Swift & Co. v. Miller
| Decision Date | 06 June 1916 |
| Docket Number | No. 9055.,9055. |
| Court | Indiana Appellate Court |
| Parties | SWIFT & CO. v. MILLER. |
OPINION TEXT STARTS HERE
Appeal from Circuit Court, Knox County; B. M. Willoughby, Judge.
Action by George S. Miller against Swift & Co. From a judgment for plaintiff and an order denying a new trial, defendant appeals. Reversed and remanded.Clarence B. Kessinger, of Vincennes, for appellant. Harry R. Lewis, of Vincennes, for appellee.
This suit was brought by appellee, Miller, against appellant, Swift & Co., to recover on two checks drawn by L. N. Elson on the German National Bank of Vincennes, Ind., payable to the order of Swift & Co., and indorsed as follows: Appellant's demurrer to the complaint for insufficiency of the facts alleged to state a cause of action was overruled. Appellant answered the complaint in five paragraphs, the first of which was a general denial. A demurrer for insufficiency of facts alleged to state a defense to appellee's cause of action was sustained to each of the amended third and fifth paragraphs of answer. A trial by court resulted in a judgment for appellee for the amount of the checks.
Appellant has separately assigned as error the ruling on the demurrer to the complaint and to each amended paragraph of answer aforesaid, and also the overruling of its motion for a new trial.
The facts stated in the complaint are, in substance, as follows: At and prior to the time the checks sued on were drawn, appellee was engaged in the drug business in the city of Vincennes, Ind., and was also a subagent for the American Express Company, and sometimes did business for the company under the name of “Miller Brothers.” One L. N. Elson was employed by Swift & Co. to sell its goods in the city of Vincennes, and to collect therefor, and he frequently brought orders from appellee for the purpose of remitting to appellant collections made by him in its business. In paying for such orders Elson gave to appellee money and checks. The checks were payable to appellant, and were indorsed as follows: Among the checks given appellee were those in controversy, one for $244, dated September 11, 1913, and one for $552.24, dated October 13, 1913. A copy of each of said checks is filed with and made a part of the complaint. Appellee issued express money orders on the American Express Company, payable to appellant, for the amount of the checks, and paid the Express Company therefor. Thereafter appellee caused said checks to be presented to the bank on which they were drawn for payment, and payment was refused. Thereupon appellee notified appellant of the refusal of the bank to pay the checks. On November 22d appellee again notified appellant in writing by registered mail. Appellee also demanded payment of each of the checks from L. N. Elson, and payment was refused. Appellee thereupon notified appellant of the nonpayment of each of said checks, which demand and notice was made and given immediately after the bank had refused payment of each check. By reason of the facts aforesaid appellant is indebted to appellee in the sum of $796.24, which amount is due and unpaid.
[1] Appellant's memoranda accompanying the demurrer to the complaint is denominated “argument,” and is assailed by appellee as insufficient to present any question under the sixth clause of section 344, Burns 1914 Statutes. The memoranda is subject to criticism, but, looking to its substance rather than its form, we think it substantially meets the requirements of the statute, notwithstanding the misleading and erroneous appellation given to it. The substance of the memoranda is that the complaint seeks to hold appellant liable as an indorser; that as an indorser it is entitled to all the rights and defenses authorized by the common law and commercial usage as the same have been enacted into the statutes of our state ; that the complaint does not show due diligence on the part of appellee when the checks were dishonored, in the giving of notice to appellant; that the complaint does not show that appellant was notified within the time prescribed by the statute.
[2] The complaint charges that the checks were duly presented for payment, and the bank on which they were drawn refused payment, and that “he *** thereupon notified the indorser, Swift & Co., *** of the refusal of said bank to pay said checks and each of them.” The word “thereupon” signifies that the bank was “immediately, at once, without delay” (Webster's Dictionary), so notified.
[3] There was no motion to make the complaint more specific; and, as against the demurrer, the complaint is not objectionable on the ground alleged, and was not insufficient on any ground presented by the memoranda. The court, therefore, did not err in overruling the demurrer thereto.
As already shown, the first paragraph of appellant's answer was a general denial. The second paragraph is drawn on the theory of fraud by appellant's former agent, Elson, and appellee, in the drawing and acceptance of the checks in the manner aforesaid to procure the money from appellant.
The third amended paragraph of answer proceeds on the theory that the indorsement of the check for $244 in the manner aforesaid was unauthorized, and that there was unreasonable delay in presenting the checks to the bank for payment. It alleges, in substance, that as to that part of appellee's complaint which seeks to recover upon the check for $244 dated September 11, 1913, appellee ought not to recover, for the reason that said check was indorsed by appellant to appellee on September 11, 1913, was held by appellee for a period of seven days from that date before the same was presented for payment to the bank on which it was drawn; that this check was signed and indorsed by said L. N. Elson without the authority of appellant.
The fourth paragraph of answer, in substance, alleges: That L. N. Elson was the agent of appellant in Vincennes, Ind., to sell its products and collect for the same. That appellant provided said Elson with a stamp in form as follows: That said stamp was furnished for the sole and only purpose of enabling said Elson to indorse checks of appellant received in payment of its products for exchange payable to appellant. That appellant knew that such was the extent of Elson's authority, and that he had no right or authority to indorse his own checks with such stamp, and appellee accepted the checks in suit with full knowledge thereof, and with knowledge of the fact that Elson had no funds in the bank upon which the checks were drawn out of which the checks could be paid, but accepted the same, intending thereby to seek to hold appellant liable for the amount.
The amended fifth paragraph of answer alleges, in substance, that the check for $244 set forth in appellee's complaint was received by appellee on September 11, 1913, and the check for $552.24 on October 13, 1913; that both of said checks were drawn by L. N. Elson in manner aforesaid; that without any authority so to do said Elson indorsed said checks in the name of appellant; that each of said checks was drawn upon the GermanNational Bank of Vincennes, Ind., which bank refused payment of the check for $244 on September 18, 1913, and of the latter check on October 14, 1913; that appellee knew that Elson indorsed the check in the name of appellant without its consent or authority, and failed to notify appellant, such alleged indorsee, of the dishonor of said checks until November 22, 1913; that appellant did not know, prior to the receipt of said notice that said checks had been so drawn and indorsed by said Elson.
Two principal questions are discussed. The first is that of Elson's authority to indorse his own checks by use of the stamp furnished him by appellant, and thereby bind appellant as indorser. The second is that of timely notice to appellant as indorser, if it be held to be indorser.
It is also suggested that appellant is liable as a maker. This contention is not even plausible, for the whole theory of the case is that appellant is liable as indorser. On the theory of the complaint and the facts of the case, appellant is not liable at all unless liable as indorser of the checks sued upon.
[4] There is no claim that Elson as agent had any express authority so to do, and the question turns upon the implied authority that may be inferred from his power to sell appellant's goods and collect therefor and the fact that he was furnished with the aforesaid stamp by appellant. The authority of an agent to sell goods and collect therefor does not confer on him implied authority to bind his principal by the separate, original and independent contract of indorsement.
This proposition of law has been applied in this state in the case where the agent, authorized to sell and collect, received a check payable to his principal, for the goods sold, and, without any authority other than his power to sell goods and collect therefor, indorsed the check by writing on the back thereof, and received in person the amount of the check. Hamilton National Bank v. Nye, 37 Ind. App. 464-467, 77 N. E. 295, 117 Am. St. Rep. 333;Runyon v. Snell, 116 Ind. 164BF167,18 N. E. 522, 9 Am. St. Rep. 839;Blackwell v. Ketcham, 53 Ind. 184-186;Robinson v. Anderson, 106 Ind. 152-155, 6 N. E. 12;Knowlton v. School City, etc., 75 Ind. 103-107;Stainback v. Bank, etc., 11 Grat. (Va.) 269;Myers v. Walker Bros. Co., 104 Ga. 316, 30 S. E. 842;Pluto Powder Co. v. Cuba, etc., Bank, 153 Wis. 324-329, 141 N. W. 220; Wallace v. Bank, 1 Ala. 505; German National Bank v. Studley, 1 Mo. App. 260-264; 1 Daniel, Neg. Inst. § 290. Tiedeman on Commercial Paper, § 77, is in...
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