Merch.S' & Farmers' Bank v. Johnston

• Decision Date: 15 May 1908
• Court: Georgia Supreme Court
• Parties: MERCHANTS' & FARMERS' BANK. v. JOHNSTON.

130 Ga. 661

61 S.E. 543

MERCHANTS' & FARMERS' BANK.

v.JOHNSTON.

Supreme Court of Georgia.

May 15, 1908.

1. Partnership—Acts of Partner—Negotiable Instruments.

An act done by an agent at the instance of and in the presence of his principal is in law the act of the principal; and if, at the instance and in the presence of a member of a partnership, the name of the partnership is signed by another person to a promissory note under seal, the note thus executed has the same legal effect as if such member had performed the physical act of signing.

[Ed. Note.—For cases in point, see Cent. Dig. vol. 38, Partnership, §§ 242-255; vol. 40, Principal and Agent, §§ 245, 431.]

2. Same.

Under Civ. Code 1895, §§ 2643, 2651, one member of a commercial partnership can bind it by signing its name to a promissory note under seal, in the course of the business of the partnership.

[Ed. Note.—For cases in point, see Cent. Dig. vol. 38, Partnership, §§ 242-255.]

(Syllabus by the Court.)

Error from Superior Court, Baldwin County; H. G. Lewis, Judge.

Action by the Merchants' & Farmers' Bank against Kate M. Johnston. Judgment for defendant, and plaintiff brings error. Reversed.

The suit was against Samuel Evans & Co. (alleged to be a partnership composed of Samuel Evans and Kate M. Johnston) on two promissory notes under seal, payable to the plaintiff, one dated September 28, 1900, and the other dated January 8, 1901, and upon an account. The notes were signed "Samuel Evans & Company, per M. Johnston." The defendant Kate M. Johnston filed a plea denying that she was ever a member of thepartnership, or that she was indebted to the plaintiff, and denying that she ever executed, or authorized any one else to execute for her, the notes sued on, or ever ratified their execution. The evidence of the plaintiff material to be considered was as follows: The business of the firm of Samuel Evans & Co. was trading in stock, and the firm ran an account with the plaintiff. The notes sued upon were given to the plaintiff to cover an overdraft of this account. Samuel Evans authorized the cashier of the plaintiff to open the account. M. Johnston, the husband of Kate M. Johnston, had the management of the trading. Upon the hearing of a claim case, which the witnesses thought was in 1899, Kate M. Johnston testified that a horse, title to which was involved in the claim case, was the property of Samuel Evans & Co., and that she was the company in this firm, which was a copartnership composed of Samuel Evans and herself, and that M. Johnston worked for the firm. A part of the testimony of the cashier of the plaintiff was as follows: "Mr. Samuel Evans, after the signing of the notes sued on, by Dr. Johnston as agent, ratified everything that was done in regard to the business of Samuel Evans & Co. He approved the signing of the notes sued on, which are signed 'Samuel Evans & Company, per Mark Johnston.' A heap of times they would be signed in his presence. Samuel Evans approved all of these transactions, including the notes. He always approved all of them when I was cashier. I never would take one of these notes without his approval. They would come in the bank and fix them up and cover the overdrafts, both being present. I would get after them about the overdrafts, and they would come in and make notes to cover the overdrafts, and I would never take the notes without Samuel Evans' approval. I do not swear positively what Mr. Evans said about these two particular notes, but these notes were taken by Mr. Evans' approval. I don't know that I could state what Mr. Evans said about them. He didn't say anything about their being under seal." John T. Allen, president of the plaintiff, also testified: "I wish to say that Mr. Evans said to me repeatedly that he approved this transaction, and that he authorized Mark Johnston to sign 'Samuel Evans & Company' to these particular notes, and approved the transaction." Checks on and receipts to the plaintiff were introduced in evidence, signed "M. Johnston, Agent, " and checks, dated in 1899, were introduced in evidence, signed, "Samuel Evans & Company, per Mrs. M. Johnston." When the notes sued upon were tendered in evidence by the plaintiff, the court ruled they were not admissible in evidence against Kate M. Johnston, for the reason that it appeared that they were executed under seal by an agent, and there was no proof of ratification under seal of the execution of such instruments, and, upon motion of defendant's counsel, the court granted a nonsuit in so far as the defendant Kate M. Johnston was concerned, counsel for the plaintiff in error conceding that there could be no recovery upon the account sued upon. To these rulings the plaintiff excepted.

Allen & Pottle, for plaintiff in error.

Kines & Vinson, W. B. Wingfield, and J. S. Turner, for defendant in error.

HOLDEN, J. (after stating the facts as above). 1. An agent acting in behalf of a principal, in the latter's presence and at his instance, is for the time being the alter ego of the principal, and the agent's act is in law the act of the principal himself. So, if one person, at the request and in the presence of another, execute an instrument in behalf of the latter, the legal effect is the same as though the party authorizing the execution himself held the pen. Ellis v. Francis, 9 Ga. 325; Reinhart v. Miller, 22 Ga. 402, 68 Am. Dec. 506. See, also, Cunningham v. Lamar, 51 Ga. 574. This rule is not altered by the fact that the instrument executed is one under seal. 2 Bishop on Contracts, § 1047. Applying the above rule to the case under consideration, if M. Johnston, at the instance and in the presence of Samuel Evans, signed to the notes sued upon the name of the firm of which Samuel Evans was a member, these notes have the same legal effect as obligations of such partnership as though Samuel Evans himself had affixed the partnership name thereto. Who composed the firm of Samuel Evans & Co., and whether the signature of the partnership to the notes was made under such circumstances as to make it in law the act of Samuel Evans, are, under the evidence in the case, questions of fact for determination by a jury.

2. The court excluded the notes from evidence when offered by the plaintiff, because they were under seal. There was no evidence that Kate M. Johnston ratified the signing of the notes, or authorized the signing of them, unless the authority came from her relation to the partnership. The main question involved in this case is whether or not one partner can bind the partnership by executing a note under...