89 Mo. App. 217 | Mo. Ct. App. | 1901
This is a suit on a promissory note dated the eighth day of May, 1896, payable to the Stanberry Normal School Association, a corporation, for the sum of $1,875, and negotiable and due on or. before September 1, 1897, with eight per cent interest from date. This note was indorsed in blank and delivered to one Terrence W. Costello, before due, by the president of the association, and Costello in
The facts- of tbe case, in a general way, are these: Prior to the execution of the note in controversy, the building of the corporation, was burned and all its contents were destroyed. At that time the defendant was the owner of the greater part of the capital stock of the corporation. It was determined to rebuild and the officers of the corporation decided to make an effort among the citizens of Stanberry for financial assistance for that purpose. Committees were appointed for the purpose of soliciting among the citizens for subscriptions to the capital stock aforesaid, and while this was being done it was discovered that policies of insurance to the amount of $4,000 on the building destroyed had been pledged to secure an individual debt of the defendant owing to the Tootle estate in St. Joseph, Missouri. When this was found out it was represented to the defendant by the officers of the corporation that by reason of that fact the citizens of the town would not subscribe for stock, unless he would make good for the use of the corporation the-amount of the insurance pledged to his use. There was only $3,750 of the $4,000 that was made available by the defendant; hence, the amount paid by the corporation over and above the insurance was $1,750. At the date of the note'defendant executed three notes payable to the corporation, to-wit: One for $1,750 and two for $1,875, each, making in the aggregate the sum of $5,500 — a sum corresponding to the debt which the defendant owed the Tootle estate, and which had been paid, as stated, in effect- by the corporation. At the time when these notes were executed it was thought by the corporation officers
One of the notes for $1,875 is now in suit. At the time of the execution of the notes the defendant put up as collateral security, $15,000 in shares of the corporation, about one-third of which was pledged to each one of the notes. It is claimed by the defendant that he was not to pay either of the notes for $1,875; that it was so agreed between the officers and himself at the time of their execution that the $1,750 represented his indebtedness to the corporation and that the other two were only executed for the purpose of satisfying the citizens of Stanberry so that they might be induced thereby to subscribe to the enterprise. Taylor, the head of the corporation, testified in the case that there was another and different understanding as to the consideration of the notes, and so did others; that, however, is unimportant as the peremptory instruction given tc the jury to find for the plaintiff was not based upon plaintiff’s evidence, but upon the evidence of the defendant, and if the case can not be sustained upon that theory, the instruction was erroneous. There was also in issue, before the jury, the bona tides of plaintiff’s ownership of the note; that he bought with notice of defendant’s rights; that the corporation had no authority to dispose of the note in question without the approval of the directory; and further, that the indorsement on the back of the note is to Gallatin Craig and not to the plaintiff.
Had the president of the corporation the right to dispose of the note in question without authority from its board of directors ? The plaintiff contends that the indorsement of the following words is prima facie evidence that the president, -I. A. Taylor, had authority to make it, and that, therefore, the note passed to the holder: “Without recourse, Stanberry Nor
In Musser v. Johnson, 42 Mo. 74, it was beld, tbat on tbe conveyance of real property, it must purport to be made and executed by tbe corporation acting by its duly authorized agent. But in matters of simple contract tbe rule is not so strict, aud an execution of an instrument will be inferred from tbe general principles of tbe law of agency. In Mo. Fire Clay Works v. Ellison, 30 Mo. App. 67, it was beld, tbat tbe authority of an officer of a corporation to execute a deed will be presumed in tbe absence of evidence to tbe contrary, where tbe same is acknowledged before a proper officer and tbe seal of tbe cor
Waiving this point, it is a question whether the defendant’s objection to the note when it was offered on the trial as evidence, raised the question of the authority of the president of the corporation without the direction of its board of directors to indorse it in blank or otherwise. When it was offered, counsel for defendant stated: “We object to the note sued upon, because, under the testimony and the pleadings and the note, as they now appear,, it is incompetent and not proper to be introduced in evidence, including the indorsement.” By the court: “It isn’t proper testimony. Is that the nature of your objection?” Counsel for defendant: “That is, it is not proper. The fact is, that the note shows that it is owned by Mr. Craig and not by the Bank of Barnard at all.” The first objection was a general one which did not raise the question of the authority of Taylor, the president of the corporation, to make the indorsement; the second was more specific, but it was to the effect that the indorsement showed that the note was owned by Mr. Craig and not by the bank — the plaintiff. Under this state of facts, there was no error in admitting the note and indorsement in evidence. The testimony that the indorsement was in the handwriting of Taylor, the president, prima facie' authorized the introduction of the note in evidence, there being no other objection.
There is nothing in the objection that there is an indorse
The main question in the case involves the action of the court in giving the peremptory instruction directing the jury to find for plaintiff on the whole evidence. It is not necessary to go over the evidence in detail. The evidence of the plaintiff that there was a sufficient consideration for the note need not be considered, as has already been said, for it is in-conflict with that of the defendant and the court would not be justified in giving a peremptory instruction where the evidence was conflicting. But it must stand or fall upon the whole testimony of the case. When the defendant showed on his part the inducement for the giving of the three notes, including the one in suit, that this one, as well as its mate for the same amount, was not to be paid, but was for the purpose of enticing citizens of the town of Stanberry to take stock in the corporation, and was to be surrendered up to him, did he thereby make any legal defense whatever to the action? If he did not, all the questions raised in the evidence as to the indorsement of the note and the bona tides of the holder became immaterial as the note in the usual course of business passed by delivery. Allen v. Harris, 79 Mo. App. 490; Cloud v. Book Co., 23 Mo. App. 319; Bank v. Stanley, 46 Mo. App. 440; Hawes v. Mulholland, 78 Mo. App. loc. cit. 500.
Hnder defendant’s own evidence he had no defense to the note. The agreement that he was not to pay two of the notes that were executed for the purpose of enticing citizens to take stock in the corporation, and that they were to be returned to him, did not raise an issue as to the plaintiff’s right to recover. And besides, the defendant testified that “these three notes
The note in question is supported by a valuable consideration, for in the language of the defendant: “These notes were given for the purpose of aiding the association, with the understanding that only one was to be paid.” It therefore follows, that as the defense attempted could not have been urged successfully, even as against the payee in the note, all alleged: errors in the admission and rejection of evidence by the court going ■ to notice to the purchaser or holder of the note were immaterial and could have no effect on the result.
Cause affirmed.
We do not understand Judge Broaddus to say that the president of a corporation, virtute officii, can assign the assets of the corporation, yet it is possible some of the language used by him might be so understood. We are of the opinion that such officer can not assign the assets unless he is, in some lawful manner, authorized so to do. Hyde v. Larkin, 35 Mo. App. 365. It was so held by the St. Louis Court of Appeals, in Ferguson v. Venice Transfer Co., 79 Mo. App. 352, where the authorities in this and other States are cited and discussed.
ADDITIONAL OPINION.
On the motion for rehearing my brothers, Judges Smith and Ellison, used the following language : “We do not understand Judge Broaddus to say that the president of a corporation, virtute officii, can assign the assets of the corporation, yet it is possible some of the language used by him might be so understood.” Most certainly the constructionjrat upon the intent of the opinion by them is the correct one. In my judgment there is no language in the opinion that warrants the construction, that the president of a corporation had any such power. That question was not directly in issue in the case. As to whether the cases of Hyde v. Larkin, 35 Mo. App., and Ferguson v. Venice Transfer Co., 79 Mo. App. 352, are in conflict witli the cases quoted in support-of the original opinion in this case, I do not deem it pertinent, to the inquiry here, and, therefore, will make no comment. Judges Smith and Ellison are to be commended for their vigilance as well as courtesy.