{
  "id": 8554119,
  "name": "IN THE MATTER OF THE FORECLOSURE Of a Deed of Trust Executed by Juan C. Cooke, dated April 12, 1967, Recorded in Book of Mortgages 806, page 334, Durham County Registry; A. A. McDonald, Jr., Substitute Trustee",
  "name_abbreviation": "In re the Foreclosure of a Deed of Trust Executed by Cooke",
  "decision_date": "1978-08-15",
  "docket_number": "No. 7714SC767",
  "first_page": "575",
  "last_page": "580",
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  "court": {
    "name_abbreviation": "N.C. Ct. App.",
    "id": 14983,
    "name": "North Carolina Court of Appeals"
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    "id": 5,
    "name_long": "North Carolina",
    "name": "N.C."
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  "analysis": {
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  "last_updated": "2023-07-14T22:58:37.287571+00:00",
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    "date_added": "2019-08-29",
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  "casebody": {
    "judges": [
      "Judges Vaughn and Martin concur."
    ],
    "parties": [
      "IN THE MATTER OF THE FORECLOSURE Of a Deed of Trust Executed by Juan C. Cooke, dated April 12, 1967, Recorded in Book of Mortgages 806, page 334, Durham County Registry; A. A. McDonald, Jr., Substitute Trustee"
    ],
    "opinions": [
      {
        "text": "MORRIS, Judge.\nRespondent objected to the testimony of the payees/beneficiaries concerning the notes and transactions as being violative of the Dead Man\u2019s Statute, G.S. 8-51. The maker of the notes and grantor of the deed of trust is now deceased. G.S. 8-51 provides that\n\u201cUpon . . . the hearing upon the merits of a special proceeding, a party or person interested in the event, . . . shall not be examined as a witness in his own behalf or interest, . . . against the executor, administrator or survivor of a deceased person, . . . concerning a personal transaction or communication between the witness and the deceased person.\nThe testimony of Robert Carpenter, to which respondent objected, concerning the note to him and the failure of the deceased to pay the same when due should have been excluded. The Dead Man\u2019s Statute is clearly applicable to the testimony of a payee of a promissory note. McGowan v. Beach, 242 N.C. 73, 86 S.E. 2d 763 (1955); see also Perry v. Trust Co., 226 N.C. 667, 40 S.E. 2d 116 (1946). The trial court\u2019s error in admitting this testimony does not, however, warrant reversal.\nThere was sufficient evidence of execution and delivery in the testimony of the witness Sylvia Clayton. The notes and deed of trust were before the court. The introduction of the past due notes along with evidence of their execution and delivery would make out, in an action upon the notes, a prima facie case for the entire amount of the notes. Royster v. Hancock, 235 N.C. 110, 69 S.E. 2d 29 (1952); see also Whitley v. Redden, 276 N.C. 263, 171 S.E. 2d 894 (1970).\nThe same evidence, absent any evidence to the contrary, is sufficient to support a finding that the payee/possessor is the holder of a valid debt and that the debtor has defaulted. Similarly, the deed of trust was before the court and there was independent evidence, through Sylvia Clayton, of its execution and delivery. That deed of trust provides that, upon default, the trustee \u201cshall . . . sell any or all of said land at public auction. . . .\u201d Thus, even disregarding Robert Carpenter\u2019s testimony, there was other evidence of the same facts to which he testified sufficient to support the trial court\u2019s findings of fact. Where both competent and incompetent evidence is before the trial court, we assume that the trial court, when functioning as the finder of facts, relied solely upon the competent evidence and disregarded the incompetent evidence. Anderson v. Insurance Co., 266 N.C. 309, 145 S.E. 2d 845 (1966). Therefore, respondent\u2019s assignment of error No. 1 does not warrant reversal.\nRespondents tendered to the court a \u201cproposed order\u201d, moved the court to sign that order, excepted to the denial of that motion, and assigned as error the court\u2019s failure to make the findings of fact it contained. Respondents also excepted to the signing of the order proposed by petitioner. This exception is the basis for their assignment of error to the findings of fact contained in the order.\nRespondents argue that there is not sufficient evidence to support the required finding that Robert Carpenter and Edith Carpenter are holders of a valid debt. First, is there sufficient competent evidence of a valid debt? As we have previously noted, introduction of a promissory note along with evidence of execution and delivery makes out a prima facie case for the entire amount of the note in an action on a promissory note. Royster v. Hancock, supra. That same quantum of evidence, in the absence of probative evidence to the contrary, will support the finding of a valid debt in a proceeding to foreclose under a power of sale. Respondents, also, contend that there cannot be a \u201cvalid\u201d debt absent consideration. We take no position as to this general proposition, but we note that the word \"seal\u201d beside the maker\u2019s signature is legally sufficient to function as a seal, and, in the absence of proof by respondents that the maker did not adopt it as her seal, by law it is her seal. McGowan v. Beach, supra. A seal creates a presumption of consideration, Trust Co. v. Smith Crossroads, Inc., 258 N.C. 696, 129 S.E. 2d 116 (1963). Therefore, even if consideration were necessary, there is evidence to support a finding thereof.\nNext, is there sufficient competent evidence that Robert and Edith Carpenter are the holders of the notes? G.S. 25-1-201(20) defines a \u201cholder\u201d as \u201ca person who is in possession of ... an instrument . . . drawn, issued or endorsed to him or to his order or to bearer or in blank.\u201d We believe that this definition is applicable to G.S. 45-21.16. We are undoubtedly dealing with \u201cinstruments\u201d. One instrument was payable \u201cto Robert Turner Carpenter or order\u201d; the other, \u201cto Edith Ann Carpenter or order\u201d. Neither note was endorsed, and each was in the possession of the original payee. Ownership is not indispensable to holdership. See O.S. 25-3-301. Respondents do not dispute any of the crucial facts. These facts constitute ample evidence that Robert Carpenter and Edith Carpenter were holders of a valid debt.\nRespondents argue that there is not sufficient evidence of default to support a finding of default. We disagree. As we have previously noted, possession and introduction of a past due note makes out a prima facie case as to the entire amount of the note in an action on the note. Whitley v. Redden, supra. If the respondent in a proceeding to foreclose under a power of sale fails to offer any evidence to contradict the same type of evidence when it is introduced in a foreclosure proceeding, the trial court\u2019s finding of default will not be disturbed on appeal.\nRespondents\u2019 final argument is that the order of the trial court \u201cdoes not comply with the requirements of the foreclosure statute.\u201d Respondents argue that there was not a proper finding that Robert Carpenter and Edith Carpenter were holders of a valid debt. In his order, the judge referred to Robert Carpenter and Edith Carpenter as holders when he stated that \u201cthe holders of the Note\u201d presented evidence of ownership. The order also reveals that he considered the question of whether they were \u201cholders\u201d when he found that \u201cthe holders of the Notes and the Deed of Trust are entitled to proceed with the foreclosure of the same. . . .\u201d Similarly, the order incorporated a finding of a valid debt. The findings reflected \u201cevidence of the debt\u201d and clearly included a finding of default. Even if the finding as to \u201cdebt\u201d were insufficient, the finding of \u201cdefault\u201d must necessarily incorporate the concept of a binding obligation which, in this case, was the debt. In any event, the intent of the .trial court is plain, and we will not reverse the trial court for harmless error. Rule 61, North Carolina Rules of Civil Procedure.\nThe judgment of the trial court in ordering that petitioner be allowed to proceed with foreclosure is\nAffirmed.\nJudges Vaughn and Martin concur.",
        "type": "majority",
        "author": "MORRIS, Judge."
      }
    ],
    "attorneys": [
      "Joe C. Weatherspoon for petitioner appellee.",
      "Roger S. Upchurch for respondent appellant."
    ],
    "corrections": "",
    "head_matter": "IN THE MATTER OF THE FORECLOSURE Of a Deed of Trust Executed by Juan C. Cooke, dated April 12, 1967, Recorded in Book of Mortgages 806, page 334, Durham County Registry; A. A. McDonald, Jr., Substitute Trustee\nNo. 7714SC767\n(Filed 15 August 1978)\n1. Evidence \u00a7 11.7\u2014 dead man\u2019s statute \u2014 deceased\u2019s execution of note and deed of trust\nTestimony by the payee of a note concerning deceased\u2019s execution and delivery of the note and a deed of trust securing it and deceased's failure to pay the note when due should have been excluded under the dead man\u2019s statute, G.S. 8-51; however, the admission of such testimony was harmless error where there was other competent evidence of the same facts to which the payee testified sufficient to support the trial court\u2019s findings of fact.\n2. Mortgages and Deeds of Trust \u00a7 25; Seals \u00a7 1\u2014 foreclosure under power of sale \u2014 valid debt \u2014 seal \u2014 consideration\nIntroduction of a promissory note along with evidence of execution and delivery supported the finding of a valid debt in a proceeding to foreclose under a power of sale contained in a deed of trust securing the note; furthermore, if consideration was necessary to a \u201cvalid\u201d debt, the word \u201cseal\u201d beside the maker's signature created a presumption of consideration where there was no proof that the maker did not adopt it as her seal.\n3. Mortgages and Deeds of Trust \u00a7 25\u2014 foreclosure under power of sale \u2014 \u201cholders\u201d of notes\nIn a proceeding to foreclose a deed of trust, there was sufficient competent evidence that the beneficiaries of the deed of trust were \u201cholders\u201d of the notes secured thereby where each note was payable to a beneficiary or order, neither note was endorsed, and each note was in the possession of the original payee-beneficiary. G.S. 25-1-201(20); G.S. 45-21.16.\n4. Mortgages and Deeds of Trust \u00a7 25\u2014 foreclosure under power of sale \u2014default\nThere was sufficient evidence of default in a foreclosure proceeding where petitioner introduced evidence of past due notes secured by the deed of trust and possession of the notes by the payee-beneficiaries.\n5. Mortgages and Deeds of Trust \u00a7 25\u2014 foreclosure under power of sale \u2014holders of valid debt \u2014 sufficiency of order\nTrial court\u2019s order in a foreclosure proceeding sufficiently found that the beneficiaries of the deed of trust being foreclosed were the holders of a valid debt.\nAPPEAL by respondents from McKinnon, Judge. Judgment entered 9 June 1977, Superior Court, DURHAM County. Heard in the Court of Appeals 20 June 1978.\nPetitioner is a trustee under a certain deed of trust from Juan C. Cooke (now deceased) for the benefit of Robert Carpenter and Edith Carpenter covering real property in Durham County. He commenced this special proceeding 8 April 1977 before the Clerk of Court of Durham County seeking an order, pursuant to G.S. 45-21.16, allowing him to proceed to sell the property under the power of sale contained in the deed of trust. The Clerk found the following \u201cfacts\u201d:\n\u201cA. That there is a valid debt existing due the holder as alleged in the Petition.\nB. That there has been a default in the terms of the obligation.\nC. That there is the right to foreclose under the instrument set forth above.\nD.That notice has been given to those so entitled as by law provided.\nE. That the Petitioner and holder of the secured Note can proceed with foreclosure pursuant to the terms of the instrument and as by law provided.\u201d\nGeorge Henry Cooke, both individually and as Administrator of the estate of Juan Carpenter Cooke, gave notice of appeal. A stay was granted. A hearing was held in Superior Court. Sylvia Clayton, a witness to the promissory notes and the notary public who notarized the deed of trust, and Robert Turner Carpenter and Edith Ann Carpenter, the beneficiaries of the deed of trust, testified on behalf of the petitioner. The deed of trust and the two promissory notes which it secured were before the court. The promissory notes dated 12 April 1967 were identical in form, except that Edith Ann Carpenter was the payee of one and Robert Turner Carpenter was payee of the other, and each was in the amount of $7,000 bearing interest at 6% per annum, interest and principal being due and payable one year from date. The notes were signed as follows:\nher\nIsl Juan C. X Cooke [Seal]\nmark\nThe notes were witnessed by Sylvia D. Roycroft (now Sylvia Clayton) and B. Ray Olive. The deed of trust was similarly executed, notarized by Sylvia D. Roycroft (now Sylvia Clayton), and recorded. The deed of trust was of even date with the notes, secured the payment of said notes, and contained a power of sale. Sylvia Clayton testified that the notes and deed of trust were executed by the free and voluntary act of Juan C. Cooke.\nThe trial court concluded that \u201cwith sufficient evidence of default found, the holders of the Notes and the Deed of Trust are entitled to proceed with the foreclosure of the same . . .\u201d and ordered that petitioner could proceed with foreclosure.\nFrom that order respondents appeal.\nJoe C. Weatherspoon for petitioner appellee.\nRoger S. Upchurch for respondent appellant."
  },
  "file_name": "0575-01",
  "first_page_order": 603,
  "last_page_order": 608
}
