Wells v. Foreman

Annotate this Case

72 S.E.2d 765 (1952)

236 N.C. 351

WELLS et al. v. FOREMAN.

No. 318.

Supreme Court of North Carolina.

October 29, 1952.

*766 Sam B. Underwood, Jr., Greenville, for defendant-appellant.

Blount & Taft, Greenville, for plaintiff-appellees.

BARNHILL, Justice.

The motion of defendant rests upon the assumption that the plaintiffs seek to enforce an oral agreement to devise or convey real property. She insists that, as it appears on the face of the complaint the alleged agreement was not in writing, evidence in support thereof is inadmissible and on a motion to strike admissibility of evidence in support of the allegation sought to be stricken is the test of relevancy. Weant v. McCanless, 235 N.C. 384, 70 S.E.2d 196, 198.

Even so, her position in this respect is untenable. As said by Denny, J., in Weant v. McCanless, supra: "It is settled in this jurisdiction that the provisions of the statute of frauds cannot be taken advantage of by demurrer. * * * Neither can such defense be taken advantage of by motion to strike." (See cases cited.)

Evidence of a parol agreement to convey real property is admissible unless the defendant asserts the unenforceability of the contract by reason of the statute of *767 frauds. And such defense can be raised only by answer or reply. Weant v. McCanless, supra, and cases cited.

But apparently defendant misconceives the nature of plaintiffs' cause of action. They do not seek to enforce an oral contract to devise or convey real property. They seek to recover money expended to the use and for the benefit of the defendant.

Ordinarily, in the absence of fraud or mistake, money voluntarily expended or a payment voluntarily made to the use of another is not recoverable. Rhyne v. Sheppard, 224 N.C. 734, 32 S.E.2d 316; Boyles v. Prudential Insurance Co., 209 N.C. 556, 183 S.E. 721; Guerry v. American Trust Co., 234 N.C. 644, 68 S.E.2d 272; 40 A.J. 820. To support a recovery of funds expended to the use of another, it must be made to appear that the beneficiary promised to repay the money so expended, or by his conduct induced the payer to make the expenditure, or consciously received what did not belong to him. 40 A.J. 820.

When a party to a special contract, unenforceable by reason of the statute of frauds, expends money as contemplated by the contract, and the other party to the contract consciously receives or accepts the benefits thereof and then fails or refuses to perform his part of the special contract, the law implies a promise and obligation to repay the money so expended. Rhyne v. Sheppard, supra; Whetstine v. Wilson, 104 N.C. 385, 10 S.E. 471; Dupree v. Moore, 227 N.C. 626, 44 S.E.2d 37; Stewart v. Wyrick, 228 N.C. 429, 45 S.E.2d 764; Hawkins v. Town of Dallas, 229 N.C. 561, 50 S.E.2d 561; Ebert v. Disher, 216 N.C. 36, 3 S.E.2d 301; Anno. 69 A.L.R. 14 (95). This obligation or implied promise may be enforced in an action in assumpsit for money had and received or under the doctrine of unjust enrichment. Rhyne v. Sheppard, supra; Harrington v. Lowrie, 215 N.C. 706, 2 S.E.2d 872.

"The contract being unenforceable under the Statute of Frauds, no recovery can be had upon it; no damages can be recovered on account of its breach for the same reason; and upon the same principle, the contract being unenforceable, the value of plaintiff's services cannot be concluded by its terms. Faircloth v. Kenlaw, 165 N.C. 228, 81 S.E. 299. In place of the unenforceable promise to devise real estate in consideration of services to be performed, the law substitutes the valid promise to pay their reasonable worth. Annotation 69 A.L.R. 95. The mainspring of the Statute of Frauds is to prevent frauds not to promote them." Stacy, C. J., in Stewart v. Wyrick, supra [228 N.C. 429, 45 S.E.2d 766].

Thus it was necessary for plaintiffs to plead the special contract and defendant's breach thereof as a basis for the recovery of the money expended in reliance thereon. This includes the allegation of the essential facts and circumstances which (1) prompted the parties to enter into the contract; (2) induced the plaintiffs to make the payments on the mortgage indebtedness and expend the money in the repair and improvement of the premises; (3) disclose the conscious acceptance by defendant of the benefits thereof; and (4) constitute a breach of the special contract by defendant.

Such allegations are not made by way of reliance on the terms of the contract but to rebut any presumption that the expenditures were gratuitous. Barron v. Cain, 216 N.C. 282, 4 S.E.2d 618; Rhodes v. Jones, 232 N.C. 547, 61 S.E.2d 725; Neal v. Wachovia Bank & Trust Co., 224 N.C. 103, 29 S.E.2d 206; Rochlin v. P. S. West Construction Co., 234 N.C. 443, 67 S.E.2d 464.

The facts alleged in the complaint are essential to plaintiffs' cause of action. They are stated without any undue prolixity. Hence the court below properly denied the motion to strike.