Stallings v. Purvis

257 S.E.2d 664 (1979)

42 N.C. App. 690

Edward Earl STALLINGS v. W. G. PURVIS, Stanley B. Rupy, Charles W. Troutman, J. Franklin Krieger, William F. Beal, Jr. and Edward E. Hollowell, trading as Investment Property Associates and W. G. Purvis, Individually.

No. 7810SC1087.

Court of Appeals of North Carolina.

September 4, 1979.

*666 Tharrington, Smith & Hargrove, by Wade M. Smith, Raleigh, for plaintiff-appellant.

Vaughan S. Winborne, Raleigh, for defendants-appellees.

VAUGHN, Judge.

The central issue of this case is whether plaintiff offered evidence from which the jury might find that the parties entered into a contract in April, 1970 for the lease of the property at 6311 Glenwood Avenue, Raleigh, North Carolina. All three of plaintiff's assignments of error deal with the proof of this matter.

At the close of plaintiff's evidence, which we have set out at some length, the trial court granted defendants' motion for directed verdict pursuant to Rule 50(a) of the Rules of Civil Procedure.

"A motion for a directed verdict pursuant to Rule 50(a) presents the same question *667 as did a motion for nonsuit prior to the adoption of the New Rules of Civil Procedure. The question is whether the evidence presented is sufficient to carry the case to the jury. . . . In passing on this motion, the trial judge must consider the evidence in the light most favorable to the non-movant, and conflicts in the evidence together with inferences which may be drawn from it must be resolved in favor of the non-movant. The motion may be granted only if the evidence is insufficient to justify a verdict for the non-movant as a matter of law." Arnold v. Sharpe, 296 N.C. 533, 537, 251 S.E.2d 452, 455 (1979), citing Kelly v. Harvester Co., 278 N.C. 153, 179 S.E.2d 396 (1971).

Under this standard, we hold that the trial court erred in granting defendants' motions for directed verdict. Enough evidence was presented to permit a jury to find that Purvis as agent for the others and in his own capacity contracted to lease the property.

The essentials of a lease creating an estate for years are (1) the names of the parties (lessor and lessee); (2) a description of the demised realty; (3) a statement of the term of the lease; and (4) the rent or other consideration. A lease is a contract for valuable consideration whereby one agrees to let another have the occupation and profits of realty for a definite period of time. Helicopter Corp. v. Cutter Realty Co., 263 N.C. 139, 139 S.E.2d 362 (1964). The one year lease did not have to be in writing to be enforceable. G.S. 22-2. Taken in a light most favorable to plaintiff as non-movant, the evidence presented by plaintiff would permit the jury to find a lease agreement. The evidence provides the essentials of a lease of particularly described realty, being 6311 Glenwood Avenue, for a term of one year for a monthly rental of $250.00 by plaintiff as lessee from defendant Purvis individually as lessor or all defendants collectively as lessors. The evidence in a light most favorable to plaintiff does indicate that Purvis had capacity to enter into the lease which was made.

It is admitted in the pleadings that the defendant owners were engaged in business as general partners. The acts of Purvis and also of Hollowell as well could, therefore, bind the partnership.

"Every partner is an agent of the partnership for the purpose of its business, and the act of every partner, including the execution in the partnership name of any instrument, for apparently carrying on in the usual way the business of the partnership of which he is a member binds the partnership, unless the partner so acting has in fact no authority to act for the partnership in the particular matter, and the person with whom he is dealing has knowledge of the fact that he has no such authority." G.S. 59-39(a).

The principles of agency law could bind the investors. Principals are liable upon contracts duly made by an agent with a third person "(1) when the agent acts within the scope of his actual authority; (2) when the contract, although unauthorized, has been ratified; (3) when the agent acts within the scope of his apparent authority, unless the third person has notice that the agent is exceeding his actual authority." Investment Properties of Asheville, Inc. v. Allen, 283 N.C. 277, 285-86, 196 S.E.2d 262, 267 (1973).

Under agency law principles, even if the evidence in this case does not show that Purvis acted as an agent within the scope of his actual authority, it tends to show that the other defendants ratified his actions and could therefore be estopped to now deny his authority and that the other defendants held Purvis out to others, including plaintiff, as having apparent authority to lease the realty. Both implied agency authority or agency by estoppel as it is sometimes known and apparent authority theories could be upheld by the facts in evidence and the inferences therefrom at the time plaintiff rested his case. Purvis' phone number was on the for sale sign located on the premises. He was referred to as the "leg man" or "custodian" of the property by Rupy and Hollowell, two of the other five owners. A check made to "W. G. *668 Purvis, Agent" for rent tendered to Hollowell was accepted by Hollowell. This acceptance of rent could constitute a ratification. On his dealings with Purvis and Hollowell directly and Rupy through the realtor, plaintiff was at no time given notice that Purvis did not have the power he claimed to have to deal with the property. No one objected to plaintiff going into possession and making major renovations.

Purvis individually could have made a lease for one year. His statements to plaintiff in front of others seem to indicate he could. One does not have to be the fee owner to make a lease. See Webster, Real Estate Law in North Carolina, § 206 (1971). Although the present case, as well as others at the directed verdict stage, presents thorny problems (see e. g. Investment Properties of Asheville, Inc. v. Allen, 13 N.C.App. 406, 185 S.E.2d 711, aff'd, 281 N.C. 174, 188 S.E.2d 441 (1972), reversed on rehearing, 283 N.C. 277, 196 S.E.2d 262 (1973)), we hold plaintiff's evidence sufficient to take the case to the jury.

The trial court on defendants' motions struck two of plaintiff's responses on direct examination concerning his 25 March meeting with Purvis. Plaintiff testified, "It was my understanding that we had an agreement," and "Well, we may have discussed some of the lease agreements again, I don't know, I don't recall exactly, but I felt the lease was secure." These statements were obviously incompetent, and the trial court's action striking them from evidence was proper.

Plaintiff produced a witness who would have testified, if permitted, that she talked with Mr. Purvis in late 1969 about leasing the property at 6311 Glenwood Avenue and that "he told me he had bought out the other partners and that he had paid $45,000.00 for the property." The trial court sustained defendants' objection to this evidence. Plaintiff contends this evidence was not hearsay or, if so, was admissible to corroborate the plaintiff's testimony that Purvis told him he was owner or custodian of the property. Defendants make some sort of argument that this information lacks logical relevance. We hold that it was logically and legally relevant. For the purpose plaintiff seeks to use it, it is admissible. It does not prove the truth of the matter asserted that Purvis owned the land but instead corroborates the plaintiff's testimony that Purvis told him he was in control. It was not hearsay and, if offered at the next trial, should be admitted. Keller v. Furniture Co., 199 N.C. 413, 154 S.E. 674 (1930). 1 Stansbury, N.C. Evidence, § 141 (Brandis rev. 1973).

The judgment is reversed and the case is remanded.

Reversed and remanded.

HEDRICK and ARNOLD, JJ., concur.