Denton v. Shenandoah Milling Co.

BeogdeN, J. Was there sufficient evidence to be submitted to the jury as to whether the intervening bank was a purchaser and owner of the drafts in controversy? The general rule recognized and adopted by the majority of the American courts, and which prevails in this jurisdiction is “that if a bank discounts a paper and places the amount less the discount to the credit of the endorser with the right to check on it and reserves the right to charge back the amount if the paper is not paid, by express agreement or one implied from the course of dealing, and not by reason of liability on the endorsement, the bank is an agent for collection and not a purchaser.” By inverting the proposition, it is clear that in cases of this type, a purchaser of the draft is one who acquires the unconditional title thereto, with no agreement, express or implied, to charge the paper back if it is not paid. This Court and others generally have declared that an implied agreement to charge back may be inferred from a relevant course of dealing between the parties. Consequently, the first inquiry is whether the intervener purchased the instrument. *81 The cashier of the intervening bank testified that his bank purchased the draft and owned it at the time the suit was instituted. This testimony was excluded, apparently upon the theory that the purchase and ownership of the draft were the identical questions to be determined by the jury. Such ruling upon the facts disclosed, was correct. Marshall v. Telephone Co., 181 N. C., 292, 106 S. E., 818; Temple v. LaBerge, 184 N. C., 252, 114 S. E., 166; Trust Co. v. Store Co., 193 N. C., 122, 136 S. E., 289. Furthermore, the facts relating to the acquisition of the paper are not in dispute. Hence the excluded testimony was no more than the conclusion of the witness. Temple v. LaBerge, supra. The line of judicial thought in this State, determining whether a bank is a purchaser or collecting agent, is composed of two branches. One branch is made up of those cases in which the evidence is conflicting, equivocal and contradictory. In such event an appropriate issue must be submitted to a jury. See Worth v. Feed Co., 172 N. C., 335, 90 S. E., 295; Sterling Mills v. Milling Co., 184 N. C., 461, 114 S. E., 756; Bank v. Monroe, 188 N. C., 446, 124 S. E., 741. The other branch is composed of cases in which the evidence in its entirety seems susceptible of only one construction, interpretation or conclusion. In such event the question as to whether the bank is a purchaser becomes one of law and governed by the instruction of the trial judge. Temple v. LaBerge, 184 N. C., 252. Therefore, the solution of the case at bar depends upon whether the evidence liberally interpreted classifies the action as belonging to the line represented by Temple v. LaBerge, supra, or the line represented by Banlc v. Monroe, supra. Hence, it is necessary to examine the evidence. At the outset, it is to be noted that the intervening bank was the payee specified in both instruments, and each of said drafts contained upon its face the notation that it was “not to be treated as a deposit. The funds obtained through its collection are to be accounted for to the drawer,” etc. The drawer was the Shenandoah Milling Company. The cashier of the bank testified expressly that if the drafts were refused and unpaid that they would be charged back to the account of the Shenandoah Milling Company, the bill of lading and the draft being returned to said company. The treasurer of the Milling Company said that “in case the draft comes back uncollected in regard to our account, as a rule, we ask the bank to get the draft and bill of lading back. The amount of this draft is customarily either charged back to our account or we give them a check for it.” The court is of the opinion that the undisputed evidence classifies the case within the principle announced in Temple v. LaBerge, supra, and hence the ruling of the trial judge was correct. Affirmed.