Russel v. People's Savings Bank

Cooley, J. The suit against Mrs. Russel in the court below was upon a contract of indorsement. It appears that the Detroit Car Works, a corporation in which she was a stockholder, was indebted to the Savings Bank upon a note which was about to be sued, and that to [673] prevent suit she indorsed over to the bank a note held by herself against the Hamtramck Iron Works. This last note does not appear to have been received in exchange for the other, though the note against the Car Works was surrendered; but it was held by the bank as collateral security, and as it exceeded the other note in amount, there would have been a balance to return to Mrs. Eussel had it been paid. No payment being made upon it, this suit was brought. When the indorsement was made, Mrs. Eussel was and now is a married woman. Under the statute (Comp. L., § 4803) she was empowered to contract, sell, transfer, mortgage, convey, devise and bequeath her own property and in the same manner and with the like effect as if she were unmarried. Therefore no question can arise respecting her right to transfer the note to the bank by indorsement. Nor, had the transfer been made for any purpose of her own, could her liability on the indorsement have been questioned. She might have purchased property with it, and thus pledged her personal responsibility. Tillman v. Shackleton, 15 Mich., 447; Campbell v. White, 22 Mich., 178; but affirmative proof that the'contract concerned her own estate would have been essential. Powers v. Russell, 26 Mich., 179; Emery v. Lord, 26 Mich., 431. But a contract of suretyship is not one by which the woman contracts, sells, transfers, mortgages or conveys her own property or any part of it. She sells nothing by it, buys nothing by it, gives a lien upon nothing by it. She pledges merely her personal responsibility, having in view only the benefit of another, and not any advantage to her own estate. Such a contract is therefore not within the words of the statute. Neither is it within the spirit of the statute, for that had in view the relieving of the wife from disabilities which operated unfairly and oppressively, and which hampered' her in the control and disposition of her property for the benefit of herself and her family. It was not its purpose [674] to give her a general power to render herself personally responsible upon engagements for any and every consideration which would support a promise at the common law. This has been so fully explained heretofore that nothing further need be said concerning it. DeVries v. Conklin, 22 Mich., 255; West v. Laraway, 28 Mich., 464. But it is said that in this case the suretyship was for the benefit of a corporation in which Mrs. Eussel was a stockholder, and therefore she must be supposed to have had in view in making it her own interest in the corporation. Mrs. Eussel, however, was not identified with the corporation otherwise than as having an interest in it; the legal identity of each was distinct, and contracts for the benefit of the corporate estate were in no sense contracts for the benefit of the estate of one of its corporators. Talbot v. Scripps, 31 Mich., 268. It is true that if it resulted advantageously, it might eventually bring incidental benefit to the stockholders, but on the other hand it might also bring incidental injury; and whether beneficial or injurious, the result would have been indirect and circuitous, following not directly a contract made on her own behalf, but remotely a contract made on behalf of another. It is not enough that such possible indirect benefits are looked for, in a contract of suretyship, for these may be in view in many cases, and especially when the wife becomes surety for the husband. The test of competency to make the contract is to be found in this; that it does or does not deal with the woman’s individual estate: possible incidental benefits cannot support it. Tested by this criterion this contract of indorsement, so far as it involves a personal responsibility, must fail. Mrs. Eussel has contracted for the advantage, not of her own estate, but of a corporation with which she is no more identified in law than she is with her husband or any third person. Even if presumptive incidental benefit could support her contract, it could not be supported under these circumstances, for by pledging her [675] own responsibility for the corporate debt she would only put a large share of her estate at risk in the corporate business, and if any presumption could arise from this, it would be that it was prejudicial rather than advantageous. But there is no occasion to indulge in presumptions one way or the other; it is sufficient that the contract is one of suretyship merely, and as such is not one the statute empowers a married woman to make. The judgment must be reversed with costs, and a new trial ordered. Campbell, C. J. and Graves, J. concurred; Marston, J. did not sit in this case.