Peoples Banking Co. v. Brumfield Hay & Grain Co., s. 37030

• Decision Date: 27 December 1961
• Docket Number: Nos. 37030,37032 and 37033,37031,s. 37030
• Parties: , 92 A.L.R.2d 946, 18 O.O.2d 88 The PEOPLES BANKING CO., Appellee, v. BRUMFIELD HAY & GRAIN CO., Appellant. (Four cases.)
• Court: Ohio Supreme Court

Page 545

172 Ohio St. 545

179 N.E.2d 53, 92 A.L.R.2d 946, 18 O.O.2d 88

The PEOPLES BANKING CO., Appellee, v. BRUMFIELD HAY & GRAIN CO., Appellant. (Four cases.)

Nos. 37030, 37031, 37032 and 37033.

Supreme Court of Ohio.

Dec. 27, 1961.

Syllabus by the Court

1. The authority of one to execute a warrant of attorney to confess judgment against another should not be recognized unless expressly conferred.

2. Where a judgment in personam has been rendered against a defendant who was not served with summons, who did not enter an appearance and who did not authorize anyone to enter an appearance for him, such judgment is void and may be attacked by motion after term without following the procedure specified in the Ohio statutes for the vacation of judgments after term.

Appeals from the Court of Appeals of Hancock County.

Thomas A. Orndorff, Findlay, for appellee.

John C. Firmin, Findlay, and Turley, Tackett & Geralds, Lexington, Ky., for appellant.

On February 15, 1960, palintiff in cause No. 37030 secured a judgment in the Common Pleas Court of Hancock County against Brumfield Hay & Grain Company, a partnership.

The judgment was rendered by confession by an attorney purporting to act for defendant pursuant to a warrant of attorney incorporated in a promissory note which was signed:

'Brumfield Hay & Grain Co.

'By A. D. Daniel.'

Thereafter, at a subsequent term of court, defendant filed a motion reading in part:

'Without entering its general appearance herein, but for the sole and special purpose of making objection to the improper and unlawful assumption of jurisdiction over its person * * * comes now the defendant and moves the court to set aside and vacate the judgment * * * upon the ground that this court has never lawfully had jurisdiction over the person of this defendant * * * for the following reasons: * * *.'

The motion then specifies in effect (1) that the record shows no service of process on defendant, (2) that the attorney who confessed judgment is unknown to defendant and appeared without authority from defendant and (3) that the warrant of attorney pursuant to which that attorney purported to act was not signed on behalf of defendant by anyone having either express or implied authority to sign such a warrant.

From the court's journal, it appears that this motion was heard 'upon an affidavit and exhibits attached, submitted to the court and received as evidence and upon arguments of counsel' and was overruled.

From the bill of exceptions, which was certified by the trial judge as containing 'all of the evidence introduced and received on the hearing on said motion to vacate,' it affirmatively appears that the trial court overruled the motion because the defendant had not proceeded under Section 2325.01, Revised Code, relative to vacation of a judgment after term and because, even if its motion should be treated as a petition pursuant to that statute, defendant had failed to offer to establish any defense.

The Court of Appeals affirmed the overruling of defendant's motion, upon the ground that reasonable men could conclude from the evidence presented to the trial court that the agent who signed the note for defendant had authority to sign a note incorporating the warrant of attorney pursuant to which the judgment was rendered.

The cause is now before this court on appeal from the judgment of the Court of Appeals as a matter of right and pursuant to allowance of defendant's motion to certify the record.

TAFT, Judge.

The affidavit submitted in support of defendant's motion expressly negatived any authority of its 'commission agent,' A. D. Daniel, to sign a warrant of attorney to confess a judgment. Attached thereto as an exhibit is a copy of a letter giving Daniel 'authority to act as * * * commission agent to sign * * * agreements prepared by' plaintiff. Also attached to that affidavit as an exhibit is a copy of a prior agreement between plaintiff and defendnat, which is apparently referred to in that letter, providing that plaintiff had agreed 'to finance portions of hay and straw purchase from farmers * * * by' defendant; that defendant agreed 'to give chattel mortgage on all stored hay or straw * * * as security to loans'; and that plaintiff was 'to be paid six per cent interest from date of loan until paid, plus $1.50 for collection of each * * * sight draft' plus certain other specified charges for 'work involved in handling financing, plus any other cost involved.'

Nothing in this agreement or letter purports to expressly authorize Daniel to sign evidences of indebtedness, such as promissory notes, for defendant. Even if such authority could be implied from the words of the letter and of the agreement, there is nothing in either to support any reasonable inference that Daniel either had or was represented to have authority to sign any warrant of attorney to confess judgment against defendant.

Although an agent with authority to borrow money may have authority to do what is reasonably necessary to obtain that money, including authority to give negotiable instruments in ths usual form where required, such authority alone will not support a reasonable inference of authority to give any warrant of attorney to confess judgment. Restatement of the Law of Agency (2d), Section 75, Comment b.

This court has often held that a warrant of attorney to confess judgment must be strictly construed. Lathrem v. Foreman (1958), 168 Ohio St. 186, 151 N.E.2d 905, 68 A.L.R.2d 1151; Haggard v. Shick (1949), 151 Ohio St. 535, 86 N.E.2d 785; Cushman v. Welsh (1869), 19 Ohio St. 536; Spence v. Emerine (1889), 46 Ohio St. 433, 21 N.E. 866, 15 Am.St.Rep. 634. See 30 American Jurisprudence, 270, Section 175. It would seem to follow as a corollary that the authority of one to execute a warrant of attorney to confess judgment against another should not be recognized unless expressly conferred.

In our opinion, the evidence before the trial court on...