#### SEARS, ROEBUCK & COMPANY, a corporation, v. ROUSE BANKING COMPANY, a corporation.

(Filed 31 March, 1926.)

1. Banks and Banking — Principal and Agent — Vendor and Purchaser— Special Accounts — Implied Scope of Authority.

The % cashier of a bank has implied authority to agree with the purchaser and seller of materials for a dwelling, that, for the protection of the seller it will create a special deposit from funds it has on deposit from the purchaser, to pay for the materials upon notice by the depositor that the materials ordered had been received and had come up to specifications, etc.

2. Same — Contracts—Breach.

Where the cashier of a bank has agreed with the seller of goods to its depositor to create a special account from his deposit to pay for the materials upon notification that the goods had been received and were as contracted for, an express condition that the bank would not assume liability in connection with the transaction: Held, the responsibility referred to was one which may arise between the vendor and vendee, and did not contemplate that which would follow the breach of the bank’s agreement to perform its own contract.

3. Same — Evidence.

Where a bank has agreed to create a special deposit to be held for the security of one selling goods to its depositor, and to be paid upon the latter’s notification that the goods specified were in accordance with the terms of purchase, evidence that the bank had permitted its depositor to withdraw the special account, after he had received and used the goods, is sufficient upon the question of whether the bank had breached its contract, and its liability to the seller.

4. Evidence — Pleadings.

It is competent to introduce in evidence distinct and separate parts of the adversary’s pleadings, without introducing other parts thereof qualifying or explaining the subject-matter.

5. Trials — Argument of Counsel — Statutes—Instructions.

While the attorneys in the case are permitted by Statute, C. S., 203, to argue the whole case as well of law as of facts to the jury, it is for the trial judge to instruct them upon the law, and he may correctly tell them to disregard the law as argued to them by counsel.

6. Interest — Contracts—Tort—Judgments.

In an action upon contract, interest upon its breach may be awarded from the time the principal sum was due thereunder, and in tort, the allowing of interest may be made or not as the jury sees fit: and where no interest is allowed by the verdict in case of torts the judgment bears interest from the first day of the term in which it was rendered.

Appeal from Barnhill, J., and a jury, November Term, 1925, of LeNOie. No error.

*501Tbis action was founded on tbe following correspondence:

“LaGrange, N. 0., July IB.

“Sears, Eoebuck & Company,

“Chicago, Ill.

“J. E. "Warters deposited $3,418.45 to pay for material wben inspected and found satisfactory sbip out lumber at once.

“Eouse Banking Company.”

“July 27.

“Eouse Banking Company, LaGrange, N. C.

“Gentlemen r — •

“We have your telegram advising that J. E. Martins (Warters) deposited $3,418.45 with your bank to pay for material wben inspected and found satisfactory.

“Wa are entering tbe order for shipment to go forward as promptly as possible. To complete tbe transaction and in line with our regular order, we desire tbe attached form properly signed, and for your convenience in returning are enclosing a stamped envelope.

“We appreciate your cooperation in connection with tbis deal and take tbis opportunity to thank you. Yours truly,

Enc. “Sears, Eoebuck & Company.”

“Sears, Eoebuck & Company

“Chicago.”

“In reply to tbis letter address department—

“Date — July 30, 1920.”

“Sears, Eoebuck and Company,

“(Credit Department),

“Chicago, Ill.

“Gentlemen: — ■

“J. E. Warters, Box 112, LaGrange, N. C., has deposited with us tbe sum of $3,418.45, which has been set aside in a special fund subject to your order, same to be paid to you on delivery of tbe building material ordered, with tbe understanding that tbe goods are to conform with your specifications and meet with tbis depositor’s approval. Tbe material is to be inspected immediately on receipt and, if satisfactory, accepted by depositor, who will then notify us to send you tbe money.

“It is understood, however, that no responsibility in connection with any of tbe foregoing matters is to attach to tbis bank or any of its officers. Yours truly,

“Eouse Banking Company (Bank)

“By J. P. JoYNER, Assistant Cashier,

“LaGrange, N. C.”

*502“February 1, 1921.

“Rouse Banking Company,

“LaGrange, N. C.

“Gentlemen :•—

“Attention Mr. J. P. Joyner, Assistant Cashier.

“Referring to the building material account of Mr. J. E. Martins, (Warters), which is open under our number CR-805641, for which Mr. Martins (Warters) deposited $3,418.45, with you to pay the account, we wish to advise that as we have complied with our part of the agreement, the above amount should be forwarded to us without delay.

“It is important that this matter should have your prompt attention and we will look for a check for the above amount in payment of the account very shortly. Yours truly,

“Sears, Roebuck & Company.”

The assets of Rouse Banking Company, were taken over by the National Bank of LaGrange, and it has been made a party to the action. It had notice of plaintiff’s claim, and plaintiff contended it was liable and had assumed “liability and responsibility for the payment of the claims.” This was denied by defendants.

“The defendant, Rouse Banking Company, (1) denied the authority of the assistant cashier, and contended that the transaction was ultra vires; (2) There had been no compliance on plaintiff’s part “in respect to conforming to specifications, meeting the consignee’s approval, nor with the inspection provided for not advised as to acceptance by the consignee nor any notification in respect to sending the money as set forth.” (3) “It is understood, however, that no responsibility in connection with any of the foregoing matters is to attach to this bank or any of its officers,” and this defendant is advised, informed and believes, and upon information and belief alleges, that the defendant assumed no responsibility in respect to the payment of said funds; and this defendant is further advised, informed and believes, and upon information and belief alleges, that if the said writing had been authorized by this defendant, the defendant realleging that it was not authorized, that nevertheless the plaintiff was guilty of such laches and negligence in respect thereto that this defendant would be relieved and absolved from liability in the premises.”

The issues' submitted to the jury and their answers thereto were as follows:

“1. Did J, E. Warters deposit with the Rouse Banking Company $3,418.45 to be set apart subject to the order of the plaintiff to be paid to the plaintiff on delivery of the building material ordered when such material was received and accepted by said Warters? Answer: Yes.

*503 “2. Did tbe plaintiff, Sears, Roebuck & Company, skip to and did J. E. Warters receive and accept tbe lumber and material ordered by Warters from tbe plaintiff as alleged in tbe complaint? Answer: Yes.

“3. Wbat amount, if any, was J. E. Warters required to pay out as freight wbicb tbe plaintiff bad contracted to pay? Answer: $105.99.

“4. Has tbe defendant, Rouse Banking Company, failed and refused to pay over said funds to tbe plaintiff as alleged? Answer: Yes.

“5. Is tbe defendant, National Bank of LaGrange, liable upon said account? Answer: Yes.”

Numerous exceptions and assignments of error were made in tbe court below. Tbe material ones and necessary facts will be considered in tbe opinion.

Dawson & Jones, F. E. Wallace and Manning & Manning for plaintiff.

Bouse & Bouse for defendants.

Clarkson, J.

Tbe whole controversy binges on tbe letter of tbe assistant cashier of defendant, Rouse Banking Company, to plaintiff Sears, Roebuck & Company. Analyse tbe letter: (1) J. E. Warters, Box 112, LaGrange, N. C., has deposited with us tbe sum of $3,418,45, wbicb has been set aside in a special fund subject to your order; (2) same to be paid to you on delivery of tbe building material ordered, with tbe understanding that tbe goods are to conform to your specifications and meet with this depositor's approval; (3) Tbe material is to be inspected immediately on receipt and if satisfactory accepted by depositor, who will then notify us to send you tbe money. (4) It is understood, however, that no responsibility in connection with any of tbe foregoing matters is to attach to this bank or any of its officers.

Tbe above letter was dated 30 July, 1920, and demand was made by plaintiff on 1 February, 1921. It is admitted by tbe Rouse Banking Company, “that at the time of sending tbe letter above referred to, that the said Warters bad tbe amount in bank, but that it was never advised that tbe material bad been inspected, found satisfactory or inspected by Warters, and that it bad never been notified by Warters to remit tbe money to tbe plaintiff, and that when demand was made, on 1 February, 1921, by tbe plaintiff upon tbe bank for payment, Warters bad withdrawn all bis moneys from tbe bank and bad no money on deposit.”

Tbe first ground of defense by defendant: “It is understood, however, that no responsibility in connection with any of tbe foregoing matters is to attach to this bank or any of its officers.” This ground is untenable, tbe bank never carried out its agreement. Tbe representation by tbe bank to plaintiff was that it bad a deposit set aside in a special *504 fund subject to plaintiff’s order. In tbis respect it broke its agreement and allowed J. E. Warters to withdraw tbis special fund. No responsibility would attach to the bank or any of its officers if it bad kept its agreement and the special fund remained in bank. The defendant bank cannot take advantage of its own wrong. Nullus commo-dum capere potest de mjuria sua propria. No one can obtain an advantage by bis own wrong. Co. Litt., 148; Broom Max., 279; Black’s Law Dic. (2 ed.), 837.

The defendant, Nouse Banking Company, further contends that there was no evidence that the material upon receipt was inspected and found satisfactory by the consignee, and excepted and assigned as error the following excerpts from the charge of the court below: “Gentlemen of the jury, if you should find from this evidence, that Warters deposited with the Nouse Banking Company, already having money there, instructed them to set it apart and hold the same to the use of the order of Sears, Noebuck & Company, to be paid to Sears, Noebuck & Company, when they had complied with the order that he had made to them for certain lumber, and when the same had been received and approved by him, and that they so received the deposit and so advised the plaintiff eomr pany and that they had the money, then they had no right to return that money to Warters without the consent of Sears, Noebuck & Company, any more than they had the right to pay it to Sears, Noebuck & Company, until it had complied with that order, and delivered the merchandise with the approval of Warters, who ordered the same. It was their duty to hold it after they so received it in accordance with that agreement, if they did so receive it, and the plaintiff has complied with their part of the contract by delivering the material, and same has been received and approved by Warters, then it is their duty to turn the money over to the plaintiff, as they contracted to do, that is, they held it subject to the order and subject to the disposition of the plaintiff company irrespective of anything that may have been said in the letter that they sent to the plaintiff.”

Without repeating, we think there was abundant evidence, direct and circumstantial, to support this charge which went to the heart of the controversy and under the facts of this case a correct charge of the law.

In the case of Mason v. Wilson, 84 N. C., p. 51, one Green owed a note of $80.00 to plaintiff Mason. Green left the State, but before going left his property in the hands of Wilson, the defendant. The plaintiff testified, and it was so found by the jury, that Green told her “that he had left all of his property in the hands of the defendant Wilson, out of which her debt would be paid, as he had given Wilson instructions to that effect. To which Wilson replied that he had the property and that as soon as he could sell it, he would pay her debt. That the de*505fendant bad since sold tbe property and that sbe bad after such sale demanded payment wbicb tbe defendant refused.” Tbe court below charged tbe jury: “That if they believed that tbe defendant Wilson received tbe property from tbe defendant Green promising to pay tbe plaintiff’s debt out of tbe proceeds, and bad thereafter verbally promised plaintiff to pay her debt in tbe manner described by her, and afterwards refused to do so, that plaintiff was entitled to their verdict.” Ashe, J., sustained tbe charge in tbe case. In tbe ease tbe liability was attacked solely on tbe statute of frauds. This case has been approved many times and recently in Mercantile Co. v. Bryant, 186 N. C., p. 551.

It is contended by defendant, Rouse Banking Company, that it bad no authority to make tbe promise, and tbe agreement was ultra vires, and cites tbe case of Quarries Co. v. Bank, 190 N. C., p. 277. In tbe Quarries Company case, tbe principle laid down “a banking corporation cannot lend its credit to another by becoming surety, endorser or guarantor for him. 3 R. C. L., 425.” In that case it was a bare, naked promise and tbe bank bad no fund in its possession, as in tbe present case, upon wbicb tbe promise was made.

Tbe principle laid down in 3 R. C. L., part see. 437, is as follows: “Officers of a bank are but its agents, and like other agents can bind tbe bank only when acting within tbe scope of their authority, but when a bank opens its doors for business with tbe public, and places officers in charge, persons dealing with them in good faith, and without any notice of any want of authority, will he protected where an act is performed in an apparent scope of the officers authority, whether the officer was actually clothed with such authority or not. (Italics ours.) Officers of banks are held out to tbe public as having authority to act according to tbe general usage, practice and course of business of such institutions, and their acts, within tbe scope of such usage, practice and course of business, bind tbe bank in favor of third persons having no knowledge of a limitation on their authority, and it is immaterial what tbe person’s official position may be if be is actually engaged in tbe management of tbe bank’s interests.” Bobbitt Co. v. Land Co., ante, p. 323.

Tbe introduction of portions of tbe answer comes within tbe rule laid down in Jones v. R. R., 176 N. C., 268, where it is held: “It is tbe settled rule of procedure in this jurisdiction that a party may offer in evidence a portion of bis adversary’s pleadings containing an allegation or admission of a distinct and separate fact’ relevant to tbe inquiry and without introducing qualifying or explanatory matter, tbe rule being further to tbe effect that in such case it is open to tbe opposing party to introduce such qualifying matter if be so desires. Wade v. Contracting Co., 149 N. C., 177; Sawyer v. R. R., 145 N. C., 24; *506 Lewis v. R. R., 132 N. C., 382.” Weston v. Typewriter Co., 183 N. C., p. 2; Construction Co. v. R. R., 185 N. C., 46.

The defendants’ counsel argued to tbe jury that the case of Quarries Co. v. Bank, supra, was authoritative and complains that the court below instructed the jury that it was good law and the law of North Carolina, but not the law as applicable to the facts in the present case. That the jury , should disregard anything said by counsel as to that being the law of the case at bar and they should be guided by what the court said is the law in the case. Counsel have a.right to argue the law and facts to the jury, but it is incumbent on the court below to charge the law in the particular case applicable to the facts, and it is incumbent on the jury to follow the law as laid down by the court and not by counsel. Any other rule would make the jury both construe the law and decide the facts. Such is not the statute. “In jury trials the whole case as well of law as of facts may be argued to the jury.” Latter part C. S., 203. The Quarries case, supra, was not applicable to the facts in the present case. The court below was correct in its charge.

The alleged contract of assumption by National Bank of LaGrange of outstanding contracts and obligations of Rouse Banking Company, under the disputed facts was left to the jury. We think the charge correct. Defendants’ objection cannot be sustained. We think the plaintiff was entitled to interest.

In Chatham v. Realty Co., 174 N. C., 674, it is held: “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 was due under the contract. Bond v. Cotton Mills, 166 N. C., 20. But when the action is in tort, the jury can allow interest or not, as it sees, fit, and, therefore, when the jury does not assess interest the verdict and judgment bear interest only from the first day of the term at which the judgment is rendered. Harper v. R. R., 161 N. C., 451; Hoke v. Whisnant, at this term.” C. S., 2309; Cook v. Mfg. Co., 182 N. C., 205; Perry v. Norton, 182 N. C., 589; Bell v. Danzer, 187 N. C., 224.

We have considered the material assignments of error, the others present no novel or new proposition of law. On the entire record we think the case properly tried in accordance with law. Individuals must perform their contracts — so must corporations. Two corporations are contesting over a written contract easily understood. The bank, by its letter to plaintiff, distinctly informed it that it had a special fund put there for the purpose of paying for building material to be shipped by plaintiff to the party who had ordered the material and deposited the *507fund. Plaintiff, relying on this letter, shipped the material and the finding of the jury, from competent evidence, was that the conditions of the contract were complied with by plaintiff. Defendant banking company, pleads lack of authority and ultra vires. It had the money in its bank for the purpose of paying for the building material. It allowed this special fund to be withdrawn contrary to its contract, and it cannot .now set up the plea of lack of authority and ultra vires. No fraud or mutual mistake is alleged or shown. Sueh a plea, under the facts here, would destroy business confidence and the integrity of contracts. We find

No error.