Draper v. Rice

• Decision Date: 14 December 1880
• Citation: 7 N.W. 524,56 Iowa 114
• Parties: DRAPER v. RICE.
• Court: Iowa Supreme Court

56 Iowa 114

7 N.W. 524

DRAPER

v.RICE.

Supreme Court of Iowa.

Filed December 14, 1880.

Appeal from Linn circuit court.

Action upon a promissory note for $23. Defendant pleaded payment. Judgment for plaintiff. Defendant appeals.J. T. Rice and Geo. W. Wilson, for appellant.

Mills & Keeler, for appellee.

ADAMS, C. J.

The note was made payable to the plaintiff or bearer. It was given in part payment for a melodeon, which was sold to the defendant as the property of the plaintiff. The trade was negotiated by one Jacobs, who took the note and delivered it to the plaintiff. Afterwards the defendant paid the amount of the note to Jacobs, but he did not get the note, because it was in the possession of the plaintiff. The payment was made upon the strength of Jacobs' statement that he was the agent of the plaintiff, and was authorized to collect the note, and would obtain it of plaintiff and deliver it to the defendant. Jacobs was not in fact the plaintiff's agent at the time of the payment, and plaintiff never received the money paid. The defendant, however, contends that, while this may be so, he was justified in assuming that Jacobs was the plaintiff's agent, because the plaintiff, in receiving the note, had recognized him as such.

The precise question certified for our decision is in these words: “When the plaintiff, as payee, seeks to recover on the note, can the defendant, Rice, maintain his defence of payment made to the assumed agent, Jacobs, in pursuance of the agreement made by said agent to obtain the note, although the said agent was acting without authority, as shown in this case?”

As showing that such defence can be maintained, the defendant relies upon Eader, Guilford & Co. v. Ashbough, 44 Iowa, 519. But that case is not in point. It would, at most, only have the effect to show that the plaintiff, in accepting the note, made Jacobs his agent in the transaction out of which the note grew. But that agency would not, we think, extend to the matter of payment. Authority to sell a piece of property, as agent, and take a note for it in the name of the principal, would not of itself include the authority to receive payment. Had the note sued on been entrusted to Jacob by plaintiff, although for some purpose other than collection, the case might be different.

It must be seen at once that the rule contended for would be a pernicious one. No person could, with safety, employ an agent to take a promissory note, if payment made to the agent...