Court Opinion

ID: 5195365
Source: CourtListenerOpinion
Date Created: 2022-01-06 15:42:26.081628+00
Date Added: 2024-06-11T08:27:03.824398
License: Public Domain

Per Curiam :
The action is upon a $15,000 promissory note of the defendant corporation, which has been transferred to the plaintiff by George Hotchkiss, the payee. The note was made by J. S. Bailey, the defendant’s president and treasurer, in the name of the company, and it is undisputed that the $15,000 was paid by Hotchkiss in checks to the company’s order. The main defense was that the money was borrowed by Bailey for his own purposes and was used by him to pay his individual indebtedness to the company. It was clearly established that Bailey ivas invested by the ■ company with apparent if not actual authority to issue the note, or at least there was abundant evidence, to justify a jury in reaching that conclusion. In directing a verdict for the defendant the learned trial court said: “ The proof in this case is that the corporation did not have the benefit of the money. It was a corporation note. It is perfectly clear what these transactions were. Mr. Bailey issued a corporation note for his own advantage and benefit, -and the proceeds of it came into the corporation simultaneously with his instructions to pass it to his personal credit, and néver rested but for a moment to the credit of the treasury of the corporation.” The payee of the note, Hotchkiss, testified positively that he had no knowledge at the time of the' loan that any part of the money was, or was to be, used by Bailey for his own purposes, and we do not think the case contains sufficient evidence to support a finding to the contrary. As an innocent bona fide holder of an authorized note he could collect it from the company although the proceeds were used without his knowledge in the manner stated by the learned trial court.
It follows that the judgment and order should be reversed.
All concurred.
Judgment and order reversed and new trial granted, costs to ‘ abide the event. 1;