Murchison National Bank v. Broadhurst

*369 Clarkson, J. The question involved: Where plaintiff in a creditor’s bill, in an action instituted in Johnston County, demanded judgment upon a $100,000 note and subsequently instituted an action in New Hanover County on the same note, should the second action be abated as to those who are defendants in both actions? We think so. Plaintiff, a creditor, joined in a creditor’s bill to set aside certain conveyances made by F. K. Broadhurst, by way of mortgage on lands in Johnston County on the ground that they were fraudulent and void as to creditors. The action must be tried in that county, subject to the power of the court to change the place of trial in certain cases. C. S., 463(1); Wofford v. Hampton, 173 N. C., 686; Lumber Co. v. Lumber Co., 180 N. C., 12; and if brought in New Hanover County, it would have been subject to change of venue. C. S., 470; Causey v. Morris, 195 N. C., 532. In the first action in Johnston County it will be noted that the Murchison National Bank, in the creditor’s bill; sets forth the note of $100,000, and the hypothecated bonds of the Smithfield Mills, Inc., which it says it stands ready to sell and apply the net proceeds on the indebtedness. The prayer for judgment in that action is for the debt. The answer sets up certain defenses: (1) F. K. Broadhurst was an accommodation endorser along with other endorsers; (2) pleads an offset of $28,000 usurious interest and penálty, and prays that the other endorsers be made parties, and the indebtedness be credited with $28,000, and also credited with any amount received from the bankruptcy estate of W. H. Austin, the Murchison National Bank having filed this claim against the bankruptcy estate. All these matters, so far as the appealing defendants are concerned, can be tried out in the Johnston County action, under our liberal practice, as well as setting aside the conveyances for fraud. Chemical Co. v. Floyd, 158 N. C., 455; Robinson v. Williams, 189 N. C., 256; Carswell v. Talley, 192 N. C., 37. This action in Johnston County was pending when the action in New Hanover County was instituted. Full and adequate relief against the appealing defendants is obtainable in the Johnston County action. "Tests of Identity in General. Four leading tests have judicial sanction in determining whether or not the causes of action are the same for the purpose of abatement by reason of the pendency of a prior action: (1) 'Clearly, in order to hold the subsequent suit to be necessary, it is an essential prerequisite that the judgment in the former or prior action should be conclusive between the parties and operate as a bar to the second.’ (Williams v. Gaston, 148 Ala., 214, 216, 42 S., 552.) In other words, if a final judgment in the former suit would support a plea of res adjudicaba in the subsequent suit, the suits are identical for this purpose; otherwise they are not. (2) Many cases apply the following *370 test: Was full and adequate relief obtainable in the prior action? If so, the second action was improperly brought and is abatable; if not, the objection will be overruled. This, as we shall see, is a generally recognized rule. (3) A test having the support of some of the eases is this: Will the same evidence support both actions? (4) A fourth test supported by English and Canadian authorities is: Could the bill in the second suit have been procured by a fair amendment of the first?” 1 C. J., p. 66, par. 83. Under the pleadings in the Johnston County action, by the submission of the issues arising on the pleadings, plaintiff could obtain full and adequate relief against the appealing defendants. Tbe prayer in both actions, in the Superior Court of New Hanover County and Johnston County, is for judgment on the $100,000 note and interest, and in both pleadings the hypothecated collateral is set forth. In either case this collateral could be sold and applied on any judgment obtained. Plaintiff elected with others to file a creditors’ bill in Johnston County Superior Court to set aside certain conveyances, alleged to have been made in fraud of creditors, and prays for judgment on its debt. Plaintiff did this voluntarily — it chose the forum, the jurisdiction. To be sure, such an action must be tried in the county where the land was situate, but it bad the election to go in or not go in the particular action. It chose to go in Johnston County Superior Court. Multiplicity of actions against the same parties are not encouraged. Emry v. Chappell, 148 N. C., 327; Construction Co. v. Ice Co., 190 N. C., 580; Chappell v. National Hardwood Co., 234 Mich., 296, 44 A. L. R., 804; Van Vleck v. Anderson, 136 Iowa, 366; Haas v. Righeimer, 220 Ill., 193. “In Alexander v. Norwood, 118 N. C., 382, the court said: ‘The purpose of the Code system is to avoid a multiplicity of actions by requiring litigating parties to try and dispose of all questions between them on the same subject-matter in one action. Where an action is instituted and it appears to the court by plea, answer, or demurrer that there is another action pending between the same parties, and substantially on the same subject-matter, and that all the material questions and rights can be determined therein, such action will be dismissed.’ In that case the Court said that ‘the plaintiff (in the second action) has no election to litigate in the one or bring another action, but must set up bis defense in the first action, Rogers v. Holt, 62 N. C., 108, and the Court will ex mero motu dismiss the second action as the parties, even by consent, cannot give the court jurisdiction.’ Long v. Jarratt, 94 N. C., 443.” Allen v. Salley, 179 N. C., at pp. 150-1; Distributing Co. Carraway, 196 N. C., 58. “A demurrer would lie if the pendency of the former *371 action appeared on the face of the complaint.” Allen v. Salley, supra, at p. 148; Lineberger v. Gastonia, 196 N. C., at p. 449. Grounds not appearing on the face of complaint, the objection may be taken by answer. C. S., 517. For the reasons given, the judgment below is Reversed. Adams, J., dissents.