Everett v. United States

6 Port. 166

• Court: Supreme Court of Alabama
• Decided: June 15, 1837
• Status: Published

Opinion

COLLIEN, C. J.

The defendant in error brought assumpsit on a promissory note, dated the tenth day of March, eighteen hundred and twenty, against the plaintiffs — by which George Fisher, as principal, and the plaintiffs, as his sureties, promised to pay to the President, Directors and Company of the Tombeck-bee Bank, the sum of five thousand one hundred and sixty-two dollars and fifty cents, ninety days after date.

There were two bills of exception taken "on the trial. The first states it to have been proved that the note was indorsed, by J ohn B. Hazard, the cashier of the hank, to the defendant. To this evidence the plaintiffs objected, as insufficient to pass the title in the note, and insisted that there should appear an authority, to the cashier, to make the transfer. But the objection was overruled.

It also appeared, from the first bill of exceptions, that Fisher proposed to the Bank, after the maturity of his note, to transfer certain lands and land certificates to its proper officers, if the time of payment was extended, so as to allow him to discharge it in eight annual instalments — to which the President, &c. of the bank, assented, on terms which were not shewn to have been communicated to Fisher. Evidence was, however, “offered, tending to shew that George 8, Gaines received from said Fisher a transfer of lands, and land certificates, under his said proposition, and at the time of such transfer, he gave the said Fisher an instrument, a copy of which is hereto attached, marked C. Evidence was offered to shew a sale of the said lands, under the directions of the said Bank, and a receipt by them, of the proceeds of the sale, before the assignment to the plaintiffs.”

A letter of Fisher, dated the first of October, eighteen hundred and twenty-four, accompanying the bill of exceptions, was read to the jury, for the purpose of avoiding the effect of the statute of limitations, which was pleaded by the plaintiffs. This letter was held, by the Circuit court, to be good evidence for that purpose.

The counsel for the plaintiff, (defendant here,) having insisted in argument before the jury, that they might, and should infer the assent of the defendants, to conditions imposed by the bank, as set out in B, from the fact that the arrangement was completed by Fisher, with Gaines, the cashier. The defendants (plaintiffs here,) requested the court to instruct the jury, that no assent of theirs could be inferred from the acts of the said Bank, its officers, or the said George Fisher; that the^ defendants, could be alone bound by their own acts or admissions. Which charge the court refused to give as asked for — but charged the jury, that some act or admission of the defendants would be necessary to bind them ; but that the said resolution, or minute of the Board of Directors of said Bank, marked B, was before them, and that it was competent for the jury to infer from the same, the assent of the said defendants, to the arrangement proposed and contemplated between Fisher and the Bank ; but that they were not compelled to draw such an inference, nor was the same conclusive — but that they could draw such an inference, if they thought propci'. To which refusal to charge, and. charge as given, the defendants except,” &c.

The paper marked B, referred to above, is part of the bill of exceptions, and is as follows:

“ Friday, 7th September 1821 — the board*of director’s met. Present, William Crawford, President, Bu-channan, Malone, Ross, Lyon, Pickens, B. S. Smoot.— Col. Fisher’s new proposition was laid before the board, and it was agreed, that on condition of his securities’ consenting to the arrangement proposed, that the President and Cashier be authorised to enter into it, and conduct it to the best advantage in their power, for the interest of the bank.”

The second bill of exceptions was abandoned by the plaintiffs in error, at the argument.

The questions of law arising upon so much of the ■first bill of exceptions, as relates to proof, in avoidance of the statute of limitations, and the charge of the court thereon, were not insisted on by the plaintiffs, in argument. We, therefore, decline considering them, now — leaving them to be determined, when they shall hereafter arise.

The questions proposed to be considered, are—

1. Did the indorsement of the note in question pass the right of action thereon, to the defendant in error 1

2. Can the assent of the plaintiffs in error, to the arrangement between Fisher, the principal debtor, and the President, &e. of the Bank, for an extension of the time of payment, be inferred 'from the acts of the officers of the bank, alone ?

1. The act incorporating the Tombeckbee Bank, invests “the President, Directors and Company” of that institution, with power, “ to ordain, establish, and put in execution, such by-laws, ordinances and regu \ lations, &c., as they may deem necessary and expedí 1 exit for the good government of the said corporation,” &c. It also provides for the appointment of a cashier, or other officers.

*

'The right of the cashier to transfer the negotiable paper of the bank, depends upon the extent of his powers, as defined by the “by-laws, ordinances and regulations,” of its “ President, Directors and Company or else upon the duties which devolve upon that officer, resulting from the nature of his situation. Jf he be an agent, as most clearly he is, his authority is to be ascertained by the character of his agency; for, when this is determined, we have no difficulty in deducing from thence, his powers, — the law always implying the delegation of such as are within the sco|3e of his employment.

In Fleckner vs The United States Bank,† Mr Justice Story, in delivering the opinion of the court, remarks, “ The cashier is usually intrusted with all the funds of the bank, in cash, notes, bills, &c., to be used from time to time, for the ordinary, and extraordinary cxi- • gencies of the bank. He receives directly, or through the subordinate officers, all moneys and notes. Pie delivers up all discounted notes and other property, when payments have been duly made. He draws checks from time to time, for moneys, wherever the bank has deposits. In short, he is considered the executive officer, through whom, and by whom, the whole moneyed operations of the bank, in paying or receiving debts, or discharging or transferring securities, are to be conducted. It does not seem too much, then, to infer, in the absence of all positive restrictions, that it is his duty, as well to apply the negotiable funds, as the moneyed capital of the bank, to discharge its debts and obligations.” Here is a clear recognition of the right of a cashier, in the course of his ordinary duties to transfer the paper securities of the bank, in payment of its debts.

In the case at bar, it is true, that the inducement to the indorsement by the cashier, does not appear, nor is it considered important that it should. The right being-clear, even without a previously expressed authority (as one implied from the nature of his office) we cannot suppose, without proof, that the cashier abused his powers by improperly transferring the credits of the bank; but must intend that the act was done for some legitimate ¡Durpose. And in the casG already cited, the court remark, that “ the acts of the cashier, done in the ordinary course of the business, actually confided to such an officer, may well be deemed prima facie evidence that they fell within the scope of his duty.

In Fleckner vs the United States Bank, the court need not have placed their judgment upon the nature of the office of a cashier, or the ptowers incident to it; for in that case, there, was a subsequent recognition of his authority. Yet both grounds are taken, and the reasoning enrployed, we think, is very satisfactory to sustain the first.

But was this question res integra, to be settled with reference to the analogies of the law only, our conclusion would be favorable to the legality of the in-dorsement of the cashier, for the reason that such an act was within the scope of the powers ordinarily-conferred upon that officer. - This inference, however, would not be conclusive, and it would still be competent for the party sued, to controvert the fairness of the transfer, by shewing that it was not made in the regular course of business, but in prejudice of the rights and interests of' the bank. Where this is the case, no title could pass to the assignee, and consequently no action could be maintained by him.

In examining this question, we have not thought it necessary, to consider hoio far a common seal may be necessary, to authenticate the acts of a corporation. It is clear that the ancient strictness upon this point has been greatly broken in upon, by a more enlightened current of modern decisions.—Vide The Bank of Columbia vs Patterson ;* The Mechanics’ Bank of Alexandria vs the Bank of Columbia;† Fleckner vs The United States Bank.‡ From these authorities, it will sufficiently appear, that though a coloration must, in general, act through its common seal, yet it may appoint an agent, whose acts, within the sphere of his powers, do not require any such appendage, to impart to them -validity.

2. It is a rule of very general, if not universal application, that no one can be bound by the acts and admissions of another, over whom he has exerted no control; and if to this rule there can be any exception, the charge asked, and that given by the judge to the jury, furnish, in themselves, no reason why we should thus regard this case.

There is not the slightest evidence that the plaintiffs were advised that time had been given to Fisher, their principal, yet the jury are instructed, in substance, that a knowledge of such an arrangement by the plaintiffs, as well as their assent to it may be inferred from the “ resolution or minute of the brard of directors of said bank, marked B.” With equal justice might the operation of the statute of limitations be counteracted, by inferring that the creditor would never have suffered the statute bar to run, had not the debtor acknowledged the debt, so as to prevent it from becoming effectual. In principle, there is no difference between the case stated in the charge to the jury, and that we have supposed — and the principle is this, that where a demand once incurred, is discharged by the negligence or positive acts of the creditor, a jury may infer from his subsequent acts or omissions, incompatible with the idea of a discharge, that the liability is still continuing. The principle maintained in the instruction to the jury, needs but to be simplified, to induce its rejection.

Had the plaintiffs been informed of the arrangement between the Bank and Fisher, without objection, such evidence might with propriety have been left to the jury, as authorizing the inference, (if unexplained in any manner) that it had received their assent ; but the record does not inform us, that such pi'oof was offered.

The defendant’s counsel, in his argument, attempted to shew, that the charge to the jury was upon an abstract question, — that by the resolution or minute of the Board of Directors, the President and Cashier of the Bank, jointly, were authorized to make the arrangement with Fisher, — that George S. Gaines alone acted, and that there was no proof that he was either President or Cashier. Without pretending to examine, whether it is necessary for all persons to whom a power is given, to unite in its execution, we are persuaded that the question does not arise in this case. The bill of exceptions informs us, that George S. Gaines received of Fisher, a transfer of lands and land certificates under his proposition, and that “ evidence was offered to shew a sale of the said lands under the directions of the said Bank, and a receipt by them, of the proceeds of the sale, before the assignment to the plaintiffs.” (Now defendant.)

Here was an approval of the agency of Gaines, which is well settled to be equivalent to a previously delegated authority. — (Fleckner vs U. S. Bank.) So that it is quite immaterial whether he was either President or Cashier.

For the reason then, that there was no evidence of the plaintiffs’ assent to an extension of the time of payment, given by the Bank to Fisher-, the judgment is reversed, and the cause remanded.

GOLDTHWAITE, J. not sitting in this case.

iToulffjift’s Digest 41-?.

8 Wheat. 3£8.

7 Cranch, 299.

5 Wheat. 326.

8 Wheat. 358.