liberty to change at its will the contract of in- | plaintiff in this case was suspended by the desurance it has made with each insurer. The fendant during the time that the defendant company and the insured occupy two entirely was in default in complying with the statdifferent relations. In one it is a company and the other party one of its members. In that utory regulations in regard to filing such relation, the by-laws or constitution can be amendments. (3) The plaintiff in the Wilamended at will of the majority, if done in the liams Case tendered no payment under prolegal and prescribed mode. The other relation is that of insurer and insured, and this contract test, or otherwise, after the proposed classifirelation cannot be altered save by the consent cation, while the plaintiff in this action tendof both parties, and the party alleging that the ered his January, 1916, dues under the terms consent was given must show it." "A mere general consent that the constitu- and conditions specified in the written tender that it should be accepted "in accordance tion and by-laws may be amended applies only to such reasonable regulations as may be within with the rate fixed by the by-laws prior to the scope of its original design." Strauss v. October 28, 1915,” and the payment was acLife Ass'n, 128 N. C. 465, 39 S. E. 55, 54 L. R. cepted, which was an acknowledgement that A. 605, 83 Am. St. Rep. 699. We are of opinion that the statute of Maryland did not authorize the classification adopted, and that if it had, it would be invalid because in violation of the contract rights of the plaintiff. the classification was null and void as against this plaintiff, or at least a waiver of said classification as to him. The defendant in raising the rate in 1901, in which the plaintiff acquiesced, furnished the plaintiff in July, 1901, a written state [3-5] We further think that this was a Northment as follows: Carolina contract, and is governed by the statutes of this state (Knights of Pythias v. Meyer, 198 U. S. 508, 25 Sup. Ct. 754, 49 L. Ed. 1146; Equitable Soc. v. Pettus, 140 U. S. 226, 11 Sup. Ct. 822, 35 L. Ed. 497; Insurance Co. v. McCue, 223 U. S. 234, 32 Sup. Ct. 220, 56 L. Ed. 419, 38 L. R. A. [N. S.] 57), and there is no statute of this state which au thorized this radical change of the statute of the plaintiff. It has been often held that insurance is not interstate commerce (Insurance Co. v. Craven, 178 U. S. 389, 20 Sup. Ct. 962, 44 L. Ed. 1116), and the presumption is that the law of the place at which a contract is made shall govern the rights of the parties (Insurance Co. v. Cohen, 179 U. S. 262, 21 Sup. Ct. 106, 45 L. Ed. 181). The plaintiff's contract of insurance was written in 1896, and the passage of chapter 54, Laws 1899, could not change the tenor of the contract made with the plaintiff prior to its passage. Nor could it authorize the application to it of a Maryland statute. His contract is to be construed entirely in the light of the statutes in force in this state in 1896. The condition that the society is to be governed by the bylaws enacted by the Supreme Conclave from time to time has reference to the future regulations of the order which are reasonable in their terms and which do not impair vested rights. Strauss v. Life Ass'n, 126 N. C. 971, 36 S. E. 352, 54 L. R. A. 605, 83 Am. St. Rep. 699; Id., 128 N. C. 465, 39 S. E. 55, 54 L. R. A. 605, 83 Am. St. Rep. 699. [6] This court has already held that this particular classification by this defendant is unlawful and invalid. Williams v. Heptasophs, 172 N. C. 987, 90 S. E. 888. This case is stronger for the plaintiff than that, because: (1) In the Williams Case the record did not show, as in this, that the defendant was in default in filing certified copies of its proposed amendments to its constitution and by-laws with the insurance commissioner of "It makes no difference how long you have been a member; you need pay only the rate for the age you were when joining the order. You now have an order second to none, based upon sound business principles, appealing to all seeking good, safe protection at a minimum will cost them each month, and thus benefit You can now tell your friends what it them, and aid the order." cost. The defendant had the right to increase its rates, if necessary, laying them as they did at the increase in 1901 and again in 1910, upon all the members upon the basis of the age at which they became members, but it had no right to practically divide the membership into two, putting the plaintiff in class B, into which no new members would be admitted from time to time. It is true there is an opportunity for the members of class B to pass into class A, but upon the condition that they shall be assessed at the attained age (which of plaintiff is now 75 years), for this is indirect violation of the terms upon which he entered the association. As insurance company is like a river. The loss in volume by the outflow is more than made up by accessions along the route, i. e., by the interest accruing, and by the waters coming from above, i. e., the payments by new members. While time depletes the current by death, it is adding to it from new sources. But when, as in this case, the company seeks to divide its members into classes, the older of which will receive no accessions, the current will soon run dry. It is true that this figure is more applicable to the standard companies than to a benefit association, where the losses are paid by assessments upon death. But it is none the less true that when there is a class in which there are no new members to assess, that class must become smaller and smaller, and the assessments larger and larger, till they become unbearable. Certainly such division into classes is not within the contract made by this plaintiff, and upon breach of that con cipal money which he has paid in with simple ness by the fraud of the defendants. The interest thereon. defendants denied the allegations of fraud. It appears that the plaintiff has paid in The plaintiff introduced evidence tending to principal money in the 20 years from 1896 establish his contentions, and that he had to 1916 $3,149.31. He is now over 75 years of been damaged at least in the sum of $1,200, age, and unable to obtain other insurance. the amount paid by him to the defendants. The classification attempted to be enforced The defendants introduced evidence tending upon him is unlawful, arbitrary, and discrim- to prove there was no fraud, that the ininatory, as we have already held in Williams | terest purchased by the plaintiff was worth v. This Defendant, 172 N. C. 787, 90 S. E. 888. $1,200 at the time of the sale, and that the We hold that the contract under which the plaintiff claims is founded upon and governed solely by the laws of North Carolina, and that even if it were governed by the laws of Maryland the classification complained of is not warranted by the laws of that state, and if it were they could not impair the obligation of the contract which the defendant entered into with this plaintiff, and the judgment is in all respects affirmed. No error. ALLEN, J., not sitting. (174 N. C. 658) HOKE v. WHISNANT & TILLEY. (No. 474.) loss to the plaintiff was due to mismanagement occurring after the sale. The negotiations with the plaintiff began in November, 1910, and resulted in the purchase by him of the interest in the business in February. 1911. This action was commenced in 1914. Under instructions to which there is no exception the jury returned the following verdict: (1) Was the plaintiff induced to purchase a one-third undivided interest in the stock of goods and business of the Whisnant-Tilley Company by the false and fraudulent representations of the defendants, as alleged in the complaint? Answer: Yes. (2) What damages, if any, is the plaintiff entitled to recover? Answer: $400. Upon the coming in of the verdict the (Supreme Court of North Carolina. Dec. 5, plaintiff moved the court: 1917.) 1. APPEAL AND ERROR 979(5)-DISCRETION OF COURT-REVIEW. Discretion of court in denying plaintiff's motion to set aside verdict for him as inadequate, and for new trial, is not reviewable. 2. JUDGMENT 199(1) - JUDGMENT ON VERDICT-AMOUNT OF DAMAGE. In an action for damages for fraud, where the jury found that plaintiff was induced by fraud to purchase a third of defendants' business to his damage $400, but there was no finding, nor any admission in the pleadings or on trial, that plaintiff had been damaged $1,200, plaintiff's motion for judgment on the verdict for $1,200, was properly denied. 3. FRAUD 59(2)-PURCHASE OF BUSINESSMEASURE OF DAMAGES. In an action for damages from fraud inducing plaintiff to purchase a share in a business, the measure of damages, where the property is retained by plaintiff, is the difference between its real value and its value as represented to be, not the amount paid for it by plaintiff. (1) To set aside the verdict as to the second issue, and for a new trial as to the Isaid issue, because the damages assessed are inadequate and not in conformity to the pleadings and proofs. Motion denied, and plaintiff excepted. (2) To set aside the verdict as to the second issue, and render judgment for the sum of $1,200 and interest from the 4th day of February, 1911, based upon the pleadings, proofs, and the findings of the jury upon the first issue, and tenders judgment accordingly. This motion was denied, and plaintiff excepted. Judgment was then rendered in favor of the plaintiff for $400, with interest thereon from February 4, 1911, the date of the contract of sale. The defendant excepted to the judgment upon the ground that the plaintiff was not entitled to recover interest except from the date of the judgment. Both Damages recovered for fraud inducing plain-parties appealed. tiff to purchase a share in defendants' business 4. INTEREST 21-DAMAGES FOR TORT. do not, as a matter of law, bear interest until Councill & Yount, of Hickory, for plainafter judgment. 5. APPEAL AND ERROR 750(8)-ASSIGNMENT of Lenoir, for defendants. tiff. Mark Squires and M. N. Harshaw, both OF ERROR-APPEAL FROM JUDGMENT. Where defendants appealed from the judgment, it was not necessary for them to assign error therein in the allowance of interest on tort damages before judgment. Appeal from Superior Court, Caldwell County; Carter, Judge. Action by W. W. Hoke against Whisnant & Tilley. From a judgment for plaintiff, both parties appeal. Affirmed on plaintiff's appeal, and reversed on defendants'. [2, 3] Nor can the motion for judgment for $1,200 be allowed, because there is neiThis is an action to recover damages, the ther finding by the jury nor admission in the plaintiff alleging that he was induced to pay pleadings or on the trial that the plaintiff $1,200 for an interest in a mercantile busi-has been damaged $1,200. On the contrary, HOKE, J., not sitting. (174 N. C. 671) while the defendants did not deny that the The judgment must be reformed by strikplaintiff paid $1,200, they contended, and ing out the interest, except from the term introduced evidence in support of their con- at which the action was tried. tention, that the interest in the business Plaintiff's appeal affirmed. bought by the plaintiff was worth $1,200 at Defendant's appeal reversed. the time of the sale, and that the loss sustained by the plaintiff was due to subsequent mismanagement. The measure of damages in actions of this character, where the property is retained by the vendee, as here, is the difference between the real value of the property and its value as represented to be, and not the amount paid by the vendee. Lunn v. Shermer, 93 N. C. 165; Robertson v. Halton, 156 N. C. 218, 72 S. E. 316, 37 L. R. A. (N. S.) 298. The plaintiff was not entitled to judgment for $1,200, and it would have been error to instruct the jury to answer the second issue in that amount, if requested to do so. [4] The exception of the defendant to the judgment must be sustained as the action is in tort to recover damages, and not in contract. The principle is stated in Harper v. Railroad, 161 N. C. 451, 77 S. E. 415, as follows: "Damages recovered for a tort do not, as a matter of law, bear interest until after judgment, but when the tort consists solely in the destruction of property, and not in personal injuries, this court has held that the jury may, in their discretion, give interest on the value of the property destroyed from the date of its destruction, in addition to the actual value of the property. Rippey v. Miller, 46 N. C. 480 [62 Am. Dec. 177]; Guano Co. v. Magee, 86 N. C. 351; Williams v. Lumber Co., 118 N. C. 928 [24 S. E. 800]: Lane v. Butler, 135 N. C. 419 [47 S. E. 4881: Stephenson v. Koonce, 103 N. C. 266 [9 S. E. 315]; Wilson v. Troy [135 N. Y. 96, 32 N. E. 44], 18 L. R. A. 449 [31 Am. St. Rep. 817] and notes." The distinction between the recovery of interest as damages in actions of tort and in actions ex contractu is pointed out and discussed in Bond v. Cotton Mills, 166 N. C. 20, 81 S. E. 936. [5] It was not necessary for the defendant to assign error, as his appeal is from the judgment. Clark, C. J., says in Ullery v. Guthrie, 148 N. C. 418, 62 S. E. 552: "It has always been held that an appeal is itself a sufficient exception and assignment of error to the judgment, for that is a matter appearing upon the face of the record proper, and as to errors on the face of the record no exception is required. Revisal, 1542. This is fully discussed in Thornton v. Brady, 100 N. C. 38 [5 S. E. 910], which has been repeatedly cited since. But if an exception and assignment of error to the judgment were necessary, the appeal itself is a sharp assignment that the facts found or admitted do not justify the judgment. Appomattox Company v. Buffalo, 121 N. C. 37 [27 S. E. 999]; Murray v. Southerland, 125 N. C. 176 [34 S. É. 2701; Delozier v. Bird, 123 N. C. 692 [31 S. E. 834]; Cummings v. Hoffman, 113 N. C. 269 [18 S. E. 170]. Of course, if the appeal is an exception to the judgment, it is on the ground that the facts found or admitted do not justify the judgment. And when there are no other exceptions in the case, this one exception cannot be grouped." CHATHAM et al. v. MECKLENBURG REAL- (Supreme Court of North Carolina. Dec. 5, If, in a subscription paper, signed by a country club and a realty company, the words ". Country Club" were stricken out by one of the signers with the knowledge and consent of the other parties before delivery to plaintiff, the paper, signed by the president and two directors of the realty company, was the sole obligation of such company. 2. CORPORATIONS 426(10) CONTRACT BY PRESIDENT AND DIRECTORS-BINDING Force. Where a realty company, by its president and two directors duly authorized and acting for the company, signed a subscription of $10,000 to aid in the construction of a street railway through its property, and a subsequent change in the contract was ratified by the company, whose officers saw the work in progress under an amended agreement and made no objection, the company, which was benefited many times the value of its subscription by reason of the work. done, was bound thereby, though the contract was not authorized by the majority of stockholders in meeting. 3. INTEREST 15-INTEREST ON MONEY DUE BY CONTRACT VERDICT AND JUDGMENT STATUTE. Under Revisal 1905, § 1954, providing that all sums due by contract, except on penal bonds, shall bear interest, that when a jury shall render a verdict therefor they shall distinguish the principal from the sum allowed as interest, and that the principal sum due on all such contracts shall ment until paid and satisfied, in an action on a bear interest from the time of rendering judg realty company's subscription contract, the jury having found for plaintiff in the principal sum, the court should have entered judgment, bearing interest thereon from the date of the contract or from the time at which it was due under the contract. 4. INTEREST 21-ACTION IN TORT-INTEREST ON VERDICT AND JUDGMENT. interest or not as it sees fit, and when it does not When an action is in tort, the jury can allow assess interest, the verdict and judgment bear interest only from the first day of the term at which the judgment is rendered. Appeal from Superior Court, Mecklenburg County; Cline, Judge. Action by Paul Chatham and others against the Mecklenburg Realty Company. From judgment for defendant, both parties appeal. Judgment modified on plaintiffs' appeal; no error found on defendant's ap peal. In May, 1910, the defendant owned 1568/10 acres of land about 31⁄2 miles east of Charlotte, which it had bought for $16,131, and proposed to dispose of the same for surbur directors, it would be worth $10,000 to the defendant to have the road run through his property. In May, 1913, when the plaintiffs again demanded payment of its subscription, the defendant's officers replied, in effect, that they had then disposed of practically all their property, and had no interest in the car line, and again refused payment. Upon the issues submitted the jury found a verdict for plaintiff in the sum of $10,000, but the court signed judgment with interest on $10,000 only from first day of the trial term. Both parties appealed. Cansler & Cansler and H. L. Taylor, all of Charlotte, for plaintiffs. Osborne, Cocke & Robinson, of Charlotte, for defendant. Defendant's Appeal. CLARK, C. J. [1] The court properly instructed the jury that, if the words "Mecklenburg Country Club" were stricken out by one of the signers of the paper with the knowledge and consent of the other parties before the delivery to the plaintiff that the paper delivered, signed by the president and two directors of the defendant company, was the sole and exclusive obligation of the defendant, it was a complete contract in itself, and not a preliminary agreement, and was a valid obligation between the parties. There was evidence that upon the failure of the ban home lots. W. S. Lee was president of defendant, and A. J. Draper and W. H. Wood were directors, and these with other associates organized the Mecklenburg Country Club adjoining the defendant's land. In June, 1910, Paul Chatham had an application before the aldermen of Charlotte for a street railroad franchise; the nearest street car line at that time being 11⁄2 miles from this property. Defendant was desirous that Chatham should construct the line he proposed through defendant's property, and the president of the defendant proposed that it and the Country Club would subscribe $10,000 to aid in the construction of the line to be run through a part of the defendant's property. This paper was dictated by Lee to a stenographer, and was signed by him in the name of the company and delivered to Chatham to get Draper and Wood, the two directors above mentioned, to sign, which was done by them with Lee's concurrence after striking out the Mecklenburg Country Club as one of the parties. In December, 1910, Stephens, selling agent of the defendant, had a plat made of the property which has been sold off for $87,185, being an advance of $71,053 profit. Work was begun on the street railway in the spring of 1911, and completed in November of that year. The defendant sold practically all this land between March 20 and May 30, 1911. It was in evidence that the plaintiffs' and defend-storage battery cars the defendant extended ant's officers were in consultation many times during the construction of the line, and that no objection was made by defendant to the location of the line after the completion of the first line, when the plaintiff presented a bill to the defendant for its subscription of $10,000, that objection was made that the storage battery cars with which the line was equipped were unsatisfactory, and that thereupon the plaintiff proposed that he would take the line up and build a firstclass trolley system down Mecklenburg avenue to the Country Club as soon as he could get a contract with the Southern Public Utilities Company to furnish the power to | operate it; and it was replied by the defendant's officers that in such case the defendant would have to pay the $10,000. There was also evidence that the plaintiffs began the construction of a trolley line, which was laid out by Laxton, one of defendant's directors, and that while this line was under construction defendant's officers frequently saw the work in progress, and none of them protested that the line was unsatisfactory, and, further, that this second line was located and completed with the knowledge and consent and approval of defendant's officers, at a cost of $35,000, and has since been in continuous operation at a cost of about $30 per day, and that defendant's president stated that when he signed the paper he was satisfied that if the road was built in a con and afforded an opportunity to the plaintiffs to perform the contract without an abandonment of the subscription, and that the construction of the second line was under and in reliance upon the subscription; that the terms of the contract were complied with, and were ratified by the defendant, and that the defendant never dissented from or protested against the construction of the second line. [2] The defendant earnestly insists that it is not bound by the contract signed by its president and two directors, and insists upon the decision in Duke v. Markham, 105 N. C. 131, 10 S. E. 1017, 18 Am. St. Rep. 889, which held that a mortgage was not valid, as to third parties, which was not authorized by the majority of the stockholders in meeting assembled, the assent of each stockholder having been given separately and at different times to a person who went around to them privately, holding that this was not the act of the corporation, and that, though money was raised upon such mortgage, this would not validate it as to other creditors, since it was invalid when registered. That has no application in this case. This contract as submitted to the jury is between the original parties thereto, and was executed by the president and two directors. There was evidence that they were acting in behalf of the corporation as their general agents, with the knowledge of the company, and that sub assess interest, the verdict and judgment bear interest only from the first day of the term at which the judgment is rendered. Harper v. Railroad, 161 N. C. 451, 77 S. E. 415; Hoke v. Whisnant, 94 S. E. 446, at this term. The judgment will be modified so as to bear interest from May 19, 1913. there were changes made in the work to | fit; and therefore, when the jury does not the knowledge of the defendant company; that its officers saw the work in progress and under the amended agreement, and made no objection. There was ample evidence, if believed by the jury, that the president and the two directors in making the contract were acting within the scope of their authority, and that the subsequent change in the contract was ratified by the defendant, who has been benefited many times the value of the subscription by reason of the work done by virtue of this contract; and the jury, under very full and correct instructions by the court, have found their verdict in favor of the plaintiffs. The exceptions are numerous, and were ably and fully presented in this court. We have carefully considered 1. APPEARANCE 9(1) GENERAL APPEARthem, and do not find error therein. Plaintiffs' Appeal. On the coming in of the verdict the plaintiffs tendered the court judgment for $10,000, with interest from May 19, 1913, the date of the contract. The court refused to sign the judgment tendered by plaintiffs, and signed judgment for $10,000, with interest from the first day of the trial term February 5, 1917. The plaintiffs excepted and appealed. [3] Revisal, § 1954, is as follows: In plaintiffs' appeal, modified. In defendant's appeal, no error. (174 N. C. 665) MOORE et al. v. PACKER et al. (No. 486.) (Supreme Court of North Carolina. Dec. 5, 1917.) ANCE. Where defendant in an action filed answer and entered general appearance, and he and his surety on the bond given on dissolution of a restraining order filed such bond conditioned to pay the damages recovered, and both excepted to and gave notice of appeal from the judgment rendered, such conduct amounted to a general risdiction of the parties, and, it also having appearance by defendant, and gave the court jujurisdiction of the subject-matter, the judgment rendered by it was not void. 2. JUDGMENT 501-CONCLUSIVENESS - AT TACK FOR IRREGULARITY. If a judgment is erroneous, it is nevertheless an estoppel between the parties until corrected by appeal, and if defendants against whom it must be done by motion in the original cause. it is rendered wish to attack it for irregularity, 3. JUDGMENT 486 (1)-"VOID JUDGMENT”— "IRREGULAR JUDGMENT" "ERRONEOUS JUDGMENTS." "All sums of money due by contract of any kind whatsoever, excepting money due on penal bonds, shall bear interest, and when a jury shall render a verdict therefor, they shall distinguish the principal from the sum allowed as interest; and the principal sum due on all such contracts Judgments may be void, irregular, or erroneshall bear interest from the time of rendering ous, a “void judgment" being one that has merejudgment thereon until it be paid and satisfied." ly semblance, without some essential element In Barlow v. Norfleet, 72 N. C. 535, it is said: The judge left it to the jury to give the plaintiff interest or not, as they should think proper. We think he should have instructed them that, if they found that defendant owed the principal sum demanded, the plaintiff was entitled to interest, from the time it became due." The jury having found for the plaintiff in the principal sum, the court should have entered judgment bearing interest thereon from the date of the contract. Jolly v. Bryan, 86 N. C. 458, 463, which says: "As this [interest on verdict], however, can be corrected by a simple calculation, it is not necessary to disturb the verdict, but only to modify the judgment in this particular." This rule is approved in Lumber Co. v. Railway, 141 N. C. 171, 53 S. E. 823. or elements; an "irregular judgment" being one entered contrary to the course of the court, contrary to the method of procedure allowed by law in some material respect, and an "erroneous judgment" being one rendered contrary to law, remaining in effect until reversed or modified on appeal to a court of errors. [Ed. Note.-For other definitions, see Words and Phrases, First and Second Series, Void Judgment; Irregular Judgment; First Series, Erroneous Judgment.] Appeal from Superior Court, Caldwell County; Carter, Judge. Action by W. C. Moore and Van Wyck Hoke against H. B. Packer and L. Harrison. From order dissolving a restraining order against enforcement of a judgment, plaintiffs appeal. Affirmed. This is an action to restrain the collection of a judgment under execution. On March 12, 1913, Packer and Harrison, the defendants herein, instituted their civil action against W. C. Moore in the superior court of Burke county, and the sheriff made return upon the summons as follows: In an action on contract, when the jury finds the principal sum due thereon, which in this case was $10,000 (or nothing), said sum bears interest as a matter of law, and the court should give interest from the date of the contract, or from the time at which it "Received March 13, 1913. Served March was due under the contract. Bond v. Cot-13, 1913, by reading the within to W. C. Moore. ton Mills, 186 N. C. 20, 81 S. E. 936. J. P. Icard, Sheriff Caldwell County." A restraining order was issued in that [4] But when the action is in tort, the jury can allow interest or not, as it sees action, and it was returned as served on For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes |