Parlier v. . Miller

ClakksoN, J. We think the court below erred in granting defendants’ motion to nonsuit. The promise made by E. B. Miller (defendants’ intestate) to J. E. Brown to pay W. W. Parlier the notes of $300 that Brown owed Par-lier under the facts in the case, if true, was a binding contract, founded on a valuable consideration and enforceable. J. F. Brown owed W. W. Parlier $300 and interest, balance of purchase-money of- land that was deeded to himself and wife by Parlier and wife. He gave. Parlier a mortgage on the land to secure the $300- — three bonds of $100 each. When J. F. Brown and his wife conveyed the land to E. B. Miller, if the evidence is true, Brown told him what was due on the land, and as part of the consideration, or purchase price of the land, Miller agreed to pay the $300 bonds and mortgage on the land that was owing to Parlier. From the evidence, E. B. Miller received a deed for the land and promised to pay the debt on it. “An assignee of a note secured by a mortgage is entitled to the full benefit of the mortgage; and where the mortgagor has conveyed the mortgaged land, subject to the payment of the mortgage debt, and it has successively been conveyed to several grantees, one to the other, each assuming in his deed the payment of said debt, a holder for value of the note thus secured, under the equitable doctrine of subrogation, has a right of action, not only against the mortgagor of the lands for whatever balance on the note the foreclosure fails to satisfy, but also against the several grantees of the land, who successively and from each other assumed the indebtedness secured by the mortgage, and evidenced by the note sued on.” Baber v. Hanie, 163 N. C., 588. The assumption of the debt need not be in writing. The matter is fully discussed and the principle above set forth sustained by Walker, J., in Sector v. Lyda, 180 N. C., 577. The same learned Judge wrote the Baber case, supra. See Woodcock v. Bostic, 118 N. C., 822; Way v. Transportation and Storage Co., ante, 224. We deduce from the authorities that it is well settled that where a contract between two parties is made for the benefit of a third, the latter may sue thereon and recover, although not strictly a privy to the contract. It is well settled that a direct action will lie against the promissor when the promise to pay the debt of another arises out of some new and original consideration of benefit or harm, moving between the principal contracting parties. *504 The defendants filed no brief and did not argue the case in this Court. In the answer the learned counsel- for the defendants, among other defenses, relied on the statute of frauds and the three-year statute of limitations. The statute of frauds, which-is as follows, does not apply to the facts in this case: “No action shall be brought whereby to charge an executor, administrator or collector upon a special promise to answer damages out of his own estate or 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.” C. S., sec. 987, well known as 29 Charles II. The three-year statute of limitations does not apply. The promise was to pay the bonds, which were under seal, and ten years had not expired when this action was commenced. C. S., 437, says: “Within ten years an action . . . upon a sealed instrument against the principal thereto.” Professor Minor, in his great treatise on Real Property, says: “If the assignee (of the land) does thus assume payment of the mortgage debt, he thereby becomes the principal debtor, and the original mortgagor is only liable subsidiarily as a surety. And while the mortgagee may continue to hold the mortgagor personally liable upon his contract to pay the debt, notwithstanding the assumption of the mortgage by the purchaser of the land, he may also, it seems, hold the purchaser directly responsible, though he is not a party to the agreement between the mortgagor and the purchaser — a right based sometimes upon the principle that one may sue upon a contract to which he is not a party, if it be made for his benefit, and sometimes upon the theory of the subrogation of the mortgagee to the rights of the mortgagor (the surety) against the purchaser (the principal debtor).” 1 Minor on Real Property, sec. 647. Baber v. Hanie, supra. These are the only defenses that can now be considered in the record on the motion of the judgment for nonsuit, which is always to be taken in a light most favorable to plaintiff. Upon a new trial there may be other defenses. For the reason stated, there was error. Reversed.