Lake Shore National Bank v. Butler Colliery Co.

We have reached the conclusion that notice of the demand, non-payment and protest of the Eleinora B. Grant note was not duly served so as to charge the defendant as endorser for reasons hereinafter stated. Upon the facts as found by the referee and set forth in his. decision, the legal conclusion that the defendant is liable as endorser upon each of the other notes is well supported. The evidence as set forth in the case tends to support each fact which it was necessary for the plaintiff to maintain to establish the defendant’s liability as endorser upon each of those notes. The referee has not made a certificate that the case, as settled by him, contains all the evidence produced on the trial, therefore on this appeal this court cannot look into the evidence for the purpose of determining the point made by the appellant that some of the material findings df fact are against the weight of evidence. We can only review the questions of law presented by the exceptions. Porter v. Smith, 107 N. Y., 531 ; 12 N. Y. State Rep., 479; Spence v. Chambers, 39 Hun, 193 .

' The makers of the several promissory notes were debtors of the defendant, and the consideration for each note was their respective indebtedness to the company. The business of the company, carried on at Buffalo by the defendant was legitimate and within the powers conferred upon it by its charter. This business was conducted by Hubbell, as the company’s agent, duly appointed to conduct that branch of its operation. He was in sole charge of the same at that place, and the transactions were of considerablé magnitude and extended through a period of years.The indorsements of the notes in suit were made during the latter part of Hubbell’s agency. The notes were .dated at Buffalo and made payable to the order of E. S. Hubbell, agent, at E. S. Hubbell’s office, 421 Hamburg street. . Theindorsement was as follows: “ E. S. Hubbell, agent for Buffalo Colliery Company.” Before the notes in suit were made and discounted, Hubbell had been in the habit of iecéiving from the defendant’s customers doing business with him as agent, notes in form similar to those in suit, which he indorsed and procured to be discounted by banks doing business in the city of Buffalo, and at the plaintiff’s báak, the proceeds of which were remitted to the defendant’s chief office at Elmira, which was under the immediate superintendence- of the president and directors of the company.

These facts found by the referee show conclusively that the indorsements made by Hubbell, as the agent of the company, and the form of the indorsements made the samé the act of the company.

The manner in which agents of corporations must execute contracts, in order to avoid personal liability, and to bind their principals, the general principle is the same as with the agents of natural persons; and, in general, if from the contract itself, or from the contract, coupled with the conduct of the parties thereto, it appears that credit was given, not to the agent, but to the corporation, and that it was the intent of the parties that the corporation should be bound, whatever may be the particular form of the contract, the corporation is. alone liable upon it. Angelí and Ames on Corporations, 288.

The rule is illustrated as the same is applied in the case of Exchange Nat. Bank v. Monteath ( 17 Barb., 171 , which was affirmed in the court of appeals, 26 N. Y., 505 ). In that case the defendants were co-partners, doing business under the name of the Albany and Canal Line of Tow Boats, and Thaddeus Joy and George Monteath transacted the business of the company at Albany, in the name of ‘ Joy & Monteath, agents,” etc., and Albert Hoyt was their agent in the city of New York. Joy drew drafts upon the New York agent, which were signed “ Joy & Monteath, agents Albany and Canal Line of Tow Boats,” payable to their own order and addressed to and accepted by Albert Hoyt, agent.

They were also endorsed by Joy, in the name of ‘‘Joy & Monteath, agents,” and the drafts were discounted by the plaintiff. It was held that the act of Joy & Monteath, in issuing the drafts under the circumstances mentioned, was binding on their principals for which they acted, and that the drafts in form in which they were issued was the undertaking of the company. In that case it was admitted that Joy & Monteath were authorized to draw and accept drafts for their principals, and in the case at bar, Hubbell’s authority to endorse notes for the company was established by the proofs. In view of the nature of the business carried on by the defendant in Buffalo, by Hubbell, as its agent, and the facts found by the referee and set forth in his report, the form of the indorsement was merely a convenient mode adopted by the agents with consent of the principal, and thus the form of the indorsement became the

The learned counsel for the appellant has cited several cases, and among them Dewitt v. Walton ( 9 N. Y., 572 ), in support of his contention that the indorsement bound the agent personally, and not the company. In that case there was an absence, as the court held, of proof indicating any consent or authorization by the principal that his agents might make notes in his behalf and in his business in the form adopted in that case, but the rule was distinctly affirmed that if the principal had adopted the name' used as his business designation, he could, himself, make contracts in that name, and could authorize his agent to contract for him in the same manner, and Brown v. The Butchers’ and Drovers’ Bank ( 6 Hill, 443 ), was cited in support of the decision.- The case of Moss v. Livingstone ( 4 N. Y., 208 ), where it was held that the acceptance of the draft in suit was the acceptance of the agent and not of his principal, and placed upon the same grounds as those stated in Dewitt v. Walton.

As to the service of notice of protest on the Eleinora B. Grant note, the - referee has made special findings of fact and from them it is to be determined whether the referee’s legal conclusions can be supported, that they were sufficient to charge the defendant as indorser.

In the body of this report it is stated as a fact “that notice of such presentation for payment, demand of payment, and that the said maker neglected to pay the same was given to said Hubbell as said agent.” At the request of the defendant the referee made a further finding on the same subject, which is as follows: “The notice of the protest on the Eleinora B. Grant note was addressed ‘ E. S. Hubbell, Agt., Butler Colliery Company.’ No place of address is given. This is the only notice of protest of that note.” It should be mentioned in this connection that the agent Hubbell indorsed the note individually after the indorsement by the company. The notary’s certificate was read in evidence by the plaintiff, and it is stated therein that the note was protested on the day it fell due and notice to the maker of the note was served on the same day. He also testifies that he deposited in the postoffice at the city of Búffalo, and paid the legal postage thereon, due notice of the demand, non-payment and protest, partly written and partly printed, signed by him and folded in the form of letters as follows, viz.: “Notice for Eleinora B. Grant, directed Buffalo, N.Y.; notice for E. S. Hubbell, directed Buffalo, N. Y.;. notice for E. S. Hubbell, Agt., for Butler Colliery Co., enclosed to E. S. Hubbell.”

The counsel for the appellant, in his printed points, admits that it does appear on the face of the certificate made

As we construe the special finding, it is stated as a fact that the notice of protest for Hubbell, as agent for the Butler Colliery Company, was enclosed in an envelope addressed to E. S. Hubbell, without any findings as to the place of address or in what postoffice deposited. If it could, be fairly held that the notice for Hubbell as agent was enclosed in a letter directed to E. S. Hubbell, which contained the notice addressed to him personally then we think that would have been a good service, for the law presumes that the letter was received by Hubbell, and if it contains the notice addressed to him as agent, that would have been a good service, for he had authority to receive for his. principal notice of the dishonor of commercial paper. Daniels on Negotiable Instruments, vol. 2, p. 52, § 998; Bank of Auburn v. Putnam, 3 Keyes, 343; Fassin v. Hubbard, 55 N. Y., 465 ; Firth v. Thrush, 8 Barn. & Cres., 387.

But the special findings of fact made by the referee control the general finding on the same subject and by them it is stated, that in the notice of protest to Hubbell as ageht, no place of address was given; and the service of notice was therefore incomplete, and it must be held as-matter of law that the defendant was not charged as indorser on that note.

The point made that it appears by the evidence that Hub-bell had been discharged and ceased to be agent when two of the notes in question, were protested,, and that Mr. Coleman, president of the bank, was notified of the fact and for' that reason service of notice on Hubbell was insufficient, is not supported by the evidence.

Another point made by the appellant is, that long before the notes in suit were made, the company had ceased to do business in Buffalo and at that time Hubbell was in fact acting for other parties. There is some evidence tending to show that before the notes in suit were executed, the defendant had ceased to do business in Buffalo, and that the same, kind of business was carried on by firms composed of persons who were stockholders and officers of the corporation, who did their business in the name of “ the Butler Colliery Company,” being the name exactly the same as the corporate name of the defendant, and that Hubbell acted as their agent and not the agent of the company. This evidence presented a question of fact, and there was much evidence the other way, which tends to support the conclusion of the referee, that Hubbell was the agent of the defendant at the time the notes in suit were made, and we are not at liberty to examine the proofs with a view of determining whether the finding of the referee, as contained in his report, is contrary to the evidence as claimed by the appellant.

The exceptions taken by the appellant to the reception of

Judgment reversed and new trial granted before another referee, unless the plaintiff stipulates within thirty days to deduct from the judgment the amount of the Eleinora B. Grant note and interest, and if such stipulation. is served, then the judgment as modified is affirmed, without costs of this appeal, to either party.

All concur.