{ "id": 8559879, "name": "BORDEN, INC. v. JAMES C. BROWER, T/A HARVEST MILLING COMPANY", "name_abbreviation": "Borden, Inc. v. Brower", "decision_date": "1973-10-10", "docket_number": "No. 1", "first_page": "54", "last_page": "67", "citations": [ { "type": "official", "cite": "284 N.C. 54" } ], "court": { "name_abbreviation": "N.C.", "id": 9292, "name": "Supreme Court of North Carolina" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "193 S.E. 2d 751", "category": "reporters:state_regional", "reporter": "S.E.2d", "opinion_index": -1 }, { "cite": "17 N.C. App. 249", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8554974 ], "opinion_index": -1, "case_paths": [ "/nc-app/17/0249-01" ] }, { "cite": "189 S.E. 2d 208", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1972, "opinion_index": 0 }, { "cite": "281 N.C. 604", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8575723 ], "year": 1972, "opinion_index": 0, "case_paths": [ "/nc/281/0604-01" ] }, { "cite": "38 N.C.L. Rev. 540", "category": "journals:journal", "reporter": "N.C. L. Rev.", "year": 1960, "opinion_index": 0 }, { "cite": "38 N.C.L. Rev. 543", "category": "journals:journal", "reporter": "N.C. L. Rev.", "year": 1960, "opinion_index": 0 }, { "cite": "148 S.E. 2d 531", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1966, "opinion_index": 0 }, { "cite": "267 N.C. 576", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8559935 ], "year": 1966, "opinion_index": 0, "case_paths": [ "/nc/267/0576-01" ] }, { "cite": "108 S.E. 2d 594", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1959, "pin_cites": [ { "page": "596" } ], "opinion_index": 0 }, { "cite": "250 N.C. 355", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8623083 ], "weight": 2, "year": 1959, "pin_cites": [ { "page": "357" } ], "opinion_index": 0, "case_paths": [ "/nc/250/0355-01" ] }, { "cite": "71 A.L.R. 548", "category": "reporters:specialty", "reporter": "A.L.R.", "year": 1931, "pin_cites": [ { "page": "570-75" } ], "opinion_index": 0 }, { "cite": "80 N.C. 219", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8689264 ], "year": 1877, "pin_cites": [ { "parenthetical": "bond to be credited with the proceeds from sale of cotton" } ], "opinion_index": 0, "case_paths": [ "/nc/80/0219-01" ] }, { "cite": "34 S.E. 542", "category": "reporters:state_regional", "reporter": "S.E.", "year": 1899, "pin_cites": [ { "parenthetical": "note to be paid out of proceeds of another note" } ], "opinion_index": 0 }, { "cite": "125 N.C. 447", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 11274183 ], "year": 1899, "pin_cites": [ { "parenthetical": "note to be paid out of proceeds of another note" } ], "opinion_index": 0, "case_paths": [ "/nc/125/0447-01" ] }, { "cite": "137 S.E. 320", "category": "reporters:state_regional", "reporter": "S.E.", "year": 1927, "pin_cites": [ { "parenthetical": "note to be paid out of proceeds from sale of goods" } ], "opinion_index": 0 }, { "cite": "163 S.E. 589", "category": "reporters:state_regional", "reporter": "S.E.", "year": 1932, "pin_cites": [ { "parenthetical": "note to be paid out of proceeds of land" } ], "opinion_index": 0 }, { "cite": "202 N.C. 461", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8627092 ], "year": 1932, "pin_cites": [ { "parenthetical": "note to be paid out of proceeds of land" } ], "opinion_index": 0, "case_paths": [ "/nc/202/0461-01" ] }, { "cite": "166 S.E. 313", "category": "reporters:state_regional", "reporter": "S.E.", "year": 1932, "pin_cites": [ { "parenthetical": "note to be paid out of rents collected by maker" } ], "opinion_index": 0 }, { "cite": "167 S.E. 811", "category": "reporters:state_regional", "reporter": "S.E.", "year": 1933, "pin_cites": [ { "parenthetical": "note to be paid out of collateral held by payee and such payment to be credited to an endorser" } ], "opinion_index": 0 }, { "cite": "172 S.E. 884", "category": "reporters:state_regional", "reporter": "S.E.", "year": 1934, "pin_cites": [ { "parenthetical": "note to be paid out of proceeds of land when land was sold" } ], "opinion_index": 0 }, { "cite": "206 N.C. 124", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8629079 ], "year": 1934, "pin_cites": [ { "parenthetical": "note to be paid out of proceeds of land when land was sold" } ], "opinion_index": 0, "case_paths": [ "/nc/206/0124-01" ] }, { "cite": "176 S.E. 303", "category": "reporters:state_regional", "reporter": "S.E.", "year": 1934, "pin_cites": [ { "parenthetical": "note to be paid by crediting it against payee's anticipated share of maker's estate" } ], "opinion_index": 0 }, { "cite": "207 N.C. 165", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8624077 ], "year": 1934, "pin_cites": [ { "parenthetical": "note to be paid by crediting it against payee's anticipated share of maker's estate" } ], "opinion_index": 0, "case_paths": [ "/nc/207/0165-01" ] }, { "cite": "177 S.E. 643", "category": "reporters:state_regional", "reporter": "S.E.", "weight": 2, "year": 1935, "pin_cites": [ { "parenthetical": "co-maker's liability on a note limited to the value of land covered by a deed of trust" } ], "opinion_index": 0 }, { "cite": "1 S.E. 2d 123", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1939, "pin_cites": [ { "parenthetical": "note to be paid out of commissions" } ], "opinion_index": 0 }, { "cite": "215 N.C. 92", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8628280 ], "year": 1939, "pin_cites": [ { "parenthetical": "note to be paid out of commissions" } ], "opinion_index": 0, "case_paths": [ "/nc/215/0092-01" ] }, { "cite": "25 S.E. 2d 836", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1943, "pin_cites": [ { "parenthetical": "note to be paid out of rents and profits from an office building" } ], "opinion_index": 0 }, { "cite": "223 N.C. 284", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8606249 ], "year": 1943, "pin_cites": [ { "parenthetical": "note to be paid out of rents and profits from an office building" } ], "opinion_index": 0, "case_paths": [ "/nc/223/0284-01" ] }, { "cite": "46 S.E. 2d 715", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1948, "pin_cites": [ { "parenthetical": "note to be paid out of profits of a partnership in which maker and payee were engaged" } ], "opinion_index": 0 }, { "cite": "228 N.C. 636", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8627874 ], "year": 1948, "pin_cites": [ { "parenthetical": "note to be paid out of profits of a partnership in which maker and payee were engaged" } ], "opinion_index": 0, "case_paths": [ "/nc/228/0636-01" ] }, { "cite": "54 S.E. 847", "category": "reporters:state_regional", "reporter": "S.E.", "year": 1906, "opinion_index": 0 }, { "cite": "33 N.C.L. Rev. 420", "category": "journals:journal", "reporter": "N.C. L. Rev.", "year": 1955, "opinion_index": 0 }, { "cite": "54 S.E., 847", "category": "reporters:state_regional", "reporter": "S.E.", "opinion_index": 0 }, { "cite": "142 N.C., 61", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8651598 ], "weight": 2, "opinion_index": 0, "case_paths": [ "/nc/142/0061-01" ] }, { "cite": "114 S.E. 391", "category": "reporters:state_regional", "reporter": "S.E.", "opinion_index": 0 }, { "cite": "184 N.C., 230", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 11269873 ], "opinion_index": 0, "case_paths": [ "/nc/184/0230-01" ] }, { "cite": "181 S.E., 264", "category": "reporters:state_regional", "reporter": "S.E.", "opinion_index": 0 }, { "cite": "208 N.C., 418", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8608822 ], "opinion_index": 0, "case_paths": [ "/nc/208/0418-01" ] }, { "cite": "137 S.E., 320", "category": "reporters:state_regional", "reporter": "S.E.", "opinion_index": 0 }, { "cite": "193 N.C., 470", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 2217650 ], "weight": 2, "pin_cites": [ { "parenthetical": "note to be paid out of proceeds from sale of goods" } ], "opinion_index": 0, "case_paths": [ "/nc/193/0470-01" ] }, { "cite": "150 S.E., 886", "category": "reporters:state_regional", "reporter": "S.E.", "opinion_index": 0 }, { "cite": "198 N.C., 148", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8600891 ], "opinion_index": 0, "case_paths": [ "/nc/198/0148-01" ] }, { "cite": "166 S.E., 313", "category": "reporters:state_regional", "reporter": "S.E.", "opinion_index": 0 }, { "cite": "203 N.C., 498", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8614036 ], "weight": 2, "pin_cites": [ { "parenthetical": "note to be paid out of rents collected by maker" } ], "opinion_index": 0, "case_paths": [ "/nc/203/0498-01" ] }, { "cite": "167 S.E., 811", "category": "reporters:state_regional", "reporter": "S.E.", "opinion_index": 0 }, { "cite": "204 N.C., 198", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8614353 ], "weight": 2, "pin_cites": [ { "parenthetical": "note to be paid out of collateral held by payee and such payment to be credited to an endorser" } ], "opinion_index": 0, "case_paths": [ "/nc/204/0198-01" ] }, { "cite": "177 S.E., 643", "category": "reporters:state_regional", "reporter": "S.E.", "opinion_index": 0 }, { "cite": "207 N.C., 529", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8627125 ], "weight": 3, "pin_cites": [ { "parenthetical": "co-maker's liability on a note limited to the value of land covered by a deed of trust" } ], "opinion_index": 0, "case_paths": [ "/nc/207/0529-01" ] }, { "cite": "146 S.E., 708", "category": "reporters:state_regional", "reporter": "S.E.", "opinion_index": 0 }, { "cite": "196 N.C., 672", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8628744 ], "opinion_index": 0, "case_paths": [ "/nc/196/0672-01" ] }, { "cite": "183 S.E. 606", "category": "reporters:state_regional", "reporter": "S.E.", "year": 1936, "opinion_index": 0 }, { "cite": "209 N.C. 174", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 2221289 ], "year": 1936, "opinion_index": 0, "case_paths": [ "/nc/209/0174-01" ] }, { "cite": "180 S.E. 2d 823", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1971, "opinion_index": 0 }, { "cite": "278 N.C. 523", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8561041 ], "year": 1971, "opinion_index": 0, "case_paths": [ "/nc/278/0523-01" ] }, { "cite": "186 S.E. 2d 400", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1972, "opinion_index": 0 }, { "cite": "280 N.C. 460", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8572515 ], "year": 1972, "opinion_index": 0, "case_paths": [ "/nc/280/0460-01" ] }, { "cite": "108 S.E. 2d 594", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1959, "opinion_index": 1 }, { "cite": "250 N.C. 355", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8623083 ], "year": 1959, "opinion_index": 1, "case_paths": [ "/nc/250/0355-01" ] } ], "analysis": { "cardinality": 1115, "char_count": 32193, "ocr_confidence": 0.535, "pagerank": { "raw": 4.987098313466533e-07, "percentile": 0.9357624710938746 }, "sha256": "1725d8964f6eb4783fd6d7bf2b35fe6c038a9cfc9b15c0a9ecef6e568b4ffe02", "simhash": "1:2e3f56830c8e8455", "word_count": 5290 }, "last_updated": "2023-07-14T18:23:00.028129+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Justice Sharp joins in this concurring opinion." ], "parties": [ "BORDEN, INC. v. JAMES C. BROWER, T/A HARVEST MILLING COMPANY" ], "opinions": [ { "text": "MOORE, Justice.\nThis appeal poses the sole question: Was defendant\u2019s evidence in support of his defenses and counterclaim admissible?\nPlaintiff\u2019s evidence establishes a prima facie case for an unpaid balance on a promissory note under seal. Plaintiff contends that the material facts set forth in defendant\u2019s answer, deposition, and affidavits offered by defendant in opposition to plaintiff\u2019s motion for summary judgment were inadmissible in evidence because of the parol evidence rule, and that the trial court properly granted plaintiff\u2019s motion for summary judgment.\nAffidavits filed in opposition to a motion for summary judgment \u201cshall set forth such facts as would be admissible in evidence.\u201d G.S. 1A-1, Rule 56(e). If the pleadings, affidavits, and deposition offered by defendant do not set forth facts that would be admissible in evidence because of the parol evidence rule, then such evidence was properly stricken, and since there remained no genuine issue as to any material fact, the court correctly rendered summary judgment for plaintiff. Singleton v. Stewart, 280 N.C. 460, 186 S.E. 2d 400 (1972); Kessing v. Mortgage Corp., 278 N.C. 523, 180 S.E. 2d 823 (1971).\nThe parol evidence rule in North Carolina was stated by Chief Justice Stacy in Insurance Co. v. Morehead, 209 N.C. 174, 183 S.E. 606 (1936), as follows:\n\u201cIt is well-nigh axiomatic that no verbal agreement between the parties to a written contract, made before or at the time of the execution of such contract, is admissible to vary its terms or to contradict its provisions. [Citing numerous cases.] ...\n\u201cOn the other hand, there are a number of seeming exceptions, more apparent than real perhaps, as well established as the rule itself. Roebuck v. Carson, 196 N.C., 672, 146 S.E., 708. ...\u201d\nChief Justice Stacy then sets out eight exceptions to the rule, citing numerous North Carolina cases for each exception. The third exception is that the parol evidence rule is not violated:\n\u201c[B]y showing mode of payment and discharge as contemplated by the parties, other than that specified in the instrument. Bank v. Rosenstein, 207 N.C., 529, 177 S.E., 643; Kindler v. Trust Co., 204 N.C., 198, 167 S.E., 811; Wilson v. Allsbrook, 203 N.C., 498, 166 S.E., 313; Stockton v. Lenoir, 198 N.C., 148, 150 S.E., 886; Bank v. Winslow, 193 N.C., 470, 137 S.E., 320.\u201d\nThe sixth exception is:\n\u201c[B]y showing the whole of a contract, only a part of which is in writing, provided the contract is not. one required by law to be in writing and the unwritten part does not conflict with the written. Dawson v. Wright, supra [208 N.C., 418, 181 S.E., 264]; Henderson v. Forrest, 184 N.C., 230, 114 S.E. 391; Evans v. Freeman, 142 N.C., 61, 54 S.E., 847.\u201d\nTwo excellent law review articles, one by Chadbourn and McCormick entitled \u201cThe Parol Evidence Rule in North Carolina,\u201d 9, N.C.L. Rev. 151 (1931), and a sequel by Dalzell, \u201cTwenty-five Years of Parol Evidence in North Carolina,\u201d 33 N.C.L. Rev. 420 (1955), examine in depth this rule as applied in North Carolina. Chadbourn and McCormick offer the following as a concise and accurate statement of the rule: \u201cAny or all parts of. a transaction prior to or contemporaneous with a writing intended to record them finally are superseded and made legally ineffective by the writing.\u201d 9 N.C.L. Rev. at 152. Professor Stansbury, who is in accord with this statement of the rule, also notes:\n\u201c. . . The execution of the final writing may be termed the' \u2018integration\u2019 of the transaction. By it all prior and contemporaneous negotiations or agreements, whether bral or written, are \u2018merged\u2019 into the writing, which thus becomes the exclusive source of the parties, rights and obligations with respect to the particular transaction or the part thereof intended to be covered by it.\n\u201cThe parol evidence rule applies only to writings which relate to a transaction affecting the legal relations between two or more persons, and which are intended wholly or partly to supersede other negotiations and agreements between them. If such a writing is intended to supersede all other agreements relating to the transaction, it may be termed a total or complete integration; if it supersedes only a part, it is a partial integration. In the latter case, those portions of the transaction which were not intended to be superseded are legally effective and therefore may be shown by parol. ...\u201d 2 Stansbury\u2019s N. C. Evidence, Brandis Rev. \u00a7\u00a7 251-52 (1973).\nAlthough Professor Dalzell in his law review article is somewhat critical of the North Carolina rule as being too liberal, he does state that while some courts emphasize the protection of the written instrument from invasion, the emphasis in North Carolina is rather in the direction of giving the proponent of the oral agreement a chance to prove that it was made if he can, and that by so doing the North Carolina decisions may sometimes come closer, to enforcing the contract that should be enforced than do the more conservative authorities.\nPromissory notes are not' generally subject to the parol evidence rule to the same extent as other contracts. Parties drawing such instruments tend to follow a rather definitely standardized form. If collateral terms and conditions had been agreed upon, they may be omitted from the note itself to insure its negotiability. Accordingly, it is rather common for a promissory note to be intended as only a partial integration of the agreement in pursuance of which it was given, and parol evidence as between the original parties may well be admissible so far as it is not inconsistent with the express terms of the note. See 3 Corbin on Contracts \u00a7 587, at 510 (1960); 2 Stansbury\u2019s N. C. Evidence, Brandis Rev. \u00a7 256 (1973) ; Dalzell, Twenty-five Years of Parol Evidence in North Carolina, 33 N.C.L. Rev. at 432-33 (1955).\nThe North Carolina rule in such cases was stated in Evans v. Freeman, 142 N.C. 61, 54 S.E. 847 (1906)\u2014an often-cited case in which parol evidence was admitted to show that a promissory note was to be paid only to the extent of proceeds received from the sale of patent rights in the maker\u2019s stockfeeder \u2014 as follows:\n. . [The parole evidence rule] applies only when the entire contract has been reduced to writing, for if merely a part has been written, and the other part has been left in parol, it is competent to establish the latter part by oral evidence, provided it does not conflict with what has been written. ... In such a case there is no violation of the familiar and elementary rule we have before mentioned, because in the sense of that rule the written contract is neither contradicted, added to, nor varied; but leaving it in full force and operation as it has been expressed by the parties in the writing, the other part of the contract is permitted to be shown in order to round it out and present it in its completeness, the same as if all of it had been committed to writing.\n\u201cThe competency of such evidence for the purpose of establishing the other and unwritten part of the contract, or even of showing a collateral agreement made contemporaneously with the execution of the writing, has been thoroughly settled by the decisions of this Court. . . . Applying the rule we have laid down, it has been adjudged competent to show by oral evidence a collateral agreement as to how an instrument for the payment of money should in fact be paid, though the instrument is necessarily in writing and the promise it contains is to pay so many dollars. . . .\u201d\nOther promissory note cases involving the North Carolina method of payment and discharge exception to the parol evidence rule include: Carroll v. Brown, 228 N.C. 636, 46 S.E. 2d 715 (1948) (note to be paid out of profits of a partnership in which maker and payee were engaged); Ripple v. Stevenson, 223 N.C. 284, 25 S.E. 2d 836 (1943) (note to be paid out of rents and profits from an office building); Insurance Co. v. Guin, 215 N.C. 92, 1 S.E. 2d 123 (1939) (note to be paid out of commissions); Bank v. Rosenstein, 207 N.C. 529, 177 S.E. 643 (1935) (co-maker\u2019s liability on a note limited to the value of land covered by a deed of trust); Galloway v. Thrash, 207 N.C. 165, 176 S.E. 303 (1934) (note to be paid by crediting it against payee\u2019s anticipated share of maker\u2019s estate); Trust Co. v. Wilder, 206 N.C. 124, 172 S.E. 884 (1934) (note to be paid out of proceeds of land when land was sold); Kindler v. Trust Co., 204 N.C. 198, 167 S.E. 811 (1933) (note to be paid out of collateral held by payee and such payment to be credited to an endorser); Wilson v. Allsbrook, 203 N.C. 498, 166 S.E. 313 (1932) (note to be paid out of rents collected by maker); Stack v. Stack, 202 N.C. 461, 163 S.E. 589 (1932) (note to be paid out of proceeds of land); Bank v. Winslow, 193 N.C. 470, 137 S.E. 320 (1927) (note to be paid out of proceeds from sale of goods); Quin v. Sexton, 125 N.C. 447, 34 S.E. 542 (1899) (note to be paid out of proceeds of another note); Kerchner v. McRae, 80 N.C. 219 (1877) (bond to be credited with the proceeds from sale of cotton). See 12 Am. Jur. 2d, Bills and Notes \u00a7 1264 (1964); 30 Am. Jur. 2d, Evidence \u00a7 1061 (1967); Annot. 71 A.L.R. 548, 570-75 (1931); 2 Stansbury\u2019s N. C. Evidence, Brandis Rev. \u00a7 256 (1973); 3 Strong, N. C. Index 2d, Evidence \u00a732, at 651 (1967).\nIn the present case, according to defendant\u2019s evidence, customers Parrish and Scott executed notes to plaintiff for merchandise sold by plaintiff\u2019s agent to them. At the.request of plaintiff\u2019s agent, a note from defendant to plaintiff included, for bookkeeping purposes only, the amount of these two notes. In no event was defendant to be liable for these amounts. The Parrish and Scott notes were made payable to plaintiff and were never assigned by plaintiff to defendant. Hence, defendant had no legal right to collect from Parrish and Scott.\nThis action is between the original parties to the note. When such an instrument is in the hands of a holder other than a holder in due course, this Court has permitted variance of its express terms by showing that it was to be enforced only on the happening of certain conditions, or only to the extent necessary to accomplish a certain purpose, or that it was payable only out of a certain fund, or that it was given as evidence of an advancement, or that it might be discharged by a method of payment or performance different from that stated in the writing. Insurance Co. v. Morehead, supra, and above cited cases. See also 2 Stansbury\u2019s N. C. Evidence, Brandis Rev. \u00a7 256 (1973); 3 Strong, N. C. Index 2d, Evidence \u00a7 32, at 651 (1967).\nThe Court of Appeals, in affirming the trial court\u2019s exclusion of defendant\u2019s evidence, states that although it is making no attempt to reconcile all prior North Carolina decisions, its decision is consistent with the more recent North Carolina cases on this point. In support of this statement the Court of Appeals cites Bank v. Slaughter, 250 N.C. 355, 108 S.E. 2d 594 (1959), and Vending Co. v. Turner, 267 N.C. 576, 148 S.E. 2d 531 (1966). In Bank v. Slaughter plaintiff bank sought to recover the balance due on a note that had been executed by two individual defendants and a corporation. The controlling interest in the corporation had been purchased by the individual defendants with a portion of the proceeds of the loan from plaintiff bank. At the time of the suit the corporation had been adjudged bankrupt and the individual defendants defended on the ground that, pursuant to an oral agreement with plaintiff, the corporation \u2014 rather than they themselves \u2014 was liable for the balance due on the note. Defendants\u2019 parol evidence concerning this alleged agreement tended to show that prior to the execution of the note, plaintiff agreed that the liability of the two defendants would be limited to that portion of the note that was loaned to defendants individually to purchase the controlling interest of the corporation, and that the corporation alone would be liable for the balance of the loan. This testimony was excluded by the trial court, and this Court affirmed by holding that the promise contained in the note to pay certain amounts \u201ccould not be contradicted or destroyed by parol testimony that the makers would not be called upon to pay monies loaned pursuant to the contract.\u201d 250 N.C. at 357, 108 S.E. 2d at 596.\nProfessor Stansbury, after discussing North Carolina\u2019s various exceptions to the parol evidence rule noted above, cites Bank v. Slaughter for the general proposition that in spite of the liberal approach reflected in many North Carolina parol evidence rule cases, it is not \u201cpermissible to show an agreement that the maker should not be liable in any event.\u201d 2 Stansbury\u2019s N. C. Evidence, Brandis Rev. \u00a7 256, at 252 (1973). Notwithstanding Professor Stansbury\u2019s suggested distinction between this and prior North Carolina cases, we have some difficulty in distinguishing this case from the long line of North Carolina cases holding that a parol agreement as to mode of payment or discharge is competent as between the parties. At least two writers have observed that although the parol evidence rule in this situation has not always been consistently applied in North Carolina, Bank v. Slaughter seems clearly irreconcilable with the rule laid down by this Court in previous cases. Case Law Survey, Inadmissibility of Contemporaneous Parol Agreement to Vary Terms of Loan, 38 N.C.L. Rev. 543 (1960) Case Law Survey, Parol. Evidence Rule, 38 N.C.L. Rev. 540 (1960). Another writer suggests that the case may possibly indicate a retreat from this Court\u2019s previously well-established position. 2 Stansbury\u2019s N. C. Evidence, Brandis Rev. \u00a7 256, at 252, n. 82. Despite any possible conflict, however, we hold that in the instant case North Carolina\u2019s long-established rule admitting parol evidence to show method of payment or discharge is in full force and effect, and Bank v. Slaughter is not controlling.\nNeither is the second case relied on by the Court of Appeals, Vending Co. v. Turner, supra, controlling in the instant case. Vending Co. v. Turner primarily involved the principle that payment or the right to a credit upon a note is an affirmative defense that must be pleaded. Although that opinion does contain a general statement to the effect that a promise set forth in the note could not be contradicted or destroyed by parol testimony, the opinion actually affirmed a judgment that embodies the mode of payment or method of discharge exception to the parol evidence rule. In that case plaintiff sued on defendant\u2019s promissory note. Defendant defended on the ground that at the time his note was made he and plaintiff orally agreed that certain payments received by plaintiff from third parties in the form of \u201cpromotion money\u201d would be credited upon defendant\u2019s note as if paid by defendant. The jury found that this oral agreement collateral to the note itself was made, and consequently that defendant was entitled to credits on the principal amount of the note for the amount of \u201cpromotion money\u201d received by plaintiff. This Court, in an opinion by Justice Lake, affirmed the jury\u2019s findings.\nThe original note in this case given by defendant to plaintiff was renewed from time to time. Defendant offered evidence, which was stricken, that each renewal contained the amounts of the Parrish and Scott notes. If this is true, the renewals did not operate as a discharge of the original note. Plaintiff would be bound by the parol contemporaneous agreement made with defendant through plaintiff\u2019s agent at the time of the original note as to the mode of payment of the liability of defendant. Bank v. Rosenstein, 207 N.C. 529, 177 S.E. 643 (1935); 1 Strong, N. C. Index 2d, Bills and Notes \u00a7 14 (1967).\nApplying the more liberal rule generally followed in cases involving promissory notes and the two well-established North Carolina exceptions to the parol evidence rule as set out by Chief Justice Stacy in Insurance Co. v. Morehead, supra, we hold that as between the original parties to the note in question the evidence offered by defendant was admissible to prove that he and plaintiff through plaintiff\u2019s agent, contemporaneously with the signing of the original note, agreed that defendant was entitled to credit on his own note for the amounts of the Parrish and Scott notes, that in no event would defendant be liable for the payment of the amounts of these notes, that these notes had not been paid, and that the amounts of these notes were included in each renewal note given by defendant to plaintiff, including the note involved in this action. Such evidence is sufficient to raise a genuine issue as to a material fact to be determined at trial. Schoolfield v. Collins, 281 N.C. 604, 189 S.E. 2d 208 (1972).\nFor the reasons stated, the decision of the Court of Appeals is reversed. The cause is remanded to that court with direction to vacate the summary judgment and to remand the cause to the Superior Court for trial in accordance with this opinion.\nReversed and remanded.", "type": "majority", "author": "MOORE, Justice." }, { "text": "Chief Justice Bobbitt\nconcurring in result.\nI agree that the record does not support the entry of summary judgment for plaintiff. However, I do not agree that the cited cases holding that parol evidence is admissible to show an agreement that payment is to be made solely in a specific manner or out of a specific fund constitute authority for holding competent the testimony of Brower and Messersmith. Nor am I prepared to overrule or modify our decision in Bank v. Slaughter, 250 N.C. 355, 108 S.E. 2d 594 (1959).\nHere, more than one writing is involved. The record shows that the Parrish and Scott notes and agricultural security agreements were made to Smith-Douglass, plaintiff\u2019s predecessor; that neither Parrish nor Scott paid any part of these obligations; and that $7,705.94, the amount of the Parrish and Scott notes, was included in the amount of the notes executed from time to time by Brower to plaintiff or its predecessors. The record is silent concerning the efforts, if any, made either by plaintiff or by defendant to collect the Parrish and Scott notes.\nThere was evidence that the Parrish and Scott documents \u201cstayed in [Brower\u2019s] drawer there,\u201d as directed by Messer-smith. Whether plaintiff or Brower now has physical possession of the Parrish and Scott documents seems unimportant. The important point is that indebtedness of $7,705.94 is evidenced both by Brower\u2019s note to plaintiff and by the notes of Parrish and Scott to plaintiff.\nUnder these circumstances, I am of the opinion that the testimony of Brower and of Messersmith was admissible on the ground that it was competent to explain the relationship between the Brower note and the Parrish and Scott notes.\nJustice Sharp joins in this concurring opinion.", "type": "concurrence", "author": "Chief Justice Bobbitt" } ], "attorneys": [ "H. Wade Yates for defendant appellant.", "Leroy, Wells, Shaw, Homthal & Riley by L. P. Hornthal, Jr., for plaintiff appellee." ], "corrections": "", "head_matter": "BORDEN, INC. v. JAMES C. BROWER, T/A HARVEST MILLING COMPANY\nNo. 1\n(Filed 10 October 1973)\nBills and Notes \u00a7 19; Evidence \u00a7 32 \u2014 action on note \u2014 parol evidence rule \u2014 method of payment \u2014 whole contract\nIn an action to recover on a renewal promissory note given by defendant to plaintiff, the parol evidence rule did not prohibit the admission of evidence offered by defendant to prove that two customers executed notes to plaintiff for merchandise sold to them by plaintiff\u2019s agent, that contemporaneously with the signing .of, defendant\u2019s original note defendant and plaintiff\u2019s agent agreed that the note would include the amounts of the customers\u2019 notes for bookkeeping purposes only but that defendant would not be liable for the payment of such amounts, that those notes have not been paid, and that the amounts of those notes were included in each renewal note given by defendant to plaintiff, including the note in question, since .the parol evidence rule is not violated (1) by showing method of payment and discharge contemplated by the parties or (2) by showing the whole of a contract, only a part of which is in writing, when the contract is not required by law to be in writing and the unwritten part does not conflict with the written.\nChief Justice-Bobbitt concurring in result.\nJustice Sharp joins in the concurring opinion.\nOn certiorari to review the decision of the Court' of Appeals, reported in 17 N.C. App. 249, 193 S.E. 2d 751 (.1973), which affirmed summary judgment for plaintiff entered by Cohoon, J., at the \u2022 9 August 1971 Session of Pasquotank Superior Court.\nPlaintiff seeks to recover $7,705.94 with interest,' which plaintiff alleges is due on a negotiable promissory note executed by defendant' on or about 25 July 1969, payable to the order of plaintiff on 1 December 1969. Plaintiff alleges that the note was in the original principal amount of $11,970, and\" that defendant\u2019s payments of principal and interest on the note have left a past due balance of $7,705.94, plus interest at six percent per annum from 25 July 1970.\n. .. Defendant denies that he is indebted to plaintiff alleging among other things that a written agency contract \u2014 dated 16 October 1959 and executed by defendant and by Messersmith for plaintiff under which defendant had been appointed an agent for ; the sale on commission of plaintiff\u2019s fertilizer products\u2014 controlled the business practices and procedures between plaintiff and defendant, and that this agency contract was a bar to defendant\u2019s counterclaim and defenses; that unless authorized by plaintiff and agreed upon by defendant, all sales by Messer-smith to customers in defendant\u2019s sales territory were on or for defendant\u2019s account, with defendant receiving commissions in connection with such sales; that the amounts representing the Parrish and Scott notes were debited by plaintiff to defendant\u2019s account with defendant\u2019s full knowledge and consent and; that defendant had made payment for such amounts in full; that plaintiff\u2019s agent Messersmith was without authority to \u25a0 bind plaintiff to any financial or credit arrangement with defendant not approved by Messersmith\u2019s superiors; and that defendant was aware or should have been aware of such limitation on Messersmith\u2019s authority; and finally that annual settlements between the parties for each of the ten years prior to the execution of the note in suit were a bar to defendant\u2019s counterclaim and defenses. Plaintiff further alleges that annually in July from 1959 to 1969 plaintiff and defendant met for the' purpose of settling their account for the previous fiscal year. On each such occasion plaintiff and defendant examined their account records, determined the credits to which each was entitled, and then agieed upon a balance as the amount owing between the parties for the prior fiscal year, together with any amount unpaid from the previous year\u2019s settlement. At each such settlement, the balance agreed upon was in plaintiff\u2019s favor, and defendant executed under seal and delivered to plaintiff his negotiable promissory note payable to the order of plaintiff in the amount of such balance. Plaintiff further alleges that the Parrish and Scott notes were debited against defendant\u2019s account in at least two such settlements prior to 1969, and that defendant knowingly executed notes to plaintiff encompassing the Parrish and Scott obligations; that defendant had paid plaintiff in full for the Parrish and Scott notes prior to defendant\u2019s execution of the 1969 note involved in this suit, and that, this 1969 note encompassed only new purchases by defendant from plaintiff since the date of the 1968 settlement.\nOn the day plaintiff filed its reply, plaintiff also moved for summary judgment, supporting this motion by portions of defendant\u2019s deposition and by an affidavit of P. J. Scearce, plaintiff\u2019s branch manager. In the portions of defendant\u2019s deposition offered in evidence by plaintiff, defendant admits that he executed the note in suit at the time of the 1969 settlement with plaintiff and that the amount of the note, $11,970, reflected the amount that plaintiff\u2019s records showed defendant owed at that time after striking a balance between them as they had done in the past. The affidavit of Mr. Scearce fully supports plaintiff\u2019s allegations set forth in its reply to defendant\u2019s counterclaim with respect to the annual settlements of plaintiff and defendant from 1959 to 1969, and states that there is a balance of $7,705.94 due on defendant\u2019s note, with interest from 25 July 1970. Additionally, it specifically states that defendant had paid plaintiff in full for the Parrish and Scott notes before the 25 July 1969 note was executed, the Parrish note having been paid on 20 January 1966 and the Scott note on 5 March 1969.\nIn opposition to plaintiff\u2019s motion for summary judgment, defendant offered his verified answer and counterclaim, two affidavits of plaintiff\u2019s agent Messersmith, his own affidavit and portions of his own deposition, and an affidavit of Hassell Hollingsworth, a farmer who had dealt with defendant and Messersmith in the past. The affidavits of Messersmith fully corroborate defendant\u2019s allegations with respect to the details involved in the Parrish and Scott transactions. Messersmith\u2019s affidavit further states that he asked defendant to list the Parrish and Scott notes in defendant\u2019s account with plaintiff \u2014 as an indebtedness by defendant to plaintiff \u2014 for bookkeeping purposes only, with the distinct understanding that defendant would not be personally liable and responsible for such notes, but to the contrary would receive credit for the notes; that plaintiff accepted full responsibility for the collection of these notes which were made payable directly to plaintiff; that these arrangements were well-known and approved by plaintiff\u2019s company officials\u2014 including P. J. Scearce \u2014 and that it was only after Messersmith left the' employment of plaintiff in March of 1969 that any company official raised any objection to Messersmith\u2019s having accepted the Parrish and Scott notes; that defendant signed the settlement notes annually in reliance on his agreement. with Messersmith that defendant would receive .credit without recourse for the Scott and Parrish notes; that Messersmith represented to defendant that as plaintiff\u2019s agent he had authority to accept notes from individual customers; and finally that written agency contracts between plaintiff and defendant were supposed to be executed annually, but that after. 1959 no ' such contracts were executed and instead oral agreements, practice, a,nd procedure determined the parties\u2019 agency relations.\nDefendant\u2019s affidavit states that none of the- settlement notes he gave plaintiff were ever fully paid; that- defendant continued to make purchases from plaintiff and continued to make payments on merchandise he was currently purchasing; that at no- time had defendant \u201cpaid in an amount sufficient to pay for all merchandise purchased currently and to date and including the notes which covered the Parrish and Scott indebtedness\u201d ;. and that the note in suit \u201cexecuted at the time of the 1969 settlement did not cover entirely new purchases of merchandise after the time of the July, 1968 settlement, but rather covered the indebtedness under the Parrish and Scott notes.\u201d\nHollingsworth\u2019s affidavit states that he is a farmer in defendant\u2019s sales area, that Messersmith had extended. credit directly from plaintiff to him and had taken notes from,him payable to plaintiff, and that his own dealings with. Messer-smith had never been questioned or challenged by plaintiff.\nAfter moving for summary judgment, plaintiff moved to strike defendant\u2019s evidenc\u00e9 on the ground that such evidence was irrelevant, immaterial, and inadmissible because of the parol \u00e9vidence rule. The court allowed this motion and entered summary judgment for plaintiff, stating in the judgment that the following facts appeared without genuine .or.substantial controversy: \u201c(1) On or about 25 July 1970, for value .received, defendant executed under seal and.delivered his negotiable promissory note payable to the order of plaintiff in the sum of $11,970, plus interest. ... (2) After giving defendant credits to which he is entitled, the-balance owing on said note is $7,705:94,; plus interest thereon at 6% per annum from 25 July 1970.\u201d The court-concluded \u201cas a matter of law that the material evidence in support of defendant\u2019s counterclaim and defense is inadmissible; that disregarding such evidence, there is no genuine issue as to any material fact and that plaintiff is entitled to summary judgment as a matter of law.\u201d\nFrom the judgment entered, defendant appealed. The Court of Appeals, in an opinion by Judge Parker, affirmed. We allowed certiorari on 6 March 1973.\nH. Wade Yates for defendant appellant.\nLeroy, Wells, Shaw, Homthal & Riley by L. P. Hornthal, Jr., for plaintiff appellee." }, "file_name": "0054-01", "first_page_order": 74, "last_page_order": 87 }