Chase Nat. Bank v. Chapman

Decision Date25 March 1935
Docket Number31604
CourtMississippi Supreme Court

Division B


General agent has no implied authority to bind principal by making accepting, or indorsing negotiable paper, unless such authority necessarily exists from powers expressly conferred.


If business carried on by agent necessitates the borrowing of money in order to carry it on, power to borrow money is impliedly conferred as a necessary incident to the employment.


Whether husband, to whom wife committed exclusive management of plantation, had implied power to borrow money to carry on operations held for jury.


Whether plaintiff against whom verdict was directed was entitled to directed verdict could not be considered on appeal, where plaintiff had not asked for directed verdict.

HON. S F. DAVIS, Judge.

APPEAL from the circuit court of Sunflower county HON. S. F. DAVIS Judge.

Action by the Chase National Bank against C. B. Chapman. From a judgment for defendant, plaintiff appeals. Reversed and remanded.

Reversed and remanded.

Cooper & Thomas, of Indianola, for appellant.

Much must depend upon the position of the agent and the circumstances of the case, and the agent's authority to execute or endorse commercial paper will be presumed whenever such power is reasonably necessary to effectuate the main object of the agency. It has often been held that the power to conduct the principal's business as the principal might do, includes the power to make and endorse negotiable paper when the nature of the business is such as to require it.

21 R. C. L., Principal and Agent, sec. 39, page 863; Security Savings Bank v. Smith, 38 Ore. 72, 62 P. 794, 84 Am. St. Rep. 756; Helena. National Bank v. Rocky Mountain Tel. Co., 63 Am. St. Rep. 628.

Wherever an agent is empowered to do a particular thing, he is also empowered to use the means necessary to accomplish it.

Consolidated Nat. Bank v. Pacific Coast, etc., Co., 95 Cal. 1, 29 Am. St. Rep. 85; 59 L. R.A. 657, 660; 34 L.R.A. (N.S.) 440; Lytle v. Bank of Dothen, 26 So. 6, 9; 12 A.L.R. 103, 104 and 105.

Mr. Chapman was no ordinary agent; none of the familiar plantation manager cases are in point, and none of the cases involving ordinary agents are relevant.

Mr. Chapman was the unqualified, all comprehensive, general, exclusive, universal agent for all purposes, without reservation, limitation or exception.

With her knowledge he for years was endorsing her name to negotiable instruments.

Unless our silence could be construed into an agreement that section 1943, Code of 1930, has no application to the facts of this case, we have not intended to agree that such statute has no application. It is true that we thought, and still think, that separate and apart from the statutory agency of the husband, we have presented a set of facts of universal agency which render the wife liable on the notes signed by her husband.

Section 1943, Code of 1930, has in substance been a part of the law of Mississippi for several generations, since the emanicipation of women.

Porter v. Staten, 64 Miss. 421, 424; Ross v. Baldwin, 65 Miss. 570, 5 So. 110; Brooks v. Barkley, 72 Miss. 320, 18 So. 419; McCormick v. Altneave & Co., 73 Miss. 86, 19 So. 198; Gross v. Pigg, 73 Miss. 286, 19 So. 235; Johnson v. Jones, 82 Miss. 483, 34 So. 83; Holden v. Rice, 96 Miss. 425, 51 So. 895.

The statute makes the wife liable where the business is carried on, with her means, in the name of her husband.

Rivers v. Wade Hardware Co., 151 Miss. 163, 117 So. 259.

The fact that P. C. Chapman himself signed these notes does not prevent Mrs. Chapman from being liable on the note signed by him. It would certainly destroy the purpose and intent of this statute to permit the wife to evade her obligation, which would be unquestioned if there had been no note, because forsooth there was a note given by the agent.

Rivers v. Eastman Cotton Oil Co., 132 So. 327.

Moody & Johnson, of Indianola, for appellee.

This is not a suit based on the statute (section 1943, Code of 1930), but is a suit on two promissory notes alleged to have been executed by the appellee, and the execution of which is denied by her under oath.

The record discloses that there was no agreement between the defendant and her husband for him to manage or operate her plantation, or that she ever authorized him so to do, but according to her testimony he simply took the property and handled it.

The Negotiable Instrument Act, among other things, provides that the instrument must be in writing and signed by the maker (section 2657, Code of 1930); that no person is liable on the instrument whose signature does not appear thereon, except as otherwise expressly provided in the act (section 2674). The exception mentioned is in section 2675, which provides that the signature of any party may be made by a duly authorized agent, and no particular form of agreement is necessary for this purpose, and the authority of the agent may be established as in other cases of agency.

It is a fundamental principle that the relation of agency can exist only by the will of the principal and with the consent of the agent.

2 C. J., page 432, sec. 26.

In this case no express agency is proved. To the contrary an express agency is negatived by the testimony.

An implied agency must be based upon facts and facts for which the principal is responsible; and upon a natural and reasonable, but not a strained construction of those facts, as the facts must be such as naturally to lead another to believe in and to rely on the agency.

2 C. J., pages 436, 438.

In order to bind the wife by the acts of her husband, it is essential that she shall have previously authorized him to act as her agent, or subsequently with knowledge of the act ratified or adopted it.

30 C. J., page 620; Partee et ux. v. Stewart, 50 Miss. 717; Treadwell v. Hearndon, 41 Miss. 38; Meyer, Weis & Co. v. Baldwin, 52 Miss. 263; Fairly v. Nash, 70 Miss. 193, 12 So. 149.

This suit is not predicated on the statute. The declaration is a declaration in the usual form on two promissory notes, and nowhere therein is the statute referred to, nor does it contain allegations that would bring the case within the purview of the statute.

30 C. J., page 620.

Where an action does not lie at the common law, but is given by statute, it is necessary to show by the averments in the declaration, that it was given by the statute, and comes within its purview.

Scott v. Peebles, 2 S. & M. 546; Clopton v. Matheny, 48 Miss. 285.

As the plaintiff in the court below did not state in its declaration facts necessary to inform the court that its case was within the statute, it cannot now on appeal invoke the statute, and have the case decided on an entirely different cause of action from that sued on in the court below.

I. C. Ry. Co. v. Sumrall, 51 So. 545, 546.

There is not a scintilla of evidence of a contract between the husband and the wife disclosed by the record in the instant case. Hence this case must be considered, even if the statute applies, as one where the husband operated the wife's plantation and carried on business in his own name or on his own account as a consequence of which he is, as to all persons dealing with him, deemed and held to be the wife's agent and manager in business of the operation of said plantation.

Porter v. Staten, 1 So. 487, 489; Lea v. Bank, 72 Miss. 317, 16 So. 431.

A man may, with or without consent, take charge of his wife's plantation and carry on that business in his own name and on his own account, and, as to third persons, the wife may be bound as an undisclosed principal. Yet, the wife, as such, is only bound by what the husband does within the scope of his agency in carrying on her business in his name. Surely the statute never intended to make the wife liable for anything the husband does in his name, or even in her name, that had no connection with the wife's business, or what was not necessary in carrying on her business.

Gross v. Pigg, 73 Miss. 286, 19 So. 235; Dean v. Byrd, 86 Miss. 204, 38 So. 287; Rivers v. Wade Hdw. Co., 117 So. 259.

An agent having general authority to manage his principal's business, has, by virtue of his employment, no implied authority to bind his principal by making, accepting or endorsing negotiable paper.

%Fairly v. Nash, 70 Miss. 193, 12 So. 149.

Argued orally by Forrest G. Cooper, for appellant, and by Elbert Johnson, for appellee.


Anderson, J.

Appellant brought this action in the circuit court of Sunflower county against appellee on two promissory notes dated November 3, 1931, one for one thousand forty dollars, and the other for one thousand fifty-four dollars and fifty cents, alleged to have been executed by appellee to the Bank of Indianola and transferred to appellant by that bank. The notes appeared to have been executed by appellee and P. C. Chapman; appellee being the wife of the latter. Appellee filed a plea of non est factum properly verified. At the conclusion of appellant's evidence, on motion of appellee the evidence was excluded and the jury directed to return a verdict for appellee, which was done, and judgment accordingly entered. From that judgment appellant prosecutes this appeal.

Appellee was the wife of P. C. Chapman, who died previous to the bringing of this suit. The name of the wife was signed to the notes sued on by her husband. The notes were also signed by him. Appellant's contention is that P. C. Chapman had at least implied authority to execute the notes for his wife. The court necessarily held that the evidence showed there was no such authority, otherwise...

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