National Spraker Bank v. George C. Treadwell Co.

Majority

p. 77

NATIONAL SPRAKER BANK v. GEORGE C. TREADWELL CO.

(Supreme Court, General Term, Second Department.

July 27, 1894.)

Headnote

Corporations—Execution op Note.

The fact that a note was made by the president of a corporation, and was not signed by the treasurer in accordance with the by-laws, constitutes no defense to an action against the corporation where the note was not diverted from its original purpose, but went into the hands of a bona fide holder, and the corporation received the benefit of the proceeds.

Appeal from circuit court, Kings county.

Action by the National Spraker Bank of Canajoharie against the George G. Treadwell Company on a promissory note. From a judgment entered on a verdict in favor of plaintiff, and from an order denying a motion for a new trial, defendant appeals. Affirmed.

Argued before BROWN, P. J., and DYKMAN and CULLEN, JJ.

Edward F. O’Dwyer, for appellant.

William. G. Cooke, for respondent.

This is an action upon a promissory note, of which the following is a copy:

“Albany, N. Y., March 10,1893.

“Five months after date, we promise to pay to the order of Geo. H. Tread-well five thousand 00/100 dollars, at Hotchkiss & Co.’s Banking House, 31-33 Broadway, New York, without defalcation, for value received.

“$5,000.00/100. Geo. C. Treadwell Co.

“Geo. H. Treadwell, President.”

The note was indorsed by George H. Treadwell and Hotchkiss & Co. The defense consisted of a denial of the making of the note by the company, but that did not signify that the note was not made by the president, but was based upon the theory that the president was destitute of authority to execute the paper. It appeared from the evidence that the note was made and delivered to the plaintiff in renewal of a former note of the same party, which had been discounted by the plaintiff. When, therefore, the paper was produced by the plaintiff upon the trial, and proven, as it was, a case was made which required an answer. The fact that the paper was made by the president of the corporation, and was not signed by the treasurer, in accordance with the by-laws of the company, constitutes no defense. The paper was not diverted from its original purpose, but went into the hands of a bona fide holder, and the company received benefit of the proceeds. The defense failed, and, as there was no disputed question of fact, the court properly directed a verdict for the plaintiff. The judgment should be affirmed, with costs. AE concur.