#### P. T. LEHMAN and wife, S. E. LEHMAN, v. CICERO TISE.

(Decided April 11, 1899).

Mortgage — Notes—Judgment—Counterclaim.

Where a counterclaim consists of a judgment and promissory notes against the plaintiff, who is examined as a witness, and the judgment is proved hy the record, and there is no contention over the notes, the rule of preponderance of proof is inapplicable — they are both established, and the jury should he so told.

Civil ActioN for damages for breach of contract, tried before Coble J., at May Term, 1898, of Forsyth Superior Court.

The defendant denied the plaintiffs’ cause of action and pleaded counterclaims. There were verdict and judgment for plaintiffs and exception and appeal by defendant.

The opinion shows the contentions, evidence, issue, charge and exceptions.

Messrs. Jones & Patterson, for defendant (appellant).

Messrs. Watson, Buxton & Watson, for plaintiffs.

MONTGOMERY,, J.

The plaintiffs in their complaint allege that in March, 1891, the defendant proposed to the plaintiffs to convey to the feme plaintiff a certain lot of land in Winston, N. C., and to build a house thereon at the cost of $1,250, and take a note for the purchase price secured by mortgage on the property; that the plaintiffs declined the proposition, whereupon the defendant, to induce the plaintiffs to mahe the trade, guaranteed verbally that if the plaintiffs would buy the property on the terms proposed, that within twelve months the property should bring double the price agreed to be paid for it; and that as a further inducement to the plaintiffs to buy the property the defendant promised *444the male plaintiff that be would give bim employment in bis furniture store and real estate office at $15 per month, and that be would give to two sons of the plaintiffs, of the age of 17 and 19 respectively, employment in bis furniture factory at $1 and $1.25 respectively, and board until the wages of three should extinguish the debt for the purchase of the property; that the proposition was accepted, and that the defendant, after procuring the note and mortgage, refused to comply with his contract, refused to make good the guarantee as to the increased value of the property, and refused to give employment to the plaintiff and his sons as agreed upon; but on the other hand sold the property by direction of the Superior Court of Forsyth County in a proceeding brought to foreclose the mortgage and became the purchaser thereof himself from the commissioner appointed by the Court.

The defendant in his answer denies the allegation of the complaint, except as to the sale of the property to the feme plaintiff and the execution of the note and the mortgage for the purchase money, but without guarantees set out in the plaintiffs’ complaint, and the sale by the commissioner and the purchase of the property by himself. The defendant in his answer set up two counterclaims, one of $783 by judgment, as the balance due on the judgment in the foreclosure proceedings, and the other in the sum of $500, with accrued interest, due by notes and mortgage of the plaintiff, executed to the defendant for the purchase of two vacant lots in Winston.

The 7th issue submitted to the jury was in these words: “What amount is defendant entitled to recover of the plaintiff on his counterclaims,” and upon the instructions of his Honor on that issue the jury responded, “Nothing.” The defendant excepted to the instructions, and that exception furnishes the chief question for us to consider.

*445Tbe defendant introduced tbe judgment in evidence wbicb lie claimed as a set-off in tbe action and tbe notes of tbe plaintiffs for tbe vacant lots, and testified tbat nothing bad been paid on either. Tbe male plaintiff, himself a witness, made no contention over tbe notes, but did saj tbat before tbe judgment was bad in tbe foreclosure proceedings be bad made some payments on tbe notes upon wbicb tbe judgment was afterwards taken. Upon this condition of facts tbe Court instructed the jury.upon tbe Yth issue as follows:

> “Tbe plaintiffs contend tbat tbe jury should answer tbe Yth issue ‘Nothing’. The jury are instructed tbat, if defendant has shown, by a greater weight of tbe evidence, be is entitled to recover anything on bis counterclaim they will ascer-tian how much be is so entitled to recover and give such sums as their answer to tbe Ytb issue. Defendant testified tbat be sold tbe two vacant lots under tbe mortgage be held, and bid them off at bis own sale, and tbe jury are instructed tbat by such a sale the relations of tbe parties are not changed with regard to ibe lots, and tbat defendant still remains a mortgagee and plaintiff a mortgagor. Tbe defendant having tbe right to have tbe amount due paid, bolding tbe lots as security, and the plaintiff being entitled to bis equity of redemption ; and if be has failed to show by a preponderance of tbe evidence that be is entitled to recover anything on bis counterclaims, they will answer tbe Yth issue, ‘Nothing.’ ”

There was error in tbe instruction. Tbe rule of tbe greater' weight of evidence bad no application. Tbe judgment was proved as required by law, and tbe defendant introduced the notes of tbe plaintiffs for tbe vacant lots without any endorsed credits, and testified tbat nothing bad been paid upon them. Tbe plaintiff admitted tbe judgment and made no claim tbat the notes bad been paid. Tbe jury should have been instructed to find tbe amount of tbe judgment to be a *446set-off to which the defendant was entitled; and further, that if they believed the notes for the vacant lots had been executed and that no payments had been made upon them, they should find the defendant was entitled to the amount of the notes and interest, as a further set-off.

It is not necessary to consider the other exceptions. We will suggest, however, that it is not certain that the plaintiffs can sustain themselves as to that part of the action growing out of such a guarantee as the plaintiffs allege that the defendant made to them in reference to the future value of the real esate sold by the defendant to the plaintiffs. As that feature of the ease, however, embraces only a part of the present cause of action, and as a new trial will have to be granted for the error pointed out, the case will go back for trial without prejudice on the quaere suggested.

New trial.