Action for Possession of Personal Property — Competency of Witness — Chattel Mortgage — Mortgagee as Subscribing Witness — Execution by Corporation — Validity of Mortgage.
1. Where he is not excluded under the provisions of section 590 of The Code, the mortgagee in a chattel mortgage is competent, as a subscribing witness thereto, to prove its execution for admission to probate, inasmuch as sec. 1351 of The Code removes the disqualification formerly attaching to witnesses having an interest.
2. The common seal of a corporation being affixed to an instrument is prima facie evidence that it was affixed by competent authority, and hence it is not incumbent upon one claiming personal property under a mortgage by a corporation to show that its execution was duly authorized.
3. In the trial of an action for possession of personal property claimed under a chattel mortgage executed by a corporation, it is competent for the adverse party to go behind the seal and show that it was not affixed by the legally exercised authority of the company.
4. A chattel mortgage recited that a corporation was indebted to the mortgagee, "for which he holds my note," and to secure the same "I do" convey to him certain property owned by the corporation, and "if I fail" to pay the debt, the mortgagee may sell, allowing an attorney fee to be charged to "me"; the attestation was "witness my hand and seal." The mortgage was signed by the "president" of the corporation as "president" with his private seal, and by others as "treasurer" and "stockholder," and the corporate seal was set opposite to their names: Held, that such mortgage was a conveyance by the president personally and not one by the corporation acting through him.
5. Where the property described in a chattel mortgage which purported to be the act of the corporation but was only that of an officer personally, belonged to the corporation and was in the adverse possession of the defendant at the time of the execution of the mortgage, the instrument was properly excluded as evidence in an action for the possession of the property by the mortgagee.
(762)
CLARK, J.
It was not a sufficient objection to the introduction of the mortgage that the subscribing witness thereto, by whom its execution was proved when admitted to probate, was the mortgagee therein. The Code, sec. 1351, removes the disqualification attaching formerly to witnesses having an interest. The mortgagee in this case, not coming within any of the exceptions (Code, sec. 590; Bunn v. Todd, 107 N.C. 266), was competent as subscribing witness to prove (765) the execution of the mortgage to himself, but such practice is not commended nor to be encouraged, for the probate is ex parte without opportunity for cross examination.
Nor was it incumbent upon the party offering the mortgage to show that its execution was duly authorized. The common seal being affixed is prima facie evidence that it was affixed by proper authority. 1 Devlin Deeds, sec. 341. It was competent for the opposite party to go behind the seal and show that it was not affixed by the legally exercised authority of the company. Duke v. Markham, 105 N.C. 131, 136. But the instrument on its face is not the mortgage of the corporation. It recites that the corporation (naming it) is indebted to the plaintiff "for which he holds my note to secure the payment of the same, I do hereby convey to him the following articles of personal property, to-wit: now in the Hodge Hotel belonging to the said company, and if I fail to pay said debt by 13 April, 1892" (then follows power of sale with provision for allowance of ten per cent to attorney for collection) "charging said fee to me, and after paying said debt, interest, costs and fee, the surplus to be paid over to said Clark" (the mortgagee). "Witness my hand and seal, this 13 April, 1892." To this, D. N. Hitchcock affixes his signature as "president," adding his private seal. Two others signed respectively "treasurer" and "stockholder," the seal of the corporation being set opposite to the three names. Laws 1891, ch. 118 (since repealed and reenacted with some modification by the Act of 1893, ch. 95), is like The Code, sec. 685, an enabling act, additional to and not exclusive of the common law mode of executing deeds. Bason v. Mining Co., 90 N.C. 417. This instrument might possibly therefore be (766) admitted as executed in behalf of the corporation so far as the common seal and the signing of the officers are concerned, but from the attestation clause, the body of the deed and the conveying words, it is clear that it is the conveyance of D. N. Hitchcock and not that of the corporation acting through him. It is the personal act and deed of its president. Clayton v. Cagle, 97 N.C. 300; Davidson v. Alexander, 84 N.C. 621; Insurance Co. v. Hicks, 48 N.C. 58; Plemmons v. Improvement Co., 108 N.C. 614. It is admitted that the property embraced in the description was at the time of the execution of the mortgage the property of the corporation (not of said Hitchcock) and was in the adverse possession of the defendant. The mortgage offered was therefore properly excluded.
No Error.
Cited: Bernhardt v. Brown, 122 N.C. 591; LeRoy v. Jacobosky, 136 N.C. 458; Edwards v. Supply Co., 150 N.C. 175; Power Corp. v. Power Co., 168 N.C. 221.