Meyers v. . Allsbrook

ERVIN, J. The defendant asserts that the nonsuit might well be sustained on the ground that the evidence shows that in his transactions with plaintiff he acted solely as agent for Joe Allsbrook, a disclosed principal; that any promise he may have made to plaintiff to pay the check for $4,175 was simply a promise to make payment of a debt of his principal out of assets of his principal subject to his control as agent; and that both he and the plaintiff understood that he did not undertake to assume any obligation of his principal as a personal liability. Way v. Ramsey, 192 N. C. 549, 135 S. E. 454; Davis v. Burnett, 49 N. C. 71, 67 Am. Dec. 263; McCall v. Clayton, 44 N. C. 422; Meadows v. Smith, 34 N. C. 18. To be sure, the testimony is susceptible of this construction. Interpreted most favorably for plaintiff, however, the evidence is sufficient to justify an alternative finding by a jury that the defendant promised to pay to plaintiff the pre-existing obligation of Joe Allsbrook to plaintiff evidenced by the $4,175 check in consideration of the plaintiff extending the time for the payment of such obligation for “about two weeks” and refraining from taking legal action against Joe Allsbrook or his property upon such obligation during such period. But since the promise shown by this view of the testimony was made to plaintiff by defendant byword of mouth only, we are confronted on this appeal by the determinative question of whether the promise constituted “a special promise to answer the debt, default or miscarriage” of Joe Allsbrook under the section of the statute of frauds prescribing that “no action shall *790 be brought whereby ... to charge any defendant upon a special promise to answer the debt, default or miscarriage of another person, unless the agreement upon which such action shall be brought, or some memorandum Or note thereof, shall be in writing, and signed by the party charged therewith or some other person thereunto by him lawfully authorized.” G.S. 22-1. In our opinion, this question must be answered in the affirmative as a matter of law under the pleadings and the testimony. It is to be noted that the creation of the debt of Joe Allsbrook to plaintiff antedated the making of the promise of the defendant to plaintiff. Since there "was neither allegation nor proof of any agreement that the debt was extinguished by the promise, the liability of Joe Allsbrook to the plaintiff remained. Indeed, the language used by the defendant to plaintiff clearly manifested that the defendant had no intent to assume any independent duty of payment making the debt his own irrespective of the liability of Joe Allsbrook. His promise to the plaintiff was, in effect, that he would personally see that the check in controversy was paid in the event the assets of Joe Allsbrook proved insufficient to satisfy it. Thus, he simply superadded his promise to the antecedent obligation of Joe Allsbrook, rendering it collateral to the same. It is elementary that the plaintiff must recover, if he recovers at all, on the cause of action made out by his complaint. Barron v. Cain, 216 N. C. 282, 4 S. E. (2) 618; McCollum v. Chisholm, 146 N. C. 18, 59 S. E. 160; Simpson v. Simpson, 107 N. C. 552, 12 S. E. 447; Willis v. Branch, 94 N. C. 142; Melvin v. Robinson, 42 N. C. 80. The complaint contains no allegation to the effect that the promise of the defendant was made for his own benefit or that he had any personal, immediate, or pecuniary interest in the transaction. While it is alleged “that after the death of Joe Allsbrook, the defendant and two other persons bought the business of Joe Allsbrook known as City Auto Service, and the defendant and the two other persons are continuing the operation of said business,” it is nowhere suggested either in the pleadings or in the testimony that the defendant ever contemplated purchasing the business or any interest therein at any time during the life of Joe Allsbrook. The only consideration for the oral promise of the defendant alleged in the complaint and shown by the evidence was the agreement and act of the plaintiff extending time for the payment of the check of Joe Allsbrook for “about two weeks” and forbearing to take legal action against Joe Allsbrook or his property upon such check during that period. Undoubtedly, a forbearance to exercise legal rights is a sufficient consideration for a promise made on account of it in the general law of contracts. Chemical Co. v. McNair, 139 N. C. 326, 51 S. E. 949; Lowe v. Weatherley, 20 N. C. 353. This is true even when the forbearance *791 is in respect to the liability of a third person rather than that of the promisor. Bank v. Bridgets, 98 N. C. 67, 3 S. E. 826, 2 Am. S. R. 317. But the mere fact that there may be a new consideration for the oral promise of a defendant to pay the subsisting debt of another is not sufficient of itself to take the promise out of the prohibition of the statute of frauds. “To say that any consideration will take a promise based thereon out of the statute is to make the statute useless. For if there is no consideration the promise is invalid without the statute. The statute is aimed at what were valid contracts; that is to say, it makes invalid contracts not in writing which would otherwise have been valid.” Martin v. Harrington, 174 Mo. A. 707, 161 S. W. 275. See, also, in this connection, Stanly v. Hendricks, 35 N. C. 86. Here, the forbearance of the plaintiff was a benefit to the debtor, Joe Allsbrook, and a detriment to the plaintiff. Nevertheless, it was not beneficial to the defendant. This statement is applicable to this phase of the case : “A promise to a creditor to pay his debtor’s debt, the debtor not being discharged by the arrangement, in consideration of the creditor giving time to the debtor, or forbearing to sue him, or staying, or discontinuing a suit against him, or forbearing to levy an attachment or execution, on the debtor’s property, or suspending proceedings on an execution against the debtor, the lien of the execution remaining unimpaired, or forbearing to evict the debtor from premises leased by him, or to take out administration on the estate of the original debtor, is within the statute of frauds for the reason that such considerations are not regarded as directly beneficial to the promisor. The rule is different where the creditor’s forbearance results in a direct benefit to the promisor, which was the object of the promise, as where the promisor has an interest in the property which will be prejudiced by the bringing or continuing of the adverse proceedings. Mere forbearance without benefit to the promisor therefrom may be a sufficient consideration to uphold the promise as a contract, although it may be insufficient to take it out of the operation of the statute.” 27 C. J., Statute of Frauds, section 33. This passage is in complete accord with Peele v. Powell, 156 N. C. 553, 73 N. E. 234, and Gennett v. Lyerly, 207 N. C. 201, 176 S. E. 275, where the relevant rules are thus stated. “Where the promise is for the benefit of the promisor, and he has a personal, immediate, and pecuniary benefit in the transaction, or where the promise to pay the debt of another is all or part of the consideration for property conveyed to the promisor, or is a promise to make good notes transferred in payment of property, 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 prom-isor is not liable, unless there is a writing; and this is true whether made at the time the debt is created or not.” *792 We have not overlooked the contention of the plaintiff that this case is governed by the principle that the statute of frauds does not embrace an oral promise to pay the debt of another out of money or property which the debtor has placed in the hands of the promisor for the purpose of paying his debts. Dale v. Lumber Co., 152 N. C. 651, 68 S. E. 134, 28 L. R. A. (N. S.) 407; 49 Am. Jur., Statute of Frauds, section 87; 37 C. J. S., Statute of Frauds, section 18. The complaint does not present this theory. But even if it did, the plight of the plaintiff would not be improved. According to the testimony, Joe Allsbrook did not put the so-called “special account” or any other effects in the hands of the defendant for the specific purpose of paying his debts. He entrusted his funds and property to defendant to the end that defendant, acting as his agent, might carry on his business. The considerations stated require an affirmance of the compulsory judgment of nonsuit. It is so ordered. Judgment affirmed.