Court Opinion

ID: 7875257
Source: CourtListenerOpinion
Date Created: 2022-09-08 21:06:35.543991+00
Date Added: 2024-06-11T16:31:19.339476
License: Public Domain

Gilpin, Chief Justice,

delivered the opinion of the Court, Considering the third ground of defence taken by the defendant as fatal to the plaintiff’s right to recover in this action, I do not propose to express any opinion on the question as to whether the draft, which is the subject of controversy, was or not, according to it- terms and meaning, made payable out of a particular fund, nor the other question as to the legal effect of the draft’s having been held by Stephen Broadbent, one of the acceptors as an indorsee. Much has been said and well said on this point, but for the reason just suggested, I do not deem it at all material to pass upon them.
By agreement of the parties the original draft is made a part of the case stated, and upon examination of the draft we find that the corporate seal of the company is affixed or impressed upon the paper upon the left of the signature of H. W. McColley, Treasurer of the Company. The usual terms indicating the affixing of the seal, are not found at the end of the draft—they are omitted altogether. If the case had been tried at the bar of the *297Superior Court before a jury, the fact of, whether the seal had been rightfully affixed to the draft, might have been controverted, notwithstanding the well established legal presumption arising from the presence of the corporate seal affixed to the instrument produced, that it was placed there by competent authority; the rule being, 'that, when the common seal of a corporation appears to ‘be affixed to an instrument and the signature of a proper officer is proved or admitted, the Court is bound to presume that the officer did not exceed his authority, and the seal itself is prima facie evidence that it was affixed by proper authority; and the burden of showing that it is wrongfully there rests upon the party objecting to it. Lovit v. The Steam Saw Mill Association, 6 Paige 54. The President, Managers and Company of the Berks and Dauphin Turnpike Road v. Myers,6 Serg. & Rawle 12. Baptist Church v. Mulford, 3 Halst. (N. J.) 183. The ease of St. Mary’s Church, 7 Serg. Rawle 530. The proprietors of the Mill Dam Foundry v. Hovey, 21 Pick. 417. Phillips v. Coffee, 17 Illinois 154. Johnson v. Crawley, 25 Ohio 316. Potter et al. v. Androscoggins & Kennebec R. R. Company, 37 Maine 316.
But in this case, the question as to whether the seal is ■rightfully or wrongfully on the draft cannot cbe raised. For the parties have made the seal itself, just as much as the body of the draft or the signature of the Treasurer, apart of the case stated, without suggesting the slightest doubt of it being there properly. Indeed, it is alleged in the case stated that the draft, after it was indorsed by II. W. McColley, Treasurer of the Junction and Breakwater Railroad Company, was sent by a duly appointed committee of said company to Baltimore for acceptance, and was there accepted by France, Broadbent & Co. It passed from the hands of the Treasurer to the committee, (of course with the seal on it—for it does not appear that it ever afterward returned to the hands of the Treasurer)—was sent by them to Baltimore, was accepted by the drawees, was negotiated by the company, and is *298now produced by the plaintiff with the seal on it and made a part of the case stated. All this amounts to an admission that the seal was placed on the draft rightfully and not surreptitiously, improperly or fraudulently. But aside from this admission, the presence of the seal on the draft, in the absence of evidence of statement impeaching its correctness, concludes the question here, as to its having been affixed by proper anthority.
The more approved mode of executing a deed by a corporation, is to conclude the instrument by saying “ In testimony whereof the common seal of the said corporation is hereunto affixed.” But this is not necessary to the validity of the instrument. Nor is it necessary to name or refer to the seal at all. Mill Dam Foundry v. Hovey 21. Pick. 417. Godard’s Case 5 Co. R. 5. Com. Dig. Fait a 2. 2 Serg. & Rawle R. 504. In the case of Mill Dam Foundry v. Ilovey, the instrument concluded in the words, “In witness whereof we have hereunto set our hands;” and the seal consisted of a wafer and a small bit of paper stamped with a common desk seal of a merchant. And it was •contended that this was not the seal of the corporation, the words of in testimonium-being, “ we have hereunto set our hands ” merely. But the Court thought otherwise, and decided that it was the deed of the parties, declaring that it had been settled that words indicating that the parties had affixed their seals, were not absolutely necessary.
The question reserved for- the decision of this Court is this : whether the instrument of writing sued on and described as a bill of Exchange, does in fact and in law constitute a valid bill of exchange, so as to entitle the present indorsee and holder, William C. Conine, the plaintiff, to sue and recover upon it as such. In other words, is it transferable by mere indorsement, so as to entitle the holder by force of such indorsement, to maintain an action upon it, in his own name.
At the common law, choses in action could not be assigned, so as to give the assignee a right of action in his *299own name. Bills of Exchange, however, have always constituted an exception to this rule.
The origin of the latter is involved in some obscurity. It is very questionable whether they were known to the nations of antiquity. But whether they were invented by the Jews and Lombards, (as some writers have supposed) during the thirteenth century, and after their banishment, in order the more readily to draw their effects out of France and England; or by the Gribelins, upon their expulsion from Italy by the Gruelphs, in order to avoid confiscation of their effects by their enemies, certain it is that we find them to have been in use among the maritime and commercial communities, inhabiting the shores of the Mediterranean as early as the fourteenth century; from which region, it is most probable, they were introduced into England about the year 1381.
The facilities which they afforded for the safe transmission of money, or values, from one country to another, soon brought them into general use among merchants ; and the use of them becoming an established custom, it is believed they received judicial recognition at a very early day, although no authentic decision in regard to the custom, can be found prior to the time of James the First, 1603. The first case of which we have any knowledge, is that of Marten v. Boure reported Cro. Jac. 6—7. The declaration in the ease, which is set out in the report, describes the cause of action as a bill of Exchange, “signed with his hand secundum usum mercatorum.” And from that day to this, no case can be found in the books, of a bill of exchange with a seal affixed to it.
The most solemn and authentic act, as matter of contract, for finally and conclusively binding men to the observance of good faith toward each other, known to the civil law, was called a stipulation ; it was entered into before the civil magistrate upon questions and answers, carefully propounded and taken in writing, intended to explain the nature and character of the transaction, and to show that there was no surprise, and that the contract of *300the parties was their maturely considered and deliberate act. It could only be impeached by fraud.
Deeds, by the common law, are strikingly analogous to the ancient stipulation of the Civilians. The ancient forms and ceremonies prescribed by the common law, for proper authentication and establishment of a deed, were writing, sealing and delivery, and if the parties were illiterate, also reading of the instrument, all indicating a solemn and deliberate act, intended to he final and conclusive between the parties. Sealing was an essential element though signing was not.
Authentic history informs us, that seals come down to us from the most remote antiquity, and were originally derived from the nations of the far East. The scriptures declare that the “ writing that is written in the King’s name, and sealed with the King’s seal, can no man reverse.” Writings under seal constituted part of the formalities of a Jewish purchase of land. “And I bought the field of Hanameel, and weighed him the money, and subscribed the evidence and sealed it, and took witnesses.” see Jeremiah, chap. 82. 1 Kings, chap. 21. Esther, chap. 8. Daniel chap. 8. 9.
Seals, however, did not come into general use in England until after, or about the time of, the conquest; indeed, prior to that time, they were almost entirely unknown to our English ancestors; and, probably, the most ancient authentic sealed document in England, is the charter granted by Edward the Confessor to Westminister Abbey. A. D. 1017.
Deeds or sealed instruments, are not only of much higher antiquity than hills of exchange, hut they are of a totally different origin. They cannot be said to be made secundum usum mercatorum, since they find their recognition and validity in the more ancient rules of the common law. On the. other hand, bills of exchange find their origin and sanction in the usage and custom of merchants, the lex mercatoria, a particular or peculiar system, which, being in the interest of commerce, became at length gradually in-*301grafted into, and established as a part of the common law itself. By the common law, contracts are distinguished into two kinds,—contracts under seal, which are specialties, and contracts not under seal, which are simple contracts. It can hardly be necessary to say, that a bill of exchange is not a specialty, for no contract, by that law, is held to be a specialty, unless it be under seal, or a matter of record. But notwithstanding a hill of exchange is only a simple contract, it nevertheless differs from other simple contracts in two very important particulars, namely, its negotiability, and its presumed valuable consideration. At common law no chose in action was assignable, until bills of exchange became by force of the custom of merchants, the exception to the general rule. IS!"otes were made assignable in 1704 by the statute 3 and 4 Anne. Bonds and specialties, as well as notes, are made assignable by our statute;—the last by simple indorsement, the two former “ under hand and seal and before at least two credible witnesses.” Chap. 63, sec. 8. Revised statutes. If a specialty had been assignable by mere indorsement, where would have been the necessity for this statutory provision ? The distinction between a bill of exchange and a specialty, is found noticed in almost all elementary works on contracts—Chitty on Contracts 3. 4. Chitty on Bills 12. 13. Story on Bills, sec. 16. 2 Blac. Corn. 465. 466. All contracts under seal are specialties, sealing and delivery being the particular form and ceremony which alter the nature and operation of the agreement. Forms, consecrated by time and usage, become substance. The seal is substance and changes the nature and operation of the contract. It seems to me therefore, that the question which I have been considering, is settled upon principle against the plaintiff. But however this may be, it has been held as settled upon authority for more than thirty years past.
In the case of Warren v. Lynch, 5 Johns. 239, it was conceded by counsel on both sides, and by the court, Chancellor Kent, then Chief Justice, presiding and delivering the opinion, that a sealed note is not negotiable.
*302In the case of Clark v. The Farmers’ Woolen Manufacturing Company of Benton, 15. Wendell R. 256, it was held by the Supreme court of the State of Hew York, first, that a note for the payment of money under seal, though in all other respects like a promissory note, was not negotiable, and that an action could not be maintained upon it in the name of a person to whom it had been transferred; secondly, that the effect of affixing the seal of a corporation to a contract, is the same as when a seal is affixed to the contract of an individual; it renders the instrument a specialty.
I am not aware that this decision has ever been overruled, or even, doubted.
We are therefore of opinion that the plaintiff is not entitled to recover on this action.