Brown v. Ames

59 Minn. 476 | Minn. | 1894

Mitchell, J.

This action was brought to recover the amount of a note sold by defendant to plaintiff, wjfich purported to have been executed by George A. Morse, payable to his own order, and indorsed by himself and his father, Elisha Morse. The ground on which a recovery was claimed was that the indorsement of Elisha Morse was forged. The defendant interposed two defenses: First, a denial that the indorsement was forged; and, second, that in selling the note he merely acted as agent for a disclosed principal, one Newton.

1. To maintain the first defense, evidence was introduced tending to prove that the indorsement was made by Elisha Morse in person, in his own handwriting. No complaint is made that this evidence was not fairly submitted to the jury. Evidence was also introduced which, it is claimed, tended to prove that the indorsement was made by George A. Morse by authority, actual or apparent, from his father. We do not think this evidence made a case for the jury. This was certainly so upon the question of apparent, as distinguished from actual, authority, for the reason that it does not appear that any of the parties who dealt with this note knew of any of the acts of Elisha which are claimed to have clothed his son with such authority; and consequently these acts could not have influenced their conduct.

Of course, it is familiar law that the responsibility of a person for acts done in his name by another, merely on the ground that the former had clothed the latter with apparent authority to do the act, rests upon the doctrine of equitable estoppel. Neither do we think that there was any evidence that would have justified the jury in finding that’ George had actual or real authority to sign his father’s name. The father testified positively and unqualifiedly that he never authorized any one to write his name on the note, and never in any manner consented to its being done. The only evidence, if any, tending in the slightest degree to contradict or impair the force of his testimony is to be found in the circumstances attempted to be recited in defendant’s eighth request to charge. If there had been other evidence of the son’s authority, some of these circumstances might have been corroborative; but, standing alone, they are wholly insufficient to establish the fact. Stated in the strongest light, all these circumstances amounted to was that the father, when he discovered that his son had forged his name to a previous note, instead of publishing his crime to the public, and warning them against Mm, and breaking off all intercourse with Mm, concealed the crime, made his son refund the money he had obtained on the forged paper, and continued to correspond with him thereafter. It can hardly be necessary to say that such acts, dictated by paternal feelings, would not prove authority to the son to sign his father’s name to other paper. It is therefore unnecessary to consider any of the assignments of error relating to the manner in which the court submitted to the jury the issues involved in the first defense.

2. Notwithstanding that a few cases, notably in Maine and Maryland, upon a “somewhat shadowy distinction,” make certain exceptions to the rule, yet the doctrine is too well established to admit of discussion that where one sells or transfers commercial paper, although not a party to the instrument, or he indorses it “without recourse,” the vendor impliedly guarantees that the signatures to the paper are genuine, and not forged, unless it is expressly understood at the time of the sale that he refuses to guaranty its genuineness. See Benj. Sales (Gth Ed.) 638, and cases cited.

The fact that the plaintiff pleads as being express the same warranty which the law implies will not prevent a recovery although he fails to prove an express warranty.

If a person is selling the paper as agent for another, he can relieve himself from personal liability only by disclosing to the purchaser the fact of his agency and the name of his principal. It is not enough merely to give notice of the fact that he is acting as agent; he must also disclose who his principal is. The reason of the rule is that the purchaser may determine the responsibility of the principal to answer for any failure of title to or genuineness of the paper. Moreover, the person named as principal must be a principal in fact, a person for whom the agent is authorized to act, and who will be legally bound by his act. These propositions are so elementary that the citation of authorities in their support is unnecessary.

If there was any evidence that the defendant was the authorized agent of Newton to sell this note, we are inclined to think that the charge of the court would be subject to some of the criticisms of counsel.

It is not necessary that an agent, to relieve himself of personal liability, should say, in so many words, “I am acting merely as agent for A., who is my principal.” If such a state of facts occurred that the plaintiff understood, or ought, as a man of reasonable intelligence, to have understood, that he was buying the paper from Newton, and not from defendant, this would have amounted to a sufficient disclosure of defendant’s agency and of the name of his principal. Worthington v. Cowles, 112 Mass. 30. But we have examined and re-examined the record in this case with great care, and have been unable to find any evidence that defendant ever was the agent of Newton for any purpose. Hence, even if defendant had expressly stated to plaintiff in so many words that he was acting merely as agent, and that Newton was his principal, we cannot see that it would have availed him.

The prior history of this note is left in some obscurity. The evidence tends to indicate that Newton was not the owner, but merely held it as broker, to sell for some one else. But this is perhaps immaterial. It appears from the evidence that the only negotiations between Newton and defendant were with reference to defendant himself becoming the purchaser of the paper, and that it was intrusted to his possession solely with reference to and for the purposes of such contemplated purchase. Newton had told defendant he was expecting to receive such a note, and that the discount would be so much, and asked him if he did not want it. When the note arrived, Newton gave it to defendant, for the sole purpose, so far as appears, of inspection and examination, to enable him to determine whether he would take it. • Defendant, not having the funds to take it himself, applied to plaintiff to do so, naming the amount for which he could have it at a sum slightly in excess of the amount for which Newton offered it to him. Plaintiff paid for it in a check payable to defendant, which the latter deposited to his own credit, and then by his own check paid Newton the amount for which the latter had offered the note. Not a word, so far as appears, ever passed between Newton and defendant in regard to the latter- selling the note as agent of the former. Plaintiff’s name was never once mentioned as the purchaser of the note. On the contrary, the transaction between defendant and Newton was conducted and closed up entirely upon the basis of defendant himself being the purchaser of the paper. The only time that the name of plaintiff or any third party was ever mentioned between Newton and defendant in connection with the purchase of the note was, according to defendant’s testimony, when in one of the interviews between them before the arrival of the note defendant “told him [Newton] that he had a conversation with Mr. Brown about taking it.” The insufficiency of any such casual remark to create the relation of principal and agent between defendant and Newton is too apparent to require-discussion. In short, it seems to us that, as to the principles of law applicable, the case stands precisely as if defendant had himself bought the paper of Newton, and subsequently sold it to the plaintiff.

As we view the evidence, really the only issue for the jury was whether the indorsement of Elisha Morse was genuine or forged. The loss to defendant is large compared with the small profit which he made out of the transaction, but this is the result of his own acts. As between him and the plaintiff, both of whom doubtless acted in the utmost good faith, the loss must, on the clearest principles of law,, fall on the defendant.

Order affirmed.

(Opinion published 61 N. W. 448.)