In Youngs v. Perry (42 App. Div. 247) it was held that "An allegation, contained in the complaint in an action against the indorser of a note, stating that the indorsement was `duly' made, is sufficient to defeat a demurrer addressed to the validity of the indorsement; if the indorser wishes to litigate that question he must raise it by his answer."Summary of this case from Cosmopolitan Bank v. Blumberg
July Term, 1899.
Henry Cooper, for the appellant.
No appearance for the respondents.
The complaint sets out the making of a note to the order of the defendant corporation, and that the defendant duly indorsed it to the plaintiffs by the words, "Pay W.P. Youngs Brothers, Biershenk Co." The defendant demurred on the ground that the complaint does not state facts sufficient to constitute a cause of action. The court overruled the demurrer and from the judgment entered thereon the defendant appeals.
There is but one point raised on this appeal, that the form of the indorsement by the defendant corporation, to wit, "Biershenk Co.," without the addition of the name of the agent of the corporation by whom the indorsement was written, is imperfect and insufficient to charge that defendant. This proposition cannot be sustained. We may assume that as the indorser was a corporation it follows of necessity that the written indorsement could not have been its personal act, but must have been done by an agent. But while it is the preferable way for an agent in executing any instrument in the name of the principal to add his own name as agent, so that the instrument may show by what person the signature was written, still in law the writing of the name of the principal alone is sufficient. It is competent and proper also for the agent to sign simply the principal's name, and to show his authority to do so by extraneous evidence, for, as said by the United States Supreme Court, JOHNSON, J., writing: "It is by no means true * * * 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 powers, 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, 1, that the act was done in the exercise, and, 2, within the limits of the powers delegated. These facts are necessarily inquirable into by a court and jury." ( Mechanics' Bank v. Bank of Columbia, 5 Wheat. 326, 337, 338.)
In Forsyth v. Day ( 41 Maine, 382) the court held distinctly that a principal may authorize his agent to act for and bind him in one name as well as another, that an agent authorized to sign the name of his principal effectually binds him by simply affixing to the instrument the name of the principal as if it were his own name, and that such authority may be shown aliunde. (See, also, Hunter v. Giddings, 97 Mass. 41.)
In the case at bar the important allegation is that the corporation indorsed the note. This and not the circumstances under which the indorsement was made, is the fact necessary to establish the liability of the defendant. The plaintiff on the trial will be bound to prove that the name of the corporation was indorsed on the note by some person or officer authorized to sign the name of the corporation. Such proof will sustain the allegation that the defendant duly indorsed the note. The use of the word "duly" is sanctioned by section 533 of the Code of Civil Procedure, in pleading the performance of a condition precedent in a contract. It has been held that an allegation that payment of a note was duly demanded at maturity, and that the note was thereupon duly protested for non-payment, and notice thereof duly given to the indorser, was sufficient, under section 162 of the old Code of Procedure, which corresponds with section 533 of the Code of Civil Procedure ( Adams v. Sherrill, 14 How. Pr. 297), where the court said: "Had not a different construction been given to the first clause of that section, I should have been inclined to hold that it was intended to apply only to contracts wherein the conditions precedent are expressly stated, and not to contracts where such conditions are implied by law, as in cases of the contract of indorsement. But as it has been several times held in this court that this clause of the 162d section does apply to the contract of indorsement, I feel bound to follow the decisions on this subject. (See 5 How. Pr. 107; 8 id. 53.)"
In Gay v. Paine (5 How. Pr. 107), last referred to, an action against both maker and indorser of a note, it was held that an allegation that a note was duly presented for payment was sufficient without specifying the place of the demand. The fact of the demand was also defined as a "condition precedent."
It is said, in Brownell v. Town of Greenwich ( 114 N.Y. 527), "`Duly,' in legal parlance, means according to law." Writing these words into the complaint, can it be said that an allegation that the defendant indorsed the note according to law is demurrable? We think not. If the defendant desires to deny the due indorsement of the note, it can set up such denial by answer. But on demurrer we consider the allegation a sufficient statement of a proper indorsement by the corporation.
The judgment should be affirmed.
Judgment affirmed, with costs.