Matthews v. Dubuque Mattress Co.

• Decision Date: 24 January 1893
• Citation: 54 N.W. 225,87 Iowa 246
• Parties: MATTHEWS ET AL. v. DUBUQUE MATTRESS CO. ET AL.
• Court: Iowa Supreme Court

87 Iowa 246

54 N.W. 225

MATTHEWS ET AL.

v.DUBUQUE MATTRESS CO. ET AL.

Supreme Court of Iowa.

Jan. 24, 1893.

Appeal from district court, Dubuque county.

Action on a promissory note. Judgment for the plaintiff, and defendant Kapp appeals.O'Donnell Bros., for appellant.

Longueville & McCarthy, for appellee.

ROTHROCK, J.

The note upon which the action was brought was in these words: “$290.87. Chicago, Ill., March 15th, 1889. Ninety days after date, we promise to pay to the order of J. T. Matthews & Co. two hundred and ninety and eighty-seven one hundred dollars. Payable at the office of the Dubuque Mattress Co., Dubuque, Iowa. Value received. Accepted March 21st, 1889. Dubuque Mattress Co. John Kapp, Pt.” Defendant Kapp alone answered,--that at the date and acceptance of the note he was the president of the corporation the Dubuque Mattress Company, and had full authority to sign notes and acceptances for said corporation in its business; that the consideration for the note sued on was goods purchased from the plaintiff firm for the mattress company, and that the mattress company received the whole of the consideration for the note, which fact was known to the plaintiff; that the plaintiff knew when taking the note that it was signed by appellant only to evidence the signature and bind the corporation, and that the appellant so intended. A demurrer to the answer was sustained, from which ruling this appeal is taken.

The only question in the case is as to the admissibility of parol evidence to establish the facts set forth in the answer. This court has held in a large number of cases that where the person signing a note adds thereto his name of office, either in full or by abbreviation, and there is nothing on the face of the instrument showing that he does not intend to be bound thereby, he is personally liable for the performance of the contract, because the name of office is merely descriptive of the person. We need not cite the cases. They will be found in McClain's Digest (volume 1) under the title of “Agency.” The latest expression of this court upon that subject will be found in the recent case of Lee v. Percival, 52 N. W. Rep. 543. And this rule has the sanction of a large preponderance of adjudged cases. In Parsons on Contracts (volume 1, p. 57) it is said in reference to that question that “the case sometimes occurs where a person holding some office signs his name, adding to it the name of his office, for the purpose of representing himself as an official agent, and preventing his personal liability; but this mere addition seldom has this effect, being usually regarded only as a word of description.” This rule is based upon the principle that the legal effect of the language used in the note or contract imports an obligation personally binding upon the signer of the instrument. And in the cases of Heffner v. Brownell, 75 Iowa, 341, 39 N. W. Rep. 640, and McCandless v. Canning Co., 78 Iowa, 161, 42 N. W. Rep. 635, we held that parol evidence was not admissible to show that a party signing a note in that way did not intend to be personally liable thereon. These cases are decisive of the question presented in the case at bar, and must lead to an affirmance, unless we overrule decided cases. A majority of the court are not able to discover any good reason for so doing. An examination of adjudged cases will show, as claimed by counsel for appellant, that there is authority for holding that extrinsic evidence is admissible to explain the writing. On the other hand, there are many cases which hold that parol evidence is not admissible. An able text writer uses the following language in reference to this question: “To extract general principles from these cases whose conflict is so great as to amount, in the language of a recent case, ‘almost to anarchy,’ is manifestly difficult.” We do not deem it necessary to cite the cases which are in accord with the former rulings of this court. When it is conceded that the instrument construed alone is binding on the party, it appears to us that there is no law pertaining to ambiguous writings which will authorize a relaxation of the rule that a written contract cannot be added to, altered, or changed by parol evidence; and the rule as recently announced by this court in Lee v. Percival, supra, renders it wholly unnecessary, to the protection of any right of the signer of such an instrument, to overrule any case heretofore decided by this court. The note involved in Percival's Case is substantially the same as the note in the case at bar; and it is held that the party whose name was signed might by an appropriate pleading set up that the note was so signed by mutual mistake of the party, and demand a reformation of the instrument, and prove the mistake by parol. It should be the aim of every court of last resort to build up a harmonious and consistent line of authority, and thus avoid confusion; and cases should be overruled only when there appears to be a necessity therefor, in order to protect the rights of the people, or to promote the proper administration of justice. When a party to such an instrument is by an authoritative decision of this court given the opportunity to reform the instrument by parol evidence, he should not be heard when he asserts the claim that former decisions of the court should be overruled, because there are cases in conflict with them, and because he cannot be allowed to introduce parol evidence in an action at law, and under a merely defensive answer.

It is claimed that because this note is made payable at the office of the Dubuque Mattress Company, and that the note contains the words, “Accepted, March 21st, 1889,” it renders the instrument ambiguous, so as to change the rule as to extrinsic evidence. We discover nothing in fixing the place of payment, or the use of the words of acceptance, to create any ambiguity which would affect the question as to the introduction of extrinsic evidence to contradict the legal effect of the instrument. The judgment of the district court is affirmed.

KINNE, J., (dissenting).

Under the doctrine announced in the majority opinion in this case, and in other cases on which it is based, it is held that parol evidence of intention of the parties is inadmissible. I am unable to concur in that conclusion. It would be useless to attempt to consider, much less reconcile, all the cases bearing on the question. I shall endeavor to state the law which I believe applicable in this case, and make a brief review of a few of the authorities which support my contention.

If in such a case there is anything on the face of the paper, whether in the body of the note or as a part of the signature, which suggests a doubt as to the party bound, or the character in which any of the signers has acted in affixing his name, parol evidence is admissible between the original parties to establish the real intent; hence while, where one signs as agent of another, the prima facie presumption is that the words are merely descriptio personae, and therefore the one so signing is personally bound, yet it may be shown, in an action between the original parties to the instrument, that it was not so intended, and that, in fact, the real intention was to bind the principal whose name was disclosed in the signature of his agent, or who was well known by the payee to be the real party to be bound. Hardy v. Pilcher, 57 Miss. 18;Haile v. Peirce, 32 Md. 327;McClellan v. Reynolds, 49 Mo. 312;Baldwin v. Bank, 1 Wall. 234;Carpenter v. Farnsworth, 106 Mass. 561;Mechanics' Bank v. Bank of Columbia, 5 Wheat. 326;Means v. Swormstedt, 32 Ind. 87. Sometimes the doctrine is stated that, where words which may be either descriptive of the person, or indicative of the character in which he contracts, are affixed to the name of the contracting party, prima facie they are descriptive of the person only; but the fact that they were not so intended by the parties, but were understood as determining the character in which the party contracted, may, as between the original parties, be shown by extrinsic evidence. Pratt v. Beaupre, 13 Minn. 177, (Gil. 187;)Bingham v. Stewart, 14 Minn. 214, (Gil. 153;)Deering v. Thom, 29 Minn. 120, 12 N. W. Rep. 350;Rowell v. Oleson, 32 Minn. 288, 20 N. W. Rep. 227. A learned author thus states the rule, as being supported by the preponderance of authority: “Between the immediate parties to a bill or note, parol evidence is admissible to show that, by a course of dealing between the parties, that form of execution has become to be the recognized and adopted form by which the obligation of the principal is entered into;” also that it is admissible to show “that the instrument was, to the knowledge of the parties, intended to be the obligation of the principal, and not of the agent, and that it was given and accepted as such.” Mechem, Ag. § 443; Metcalf v. Williams, 104 U. S. 93;Hovey v. Magill, 2 Conn. 680;La Salle Nat. Bank v. Tolu Rock & Rye Co., 14...