Hogan & Co. v. Reynolds

GOLDTHWAITE,

Thе investigation, severally, of each of the questions raised in this case, would swell our opinion to an undue length. We shall therefore limit ourselves to the decision of those points of evidence which were made at the trial, and the ascertаinment of the rules by which, in our judgment, the cause ought to have been governed in the Court below.

1. It was doubtless irregular to permit any witness to give evidence of the general law merchant, and it is very possible, if the objection was made to the relevаncy of such evidence, the exception would be of sufficient weight to reverse the judgment; but this point being one of no importance, as we consider the case, we decline any further expression upon it.

2. The next exception calls in question the propriety of permitting a witness to say, that his testimony was not intended to convey the impression to the jury, that he supposed the plaintiff would have lent the money to Hogan individually. We see no reason why such explanation should not have been given; the question asked of the witness was, whether Hogan, on his own responsibility, could have borrowed such a sum of money. The answer of the witness was, that he could, from some persons; and, as this was nothing more than the expression of his opiniоn, there was no impropriety in ascertaining if the plaintiff was intended to be included in his answer.

3. The only other exception to the evidence which is now insisted on, is, that which questions the right of the plaintiff to examine his witness, as to some money borrowed by Hogan, from one Ball, for which either the note of Hogan & Co. or of Hogan, Carr & Co. was given, because the note was not produced or accounted for. The true rule with respect to this matter, is well stated in Cowan & Hill’s notes, 1209, where it is said, “ but even where the law calls for the writing as the best evidence of the transaction to which it pertains, certain things relating to the writing, or the matters evinced by it, may be proved, without producing it, though they involve the fact of its existence.” Thus in an action for the purchase money of a note, sold by the ‍‌‌‌​​‌​​‌‌​‌‌‌​​‌‌‌​‌‌​​​‌​‌​‌​‌​‌​‌‌​​​‌‌‌‌‌‌​​‍plaintiff to the defendant, pаrol evidence of the sale may be given without producing the note, or accounting for its absence. [Lamb v. Maberly, 3 Monroe, 179.] So the existence of a deed for slaves, will not prevent parol evidence from being given, without its productiоn, for the purpose of characterising the] possession which accompanied it. [Spears v. Wilson, 4 Cranch, 398; see also, Rex v. Ford, 1 Nev. & Mann. 776.]

It might also be said, in answer to this exception, that it was not affirmatively shown that the note existed, and that the ordinary presumptions were, that it was paid, and consequently cancelled, or desti'oyed, though we prefer our decision to rest on the general rule.

4. Having thus disposed of the preliminary questions of evidence, we shall consider the rules W'hich must govern the cause on its merits. And, first, with resрect to the effect of the receipt offered in evidence. We think undue weight is given to this, by both parties, for each seems to consider it conclusive of the case. In our judgment, it belongs to that class of writings which is open to explanatiоn. We do not now speak of that explanation which all writings receive, from the circumstances surrounding, and attending their execution, or which arises out of the description of the parties to them; for we consider those matters as proрer in all cases; and as such they are held, by elementary writers on the subject of evidence. [Philips on Ev. 543; Wigram on Ex. Ev. 59; Gresley’s Eq. Ev. 201.] But we refer to that explanation, which may be given to terms of a doubtful, ambiguous, or double nature. That the notes described in the receipt, were to be collected, and that they might be returned, is very clear; but it is doubtful whether the last expression used — with interest from the time it was due — refers to the return of the money, by Hogan & Co., or to the amount which was to be collected from the notes of Graham and Me-Neil. It is upon the connection of this expression with the one or the other of these matters, that the prima facie force of the writing depends; for if those words refer to the payment of interest by Hogan & Co., it is difficult to resist the conclusiоn, that the parties contemplated a loan of ‍‌‌‌​​‌​​‌‌​‌‌‌​​‌‌‌​‌‌​​​‌​‌​‌​‌​‌​‌‌​​​‌‌‌‌‌‌​​‍the money, in the event of its collection; but if they refer merely to the amount to be> collected, then it is quite obvious they do not extend the meaning of what precedes them, and the reсeipt is one for collection only.

It would be strange indeed, if a writing of this description, which every one will admit to be so ambiguous, that it is difficult to determine what was really intended by it, should be incapable of explanation by extrinsic or parol evidеnce ; but the principle is well settled, that such evidence is admissible. Thus, if one promises to pay another a sum of money for counsel, it shall be intended to be for counsel in law, physic or otherwise, as the promisee may be of either of those, or other professions. [Powell on Con. 384.] So it has been held, where a bequest was made of a female slave and her increase, that extrinsic evidence wms admissible, to explain and apply the term increase, to those already born, or thosе to be so in future. [Reno’s Ex. v. Davis, 4 H. & M. 283.] The case of Cole v. Wendall, 8 John. 116, is very similar, in principle, to the one under consideration. There, one of the parties agreed to receive from the other, sixty shares of the stock of a certain bank, on which ten dollars per share had bеen paid, by the seller, and he was to receive.his note for #667, from the purchaser, who was to pay the remainder in cash, and an advance of five per cent. It was held, that parol evidence of the agreement between the parties wa sadmissible, to show, whether the term five per cent, advance, was applicable to the nominal amount of the shares, or the sum paid for them by the seller. These cases are entirely satisfactory, to show, that wherever language is used in a written instrument, which is capable of receiving two meanings, it is open to explanation, by parol or extrinsic evidence.

The terms made use of in this receipt, are not so clear as to authorize a Court to determine positively, and absolutely upon their meaning. We arrive thus at the conclusion, that this receipt may be explained, by extrinsic or parol evidence, so as to show what the parties intended by the doubtful terms.

5. But, however this instrument may be subject ‍‌‌‌​​‌​​‌‌​‌‌‌​​‌‌‌​‌‌​​​‌​‌​‌​‌​‌​‌‌​​​‌‌‌‌‌‌​​‍to explanаtion and control, by evidence aliunde, the question may arise as to its construction, in the event that no such evidence is given. It is a most salutary rule, and of as much force here as in any other case, that a written instrument is to be construed most strongly against the promissor ; and when he has made use of language of doubtful or double import, he will not be heard to complain, that it is taken in its strongest sense. So too, as the instrument is capable of two constructions, it should receive that which will bind all the firm, as it purрorts to do, instead of one which will bind a single partner only. Again, the rule is, that every part of an instrument shall receive such a construction, that none of it shall be rejected as insensible, if it is capable of meaning; and this cannot be applied to the last phrase of the receipt, without construing it to mean an engagement by the firm, to pay interest upon the sum of $1,750, (if collected from Graham and McNeil,) from the time it was due from them.

6. If, however, the evidence before the jury, satisfied them, thаt the doubtful phrase in the receipt, referred merely to the collection of interest from Graham and McNeil, then the question would have arisen, how far the firm was bound by the act of Hogan. It certainly is not within the ordinary scope of a partnership, created for the mere purpose of buying and selling merchandize, to receive, and undertake to collect, notes on other persons ; though we are not unaware that it is extensively the practice for commercial firms, in оne place, to send their demands to other firms, or houses, doing business near the residences of the debtors. How far the assent, or concurrence of all the members of the firm might be presumed, from the act or correspondence of one, in the name of the firm, is not here the question, and therefore calls for no consideration. Whatever the presumptions in such a case might be, it is evident they would not be the same where the party seeking the collection, resided in the same viсinage with the house to which these demands were committed, and when he possessed the same facilities for collecting them in person, or for transmitting them to others.

7. It is conceded that one partner may bind the firm, for money borrowed in the firm name; but the power is denied to borrow notes on other individuals. We will not discuss this point further than to say, that if there is a distinction between the borrowing of money, and notes, it does not apply, when the borrowed note is taken for the purpose of recеiving money upon it; and such is actually received. No one can suppose the giving a check upon a bank, or an order, or a draft upon a third person,is not aloanof money, when that is afterwards received; and we can pei’сeive no reasonable distinction between these cases, and the transfer of a note, followed by a similar payment.

8. It is doubtless true, that if one partner has converted money to his own use, and he afterwards appropriates the same sum to the purposes of the firm, the latter does not thereby become a debtor to him whose money has been converted; but such a state of facts is widely different from the case, where one partner, ‍‌‌‌​​‌​​‌‌​‌‌‌​​‌‌‌​‌‌​​​‌​‌​‌​‌​‌​‌‌​​​‌‌‌‌‌‌​​‍in the firm name, but without the actual authority of his partners, obtains money, and applies it to the use of the firm. The firm, in consequence of the defect of authority, might not be liable without the application of the money to firm purposes; but certainly becomes so, the instant the appropriation is made.

This summary of rules, will enable us to determine all the questions presented by the refusal to give the charges requested by the defendants, as well as the charge actually given. It is possible, that all the evidence before thе jury was not sufficient to destroy the prima facie intendments arising out of the receipt; but we cannot say there was no evidence to be considered in that connection. We cannot, therefore, coincide in the plaintiff’s view, that the charges asked аre wholly abstract. Without intending to be understood as having given a critical examination to all the instructions refused, we may remark, that the second, fourth, eighth, and ninth, seem to contain propositions entirely clear ; and therefore should have bеen given; but it would also have been proper to have accompanied them with such explanations, as would have prevented their generality from misleading the jury.

The first and fifth charges were properly refused, because the proрositions therein contained are not correct, when applied to the facts of this case; and the third, because it assumes the receipt to be one for collection only. The sixth, and seventh,were also properly refused, bеcause notin accordance with the rules deduced.

One error of the charge given to the jury is, that it leaves the •prima facie construction of the receipt to the jury, when the Court should have declared it; but this, in all probability, did not prejudice the defendаnts. Another is, that the appropriation by Hogan, of a part of the money collected to the use of the firm, made it liable for the whole amount; without drawing the distinction between the receipt as one for collection only, without ratification by the other partners, and as evidence of a loan of money. The last, and possibly the most important, is, that parol evidence is not admissible to explain the doubtful terms of the receipt; for such we understood to be the effect of the charge.

Let the judgment be reversed, and the cause remanded, that further ‍‌‌‌​​‌​​‌‌​‌‌‌​​‌‌‌​‌‌​​​‌​‌​‌​‌​‌​‌‌​​​‌‌‌‌‌‌​​‍proceedings may be had, in accordance with this opinion.

[Note. — This cause was decided at June Term, 1844, and should have been published in the 6th or 7th volume of Reports.]

Case Details

Case Name: Hogan & Co. v. Reynolds

Court Name: Supreme Court of Alabama

Date Published: Jan 15, 1845

Citation: 8 Ala. 59

Court Abbreviation: Ala.