Hastings v. Dollarhide

24 Cal. 195 | Cal. | 1864

By the Court, Shafter, J.

This is an action on a non-negotiable promissory note, executed by the defendants to Ysabel Armijo, on the sixth day of September, 1858. The note was for one thousand dollars, bearing interest at one per cent per month until May 6, 1859, and at the rate of two per cent per month thereafter until due, September 6, 1859.

The complaint alleges that on the day the note was executed it was transferred to the plaintiff by indorsement, in consideration of eight hundred dollars paid by him to the payee, Ysabel Armijo.

The complaint was filed October 6, 1860; summons was issued November 20, 1860, and served on all the defendants (fourteen in number) except James Jeans; and all of the defendants, except Jeans, appeared and answered jointly. The answer contained:

First—A general denial.

Second—A special defense that the note was given without consideration.

Third—A special defense, setting forth that the said Ysabel Armijo sold and conveyed an undivided one sixth of certain lands situate in the County of Solano to the defendants and others named in the deed, and that the said note “was a part of the consideration of the conveyance.” That the grantor, at the date of the conveyance, was an infant under eighteen years of age, and that after arriving at the age of legal majority she refused to confirm the aforesaid deed, but executed a deed of conveyance of all her estate in the land to H. H. Hartley, whereby she disaffirmed the deed to defendants; and it is alleged that the consideration of the note has thereby wholly failed.

The trial was by the Court, and on the findings judgment was entered for the defendants. The plaintiff appeals from the judgment, and also from an order denying a motion for new trial.

It appears from the record that Ysabel Armijo was born December 30, 1841, thus attaining her majority December 29, 1859 ; that on the 6th of September, 1858, she made the conveyance to the defendants alleged in the answer, and on the same day received from the defendants the note in question; that the note was a part of the consideration of her conveyance, the balance of purchase money (one thousand dollars) having been paid at the date of the deed; that on or about the day of its 'date, the note was delivered by Ysabel and her stepfather to one Munk, for the purpose of collection or discount ; that Mutík sold and transferred the note to the plaintiff, Hastings, on the 28th of October, 1858,' for eight hundred dollars, which amount was paid to Munk in two instalments; that the note was indorsed as follows: “Ysabel Armijo.” “ By her attorney in fact, Thomas K. Munk, as her power of attorney, filed October 28,1858, and recorded in Liber 1, page 182, 183, of Solano Coiuity records.” It further appears, that before October 27, 1860, said Ysabel intermarried with Diego Morales, and that on said 27th of October, 1860, she and her husband executed a deed, duly acknowledged, to H. H. Hartley, for the land meutionedrimihe-'SaKÍ deefcj of September 6,1858; that in the deed to Hartley there is a declaration by said Ysabel to the effect that, by said deed, she rescinds and annuls all contracts and conveyances made or purporting to have been made by her during her minority, in any way affecting said tract of land. The deed also contained a covenant against all legal conveyances previously made by the said Ysabel. There was no evidence tending to prove that Hastings, at the time when the note in suit was transferred to him, (October 28, 1858,) had any notice that Ysabel was an infant; neither was there any evidence tending to prove that the defendants had any notice of their grantor’s disability on the 6th of the same month, when they took their deed. The power of attorney referred to in the indorsement of the note to the plaintiff was given in evidence by him, and it is sufficiently broad in its terms to authorize Munk to sell and assign the note.

It appears from the findings that the Court below considered that the plaintiff was not the owner of the note as between himself and his alleged assignor, and that, therefore, the plaintiff had no right of action on the note against the parties by whom it was made; and, further, that the conveyance made by Ysabel to Hartley, after attaining her majority, had worked an entire failure of the consideration on which the note was given. These questions will be treated sej>arate and apart from each other.

1. As to the title of the plaintiff to the note.

It is insisted for the respondents that the power of attorney given to Munk by Ysabel was void by reason of her infancy, and that the indorsement falls with the power.

The rule is well settled that no one can take advantage of the fact of infancy except the infant himself, or his heirs or personal representatives. If the defendants in tins action have the right to controvert the title of the plaintiff to the note in suit on the ground of the infancy of Ysabel Armijo, it must be on the hypothesis that the assignment is not voidable merely, but void, and that therefore payment by the defendants to the plaintiff would leave them still exposed to an action at the suit of Ysabel.

It is now well settled as a part of the law merchant that an infant may make or indorse a promissory note or bill of exchange, and that, as to him, the note in the one case and / the indorsement in the other will not be void, but voidable I at his election. (Nightingale v. Wittington, 15 Mass. 272; Hardy v. Waters, 38 Maine, 450; Storey on Promissory Notes, section 78.

It is also established by the tenor of the modern decisions that an infant may execute a promissory note by agent. In Whitney v. Dutch, 14 Mass. 457, it appeared that of two co-partners in trade, one was an infant, and the other of full age. The adult, for a debt of the co-partners, made a promissory note in the name of the firm, and the infant, after coming of full age, ratified it; and it was holden good against him. It has also been held that an infant promissee may, by parol, authorize another to transfer a note by indorsement for him, and that the transfer so made will be held valid until avoided. (Hardy v. Waters, 38 Maine, 450.) In the case last cited, it was admitted that an infant might transfer a note payable to himself by indorsement, and the point directly presented was, whether he could confer upon another ■ power to do it for him. (3 Wend. 479; 17 Wend. 419; 2 Hill, 120; 11 Wend. 85.)

Mr. Chancellor Kent, in summing up the doctrine, says: “It is held that a negotiable note, given by an infant, even for necessaries, is void ; and his acceptance of a bill of exchange is void; and his contract as security for another is absolutely void; and a bond, with a penalty, though given for necessaries, is void. It. must be admitted, however, that the tendency of modern decisions is in favor of the reasonableness and policy of a very liberal extension of the rule that the acts and contracts of infants should be deemed voidable only, and subject to their election when they become of age, either to affirm or disallow them. If their contracts were absolutely void, it would follow as a consequence that the contract could have no effect, and the party contracting with the infant would be equally discharged.”

In the case at bar the note executed to the infant payee was not negotiable; but, on principle, no distinction can be taken between negotiable and non-negotiable notes in the matter of the power of an infant to make or to indorse them. The cases cited proceed upon the ground that infants are fully protected by the rule holding their contracts of every description voidable in their election, with the exception of a few peculiar contracts, in relation to which the Court can say, on inspection, that they are necessarily prejudicial to the infant, and of these the contract of suretyship may be stated as an example.

In view of the foregoing authorities, as well as upon principle, we are satisfied that both, under the written power given by Ysabel Armijo to Munk, and the verbal directions given by her to him at the time she put the' note into his hands for collection or discount, he was authorized to sell and transfer the note to the plaintiff, and that when Ysabel became of age she had it in her power to ratify or disaffirm the assignment.

But another and perhaps more important question here presents itself. It is whether the transfer by the infant is operative in favor of the plaintiff as assignee, so that he may receive or enforce payment of the note from the defendants, and give a discharge therefor. It seems now well settled that an indorsee deriving title from an infant indorser, acquires a good and valid title to the note against every other party thereto, except the infant, since the title is not void, but voidable only. The infant may, indeed, at any time before ratifying the transfer, intercept payment to the indorsee, or by giving notice to the maker of his avoidance, furnish to him a valid defense against the claim of the indorsee. But until he does so avoid it, the indorsement is to be deemed, in respect to such antecedent parties, a good and valid transfer. (Grey v. Cooper, 3 Doug. 65; Taylor v. Crocker, 4 Esp. 187; Jones v. Darch, 4 Price, 300; Nightingale v. Wittington, 15 Mass. 272; Storey on Bills, Sec. 85.) In the case at bar there has been no attempt made on the part of Ysabel Armijo, either before or since she became of age, to avoid her assignment to Hastings, nor has she at any time attempted to collect the note of the defendants in disregard of that assignment—nor, so far as the record shows, has she ever given any notice to the defendants that she did not intend to abide by the transfer to Hastings. In the case of Nightingale v. Wittington, 15 Mass. 272, a minor had received a negotiable promissory'note in payment of labor in the employment of the maker of the note, and had indorsed the same to a third 2>erson for a valuable consideration, the indorsee knowing the indorser to be under age; and afterwards the father (who had previously emancipated his son in effect, by neglecting to provide for him) received the amount of the maker in discharge of the note, both the father and the maker knowing of the indorsement.

It was held that the maker could not himself deny the validity of the indorsement, and that inasmuch as the infant had never disaffirmed it, and inasmuch as the payment to the father was a payment by the maker in his own wrong, the indorsee was entitled to judgment.

The fact that the note given by Ysabel Armijo was nonnegotiable, is, as we have already intimated, entitled to no consideration, so far as the question of the plaintiff’s title is f concerned. Notes non-negotiable at common law are made negotiable with us by positive statute. True, the persons to whom such notes are transferred hold them subject to all defenses that might be urged in suits against the maker brought by the payee; but that fact is not inconsistent with an absolute ownership of the securities vested in the party to whom they may have been transferred.

But there is another ground on which the title of the plaintiff to the note in controversy may be rested. Ysabel Armijo, since she became of age, has ratified her assignment to the plaintiff, and has thereby made it impossible for her to compel the defendants to pay the note a second time. In the absence of all proof to the contrary, it must be presumed that Munk accounted to his principal for the money paid him by the plaintiff. Ysabel became an adult on the 29th of December, 1859, and this action was commenced about eleven months thereafter. During this interval she made no offer to return the money received by her from Hastings, nor did she do anything nor did she say anything indicating any purpose on her part to disaffirm her indorsement. The contract between herself and Hastings was not executory, but .executed, and her silence and inaction for the period named, coupled with the retention of the consideration paid her—both facts being unexplained—amount to a ratification by “mediate” presumption. (11 Stark. Ev. 745.) On this point the authorities are numerous and decisive; but as we shall have occasion to refer to them in discussing another but analogous question, one case only will be cited here. In Delano v. Blake, 11 Wend. 85, where an infant took the note of a third person in payment for work done, and retained it for eight months after he became of age, and then offered to return it and demanded payment for his work, it was held, in an action for work and labor performed by him, that the retaining of the note for such a length of time was a ratification of the contract made during infancy.

2. As to the alleged failure of consideration.

As a general rule the deed of an infant is not void, but voidable. This is the established doctrine of all the modern decisions. An infant grantor can neither affirm or disaffirm a conveyance of land .made during nonage until he attains to the age of legal majority. It was so held in the leading case of Zouch v. Parsons, 3 Burr, 1,794, decided in 1765, and the rule has been steadily adhered to in England and America ever since. If an infant grantor, after attaining to mature age, execute a conveyance of lands embraced in a deed made by him when a minor, it is settled, as a general proposition, that the second conveyance will work a disaffirmance of the first. But it is clear that' if an infant, after arriving at adult age, ratifies a conveyance made by him during his infancy, he will have no power to revoke the ratification and disaffirm such conveyance thereafter. Conceding, then, that the deed of Ysabel Armijo and husband, to Hartley, was in itself considered an act of disaffirmance, it becomes material to ascertain whether she had not, in effect, ratified the prior deed to the defendants before that act of disaffirmance was performed.

The exemption of infants from liability on their contracts proceeds solely upon the principle that such exemption is essential to their protection; and it is admitted that the law of infancy should be so administered that that result may, in all cases, be secured. But it has not unfrecjuently happened that Courts, in their anxiety to protect the rights of infants in the matter of contracts made by them during nonage, have, after they have become adult, treated them to some extent as infants still, exempting them from the operation of rules of law, not only of general obligation, but founded in essential justice. The strong tendency of the modern decisions, however, is to limit the exemptions of infancy to the principle upon which the disability proceeds.

In considering the question of ratification with which we have to deal, it is to be remembered that the contract of sale made between Ysabel Armijo and the defendants, on the 6th of September, 1858, was fully executed on the day of its date by the delivery of a deed on the part of Ysabel, and a pay-t ment to her by the grantees of a part of the purchase money and the execution of their note for the balance. There is a distinction taken between executory and executed contracts in the matter of ratification, but it is the law of the latter class of contracts only that we now have occasion to consult.

In Baylis v. Dinely, 3 Maule & Sel. 481, it was held that a parol confirmation of a bond given by an infant after he came of age was invalid, and that the confirmation should be * by something amounting to an estoppel in law, and of as high authority as the deed itself, and of equal solemnity.

In Tucker v. Moreland, 10 Pet. 75, after citing the foregoing case, Mr. Justice Story remarks upon it as follows: “Without undertaking to apply this doctrine to its full extent, and admitting that acts in pais may amount to a confirmation of a deed, still we are of opinion that those acts should be of such a solemn and unequivocal nature as to establish a clear intention to confirm the deed, after a full knowledge that it was voidable.”

In Jackson v. Carpenter, 11 John. 542, and in Austin v. Patton, 11 S. & R. 311, the rule as stated in Baylis v. Binely was still further relaxed; for, according to those cases, acts of ratification are not required to be “solemn,” nor is it requisite that they should be absolutely “ unequivocal;” but if, when fairly construed, they are found to be “evincive of assent,” they are held to be sufficient. But the rule in Baylis v. Dinely has been subjected to still further modification. In Houser v. Reynolds, 1 Hayw. 143, the plaintiff and defendant both claimed under one Wright, who, while an infant, had conveyed to Houser, and after coming of age had conveyed the same lands to Reynolds; but before making such conveyance, and after coming of age, he said to Houser: “I will never take advantage of my having been an infant at the time of executing the deed, and it is my wish that you should keep the land.” It was held that these words ratified the conveyance. Here, there was no act done, and the words used were used informally. This decision is sustained in the matter of contracts executory, by Goodsell v. Myres, 3 Wend. 479; Rogers v. Heard, 4 Day, 57; Wilcox v. Roath, 12 Conn. 550; Hale v. Gerrish, 8 N. H. 374; Bigelow v. Hewlett, 19 Wend. 301. In Orvis v. Kimball, 3 N. H. 314, it was held that a declaration of an intention to pay a note, and authorizing an agent to take it up, was a good ratification, although the agent had done nothing about it.

The real estate cases so far cited, though differing inter seso as to the rule of ratification now in question, all agree, however, that the deed of an infant cannot be ratified by mere silence or inaction, no matter how protracted ; and (in Bailey v. McKenney, 23 Maine, 523) a reason is suggested: “ Where a person has made a conveyance of real estate during infancy, and would affirm or disaffirm it after he becomes of age, in such case mere acquiesence for years affords no proof of a ratification. There must be some positive and clear act performed for that purpose. The reason is, that by his silent acquiescence lie occasions no injury to other persons, and secures no benefits or new rights to himself. There is nothing to urge him as a duty toward others to act speedily. Language appropriate in other cases, requiring him to act within a reasonable time, would become inappropriate here. He may, therefore, after years of acquiescence, by an entry or by a conveyance of the estate to another person, disaffirm and avoid the conveyance made during his infancy.” The consequences to the grantee of enduring silence on the part of the grantor after he has become an adult are, as we conceive, misapprehended in this opinion, and their character is very differently presented in cases to be cited hereafter. The decision in Lessee of Drake v. Ramsey, 5 Hammond, 251, marks another step in the progress of judicial opinion upon this subject, for the Court say: “ In our opinion, lapse of time may frequently furnish evidence of acquiescence, and thus confirm the title of the first purchaser; but, of itself, it does not take away the right to avoid until the Statute of Limitations has run.” The same doctrine was afterward affirmed in Cresinger v. Lessee of Welch, 15 Ohio, 193.

In the case of Kline v. Beebe, 6 Conn. 794, the effect of silent acquiescence on the part of a grantor—after becoming of age—to ratify a deed given during infancy, was fully considered and adjudged. The action was ejectment, and the plaintiff claimed title as tenant by the courtesy. He was the husband of Patty Kline, deceased, formerly Patty Bolles. In 1791, Patty, being then under age, executed to Ebenezer Bolles a quitclaim deed of the premises, and received from Ebenezer his promissory note for the purchase money. Within a year after Patty became of age she intermarried with the plaintiff, by whom the note was held during an interval of ten years, when this action was commenced. During this period of eleven years, and until the commencement of the plaintiff’s action, a profound silence was observed relative to the disaffirmance of the deed, and the defendant was permitted to remain in the unquestioned occupation of the lands. It was held by Hosmer, C. J.—Brainard, Lanrner, and Daggett, Justices, concurring—that there were three modes of affirming the voidable contracts of infants : 1: By an express ratification; 2. By performance of acts from which an affirmance might be reasonably implied ; 3. By an omission "to disaffirm within a reasonable time; and that on the facts of the record before them there was both an implied and tacit affirmance of the conveyance.

In Scott v. Buchanan et als., 11 Humph. 468, it was held that the voidable deed of an infant might be affirmed by an express ratification, or by acts which reasonably implied an affirmance, or by the omission to disaffirm the deed within a reasonable time ; and it was further considered that “ reasonable time” was a question of fact necessarily depending on the circumstances of each particular case. Held, in Jones v. Butler, 30 Barb. 641, that infant parties to a marriage settlement must avoid it within reasonable time after coming of age, or it would be considered as having been ratified by them.

In Richardson v. Bright, 9 Vt. 370, it was held “that in the case of every act of an infant, merely voidable, he must disaffirm it on becoming of full age, or he will be bound by it,” and the case of Kline v. Beebe was cited with approbation, and Mr. Justice Redfield says in the opinion: “ The doctrine of that case is but the long established doctrine of the common law.” This statement of the learned Judae is sustained by Co. Litt. 51b: “ If an infant exchange lands, and after his full age occupy the lands taken in exchange, thereby the exchange is become perfect.” And it is further justified by the decision in Holmes v. Blogg, 8 Taunt. 35, in which case it is observed : “ The infant is bound to give notice of the disaffirmance of a voidable contract in reasonable time ; and if the case before the Court were that simple case, I (Dallas, Judge, afterward Chief Justice) should be disposed to hold that as the infant had not given express notice of disaffirmance within four months, he had not given notice in reasonable time.”

In Delano v. Blake, 11 Wend. 85, an infant, after becoming of age, held a note for eight months, given hbn for work and labor while an infant, and it was held that it was too late to disaffirm. Chancellor Kent, K. Com. 11, 263, referring to Holmes v. Bloggs, 8 Taunt., already cited, says: “The inference from that doctrine is, that without some act of dissent, all the voidable contracts of the infant would become binding. * * * This is the usual course when the infant does not intend to stand by his contract; and the confirmation of the act or deed of his infancy may justly be inferred against him after he has been of age for a reasonable time, either from his positive acts concerning the contract, or from his tacit assent under circumstances not to excuse his silence.”

In the cases cited there is a marked disagreement as to whether mere acquiescence on the jaart of an adult will ratify a deed made by him while an infant; but in the case of a purchase made by an infant, the decisions are uniform that if the infant retains the property purchased, whether it be real or | personal, and gives no notice of an intention to disaffirm within , a reasonable time after he arrives at full age, it will be suffi- " cient evidence of a ratification. Some of the leading cases upon the subject are Boyden v. Boyden, 9 Met. 519, Boody v. McKenny, 23 Maine, 517, Hubbard v. Cummings, 1 Greenl. 11, where this doctrine is applied to the purchase of real estate. On principle, we can see no difference between the case of an infant grantor and the case of an infant grantee, justifying a distinction between them. If the infant, on attaining majority, is bound by the rule of diligence in the one relation, then he must be in the other; and if he is exempt from the rule in either relation, then he. must be exempt in both. Whether the infant stands as grantor or grantee in the deed to be ratified or avoided, good faith, public policy, and the very principle upon which the law of infancy is based, require that he should make his election within reasonable tiriie after he becomes of age. To hold otherwise would make the disability of infancy a “ sword” rather than a “ shield,” and, in the language of Mr. Chief Justice Hosmer, 6 Conn. 505, would extend to the adult unlimited license “to hold the scales in Ms own hand, and decide as further circumstances should incline.”

We consider the rule as given by Chancellor Kent, and as adjudged in the 6 Conn., 8 Taunt., 9 Vt. and 11 Humph., to be the true rule of the common law, as stated m Coke upon Litt. 51b, and there applied to the case of land acquired by exchange. The points of difference between title by exchange and title by purchase are technical and circumstantial. They relate to the modes of acquiring rather than to the results of title when acquired; and where results are confessedly uniform andSonstant, why should the law be at once embarrassed and blemished by arbitrary distinctions concerning them ? The central doctrine and whole purpose of the law of infancy is the protection of the infant ,* and if infants, under the rule in Coke upon Litt., are adequately protected against improvident exchanges of land made during their minority, so they must be against improvident purchases and sales.

We have considered this case at length for the reason that the authorities are in conflict; the questions involved are made here for the first time, and for the purpose, if possible, of subjecting exchanges and executed sales and purchases of both real and personal property by infants to one uniform rule, so far as the ratification or disaffirmance of such contracts is concerned.

There is another question raised by the record, but as it is unnecessary to decide it, we shall refrain from discussing it. Can an infant after becoming of age disaffirm a conveyance made during infancy, without returning, as a part of the process of disaffirmance, the consideration received, in so far as the consideration, whether in money, securities, or chattels, may be within his power or control ?

Judgment reversed and new trial ordered.

Mr. Justice Currey, havmg been of counsel, did not sit on the trial of this case.