32 S.E. 34 | Va. | 1899
delivered the opinion of the court.
This is an action of assumpsit brought by Peed & Son against the City National Bank of Norfolk to recover back money alleged to have been paid un4er a mistake.
The material facts upon which the plaintiffs based their right to recover are as follows :
On the 19th day of November, 1894, at a called meeting of the directors and stockholders of the Union Milling Company, it was determined that more money was needed to conduct the business of the company advantageously, and that it should borrow an additional sum from the defendant bank, to which it ivas then indebted by note in the sum of $2,000. To accomplish this, it was agreed, and a resolution passed to that effect, that each stockholder should take an additional block of stock to the extent of $1,000, except Hall, the secretary of the company, wha should only take $500, and that each stockholder who took should give his note to the company for an amount equal to one-half of all the stock in his name, and that these notes should be attached, as collateral security, to the note given to the bank for the additional loan. Six of the stockholders took additional stock, and all of them executed their several notes therefor to
On September 25, 1895, at a called meeting of the stockholders of the milling company, Hall, the secretary of the company, made a statement to the effect that all efforts to secure additional stock had been rendered abortive, owing to the then existing indebtedness of the company to the defendant, and on his motion it was then “resolved that, if the bank [thedefendant] would release the Union Milling Company of the $5,500 of its indebtedness, that each stockholder give his personal note to the bank, obligating himself to pay the same” ; the notes having-been previously given by the stockholders to the Union Milling Company, which company had received the money from the bank on said notes. A committee was thereupon appointed, consisting of Hall and another, to wait upon the defendant, and see if its officers would consent to accept such notes in lieu of the note of the company. Hall took the notes executed under the resolution to the defendant bank, and stated to its cashier that it was the wish of the milling company to retire $5,500 of its indebtedness to the defendant, and, in order to accomplish that end, it proposed to withdraw the $7,500 note, and in lieu thereof the bank should re
The note which Peed executed under the resolution of September 25, 1895, payable directly to the defendant, after several renewals, was paid by him. Some time afterwards the defendant demanded payment of the $1,000 note executed by him to the milling company, and which had been deposited with the defendant under the resolution of November 19, 1894. Peed, when the demand was made, claimed that he had paid that note ; but the defendant insisted that it held it as collateral security for the payment of the $2,000 nóte, and other indebtedness due from the milling company to the defendant. Peed thereupon stated to the president of the defendant bank that he supposed it to be correct, and a note for $1,113.95 (which was the amount, principal and interest, of the $1,000 note) was executed by the plaintiffs to the defendant. There was evidence tending to show that, at the time the note for $1,113.95 was given, the $1,000 note, and renewals of it, payable directly to the defendant, which Peed had taken up, had been laid aside, and that he did not know where they were, and that at that time the condition of Peed was such that he did not attend to business ; that Jordon, one of the members of the firm of Peed & Son, the plaintiffs, paid $791.95 on the $1,113.95 note, but at the time he paid it he did not know any of the facts and circumstances connected with the giving of the note by Peed to the milling company, or the giving of his note payable to the defendant, but supposed that the first-named note was due and unpaid, from the fact that the defendant held and demanded payment of it. It is to recover the sum thus paid that this action was instituted.
But even if this were not so, and it appeared that the defendant had been injured by accepting the stockholders’ notes for the company’s indebtedness to the extent of $5,500, it would not affect the question. It was the duty of the defendant, before accepting the notes of the stockholders, under the resolution of September 25, 1895, from Hall, the agent appointed by the company and its stockholders to effect the arrangement provided for in that resolution, to ascertain his authority; and, if it failed to do so, it acted at its peril. It is true, the notes were negotiable and' in Hall’s possession ; but he was no party to them, and the defendant, being the payee, could alone assign or transfer them. Hall, therefore, had no right to deal with the notes, except as the agent of the makers. The defendant, in dealing with him, was put upon its guard by that very fact, and dealt with him at its own risk. It cannot rely for its protection upon Hall’s assumption of authority, — upon what he disclosed, or failed to disclose, as to the purpose for which the notes were made, — but it must be regarded as receiving the notes in the light of the resolution under which Hall was acting.
It is clear, as we have seen, that the notes executed under the resolution of September 25, 1895, were to be in lieu of, not in addition to, those executed under the resolution of November 19, 1894 ; and, when they were paid, neither the milling company nor the defendant had the right to collect the notes executed under the last-mentioned resolution.
The instruction asked for by the defendant was properly refused by the court. By it the jury were told, in effect, that a party cannot recover back money paid under a mistake of fact, if he could (if it was possible) before payment have put
The instructions given by the court in lieu of those offered by both parties correctly stated the law, and fairly submitted the question to the jury; and, the jury having found that the money sued for was paid under a material mistake of fact, we cannot say that, under all the facts and circumstances of the case, their verdict was contrary to the law and the evidence.
The judgment complained of must therefore be affirmed.
Riely and Cardwell, JJ., absent.