Case Name: The New England Marine Insurance Company versus James De Wolf Junior
Court: Massachusetts Supreme Judicial Court
Jurisdiction: Massachusetts
Decision Date: 1829-03-23
Citations: 8 Pick. 56
Docket Number: 
Parties: The New England Marine Insurance Company versus James De Wolf Junior.
Judges: 
Reporter: Massachusetts Reports
Volume: 25
Pages: 58–65

Head Matter:
The New England Marine Insurance Company versus James De Wolf Junior.
The rule, that an attorney or agent, to bind his principal, sign the name of the principal, applies only to deeds, and not to simple contracts.
I. C., who was duly authorized by J. D. to guaranty two notes, wrote on one, a Bj authority from J. D. I hereby guaranty the payment of this note. I. C. ” ; and on the other, “By authority from J. D. in a letter dated September 24,1Ü24, [from which C. derived his authority,] I hereby guaranty his payment of (he premium on policy No. 10079 [for which the note was given]. I. C.” Held, that J. D. was bound as guarantor of the notes, and not I. C.
The letters from J. D. to I. C. and from I. C. to J. D. and from J. D. to the person whose notes were guarantied, and from him to J. D. and to I. C., written before and soon after the guaranties were made, and in relation thereto and to the transactions in which they originated, being part of the res gestee, are admissible evidence in an action against J D. as guarantor of the notes.
The act incorporating an insurance company required all policies to bo signed by the president. A policy of insurance, which provided that a loss should he payable to the assured or his assigns, was assigned, and the company’s assent to the assignment signed by the secretary only, and the assignee guarantied the premium note, the company having refused to assent to the assignment without this guaranty. In an action against the guarantor of the note, held, 1. That the assent of the office to the assignment was a sufficient consideration for the guaranty, as without it an assignee, in case of loss, could sue only in the name of the assignor : 2. That the act of incorporation did not require the assent to the assignment to be signed by the president * 3. That the secretary’s signature primá facie bound the company, and that having accepted the guaranty, it had adopted the act of the secretary.
This was assumpsit against the defendant as guarantor of two promissory notes. The action was tried before Parker C. J.
A note for 1251 dollars was produced, dated November 27th, 1822, signed by George De Wolf for himself and John Smith, payable to the plaintiffs or order in eighteen months. This note was given for the premium of insurance on the ship Octavia and cargo, by a policy of that date. On the back of this note are the following words. “ Boston, April 27, 1825. By "-''horny from J. De Wolf junior, I hereby guaranty the payment of this note. Isaac Clap.” The other note was for 526 dollars, dated July 12th, 1824, signed by George De Wolf, payable to the plaintiffs or order in nine months, and was given for the premium of insurance on the brig Arab and cargo by a policy of the same date. On this note are indorsed the following words. “ By authority from J. De Wolf junior, in a letter dated Sept. 24, 1824, I hereby guaranty his payment of the premium on policy, No, 10079. Isaac Clap.” George De Wolf and John Smith continued in good credit till December, 1825, when they failed, without having paid or been called on to pay these notes. In both cases the risks were taken by the plaintiffs and the premiums earned.
The defendant’s counsel insisted that Isaac Clap was the only person bound by these guaranties, and objected to their being read to the jury ; but the judge ruled that they were competent evidence to charge the defendant, provided Clap’s authority to make them on behalf of the defendant was proved.
In order to prove this authority a number of letters were offered from the defendant to George De Wolf, from George De Wolf to the defendant, from George De Wolf to Clap, from Clap to the defendant, and from him to Clap, of various dates between September 1, 1824, and December 31,
1825. These letters tended to show the authority of Clap to guaranty the notes on behalf of the defendant, and also the assent of the defendant to the guaranty. The defendant’s counsel objected to the admission of the correspondence, particularly to George De Wolf’s letters to Clap and to the defendant, and insisted that Clap ought to be produced as a witness. But the judge admitted the whole of the correspondence. The plaintiffs likewise offered in evidence letters from the president of the insurance company to the defendant, demanding payment of the notes and the answers of the defendant.
The plaintiffs’ counsel likewise offered in evidence an instrument dated November 9, 1822, by which George De Wolf and John Smith assigned the ship Octavia and cargo, the brig Arab and cargo, and other property, to the defendant, as security for large advances made by him to them ; and also divers policies of insurance on the assigned property, among which were the two policies for which the abovementioned premium notes were given, all of which policies were assigned to the defendant. All these documents, except the two policies made by the plaintiffs, were objected to by the defendant’s counsel, as res inter alios acta, and therefore incompetent evidence rpjie ju(jge} however, admitted them.
The plaintiffs’ counsel introduced witnesses, who testified that it was not customary to demand or compel payment of premium notes until after the termination of the risks insured against; and that the risks in the two policies for which the two notes in suit were given, had not terminated at the time of George De Wolf's failure ; but it also appeared, that three premium notes given to the Suffolk Insurance Company had been demanded of and paid by George De Wolf in October, 1825, although the risks for which they were given had not then terminated.
The assent of the plaintiffs to the assignment of the policy on the Octavia was signed only by the secretary of the in surance company. The president of the Suffolk Insurance Company testified that it was customary for the secretaries of insurance companies to sign similar assents to assignments ; but' the president of the Boston Marine Insurance Company stated that the practice of that company, was otherwise. But it wras proved that small alterations are occasionally made in policies by the secretary, by direction of the president, without being signed at all.
The defendant’s counsel further insisted, that as special authority had been given by the defendant to Clap, to guaranty certain notes particularly described in his letter of September 24, 1824, a general authority to guaranty other notes could not be presumed, and therefore that the guaranty of the note for 1251 dollars, being unauthorized, was not binding on the defendant : and also, that as the policy on the Octavia contained an engagement on the part of the plaintiffs, to pay any loss to the assured “ or their assigns,” the supposed promise of the defendant to guaranty the premium note was without consideration. From the correspondence above mentioned it appeared, that the plaintiffs had refused to assent to the assignment, unless a guaranty of the note was given by the assignee. The defendant’s counsel also insisted, that as the assent of the plaintiffs was signed only by the secretary, it was not binding, and therefore there was no consideration for the guaranty ; which was therefore void. In support of this objection he relied on toe act incorporating the company, which requires all policies to be signed by the president.
The judge instructed the jury, that a contract to guaranty must be in writing, but that the authority of an agent to sign such contract might be proved by paroi, or might be inferred from the acts of the principal, and that if done without such authority, yet, if it was made known to the principal and approved by him afterwards, such conduct would amount to a ratification on his part; and the contract would be as binding on him as if made by virtue of a previous authority ; therefore, if they were of opinion, from the correspondence, that the defendant knew of the custom of the insurance offices to require of the assignee an agreement to pay the premium, before they would consent to an assignment of policies, and thus knowing it, insisted on having the assent of the plaintiffs obtained, and afterward accepted the policies ; they might infer from the correspondence, that the defendant had either previously author ¡zed Clap to give the guaranty, or had subsequently ratified it; and that the correspondence was legal evidence to prove such authority or ratification, if the jury thought it adequate : And that though the policy on the Octavia contained a promise to pay the loss to the assigns of the assured, yet any suit brought to recover the same must be in the name, of the assured, and the plain tills would have a right, in such suit, to set off all premium notes due them by the assured ; and their assent to a waiver of this right was a sufficient consideration for the de ' fendant’s guaranty. As to the assent of the plaintiffs being signed by the secretary only, the judge ruled that it was prima facie evidence of their obligation to the defendant.
The jury having returned a verdict for the plaintiffs for the amount of both notes, the defendant moved for a new trial for the misdirection of the judge.
Curtis, for the defendant.
The guaranties on both of the notes were in such a form, as to bind only Clap, and not the defendant. Stackpole v. Arnold, 11 Mass. R. 27 ; Fowler v. Shearer, 7 Mass. R. 14; Elwell v. Shaio, 16 Mass. R. 42; Copeland v. Mercantile Insurance Company, 6 Pick. 198; Bacon v. Duharry, 1 Ld. Raym. 246; Tippets v. Walker, 4 Mass. R. 595.
March 6th
The letters of Clap to the defendant, and of George De Wolf to Clap and to the defendant, and of the defendant to George De Wolf, were improperly admitted in evidence. They were res inter alios. 2 Stark. Ev. 60, 61; Langhorn v. Allnutt, 4 Taunt. 511. For the same reason, the policies signed at other offices were improperly admitted.
The policy on the Octavia being payable to the assured oi 11 their assigns,” nothing is gained by the assignee from having the consent of the office to the assignment, and there was therefore no consideration for the guarantee. The form of policy since in use • differs, in containing a clause making the policy void, in case of an assignment without assent.
An express authority having been given to guaranty some ol the notes, an authority cannot be implied as to any other.
The plaintiffs never consented to the assignment, the signa turc of the secretary alone not being binding on them. Act incorporating the plaintiffs, 3 Spec. Laws of Mass. 151, § 5, 6.
The plaintiffs were guilty of loches in not calling on the defendant before the failure of George De Wolf; and this negligence discharges the defendant.
S. Hubbard and W. J. Hubbard, for the plaintiffs.
The correspondence was properly admitted in evidence. Sumner v. Williams, 8 Mass. R. 214. It formed part of the res gestee. The letters of the defendant being admissible, the letters to which they refer and are answers, must also be admissible. In Whitehead v. Tucket, 15 East, 400, the same objection to the evidence might have been made, but it was not, being evidently considered untenable. It is clear from this correspondence, that Clap was sufficiently authorized to guaranty this note. Even if there was no authority, still Clap being the general agent of the defendant, and the defendant knowing that such a guaranty was necessary before the office would consent to the assignment, the defendant, by receiving the policies without objection, until called on to pay the notes, ratified the proceedings of Clap. Andrews v. Kneeland, 6 Cowen, 354. Fenn v. Harrison, 3 T. R. 757; S. C. 4 T. R. 177. The other policies were properly admitted in evidence, in order to show that Clap was the general agent of the defendant.
The guaranties in their present form bound the defendant, and not Clap ; it cannot be doubted that such was the intentian of the parties. Northampton Bank v. Pepoon, 11 Mass. R. 292; Long v. Colburn, 11 Mass. R. 97.
The consideration for the guaranty was sufficient, for the assent of the office enabled the defendant to sue in his own name, which, without it, he could not have done. Mowry v. Todd, 12 Mass. R. 281.
The plaintiffs have been guilty of no loches. The guarantor of a note is not, like an indorser, entitled to notice of its non-payment. Duval v. Trask, 12 Mass. R. 154; Bayley on Bills, (Am. ed.) 186, note; Men v. Rightmere, 20 Johns. R. 365; Cobb v. Little, 2 Greenl. 261; Williams v. Granger, 4 Day, 444.
The assent of the office signed by the secretary was sufficient. The presumption, prima facie, is, that he was author ized ; and the plaintiffs who bring this action cannot deny his authority. United States Bank v. Dandridge, 12 Wheat. 64.
March 23d.

Opinion:
Parker C. J.
delivered the opinion of the Court. With respect to the form of the guaranty, we are of opinion that the effect of it must be determined by the intention with which it was made. If Clap bad authority to make the guaranty for the defendant, and the words are such as not clearly to bind himself alone, and it can be ascertained that he intended to act for De Wolf, the latter will be bound. The authorities cited to maintain the position, that the name of the principal must be signed by the agent, are of deeds only ; instruments under seal; and it is not desirable that the rigid doctrine of the common law should be extended to mercantile transactions of this nature, which are usually managed with more attention to the substance than to the form of contracts.
Clap, in his guaranty, declares that he acts by authority of De Wolf, and it is evident, from all the circumstances of the case, that he professed to act only as his agent. The only question ought to be, therefore, whether he had such authority. Now it is perfectly clear from the letters of the defendant to Qlap and to George De Wolf, that he intended to guaranty the premium upon the policies which were assigned to him He was informed distinctly that he could no otherwise obtain the consent of the underwriters to the assignment, and their promise to pay any loss to him. His repeated calls for all the policies, his express direction with respect to all but one, his frequent and pressing calls for that which was omitted from the list transmitted by Clap, knowing the only terms upon which he could obtain the policies in question with the promise of the office upon them, are clear and decisive evidence of an authority to Clap, and if that were doubtful, of a ratification, with a full knowledge of the means by which they had been obtained.
In regard to the admissibility of the letters of Clap and George De Wolf, we think there is no question. The whole correspondence relates to a mercantile contract between the defendant and his agents touching the very subject in controversy, the guaranty of premium notes. It is the transaction itself, the res gvstce. It is admitted that the letters of the defendant are good evidence ; then certainly those to which his are answers should have been received. Indeed, the only use of the letters was to prove that the defendant knew the conditions on which alone the office would substitute him on the policies. There is no declaration of the agents to bind the principal, but the communication of facts which coming to his knowledge are to be used in construction of his subsequent acts.
In regard to the form in which the substitution was made on the policies, being by the secretary only, we think it clear that this was primó facie evidence of an obligation on the company. It is to be presumed that the secretary acted under instructions of the president and directors, and the charter does not require the signature of the president to any instrument but the policy. If an action had been brought on this promise by the defendant, to recover a loss, the company could not have resisted payment, unless they could show an express prohibition upon the secretary to bind them in this way. Indeed, having received a consideration in the guaranty of the defend ant, they have accepted the act of the secretary, and are bound by it.
We think also, that the promise of the office to pay, in case of loss, to the defendant, is a sufficient consideration for the guaranty, notwithstanding in one of the policies they originally agreed to pay to the assured or their assigns ; for the promise direct to him, on which an action could be maintained, is of itself a sufficient consideration.
Judgment according to verdict.
See Story's Comm, on Agency, 143,144, and cases cited; Penlz v. titan, ton, 10 Wendell, 271; Andrews v. Estes, 2 Fairfield, 267; Campbell v. Baker, 2 Watts, 83; Chitty on Contracts, (4th Am. edit.) 184, 185, and note.
See Revised Stat. c. 37, § 13, 29.