40 Neb. 501 | Neb. | 1894
The'plaintiff in error sued the defendant in error, a national bank, alleging that on January 21, 1889, one EIsmore and one Knowlton made and delivered to Charles H. Paul certain promissory notes secured by real estate mortgage of the same date; that Paul in the ordinary course of business indorsed and delivered the notes to the bank; that the bank executed and delivered to plaintiff a guaranty as follows:
“ For value received, we hereby assign and transfer the within note .to Joseph Thomas, trustee, and guaranty payment of the principal and interest on the same on the terms alud conditions stipulated in the mortgage of even date securing the same.
“[seal.] City National-Bank,
Hastings, Nebr.;
“By H. Bostwick, PC’
That the foregoing contract was written upon each of said notes, and that plaintiff relying thereon and on the
The evidence on the part of the plaintiff tended to show that the notes and mortgage were made and delivered to Paul in payment for an interest in a brick yard; that Paul was then indebted to the bank in the sum of about $7,000, $5,000 of which seems- to have grown out of the brick yard business, but constituted a debt which Paul testifies he liad individually assumed. Bostwick, the president of the bank, took the notes and mortgage, Paul having indorsed the notes, and sold them to the plaintiff, writing the .guaranty thereon before their transmission. The payment was made by two drafts of the National Bank of Com
“Pay to the American Exchange Bank, New York, or order, for collection account of City National Bank, Hastings, Nebraska. J. M. Ferguson,
“ Cashier.”
Ferguson was cashier of the- defendant bank. He testifies he did not place the indorsement upon the drafts, and that he never saw them before the trial, but that it was not his duty to make such indorsements; that they were generally made by the remittance clerk. The drafts were paid, and from the proceeds Paul’s debt to the bank was canceled and the remainder passed to his credit. The method of bookkeeping pursued in order to accomplish this result is left doubtful by the evidence; but the evidence is uncontradicted that this result was reached. Subsequently one note of the series was paid plaintiff in a draft through the City . National Bank. A letter signed by Bostwick, indicating that the bank paid it, was excluded from evidence.
The theory of the plaintiff is that the guaranty was within the scope of the bank’s authority and that of the president; but if not so, plaintiff having adopted the benefit of the transaction by receiving the proceeds in satisfaction of Paul’s debt, Bostwick’s acts were ratified. The theory of the defendant is that the arrangement was a scheme between Bostwick, the makers, and the payee of the notes, constituting the brick company, to obtain money; that the bank never owned the notes, and that the president’s act was not within the scope of his authority, but amounted to a forgery committed by him while acting individually, and that the guaranty was in any event a pledge of the bank’s credit and ultra vires.
From Rich v. State Nat. Ranh of Lincoln, 7 Neb., 201, we-quote the following: .“As a [general] rule, the officers of
In People's Bank v. National Bank, 101 U. S., 181, one Pickett made his notes for $50,000, payable to his own order, indorsed them and delivered them to the National Bank to be negotiated to the plaintiff. The vice president of the National Bank, with the knowledge and consent of the president and cashier, but without any. authority from the board of directors, or from a majority of them as individuals, transmitted the notes to the plaintiff with a written guaranty signed by himself. The plaintiff’s account with the defendant was debited with $50,000 on account of the notes. At the same time Pickett’s paper held by the defendant was canceled to the same amount. It will be observed that in all its essential features this ease was similar to the one under consideration according to plaintiff’s theory of the facts. The language of Mr. Justice Swayne in that case is therefore entirely appropriate to this and, so far as it concerns the law of the case, we quote it entire in lieu of an original discussion: “The national banking act (Rev. Stats., 999, sec. 5136) gives to every bank created under it the right ‘to exercise by its board of directors, or duly authorized agents, all such incidental powers as shall be necessary to carry on the business of banking, by discounting and negotiating promissory notes, drafts, bills of exchange, and other evidences of debt, by receiving deposits,’ etc. Nothing in the act explains or qualifies the terms italicized. To hand over with an indorsement and guaranty is one of the commonest modes of transferring the securi
The errors assigned relate to the admission and exclusion of evidence and to the giving and refusal of instructions. Some are not assigned with sufficient definiteness to permit a review. In ruling upon the evidence the trial court seems to have proceeded upon the theory that the plaintiff had no right.to rely upon the apparent authority of Bost
Reversed and remanded.