Devoy & Kuhn Coal & Coke Co. v. Huttig
| Decision Date | 19 February 1916 |
| Docket Number | No. 30666.,30666. |
| Parties | DEVOY & KUHN COAL & COKE CO. v. HUTTIG ET AL. |
| Court | Iowa Supreme Court |
OPINION TEXT STARTS HERE
Appeal from District Court, Muscatine County; M. F. Donegan, Judge.
Action on a promissory note resulted in a directed verdict and judgment thereon for defendants. The plaintiff appeals. Reversed.D. V. & R. S. Jackson, of Muscatine, and John A. Blevins, of St. Louis, Mo., for appellant.
Jayne & Hoffman, of Muscatine, for appellees.
The action is against Huttig and Blackwell as indorsers on the following note:
Summit Lumber Company, Manufacturers of Soft Short Leaf Yellow Pine Timber.
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¦$1,169.40¦St. Louis, Mo., February 2, 1914.¦
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One month after date we promise to pay to the order of Devoy & Kuhn Coal & Coke Co., eleven hundred sixty-nine and 40/100 dollars at our office, 1014 Wright Bldg., St. Louis, Mo. Value received.
Interest 6 per cent. per annum from date.
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¦No. 2640. ¦Summit Lumber Company, ¦
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¦Due 3/2/14.¦By Aylmer Flenniken, Treas.¦
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Indorsed as follows:
1014 Wright Bldg.
Arkansas Southeastern R. R.,
J. S. Blackwell, President.
J. S. Blackwell,
Muscatine, Iowa.
H. W. Huttig.
A. K. Silverthorne,
North Tonawanda, N. Y.
[1] The note in connection with the certificate of protest by the notary public imported a liability on the part of the defendants, and the only question raised is whether the defenses interposed were such as to justify the trial court in withdrawing the issues from the jury. The note was one of several signed by the Summit Lumber Company in blank and indorsed when in that condition first by Blackwell, and then by Huttig, who sent them to Silverthorne to add his name. Huttig orally instructed Blackwell in relation to the notes, and the latter testified that the note sued on was left with him to assist in financing the Summit Lumber Company.
He then testified that it was given plaintiff to take up a note of like amount of the Arkansas Southeastern Railway Company. On cross-examination he swore that the railway company was hauling logs for the lumber company, that there was an open account between them, and that he “thought that it would be all right to use the Summit Lumber Company note to pay the debt of the Arkansas Southeastern Railway Company and charge it to this account.” He testified farther that he supposed it was so charged, that it should have been, and that as president of the railway company he knew he had taken this on for it “because there was an open account between the two companies.”
Reichert arranged with Kuhn, plaintiff company's president, to take the note sued on in satisfaction of a note of like amount executed by the railway company and by direction of Blackwell filled in plaintiff's name and the amount of the note, and, after Blackwell as president of the railway company had placed its name on the back of the note as an indorser, delivered it to plaintiff. Huttig testified that he was president of the lumber company, and auditor of the railway company; that there was a contract between the two companies; that the lumber company became indebted to the railway company, and quoting:
The appellee insists that on this evidence the verdict was rightly directed, for that: (1) The filling in of the blanks was unauthorized; (2) the execution of the note was ultra vires; (3) the indorsement of the railway company constituted a material alteration; and (4) notice of dishonor was not served on the railway company, and, as it was primarily liable, the omission released Huttig.
[2] I. As Blackwell was in possession of the note signed in blank, in the absence of any evidence to the contrary, he was authorized to fill the blanks, and, of course, he might do so through another. The same rule as to authority, however, applied to Reichert. Section 3060a14 of the Code Supplement declares that:
[3][4] Nor does Huttig deny that Blackwell was expected by him to make use of the blank notes by filling the blanks. His contention is that this was not done strictly in accordance with the authority conferred, as we understand him. He admits having given authority to use the notes (there were 13 of them signed in blank and so indorsed) to meet the debts of the lumber company. The evidence failed to show any existing debt of it to the railway company. But according to Blackwell the note was left with him “to assist in financing the company,” and this is not denied by Huttig. By “financing” is meant providing the means, generally, of carrying on its enterprises and meeting its obligations. A contract existed between the two companies under which the lumber company employed the railway company to carry its lumber and became indebted to it. The condition of the account between them was not shown, but it was such that Blackwell thought it would be all right to use this note to pay the debt of the railway company to the plaintiff and allow it a credit the amount thereof on the railway company's books, and thus offset what the lumber company then owed it or would become indebted. This might have been found by the jury to have been in the way of financing the lumber company and filling the blanks authorized for that purpose. The evidence as seen is not specific....
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