First National Bank of Sutton v. Sutton Mercantile Company

• Decision Date: 22 November 1906
• Docket Number: 14,511
• Citation: 110 N.W. 306,77 Neb. 596
• Parties: FIRST NATIONAL BANK OF SUTTON, APPELLEE, v. SUTTON MERCANTILE COMPANY, APPELLANT
• Court: Nebraska Supreme Court

110 N.W. 306

77 Neb. 596

FIRST NATIONAL BANK OF SUTTON, APPELLEE, v. SUTTON MERCANTILE COMPANY, APPELLANT

No. 14,511

Supreme Court of Nebraska

November 22, 1906

APPEAL from the district court for Clay county: ROBERT C. ORR JUDGE. Reversed.

REVERSED.

Paul E Boslaugh, John A. Moore and Hall, Woods & Pound, for appellant.

T. H Matters, contra.

ALBERT, C. DUFFIE and JACKSON, CC., concur.

OPINION

ALBERT, C.

The First National Bank of Sutton, Nebraska, brought an action in the district court against the Sutton Mercantile Company on a promissory note purporting to have been given by the defendant to a third party, and by such third party transferred by indorsement to the plaintiff. The note is negotiable in form and purports to have been signed on behalf of the defendant by Charles Coleson, its secretary. In addition to the usual allegations on a promissory note, the petition filed by the plaintiff contains the following: "The plaintiff further alleges that said Charles Coleson was duly authorized by direct agreement and consent of all the stockholders, directors and officers of said association to sign said note, and that said Coleson was authorized to, and did, sign all notes, checks and drafts for said company while he remained as stockholder and secretary of said company, and which is, by general consent of said organization, the duty of the secretary of the Sutton Mercantile Company to sign all notes, drafts and checks for said company. Plaintiff further alleges that after knowledge of all the facts, that is, after knowledge of the signing of said note by the said Charles Coleson, secretary of said company, said corporation kept, retained and used the property for which the note hereinbefore set out was given." After a general denial of each and every allegation contained in the petition not subsequently admitted, the answer, while admitting that Coleson was its secretary at the time the note was signed, alleges that he signed the same without authority and without consideration, and alleges certain facts amounting to a charge of fraud in the inception of the note. Other matters not necessary to notice at this time are alleged in the answer. The reply, for present purposes, may be said to amount to a general denial.

The following taken from the transcript of the corrected record of the district court shows the subsequent proceedings had in that court, so far as they are material at this time: "Now on this 10th day of May, 1905, the plaintiff appearing by its attorney, Thomas H. Matters, and the defendant not appearing in person or by attorney, this case coming on to be heard upon the petition of the plaintiff, the answer of the defendant, and the reply of the plaintiff, and the statement of plaintiff's counsel that the note sued on in this case is in the hands of the clerk, and that there is a certain amount due upon the same, and plaintiff asks for judgment for the plaintiff, and submits the cause to the court; upon consideration whereof the court finds that there is due plaintiff from the defendant, the Sutton Mercantile Company, upon their note herein sued upon the sum of four hundred and fifty dollars ($ 450). The court further finds that there is due interest on said note for four hundred and fifty dollars ($ 450) at the rate of 10 per cent. per annum from January, 1901, to May 10, 1905, making the sum of six hundred and forty-seven and no one-hundredths dollars ($ 647) owing by the defendant Sutton Mercantile Company to the plaintiff to this date." Then follows a formal judgment.

The defendant appeals, contending that error affirmatively appears on the face of the judgment record. This contention seems to be well founded. Where there is an answer on file setting up a valid defense, the fact that defendant fails to appear either in person or by attorney when a cause is reached for trial does not entitle the plaintiff to a judgment without proof of the facts constituting his cause of action, unless the facts admitted by the answer make out a prima facie case in his favor. The facts not thus admitted must be established by proof. In Pultz v Diossy, 53 How. Pr. (N.Y.) 270, where the defendant had answered, but failed to appear at the time set for trial, the court said: "The plaintiff, though the defendant failed to appear on the adjourned day, is bound to establish his cause...