Case ID: iowa_56/html/0114-01.html
Source: Caselaw Access Project
Author: {"author": "Adams, Ch. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Draper v. Rice.
    1. Principal and Agent: promissory note: payment. Authority to sell property as agent, and take a note therefor in filename of the principal, does not include authority to receive payment of the note after it has been delivered to the principal.
    2. Promissory Mote: evidence to vary terms op: payment. The maker of a note cannot show, as a. defense thereto, that he has paid it to another than the payee, in accordance with a contemporaneous parol • agreement, differing in its terms from the note.
    
      Appeal from Li/tvn Circwit Court.
    
    Saturday, April 23.
    Action upon a promissory note for $23. Defendant pleaded payment. Judgment for plaintiff Defendant appeals.
    
      
      J. T. Rice and Geo. W. Wilson, for appellant.
    
      Mills d? Keeler, for appellee.
   Adams, Ch. J.

The note was made payable to the plaintiff, or bearer. It was given in part payment for a melodeon which was sold to the defendant as the property -of the plaintiff. The trade was negotiated by ° ,} one Jacobs, who took the note and delivered it to the plaintiff. Afterwards the defendant paid the amount of the note to Jacobs, but he did not get the note up because it was in the possession of the plaintiff. The payment was made on the strength of Jacobs’ statement that he was the agent of the plaintiff and was authorized to collect the note, and would obtain it of the plaintiff and deliver it to the defendant.

Jacobs was not, in fact, the'plaintiff’s agent at the time of the payment, and plaintiff never received the money paid. The defendant, however, contends that while this may be so, he was justified in assuming that Jacobs was the plaintiff’s agent, because the plaintiff in receivi ng the note had recognized him as such.

The precise question certified for our decision is in these words: “When the plaintiff, as payee, seeks to recover on the note, can the defendant, Rice, maintain his defense of payment made to the assumed agent, Jacobs, in pursuance of the agreement made by said agent to obtain the note, although the said agent was acting without authority, as shown in this case.”

As showing that such defense can be maintained, the del fendant relies upon Eadie, Guilford & Co. v. Ashbaugh, 44 Iowa, 519. But that case is not .in point. It would, at most, only have the effect to show that the plaintiff, in ac-1 ce-pting the note, made Jacobs his agent in the transaction out of which the note grew. But that agency would not, w.e think, extend to the matter of payment. Authority to sell a' piece of property as pgent, and take a note for it in the name of the principal, would not, of itself, include the authority to receive payment. Had the note sued on been entrusted to Jacobs by plaintiff, although for some purpose other than collection, the case might be different.

It must be seen at once that the rule contended for would be a pernicious one. No person could, with safety, employ an agent to take a- promissory note, if payment made to the agent at any time afterward were to be held payment to the • principal, the agency having, in fact, been terminated, and the note remaining in the hands of the principal.

In our opinion the court did not err in rendering judgment for the plaintiff.

Affirmed.

supplemental opinion.

In a petition for re-hearing in this case, the appellant insists that the case cannot be distinguished from Eadie, Guilford & Co. v. Ashbaugh. It is said that when " a ^e °pini°n concedes that the acceptance of the no*e the plaintiff had the effect to show that the plaintiff made Jacobs his agent in the transaction out of which the note grew, the opinion concedes, virtually, the appellant’s whole position, for it is said that the evidence shows that in the transaction out of which the note grew, it was-agreed between the defendant and Jacobs that the note should be paid in the'use of livery to be furnished to Jacobs, and that it was so paid.

The note, by its terms, however, was made payable to the plaintiff in money. It is not allowable to show that by a parol contemporaneous agreement the note was not to be paid to the plaintiff in money, but to a different person, and in a different way.

In Eadie, Guilford & Go. v. Ashbaugh, the defendant set up a warranty for ,the machine for which the note was given. The only question was as to whether the warranty should be considered as made by the plaintiff’s agent. If so, it was, of course, allowable. to show it, whether made by parol or writing. The petition for a re-hearing must be overruled.