Leonard v. Lent

Ryan, C. J. We affirm the judgment in this case, as we reversed the judgment in M. E. Church v. Sherman, 36 Wis., 404, with regret. There are imperfect obligations in law, which are not imperfect in morals. And such we are constrained to hold the obligation of the respondent in this record. There seems to have been some confusion in this case between the respondent’s liability on his subscription to the church corporation, and on his promissory notes to Mr. Fa88 ville. They appear in the record, to be quite distinct, neither materially affecting the other. An incomplete case upon the subscription, and an incomplete case upon the notes, cannot be put together to make a complete case for the appellant. It is indispensable to a clear comprehension of the case, to consider each apart from the other. Whether or not the subscription would have been valid if the corporation had been a party to it, need not be considered; because the privity of the corporation does not appear. It was argued for the appellant that there was a meeting of the trustees of the corporation, before the subscription was made, authorizing Dr. Hatfield to receive such subscriptions. The evidence is that most, or possibly all, of the gentlemen who were members of the board of trustees, met the evening before, and had some informal conversation to that effect. But it does not appear that all were certainly present or had received notice of a meeting, or that there was an official meeting or action of the board of trustees. And there is no pretense that there was any subsequent meeting of the trustees as a body, formal or informal, to accept the subscription, or to authorize notes to be taken for it, or to authorize them to be made payable to Eaville, or to authorize their transfer to the appellant. Trustees of such a corporation, to bind it, must act officially, at official meetings, or under authority conferred at official meetings. R. S., ch. 66, sec. 12. The construction of this section is stated in United Church v. Vandusen, 37 Wis., 54: “A call is a call of all the trustees, and a lawful meeting is one which all have at least constructive opportunity to attend. A corporation is not represented by every casual meeting of a majority of its governing body. And all the trustees, acting personally, without an authorized and official meeting, could not bind the church. Ang. and Am. on Corp., §§ 231, 489, 491, 492; Dennison v. Austin, 15 Wis., 334; Methodist Church v. Sherman, 36 id., 404.” The records of the corporation were not in evidence. And [89] the appellant argues that there is a presumption that the corporation did all that was necessary to bold the respondent on bis subscription and notes, and that the onus probandi against the presumption was upon the respondent. Omnia prcesum-wntur rite acta donee probetwr in contrarium. It might be enough to say that the presumption assumed appears to be sufficiently rebutted by the parol evidence. If the notes bad been payable to the corporation, and gone into its possession, there might be a presumption of acceptance. But the notes were not payable to the corporation. Tbe answer pleads that they were “ executed to represent ” the subscription, but not that they were made or delivered to the corporation, or to Eaville for the corporation. Tbe possession by the corporation of notes payable to another, if proved, could raise no presumption of acceptance of them by the corporation for its own. And so the onus probandi, that the notes to Eaville were accepted by the corporation, was on the appellant. Tbe trouble throughout is, that the notes, on their face, are disconnected with the subscription. So far, therefore, as the subscription, and the notes regarded as given for the corporation in payment of the subscription, are concerned, this case is clearly within the rule of Methodist Church v. Sherman, 36 Wis., 404. In this case, as in that, “ a contract in form, valid or invalid, was not proved.” Had the notes been given to the corporation for the subscription, and accepted, it maybe that the transaction disclosed in the record would have been a sufficient consideration to support the notes. There would have been at least a contract in form, and the case would not be ruled by Methodist Church v. Sherman. But the notes were made payable to Faville individually, without apparent authority from the corporation. And if they can be upheld at all, it must be in the right of Faville, and not in the right of the corporation. It appears that Faville was under liability for the church [90] building of the corporation; whether officially or personally, we need not stop to inquire. The respondent was interested in the building, expecting use and enjoyment of it. We are not prepared to say that if he assumed a share of Faville’s liability, it might not be a sufficient consideration to support the notes. But the question is not in the case. The difficulty in upholding the notes in favor of Faville is, that it appears that they were not delivered to him. “ Where a bill is originally payable to bearer, and therefore transferable by delivery only, actual or constructive delivery thereof would seem to be indispensable to complete the legal title thereto.” Story on Bills, § 203; Ohitty on Bills, '172; and numerous cases cited in the notes to those works. We scrutinized the evidence closely for facts or circumstances to go to the jury, upon the question of delivery to Faville, or to warrant a verdict that the notes had been constructively delivered to him. But we failed to find any evidence tending that way. These notes were handed by the respondent to Mr. Griswold without direction. There is no pretense that Griswold was Faville’s agent to take the notes — had any authority from Faville in the premises. He might perhaps be considered as the respondent’s agent to deliver the notes to Faville. But he never did so. And if the notes were in his possession as the respondent’s agent, they were in the respondent’s own possession. The respondent might have withdrawn them at any time before delivery to Faville. Brind v. Hampshire, 1 M. & W., 365. In fact, the record sufficiently discloses that there was no privity whatever between the respondent and Faville, as maker and payee of the notes; or that Faville claimed as payee of the notes, or consented to accept them. He plainly regarded the notes as belonging to the corporation, not to himself, and looked upon Griswold as agent of the corporation, not his own, in the possession and negotiation of the notes. When Griswold assumed to negotiate them, no title [91] to them bad vested in any one. They were not contracts. They were papers in the form of contracts, in the constructive possession of the maker, undelivered, and of no validity. And no title in them vested in the appellant by Griswold’s delivery to him; not even if he could be held to have advanced a new consideration for them. So this court has repeatedly held. Roberts v. McGrath, 38 Wis., 52; Roberts v. Wood, id., 60. The mind is naturally reluctant to accept such grounds for escape from moral obligation. But the rules of law are the same, whichever party may have the best claim upon moral sympathy; and they must prevail either way, by their own force, without help or hindrance of sympathy. In a moral point of view, the rule might appear plainer, if Griswold had stained the notes, and either the corporation or Faville had brought trover against him. In that case, uninfluenced by the relations of the respondent and the corporation, it appears to us that there could be little hesitation, in any legal mind, in holding that the evidence which we have here would wholly fail to establish a legal title to the notes, in either the corporation or Faville. By the Court. — The judgment of the court below is affirmed.