Court Opinion

ID: 4930833
Source: CourtListenerOpinion
Date Created: 2021-09-24 01:07:22.02537+00
Date Added: 2024-06-11T08:14:28.268941
License: Public Domain

The opinion of the Court was drawn up by
Tenney, C. J.
The note in suit, dated Nov. 3, 1853, payable to the “Atlas Mutual Insurance Company,” in twelve months from date, and indorsed — “pay to Arthur Leary, or order, for account of the Atlas Mutual Insurance Company,” and signed by George H. Tracy, secretary, was given for the *273premium of insurance on the ship “Detroit,” made at the time of the date of the note. The indorsement was made as early as January 26, 1856. The company suspended payment of losses, and its effects went into the hands of a receiver before the maturity of the note. The policy, for which the premium note was given, was surrendered to the receiver of said company by the defendant and his partner, since deceased, and cancelled on March 26, 1856, and during the life of the policy. The amount of the return premium due from the company, to the defendant and his partner, on said surrender, was the sum of $486,57.
Two questions are presented in this case. — 1. Has the note been indorsed, so that the action can be maintained against the defendant’s objection ? 2. If the action can be maintained, was the indorsement restrictive, so that the defence, which would be open in an action in the name of the payees, can be available in this suit ?
The secretary of an insurance company is the officer whose duty it is to make and keep the records; and is the official agent to carry into operation the votes and the directions generally of those who have the management of its affairs, unless the contrary in some manner appears.
In the Atlas Mutual Insurance Company, the president, vice president, and secretary were the officers by whom its business was conducted, subject to the direction of the board of trustees, who kept a record of their own acts. Although the secretary was not authorized by any vote of the board of trustees to make the indorsement on the note, he was empowered verbally by the president and vice president, with the knowledge of the trustees, to indorse the premium notes of the company. It does- not appear that the board of trustees withhold its consent to this direction. The indorsement being made before the suspension of payment of losses and the appointment of the receiver, the defendant can make no objection thereto. Cooper v. Curtis, 30 Maine, 488.
2. The indorsement is the same in terms with that referred to in the case of Truettel v. Barandon, 8 Taunton, 100, *274■which was an action of trover'for two bills of exchange, against a person who was the indorsee of the bills, and who deposited them as security for cash advanced to the indorser by the defendants in the action. The question was, whether the defendants did not take the deposit with sufficient notice that the bills did not belong to him ? And the Court answered this question in the affirmative, and the plaintiff was allowed to prevail. But the Court noticed a distinction between such a case, and one where the deposit was by way of discount. And it was said, by Burrougb*, .J. — “if the bills had been’discounted, and the money received, the amount would have been immediately entered into the account. But, deposited as they were, had they failed, their amount would have been struck out. The bills, therefore, did not form a real item in the .account.”
In the case at bar, the note yas applied, not as security for an indebtedness of the indorser, but to the payment of notes of the company. It was, as between the parties to the indorsement, similar to a discount for cash, and paid over to the indorsers. The indorsement, by its terms, was restrictive, and the ordinary and popular sense cannot be changed by parol evidence. 1 Greenl. Ev., § 295.
Upon the facts of the case, which are admissible in evidence, the action may be maintained. But the same defence is open which would have been allowed, if the action had been for, and in the name of the payees of the note. Since the note was given, a part of the consideration therefor has failed. Eor the balance, with the interest thereon, since the maturity of the note, judgment should be entered in favor of the plaintiff.
Rice, Appleton, Goodenow, Davis and Kent, JJ., concurred.