127 Wash. 116 | Wash. | 1923
This action, against Henry C. Merriam Company, a corporation, is to recover a balance of $1,628.10, and an attorney’s fee due on a sixty-day promissory note of $5,000, dated March 26, 1920, payable to the plaintiff, signed “Henry C. Merriam Company by Charles B. Merriam, authorized agent.” The defense was that the note was made without authority to bind Henry C. Merriam Company, and that whatever sums were paid to the plaintiff on account of the note were paid without the knowledge or consent of the corporation. Findings of fact, conclusions and judgment were entered for the defendant, from which this appeal has been prosecuted.
"While the corporation was authorized to do business in this state, its home office was in Maine. The stock of the corporation from a time some years before the
Commencing in 1912, Charles B. Merriam acted as agent for the corporation under private instructions from one or more of the other directors as to all the more important transactions of the corporation in Spokane. From the early part of 1919 to July 10, 1920, the real estate firm of Fred B. Grinnell Company acted as agent in collecting rents from the tenants in the Merriam Building, during which period Charles B. Merriam continued to act as agent in other respects. He was provided with an office in the building, was paid a salary for his services, and was furnished a residence for himself and family at the expense of the corporation. In January, 1920, the building was damaged by fire, and Charles B. Merriam was instructed by the other directors to adjust the loss with the insurance companies, to make all necessary repairs, and pay for them out of the insurance money, but not to borrow any money for that purpose. These instructions were secret. He adjusted the loss of $4,098.41, and on January 29, 1920, deposited the money in the bank with which all his banking business, whether private or for the corporation, had been done, it being the same bank suggested by the other directors for that purpose. He caused the building to be repaired.
The arguments in this court have taken a wide range and several theories adopted for a reversal, contested by the respondent, but we think the judgment must be reversed under the rule that, having received the benefits of appellant’s money, the corporation will not be heard to say it is not liable under the circumstances of this case. The evidence shows that, at the time the insurance money was received, there was a balance in the bank in the Merriam account of only $18.22. On the same day the insurance money was paid, $4,504.10 was deposited, and on the same day, January 29, 1920, $4,000 of it was checked out. According to a written report made by Charles B. Merriam of the cost of repairs in the total sum of $2,140.54, nothing had been paid on the repair account, other than $80 at the time the insurance money was checked out. None of the
The evidence in the case shows that one payment of $1,133.35 on the note in suit was made by money furnished to Charles B. Merriam by his mother, who was the owner of about one-half of the stock of the corporation and who was advised of the Stilwell note al
There can be no question about the good faith of the appellant in making the loan, and we think it satisfactorily appears that the corporation has received the benefit of it to the extent its money was used to make payments on the note, together with the balance for which the recovery of judgment is now asked against it, and that the circumstances justify the application of the rule announced in McKinley v. Mineral Hill Consol. Min. Co., 46 Wash. 162, 89 Pac. 495, as follows:
“, . . . the evidence showed that the corporation had received the benefits by way of money loaned or advanced by respondent, and by way of his labor and services, which made the consideration for the note. Under such circumstances the corporation will not be heard to say that it neither authorized nor ratified the execution of the note. Allen v. Olympia Light & Power Co., 13 Wash.. 307, 43 Pac. 55; Kirwin v. Washington Match Co., 37 Wash. 285, 79 Pac. 928.”