Court Opinion

ID: 5413180
Source: CourtListenerOpinion
Date Created: 2022-01-08 16:12:36.429359+00
Date Added: 2024-06-11T08:30:53.526081
License: Public Domain

Bijur, J.
The plaintiff sued the defendant on an indorsement of a promissory note made by one Leonard to the order of the plaintiff. It is conceded that the defendant corporation was merely an accommodation indorser. Plaintiff’s claim that defendant was a guarantor as well as an indorser need not be considered, in face of the express provision of section 113 of the negotiable Instruments Law and -the fact that the indorsement is a bare unqualified indorsement.
*76It is not necessary to determine whether the learned trial judge was justified in believing that the defendant had received due notice of protest, although non-receipt of such notice is strenuously insisted upon by the defendant.
The indorsement is plainly ultra vires as,to.the defendant corporation. It is not pretended that the corporation has any such power by its- charter, and the indorsement was not made or given in connection with any business transaction with the defendant. It was purely for the accommodation of Leonard, who happened to be one of its customers. The fact that he gave a second mortgage on some chattels to the defendant, as security for the liability supposed to be incurred by the indorsement, does not modify the ultra vires character of the act. Rational Park Bank v. German American M. W. & S. Co., 116 N. Y. 281; Fox v. Rural Home Co., 90 Hun, 365; affd., 157 N. Y. 684. See also 10 Cyc. 1109. '
Judgment reversed and new trial ordered, with costs to appellant to abide the event.
Seabury and Guy, JJ., concur.
Judgment reversed and new trial ordered.