First Nat. Bank Of Pennsboro v. Delancey, (No. 6532)

• Decision Date: 06 May 1930
• Docket Number: (No. 6532)
• Citation: 109 W.Va. 136
• Court: West Virginia Supreme Court
• Parties: First Nat. Bank of Pennsboro v. Delancey et al.(Rehearing DeniedJuly 17, 1930.)

109 W.Va. 136

First Nat. Bank of Pennsboro

v. Delancey et al.(Rehearing Denied July 17, 1930.)

(No. 6532)

Supreme Court of Appeals of West Virginia.

Submitted April 29, 1930.

Decided May 6, 1930.

1. A church required money to complete its building. The Trustees "talked it over" and then executed a note to secure the money, in which the makers were described as "we, the trustees of the Ellenboro m. E. church." Held, Under Code, c. 98A (Negotiable Instrument Law) § 20, and Code, c 57, § 8, the trustees are not personally liable.'

Error to'Circuit Court, Ritchie County.

Action by the First National Bank of Pennsboro against C. W. Delancey, J. W. McGinnis, and others. To review an adverse judgment, defendant last named brings error.

Reversed; dismissed as to plaintiff in error.

Thomas' J. Davis, for plaintiff in error. S. A. Powell, for defendant in error.

Hatcher, Judge:

The plaintiff in error, J. W. McGinnis, is a trustee of a church. He signed a note executed on behalf of the church. The circuit court found that he was bound thereon personally. The note in question is as follows:

"Pennsboro, W. Va., July 19th, 1924. '' On demand, we, the trustees of the Ellenboro M. E. church, promise to pay to the order of the First National Bank without offset and for value received One Thousand Dollars negotiable and payable at the First National Bank of Pennsboro, W. Va., with interest from date.

"C. W. Delancey,

"S. D. Riley, "Lulu M. Dwyer, "Mary L. Riley, "J. W. McGinnis, "C. B. Morris, "E. H. Delancey."

The church building was under construction and the money borrowed on the note was needed for its completion. The bank was fully apprised of the situation. According to the court records, S. D. Riley, J. W. McGinnis, and E. H. Delancey were trustees. There was oral testimony not objected to or contradicted (see record, pages 26 and 31) to the effect that C. W. Delancey and C. B. Morris were also trustees, and with the other three constituted the entire board. Lula M. Dwyer and Mary L.' Riley were members of the church building committee.

Section 20 of the Negotiable Instrument Law (Code, c. 98A), provides: "Where the instrument contains * * * words indicating that he [a maker] signs * * * in a representative capacity, he is not liable on the instrument if he was duly authorized. McGinnis and his associates described themselves in the body of the note as "we, the trustees of the Ellenboro M. E. church." The word "trustees" signifies representation. It points ex vi termini to a real party in interest here disclosed. Johnson v. Smith, 21 Conn. 627, 632, 633. No reason appears for using the descriptive phrase except to show the representative capacity of the makers. Men do not make an idle reference in a personal contract to their official connection with some third party in no way related to the transaction. Bank v. Steel Co., 155 Ind. 581, 585, 58 N. E. 833, 52 L. R. A. 307. The promise to pay in the body of the instrument is the promise of the trustees, as such. We should not "be astute to misapprehend" such plain language. Annotation, 48 Am. St. Rep. 919.-

As a general rule, a trustee has no implied power to bind the trust estate for money borrowed, and, even if he promise as trustee, he is bound personally. "The trust estate cannot promise." Taylor v. Davis, 110 U. S. 330, 335, 4 S. Ct. 147, 150, 28 L. Ed. 163; Dantzler v. Mclnnis, 151 Ala. 293, 44 So. 193, 13 L. R. A. (N. S.) 297, 125 Am. St. Rep. 28; 28 A. & E. Ency. Law 983; 39 Cyc. 331. But Code, c. 57, § 8, gives to the board of trustees for a church express authority to borrow money "if required for building * * * purpose," and to "execute a lien upon any property, real or personal, held by them as such trustees to secure the...