Richardson v. . Satterwhite

Brogden, J. On 20 August, 1925, the defendant, Satterwhite, went to the place of business of N. B. Finch and Company, mortgagee, for the purpose of examining the status of the account. The defendant narrated the transaction as follows: “Mr. Ruffin was my lawyer before he died. He went down there and went over these accounts. He came by my house and got me. He came somewhere close about ten o’clock. I don’t know what time, but ... I got back home that night. He came up here and checked up everything. When Mr. Ruffin checked up everything I got up here about eleven o’clock and Mr. Ruffin had me gone away from here about two hours by sun. He and I went down there that day, and when we were coming back he said: “Satterwhite, they have got you in debt.” . . . He said something was mighty wrong, and Mr. Finch told me himself that something was mighty wrong about my account. . . . When I got down there I went over the books with Mr. Roebuck. 1 can read figures, but I can’t read writing. . . . We were going over all the accounts. ... I didn’t get a dollar of money.” On the next day, to wit, 21 August, 1925, William H. Ruffin, now deceased, and an eminent lawyer, wrote a letter to N. B. Finch and Company. The letter begins as follows: Louisburg, North Carolina, 21 August, 1925. Messrs. N. B. Finch and Company, Spring Hope, N. C. Gentlemen: In re: C. C. Satterwhite note adjustment. Mr. Las-siter and I, with Cullen’s assistance, finished up our investigation of your books late yesterday evening, and checking over my work this morning I find that the only items now in question between us are cheeks made to your order as follows: 1913 :17 February, $5.00; 22 February, $5.00; 22 March, paid through Henry Satterwhite, $5.00; 6 September, $2.25; 9 September, $5.00. 1915: 29 May, $10.00; 12 June, $10.00. 1916: 29 May, $5.60. 1917: 13 January, $6.39. 1919: 21 April, $10.00; 28 April, $5.00; 19 April, $4.00; 16 May, $10.00; 8 July, $8.80; 26 September, $31.68; 2 December, $6.60. These checks total $130.32. He contends, as you know, that these were payments on account and not merely checks cashed for his accommodation. Possibly your cash account for these dates might throw some light on this question. . . . I could not always check up on your renewal notes, but from the best information I could get the last note, dated 5 March, 1924, for $4,011.73, is correct, and we raise no further question about the same. ... I am advising Cullen to make every effort to pay this down out of the 1925 crops to $3,000 or less, and if he will do this I believe I can rein *117 state bis land bank loan and get him the amount appraised which is, as I recollect, $3,776.51. If you will make this adjustment with him at once it will encourage him to make stronger efforts to pay you and get this matter settled. I found Mr. Lassiter a most agreeable gentleman, quite competent and very courteous and obliging in checking over this matter with me under adverse circumstances. Yery truly yours, ¥m. H. Ruffin.” Tbe plaintiff offered tbe foregoing letter in evidence, but tbe same was excluded by tbe trial judge. Consequently, tbe legal question arising is: Was tbe letter competent? Wigmore, Vol. 2 (Second Edition), section 1078, states the general rule applicable to the facts as follows: “He wbo sets another person to do an act in bis stead as agent is chargeable by such acts as are done under that authority, and so too, properly enough, is affected by admissions made by the agent in the course of exercising that authority. Tbis question, frequently enough a difficult one, depends upon the doctrine of agency applied to the circumstances of the ease, and not upon any rule of evidence.” To like effect is the declaration of tbis Court in Bank v. McEwen, 160 N. C., 414, 76 S. E., 222. “Where the relation of attorney and client exists the law of principal and agent is generally applicable, and a client is bound according to the ordinary rules of agency by the acts of bis attorney within the scope of bis authority.” See, also, West v. Grocery Co., 138 N. C., 165, 50 S. E., 565; Bank v. Miles Company, 177 N. C., 284, 98 S. E., 769; Bizzell v. Equipment Co., 182 N. C., 98, 108 S. E., 439, and Myers v. Kirk, 192 N. C., 700, 135 S. E., 788. Manifestly, if Satterwhite bad examined the books of account of N. B. Eincb and Company and bad written a letter of like tenor, it could not be doubted that such letter was admissible in evidence. Consequently, if Mr. Ruffin was employed by the defendant to adjust the account and in the process of adjustment be made an examination of the books and immediately wrote a letter setting forth additional credits that should be allowed to bis client, and undertaking to arrive at the amount wbicb bis investigation disclosed to be due, there is no sound reason or principle of law which would render the letter incompetent and inadmissible as evidence in the trial. Tbe defendant testified that Mr. Ruffin was employed to examine and check the account. Hence it is apparent from the testimony of the defendant that the letter was written witb the implied authority of defendant, at least, and certainly within the scope of the employment. No case has been cited from tbis State discussing tbe admissibility of letters written by attorneys within tbe scope of tbe employment. Tbe question, however, has been considered by courts in other jurisdictions, *118 and such letters have been generally beld to be admissible. The following cases are in point: McNamara v. Douglas, 61 Atl., 368; James v. Boston Electric Ry. Co., 87 N. E., 474; Burraston v. First Nat’l. Bank, 62 Pac., 425; Loomis v. N. Y., N. H. & H. Ry. Co., 34 N. E. 82; In re Rhinehardt’s Estate, 160 N. Y. S., 828. The principle is tersely stated in the headnote of the McNamara case, supra, as follows: “Where, in an action on a note given for plumbers’ services, defendant claimed that she had been induced to give the note by fraud and duress, and that the work and materials furnished were of no value, it was error for the court to exclude a letter written by defendant’s attorney in response to a bill for the work, in which the attorney requested an itemized bill of the materials used in the job, and stated that the defendant would pay the bill as soon as satisfied of its correctness; such letter being prima facie within the attorney’s authority.” The opinion of the Court says: “This letter was improperly excluded. It tended to show that up to the time of its date the defendant made no claim of fraud, or that the work and materials furnished were of no value. Had it been admitted, the defendant would have been at liberty to show, if she could, that her attorney, in writing it, went beyond his authority. Prima facie it was within it.” While the letter in the ease at bar, is admissible in evidence, it of course does not conclusively bind the defendant or give it the effect of a solemn admission in judicio. It would merely stand upon the same footing as the declaration of any other authorized agent. The plaintiff contends that the giving of the note and mortgage by the defendant and the lapse of time before there was any challenge of the correctness of the amount due, constitutes an account stated. This contention is not sustained. The case of Gooch v. Vaughan, 92 N. C., 610, is directly in point. The Court says: “The account rendered, and the long delay in objecting to it on account of suggested errors therein, do not necessarily conclude Gooch. The strong presumption is that he examined and accepted it as correct, and he is bound by it, and it ought not to be disturbed, unless he shall allege and prove some substantial error, mistake, omission, or fraud, vitiating it. This he has the right to do, if he can, and in case of success, to have the just correction made. The burden is on him to prove such allegation.” Davis v. Stephenson, 149 N. C., 113, 62 S. E., 900. Plaintiff contends that there was no evidence that the Citizens Bank of Spring Hope was not an innocent holder of the $3,500 note executed and delivered to it by the plaintiff. The plaintiff requested the court in apt time to instruct the jury to answer the second issue “Yes.” The evidence bearing upon the execution of the $3,500 note is substantially *119 as follows: N. E. Eineb, the mortgagee, was president of the bank and a member of the loan committee. He sold the land to bis son, E. D. Eineb. Tbe son, E. D. Eincb, conveyed the land to the plaintiff, wbo is. a nepbew of the mortgagee. Obviously, the fact that one member of a family conveys land to another or borrows money from another is no' evidence of fraud or bad faith, for there is no law which forbids kinsmen to deal with each other, and no court has ever held that such dealing in itself was a badge of fraud or bad faith. N. B. Eineh, mortgagee and president of the bank, as a member of the loan committee, approved the loan for $3,500, and testified that the money was “paid over to me” on the amount bis son, E. D. Finch, owed him. The trial judge instructed the jury that if N. B. Finch “negotiated this loan for bis own benefit, that is, if be negotiated this loan in the bank for bis own benefit, then such knowledge as be bad would not be imputed to the bank, but if for some other person, and not for bis own benefit, then, it would be imputed to the bank; that is if it was bis transaction and not for some other person, then the bank would not be charged with the knowledge in dealing for himself, but if be bad knowledge of these equities, and the transaction was for someone else, then this knowledge would be imputed to the bank.” This instruction is in accordance with accepted principles of law announced in Bank v. Wells, 187 N. C., 515, 122 S. E., 14; Bank v. Howard, 188 N. C., 543, 125 S. E., 123; Trust Co. v. Anagnos, 196 N. C., 327, 145 S. E., 924. New trial.