LONG
J.
This
action was brought in the Wayne circuit court upon the
following promissory note: "$2,000. Detroit, Aug. 21,
1889. Three months after date I promise to pay to the order
of Barnes Bros. two thousand dollars, at the
Citizens' Savings Bank, value received. [Signed] E. K.
ROBERTS. Indorsed: BARNES BROS." William H. Barnes and
Cyrus B. Barnes filed separate pleas, with affidavits
attached, denying the execution of the note, and averring
that, if the note was indorsed by Barnes Bros., it was
indorsed and delivered by one of said copartners without the
authority, expressed or implied, of these defendants, and
against the express agreement upon which the copartnership
was created, and without the knowledge or consent of said
defendants, and for purposes outside the partnership
business. It appears that after the note was indorsed by
Barnes Bros. it was presented to the Mechanics' Bank by
Roberts, the maker, and was discounted by that bank for
Roberts, on August 29, 1889, the avails being paid directly
to Roberts; the note having been indorsed by Barnes Bros.
purely for the accommodation of Roberts. The cause was tried
before a jury, who rendered a verdict in favor of the
plaintiff for the amount of the note and the interest, upon
which judgment was entered. Defendant William H. Barnes alone
brings the case to this court by writ of error. On the trial
it was practically conceded that Cyrus B. Barnes was liable
with Charles O., who indorsed the firm name on the note, as
Cyrus was shown to have full knowledge of the note, and its
indorsement, and had promised to pay it. It appears that
Barnes Bros. carried on a wholesale paper business in Detroit
for many years. They also had a paper-mill at Rochester, this
state. Cyrus B. and Charles O. conducted all the business in
Detroit, handled all the money, paid all the bills, borrowed
money when necessary, and apparently had full authority in
the conduct and charge of the Detroit business. William H.
Barnes looked after the mill at Rochester, and
occasionally went to Detroit to look after the business
there. Upon that subject William H. Barnes testified as
follows: "I live in Rochester, and have lived there for
about 20 years. I look after the mill; run the paper-mill.
The mill belongs to Barnes Bros. I have been running it. Some
portion of it has been running all the time. I take general
charge of the mill. The title to the mill has been in the
name of Barnes Bros. Cyrus B. resides in Detroit; Charles O.,
in Ypsilanti. Cyrus B. and Charles O. have been in Detroit
running the store. I sometimes came every two or three
months, and perhaps every week, and sometimes perhaps six
months. My part of the business has been principally in
looking after the mill. The books have been kept at the
store. I suppose you might say that Cyrus B. and Charles O.
have almost the entire charge of the financial part of the
business, as the books were kept there, and the money taken
in on collections and sales. I presume the firm has borrowed
herein. I do not know about it. Cyrus B. and Charles O. had
full authority to borrow money to run the business. I did not
know anything about it. They had authority for borrowing
money, if they did borrow it, so far as running the business
is concerned. I do not know of any notes they have made
within the last five years. I do not know of any instances
where they have indorsed the firm's name within the last
five years, except the cases that have been presented here. I
do not know of any other case of any character, where they
have indorsed the firm name either for my benefit or
otherwise. I did not keep the books, and had nothing to do
with them. I very seldom examined them. I have not examined
them within the last five years. I have taken and looked into
them sometimes to look up some particular account. But to
examine the books they have a regular book-keeper there. I
relied upon them in the conduct of the business to a certain
extent. I have the fullest confidence in Cyrus B. and Charles
O. I always thought they were straight in regard to that, to
carry out our agreement and arrangement. Cyrus never had
authority to do anything outside of the firm,
not from me. I never knew anything about
the firm raising any money by making paper and getting
indorsements from anybody else. I never knew of the firm
getting any money by their own indorsement of some other
person's paper. I have not examined the books at any time
to see if they were doing that or not, and within the last
five years I have only examined particular accounts. In 1875
I was told that they had indorsed some paper for somebody
else. I did not know the party that was indorsed for, or the
bank, and never heard of it afterwards, but was told what had
been done. I did not know whether it was ever put in
circulation, or whether it was ever released, but I was told
by outside parties. So I wrote them a letter, and asked them
about it afterwards. I did not look on the bills-payable
book, to see what it was. They claimed that they did not
indorse any at that time. I did not go around to the banks,
and attempt to find out what the paper was. I do not know
that there was any paper. I was simply told that by outside
parties. In 1889, I think the firm was banking at the Dime
Savings Bank. I can't tell where the firm was banking in
1888. It might have been at the Dime Savings Bank, or it
might have been at some of the others. I presume, if a note
had been protested upon which the firm were the indorsers,
taken in the usual course of business, and otherwise, and a
notice had been sent, it would come to the firm here in
Detroit, and, if it was delivered at the store, either Cyrus
B. or Charles O. would take care of it. I do not know that it
would be very likely to come to my attention. I suppose if a
protest was received on a note it would be likely to go to
the firm of Barnes Bros. at their place of business, and I
would not be very likely to see it. In 1889, I presume there
were four or five months, and perhaps six months, I was not
in. I was sick at that time. I have been out of health a good
deal. I did not come to Detroit in from one to six months.
During that time I attended to the business out
there,-manufacturing of paper. I do most of the business of
buying of stock for the mill. I pay no attention to the paper
stock, and the collection of accounts. I paid no attention to
the banking of paper in the course of trade, and the taking
care of the paper when it became due.
Redirect: I had confidence in my brothers to attend to the
firm business in Detroit. I did not mean to say that I
understood they had any authority, or that I intended to give
them any authority, to do anything outside of the firm
business. Question. I call your attention to letter under
date of January 19, 1875." The letter is produced and
shown to the witness, and the witness says that said letter
was transmitted to his brothers. Said letter was thereupon
offered and admitted in evidence, and marked "Exhibit
D," and is as follows: "Rochester, January 19,
1875. Messrs. Barnes Bros.-Gents: When I was out to Ypsilanti
last week I was told by Lambert that you were exchanging
checks and notes with parties in the city. If that is the
case, it has got to be stopped at once. I suppose you know
what our agreement is, and, if you will do it, I shall
withdraw from the firm, for I will not allow anything of the
kind. Not but what the parties may be all right, but it is no
way to do business, and it must be stopped. Yours, W. H.
BARNES."
It is
claimed by counsel for the plaintiff that it is thus made
apparent that W. H. Barnes gave up the financial end of the
business to his brothers, and, if the necessities required
it, Cyrus B. and Charles O. had full power to do whatever
they chose towards raising money. It is also contended that
Barnes Bros. were under obligations to Roberts to indorse his
paper, for the reason that Roberts had been accustomed to
indorse for Barnes Bros.; that is, that the parties had been
exchanging credit by indorsing for each other. Roberts was
president of the Citizens' Savings Bank. He testifies
that Cyrus B. Barnes made a note of $1,000 to his order.
Charles O. was present, and they asked him to indorse it and
get the money on it, which he did, of Mr
Butler, at the Mechanics' Bank of Detroit. The Barnes
firm took their business thereafter to the Dime Savings Bank.
In 1888 they made another note of $10,000, which Roberts
indorsed, and the money was got by the Barnes Bros. In 1889
two $500 notes were made by Barnes Bros., indorsed by
Roberts, and taken by him to the Mechanics' Bank, and
discounted, and the money paid over to Barnes Bros. These
indorsements were made at the request of Cyrus B., but it
appears with the full knowledge of Charles O., and there is
no question but that the moneys were all used in the
partnership business. The note in suit was made on August 21,
1889, by Roberts, and indorsed by Barnes Bros., and presented
by Roberts to plaintiff, the Mechanics' Bank of Detroit,
for discount on August 29th. At the time the note in suit was
presented for discount, the two $500 notes indorsed by
Roberts were then held by plaintiff, not having yet matured.
They were subsequently paid by Barnes Bros. ...
