Bryant v. Lord

By the Court. Ripley, Ch. J. We discover nothing in this case, as settled, which would take Taylor’s endorsement of the name of “Lord,'Taylor & Co.” on the note of Pratt-to Bruce or bearer out of the general rule, that after dissolution one of the late firm has no authority to bind the others by such an endorsement. The case of Lange vs. Kennedy, 20, Wisc. 279, holding that after dissolution one of the late firm cannot bind the other by giving to a party, who has notice of such dissolution, a note in the firm name for a balance due on partnership dealings, is in point. There is no evidence of any antecedent authority to Taylor from the other partners thus to bind them, nor any of any ratification. The allegations in the answer, that, on and after a settlement, and a delivery by defendants to plaintiff of all property of his in their hands, he claimed there was a balance due of $70.05, and that, on April 12, 1870, the defendant Taylor, for the purpose of settling and - paying the balance so claimed, endorsed and delivered the said note to plaintiff, and that plaintiff received said note in payment of said balance, and not in pursuance of any contract whatever, is only to — 402 — meet the allegation of the complaint that said note was endorsed and delivered under the contract. On this account, therefore, the plaintiff’s position, that the presentment, protest and notice of protest of said note entitled him to judgment against defendants on that note, seems to be untenable; and if the seventh finding of fact must, as we think it must, be taken to mean that the defendants endorsed the said note, it is against the evidence. Of this, however, the defendants, not having appealed, can have no benefit. But the referee finds that no notice of presentment and refusal of payment was ever served upon the defendants. As he does not find in terms that the note was duly presented for payment, unless this finding implies it, the facts to charge defendants are not found. But no implication that a certain thing had been done necessarily arises from a statement that no notice was given that it had been done. We cannot supply the omission of the referee to find upon this material point. The plaintiff should have applied to the referee for a supplemental finding. Conklin vs. Hinds, 16 Minn. 457. As the case stands, therefore, the defendants are entitled to judgment in respect of this note, and it is unnecessary to consider whether or not the evidence justifies the actual finding of the referee as to notice. It is by no means clear how the referee is to be understood with reference to the notes, which are the subject of this suit, in finding that the agreement was cancelled on Feb. 10, 1870, and the parties had a settlement and accounting of all matters remaining unsettled between them under the terms of the contract, and there Avas found due to plaintiff from the defendants the sum of $70.05. This language, however, cannot be rationally construed to include among such matters any future conditional liability of defendants as endorsers of the two notes not then due ; and — 403 — if it was meant to include those then due, the answer sets up no such settlement, and the evidence is against it. Lord’s deposition contains the only testimony as to any settlement. He simply says that, on notice, “ the plaintiff’s agent came on and settled up the business, taking away the machines and parts on hand.” Considering the answer, the provisions of the contract on the point of settlement, and the nature of the business carried on by defendants, it would be a forced construction of this, testimony, if it stood alone, to say that by this language the witness meant that the settlement had reference to any such liability as is sought to be enforced against defendants in this action. But it must be taken in connection with the rest of defendants’ proof. They put in evidence a letter from plaintiff to Lord, dated March 4, 1870, in which he demands payment of the balance of Lord, Taylor & Co.’s account, (evidently referring to said balance of $70.05,) and hands him a list of overdue notes, including the two above mentioned, saying that they “must now be taken care of, and that he must request Lord to have them lifted at once,” etc. But if the settlement had included such claims upon defendants, they had been “ taken care of,” and plaintiff knew it. Taylor, moreover, testifies that the balance claimed by plaintiff of him. in April as due to him from the firm, and shown by the books of the company, was about $70. This is certainly the balance found due when the agent “ settled up the business,” i. e., upon the settlement and accounting of the 7th finding. As the sum appeared to be due upon the books of the firm, (which came to an end on January 12th,) there can be no doubt whatever that it was the balance due from defendants upon sales and collections for plaintiff. If the referee’s conclusions of law, that the defendants are — 404 — entitled tó judgment, can be sustained, it must be upon the 1st and 5th findings of fact. The letters of plaintiff to defendants, (Exhibit E.) and their reply under date of June 3, were properly admitted in evidence. Upon the point, whether or not the plaintiff had agreed to any, and what, modification of the contract, the whole correspondence was as clearly admissible as the whole of a conversation would have been. The objection, that the' promises contained in said exhibit appear to be without consideration, if well founded, was no reason for excluding it. • It was a part of the written conversation. If the effect of the whole correspondence, and the-subsequent acts of the plaintiff, is, as defendants allege, to show that they refused to go on with .the business under the contract, unless the contract was so modified as to do away with those provisions which made it an absolute and 'unconditional guaranty by them of the notes they endorsed, and that thereupon the plaintiff agreed to such modification, such agreement would be upon a valid consideration. Monroe vs. Perkins, 9 Pick. 248. Whether or not the weight of evidence was, as the plaintiff alleges, against the letter of June 3d having been received by him, was for the referee. As to whether the evidence justifies the finding, the question is not as to the weight of the evidence, but whether there is evidence reasonably tending to support it. Humphrey vs. Havens, 12 Minn. 298. That defendants were to have “ due notice of non-payment and protest of each and all ” of the notes endorsed and delivered by them under said agreement, certainly means that they were to have due notice of protest. This implies an obligation on plaintiff’s part to protest them. There is no evidence to show that plaintiff assumed any such obligation, and the fact found by the referee, that he did not protest the notes, furnishes no ground for the conclusion of law that defendants — 405 — are entitled to judgment. Exhibit E makes it quite clear that plaintiff supposed that a protest was necessary to charge the endorsers of these notes. But this was an error, and apart from any agreement, a protest was entirely optional, the only advantage resulting to him therefrom being that the notary’s certificate was by statute prima facie evidence. Gen. Stat., ch. 26, s. 9 ; Edwards on Bills, p. 469. It is certain, however, that Exhibit E contains no promise by plaintiff to protest any note. Whether the defendants shared the impression aforesaid of the plaintiff, is not quite clear ; but it is entirely clear, that, whether they did or not, they did not'stipulate for protest, and that there was no agreement made to that effect by the parties. The most favorable view of the evidence possible for defendants is, that the contract was so modified that the defendants’ contract of guaranty aforesaid of the notes to be endorsed by them was changed into the conditional contract of an endorser, a contract which would involve no obligation on plaintiff’s part to protest them. Assuming that the finding, upon the principle that the greater includes the less, includes such a modification, from the fact that the notes must be presented for payment before the}? could be protested, the plaintiff contends, nevertheless, that the defendants waived the benefit of such agreement in respect of the three notes in the body of which it is specified that “ the drawers and indorsers jointly and severally waive presentment for payment, protest and notice of protest and non-payment of this note.” This question has been passed upon in Indiana and not elsewhere, so far as our observation extends. It is there held that such a waiver in the body of a note or bill of exchange is operative against indorsers. Where the words “ protest and notice of protest waived,” appeared in the body of the note, the court held that they were inserted for some purpose; — 406 — the only purpose could be to waive protest and notice as to indorsers, for they were the only parties as to whom these acts were required. Gordon et al. vs. Montgomery, 10 Ind. 110. In a subsequent' case, in which the appellants indorsed a bill of exchange which contained these words, “ notice and protest of non-acceptance and non-payment waived,” it was held, that the waiver affected the contract of the indorser as well as the drawer, that it formed part of the note, and the indorser is deemed to have adopted it by his indorsement. Lowry vs. Steele, 27 Ind. 168. In the case at bar, the purpose to affect the contract of the indorser is expressed. As the first endorser of a note holds much the same position as drawer, and the maker much the samé as the acceptor of a bill of exchange, we are unable to see why the doctrine of these cases is not correct as applied to these indorsements. If the defendants, then, under the modified contract, were to occupy the position of indorsers only in respect of any notes which they might indorse, it is not easy to see why, if they chose to waive demand and notice upon all or any of the notes they indorsed, such waiver is not as binding upon them as it would be upon any other indorser. Upon the construction above stated of the first finding of fact aforesaid, and the most favorable possible for defendants, it would seem that the plaintiff would be entitled to recover upon these three notes. The judgment must be reversed and a new trial had.