Culler v. Watts

313 S.E.2d 917 (1984)

Ethel B. CULLER v. Maurice WATTS.

No. 8221DC1362.

Court of Appeals of North Carolina.

April 17, 1984.

*918 Sparrow & Bedsworth by W. Warren Sparrow and George A. Bedsworth, Winston-Salem, for defendant-appellant.

Hutchins, Tyndall, Doughton & Moore by Thomas W. Moore, Jr., Winston-Salem, for plaintiff-appellee.

JOHNSON, Judge.

Defendant proceeded on the theory that by accepting rental payments for a period of eighteen months following expiration of the original lease term, plaintiff and her husband, and hence plaintiff, waived any right they otherwise had to require written notice of renewal. Defendant bore the burden of proving that plaintiff had waived the breach, i.e., the failure to give notice of renewal. Wachovia Bank v. Rubish, 306 N.C. 417, 293 S.E.2d 749, reh'g denied, 306 N.C. 753, 302 S.E.2d 884 (1982). To survive a motion for directed verdict, absent evidence of additional consideration to support the waiver, defendant had to offer evidence of four elements. Id. *919 First, that the waiving party, here plaintiff, was the non-breaching party. It is undisputed that prior to giving defendant notice of termination plaintiff had performed her obligations under the contract. Second, that the breach did not involve total repudiation of the lease, so that the innocent party continued to receive some of the bargained-for consideration. Defendant attempted to introduce rent checks signed by the deceased, but these were excluded under the "dead man's statute," G.S. 8-51. Third, that the innocent party was aware of the breach. Plaintiff admitted that she was aware of defendant's operations on her land; the notice of termination, and her trial testimony, clearly indicate that plaintiff was aware of the lease and its terms. Fourth, that the innocent party intentionally waived her right to repudiate by continuing to accept the partial performance of the breaching party. Acceptance by the lessor of rent which the lease provides shall be paid during the extended term is considered such a waiver, nothing else appearing. Wachovia Bank v. Rubish, supra; Trust Co. v. Frazelle, 226 N.C. 724, 40 S.E.2d 367 (1946). No evidence was introduced contradicting intent to waive during the period the checks were allegedly received and negotiated by the deceased. Therefore, the excluded checks would have been sufficient evidence to satisfy this fourth element, since a covenant to renew is not personal, but runs with the land and is binding on the legal successors of the lessor, in this case plaintiff as the survivor of the entireties estate. Trust Co. v. Frazelle, supra; see also Nolan v. Nolan, 45 N.C.App. 163, 262 S.E.2d 719 (1980) (option to purchase runs with land); J. Webster, Real Estate Law in North Carolina §§ 247, 251 (Hetrick rev. ed. 1981).

It is clear then, that if the court's ruling excluding the checks was proper, defendant failed to present evidence on all the elements of waiver as required by Wachovia Bank v. Rubish, supra. The directed verdict for plaintiff would therefore be entirely proper. G.S. 8-51, the "dead man's statute," operates to exclude evidence of the acts or statements of deceased persons, since those persons are not available to respond. See generally 1 H. Brandis, N.C.Evidence §§ 66-67 (1982). The statute provides in relevant part:

Upon the trial of an action, or the hearing upon the merits of a special proceeding, a party or a person interested in the event, or a person from, through or under whom such a party or interested person derives his interest or title by assignment or otherwise, shall not be examined as a witness in his own behalf or interest, or in behalf of the party succeeding to his title or interest, against the executor, administrator or survivor of a deceased person, or the committee of a lunatic, or a person deriving his title or interest from, through or under a deceased person or lunatic, by assignment of otherwise, concerning a personal transaction or communication between the witness and the deceased person or lunatic ....

Defendant called plaintiff's son as a witness and established that the son could identify his father's, the deceased's, signature. Defendant then attempted to have the son identify the deceased's signature on the back of certain checks. The court sustained plaintiff's objection; thereby it committed prejudicial error. Although the statute prevented the son from testifying that he saw the deceased negotiate the checks, it is well established that it did not make him incompetent to testify to the handwriting on the checks. Waddell v. Carson, 245 N.C. 669, 97 S.E.2d 222 (1957); Batten v. Aycock, 224 N.C. 225, 29 S.E.2d 739 (1944). The son testified for the record that the handwriting was in fact his father's. Such evidence, if admitted, would have been sufficient to authenticate prima facie the deceased's signature on the checks; defendant then could have taken the stand to identify and authenticate the contents of the checks. Thus, the erroneous ruling prevented defendant from establishing prima facie all four elements of waiver and thereby surviving the motion *920 for directed verdict. Defendant has met his burden of showing prejudicial error, and there must accordingly be a new trial.

Since the matter will undoubtedly arise on retrial, we note that the court's other ruling under G.S. 8-51, barring evidence of what the deceased said he was going to do, was entirely proper.

Reversed.

ARNOLD and PHILLIPS, JJ., concur.