Hager v. Rice

• Decision Date: 01 April 1878
• Citation: 4 Colo. 90
• Parties: HAGER v. RICE.
• Court: Colorado Supreme Court

4 Colo. 90

HAGER v. RICE.

Supreme Court of Colorado

April, 1878

Error to County Court of Arapahoe County.

Messrs CHARLES & DILLON, for plaintiff in error.

Mr JOHN W. HORNER and Mr. D. J. HAYNES, for defendant in error.

THATCHER C. J.

This was an action in assumpsit, brought by Stephen A. Rice against Frederick D. Hager, upon two certain bills of exchange, in the following form '$309.

DENVER COL., 22d June, 1874.

Ninety days after date, pay to the order of S. A. Rice, three hundred and nine dollars, value received, and charge the same to account of

Boulevard and Sloan Lake Steam Navigation Company.

By WM. ANDERSON, Pres't.

To F. D. HAGER, Treas.

Denver, Colorado.'

'$309.

DENVER, COL., 22d June, 1874.

Sixty days after date, pay to the order of S. A. Rice, three hundred and nine dollars, value received, and charge the same to account of

Boulevard and Sloan Lake Steam Navigation Company.

By WM. ANDERSON, Pres't.

To F. D. HAGER, Treas.

Denver, Colorado.'

Written across the face of each bill are the words, 'Accepted, F. D. Hager, Treas.'

Upon these bills of exchange, the plaintiff sought to charge the defendant individually; and, in the court below, recovered judgment for the amount due thereon. In his third plea, the defendant substantially alleges, that he was the treasurer of the company; that he was authorized, and it was his duty as such treasurer, to pay out all moneys in his hands, belonging to said company, on its order, and to accept, as its treasurer, by the name and style of F. D. Hager, Treas., all orders or bills of exchange, drawn by said company on its treasurer, and to pay the same when due, if he had sufficinet funds of the company in his hands, of all which the plaintiff had notice; that said bills of exchange were given for an indebtedness, due from the company to the plaintiff; that he, to the knowledge of the plaintiff, accepted the same as treasurer of the company, and not otherwise; that when the bills became due, there was no money of the company in his hands. To this plea the court sustained a general demurrer. The allowing of the demurrer is the chief error relied upon for the reversal of the judgment.

If a bill of exchance is complete in itself, free from any latent ambiguity, obviously carrying its passport upon its face, there is no need of oral testimony to aid in its exposition. The clear and intelligible terms of such an instrument may not be explained by extrinsic evidence. This is a familiar rule, of constant application in the interpretation of written contracts. Can it be said that the drafts in question belong to this class? That upon their face, it is proclaimed to the world, that Hager was acting in his individual capacity, in accepting them? Or rather, would not the more natural construction be, that these drafts were drawn by the principal, the company (whose name appears on the face of the instrument), by its president, upon its treasurer as such? Giving to each word its appropriate meaning, considering each instrument in every part and as a whole, and having reference to well-established commercial usage, as to the mode of drawing bills of exchange by a corporation upon itself, we do not hesitate in our conclusion, that the drafts in controversy must have been understood, especially if the averments in the third plea are true, as having been accepted by the treasurer as such, and not as an individual. But, keeping in view the assignment of errors, it is unnecessary to decide, whether, upon the face of the drafts, the acceptance by Hager is prima facie only an acceptance by him in his official capacity.

The defendant assumed by his third plea the burden of proving and at the trial offered to introduce evidence to establish the character of the acceptance, and that the plaintiff, at the time the acceptance was indorsed, had knowledge of the facts set up in the plea, and regarded the drafts as solely the obligations of the company. The case of Babcock et al. v. Beman, 11 N.Y. 200, is in point. In that case, Babcock and others brought an action against Beman, as indorser of a promissory note, executed by Adam Smith & Co., and made payable to the order of Beman. The note was in the...