Lyon v. . Pender , 118 N.C. 147 ( 1896 )

The defendant David Pender was called and sworn as a witness for the plaintiff, and, the note being exhibited to him, testified as follows: "Pender Cotten were partners, doing business in 1889. I signed the note `Pender Cotten.' I borrowed the money to pay the debts. We borrowed money from time to time. It was necessary to do so. The money was used to pay the debts of the firm. I told Mr. Cotten all about the firm's indebtedness, and he authorized me to borrow the money."

Here the counsel for M. E. Cotten, administratrix of A. J. Cotten, objected to the witness speaking of any transaction or communication had with A. J. Cotten. The judge made no formal ruling on the objection raised at this stage of the case, but permitted the witness to go on, who testified: "That the firm debts were paid with this money; it was applied to debts due Station, to Johnson, Sutton Co., and to others whose names he could not recall, as he had no access to his books since his assignment; that his bookkeeper, William R. Ricks, knew to whom the money was paid."

Upon cross-examination, witness stated "that in 1884 he and M. C. Pender and A. J. Cotten formed a partnership for three years, under the firm name of Pender Cotten; then M. C. Pender came out, and myself and A. J. Cotten kept on under the same name. In January, 1889, myself, W. F. Hargrove and A. J. Cotten formed a partnership under the firm name and style of Pender, Hargrove (149) Cotten, and began business in January, 1889. We were partners when I gave this note, signed `Pender Cotten,' in liquidation. Mr. Cotten died in June, 1889. Hargrove and myself kept right on. The contract of Pender Cotten and Pender, Hargrove Cotten was in writing and signed by the partners — the first executed 7 March, 1884, and the second 29 January, 1889. The first contract was for three years, and Mr. Cotten and myself agreed after that to take M. C. Pender's interest. Mr. Cotten told me to borrow the money."

The counsel for the defendant M. E. Cotten, administratrix of A. J. Cotten, stated to the court that evidence had now been disclosed that the contracts of Pender Cotten and Pender, Hargrove Cotten were put in writing, and that the witness had gone on to state communications and transactions between himself and his partner, Cotten, who died in June, 1889, and asked the court to rule out all the evidence as to the agreements, which, the witness stated, were in writing and signed by the parties, respectively, and also that part of the evidence which related to personal transactions and communications between the witness and his deceased partner, A. J. Cotten, as incompetent. The court so ruled, and the plaintiff excepted.

W. R. Ricks, witness for the plaintiff, testified that at the beginning of the year 1889 A. J. Cotten and David Pender were doing business as Pender Cotten, and he was their bookkeeper, and he was also the bookkeeper of Pender, Hargrove Cotten when that firm was formed, 29 January, 1889. "I have no personal knowledge that the money borrowed paid the firm debts. All I know is that I made entries on books by direction of David Pender."

Counsel for Cotten, administratrix, objected to witness speaking, except what he knew of his own knowledge. Objection sustained. Thereupon plaintiff's counsel stated that he would (150) take a judgment against the defendant David Pender, and submitted to a nonsuit as to the defendant Cotten, administratrix, and appealed to the Supreme Court. The Code, sec. 590, is analyzed in Bunn v. Todd,107 N.C. 266. The witness Pender is (1) "a party to the action" (and is also "interested in the event of the action"); (2) he is offered "as a witness to testify in own behalf of interest," and (3) "as to a personal transaction or communication between the witness and a person since deceased," i.e., to prove a partnership, and, further, that the deceased partner specially authorized him to borrow this money. The only possible debate is on the second head, above stated, whether the evidence given by the witness would be "in his own interest." Strictly, it would be "in the behalf" of plaintiffs, who called him as a witness, but the statute contains the words "in his own behalf or interest." The true test of interest is whether the judgment obtained herein could be used as conclusive of the liability of the intestate's estate in an action afterwards brought by the witness against the administrator of the deceased. Jones v. Emry, 115 N.C. 158. If by the testimony of the witness a judgment is obtained, not only against himself (which is not opposed), but also against his codefendant, who is the administratrix of one sought to be charged, as his partner, then the witness, upon paying off such judgment, could proceed to recover the pro rata share out of his codefendants, and this judgment, obtained against the two, being conclusive in each action of the partnership, would bind the said administratrix to contribution. (151) Thus the testimony of the witness would be "in his own interest" and is forbidden by the statute.

If the action was between the alleged partners, the testimony of the witness (the alleged surviving partner) would be incompetent to prove the partnership. Sikes v. Parker, 95 N.C. 232; Armfield v. Colvert,103 N.C. 147.

This case differs widely from Sutton v. Walters, post, 495. In that case the witness was the principal in the bond sued on, against whom judgment was taken, and he testified as to a personal communication between himself and his deceased surety. But this was not "in the interest of the witness," whose liability was primary, and who could in no wise be benefited, nor could the judgment against him be in anywise abated by the judgment obtained upon his testimony against the surety. But in this case, if the witness' testimony establishes the partnership, the witness, upon paying off the judgment, can recover his pro rata share out of his codefendant's estate, since the judgment would establish that the debt was due by both as partners, i. e., as coprincipals. In excluding the testimony there was

No Error.

Cited: Fertilizer Co. v. Rippy, 123 N.C. 658; s. c., 124 N.C. 650;Moore v. Palmer, 132 N.C. 973; Bonner v. Stotesburg, 139 N.C. 7.

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