Case Name: Rachel Aaronson, Respondent, v. The David Mayer Brewing Co., Appellant. Actions Nos. 1 and 2
Court: New York Supreme Court, Appellate Term
Jurisdiction: New York
Decision Date: 1899-10
Citations: 29 Misc. 289
Docket Number: 
Parties: Rachel Aaronson, Respondent, v. The David Mayer Brewing Co., Appellant. Actions Nos. 1 and 2.
Judges: 
Reporter: New York Miscellaneous Reports
Volume: 29
Pages: 289–292

Head Matter:
Rachel Aaronson, Respondent, v. The David Mayer Brewing Co., Appellant. Actions Nos. 1 and 2.
(Supreme Court, Appellate Term,
October, 1899.)
1. Corporations — Guaranty by vice-president of a brewing corporation of a customer’s lease.
Assuming that a brewing corporation has power to guaranty the performance of a customer’s lease of a saloon, the landlord cannot recover upon such a guaranty, executed by the vice-president alone, where there is no affirmative proof that the corporation had any knowledge or information of the existence of the guaranty, or knew that the vice-president had executed it in the name of the corporation.
S3. Same — Landlord put on inquiry by form of guaranty.
The form of such a guaranty is sufficient to put the landlord upon inquiry as to the extent of the vice-president’s powers.
Aaronson v. David Mayer Brewing Co., 26 Mise. Rep. 655, 867, reversed.
Appeal by the defendant from a judgment of the General Term of the City Court, affirming a judgment of the Trial Term ■of the City Court, and from an order of the General Term of the City Court affirming an order of the City Court denying a motion for a new trial.
B. Lewinson, for appellant.
H. B. Wesselman, for respondent.

Opinion:
Freedmah, P. J.
These actions were brought to recover for the rent of certain premises, leased by the plaintiff to one Albert, the payment of which, it is claimed, was guaranteed by the defendant in a written contract of which the following"is a copy:
" In consideration of the letting of the premises within mentioned to the within Samuel Albert and the sum of one dollar to me paid by said party of the first part, I, David Mayer, do covenant and agree to and with the party of the first part, and her legal representatives, that if default shall at any time be made by said party of the second part in payment of the rent and the perform anee of the covenants contained in the written lease on his part to he paid and performed, that I will well and truly pay the said rent or the arrears thereof, that may remain due unto the party of the first part and also all damages that may arise in. consequence of the non-performance of said covenants or either of them upon notice of any such default within 30 days thereafter from said party of the first part to the extent of $1,000.
" Witness hand and seal this 24th day of January, 1893.
" David Mayeb Brewing Go.,
" Osoab I. Mayeb, Vice-President."
The tenant defaulted in the payment of the rent for the months of July, August and September.
Hotices of such default were duly served upon the defendant, and, after the expiration of the thirty days from the time of giving the notice, these actions were begun. At the time of the trial both actions were tried as one action, but separate judgments were rendered in each case in favor of the plaintiff, and, upon appeal therefrom by the defendant, to the General Term of the City Court, were there affirmed, and from the judgments of affirmance by that court this appeal is taken. The facts in each case are similar and are substantially undisputed.
Assuming that the guaranty in question would have been valid and binding upon the defendant corporation, had it been signed by one having proper and requisite authority to execute it, I am of the opinion that the record fails to show that Oscar I. Mayer, the vice-president, had the necessary power to bind the defendant, by his signature thereto. The plaintiff read in evidence the direct examination of said Oscar I. Mayer, taken under and by virtue of an order of the City Court made in these actions on the 5th day of March, 189 Y.
In that deposition Mayer states that the defendant is a corporation organized for the purpose of the manufacture and.sale of beer,, that David Mayer is the president, that Albert (the tenant) carried on a saloon at Ho. 65 Hester street, in the city of Hew Tork, and was a customer of the defendant, that he (Mayer) had seen, the guaranty in question twice, once on the elevated railroad train going north, and again, on the same day, at the brewery of the defendant, that Albert handed it to him at the brewery, and said he (Albert) wanted the guarantee of the brewing company on the lease, that he (Mayer) replied that the company had stopped giving guaranties, that Albert then said, " I want to get the guarantee of Hr. David Hayer, as I had it previously, but the landlord thinks it better to get the Brewing Company." That he (Hayer) said, " tell the landlord that if he insists upon the guarantee of the Brewing Company, he simply has an empty signature, because the Brewing Company will absolutely guarantee nobody's rent or contract," and that Albert said he would tell Aaronson so. The defendant's counsel then read a portion of the deposition, not previously read by the plaintiff, in which Hayer stated that nobody had any right to sign or make a contract for the defendant without attaching the seal of the board of directors thereto.
Oscar I. Hayer was also sworn in behalf of the defendant, and made substantially the same statements, adding that Albert came to him with a request from Aaronson to have David Hayer sign the paper, and when he ascertained that David Hayer was not there, said he would take the guaranty of the defendant, and that he (Hayer) told Albert that the brewing company would not sign the guaranty without the direction of the board of directors.
This is all the testimony relative to the authority of Oscar I. Hayer to sign the guaranty. It appears, by Hayer's testimony, that at-the time of the conversation between himself and Albert he (Hayer) signed the guaranty in the manner it appears and he says that Aaronson was_ not present.
Aaronson swears that he was present when Hayer signed, as he says, " the lease."
Aaronson does not dispute the conversation testified to by Hayer or the statements Hayer swears that he made at the time he signed the guaranty, and it, therefore, becomes a question of law to determine whether Hayer had authority to bind the defendant corporation by placing the name of the company to the contract.
If Aaronson, whom, the plaintiff claims, was acting for her in the matter of procuring the guaranty and lease, was present at the time Hayer signed the name of the defendant to the guaranty, he had notice of the want of authority in Hayer to bind the company by such signing. If he was not present, the plaintiff, upon the , delivery to her, by Aaronson, of the guaranty, with the name of David Hayer in the instrument as the guarantor, and the name of the defendant as the only signer thereto, was put upon her inquiry as to the nature and conditions of the contract and was chargeable as to the powers and purposes of the corporation. " Whatever is sufficient to put a person of ordinary prudence on inquiry is constructive notice of everything to which that inquiry will reasonably have led." Cheever v. Pittsburgh, S. & L. E. R. R. Co., 72 Hun, 380. "All persons dealing with the corporation were bound to take notice of the nature and extent of the powers and authority possessed by the officers." De Bost v. Albert Palmer Co., 35 Hun, 386. " The plaintiff was chargeable with knowledge of the corporate powers of the defendant and of the extent to which its cashier could bind the corporation." Jemison v. C. S. Bank, 122 N. Y. 140; Alexander v. Cauldwell, 83 id. 480; Wilson v. Kings County El. R. R. Co., 114 id. 487. " The by-laws of the defendant corporation were put in evidence; they conferred no authority to issue promissory notes. In this state of the by-laws it was necessary for the plaintiff, in order to establish the liability of the defendant upon the notes, to show either acquiescence or ratification by the trustees of the power assumed by the treasurer to issue notes." Bangs v. National Macaroni Co., 15 App. Div. 522.
In the case at bar there is no evidence that the defendant had any knowledge or information of the existence of the guaranty, or that it knew- of the signing of the same by Mayer.
From the foregoing it will be seen that there was an entire failure to show that Oscar I. Mayer had power or authority to bind the defendant by the signing of such instrument.
The judgments should be reversed and a new trial ordered.
Leventeitt, J., concurs; MaoLeak, J., concurs in the result.
Judgments reversed, new trial ordered, with costs to appellant,' in each case, to abide event.