At May term, 1894, when the case was called for hearing, the defendant made the following motions: "That the action be dismissed, for that the complaint and evidence in the case disclose that all the drafts and accounts herein declared on were drawn on claims, or an interest in claims, against the United States, before their allowance, and are therefore null and void under the statutes of the United States. The defendant further moves that the action be dismissed, because the referee does not find that any sums of money have been paid to the defendant." The motions were overruled, and the defendant excepted. The court then proceeded to consider the case on the report and exceptions. The exceptions were not sustained, the findings of the referee were adopted and confirmed, and the following judgment was rendered: ment of the United States the sum of $460.76 on claims due him for services of J. T. Patterson, Jr., performed prior to the acceptance of his said draft, and the aforesaid sum of $460.76 was not subject to any previous order or money advanced by the defendant to J. T. Patterson, Jr., and that the same was placed to his credit and control since the acceptance of said draft. (6) That said defendant, Douglas, has had placed to his credit and control in the treasury department in Washington, D. C., the sum of $2,274.55, due him for service of W. J. Patterson rendered prior to the acceptance of the aforesaid draft for $325, and that the same was not subject to any previous draft or moneys advanced by the defendant to the said W. J. Patterson, except a draft for $100 and one for $500; and that the aforesaid sum of $2,274.55 was placed to the credit and control of the defendant since the acceptance of said draft. (7) That the amount of the claim which S. P. Graham traded to the plaintiffs on the 25th day of October, 1881, was $98.82 for services rendered by said Graham as deputy marshal to the defendant, and sworn to before J. C. Anderson, United States commissioner, on the 20th day of October, 1881, and that the same was presented to defendant by the plaintiffs, which he agreed to pay; and of the aforesaid claim $95.62 has been placed to the credit and control of the defendant in the treasury department at Washington, D C., since the acceptance of said claim by defendant, the remainder of said claim having been allowed by the government. That the voucher so traded to the plaintiffs was for services rendered prior to said acceptance and before the same was transferred to the plaintiffs. And the further sum of $2,858.76 was placed to the defendant's credit and control in the treasury department for services rendered by said Graham, and out of that sum the defendant has received $900, leaving $1,958.76 to the credit of the defendant since said acceptance. (8) The referee finds as a further fact that the aforesaid amounts, when added together, make a sum total of $620.62. From the foregoing facts I find the following conclusions of law: (1) That the amounts of money placed to the credit and control of the defendant in the treasury depart-ther considered that the plaintiffs recover of ment at Washington, D. C., as found above, and which are largely in excess of the plaintiffs' claims, are subject to the payment of the drafts sued on to the full amount of the same, with interest thereon at 6 per cent. from the 17th day of July, 1885, at which time this action began, till the 7th day of August, 1893, which amount to $318.55; added to the principal, make a sum total of $939.17, which I find as a conclusion of law that the plaintiffs are entitled to judgment against the defendant, and for costs of action. All of which, together with the evidence introduced by both parties, and the rulings as to the competency of evidence, is respectfully submitted this 7th day of August, 1893." "This action coming on for hearing before Bynum, J., at May term, 1894, of Iredell su perior court, upon the report of H. Bingham, Esq., and exceptions thereto, and the decision of the supreme court, passing upon the judgment of Whitaker, J., heretofore rendered at November term, 1893, of this court, the defendant's exceptions 4, 6, 7, 9, and 12, not heretofore passed upon, are overruled, and the opinion of the supreme court overruling exceptions 1, 2, 3, and 11 is hereby adopted. The court adopts the findings of the referee upon his findings of fact, holding as matter of law the records A, B, and C. A being admitted by the supreme court as competent testimony, was sufficient to sustain the findings of fact by the referee in his findings 5, 6, 7, and 8, when plaintiffs moved for judg ment against defendant because of his negligence in not collecting said sums due him as marshal for services of plaintiffs' assignors, which the referee finds had been allowed defendant, and placed to his credit and control, which motion was allowed by the court; whereupon, upon motion of plaintiffs' counsel, Messrs. Armfield and Turner, it is considered and adjudged by the court that the plaintiffs Wallace Bros. recover of the defendant R. M. Douglas the sum of $961.50 with interest on $620 at six per cent. per annum from May 21, 1894, till paid. It is fur the defendant their costs of this action, to be taxed by the clerk of this court, except the sum of one hundred dollars allowed to H. Bingham, Esq., for taking and stating the account in this case, which is to be divided, the plaintiffs paying $50 and the defendant paying $50 thereof, as heretofore adjudged." To the judgment the defendant excepted. for the reason, as he alleges, that it shows that no funds had been received by the defendant to the use of J. T. Patterson, Jr., W. J. Patterson, or on the account of S. P. Graham, and that, therefore, the plaintiffs are not entitled to any judgment on the claim. He also excepts to the judgment on the ground "that plaintiffs cannot maintain the action and make any recovery against defendant, for the reason that the alleged causes of action are unlawful, for that the drafts and account declared on are based upon and assign an interest in claims against the United States before the allowance of the claim by the treasury department of the United States in violation of section 3477, Rev. St. U. S." His honor properly refused to dismiss the action for the first cause assigned therefor. The matter of the compensation of the deputy marshals of the defendant is between them and the marshal, and not between them and the government, and therefore the assignment of their claims for compensation against the marshal is not in violation of section 3477 of the Revised Statutes of the United States. Wallace v. Douglas, 103 N. C. 19, 9 S. E. 453. The second cause assigned for the dismissal of the action was properly refused. It was not necessary for the defendant to have received the manual possession of the money which had been placed to his credit and under his control in the treasury department at Washington for the services of his deputies, to fix him with liability on the acceptances which he had made for them. For whatever reason the defendant had failed or refused to make his settlement with the government, his deputies had no concern. Their compensation, though due to them by the defendant, was audited and passed upon by the proper government officials, and put to the credit and under the control of the defendant; and, upon that having been done, there was a receiving by the defendant of the funds. So far as he and his deputies were concerned, the defendant became liable to them, and, as a consequence, to their assignees, the plaintiffs. The exceptions to the judgment cover the same grounds as do the motions to dismiss, and they are not sustained here. There is no error in the judgment, even if it be conceded that the court, in rendering it, gave a wrong reason therefor. error. No FURCHES, J., having been of counsel, did not sit on the hearing of this case. UNITED STATES NAT. BANK OF NEW YORK v. MCNAIR. (Supreme Court of North Carolina. April 2, 1895.) BILLS AND NOTES-ACTION BY INDORSEE-SET OFF. 1. A purchaser of several notes for value and before maturity, without notice of any setoffs, who pays one half of their aggregate face value, and gives the indorsee credit for the balance, subject to his check, holds all the notes free from any right of set-off in favor of the maker as to any remaining unpaid, and the fact that he may have recovered on part of the notes does not deprive him of the character of a purchaser for value, so as to let in the right of setoff as to the others. 2. That an indorsee who rediscounts notes may have paid less than their face value for them does not entitle the maker to any right of set-off to which he would not otherwise be entitled. Appeal from superior court, New Hanover county; Brown, Judge. Action by the United States National Bank of New York against S. P. McNair on a promissory note. From a judgment for plaintiff, defendant appeals. Affirmed. The following is the statement on appeal: The following issues were submitted to the jury: "(1) Is the defendant indebted to the plaintiff? And, if so, in what sum? (2) Is the note sued on in this action subject to the set-off pleaded in the answer?" The plaintiff offered in evidence a note for the sum of $2,500 dated 21st November, 1891, and due 30 days after date, executed by the defendant to the First National Bank of Wilmington, N. C., indorsed to the plaintiff by said First National Bank before maturity. The defendant denied that the plaintiff was a purchaser for value of the said note. The defendant introduced as witness in his behalf Asa Walker, who testified as follows: "I was corresponding clerk of the First National Bank before its failure. Our correspondent in New York was the plaintiff. The First National Bank repeatedly sent the plaintiff notes for rediscount. The note sued on was indorsed to the plaintiff, and sent on for rediscount, with a batch of other notes aggregating $17,000 on the 21st day of November, 1891. These notes were all discounted by the plaintiff, and reported in the account current furnished us by the plaintiff under date of 23d of November, 1891." The notes so sent are described in a letter from the plaintiff to the First National Bank dated 23d November, 1891, and marked "Exhibit A." (Said letter put in evidence.) The account current furnished to the First National Bank by the plaintiff for the month of November, 1891, marked "Exhibit B" is also put in evidence by the defendant. Telegram dated 25th November, 1891, signed H. M. Bowden, to the plaintiff, was also put in evidence, marked "Exhibit C." Also telegram from the defendant to the plaintiff, dated 27th November, 1891, marked "Exhibit D," was also put in evidence, the said telegram being a night message. S. P. McNair testified as follows: "When the First National Bank failed, on the 25th day of November, 1891, I had on deposit in said bank, subject to check, $2,683.01." J. G. Boney was also called as a witness by the defendant, and the defendant offered to prove by this witness that a note of Boney & Harper's, for the sum of $5,000, was one of the notes in the batch of notes for $17,000, indorsed by the First National Bank to the plaintiff at the same time with the note in suit, and which was sent on to the plaintiff on the 21st November, 1891, for rediscount, and was discounted; that suit had been brought thereon by the plaintiff, and since suit had been brought they had paid thereon into court, for the use of the plain tiff, the sum of $1,900. This evidence was excluded by the court upon the plaintiff's objection, and the defendant excepted. This was offered as tending to show that the plaintiff had received back a part of the money which it had paid out on these notes and is not a purchaser for value. The defendant offered to prove that there was a note of Morris Bear & Bro. for $2,000 also rediscounted in the same batch of notes of 23d November, 1891; that said note was sent out for suit, and suit brought, and it was paid. This evidence was also excluded, and the defendant excepted. The court instructed the jury that they should answer the first issue, "$2,500, with interest at the rate of 8 per cent. per annum from the 24th day of December, 1891, till paid," and answer the second issue, "No." The jury having returned their verdict in accordance with his honor's instructions, judgment was rendered as stated in the record. The defendant moved for a new trial, and assigned the following errors: "(1) For that his honor excluded all the evidence tending to show that the plaintiff had received back part of the money it had actually paid out on the discount of the notes, and was not a purchaser for value. (Motion overruled. Appeal.) The defendant assigned as error on appeal the excluding by the court of all the testimony tending to show that the plaintiff had received back a part of the money which it had actually paid out on the batch of notes referred to, and was not a purchaser for value." EXHIBIT A. "First National Bank of Wilmington. "New York, 23d November, 1891. "Wm. S. O'B. Robinson, Receiver. H. M. B. &c., Wilmington, N. C.: We have this day discounted the following notes contained in your favor of the 21st inst., and proceeds of same placed to your credit, as follows: Boney & Harper, due 12th Dec. '91.... McNair & Pearsall, due 22d Dec. '91..... M. Bear & Bro., due 24th Dec. '91.. S. P. McNair, due 24th Dec. '91. B. F. Mitchell & Son, due 23d Dec. '91 Amount of notes....... Less discount at 6 per cent.. Proceeds $5,000 $15 83 5.000 24 17 2.000 10 33 2.500 12 92 2,500 25 42 $17,000 88.67 $16,011 33 "John J. McAuliffe." George Rountree, for appellant. S. C. Weill and Shepherd & Busbee, for appellee. CLARK, J. The familiar general rule is that an indorsee of negotiable paper for value before maturity, without notice of any infirmity, takes it clear of all equities and defenses between antecedent parties, and is, of course, entitled to recover the full amount of the same, according to its tenor. The exceptions to this rule are: (1) When by statute the paper is void in whole or in part from its inception, as for usury. In such cases it is void to the same extent into whosesoever hands it may pass, even if acquired before maturity, for value and without notice, and the sole remedy of the hold er for the deficiency is against the indorser. Ward v. Sugg, 113 N. C. 489, 18 S. E. 717, and cases there cited. (2) Where the original consideration of the paper is illegal or fraudulent, or it is taken as collateral security, the right of recovery is restricted to the consideration actually paid by the indorsee before notice of the fraud (Dresser v. Construction Co., 93 U. S. 92), or the amount of the debt to which it is collateral. Kerr v. Cowen, 17 N. C. 356. But the exception does not extend further, not even to cases where the note was issued without any consideration, though it may be purchased by the indorsee for less than its face. Daniels v. Wilson, 21 Minn. 530. These propositions are also sustained (among a wealth of authorities) by 1 Daniel, Neg. Inst. (4th Ed.) §§ 758, 758b; Allaire v. Hartshorne, 21 N. J. Law, 665; Stalker v. McDonald, 6 Hill, 93; Edwards v. Jones, 7 Car. & P. 633; Williams v. Huntington (Md.) 13 Atl. 336; Cromwell v. County of Sac, 96 U. S. 51; Hubbard v. Chapin. 2 Allen, 328. Still less does the exception extend to a case like the present, in which there was neither fraud nor illegality, and where the note was executed for full consideration, and indorsed to the plaintiff before maturity without notice of set-off, and upon payment of half the purchase money, credit for the balance being entered on the books, subject to check by the indorser. so extend the exception would not only be without precedent, but would impair the freedom of transfer and negotiability which is the distinctive feature of commercial paper, by means of which so large a part of the business of the world is transacted. Could the maker, after rediscount of this paper, by notifying the indorsee that he held a set-off against his note, have prevented the indorser from having its checks for the unpaid balance paid by the indorsee? And wherein does the indorser's insolvency extend the maker's rights in this regard? Has not the receiver the same right to check out this balance that the indorser would have had, if it had remained solvent? But where there is fraud it is different, and the indorsee could not have paid the indorser's check for the balance after notice. Indeed. the same contention as in this case was presented and passed on in Bank v. McNair, 114 N. C. 335, 19 S. E. 361, which concernel this same transaction, and is between the same plaintiff and one of the defendants in that action. Το There were five notes, aggregating $17,000, indorsed at the same time by the First National Bank of Wilmington to the plaintiff and rediscounted by it. In the trial of this action, which is brought on one of said notes, the defendant offered evidence to show that the plaintiff had recovered on two others of this batch of notes $3,900, "as tending to show that the plaintiff had recovered back a part of the money which it had paid out on these notes, and is not a purchaser for value." As the plaintiff paid $8,102 in cash on the purchase of said notes, besides giving the credit for the balance (after deducting discount), the evidence would not, in any view, have shown that the plaintiff was not still a purchaser for value. If there is part payment, the title to the paper passes to the purchaser, when there is no fraud, while if there is fraud it does not, and the indorsee is only entitled in equity to the payments he has made before notice of the fraud. The plaintiff has a right, as such purchaser, to collect in full all five of the notes, in which event it will owe the First National Bank the $8,808 placed to its credit by reason of the balance due on the purchase of said five notes, but, should there be a deficiency in collecting the full amount of all of the notes, the plaintiff might offset such deficiency upon the $8,808 to the credit of the Wilmington bank; for, by the maturity of the notes without payment, the plaintiff holds a liability against the First National Bank of Wilmington for $17,000 and interest. The $8,102 in cash and the credit of $8,808 were on no particular note, but on the rediscount value of all five. There is no principle of law that the collection of the notes the plaintiff may be persuaded to sue on first will exonerate the other notes, and enable the makers of the other notes thereupon to plead against the indorsee any setoffs they may have against the payee. Such rule will make the rights of parties depend, not upon the equal and impartial application of the principles of law to all five notes, but upon the election of the indorsee as to which notes he will be pleased to exhaust first. The plaintiff holds all the notes without liability for set-offs, and any surplus it may collect over and above the cash paid the Wilmington bank, discount and interest added, will go to the First National Bank of Wilmington, to be disbursed in the settlement of its liabilities. The unpaid purchase money is due the indorser, and not the makers of the note. As to such unpaid balance, there is the right of set-off as between the indorsee and indorser, but not between the indorsee and maker, unless the note is void, illegal, or fraudulent. The hardship of the defendant in this case, in not obtaining his set-off, is no greater than in any other case where a note (as to which there is no fraud or illegality) is assigned before maturity and for value and without notice, though the maker holds set-offs against it. It can make no possible difference to the maker whether the indorsee paid full value or less, or whether the payment was all cash or partly credit. If the note is not void, illegal, or fraudulent, the indorsee who takes it for value, before maturity, and without notice, gets the title free from all equities, no matter how much he pays. On the other hand, though he pays full value in cash, he would still be liable to equities if he did not take before maturity, for value, and without notice. These are the three requirements to protect the holder of negotiable paper, and there is no precedent or reason to add as a fourth that the amount must be paid in cash, to the full amount agreed to be paid. No error. LEAVELL v. WESTERN UNION TEL. CO. (Supreme Court of North Carolina.. April 2, 1895.) TELEGRAPH COMPANIES-ILLEGAL RATES-ILLEGAL DISCRIMINATION. 1. Where a telegraph company has a continuous line between two points in the state, it cannot defend an action for violation of the rate prescribed by the commissioners for the transmission of a message sent over the lines of one company, on the ground that the message was in fact sent over the lines of two companies. Railroad Com'rs v. W. U. Tel. Co., 18 S. E. 389. 113 N. C. 213, affirmed. 2. Nor is it any defense that the part of the defendant's line between the points where the message was sent by the other company was fully occupied by the work it had contracted to do for a railroad company, as the contract with the railroad, giving it a preference to the exclusion of others, is an illegal discrimination. Appeal from board of railroad commission. Action upon relation of R. E. Leavell against the Western Union Telegraph Company for violation of the rate prescribed by the railroad commission of North Carolina From a judgment of the railroad commis sion against the defendant, defendant appeals. Affirmed. Robert Stiles, for appellant. The Attorney General, for appellee. CLARK, J. In Atlantic Exp. Co. v. Wilmington & W. R. Co., 111 N. C. 463, 16 S. E. 393, this court affirmed the constitutionality of the act (chapter 320, Acts 1891) establishing the railroad and telegraph commission. In Mayo v. Telegraph Co., 112 N. C. 343, 16 S. E. 1006, it sustained the power of such commission, under section 26 of said act, to establish rates for telegraph companies. In Railroad Com'rs v. Western Union Tel. Co. (Albea's Case) 113 N. C. 213, 18 S. E. 389, the court held that telegraphic messages transmitted by a company from and to points in this state, although traversing another state in the route, do not constitute interstate commerce, and are subject to the tariff regulation of the commission. In this it followed the unanimous opinion of the supreme court of the United States, delivered by Fuller, C. J., in Lehigh Valley R. Co. v. Pennsylvania, 145 U. S. 192, 12 Sup. Ct. 806. To the same purport, Campbell v. Railroad Co., 86 Iowa, 587, 53 N. W. 351. In the present case the commission find as a fact that "the defendant has a continuous line by which messages may be transmitted from Wilson to Edenton and other adjacent points in North Carolina, but this line traverses a part of the state of Virginia, passing through the city of Norfolk"; and it properly holds, upon the evidence, "that the telegraph office at Edenton is under the control of the defendant, and the operator, though employed by the railroad company, is the agent and operator of the defendant." It necessarily follows from this state of facts that, as the defendant could have sent the message the whole distance over its own line, it cannot be heard to say that it did not do what it ought to have done, and thus collect 50 cents for the message, instead of 25, as allowed by the commission tariff. The defense set up, that in fact it only carried the message to Norfolk, and then paid another company to forward it to Edenton, cannot be regarded when it might itself have completed the delivery of the message. The defendant seeks to excuse itself on the plea that it has only one wire to Edenton, and that this is fully occupied at that office by the work it does for the railroad company. But it is the duty of the telegraph company to have sufficient facilities to transact all the business offered to it for all points at which it has offices. If the press of business offered is so great that one wire or one operator at a point is not sufficient, it is the duty of the company to add another wire or an additional employé. It is not a mere private business, but a public duty, which the defendants, by their franchise, are authorized to discharge. It is further to be noticed that in giving to the railroad company the preference in the use of their line to Edenton, while at other points, as Moyock, Centreville, and Hertford, on the same line, the public is admitted to the use of the wire, the defendant is making a forbidden and illegal discrimination in favor of one customer, and against the public at large, as was intimated in Albea's Case, 113 N. C., on page 226, 18 S. E. 389. The findings of fact and evidence are fuller, and present a somewhat different and stronger case against the defendant, than in Albea's Case. By Section 11 of the defendant's contract with the railroad company, the defendant remains owner of the telegraph line to Edenton, N. C., and its belongings, which are to remain "part of its general telegraph system," and "to be controlled and regulated by the telegraph company." Section 3 of the contract gives the railroad messages precedence over commercial business, but stipulates that, when railroad business shall require the exclusive use of one wire, the telegraph company shall, on 60 days' notice, furnish material for a second wire, which second wire shall be used for railroad business exclusively, and such commercial business as can be done without interfering with railroad business. Section 6 provided that, where the railroad company shall open offices, the operators, "acting as agents of the telegraph company," shall receive such commercial and public telegrams as may be offered, collecting rates prescribed by the telegraph com pany, and render monthly statements, and pay over the receipts to the telegraph company. Section 7 provides that, whenever the volume of business at any point justifies it, the telegraph company shall put in an additional operator. It will be thus seen that the line to Edenton is an integral part of the defendant's general telegraph system. It is only by virtue of its franchise as a telegraph company that it can operate its line to Edenton at all. It cannot discriminate at that point in favor of or against any customer. It cannot subtract itself from obedience to the rates prescribed by the authority of the state, acting through the commission, by a contract giving one customer-the railroad-preference in business, and pleading that such business occupies the only wire it has. The discrimination is itself illegal. Besides, if it were not, the small cost of an additional wire, which it is common knowledge does not exceed $10 per mile, furnishes no ground to exempt the defendant from furnishing the additional facility to do the business for all. The charge of a double rate between Edenton and other points in North Carolina is a far heavier imposition upon the public than the cost of the additional wire to defendant, and is just the kind of burden and discrimination which the commission was established to prevent. In Albea's Case, supra, no commercial message was tendered, and the point now decided was not presented by the record. The ruling of the commission is in all respects affirmed. HARTSELL v. COLEMAN et al. (Supreme Court of North Carolina. April 2, 1895.) DEEDS-VAGUE DESCRIPTION-EXTRANEOUS EVI DENCE. A description of lands in a deed as "lying on the west side of Spring street, and north of Mill street," followed by courses and distances from "a stone" on Spring street around a parallelogram to the place of beginning, without indicating whether the starting point is at the intersection of Spring and Mill streets, or at a more remote point, is not so vague and uncertain on its face as to require the exclusion of proof aliunde to locate the land by fitting the description to the lot claimed under the deed. Appeal from superior court, Cabarrus county; Boykin, Judge. Action by J. L. Hartsell against W. C. Coleman and others for the possession of land. From a judgment for plaintiff, defendant Coleman appeals. Reversed. The defendant, in order to meet the prima facie case made by the plaintiff in an action for title and possession of land, introduced two mesne conveyances, which connected him by an older deed with the grantor of the plaintiff, and proposed to offer testimony to locate the calls of said conveyances so as to cover his possession. The description in the deeds was as follows: "All |