Coral Gables, Inc. v. Granara

• Decision Date: 26 March 1934
• Citation: 285 Mass. 565,189 N.E. 604
• Parties: CORAL GABLES, Inc., v. GRANARA et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

285 Mass. 565

189 N.E. 604

CORAL GABLES, Inc.,

v.GRANARA et al.

Supreme Judicial Court of Massachusetts, Suffolk.

March 26, 1934.

Appeal from Superior Court, Suffolk County; Williams, Judge.

Suit in equity by Coral Gables, Inc., against Andrew J. Granara and others. From a final decree for plaintiff, and from a subsequent interlocutory decree, entered after the appeal from the final decree, increasing the ad damnum of a writ in which the bill in equity was inserted, named defendant appeals.

Affirmed.

John Jackson Walsh, of Boston, for appellant.

E. J. Flavin and D. J. Cohen, both of Boston, for appellee.

WAIT, Justice.

This is a bill in equity seeking to reach and apply a second mortgage alleged to belong to the defendant Granara in payment of a promissory note upon which Granara is alleged to be liable. The original bill alleged that Granara executed the note on or about February 4, 1925. By amendment, this was changed to allegations that, on or about February 4, 1925, Granara, by one acting as his agent or representative in the course of his employment and within the scope of his authority, caused the note to be executed; and thereafter, appreciating and recognizing the obligation represented by the note, ratified and adopted it, thereby obligating himself to pay it. The answer to the amended bill denied that Granara executed or authorized the execution of the note, or, after the execution, ratified its execution; and alleged that he was informed and believed the execution by an unauthorized person was a mere formality known to be such by the payee, that the payee and his assigns knew and acted on the knowledge that Granara's name was used without his authority for the benefit of a corporation not empowered to do business until after the making of the note. It alleged, further, that the payee took with knowledge of the circumstances set out. An ‘agreed statement’ was filed which stated as follows: About February 4, 1925, the note referred to in the bill was delivered for valuable consideration to Merrick. It was complete and regular on its face. $3,375 has been paid on the principal, and $642.95 as interest. It was transferred to the plaintiff before maturity for valuable consideration, and, at the filing of the bill, it was held by the plaintiff as a holder in due course. It was given in payment of a balance under a written contract for a deed of real estate at Coral Gables, Fla., in which Merrick, the payee, was vendor and Granara vendee. The plaintiff now holds this contract with a marketable title to the property, ready, willing and able to convey in accord with the agreement. Granara assigned the contract on June 29, 1925. ‘The only question for the consideration of this Court is one involving the genuineness of Andrew J. Granara's signature and/or execution by Granara of the note in suit; and it is agreed that if Granara is liable on the note’ then certain things are to follow. ‘It is agreed further that nothing herein shall be construed or intended to prevent either party from offering facts and evidence in addition to these submitted which will directly or by inference enable the Court to determine whether Granara is liable on the note.’ Other facts and evidence were offered. There is no merit in the contention that the court was in error in admitting them; that its power was, by the agreement, limited to listening to an offer, a contention that where facts are agreed, the court must confine itself to those stated. The true interpretation of the agreed statement is that the court is not confined to the facts recited as agreed; but, while bound to accept what has been agreed as indisputably true, it is at liberty to hear and pass upon other competent evidence calculated to assist in deciding whether, in law, Granara is or is not liable.

The judge found as further facts: For some time before 1925 Granara and others, residents of Massachusetts, were owners of a voluntary trust called the Equity Realty Trust. They planned to deal in Florida lands through a corporation to be formed in Florida. Three of them, Cooper, Fitts and Walsh, went separately to Florida to negotiate purchases for the new corporation. They obtained a charter for the Florida Boston Company issued on January 28, 1925. Under the laws of the State, this corporation could not do business until its charter and by-laws were recorded. Record was made on February 27, 1925. In late January and early February they negotiated for purchase of several lots at Coral Gables, taking titles in their several names to be turned over to the new corporation when it was able to do business. Among these was the real estate referred to in the bill. This they decided to deal with in Granara's name. The purchase price was $13,500 on which $500 cash was to be paid down, $2,875 to be paid by a note due on or before March 3, 1925, and the balance $10,125 by a note payable in twelve quarterly instalments of $843.75 each with interest at 7 per cent. On February 3, 1925, Granara left at Walsh's office in Boston a check, drawn on January 29, payable to Walsh's order, and on February 4 authorized Walsh to borrow on his Equity Realty Trust stock to obtain money to be used with the $500 check in the Florida transactions, not for purchase of specific lands for Granara, but for stock to be issued to him by the Florida Boston Company. On February 4, 1925, Walsh paid $500 to the vendor Merrick by his check drawn to order of Granara and indorsed by Walsh who signed Granara's name as indorsee. He signed Granara's name to the $2,875 note, to the $10,125 note, and to a contract for purchase of the land which all bore date February 4, 1925. On March 3, Walsh had the $2,875 note paid through banks, in the name of Granara. Under date of March 13, 1925, Merrick wrote Granara enclosing the canceled note for 2,875, receipt for the $500 and a copy of the contract. Granara received the letter on March 17, 1925, and, through it, his first knowledge of what had been done with his name. He went at once to Walsh ‘to find out about it,’ and was told all about the entire situation. He made no protest or objection. He never communicated to the holder of the note any objection to its validity. He and his wife joined in an assignment of the contract on June 29, 1925, in which he covenanted that he was lawful owner, had good right to sell and assign and would make further assurances to perfect the...