Court Opinion

ID: 6416062
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:56:15.934067+00
Date Added: 2024-06-11T15:51:33.455363
License: Public Domain

Gray, J.
Although the question presented by this case is novel in one of its aspects, the law of this Commonwealth, as established by previous decisions of this court, will go far to assist us in. determining it.
It is well settled that any person taking a negotiable promissory note contracts with those only whose names are signed to it as parties, and cannot therefore maintain an action upon the note against any other person. Bank of British North America v. Hooper, 5 Gray, 567. Williams v. Robbins, 16 Gray, 77. Brown v. Parker, 7 Allen, 337. Tucker Manufacturing Co. v. Fairbanks, 98 Mass. 101,104, and other cases there cited. That rule of course does not preclude charging a party who, instead of the name by which he is usually known, signs, with intent to bind himself thereby, his initials, or a mark, or any name under which he is proved to have held himself out to the world and carried on business. Merchants’ Bank v. Spicer, 6 Wend, 443. George v. Surrey, Mood. & Malk. 516. Williamson v. Johnson, 2 D. & R. 281; S. C. 1 B. & C. 146. Fuller v. Hooper 3 Gray, 334.
But if a person signs the name of another, as maker of a promissory note, who has not authorized him to do so, and who therefore is not bound by the signature, the signer is not personally liable in an action of contract upon the note itself, even if he signs his own name also as that of the agent affixing the other signature, and the party whose name he assumes to put to the note is incapable of making such a contract; but only in an action of tort for falsely representing himself to be authorized to sign the name of the other person. This rule has been asserted and steadfastly maintained by this court for half a century. In Long v. Colburn, 11 Mass. 97, it was held that upon a promissory note beginning “ For value received, I promise to pay,” and *340signed “ Pro William Gill. J. S. Colburn,” no action would lie against Colburn ; and the court said: “ The plaintiff’s remedy is against Gill, if Colburn had authority to make the promise for him; and if he had not, a special action on the case might make Colburn answerable.” In Ballou v. Talbot, 16 Mass. 461, the same point was adjudged; and it was held that upon a note signed “ Joseph Talbot, 2d, agent for David Perry,” no action would lie against Talbot, although the jury found that he was not authorized to sign the note as agent for Perry. So where a note, purporting on its face to be the note of the pastor and deacons of the First Freewill Baptist Church in Lowell, was signed “ S. D. York, Agent for the First Freewill Baptist Church in Lowell,” it was held that no action could be maintained on the note against York. Jefts v. York, 4 Cush. 371. And in a subsequent action between the same parties on the money counts, although the plaintiff proved an oral admission by the defendant that he had received the money and that he expected to pay the note, and it also appeared that neither such a church nor the pastor and deacons thereof had any legal authority to give a promissory note, it was held that the action could not be maintained, unless the money had been paid by the plaintiff to the defendant under a mutual mistake as to the legal capacity of the principal to authorize the giving of such a note, and the money had been applied by the defendant to his own use, or before he paid it over to his principal, been demanded back by the plaintiff; and Chief Justice Shaw said : “ The court are of opinion, that where a person, acting as agent, borrows money for his principals, and gives their obligation for it, and it turns out that the principals were not of legal capacity to make such contract, and of course could confer no such power on another the agent is not personally liable on the contract as his contract.” “ But if in fact he was not so authorized, but under a belief that he was, and acted on such belief, and the party advancing the money did not know that he was not authorized, the agent would be liable in an action on the case, to an amount in damages equal to the sum advanced. If one falsely represents that he has an authority, by which another, relying on the representa*341tian, is misled, he is liable; and by acting as agent for another when he is not, though he thinks he is, he tacitly and impliedly represents himself authorized, without knowing the fact to be true, it is in the nature of a false warranty, and he is liable. But in both cases his liability is founded on the ground of deceit, and the remedy is by action of tort.” Jefts v. York, 10 Cush. 392. So in Abbey v. Chase, 6 Cush. 54, Mr. Justice Metcalf said: “ When one, who has no authority to act as another’s agent, assumes so to act, and makes either a deed or a simple contract in the name of the other, he is not personally liable on the covenants in the deed or the promise in the simple contract, unless it contains apt words to bind him personally. The only remedy against him, in this Commonwealth, is an action on the case for falsely assuming authority to act as agent.” And in Draper v. Massachusetts Steam Heating Co. 5 Allen, 338, Mr. Justice Hoar said : “ In this Commonwealth it is well settled, that, if the instrument purports to express the contract of the principal, the agent is not personally liable on it; but that the remedy in such a case is by an action on the case for falsely representing himself to be authorized to bind his principal.”
In the present case, the plaintiff counts upon the notes them selves, seeking to charge the defendant as the maker of them, upon the alternative ground that the name signed by him to each of the notes was either the name of a person whose name he had no authority to sign or use, or the name of a fictitious person.
If either of those names was that of a real person, then, although no agency was expressed on the face of the note, and whether the signature was affixed under a mistaken belief of authority, or fraudulently, or even if it was a forgery, it was, so far as regards the liability to a civil action upon the notes, a mere case of signing without authority, and the signature might be adopted or ratified by that person, and such adoption or ratification would render him liable to be sued as maker thereof. Ballou v. Talbot, 16 Mass. 461, 463. Merrifiela v. Parritt, 11 Cush. 590, 597. Brigham v. Peters, 1 Gray, 139. McIntyre v. Park, 11 Gray, 102. Greenfield Bank v Crafts, 4 Allen, 447. *342Hunter v. Giddings, 97 Mass. 41. In such a case, it is deal that by the law of this Commonwealth, as shown by the cases already cited, the defendant could not be sued in contract upon the note, but only in tort. See also Met. Con. 108, 109.
The same rule must apply if the names signed to any of the notes were those of fictitious persons. In either alternative, the notes were not signed in the defendant’s own name, nor by any name under which he was shown to have transacted, or held himself out as transacting, other business. The defendant has not, by word or act, asserted that they were his own promissory notes. The plaintiff did not take them immediately from him, or on his credit. The defendant therefore is not estopped to deny them to be his. The defendant’s representation was, that they were signed by parties bearing, or doing business under, the names signed. He made no contract, and intended to make no contract, and was not understood by any other party to make any contract, himself. His relation to the plaintiff was not one of contract, but of tort. The case is not distinguishable in principle from that of Jefts v. York, 10 Cush. 392, already stated. There is no essential difference in this respect between a note purporting to be made by a person or corporation that has no capacity to make it, and a note purporting to be made by one that in fact has no existence; or between a note on which the name of the person by whose hand it is written appears, and a note on which it does not; and no more reason for holding him liable to an action upon it as his own contract in the one case than in the other.
The cases cited by the learned counsel for the plaintiff, when closely examined and weighed, afford no sufficient ground for a different conclusion.
The strongest case in his favor is that of Grafton Bank v. Flanders, 4 N. H. 239. It was there held that a person who signed the name of another to a promissory note as maker without any authority from him, and delivered it to the payee for a valuable consideration, was himself liable upon the note as maker in an action by the payee, charging him as having made f in the name of the other person. It is to be observed that in *343that case the defendant himself delivered the note to the plaintiff. And a careful consideration of the elaborate opinion of the court has failed to satisfy us that it is in accordance with the law of this Commonwealth. The courts of New Hampshire have always gone beyond our own in holding a person signing the name of another without authority to be himself liable to an action upon the contract. Underhill v. Gibson, 2 N. H. 352, 356. Woodes v. Dennett, 9 N. H. 55. Pettingill v. Mc Gregor, 12 N H. 179, 191. Moor v. Wilson, 6 Foster, 332, 336. Weare v. Gove, 44 N. H. 196.
In Palmer v. Stephens, 1 Denio, 471, the defendant had signed the promissory note sued on with his own initials; the court expressly waived the consideration of the question whether, if neither his name nor the initial letters thereof had appeared on the paper, he could have been holden as a party to it; and the general statement in the opinion, that, “if one, assuming to be agent of another person, executes a note in his name, having in truth no authority for the purpose, the assumed agent is himself bound by the signature,” though supported by the earlier cases in New York, is inconsistent with the later cases in that state, as it is with our own decisions. Walker v. Bank of New York, 5 Selden, 582. White v. Madison, 26 N. Y. 117.
In Brown v. Butchers’ & Drovers’ Bank, 6 Hill, 443, the signature which was held to bind the defendant as indorser of a bill of exchange was not of another name than his own, but of figures; and the report states that evidence was given strongly tending to show, not only that they were in his handwriting, but that he meant they should bind him as indorser.
The case of Melledge v. Boston Iron Co. 5 Cush. 158, went, no farther than to hold that a corporation was liable on a note given by its general agents, a mercantile firm,.in their own name, for a debt of the corporation, if the note was in fact the note of the corporation, executed under a name which it had adopted and sanctioned as indicative of its contracts, or if the payee took the note under a misapprehension, caused by the acts of the corporation and its agents, as to the identity of the corporation with the firm whose name was signed to the notes*, *344The doctrine of that case does not warrant charging either a corporation or a natural person upon a note signed in the name of another, without clear proof that such name has been adopted by the first for the purpose of transacting business. Williams v. Robbins, 16 Gray, 77. Brown v. Parker, 7 Allen, 337.
The remark of Mr. Justice Hoar, in Draper v. Massachusetts Steam Heating Co. 5 Allen, 338, that “ there may be cases in which the signature is in such a form that it might be held to be either the signature of the principal or of the agent, and in such case a want of authority to bind the principal might well be regarded as fixing the personal liability of the agent,” related to cases in which the names of both agent and principal appeared upon the face of the contract, and in a form making it doubtful which was intended to be bound.
The plaintiff much relied on the English cases in which an acceptor of a bill of exchange, in which a fictitious person was named as payee, has been held to stand as if it had been payable to bearer, and to be liable for the amount of the bill to one who has discounted it on the faith of his acceptance, even when the signature of the drawer for whose honor he accepted it was forged. Gibson v. Minet, 1 H. Bl. 569; S. C. 2 Bro. P. C. 48; 3 T. R. 481. Phillips v. Im Thurn, Law Rep. 1 C. P. 463; S. C. 18 C. B. (N. S.) 694. But those cases go upon the ground that the defendant’s own acceptance bound him, so that he could not, even if he acted in good faith, dispute the genuineness of the prior signatures. They do not hold him liable upon those signatures as his own, but upon his own signature as acceptor.
The plaintiff also cited Lobdell v. Baker, 3 Met. 469, in which it was held that if the holder of a promissory note, indorsed in blank by the payee, caused it to be indorsed by a minor, and then sold it, without erasing this indorsement or otherwise making it appear on the note to be without binding force, he was liable to all subsequent holders upon his implied representation that the indorsement constituted a valid contract. But the action in that case was in tort for the false representation. See S.C. 1 Met. 193.
*345The plaintiff further contended that he might waive the tort and sue in assumpsit; for which he cited Hill v. Perrott, 8 Taunt. 274; Biddle v. Levy, 1 Stark. 20; and Jones v. Hoar, 5 Pick. 285. But as there was no offer to show that the defendant had received any money upon the notes, that rule does not apply. Ladd v. Rogers, 11 Allen, 209.
If the facts which the plaintiff offered to prove were true, be would seem to have been defrauded by the act of the defendant. But he must seek his remedy for such fraud in an appropriate form of action. He cannot compel the defendant to try the question of false representation in an action of contract upon the notes.
We regret that after much consideration our judgment is not unanimous. It is the opinion of a majority of the court, that, for the reasons above stated, this action cannot be maintained upon either alternative of the facts which the plaintiff, offered to prove. The result is, that, according to the terms of the report upon which the case was reserved, there must be

Judgment for the defendant.