Court Opinion

ID: 6578734
Source: CourtListenerOpinion
Date Created: 2022-07-20 19:36:33.99024+00
Date Added: 2024-06-11T15:57:11.957644
License: Public Domain

Loomis, J.*
The declaration in this case contains three special counts in assumpsit.
In the first count the plaintiff, as indorsee, seeks to recover of the defendants, as makers, upon a promissory note in the following form:—
“$1500. On demand, for value received, I promise to pay to the order of Lyman Wolcott, fifteen hundred dollars. March 6,1862. Zelotes Terry.”
Endorsed on the back. “Lyman Wolcott, without recourse.”
*145The second count is upon a guaranty by the defendants for the payment of a promissory note as follows :—
“1400. Springfield, March 31st, 1859. Eor value received I promise to pay Nathan Daman, or order, four hundred dollars, on demand, with interest annually.
R. M. Abbe.”
Endorsed on the hack. “I guarantee the payment of this note, waiving notice and demand. Zelotes Terry, Trustee.”
The third count is upon a guaranty of another note as follows :—
“ $1300. Eor value received, we promise to pay Lyman Wolcott, or order, thirteen hundred dollars, as follows : four hundred dollars in one year from date; four hundred and fifty dollars in two years from date, and four hundred and fifty dollars in three years from date, with interest annually.
Springfield, Eeb. 16,1861. Sylvia B. Wood.
Charles B. Wood.
Endorsed on the hack. “ I guarantee ' the payment of this note to Lyman Wolcott, or order, waiving notice and demand.
Zelotes Terry, Trustee.”
“Lyman Wolcott, without recourse.”
Said notes and guaranties were executed in the state of Massachusetts. The evidence offered to support the first count was rejected by the Superior Court, and the jury returned a verdict for the plaintiff upon the second and third counts only. Both parties now ask for a new trial; the plaintiff, on account of the rejection of said evidence; and the defendant, on account of the rulings of the court upon the questions arising under the second and third counts.
The first question is, whether the court erred in rejecting the evidence offered by the plaintiff' under the first count of the declaration.
In connection with the introduction of said first described note, the plaintiff offered evidence to prove that Zelotes Terry, when he signed said note, and long before that time, was a *146duly appointed trustee for the East family of Shakers, located in Enfield in this state; that in giving and executing said note he acted as trustee for said community of Shakers; that said note was given in part payment for land deeded to said Terry as trustee; and that the land so conveyed has ever since been held and occupied by the trustees, for the use and benefit of said East family of Shakers ; and that according to the forms and usages of said community, the trustees thereof were accustomed to sign contracts and other writings, executed by such trustees on behalf of said community, sometimes by their own names alone, and sometimes with the addition of the word “ Trustee.”
The objections to this evidence which prevailed in the court below, were, that there was a variance between the declaration and the proof thus offered ; that the note on its face was the personal contract of Zelotes Terry, and not of Zelotes Terry, Trustee ; and that parol evidence was not admissible to show that the note was executed as the note of Zelotes Terry, Trustee.
The declaration alleges : — “that on the 6th day of March, 1862, Zelotes Terry was trustee, for the time being, of the East family of Shakers, the community aforesaid ; that on the 6th day of March, 1862, the said community, by the said Zelotes Terry, acting in his said capacity as trustee aforesaid, made a certain promissory note in writing, bearing date the said 6th day of March, 1862, and duly signed by the said Zelotes Terry, who then was trustee as aforesaid, and acting in said capacity, and thereby promised,” &c. The evidence offered accords perfectly with the allegations in the declaration, and therefore the objection upon the ground of variance merely cannot prevail. The real question is, whether the declaration can be proved by parol evidence. Can a note, signed “ Zelotes Terry,” be proved by parol to be the note of “Zelotes Terry, Trustee for the East family of Shakers?”
We will first consider the subject upon the principles of agency. We have a negotiable note, signed by the agent in his own name, without disclosing his agency or naming his’ principal in any manner ; and the question is, can such a con*147tract be enforced against the principal when subsequently discovered ?
As this question goes to the right of the party, and not to the remedy or judicial proceeding, and involves the nature, obligation and construction of the contract, we must resort to the lex loci for its solution. And by the law of Massachusetts it is well settled that if a negotiable instrument is executed by an agent in his own name alone, though in behalf of an undisclosed principal, it cannot be enforced against the latter ; because each party who takes a negotiable note, makes a contract with the parties whose names appear on the face of the instrument, and with no other, per sons.
So that all evidence, dehors the instrument, upon the question of agency, is to be excluded. Stackpole v. Arnold, 11 Mass., 27 ; Bradlee v. Boston Class Manufactory, 16 Pick., 347 ; Packard v. Nye, 2 Met., 47 ; The Bedford Commercial Ins. Co. v. Covell, 8 id., 442; Taber v. Cannon, id., 460 ; Fuller v. Hooper, 3 Gray, 334 ; Eastern Railroad Co. v. Benedict, 5 id., 565 ; Bank of British North America v. Hooper, id., 567 ; Fiske v. Eldridge, 12 id., 474 ; Williams v. Robbins, (case not yet reported — opinion by Hoar, J.)
If, therefore, this case were to be determined upon the principles of agency alone, the conclusion of the court would be correct.
But the record suggests another question, namely : Ought not the court to have allowed the evidence concerning this note to go to the jury as tending to show that Zelotes Terry was the business name of the defendants, by which they executed the note in question ? If there was any legitimate evidence bearing on this point it should have gone to the jury, because the law is well settled, by decisions in Massachusetts and elsewhere, that a man may make the name and signature of another virtually his own, by using or allowing it to be used as such in the course of his business. Fuller v. Hooper, 3 Gray, 334 ; Bryant v. Eastman, 7 Gush., 111; Melledge v. Boston Iron Co., 5 id., 158 ; Medway Cotton Manufactory v. Adams, 10 Mass., 360 ; Commercial Bank v. French, 21 Pick., *148486 ; Lindus v. Bradwell, 5 Com. Bench, 583 ; Bank of Cape Lear v. Wright, 3 Jones (Law,) 376.
The question is not whether the evidence was sufficient to have justified a verdict for the plaintiff, but whether there was any pertinent evidence improperly rejected. The weight of the testimony would'doubtless be impaired by the fact that the business name (if any) here employed, was not a purely artificial one, as is usual in such cases, but the name of a natural person, who, in the eye of the law, was competent to contract on his own account. But in principle there is no difference between assuming a purely artificial name, by which to transact business, and assuming the proper name of some other natural person ; only this, that in. the latter case the proof ought to be very clear to show that the contract was not designed to be the personal contract of such natural person.
Evidence was offered to show that according to the forms and usages of the community of Shakers the trustees were accustomed to sign contracts and other writings, executed by them on behalf of the community, sometimes by their own names alone, and sometimes with the addition of the word trustee. And in connection with this evidence it was shown that the community adopted this particular act of Terry, by retaining and enjoying the consideration of the note. And to rebut the presumption that the note in question was the personal note of Terry, there was the evidence furnished by the Shaker covenant to show that Zelotes Terry, as a member of the community, could not and did not own any worldly property, and that he could make no contract except in behalf of the community; and that under the covenant, there could be no such person, known to the business world, as Zelotes Terry, individually. The evidence (had it been received) might also have been strengthened somewhat, by a consideration of the peculiar legal character of the defendants.
The statiite (Gen. Statutes, p. 138,) allows the community to appear in court, either to sue or defend, only in the name of the natural person who is trustee for the time being. Therefore the name “Zelotes Terry” (if he was in fact trus*149tee,) was an essential part of tlie legal or corporate name of the defendants ; and its use in this instance would not carry with it so strong a presumption that it was the individual transaction of Terry, as it would under other circumstances.
Our conclusion therefore is, that the court erred in rejecting the evidence referred to, and that the plaintiff is entitled to a new trial. This would open the whole case, and give the defendants also the benefit of another trial. But it may be important, with a view to another trial, to settle some of the questions which the defendants’ motion presents.
The defendants ask for a new trial on account of erroneous instructions to the jury; and the question is, were the instructions “ correct, adapted to the issue, and sufficient for the guidance of the jury in the case before them ?” Waters v. Bristol, 26 Conn., 398. The defendants made seventeen specific requests, relative to the instructions to be given to the jury. Of these requests the first, (which relates to the law by which the contracts in question were to be construed, and their validity determined,) and the seventeenth, (relative to fraud,) were substantially complied with in the charge as given. The other requests, from the second to the sixteenth inclusive, comprise three points, viz :—
1. The law relative to the trusteeship.
2. That relative to ratification by the Shaker community.
8. That relative to the notes and guaranties in suit.
First. In relation to the trusteeship there were no instructions, except that the jury were to find whether it existed or not. It was assumed to be a prire question of fact, and not a mixed question of law and fact. No reference was made to the number of trustees required by the covenant, nor to the mode of appointment, extent of authority, or to any of the circumstances necessary to constitute a legal trustee. Some instructions were called for on these points, both by the nature of the case, and in consequence of claims made by the defendants at the trial.
The defendants made the distinct claim, founded on the covenant, which was in evidence, that the trustees could only *150be appointed by the ministry and elders, and that no such appointment had been made in the case of Zelotes Terry ; that even if the jury should find that Terry was a regularly appointed trustee, and there were at the time one or more other trustees of the East family, it would require a majority of the trustees concurring to bind the community ; that as the covenant provided for the appointment of deacons or trustees of more limited authority, to take charge of the domestic affairs of the community, the instructions ought to have been such as to enable the jury to distinguish between such limited authority and the more general and important authority to buy and hold real estate. The covenant also required the trustees to consult the ministry and elders on important matters, and as the defendants offered evidence to show that they were not consulted as to the acts in question, and made a specific request relative to this point, the instructions ought to have been such that the jury could judge whether or not there was any limitation on the authority of Terry to bind the community, so far as the case depended upon previous authority.
Second. The instructions relative to the law of ratification by the Shaker community were such as might have induced in the minds of the jury the erroneous belief that a general recognition of Terry’s acts as trustee, though in matters pertaining to the domestic affairs of the community, might be sufficient, or that “ any manner ” of ratification was sufficient; when the ground of ratification ought to have been confined to the particular acts in question, or at least to similar acts.
Third. The remaining requests, • as already stated, raise certain questions of law, relative to the notes and guaranties in the second and third counts : viz: Does the law of Massachusetts govern the the construction of these guaranties, signed Zelotes Terry, Trustee, and if so, are they the personal contracts of Zelotes Terry alone, so that all parol evidence is inadmissible to charge the defendants ?
That the law of Massachusetts must govern the case has already appeared. And by that law, if the instrument is a negotiable one, and the name of the principal does not appear *151upon it, it is held to he the contract of the signer alone, though he adds to his name the word “trustee” or “agent.”
The guaranty in the third count mentioned, being written on the back of a negotiable note, and being for the payment of the note to Lyman Wolcott or order, is clearly a negotiable instrument, and as such is governed by the rule just stated. This guaranty therefore became the personal contract of Zelotes Terry, unless “ Zelotes Terry, Trustee,” was either the corporate or the business name of the defendants, which might be shown, by parol evidence. But the name of the defendants was in dispute, and the jury might find that the name signed to the guaranty was not the name of the defendants ; which would leave the case to rest entirely upon the principles of agency. The defendants therefore were entitled to the benefit of their claim, that it was a mere case of agency ; and that if the jury found as claimed by them, the law was so that the plaintiff could not recover.
The charge of the court was silent with respect to the construction of the contract by the law of Massachusetts ; or if the charge as given covered this subject:- — -“that the plaintiff could recover on the second and third counts, notwithstanding the defendants’ objection to the form of the notes and guaranties,” then it amounted to a denial of the defendants’ claim on this point; and in either case the defendants are justly aggrieved. We think the court ought to have instructed the jury, not only that the law of Massachusetts governed the case, but particularly what the law was as applicable to the facts in issue. Hale v. New Jersey Steam Navigation Co., 15 Conn., 539; Lockwood v. Crawford, 18 id., 361.
The guaranty in the second count, signed “ Zelotes Terry, Trustee,” not being negotiable, raises the question whether, by the law of Massachusetts, parol evidence is admissible to charge the defendants as principals, upon an instrument not negotiable, upon the face of which the defendants are not mentioned ?
There is no difficulty, as we have already seen, in admitting parol evidence to show that “ Zelotes Terry, Trustee,” was the *152legal or the business name by which the defendants executed the guaranty. But considering the case upon the principles of agency merely, we find the authorities in Massachusetts leave the law upon this subject in doubt as to written instruments not negotiable.
One of the leading cases in Massachusetts upon this subject is that of Stackpole v. Arnold, 11 Mass., 27. This was an action upon a negotiable note, signed by the agent alone in his own name, without any addition or indication on the face of it that he acted in behalf of the principal, who was defendant in the case; but Parker, J., in giving the opinion of the court, makes no mention of the negotiable character of the note, but reasons in general terms applicable to all written contracts, not negotiable as well as negotiable, stating the rule as follows : “ No person in making a contract is considered to be the agent of another unless he stipulates for his principal by name, stating his agency in the instrument which he signs.”
On the contrary, in Huntington v. Knox, 7 Cush., 371, Shaw, C. J., seems to state an opposite doctrine in terms equally broad and positive, viz: “ Where a contract is made for the benefit of one not named, though in writing, the latter may sue on the contract, jointly with others or alone, according to the interest. The rights and liabilities of a principal upon a written instrument executed by his agent do not depend upon the fact of the agency appearing on the instrument itself, but upon the facts — first, that the act is done in the exercise, and second, within the limits, of the powers delegated ; and these are necessarily inquirable into by evidence.” The reasoning in the latter case is apparently irreconcileable with that in the former case, sufficiently so to overrule it; but Chief Justice Shaw in giving the above opinion did not refer at all to Stackpole v. Arnold, and the courts of Massachusetts have never considered the latter case overruled ; but the later decisions limit and restrain the reasoning in each to the particular facts of the case ; in Stackpole v. Arnold to the negotiable character of the instrument; in Huntington v. Knox to the fact that it was an action to recover the price of certain bark sold and *153delivered to tlie defendant, upon a writing by which one Geo. H. Huntington acknowledged to have received of the defendant a partial payment of $25, and in consideration thereof agreed to deliver to the defendant the bark in question, at a certain time and place, and for a specified price. The action was brought for the price of the bark, and was not directly upon the written contract.
In the case of The Eastern Railroad Co. v. Benedict, 5 Gray, 561, the action was upon the following written order: “ Please give Mr. D. A. Neal, president of the Eastern Railroad Go., stock in the Salem Gas Co., at par, to the amount of $7,000. Leonard Fuller.” This suit was sustained in favor of the Eastern Railroad Company, upon parol evidence that the order was in fact for the benefit of the company. Dewey, J., in giving the opinion says: “We may assume it to be quite clear, and well supported by authority, that in the 'case of oral contracts the principal may sue in his own name upon a contract made with his agent. It is. equally well settled that the same rule applies to sales by written bills or other memoranda made by the agent using his own name and disclosing no principal;” and after citing authorities, adds : “ It is unnecessary in the present case to decide whether upon a mere naked written promise made with one person without any reference in the instrument to an agency, the action upon proof of such agency in fact might be maintained in the name of the principal.”
In the case of Fuller v. Hooper, 3 Gray, 334, Metcalf, J., says : “ The rule is general, if not universal, that neither the legal liability of an unnamed principal to be sued, nor his legal right to sue, on a negotiable instrument, can be shown by parol evidence. In other simple contracts the rule is different.”
In Williams v. Robbins, a recent case not yet reported, Hoar, J., in giving the opinion, after referring to the case of Stackpole v. Arnold, 11 Mass., 27, in its application to negotiable paper, says: “That decision has beenorepeatedly recognized and confirmed in subsequent cases, although the reasoning of the judge who gave the opinion would lead to the application *154of the doctrine to contracts not negotiable, which later deci sions do not countenance or even expressly exclude.”
In Page v. Stone, 10 Met., 160, it seems to have been con ceded by counsel, and not discussed in the argument, that a note signed “A. F., for the assignees,” was sufficiently signed to bind the persons to whom A. F. had assigned his property in trust for his creditors, or such- of them as had authorized him to make the note. And Hubbard, J., in giving the opinion, says: “ We think it was properly left to the jury to de termine what was meant and understood by the words ‘ A. F., for the assignees.’ ”
Our examination of the cases cited, and other authorities in Massachusetts, leads to this conclusion, that if we are to consider the words “ Zelotes Terry, Trustee,” as the name merely of the agent of the defendants, there is no decision in that state which covers this case. The authorities generally recognize an important distinction between negotiable and non-negotiable instruments, as to the admissibility of parol evidence to charge an unnamed principal; but in the case of express written contracts, where the action is founded directly upon the written contract, there is still a doubt to what extent they will go in admitting such evidence. We observe a tend ency in the reasoning of the judges to place their decisions on the same ground as the English judges do, and we regard the decisions in England upon this subject as broad enough to cover such a case as this. Sims v. Bond, 5 Barn. & Adol., 393 ; S. C., 2 Nev. & Man., 616 ; Beckham v. Drake, 9 Mees. & Weis., 79.
But we are not prepared to declare, as the law of Massachusetts, that which her own courts have hesitated to announce ; and we think the case can be considered in another aspect where the law is not in doubt.
The facts presented, by the record in this case show that the words “ Zelotes Terry, Trustee,” signed to the guaranty, may mean something more than the mere name of the agent. In ordinary cases such would undoubtedly be the import of the words used.
But what is the true legal or corporate name of the defend*155ants ? Not “ East family of Shakers,” as we would commonly call them ; nor “ Brethren and Sisters of the United Society of Believers,” as called in the “ Covenant;” hut as we have already stated, it is the name of the person who is the trustee for the time being, with the addition, to make it complete, of the words “ Trustee for the East family of Shakers,” or equivalent words. The statute, it is true, only gives the name as one by which the defendants must sue and be sued ; but it is the proper name by which to contract also; it is the only corporate name.
The words “ Zelotes Terry, Trustee,” being then an essen tial part and the main part of the corporate name of the defendants, it cannot be said that the addition of the word “ trustee ” is necessarily merely descriptio personce; and the in strument in question being non-negotiable, there is no difficulty in admitting evidence dehors the instrument, by parol, to show that it was the Shaker trustee that was meant, and that the guaranty was in behalf of the community, and that the name used signified the community ; so that, in language similar to that used by Hubbard, J., in Paige v. Stone, 10 Met., 160, it might be left to the jury to determine upon the evidence what was meant and understood by the words “ Zelotes Terry, Trustee ;” and if the jury should find that they meant the defendants who were represented by a lawful trustee, acting in their behalf within the limits of his authority, it would undoubtedly be sufficient to make the defendants liable on the guaranty in the second count.
We advise a new trial in behalf of both parties.
In this opinion the other judges concurred.

See note, ante, page 131.