State-Planters Bank v. Randolph

CoNnok, J. At the trial of this action in the general county court it was agreed that the first issue should be answered in the affirmative. The issue was accordingly answered, “Yes.” "With respect to the second issue, the court instructed the jury as follows: “The burden of this issue is on the plaintiff. It contends that the amount which the plaintiff is entitled to recover in this action is $2,490.52, with interest from 12 January, 1932, until paid. “If you find the facts to be as testified to by the witnesses, and as shown by all the evidence in the case, you will answer the second issue, $2,490.52, with interest from 12 January, 1932, until paid.” Under this instruction the jury answered the second issue as appears in the record. The defendant Wachovia Bank and Trust Company, executor of Dr. H. H. Briggs, deceased, excepted to this instruction, and on its appeal to the Superior Court assigned same as error. The assignment of error was not sustained. In this there was no error. Whatever conflict there may appear to be in the decisions of this Court with respect to the liability of the grantee of land who has assumed the payment of an indebtedness of his grantor which was secured by a prior mortgage or deed of trust executed by the grantor, as said in Bank v. Page, 206 N. C., 18, 173 S. E., 312, “the law undoubtedly is, that when a purchaser of mortgaged lands, by a valid and sufficient contract of assumption, agrees with the mortgagor, who is personally liable therefor, to assume and pay off the mortgage debt, such agreement inures to the benefit of the holder of the mortgage, and upon its acceptance by him, or reliance thereon by the mortgagee, thenceforth as between themselves, the grantee occupies the position of principal debtor and the mortgagor that of surety, and the liability thus arising from said assumption agreement may be enforced by suit in equity under the doctrine of subrogation, Baber v. Hanie, 163 N. C., 588, 80 S. E., 57, or by an action at law, as upon a contract for the benefit of a third person. Rector v. Lyda, 180 N. C., 577, 105 S. E., 170.” *244 It follows from this statement of the law that the release by the holder of the notes of the makers from all personal liability did not affect the liability of the defendants, who had expressly assumed the ■payment of the notes, and had thereby, as between themselves and the makers, become liable as principals. The rule that a release by a creditor of his debtor, who is liable as a principal for the debt, discharges a surety manifestly has no application in the instant case. There was no error in the refusal of the judge of the Superior Court to sustain defendant’s assignment of error in its appeal from the judgment of the general county court. The judgment of the Superior Court is Affirmed.