Sibley v. American Exch. Nat. Bank
| Decision Date | 15 July 1895 |
| Citation | 25 S.E. 470,97 Ga. 126 |
| Parties | SIBLEY et al. v. AMERICAN EXCH. NAT. BANK. |
| Court | Georgia Supreme Court |
Syllabus by the Court.
1. Where documents are attached to interrogatories for the purpose of proving their execution, the party at whose instance the answers thereto are put in evidence is not bound to offer also such documents; and it is improper practice for the court to require him to do so. If, however, any portion of the answers read by such party are unintelligible without the documents or a part of them, the court may require the party reading the answers to offer also the documents, or such part of them as may be necessary to the understanding of the answers, upon penalty, in case of refusal, of excluding those answers to the understanding of which such documents are necessary.
2. Where, in the trial of an action, the liability of a partner for a debt incurred by a copartner in the firm name for the account of a third person depends upon the ratification of the unauthorized act of such co-partner by the partner sought to be charged, the burden of proof is upon the plaintiff to establish the fact of ratification by a preponderance of the testimony; and a written request to that effect should have been given.
3. Actual knowledge of the character of such a debt, and of the circumstances under which it was incurred, are not necessary to bind by a subsequent ratification the partner sought to be charged. If he ratify the unauthorized act of his co-partner and assume personally to pay the same, with notice of such facts only as would put a reasonable prudent man upon inquiry, he is thereby charged with knowledge of all such facts as he might have discovered if inquiry had been pressed with due diligence; and hence a request to charge, which makes actual knowledge the test of the binding force of such ratification, leaving entirely out of consideration the effect of such constructive knowledge as might have been acquired by inquiry, was properly refused by the court.
4. All persons liable as indorsers upon a note or bill of exchange as distinguished from mere sureties by indorsement, if the paper indorsed be payable, or intended to be negotiated, at a chartered bank, are entitled to protest and notice of nonpayment. A person who merely writes his name on the back of such a paper to guaranty its payment, but whose indorsement is neither essential to nor proper in the due transmission of title in the course of negotiation, is a surety only, and is not entitled to notice as an indorser.
Error from city court of Richmond; W. F. Eve, Judge.
An action by the American Exchange National Bank against R. P. & G. T. Sibley and others. From a judgment for plaintiff defendants Sibley bring error. Reversed.
J. R. Lamar, for plaintiffs in error.
Jos. B. & Bryan Cumming, for defendant in error.
The plaintiff, the American Exchange National Bank, brought suit against the Georgia Construction & Investment Company, a Georgia corporation, as maker, and Alden Howell, D. S. Boyd, W. H. Penland, G. W. Susong, Robert P. Sibley, and Robert P. Sibley and G. T. Sibley (copartners, under the firm name of R. P. & G. T. Sibley), upon a promissory note, of which the following is a copy: Indorsed: To this action, R. P. and G. T. Sibley, in their capacity as co-partners, acting through G. T. Sibley upon behalf of said partnership, and as well upon his own behalf, made answer and pleaded as follows: (1) The general issue. (2) That the indorsement sued on was not the act and deed of the partnership; that the indorsement was placed thereon by R. P. Sibley, one of the members of the firm, without the knowledge or consent of G. T. Sibley, the other member of the firm; that the firm did not receive any of the benefit of said note, or use the proceeds thereof; that the indorsement was an accommodation indorsement, solely for the benefit of the maker of said note; and that the plaintiff discounted the same with the full knowledge that said indorsement of R. P. & G. T. Sibley was an accommodation indorsement; and that the same was placed thereon without the knowledge or consent of G. T. Sibley, the other member of said firm. Defendants further show that said G. T. Sibley has never ratified or acquiesced in the said indorsement, and, as soon as he learned of the fact, repudiated the same, and so the defendants say that neither the said G. T. Sibley nor said firm is liable upon the note.
Upon the trial of the case, the plaintiff introduced the note sued on, and closed. The defendants introduced and read in evidence certain depositions of Dumont Clark, who testified that he is, and was in August, 1888, the vice president of the American Exchange National Bank of New York City, the plaintiff in this case; that his bank discounted the note for $5,000, made by the Georgia Construction & Investment Company, and indorsed, among others, by the firm of R. P. & G. T. Sibley; that the bank refused to discount the note unless it was first indorsed by the firm of R. P. & G. T Sibley, and passed through their regular account; that he knew this indorsement was for accommodation, and that G. T. Sibley was ignorant of it at the time; that R. P. Sibley actually indorsed the note, and assured him he would acquaint his brother with the fact of indorsement as soon as he returned to Augusta, and would procure his brother's ratification of the act. The proceeds of the note were placed to the credit of R. P. & G. T. Sibley, and were drawn out by them in September and October, 1888. The checks upon which the money was paid have been canceled and returned to the maker, and it is impossible to tell by which member of the firm they were signed. The statements referred to were attached to the depositions. In answer to each of the statements, the bank received a letter from the firm, which was written on a printed blank form, admitting the correctness of the statements. Those letters are annexed to the depositions. Witness testified that he knew the handwriting of each member of the firm; that one of the letters was signed by R. P. Sibley, and the other two by G. T. Sibley. On or about December 11, 1888, the bank received another letter, in the handwriting of and signed by G. T. Sibley, and, except as indicated in the letters above referred to, the bank had received from G. T. Sibley no express ratification of the indorsement. Witness cannot recollect whether he knew at the time of the discounting of the note sued on that R. P. Sibley was president of the Georgia Construction & Investment Company. He is quite sure the bank had no connection with that company prior to the discounting of the note in suit, but at this date he cannot speak positively. To the note discounted, there was attached $10,000 of first mortgage bonds of the Carolina, Knoxville & Western Railway Company, as collateral security. The bank supposed that these bonds belonged to the Georgia Construction & Investment Company. The bank discounted the note upon the credit of the indorsements and the bonds deposited as collateral security, and knew nothing further about the matter; nor did the bank know anything about the relation between the defendant company and the Carolina, Knoxville & Western Railway Company. At the time the note was offered for discount, there were on it as indorsers the names of Alden Howell, D. S. Boyd, W. H. Penland, G. W. Susong, R. P. Sibley, and R. P. & G. T. Sibley. Witness knew only the Sibleys. The indorsement of R. P. & G. T. Sibley was not on the note when first offered for discount, but was subsequently affixed. Witness knew in a general way that the note was for accommodation, but did not know for whose benefit it was discounted, or what disposition was made of the proceeds. R. P. Sibley had talked with him about the defendant company, and had asked him to discount its notes upon the pledge of the bonds of the Carolina, Knoxville & Western Railway Company, as collateral security. Witness emphatically refused to do so, unless the notes were satisfactorily indorsed. Witness did not agree to discount this note before the name of R. P. & G. T. Sibley was indorsed upon it. On the contrary, the bank expressly refused to discount it. In consequence of such refusal, the note was then indorsed by them, and, on the additional security of this indorsement, the bank discounted it. The bonds pledged as collateral security came to the bank from R. P. & G. T. Sibley. Witness did not know where they obtained them; has no recollection of any special deposit of such bonds; and did not think the bank had any such deposit, but cannot swear positively at this date. Witness did not know that the Georgia Construction & Investment Company was interested in the building of the Carolina, Knoxville, & Western Railway. The three letters from R. P. & G. T. Sibley to the bank, referred to in the testimony of Clark,...
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