Hayes v. Crane

Gilpillan, C. J. This action is to enforce specific performance ■of a contract to convey real estate. Wilkins & Smith executed to this plaintiff a mortgage upon 10 different pieces of real estate, and they afterwards made an assignment of all their property to this defend■ant for the benefit of their creditors, and he accepted the trust. When the mortgage fell due the plaintiff brought an action to fore■close it against Wilkins & Smith and this defendant as such assignee, .and a judgment of foreclosure was entered adjudging the amount due ■to be $11,030, and directing a sale of the property to satisfy it. Pursuant to the judgment the property was advertised for sale on May 14, 1887. On the 13th day of that month the plaintiff and defendant entered into a contract in writing, reciting the judgment, and setting forth the notice of sale, and by which plaintiff covenanted to assign to defendant the sheriff’s certificates of sale, and, in consideration thereof, the defendant covenanted to pay to plaintiff $11,030 on May 14, 1888, with interest at the rate of 7 per cent, per annum; and the contract contained a provision that, if the plaintiff should •not obtain a sheriff’s certificate of sale of all the property, then the ■defendant should pay, for an assignment of so much thereof as plain [43] tiff should obtain, certain sums agreed on for the several tracts. At the sale all the tracts were sold to the plaintiff at the aggregate price of $11,030, and the proper certificate was issued to him. Afterwards the plaintiff assigned to defendant the certificate of sale as to certain of the tracts, and defendant redeemed from the sale as to certain other tracts, and plaintiff offered to assign the certificate as to the remainder upon defendant paying him therefor the aggregate of the prices agreed on in said contract for such remaining tracts. Defendant refused to take and pay for the assignment of the certificate as to the remainder, and the action is to enforce the contract as to such remaining tracts. The court in which the insolvency proceeding was pending never authorized defendant, as assignee, to make the contract, and never ratified or confirmed it. The court below held the contract ■to be that of defendant as assignee, and that he is not personally bound upon it. If this conclusion is correct, it is the end of the ease, for the action is against the defendant personally. Whether the defendant contracted in his personal capacity or in his capacity of assignee is to be determined by the contract itself. There is a line of decisions, commencing with Pratt v. Beaupre, 13 Minn. 187, (Gil. 177,) holding that where such a word as “agent,” “trustee,” or the like is affixed to the name of a party contracting, the word is to be taken as prima facie descriptive only of the person and to identify him, but that it may be shown by parol for what purpose the word was so affixed, whether as descriptive or as determining the character in which the party contracted. Such proof is admitted, not for the purpose of defeating the .contract, — of showing that no one is liable upon it, — but to show whose contract it is; and to establish that the contract was made in a representative capacity the party must prove the representative character, and that he had authority to make the contract in that character. Peterson v. Homan, 44 Minn. 166, (46 N. W. Rep. 303.) It may also be stated that where the written contract clearly expresses the character in which the party made it, parol evidence on the point is not only unnecessary, but is inadmissible. We think this contract does so express it. In the description of the parties defendant is described as “Frank I. Crane, as assignee, party of the second part; ” in the notice of sale incorporated in the contract he [44] is described as “Frank I. Crane, as assignee of W. T. Wilkins and Fay E. Smith;” in the only covenant where the name is given it is “said Crane, as assignee;” he signed the contract, “F. I. Crane, Assignee.” It appears whose assignee he was, and also that the subject-matter of the contract — the real estate — was the property of his trust, so that he could not in his personal capacity acquire and hold, as against those interested in the trust, any interest in the property, though he could, with the consent of the court, acquire and hold it as assignee. Many of the cases holding such contracts to be personal contracts have overlooked the significance of the word “ as,” immediately preceding the one indicating representative character. We think ordinarily, and unless there be something in the writing to show the contrary, the word must be taken to have been used for a purpose, and that the only purpose of it is to express the character in which the party makes the contract. When so used it is equivalent to the expression, “in his character of.” It is true that in this contract the covenants on the part of the plaintiff are expressed to be to the defendant, “ his heirs and assigns,” instead of his “ successor in office.” But those words, which are often inadvertently used instead of the latter or other similar words, are not sufficient to show that the contract was not made as assignee. The rule of construction that the parties attempting to make a contract are presumed to-intend that it shall be effectual and valid, and that the language-used must, if it will admit of it, be interpreted to sustain, rather than defeat, such presumed intention, does not apply where, they have-clearly expressed themselves, so that, taking all the terms used, in connection with the subject-matter and the circumstances in which the parties stand, blit one meaning can be attributed to them. In such case the court will not, even to sustain the contract, give a meaning contrary to what they have expressed. That would be making a contract for them when they have failed to do so. The contract was therefore on its face that of defendant as assignee, and not his individual contract. But he had no authority to make it as assignee without leave of the court, for it involved the employment of funds in the hands of the assignee that it might not be for the inter45 eat of the trust to so use. The court might previously authorize such a contract, and, because it might be of benefit to the trust, it might, on application of a party to it, if not previously authorized, subsequently ratify it, and direct the assignee to perform it. Such application would have to be made in the insolvency proceeding, so that the court might give the parties to and interested in that proceeding an opportunity to be heard. There is a great diversity in the cases as to the proper remedy against one who, without authority to do so, assumes to make a contract in a representative capacity, as in that of an agent, especially where the want of authority is not known to the other party to the contract; some cases holding that he may be sued upon it as his contract, others that he may be sued as upon an implied contract that he had the authority he professed to have. Cases of the former class are open to the objection that they make the contract that of A., when by its terms it is the contract of B. Without attempting to review the various decisions, we conclude it to be most in accordance with principle, and also with the more numerous and best-considered cases, that the party contracting in a representative character cannot, as a general rule, be sued on the contract itself as his contract. 1 Chit. Cont. 314; 1 Pars. Cont. 68, and .cases cited. There may be exceptions to this rule. In the case of an administrator or executor there seems a pretty uniform concurrence of decisions that by contracting in his official character when he has no authority to do so he becomes personally bound on the contract. The action being against defendant personally on the contract, and he not being personally liable upon it, the action must’fail. It is therefore unnecessary to consider any other question in the case. Order affirmed. (Opinion published 50 N. W. Rep. 925.)