Case Name: George W. Cushman et al. v. William P. Welsh
Court: Supreme Court of Ohio
Jurisdiction: Ohio
Decision Date: 1869-12
Citations: 19 Ohio St. 536
Docket Number: 
Parties: George W. Cushman et al. v. William P. Welsh.
Judges: Beinkerhoff, C.J., and Scott, Welch, and White, JJ., concurred.
Reporter: Ohio State Reports, New Service
Volume: 19
Pages: 536–540

Head Matter:
George W. Cushman et al. v. William P. Welsh.
1. A sealed note or bill, made payable to tbe payee or order, can be negotiated; “ so as absolutely to transfer and vest tbe property thereof " in tbe indorsee, only “by indorsement thereon,” as authorized by tbe statute.
2. A warrant of attorney to confess judgment must be strictly construed, and the authority thereby conferred cannot be exercised beyond the limits expressed in the instrument.
3. A warrant of attorney attached to such sealed note or bill, authorizing a judgment to be confessed thereon “in favor of the legal holder” thereof, does not authorize a confession of judgment on such note in favor of the owner and holder thereof, without an indorsement thereon by the payee transferring the legal title to such owner and holder of the note.
4. Though the warrant of attorney be not available to him, the equitable owner and holder of such note may, under the provisions of the code, prosecute an action thereon in his own name.
Error to the court of common pleas of Union county. Reserved in the district court.
At the May term, 1867, of the court of common pleas of Union county, the defendant in error obtained a judgment against the plaintiffs in error for $523.50. The judgment was obtained by confession under a warrant of attorney annexed to the note on which it was rendered. No process was issued against the defendants below, and they had no notice of the proceeding, until after the judgment was rendered.
The note is made payable to Ricldey & Brother, or order. Following the note, and preceding the signatures of the makers, there is attached to the note a warrant of attorney, em • powering any attorney of any court of record to appear for the makers of the note in any court of record in the State of Ohio, and waive the issuing and service of process against them, and to “ confess judgment in favor of the legal holder” of the note against them, for the amount due thereon. To the note and warrant of attorney are attached the signatures and seals of the plaintiffs in error, defendants below.
At the same term of the- court at which the judgment was rendered, the plaintiffs in error filed their motion to set the judgment aside, on the ground that the court had no jurisdiction of the defendants in the case. The court overruled the motion; and the defendants, now plaintiffs in error, excepted, and filed their petition in error in the district court, and assigned for error the overruling their motion.
The case was reserved by that court for decision here.
John B. Goats for plaintiffs in error :
1. A promissory note payable to order and not to bearer, is not negotiable by the laws of Ohio, except by indorsement thereon.
2. A warrant of attorney annexed to and forming a part of such promissory note, does not, either by its terms or by the laws regulating commercial paper, become a negotiable instrument; and when such a warrant of attorney is trans* ferred from tlie payee of the note therein named, sueh warrant of attorney thereafter becomes invalid and inoperative.
In support of these propositions we refer to Avery v. Latimer, 14 Ohio, 542; Osborn v. Hawley, 19 Ohio, 130; Marsden v. Soper, 11 Ohio St. 503.
It follows, therefore, that the note in this case was not negotiable except by indorsement thereon, and that the warrant of attorney was not negotiable, either in law or by its terms, to enable the plaintiff in the court below, as the holder thereof, to obtain jurisdiction of the parties by virtue of the same, and take judgment by confession, as was done in this case.
If. G. Lawrence for defendant in error:
1. Can a promissory note of the hind sued on be transferred without indorsement ? And if so, —
2. Hoes such transfer carry with it the authority given in the warrant of attorney ?
If the law and the practice were now, as before the code, when the cases of Avery v. Latimer, 14 Ohio, 542, and Osborn v. Hawley, 19 Ohio, 130, were decided, there would not be much room for difference of opinion.
As to the first proposition, see Bank of St. Clairsville v. Smith et al., 5 Ohio, 222; Code, sec. 25; Swan's Pl. & Prec. 66, 67, 68.
The question of the negotiability of a warrant of attorney, such as the one made part of the note on which this judgment was rendered, has never been satisfactorily decided in Ohio.
The assignment of a chose in action or evidence of debt, generally, -carries with it all the collateral securities of the debt held by. the assignor, where 'the securities are mere incidents of the debt, as, for' instance, the assignment of a note, secured by mortgage, carries with it the security. Then why not allow the assignment or transfer of a negotiable instrument to carry with it the special privileges and remedies granted to the payee, when the instrument granting such remedies, in terms, implies that the payee may assign or transfer them.

Opinion:
Day, J.
The question in the case is made on the order of the court, overruling a motion to set aside a judgment rendered against the plaintiffs in error, on a sealed note or bill, by viitue of a warrant of attorney. The ground of the motion was, the alleged want of jurisdiction of the court below of the defendants in the case. The court had no jurisdiction of them, other than that obtained through the warrant of attorney attached to the note upon which the judgment was rendered.
The question, then, is, whether the confession under the warrant of attorney gave the court jurisdiction of the defendants below, to render judgment on the note against them in favor of the plaintiff below.
The note is made payable to " Rickley & Brother or order." It is under seal, and was not negotiated by indorsement, as authorized by the statute. It is averred, however, that the plaintiff below became the owner and holder of the note by purchase of Rickley & Brother, and paid them therefor the full amount of the note. Though he might, as the owner of the note in equity, have brought an action thereon, under the provisions of the code, in his own name, against the makers of the note, it does not follow that he could obtain judgment by confession on their warrant of attorney attached to the note. That depends on the extent of the power conferred by the warrant. The attorney can do nothing more than execute the power conferred by his warrant; moreover, " all authorities of this sort must be strictly pursued." Cowie v. Allaway, 8 Durnf. & East, 257. " Indeed, formal instruments of this sort are ordinarily subjected to a sti'ict interpretation, and the authority is never extended beyond that, which is given in terms, or which is necessary and proper for carrying the authority so given into full effect." Story on Agency, sec. 68.
Now, the power conferred by the terms of the instrument in this case was, to confess judgment only " in favor of the legal bolder " of tbe note. Tbe plaintiff below was not tbe " legal " bolder of tbe note, for tbe note bad not been indorsed to bim. He could become tbe " legal bolder " of tbe note only " by indorsement thereon," as authorized by tbe statute. S. & C. Stat. 862; Avery v. Latimer, 14 Ohio, 542.
Tbe waiving of process and confession of judgment in favor of tbe plaintiff below, was not, then, within tbe authority conferred by tbe power of attorney. Under tbe rule of interpretation applicable to such instruments, we must conclude that the jurisdiction of tbe defendants below, obtained through tbe warrant of attorney only, and tbe confession of judgment by means thereof, exceeded the authority conferred by tbe defendants in their power of attorney, and that tbe court, therefore, erred in overruling their motion to set aside tbe judgment, irregularly obtained against them.
Tbe negotiability of a warrant of attorney, with tbe note to which it is attached, was questioned in Ma/rsden v. Soper, 11 Ohio St. 503; and denied in Osborn v. Hawley, 19 Ohio, 130. But it is not necessary to pass upon tbe question in this case, for tbe judgment must be reversed on tbe ground already stated.
Beinkerhoff, C.J., and Scott, Welch, and White, JJ., concurred.