Lafayette Sav. Bank v. St. Louis Stoneware Co.
| Decision Date | 06 June 1876 |
| Parties | LAFAYETTE SAVINGS BANK, Respondent, v. ST. LOUIS STONEWARE COMPANY, Appellant. |
| Court | Missouri Court of Appeals |
1. The general powers of a manufacturing corporation give it no authority to indorse accommodation paper; but the fact that such a company appears as indorser of paper of which it is not payee does not tend to show that such an indorsement is for the accommodation of others, nor is it a circumstance to put those purchasing such paper on inquiry.
2. The burden to show that such paper was taken with notice that the company had no authority to indorse the same lies on the defendants, in a suit on the note.
APPEAL from St. Louis Circuit Court.
Reversed and remanded.
George Denison, for appellant, cited: McCullough v. Moss, 5 Denio, 566, 567; First Nat. Bank v. Hogan, 47 Mo. 472; Dabney v. Stevens, 46 How. Pr. 340, 341; Brown v. Donnell, 49 Mo. 421; Morford v. Farmers' Bank, 26 Barb. 568; Hall v. Auburn Turnpike Co., 27 Cal. 257; Bank of Genesee v. Patchin Bank, 13 N. Y. 309; Hamilton v. Marks, 52 Mo. 78; Farmers & Mechanics' Bank v. Empire Stone Dressing Co., 5 Bosw. 289; Central Bank v. Empire Stone Dressing Co., 26 Barb. 23; Noble v. Walker, 32 Ala. 456; Mauldin v. Branch Bank, etc., 2 Ala. 502; Central Bank of Brooklyn v. Barnabas Hammett et al., 50 N. Y. 158; Overton v. Hardin, 6 Coldw. 377; Stall v. Catskill Bank, 18 Wend. 478; Hendril v. Berkowitz, 37 Cal. 119; Richards v. Darst, 51 Ill. 140; Thomas v. Alton, 5 Mo. 534.
Ford Smith, for respondent, cited: Moss v. Averall, 10 N. Y. 449-453; McIntire v. Preston, 10 Ill. 48.
This is a suit on a negotiable promissory note for $700, dated St. Louis, November 13, 1873, made by Merrick & Stickney, payable at plaintiff's bank, sixty days after date, to the order of Richmond, Bowman & Co., with interest at 10 per cent, after maturity. The note is indorsed “Richmond, Bowman & Co.;” “St. Louis Stoneware Company, E. T. Merrick, Treasurer.”
The petition alleges the making of the note by Merrick & Stickney, copartners, and its delivery to the payees, who for value indorsed it in writing and delivered it to defendant, which, by its proper officer, indorsed in writing and delivered the same to the plaintiff for value; due demand, non-payment, protest, and notice are alleged, and that plaintiff holds the note for value, and that it is unpaid. The petition has the usual prayer for judgment.
Defendant, by its answer, verified by affidavit of its secretary, denies knowledge of the execution of the note, and that the payees delivered it to defendant; denies indorsement and delivery by defendant to plaintiff; says that defendant received no consideration for the note, and that plaintiff knew all these facts; denies knowledge of demand, protest, and notice; denies that it had knowledge of such facts, and puts the ownership of the note at issue. The answer charges that the note was made by Merrick & Stickney, and indorsed by Richmond, Bowman & Co. for the sole accommodation of Merrick & Stickney, in a matter outside the business of defendant's corporation; that Merrick & Stickney got it discounted for their own account by plaintiff, and that defendant had no interest in the note or its proceeds; says that plaintiff had notice of all these facts.
The reply denies the new matter in the answer.
On trial the suit was dismissed as to Richmond, Bowman & Co.
The plaintiff proved that defendant was incorporated on December 20, 1865, to carry on the stoneware and pottery business in St. Louis county, with a capital stock of $100,000; which stock, at the time the note sued on was made, was owned, as to nine-tenths, by Merrick & Stickney, and as to one-tenth by Lucien R. Blackmer, the secretary of the defendant; that Merrick was treasurer, and Stickney president of defendant, and that they acted as such at the time of the execution of the note, and many years prior thereto; that Merrick was generally known as financial manager of defendant, and that...
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