#### C. M. BURNS v. T. R. TOMLINSON.

(Filed 20 May, 1908).

1. Contracts, Wagering — Futures—Evidence.

In an action upon contract for damages for failure to deliver cotton at a future time, when the price had become higher, and the defense was that it was a gambling contract, or “futures,” forbidden by Revisal, sec. 1689, in reply to which plaintiff testified he expected actual delivery, it was error in the lower court to exclude evidence offered in behalf of defendant that neither he nor plaintiff expected actual delivery; that it was a dealing in futures and not a dona fide sale; that their course of dealings had been in futures; that another person stated in the presence of plaintiff and defendant at the time of the execution of the contract that it could be closed out by either party by paying the difference, which was not denied, and that the transaction occurred in a “bucket shop.”

2. Same — Transactions Prior to 1905.

This transaction occurred prior to the enactment of chapter 538, Laws 1905, and only so much of Revisal, see. 16S9, applies as was embraced in chapter 221, Laws 1S89.

ActioN tried before Webb, Jand a jury, at October Term, 1907, of Anson.

Defendant appealed.

Robinson & Gaudle, J. A. Lockhart and J. T. Bennett for plaintiff.

McLendon & Thomas and J. W. Qulledge for defendant.

Clare, C. J.

This is an action to recover a loss of $1,264.05 upon a contract made by defendant 16 February, 1905, to deliver to the plaintiff during October, 1905, 100 bales of cotton at 7% cents. Ootton was higher in October, and the defendant did not deliver. The defendant pleaded in his verified answer that this was a gambling contract, or “future,” forbidden by the act of 1889, now Revisal, sec. 1689. This cast upon the plaintiff the “burden to prove by proper evidence, other than any written evidence thereof, that the contract sued upon is a lawful one in its nature and pur*635poses.” Revisal, sec. 1691. Tbe placing ¿be burden of proof is in tbe legislative power, even in criminal cases. Connor, J., in State v. Barrett, 138 N. C., 630, wbicb is a very full and conclusive discussion of tbe point; State v. Hinnant, 120 N. C., 787; State v. Surles, 117 N. C., 726; State v. Burton, 113 N. C., 655. Tbis feature in tbis particular statute was sustained in State v. McGinnis, 138 N. C., 730.

Tbe plaintiff testified tbat be expected tbe defendant to make actual delivery of tbe cotton; tbat be did not buy tbe cotton for bis cotton mill; tbat be bad bought and sold a great many contracts on wbicb be did not receive and deliver cotton; tbat tbe defendant was a speculator in cotton; tbat up to tbis default tbe defendant bad paid bim for all bis transactions ; tbat be (tbe plaintiff) bad speculated a great deal in cotton.

Tbe defendant testified tbat tbe contract was purely speculative. In tbis conflict of evidence it was error to exclude tbe defendant’s testimony tbat tbe contract was made in a “bucket sbop,” and tbat contracts for “futures” were made in tbat place. Tbis, taken with tbe other evidence, might have thrown some light on tbe nature of the- transaction. It was also error to refuse to permit tbe defendant to answer tbe question whether or not be expected to deliver tbe cotton, and whether or not tbe plaintiff expected to receive actual delivery of tbe cotton. Tbe court also excluded testimony offered tbat another person stated in tbe presence of plaintiff and defendant at tbe time of tbe execution of tbe contract tbat it could be closed out by either party by paying tbe difference. Tbe court also erroneously excluded evidence of conversation between tbe parties on- a subsequent date as to tbe contract. Tbe court also refused to permit tbe defendant to answer tbe question whether tbis “was an actual contract to deliver cotton or a future contract.” Tbe court further refused to permit tbe defendant to answer questions tending *636to show a course of dealing in “futures” between the plaintiff and defendant extending over several years and down to this time without any actual delivery of cotton. Exceptions were taken in apt time.

It can require no elaborate discussion to hold that 'the above evidence was competent to aid the jury in determining whether this was a bona 'fide contract or a sale of a “future” forbidden by law. The plaintiff himself testified that he did not buy in the ordinary course of his business as a cotton manufacturer for use in his mill. He is not therefore excepted out of Revisal, sec. 1689, and by virtue of Revisal, secs. 1690 and 1691, prima, facie this was a “future contract,” and 'but for plaintiff’s testimony that he expected actual delivery the court might have directed a nonsuit. Certainly it was error to refuse to permit the defendant to testify that neither he nor the plaintiff expected actual delivery, and that this was a dealing in futures and not a bona fide sale, and to prove also that the course of dealings between them for years had been trading in futures; that the transaction was made in a “bucket shop” and that the remarks made at the time in the hearing of the parties, and not denied by plaintiff, indicated that this was a deal in “futures.” It is not necessary to consider the other exceptions. The jury should have had the aid of the excluded testimony in passing upon the “true inwardness” and nature of this transaction.

This transaction, unlike that set out in plaintiff’s appeal in this case, occurred prior to the enactment of chapter 538, Laws 1905, and we have not been inadvertent to the fact that only so much of Revisal, sec. 1689, applies as was embraced in chapter 221, Laws 1889. State v. Clayton, 138 N. C., 732.

New Trial.