Ellis v. Stone.

Decision Date01 May 1916
Docket NumberNo. 1825.,1825.
Citation21 N.M. 730,158 P. 480
PartiesELLIS ET AL.v.STONE.
CourtNew Mexico Supreme Court

OPINION TEXT STARTS HERE

Syllabus by the Court.

Where a writing in the nature of a contract is signed by a person, and contains apt words to bind him personally, the fact that to such signature is added such words as trustee,” “agent,” “president,” and the like, does not change the character of the person so signing, but are merely descriptive of him.

The rule of descriptio personæ is not applicable where the instrument on its face shows that the descriptive words were not used to describe the person, but to characterize the capacity in which he made the contract.

Where a simple contract is ambiguous as to the identity of the real parties thereto, the ambiguity will first be attempted to be solved from what appears upon the instrument itself, taking into consideration not only the words and figures in the body thereof, and the signatures and additions thereto, but any printed or written headings, memoranda in the margin, or other indicia which will serve to throw light on the intention of the parties.

Where upon the face of a simple contract doubt is rendered as to who is bound thereby, parol evidence may be employed to determine whose contract it is.

An agent, acting within the scope of the authority conferred upon him by the principal, is not to be held personally liable on the contract simply because the contract between the principal and the third party is invalid on account of lack of power in the principal to make such a contract where the extent of power possessed by the principal is a matter of public law.

The rule that the construction placed upon a contract by the parties thereto by their acts will be generally adopted by the court is not applicable to this case, because no harmonious construction thereof was adopted by the parties.

Where the trial court determined the issues of the case upon the pleadings and proof, it is no cause for complaint that the court followed the ruling of another judge on a demurrer filed therein.

Appeal from District Court, Roosevelt County; John T. McClure, Judge.

Action by John Ellis and another, administrators of the estate of George Ellis, deceased, against Lula Stone. From a judgment for defendant, plaintiffs appeal. Affirmed.

An agent, acting within the scope of the authority conferred upon him by the principal, is not to be held personally liable on the contract simply because the contract between the principal and the third party is invalid on account of lack of power in the principal to make such a contract where the extent of power possessed by the principal is a matter of public law.

G. L. Reese, of Portales, for appellants.

T. E. Mears, of Portales, Reid & Hervey, of Roswell, and Geo. S. Downer, of Albuquerque, for appellee.

HANNA, J.

This is an action brought by John Ellis and William I. Shriver, administrators of the estate of George Ellis, deceased, against Lula Stone, executrix of the estate of James P. Stone, deceased. The action is based upon a letter written by James P. Stone which plaintiffs, appellants here, assert constitutes a guaranty on the part of James P. Stone to discharge and satisfy an indebtedness owing the Ellis estate by W. W. Humble, represented by a promissory note executed by said Humble in favor of George Ellis, deceased.

The evidence in behalf of appellants is obscure in many respects. On account of certain contentions made by appellants it becomes necessary to review the evidence in greater detail than we would otherwise feel justified in doing. On the part of the appellants the evidence tended to show the following:

William I. Shriver and James P. Stone first met in the latter part of 1907 at El Dorado, Kan. Shriver made a loan to Stone personally, and at that time represented that he (Shriver) was then loaning money belonging to his brother-in-law, George Ellis. Subsequently Stone returned to New Mexico, and some time in 1908 wrote to Shriver requesting the latter to make three separate loans, one to A. S. Morrison, one to W. W. Humble, and one to another individual whose name could not be recalled, the first and second loans to be in the sum of $2,500 each, secured in one instance by bank stock, and in the other by stock of a corporation doing a mercantile business, and the third loan in the sum of $5,000 to be secured by a mortgage on certain hotel property. Shriver, not being acquainted with the persons for whom the loans were sought, nor with values in New Mexico, wrote to Stone and declined to make any of the three loans except the Morrison one, saying, however, in effect that, if Stone was of the opinion that the security for the Humble note was satisfactory, a loan would be made to Humble. On September 3, 1908, Stone, in response to the last-mentioned communication, wrote the following letter:

“8346

The Citizens' National Bank of Portales.

J. P. Stone, President.

B. Blakenship, Vice Pres.

S. A. Morrison, Cashier.

J. A. Fairley, Asst. Cashier.

Capital $50,000

Portales, New Mexico, September 3, 1908.

Mr. William Shriver, El Dorado, Kansas.--Dear Sir: I to-day send you two loans for $2,500 each as per our agreement. I also send receipt that you may sign for the protection of our customers in case of death. In regard to the hotel loan, I consider it a very liberal loan as the property is well worth $10,000 and party carries $6,000 insurance on same, but I think I can get the other $5,000 on different security. Of course, we will be responsible to you for any loan that I might send you. When I make the other loans I will forward same to you, and make draft through your bank for the amount. And if there is anything that is not satisfactory just let me know and I will make it right. I would be glad for you to make a trip down in this part of the country this fall, and see me, if you can let me know about what time you can come, so I will be sure to be here.

I make draft on you through your bank in order that we may run same in our books as remittances for collection. With kindest regards to yourself and Mr. Green, I am

Very truly yours, J. P. Stone, President.”

On the day this letter was received Shriver accepted a draft in favor of the Citizens' National Bank of Portales, and thereupon received the notes executed by A. S. Morrison and W. W. Humble, respectively, together with the collateral attached thereto. While the evidence on this point is vague and uncertain, it inferentially appears that the notes and collateral were transmitted either to the First National Bank of Kansas City, Mo., the drawee, or to the Farmers' & Merchants' National Bank of El Dorado, of which latter bank William I. Shriver was cashier, with instructions to deliver the same to Shriver upon the acceptance by him of draft in the sum of $5,000, payable to the Citizens' National Bank of Portales. The proceeds of that draft were subsequently transmitted to the last-named bank. It was shown that prior to the consummation of these loans Humble was largely indebted to the Citizens' National Bank of Portales, and was unable to discharge that indebtedness. Stone and Humble had a conversation in which Stone advised Humble that the bank was “hard up,” and needed the money which Humble owed it, and that he thought he could procure a loan for Humble, providing the latter furnished good and ample security therefor, saying that he (Stone) would have to stand for it,” meaning that Stone would have to be responsible for the loan. At that time Humble was not indebted to Stone, but owed the New Mexico bank, of which Stone was the managing head, a considerable amount of money.

Some time shortly prior to September 3, 1909, Humble wrote to Shriver advising him that he would be unable to pay the promissory note which he had previously executed in favor of Shriver or Ellis, and apparently asked for an extension of time. This letter was sent by Shriver to Stone, together with a renewal note, with instructions to effect a renewal of the first note upon the payment of the interest then due. This Stone did, accepting from Humble $250 as interest on said note, which money was transmitted to Shriver or Ellis either by the Citizens' National Bank of Portales or Stone. No further communication passed between Stone and Shriver until August 16, 1910, some 13 days before the renewal note became due, when Stone wrote Shriver advising that the Humble note be sent to him--

“so that we may proceed to collect same by law in the event he does not pay same when due, which I think he will not do now. I think we had better look after it promptly and make it out of his property if he does not pay and would prefer to lose no time on same.”

The Humble note and security were then sent to Stone, but apparently the note was not paid when due, and was subsequently placed in the hands of an attorney for collection and suit, which was authorized by Shriver. On October 11, 1910, Shriver wrote to Stone, saying in part:

“I hold a letter signed by you as president of the bank saying you would be responsible for the loans you make for us. And for that reason gave the matter no attention, as I looked for the pay to come through you.”

Subsequently suit was brought on the note, confession of judgment obtained from Humble and his wife, judgment entered thereon, and execution issued which was returned nulla bona.

Subsequent to this time a second suit was brought, in attachment, in Texas, against Humble, for the purpose of subjecting certain lands alleged to be owned by him to the payment of the judgment indebtedness. Shriver refused to authorize the execution of an attachment bond which in any manner would make him liable in damages, but apparently one was executed, at the solicitation of the attorney having the matter in charge, by some person other than Shriver. The costs of these suits were paid by the attorney. Shriver admitted at the trial of this case that all...

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