Burkhalter v. Perry & Brown

Evans, J. (After stating the facts.) The note which is the basis of the plaintiffs’ suit is not a contract under seal. While ■after each signature there is the device “(L.S.),” still there is no recital in the face of the instrument that it is to be under seal. In order to render a promissory note a sealed instrument, it must •be so recited in the body of the note; the mere addition of a seal, ■or a device “(L.S.),” after the signature of the maker is insufficient. Jackson v. Augusta Sou. R. Co., 125 Ga. 801. For the present we will not stop to inquire whether the instrument sued •on loses its otherwise negotiable character on account of the recital therein that its consideration is for supplies to be furnished in futuro. Indeed, under the view that we take of this case, it is unnecessary to determine whether the instrument is a negotiable promissory note, or merely a simple contract to pay money. The general rule of law is that if an agent sign a note with his ■own name alone, and there is nothing on the face of the note to show that he is acting as agent, he will be personally liable on the note, and the principal will not be liable. If an agent make a mote in his own name, and add to his signature the word “agent,” •and there is nothing in the note to indicate who is the principal,' the agent will be personally liable, just as if the word “agent” was not added. Graham v. Campbell, 56 Ga. 262. If the suit had been against D. C. N. Burkhalter, he would not have been permitted to shift his responsibility by showing that the note was not in fact his own note, but that of the principal. 'The addition of the word “agent” was simply descriptio person®, and the note would be his individual obligation. Another and entirely different •question is presented when the suit is against the principal and the declaration contains appropriate allegations that the note sued ■on was the note of the principal, signed by his duly constituted .agent, with intent thereby to charge the principal. See Crusselle v. Chastain, 76 Ga. 840. Where it appears from the face of the paper that the credit is not given to the agent, and the name of the principal is disclosed at the time of the transaction, though not stated in the paper, and the act is within the powers of the agent, [442] the principal is bound. It matters not whether the agent may also be bound, for there are cases where both principal and agent may be bound. Merchants’ Bank v. Central Bank, 1 Ga. 429. The rule seems to be general, that under appropriate pleading, where a contract in writing not under seal, and other than a negotiable instrument, is made in another name than that of the real principal, the real principal can sue and be sued. Beckham v. Drake, 11 Mees. & Wel. 315. It may possibly require some subtlety and refinement of reasoning to take this principle out of the operation of the rule that a written instrument can not be added to, varied, or explained by parol. However, the distinction is firmly established in our jurisprudence, and is in the interest of fair dealing, that the real party to the contract, though his name may not appear therein, in the adjustment of disputes arising out of that contract between the contracting parties, should be allowed both to sue and be sued. Metcalf v. Williams, 104 U. S. 93, 96. This is especially true where the word “agent,” “trustee,” or ‘•'general manager,” appears after the signature of a party to the contract. “A contract signed by a person who adds after his signature the words ‘general manager/ is not the individual undertaking of the person signing, if ... in a suit for its breach, this fact appears by extrinsic evidence.” Raleigh R. Co. v. Pullman Co., 122 Ga. 700. A well-recognized exception to the general rule stated springs from the law merchant. Where a negotiable instrument is executed by an agent without sufficiently indicating on its face who the principal is, parol evidence can not be introduced to charge the principal, although he executed the instrument as agent and added the word “agent” to his signature. This exception to the rule is based upon the reason that “each party who takes a negotiable instrument makes his contract with the parties who appear on its face to be bound for its payment. It is a ‘courier without luggage/ whose countenance is its passport; and in suits upon negotiable instruments, no evidence is admissible to charge any person as a principal thereto, unless his name in some way is disclosed upon the instrument itself.” 1 Clark & Styles on Agency, §328a; 1 Daniel Neg. Inst. §303. But. this exception in favor of negotiable instruments itself contains an exception; and that is, as between the immediate parties to a bill or note, it may be shown [443] by parol that the instrument was, to the knowledge of the parties, intended to be the obligation of the principal, and not of the agent, and that it was given and accepted as such. Metcalf v. Williams, supra; Mechem on Agency §443. The reasoning in Bedell v. Scarlett, 75 Ga. 56, at first blush, would seem to militate with this view. In that case the plaintiff sued Bedell as maker of a bill of exchange signed “J. K. Bedell, Ag’t.” The maker pleaded that the draft was given in payment for timber purchased by the maker as the agent of the drawees, and that ho had no interest in the timber; and that these facts were well known to the plaintiff when he purchased the draft. The question before the court was whether the facts alleged in this special defense were sufficient to discharge the actual signer (the agent) from liability. Parol evidence to sustain this plea was excluded by the trial judge, and on a review of the case this court affirmed that ruling. The agent could not shift his liability to his principal by proving these facts, according to the rule stated in Graham v. Campbell, supra. This decision must be interpreted in the light of the question before the court. The distinction between that case and the one at hand is that in the former the suit was against the maker who signed his name as “agent,” and who was trying to evade liability by an attempt to show that the contract was not his, but that of his principal; while in the present case the principal is sought to he made liable on her contract, entered into by.her duly authorized agent. We stated in the beginning that it was unnecessary to decide whether the note sued on was a negotiable instrument, or a plain contract in writing. The present controversy is between the original parties to the instrument, and clearly comes within the exception to the rule above stated as applicable to negotiable instruments. The pleader in the original suit declared on the note as being the contract of Mrs. Burkhalter, alleging that it was executed by her because it was signed by her husband as her agent, intending thereby to make her alone responsible. The amendment amplified the allegations of the petition respecting her liability, and did not introduce a new cause of action. We think that the petition as amended contained a cause of action against Mrs. Burk-halter, and upon proof thereof that she would be liable on the note [444] ¡signed by her husband as “agent.” Moore v. McClure, 8 Hun, 557. It may be contended that even if a principal may be liable on ¡a note signed by the agent, with the word “agent” after his signature, with proper allegations that the contract thus signed was the contract of the principal, and that the signature in this manmer was intended by both parties to be the signature of the prin•cipal, the rule would be inapplicable where there were other persons jointly bound on the same note, who are sued as joint obligors. ’Unquestionably the joint obligors might object to an amendment •of this character. They have a right to rely on the legal import and effect of the instrument as signed by them. Relatively to them, the addition of the word “agent” to the signature of Burk-halter was mere deseriptio personae, and they could insist that they had the right to hold him liable to contribution in the event the, paid the debt, and that the plaintiff could not substitute ¡another as being jointly liable with them under the contract, over their protest. This objection, however, is pérsonal to the joint •obligors. It is no concern of Mrs. Burkhalter. She is not hurt by treating the contract as hers, simply because other persons may be jointly liable with her thereon. The fact that there may 'be others from whom she might demand contribution is to her -advantage, and not to her detriment. The evidence submitted by the plaintiffs fully sustained the -allegations of their petition. Mrs. Burkhalter’s liability was shown to be primary, and not as security. As she offered no testimony, and there was no conflict in the evidence submitted by the plaintiffs, there was no error in directing a verdict for the plaintiffs. Judgment affirmed. All the Justices concur, except Fish, G. J., .iabsent.