Lester v. Webb

Bigelow, C. J. The plaintiff rested his title to the notes declared on upon two grounds, either of which was sufficient to enable him to maintain his action. One was that the notes were transferred to him by the indorsement of the treasurer of the corporation in pursuance of a direct authority conferred on him at a meeting of the directors. There was evidence at the trial which tended strongly to sustain this ground. If such a transfer was made, the plaintiff held the notes by a title clearly legal and valid. The management and control of the prudential affairs of a corporation are by law vested in the directors, [36] who are empowered to make disposition of its property and assets in the usual and ordinary course of its business. In the aspect of the case which was presented by the proof that the indorsement of the notes by the treasurer was in pursuance of a direct authority from the directors, we think the plaintiff was entitled to the instruction for which he asked, and that the jury should have been told that if they believed the evidence on this ooint, the plaintiff held the notes by a title which was in law valid and sufficient. The other ground on which the plaintiff claimed to recover was that the notes were indorsed to him by the treasurer of the corporation; and if he had no authority to make the transfer by any direct vote or action of the directors, he was nevertheless empowered to make the indorsement by virtue of his being the general agent of the corporation for the management of its fiscal concerns, and as having been held out to the world as authorized to make and indorse negotiable paper on behalf of the corporation. Upon this point, also, there was evidence which tended to support the plaintiff’s case. If the jury believed this evidence, it would be their duty to return a verdict for the plaintiff. The rule is well settled, that if a corporation permit their treasurer to act as their general fiscal agent, and hold him out to the public as having the general authority implied from his official name and character, and by their silence and acquiescence suffer him to draw and accept drafts, and to indorse notes payable to the corporation, they are bound by his’ acts done within the scope of such implied authority. Fay v. Noble, 12 Cush. 1. Williams v. Cheney, 3 Gray, 215. Conover v. Mutual Ins. Co. 1 Comst. 290. On the facts proved at the trial, the plaintiff might well claim, if the jury believdd the evidence, that the treasurer had authority to indorse the notes in suit, derived not from any express direction, but from the course of conduct and dealing of the treasurer with the knowledge and implied assent of the directors of the corporation. The error at the trial consisted, not in leaving the question of the authority of the treasurer to indorse the notes declared on to the jury, but in omitting to state, in answer to the plaintiff’s [37] prayer for instruction, what would in law constitute sufficient proof of such authority. The case was left to the jury without any statement of the roles of law applicable to the facts in evidence. On this ground, the plaintiff is entitled to a new trial. Exceptions sustained.