Societe des Mines D'Argent et Fonderies de Bingham v. Mackintosh
| Decision Date | 02 May 1888 |
| Citation | 5 Utah 568,18 P. 363 |
| Parties | SOCIETE DES MINES D'ARGENT ET FONDERIES DE BINGHAM, APPELLANT, v. RICHARD MACKINTOSH, RESPONDENT |
| Court | Utah Supreme Court |
APPEAL from a judgment of the district court of the third district and from an order refusing a new trial.
Action upon a promissory note, setting forth note, request for payment and non-payment. No allegation of fraud or collusion was contained in the complaint, but it alleged that the plaintiff had been doing business as a corporation in Utah ever since the 4th day of August, 1879, and that defendant had had business relations with it; and further, that plaintiff during such time kept a banking account at McCornick & Co.'s, under the name of F. Medhurst Commercial Director, or some abbreviation thereof and that defendant had extensive dealings with it under such designation.
Defendant's answer denied the allegations of the complaint, and set up the defense of the note being given as a personal accommodation to Medhurst, and also alleged a counter claim on the note given by Medhurst and asked that if the note sued on by plaintiff be held obligatory, that the counter claim be allowed.
The cause was tried by agreement before the court without a jury and the court made the following findings of fact:
1st. The plaintiff from a time prior to February 3rd, 1882, has been a corporate body organized under the laws of the Republic of France and doing business in Utah.
2nd. From about August 4th, 1879, until after February 3d, 1882 F. Medhurst was an agent for plaintiff in Utah, had charge of its commercial business, and did business for the plaintiff in the name "F. Medhurst, Commercial Director," and he often used abbreviations of the words "Commercial Director," in signing business papers relating to business of said plaintiff, and during said time the said Medhurst also transacted business for himself in Utah.
3rd. That said defendant, for the accommodation of said Medhurst personally, and without any consideration from said Medhurst or said plaintiff, on the 3d day of February, 1882, made and delivered to said Medhurst personally the $ 7,000 note described in the complaint, and said Medhurst personally is the payee named in said note, and the words "Commercial Director" following his name are descriptive words only, and the note was not made or delivered to the plaintiff, or to said Medhurst as the agent or "Commercial Director" of the plaintiff, or in the business of the plaintiff.
The evidence showed that Medhurst was the financial agent of the company; that Medhurst was overdrawn with his company almost all of the time. The first check was dated October 4th, 1881, payable to the order of Mackintosh for $ 4,500, and an entry upon the blotter book of the plaintiff as follows: "October 4th, bills receivable dr., to cash, R. Mackintosh, note dated October 4th, and due on or before February 1st, 1882, bearing 10 per cent. interest." This entry was made without defendant's knowledge or consent. Defendant testified that he had never borrowed any money of the plaintiff, had never received any money from it except for sampling ore, had never owed it any money and had never given such a note to the plaintiff and could not remember about the check. Witness Fox testified that he made the entry on the blotter-book at Medhurst's order, that he could not remember of ever having seen such a note. Evidence showed further the stub of a check for $ 1,700, dated February 1st, 1882, drawn by Medhurst, payable to his own order, deposited by him to his private account.
There was an entry on the stub of check "F. Medhurst, Commercial Director, loan to Mackintosh, entered February 4th," made in the handwriting of Fox, the book-keeper, with which defendant did not appear to be connected in any other way. The stub indicated that the money on the check went to Medhurst, and the books of Wells, Fargo & Co., where Medhurst kept his private account, showed on February 1st, 1882, a deposit of $ 1,700 to Medhurst's private account. Defendant testified that he never, before the trial, heard of or saw this check.
The evidence further showed that on February 1st, 1882, Medhurst was indebted to the company in the sum of $ 3,917.16. Also on February 4th, 1882, a check for $ 1,500 dated February 4th, 1882, drawn by Medhurst as Commercial Director, payable to the order of Mackintosh. Defendant testified that he and Medhurst were sitting in the office, Medhurst drew the check, handed it over to him, he endorsed it and handed it back to Medhurst. The books of Wells, Fargo & Co. showed a deposit on that day of $ 1,500 by Medhurst to his own private account. On the stub of the check was written loan to Mackintosh. Defendant testified that he got nothing, but simply indorsed the check because Medhurst asked him to do so.
The evidence further showed that on February 4, 1882, Medhurst directed Fox, the book-keeper, to enter on the stub of the check for $ 1,700, that it was a loan to Mackintosh, and on the stub of the check for $ 1,500 that it was a loan to Mackintosh, and on the blotter book $ 7,000 bills receivable dr. to note of Mackintosh, which entries were made without defendant's knowledge or consent.
The testimony bearing on the giving of the $ 7,000 note was as follows: Mackintosh testified that Medhurst represented to him that in negotiating for the Hecla mine in Montana, he and two associates were out expenses in the sum of $ 7,000, and that he wanted to borrow a note for that amount as an asset for himself and his associates, that it was a mere matter of form, that the negotiation had fallen through, and that the Old Telegraph mine was being transferred; that he stepped up to Medhurst's office; that there the two notes Medhurst to Mackintosh and Mackintosh to Medhurst were drawn, and the memorandum given by Medhurst; that Medhurst then told Fox that the note was Medhurst's personal property and was not to be negotiated, and the transaction was concluded there; that there Medhurst gave Fox an order about a check, and a check for $ 1,500 was drawn and handed over to him, and he endorsed it and handed it back to Medhurst, supposing it was on the transfer of the account; that he had talked with Medhurst once since about getting back his note, but Medhurst had replied that the arrangements were not complete, but that he would hand him back his note in a little time; that in 1884 Medhurst had left the country under a cloud. Fox testified that the note was given to him by Medhurst, with orders not to negotiate it, and that it was put in the safe, and remained there until some time in 1884. The other facts appear in the opinions.
Reversed and remanded.
Messrs. Marshall & Royle, for appellants.
Messrs. Bennett, Harkness & Kirkpatrick, for respondent.
OPINION
The plaintiff (appellant) sued the defendant (respondent) upon a promissory note as maker. Upon the trial, judgment was rendered for the defendant. The plaintiff moved for a new trial, which, being overruled, he appealed to this court from both the judgment and from the order overruling the motion for a new trial. The facts of the case are substantially as follows: The plaintiff had since 1879 been engaged in mining in Utah. It was represented in the territory by F. Medhurst and C. B. Cohen. Medhurst was the manager of its financial affairs, under the style of "Commercial Director." Cohen was the general manager of the mines. The defendant prior to and during that time, had been engaged in the business of sampling ores, with office at Salt Lake City. The plaintiff had its ores sampled by the defendant. The accounts for sampling were made out in the name of the company, and the checks given for money to pay such accounts were usually signed, "F. Medhurst, "Commercial Director," or " The financial business of the company was transacted in the name of "F. Medhurst, Commercial Director." This manner of transacting the business of the company was known to the defendant. On the 3d of February, 1882, Medhurst asked the defendant to execute to him his promissory note for $ 7,000, as a matter of accommodation to him (Medhurst). The note was, as the defendant understood, to be used as an asset in the transfer of the plaintiff's mining property here in Utah, in connection with some indefinite deal in regard to the Hecla mine in Montana. It was a personal accommodation to Medhurst, to enable him, in the transaction, to present apparently correct accounts. Medhurst promised the defendant that the note should not be negotiated, but should be held only as such asset. The note which Medhurst presented, under this arrangement, for the defendant's signature, was made payable to "F. Medhurst, Commercial Director." At the same time, in return for the defendant's action, Medhurst executed and delivered to the defendant his note for the same amount, and payable at the same date, and signed "F. Medhurst, Com." Medhurst, also, at the same time, wrote and delivered to the defendant a letter, stating that the note which the defendant had made was a personal obligation to himself, not for value, but in exchange for a note of like amount, term, and interest, given to defendant by Medhurst, and therein promising not to discount or otherwise use the note. This letter was signed, "F. Medhurst." At the same time, and as part of the same transaction, the defendant received, indorsed and handed back to Medhurst a check in the usual form, on McCornick & Co., bankers, for $ 1,500. The deposits of the plaintiff were kept at that bank under the name of "F. Medhurst, Commercial Director," and the check was signed, " In addition to the ore-sampling checks...
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