Western Investment & Land Co. v. First Nat. Bank of Denver
| Decision Date | 04 March 1918 |
| Docket Number | 8232. |
| Citation | 64 Colo. 37,172 P. 6 |
| Parties | WESTERN INVESTMENT & LAND CO. v. FIRST NAT. BANK OF DENVER. |
| Court | Colorado Supreme Court |
Error to District Court, City and County of Denver; Geo. W. Allen Judge.
Suit by the First National Bank of Denver, Colo., against the Western Investment & Land Company. Judgment for plaintiff, and defendant brings error. Affirmed.
Howard J. Clark, of Des Moines, Iowa, and L. Ward Bannister and Leroy McWhinney, both of Denver, for plaintiff in error.
N Walter Dixon, of Denver, Harry E. Kelly, of Chicago, Ill., and Charles H. Haines, of Denvor, for defendant in error.
The defendant in error brought suit against the plaintiff in error on a promissory note upon which the latter appeared as indorser. Verdict for plaintiff and judgment accordingly.
The note was executed by one Macarthy to the defendant below--he being at the time the president and manager of defendant company--was indorsed in the name of said company, and delivered to one Colburn in payment for an automobile. The note was subsequently and before maturity transferred to the plaintiff. Presentment and protest were duly made.
The defense was and is that the note was never delivered to the defendant, and that it never indorsed the same. It is alleged in answer that the indorsement in the name of the company was made by said Macarthy, who was also the maker of the note, of which fact Colburn had knowledge when he received the note; that Macarthy had no authority to execute and deliver to defendant the said note; that it never owned the note; and that the automobile was purchased by Macarthy for his own use, and not for the defendant.
There was evidence as to the defendant's business, of which Macarthy was in sole charge in this state; of the contract of purchase of the automobile; of the use of cars in the business; of the knowledge of some of the directors of such use; of advertising by the company that it used automobiles in its business of selling lands; of differences between Macarthy and his father-in-law, who owned more than one-half of the stock of the defendant company; of a transfer of Macarthy's stock to his father-in-law; of a charge of $10,005.95 against Macarthy on the company's books; of a resolution by the directors, and the stockholders, approving and confirming all the acts of Macarthy as president; and of his ceasing to have any connection with the defendant.
The court submitted to the jury the question whether Macarthy purchased the automobile for himself individually, or as manager for the company, and for it; also, if purchased for the company, whether Macarthy had authority to make the purchase and execute the note in suit to pay therefor. The jury was instructed that they should find for the defendant unless they found that Macarthy had authority to purchase an automobile for the company and did so purchase the automobile in question; and that he had authority to indorse and deliver the note in suit; or that his act in so doing was ratified by the company.
We cannot agree with plaintiff in error that there is no substantial evidence from which authority on the part of Macarthy either to buy the automobile, or to indorse the note for the company, may be inferred. From the evidence above recited the jury might reasonably find that Macarthy had authority to buy the automobile, and to indorse the note as he did.
Neither do we think that the court erred in refusing to give an instruction:
'That there can be no ratification of an unauthorized act done in a corporation's behalf unless the act is known to the ratifying authority, and is therefore approved.'
The requested instruction stated a general rule, to which, however, there is a well-known exception, within which the case at bar falls.
We are dealing here not with acts from which a ratification may be inferred, but with an express ratification.
It is well settled that if a principal deliberately ratifies upon such knowledge as he has, assuming such risk as there may be in failing to make full inquiry, he is bound, and cannot avoid the effect of his act on the ground of want of knowledge. Ehrmanntraut v. Robinson, 52 Minn. 333, 54 N.W. 188; Stokes v. Mackay, 19 N.Y.S. 918; [1]Wilder v. Beede, 119 Cal. 646, 51 P. 1083; Kelley v. N. & A. H. Ry. Co., 141 Mass. 496, 6 N.E. 745; Mechem on Agency (2d Ed.) § 393 et seq.; and Ewell's Evans on Agency, p. 82.
The testimony of J. K. Gilcrest, who owned more than one-half of the stock, was that:
Reading the resolution of ratification, with its all-inclusive terms in the light of this testimony, it cannot be said that the jury was not justified in finding that the purchase of the automobile and the indorsement and delivery of the note were ratified and approved. It is a fair and natural inference from the facts in evidence that the defendant company, as a consideration for the surrender by Macarthy of his stock, agreed to become responsible for all that he had done. The language of the resolution of ratification fully justifies this conclusion. It also appears that Macarthy was charged with $10,005.95, and the witnesses for defendants now disclaim all knowledge of the items of that indebtedness. They cannot explain the charge. We cannot say that the jury might not properly infer that the sum so charged was itself a consideration for...
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Sipes v. Kinetra, L.L.C.
...with equity in Defendant. People v. Manning, 672 P.2d 499, 507 n. 8 (Colo.1983); see also Western Investment & Land Co. v. First Nat'l Bank of Denver, 64 Colo. 37, 172 P. 6, 8 (1918) (reasoning that an agent's authority cannot be established by his own There is no issue of material fact as ......