5 N.Y.S. 291 | N.Y. Sup. Ct. | 1889
The action was to recover the amount of 13 promissory notes discounted for the account, as is alleged, of the defendant, on the indorsement of the latter by an agent duly authorized thereto; also the amount of a small overdraft of the same account, made by the agent, and paid to the defendant. The plaintiff is a banking corporation under the laws of this state, and the defendant a mining corporation organized under the laws of Pennsylvania, having its principal financial and business office at Elmira, in this state. Eli S. Hubbell was, on the 12th day of July, 1881, the agent of the defendant at Buffalo. The agent and the business were introduced to the plaintiff on the day last named by a letter, of which the following is a copy.
“The Butler Colliery Company.
Elmira, N. Y, July 12, 1881.
“S. M. Clement, Esq., President—Dear Sir: This is to inform you that E. S. Hubbell is the authorized agent of the Butler Colliery Company for the sale of its coal at Buffalo, H. Y. Any paper he may take for coal sold for said company he is authorized to indorse as the agent of said company, and get it discounted at your (the Marine) bank, and that any and all such paper so indorsed which you may discount for him the said company will see paid.
“Yours, truly, E°. C. Dinninny, President.”
The writer of the letter was the president of the defendant, elected in 1877, and continued in that office without re-election down to the time of the commencement of this action; there having been no election of officers since 1877, and no meeting of directors since 1879. He was during all that time the actual manager of the business of the defendant, and, with the nominal treasurer of the corporation, owned all its stock, except a few shares held by persons employed in the office of the defendant, sufficient to qualify them for directors, and thus to make and maintain a corporate organization. As president he drew the drafts, and indorsed the checks and other commercial paper of the defendant, and directed all the financial affairs of the corporation, with
Upon these facts, found upon undisputed evidence, we cannot doubt the correctness of the conclusion of the referee, which awards a, recovery to the plaintiff. The notes were evidently discounted by the plaintiff, relying upon the apparent authority of Hubbell, the agent, to indorse them for the defendant. The letter of July, 1881, gave the plaintiff notice of Hubbell’s authority, as agent of the defendant, to sell its coal at Buffalo, to take notes for coal sold, to indorse such notes for the defendant, and to procure their discount at the plaintiff’s bank. The authority of Dinninny to write the letter, and to bind the defendant thereby, is clearly established by the undisputed evidence of the manner in which the business of the corporation was conducted. During all the years covered by the transactions in question the president of the corporation was permitted to be, and to hold himself out to the world as being, the general ■manager and director of its business. The act in question was within the
The same principles apply to support the disallowance by the referee of the counter-claim of the defendant for moneys received by the plaintiff from the defendant’s agent, and afterwards drawn out, and, as is alleged, misappropriated by him. The authority of the agent to open and maintain the account with the plaintiff, and to draw against it for the purposes of his agency, being estabbed by the letter of authority, and the course of dealing between the parties, the plaintiff, in the absence of notice to the contrary, or of facts to put it upon inquiry, had the right to assume that the acts of the agent in this connection were what they purported to be, viz., in the execution of his power as agent. The plaintiff was therefore entitled to credit for all moneys drawn by the agent in the ordinary course of the business, and apparently within the scope of his authority as agent. It is unnecessary to employ any reasoning to maintain the proposition that no revocation of the authority of the agent nor change in the personnel of the principal could affect the dealings between the agent and plaintiff until notice of the change or revocation was brought home to the latter. In all those respects we must regard the findings of the referee as well supported by the evidence, and his conclusions of law as. well grounded upon the facts so found.
There was an item of counter-claim of $150.10, for coal sold to the plaintiff, established by evidence, and not controverted by the plaintiff. It was apparently overlooked by the referee, and the plaintiff now concedes that the judgment should be modified by its allowance. That modification being made, the judgment as modified should be affirmed, with costs. All concur. Judgment modified by deducting therefiom the sum of $150.10, with interest thereon from the date of the report, and, as so modified, affirmed, with costs.