Court Opinion

ID: 8004916
Source: CourtListenerOpinion
Date Created: 2022-09-09 01:52:29.868792+00
Date Added: 2024-06-11T16:35:49.753462
License: Public Domain

Sherwood, Judge,
delivered the opinion of the court.
By the terms of her husband’s will, the defendant became the sole legatee of all his property, both real and personal, including the promissory notes in suit, executed to the testator by Theo. P. Greene. Although the will was duly probated, the defendant never qualified as executrix, in accordance with lier-appointment as such, nor does the petition so allege. It does, however, charge, that, as executrix, she took possession of the assets of the estate, transferred the notes by delivery to herself as sole legatee, thereby becoming absolute owner, and for value indorsed and delivered the same before maturity to Ketterer, who in like manner transferred them to plaintiff. The non-payment of the notes at maturity, and notice thereof given to defendant, are also alleged. The answer put in issue the chief averments of the petition.
The negotiability of bills of exchange does not rest on positive law, but on the custom of merchants, which in process of time and with the increase of trade, ripened into what is known as the common law merchant. By that ancient usage, if the party in whose favor the bill was drawn, died, it was customary for his executor or administrator to negotiate it with like effect as if done by the testator or intestate. And this usage prevails in most if not all of the states of this country. Promissory notes were also embraced within the custom *340referred to, and were negotiable by the payees or their personal representatives, in the same manner as were bilis of exchange. But it having been held in England, that promissory notes were incapable of being thus transferred, and were not within the custom of merchants, the statute of 3 and i Anne, C. 9, was passed, which, after reciting the above mentioned ruling, provides that promissory notes should thereafter, (i. e., from May 1st. 1705) “ be assignable or indomable over, in the same manner as inland bills of exchange are or may be, according to the custom of merchants.” The first case which arose under this act was that of Rawlinson vs. Stone, (3 Wils., 1) where it appeared that an administratrix had transferred the note in suit, which had been made payable to her husband; the court holding that the whole property in the note was vested in the administratrix, and that since the statute of 3 and J Anne, which recognized the custom of merchants in respect to bills of exchange, and placed promissory notes upon the same footing with those instruments, it was competent for the administratrix to transfer the note, and the transferree to maintain his action thereon.
Our statute respecting bills of exchange, providing that promissory notes expressed to be for value received, etc., etc., (Wagn. Stat., 216, § 15) should “be negotiable in like manner as inland bills of exchange,” is no doubt derived from the statute of Anne, and if a familiar rule is to prevail, should be received with the construction placed upon it where first enacted, unless something in.our own laws should forbid. Besides, we have in this State adopted the common law of England (of which the custom of merchant formed a part) as it existed “ prior to the fourth year of the reign of James the First,” and save where it is local to that kingdom, or repugnant to or inconsistent with the constitution of the United States, of this State or of the statutes in force for the time being, is to be the rule of action and decision here. (Wagn. Stat., 886, § 1.)
This adoption of the common law occurred in 1816. The right of an executor or administrator to negotiate' a bill or *341note drawn in favor of, or made payable to his decedent is asserted in all its broadness by the text writers as unquestioned law. (1 Pars. N. and B., 157; Sto. Confl. L., § 359 ; Sto. Bill Exch., §§ 72, 71; Sto. Prom. Notes, § 120; Wm’s Ex’rs, 806.) And also by the courts of last resort in many of our sister States. (Malbon vs. Southard, 36 Me., 147 ; Owen vs. Moody, 7 Cush., 79; Prosser vs. Leatherman, 1 How., [Miss.] 241; Dwight vs. Newell, 15 Ill., 333; Sanders, vs. Blaine’s Adm’r, 6 J. J. Marsh, 446; Sutherland vs. Brush,, 7 Johns. Ch., 17; Wheeler vs. Wheeler, 9 Cow., 34; Rand vs. Hubbard, 1 Met., 252.) But it will be observed upon examination, both of the text writers and of the reports of many of the States, that 3 Wils., svpra, is, when authority is deemed worthy of citation, relied on.
Now it must be evident that 3 Wils. cannot be authority for the transfer by an executor or administrator of promissory -notes, except in those States where the statute of 3 and 1 Anne took effect at the period of its enactment, or has subsequently become the law-in consequence of legislative recognition or adoption. It may be that in some of the States the right of an executor or administrator to indorse a bill or promissory note is deduced as a necessary sequence from the doctrine of the common law prevailing in those States, which regards such personal representative as the absolute owner of the personalty.
But this doctrine of the common law does not prevail in this State, and the power of the ¡personal representative of the decedent, whether testator or intestate, to dispose of the assets is limited and regulated by law. This was the express ruling of this court in Stagg vs. Greene, (17 Mo., 500) where it was held, that until an executrix has taken the steps prescribed by the statute, and become thus qualified according to law, she possessed no power to transfer a promissory note made payable to her testator; and that the petition which failed to aver her compliance with the statutory requirement, was bad on demurrer, as showing no title in -the plaintiff to the instrument sued on. Again, our legislature has pointed out only *342one instance in which executors or administrators may assign notes and bonds of the estate, and that is in discharge of the claims of creditors, legatees or distributees, equal to the amount of the bond or note. (Wagn. Stat., 89, § 40.)
As declaratory of the common law right of an executor or administrator to dispose of the personalty of his decedent, such legislative permission would obviously be devoid of meaning. This being the case, the section referred to, whatever may be thought of its possessing sufficient comprehensiveness to embrace bills of exchange, may be safely and fairly assumed to be restricted .in its operation as to notes and bonds, and to preclude their transfer, except where the statutory exigency arises, or the will under which the executor acts and is qualified, so provides.
If this view be correct, then it follows that the negotiability of promissory notes in this State, except in the instance mentioned, must, contrary to an everywhere prevalent rule, cease with the death of the payee. But it may be urged that the notes in question were bequeathed by the payee to the defendant, that she takes by virtue of the will, and therefore that the statute cited has no bearing on the case at bar. In reference to this, it can be said, that if our construction of the statute is the proper one, then non-negotiability is the rule, and the instance designated by the statute constitutes the only exception. And as the executrix has never qualified, the negotiability of the notes must be regarded as suspended or in abeyance, until such time as there is some one empowered, either under the law or under the will, to effect their transfer.
It has been held in this State, that if a person not a party to a note writes his name on the back prior to its being put into circulation, he will, in the absence of extrinsic evidence, be deemed an original promissor, and liable in that capacity. (Powell vs. Thomas, 7 Mo., 440; Lewis vs. Harvey, 18 Mo., 74.) And the same view of the law is entertained in Massachusetts (Moies vs. Bird, 11 Mass., 436). But a different rule obtains where, as in the present instance, the affixing of the *343signature occurs long after the delivery of the note to the payee. Thus in Tenney vs. Prince, 4 Pick., 385, a negotiable note was indorsed before maturity in blank, by a person not a party thereto, nine months after its delivery, and above the indorsement the plaintiff wrote a promissory note, and brought suit thereon, and it was held that the defendant could not be charged as an original promissor, but merely as guarantor, " as that was the only form of engagement consistent with the time aud circumstances under which the signature was made,” and it was further held that the defendant would not be chargeable on the guaranty, unless a legal consideration for that collateral undertaking were shown. There was no evidence in that case as to the intent with which the signature was made, nor that any value was received for the indorsement j and the court remarked that the ground upon which a party was held as an original promisor, was because he was supposed to be a participant of the consideration. And the judgment in that cause was reversed on account of the form of the action, and because no consideration for the signature was established. Judge Gamble, in Lewis v. Harvey, supra, adverted to the distinction between that case and the one just cited from Massachusetts.
With what intent the signature of the defendant was placed on the notes, does not appear, nor does it appear when the words usually employed in an ordinary indorsement were written above her name, nor that she received any consideration therefor. The only consideration received, so far as the testimony indicates, was by Ketterer, who indorsed the notes to plaintiff. The American authorities seem in substantial uniformity in holding that if the indorsement is made in blank, and as a subsequent and distinct transaction, not in any way connected with the formation of the note, that then the indorser is not to be treated as anything more at most than a guarantor. (Sto. Prom. N., §§ 474, 475.)
In Massachusetts, as already seen, (Tenney vs. Prince, supra.) the rule-is the same as to a negotiable note when si mi*344larly indorsed. And no good reason is seen why the same results should not attend the subsequent undertaking in the one case as well as in the other. In other words, if a contemporaneous indorsement is to indicate an absolute promise, then the converse of this should hold good that a subsequent indorsement shall only imply a collateral agreement of the above indicated character, whether the note is, or is not negotiable. So that it matters little whether we affirm or deny the negotiability of the note in suit, as in either event the defendant would not be chargeable as indorser, as is attempted in the present action.
It is not intended to assert that a person may not bind himself by any contract he sees fit to make in reference to paper to which he is not a party; it is only designed to state what, in the absence of evidence, are to be deemed legitimate inferences in reference to that contract, having regard to the time and circumstances under which it is made. On the part of the plaintiff, it is however strenuously insisted, that he should recover on the ground that the defendant is estopped to deny that she had any tide to the notes, after having indorsed them as “ sole legatee.” At what time these words were written does not appear, but the evidence clearly shows that the defendant is very old, ignorant of business, understanding English very imperfectly, could not read it when written, signed her mark to her name, and made no representations whatever. In addition to that, the plaintiff, prior to obtaining the notes from Ketterer, relied upon his own information, pursued his own inquiries, and formed his own conclusions. It is very plain, therefore, that there ai’e none of the elements of an estoppel about this case. (Big. Estop., 473.)
In conclusion, the plaintiff neither by the allegations of his petition, nor by the evidence adduced in their support, has shown any title to the notes. And it would contravene the policy of our law, and often result in the wasting of estates by irresponsible persons, to the great detriment of creditors *345and of others directly interested in the proper administration of the assets, were our sanction given to the recovery obtained by the plaintiff in the court below.
The judgment is reversed and the cause remanded;
the other judges concur.