Strachan v. Muxlow

| Wis. | Feb 15, 1869

PAlins, J.

The defendant’s counsel does not contest the proposition that, where an agent employed to sell property receives securities and transmits them to his principal, his implied authority to receive payment on those securities ceases with his possession; and, if the debtor seeks to bind the principal by a payment to such agent, he must prove something beyond the mere original agency to sell the property and receive and transmit the securities. The defendant attempted to comply with this requirement, by proving that it was a part of the agreement, at the time the note sued on was given, that he might pay it at any time to Champlin, at Darling-ton. And he was allowed to give evidence, under objection, of a parol agreement or conversation between him and Champlin to that effect, at the time of the giving of the note. The defendant said that he told Champlin he wanted the privilege of paying his notes at any time, and that Champlin told him they might be paid at any time to him.

If such a conversation is to be understood as constituting a part of, or condition to, the agreement, then the evidence was inadmissible, for the reason that it contradicted the notes. They were payable to the plaintiff, or his order, one in three and the other in fifteen months, with interest. I take it for granted that the defendant, in stipulating for the privilege of paying his notes at any time, meant to secure the right to stop the interest, by paying it to the time of the payment. And this was in direct contravention of the right secured to the plaintiff by the written contracts, to have his debt at interest for the times specified in the notes. However, upon this branch of the parol agreement, no question arises, as there was no payment before maturity.

But the other branch of it was equally in conflict with the notes. By them the defendant expressly promised to pay to John Strachan, or his order. By the parol agreement, he seeks to authorize himself to pay to somebody else. In saying this, I do not overlook the fact that a payment to an authorized agent of Strachan would be a payment to him within the meaning of the note. But the plaintiff testified that, before this payment, Champlin’s authority had ceased. Certainly it might have ceased. It might be revoked at any time. And this’the defendant was bound to know. The right, therefore, do pay a note drawn payable to a particular person or order to some other person, without reference to the question- whether such other should be the agent of the payee at the time, is a material addition to, and contradiction of, the note itself. And it cannot be established by a contemporaneous parol agreement.

The defendant also sought to show a course of dealing by which the plaintiff had held Champlin out to the world as authorized to receive payment on Ms notes, whether they were actually in Champlin’s possession or not. Only-two instances were relied on. But the case of Schwartz has no' tendency to support such a conclusion ; for he refused to pay to Champlin until the latter got possession of the note. It leaves, therefore, but a single instance in’which money due the plaintiff on a note was deposited with Champlin by the maker, and the note was afterward procured by Champlin from the plaintiff and delivered. And it did not appear that tMs fact ever came to the knowledge of the defendant before making his payment. It is very doubtful whether a verdict for the defendant ought to be sustained upon such evidence. It is not clear that the transaction itself imported any recognition of Champlin’s authority to bind the plaintiff by the receipt of money prior to Ms actually getting the note. Suppose one person owing another on a note should deposit the amount in a bank, with directions to inform the holder and procure the note from him, paying the money upon it. If the holder, on receiving the information from the bank, should forward Ms note and receive the money, would that constitute the bank Ms agent, so that if any other debtor should pay his note to the bank he would be discharged, though the creditor never parted with the security, and the bank failed without paying over the money ? It is at least extremely doubtful. The question is, whether, in any such case, the debtor does not make the depositary Ms agent until the security comes to Ms hands ? After that, he might be the agent of the creditor for tire purpose of delivering the security and forwarding the money.

But even if the transaction did import a recognition of Champlin’s authority to receive the money, it is doubtful whether a single act not known to the defendant would constitute such a “holding out to the world” as would relieve the defendant from proving actual authority.

But as the evidence may be different upon another trial, we shall^not express any final opinion upon these points.

For the admission of the improper evidence the judgment must be reversed, and a venire de novo awarded.

By the Court. — Ordered accordingly.