Tesh v. . Rominger

WiNBORNE, J. Upon the facts presented in the record, we hold that there is error in allowing motion for judgment as in case of nonsuit. There is a recognized rule of law, reflected in the decisions of this Court, that a provision in a note that the collateral therewith deposited may be held by the payee to secure other indebtedness of the maker to the payee, due or to become due, is valid. Norfleet v. Ins. Co., 160 N. C., 327, 75 S. E., 937; Milling Co. v. Stevenson, 161 N. C., 510, 77 S. E., 676. See, also, annotations, 87 A. L. R., 615. Where it is admitted, or where there is evidence tending to show, that property is owned by another, one who claims that it is subject to a pledge in his favor has the burden of establishing that fact. 49 C. J., 908, Pledges, sec. 31; Brimmer v. Brimmer, 174 N. C., 435, 93 S. E., 984. *56 Upon application of these principles to the case in band, there being evidence tending to show that the plaintiff is the owner of the pledged stock subject to the pledge of it as security for the $200 note, if defendant claim that the stock be held by him as collateral security to “other obligation,” as described in the collateral note, the burden of proof with respect thereto is upon the defendant. In the present state of the case, while it appears from plaintiff's evidence that on 17 March, 1936, along with the $200 note of plaintiff and collateral security therefor, Rominger Furniture Company stock, the First National Bank of Winston-Salem also held and assigned to defendant two other notes of which the plaintiff was sole or co-maker, taking the evidence in the light most favorable to plaintiff and giving to him the benefit of every reasonable intendment and reasonable inference to be drawn therefrom, as we must do on motion for nonsuit, C. S., 567, it does not appear that the other notes were in existence and remained unpaid at the date of the institution of the action or at the time of the trial. The burden is upon the defendant to prove the status at that time, that the other notes had not been paid and the amount due thereon. 49 C. J., 1030 — Pledges, sec. 316. There being evidence that after the bank assigned the notes to the defendant, plaintiff tendered to defendant payment of the $200 note and demanded surrender of the stock collateral thereto, it may reasonably be inferred that that note was the only obligation for which the stock was security. But if, after taking the plaintiff’s evidence in such light and giving to him such benefit, it be conceded that the evidence is sufficient to establish the fact that “other obligation” by reason of the other notes or either of them remains unpaid, and that defendant is entitled to hold the 25 shares of Rominger Furniture Company stock as security to such “other obligation,” we are of opinion that the action should not have been dismissed as in judgment as of nonsuit. Defendant pleads ownership of the stock and denies right of plaintiff to redeem. Tender, therefore, is unnecessary and is deemed to be waived. 49 C. J., 973—Pledges, sec. 185; Gaylord v. McCoy, 161 N. C., 685, 77 S. E., 959; Owens v. Ins. Co., 173 N. C., 373, 92 S. E., 168; Samonds v. Cloninger, 189 N. C., 610, 127 S. E., 706. In Ball-Thrash v. McCormick, 162 N. C., 471, 78 S. E., 303, it is said: “If we consider the pledgee as the legal owner of the collateral, he holds it in trust, first, for himself, and then for the pledgor. If the debt for which the property is pledged be less than the value of the latter, the pledgor has not only a technical interest as a beneficiary, but a substantial one, and he is also a beneficiary in the sense that he will be entitled to the thing pledged upon payment of his debt. When he sues to protect *57 and preserve bis interest in tbe pledge, tbe court may so proceed or so mould its judgment or decree as to protect all parties concerned. Our present system of pleading and practice is elastic enough for tbis purpose.” Tbe judgment below is Reversed.