Washington Mutual Fire Insurance v. St. Mary's Seminary

52 Mo. 480

• Court: Supreme Court of Missouri
• Decided: March 15, 1873
• Status: Published

Opinion

Sherwood, Judge,

delivered the opinion of the court.

Action in the St. Louis Circuit Court by the Washington Fire Insurance Company to recover from St. Mary’s Seminary a certain sum for assessments made by tlio former on a premium or deposit note, which the defendant was in the petition charged with having- executed. The answer was a general, as well as a very lengthy and specific, denial of each and every allegation which the petition contained. It denied ever having made any application to plaintiff for insurance; denied that any application of defendant to plaintiff for insurance was signed by Daniel McCarthy, President of defendant, per Thomas Burke, the agent of defendant; denied the delivery by plaintiff to defendant of its Policy of Insurance; denied the execution by defendant to plaintiff of its certain premium deposit note mentioned in the petition; denied that any note executed by defendant was filed with the petition; denied that any note executed or delivered by defendant to plaintiff was signed by Daniel McCarthy, President, per Thomas Burke ; denied that McCarthy & Burke were authorized agents of the defendant to make any such application or to execute any premium note, &c., &c.

The note mentioned in and filed with the petition is in this from.

“ §750. For value received in Policy No. 2969,dated the fourteenth day of March, 1866, issued by the Washingtion Mutual Fire Insurance Company of St. Louis, I promise to pay said company (or their Secretary for the time being) the sum of seven hundred and fifty dollars, in such portions and at such time or times as the directors of said Company may, agreeably to their Acts of Incorporation, require.

Daniel McCarthy, President,

per Thomas Burke. ”

and indorsed on said note are these words No, 2969-$750. Received 10 per centum, $75, and Received Assessment, No. 5, $75

'The trial was had before the court, a jury being waived.

The application mentioned in and annexed to .the petition, was designated in said application as, “Application of Daniel McCarthy, President of St. Mary’s Seminary,” and was signed in the same manner as the premium note above referred to. The Policy of Insurance was of the same date and number as the note and application (both of which are referred to in tho policy), and purports to “Insure Mr. Daniel McCarthy, President of St. Mary’s Seminary, against loss or damage by fire to the amount of $5000, as follows, viz:

On the Brick Seminary Building $2500.

“ “ Stone Church Building ■ 2500.

tJptJUv V»

“ Situated in Perry County, Missouri, near Perry ville; $22,-500 on Seminary, and $12.500 on Church, insured elsewhere.”

The evidence showed, that by the terms of the charter of defendant, it was placed in charge of three officers, “'Superior, Assistant Superior, and Procurator,” that at the time the note above mentioned was signed by Thomas Burke, Daniel McCarty was the incumbent of two of those offices; Procurator or Treasurer and Acting Superior or President. And the evidence, although conflicting, tended very strongly to show that Daniel McCarthy, either by acts of antecedent authorization or eise of subsequent recognition, had empowered Burke to make the application for insurance, sign the note in the way it was signed, procure and transmit the policy and pay assessments.

Defendant objected to the introduction of both the note and policy in evidence, on the ground that the former was not and did not purport to be the note of the defendant, and that the latter was not, and did not purport to he, a policy issued to or insuring defendant. The court allowed both note and policy to he read in evidence, and defendant excepted.

The court at the instance of plaintiff gave the following instructions :

1. “If the Court believes from the evidence, that defendant through its President or Superior recognized the note sued on as the note of the defendant, by paying a portion thereof after demand upon defendant by notice to President or Superior, and that a portion of said note is now due, the court will _ find for plaintiff.

2. The court declares the law to be, that the act of a person for another acting as his agent may be valid and binding upon the principal, on account of the ratification or adoption of the agent’s acts after knowledge by the principal of what the person acting as agent has done. A subsequent ratification has a retrospective effect and is equivalent to a prior command.”

And at defendant’s request gave instructions as follows:

1. “-The court declares the law to he, that Daniel McCarthy had no authority to hind defendant by the Contract of Insurance offered in evidence, or the note sued on, from the fact that beheld the office of President of defendant; and plaintiff, in order to recover in this action, must prove that said McCarthy bad authority from defendant to execute said note, by evidence other than that the said McCarthy held said office of President of defendant.

2. “ The court declares the law to be, that any instructions given by Stephen Nyan to Father Burke in reference to effecting insurance are not binding upon defendant.

3. “ The court declares the law to be, that if Tilomas Burke, at the time he made the contract of insurance given in evidence and executed the note sued on, acted as the agent of Daniel McCarthy, and not as the agent of the defendant, then no subsequent action of defendant could ratify said contract or the execution of said note, or make them binding upon defendant.”

4. “ Tlie court declares tlie law to be, that the fact tliat Daniel McCarthy had authority to bind defendant by a contract of insurance,such anote as the one sued one, did not authorize him to delegate that authority to Thomas Burke; and plaintiff to recover in this action must prove by evidence other than the fact, that he himself possessed such authority, the power of said McCarthy to delegate said authority to said Burke. ”

And these instructions the court refused, viz:

1. “ The court declares the law to be that on the evidence plaintiff cannot recover.

2. “ The court declares the law to be, that a simple authority from defendant to Daniel McCarthy to effect insurance for defendant, would not authorize said McCarthy to bind defendant by the contract of insurance given in evidence, or to the note sued on, and plaintiff in order to recover, must prove special authority to make such a contract of insurance, and to give such a note, or a ratification of said contract, and of the execution of said note by defendant.”

3. The court declares the law to be, that the paying of premium money on the policy given in evidence, and of- assessments on the note given in evidence, out of money in his hands belonging to defendant by Thomas Burke without authority so to do. and which payments defendant never assented to, was not a ratification by defendant of tlie contract of insurance read in evidence, or of the execution of said note, notwithstanding defendant accepted said Burke’s account with defendant, crediting himself with money so paid, and took no steps to recover such money. ”

4. The court declares the law to be, that the law does not authorize, and had not at any time authorized, any such officer of defendant as President, and no action of any person pretending to be such officer is binding upon defendant in consequence of his assuming to act as sneli officer.

Defendant excepted to the giving of tlie instructions for plaintiff, and to tlie refusal of the court to give the last series of instructions asked by defendant. Judgment was rendered for plaintiffj and after unsuccessful motions for new trial and in arrest, the cause was taken to the general term, where the judgment of special term being affirmed, the case comes here by appeal.

If there was any ambiguity in either the note or’the policy of insurance, parol evidence was perfectly admissible for the purpose of affording an explanation thereof, and of showing upon whom the liability, arising- from the execution of the note, should rest, and for whose benefit the policy was designed to inure.

In Mechanics’ Bank of Alexandria vs. Bank of Columbia, o Wheat., 327, which was an action of assumpsit on the following- check:

“Mechanics’ Bank of Alexandria, June 25, 1817.

Cashier of the Bank of Columbus pay to the order of P. H. Minor, Esq., ten thousand dollars.

¥m. Patton, Jr.”

The court says “ It is by no means true, as was contended in argument, that the acts of agents derive their validity from professing on the face of them to have been done in the exercise of their agency. In the more solemn exercise of derivative power, as applied to the execution of instruments known to the common law, rules of form have been prescribed. But in the diversified exercise of the duties of a general agent, the liability of the principal depends upon the facts; first that the act was done in the exercise, and second within the limits of the powers delegated. These facts are necessarily inquirable into by a court and jury; and this inquiry is not confined to written instruments (to which alone the principal contended for coixld apply) but to any act with or without writing within the scope of the power or confidence reposed in the agent. ” In that case it was contended that, as the check on its face purported to be the private check of Patton, no extrinsic evidence could be received to prove the contrary. And in reference to that the court further says: “ The only ground, upon which it can be contended that this check was a private check, is that it had not below the name the letters “Cas.” or “Ca. ” But the fallacy of the proposition will at once appear from the consideration tliat the consequences would be that all of Patton’s checks must have been adjudged private. For no definite moaning could be attached to tlie addition of these letters without the aid of parol testimony.”

Tiie case of the Commercial Bank vs. French, 21 Pick. 486, was a suit upon a note, made payable to tire “Cashier of the Commercial Bank,” and it was contended that the suit should have been brought in the names of the person then Cashier and would not lie in the name of the Corporation. But the Court there say: “So a contract with the stock-holders, or with the President and Directors, or with the Directors of the Commercial Bank, would doubtless be in its legal effects a. contract with the corporation. It is not easy to perceive why a contract with the Cashier of a Bank is not a contract with the Bank itself. * * * * * The principle is that, the promise must be understood according to the intention of tlie parties. If in truth it be an undertaking to the 'Corpora, tion, whether a right or a wrong name, whether the name of the corporation or of some of its officers.be used, it should be declared oil and treated as a promise to the Corporation.”

The above cases are in full accord with tlie decisions of our own State, that of Mechanics Bank vs. Bank of Columbia, 5 Wheat., 327, being cited with approval by Judge Ewing in Smith vs. Alexander, 31 Mo., 193 ; See also to the same effect Schultze vs. Bailey, 40 Mo., 69 ; Musser vs. Johnson, 42 Mo., 74 ; McClellan vs. Reynolds, 49 Mo. 321.

In the present case the note sued on is signed “ Daniel McCarthy Prest.” But president of what? Just here, under the rules laid down in the above .cited cases, parol evidence steps in and affords a ready and satisfactory explanation. The abbreviated word Prest, attached to the name of Daniel McCarthy is an ear mark of the official capacity in which the note was signed — not evidence, it is true, that the note was signed in that capacity, but a sufficient basis for tlie introduction of testimony tending to establish that fact.

I have hitherto treated this case just as if tlie note sued on were standing alone; and explanatory oral evidence was offered in regard to tlie above alluded to abbreviation.

But this record presents a far stronger case then if the note stood, by itself. Here the note is numbered 2969, so is the policy, and both are of even date. The note says “Bor value received in Policy No., 2969,” and the policy recites the execution of the note “for the sum of seven hundred and fifty dollars, being the amount of deposit or premium for insurance as above said,” thus keeping up as it were between the policy and the note a reciprocal crossfire of reference; and establishing beyond peradventure the design with which the note Avas executed, on Avliom the burden of its payment was intended to be east, and for Avhose benefit the policy Avas meant to inure. To all intents and purposes, therefore, the result is precisely the same as if note, policy, and application were all written upon one and the same sheet of paper. To hold ■otherwise would be to entirely ignore the familiar rule, always applicable Avlrere one instrument makes reference to another.

McCarthy’s authority to act in the premises is to be presumed from the high official positions which he held — being, as the e\’idence shows, at the time of the transaction put in issue by tlie pleadings, Superior or President and Procurator or Treasurer of defendant — from the fact the policy of Insurance aves sent to him, from the fact that after notice of an assessment Avas sent to him at Perry ville as President of defendant, that response was made through Burke, and the assessment paid; from the fact that • McCarthy had in his possession the policy in question, together Avith others purporting to havb been made in the same Avay and at the same time, and “authorized” a lawyer Avliom he consulted for the purpose “if they were not legal to have them made legal ” ; from the fact that Burke, tlic former Procurator or Treasurer of defendant, out of the money in his hands paid to him by the patrons of defendant, had made disbursements for assessments and sent memoranda thereof to McCarthy once or twice a year for several years, as McCarthy himself swears. These facts, and many others of like sort pointing in the same direction, leave no doubt in the mind that Burke, either by prior appointment or subsequent sanction from McCarthy, was fully empowered to give the note and effect the insurance for the defendant which gave rise to the suit, and that McCarthy had full power to authorize Burke to act as he did. No proof of auy special authority was required.

The doctrine has been long since justly exploded, that every act to be performed by the agent of a Corporation has to be authenticated by its Corporate Seal.

Thus in the “Union Manufacturing Company vs. Petken, 14 Conn., 174, speaking with reference to this point, the Court say :

“But it is said that no act or vote of the corporation is shown ; nor is there any witness to the fact that this was done by the Corporation, or by its authority. It is now quite toe late to question the acts of a corporation because a vote and seal are not shown, since the decisions in our own Courts and the Courts of the United States” (See also Western Bank of Mo., vs. Gilstrap, 45 Mo., 419.) It is the merest play upon words, to assert, as was done in one of the refused declarations of law asked by appellant, that “ the law did not authorize any such officer of defendantf as President.”

The testimony of McCarthy himself shows, that the term Superior was tantamount to that of President and meant the same thing.

Once establish the fact, as the evidence amply does in this case, that a given 'person holds certain high official relations towards a Corporation, and is in the active exercise of powers for a series of years, and engaged in the performance of duties usually incident-to such official position, and it matters little whether he is called Superior or President.

The first, second, and fourth declarations of law, which the Court refused to give for defendant, were properly refused as shown above. The defendant’s third declaration was properly refused also, as it assumed the existence of two facts ; first, that Burke made the payments “without authority so to do,” and second, that defendant “never assented to” such payments.

There are also minor exceptions in this record which have either been incidentally passed upon in the foregoing remarks, or. which, although considered, are not regarded as possessing sufficient practical importance to merit specific mention.

As the result of the views herein expressed, there is no error in the record and the Judgment will accordingly be affirmed.

Judge Wagner absent. The other Judges concur.