, the allegations of the complaint must be accepted as true. It would be better if they were in some respects fuller, more explicit and orderly than they are; but the Court can certainly see by the complaint, taken as a whole, that a cause of action is alleged with sufficient certainty to enable it to give the judgment demanded, or some other appropriate judgment. Moreover, it gives the defendant such information in regard to *342 the cause of action alleged as will enable him to make any defence he may have. If, in some possible respect, he may desire a more explicit allegation, he may ask the Court to require it to be made. When a pleading is substantially sufficient, it should be upheld. While the rights of parties in pleading should be carefully recognized and protected, merely captious and vexatious objections should not be tolerated, much less encouraged It is better and just to meet the merits of the matter in litigation as promptly as practicable. It is alleged, in substance, in the complaint, that the Court, having control of five hundred dollars belonging to the plaintiffs, by proper order, directed the appellant defendant, as Clerk of the Court, to “invest either in real estate or United States bonds, said sum, or in some safe securities, and receive and pay over the interest,” &c.; that he did not observe this order and so invest the money; that, on the contrary, he fraudulently, and for his own purposes and benefit, loaned the money to his brother, taking a third mortgage of a tract of land as security therefor, he having a second mortgage of the same land to secure a debt of his own, and using the mone} of the plaintiffs to discharge, in large part, the first mortgage debt in favor of his second mortgage; that afterwards he procured his own mortgage to be foreclosed, purchasing the land under the judgment of foreclosure, through his agent, at a price much less than sufficient to pay his own mortgage debt, the mortgagor being his brother, and insolvent, whereby the plaintiffs were injured, <fec. The facts stated informally, but sufficiently in detail, imply more than mere evidence of fraud — taken in connection with the nature of the cause of action, the duty of the appellant under the order directing him to invest the money, the allegations of the tenth paragraph of the complaint, they imply a charge of fraud against the defendant *343 appellant, although such fraud is not in terms in the orderly-connection, formally alleged. The grounds of demurrer assigued are not sustained by what appears and fails to appear in the complaint. It is alleged, largely in terms, and by the strongest implication, that the appellee did act, not only improvidently, but dishonestly in his own interest in purporting to make the investment. The facts constituting the alleged fraud — that appellee purchased the land in fraud of the rights of the plaintiffs, and was false to the trust with which' he was charged — are stated informally, much in detail. The Court can readily see them and determine their legal import and application. No doubt the plaintiffs might have another or other remedy than that they are now prosecuting. But if the allegations of the complaint are well founded, and this clearly appears, they have the right to follow the fund and charge the land embraced by-the mortgages mentioned with, the money due them, they sustaining, in effect, the relation of first mortgagees to it, because through, and by means of, the alleged fraud of the appellee, their money was used to relieve the land of the first mortgage for his benefit. This rests upon the well settled principle of equity, that when the trust money can be clearly traced, a Court of Equity will charge a trust upon the land in which it has been invested in favor of the person entitled beneficially to the money. The cestui que trust is not bound to thus follow the fund; he may do so. Freeman v. Cook, 6 Ired. Eq., 373; Bank v. Simonton, 86 N. C., 187; Murray v. Lylburn, 2 John., Ch. R., 441; Oliver v. Peate, 3 How. (U. S.), 333; May v. LeClaire, 11 Wall., 217; 2 Story Eq. Jur., § 1210; Ad. Eq., 143. The demurrer, for the -purpose of the pleading, admits the facts as alleged in the complaint. What we have said is based upon the supposition that the facts as alleged are true, but it may turn out that they are not. *344 There is error. The judgment must be reversed, and judgment entered overruling the demurrer, with leave to the defendant appellee to answer. To that end, let this opinion be certified to the Superior Court It is so .ordered. Error.