Agency, Existence of relation. Husband and Wife. Bills and Notes.
At the trial of an action by an indorser against the maker of a promissory note, it appeared that the plaintiff, a married woman, became a holder in due course of the note before its maturity, that she indorsed it in blank and delivered it to a corporation to pay an indebtedness owed to it by her but charged upon its books to the name of her husband, that the note was not paid at maturity and was delivered by the corporation to the plaintiff's husband, who "handed" it to the plaintiff, and that the corporation "charged back" to the husband against certain dividends to which he was entitled the amount of the plaintiff's indebtedness to it. The trial judge found that the husband, in the transactions above described, acted as the plaintiff's agent, lending her his credit with the corporation upon the return of the note to her; and refused to rule that the plaintiff was not a holder of the note in due course or that the result of the transaction between the plaintiff's husband and the corporation was either that he became the purchaser of the note or that the defendant was discharged. Held, that
(1) The finding that the husband in the transactions above described acted as the agent of the plaintiff was warranted;
(2) The plaintiff, as the person in possession of the note with the husband's assent, was entitled to maintain the action in her own name in any event;
(3) The "charging back" of the amount of the note to the account of the plaintiff's husband with the corporation was not a payment of the note by any one but operated only to discharge the plaintiff's liability to the corporation, so that the plaintiff was remitted to her former rights against the defendant.
JENNEY, J.
On April 12, 1918, Philip Davis executed and delivered to Harry E. Burroughs his promissory note, complete and regular on its face, and payable on time. The plaintiff took the note in good faith and for value, before its maturity and without notice of any infirmity in the instrument or defect in title of the person negotiating it. The terms of the note negative its previous dishonor. The plaintiff then had the rights of "A holder in due course." R. L. c. 73, § 69. It is conceded that, before the maturity of the note, it was indorsed by the plaintiff to the Boston Egg Company in payment of her pre-existing indebtedness to that company, which indebtedness either was or could have been found to be charged on the books of that company to her husband. The note was not paid at maturity and thereafter it was delivered to the plaintiff's husband, and the sum payable according to its terms was "charged back" to the husband on the books of the company against certain dividends to which he was entitled. The husband "handed" the note to the plaintiff who thereafter brought this action.
The defendant contends that the finding for the plaintiff was wrong (1) because she had no title to the note and because the evidence is not sufficient to support a finding that she was entitled to maintain suit as a holder with the assent of her husband, who, the defendant contends, was the real party in interest; and (2) because the transaction at the time of the maturity of the note amounted to its payment and extinguished the liability of the maker.
1. The trial judge found that the plaintiff's husband in all that he did acted as her agent and that she does not claim under him. It is contended that the evidence did not justify the finding. It was sufficient to warrant the conclusion that the husband, in delivering the note to his wife, did not do so with the intent merely to give her its custody, and that he received it for her benefit and delivered it to her as her own. The note had never been owned by the husband and the inference that he received it in behalf of his wife was well warranted. The finding that he acted as her agent was therefore supported by the evidence and must stand. See Leavitt v. Wintman, 234 Mass. 248. In any event, the plaintiff, as the person in possession of the note with the assent of her husband, may maintain this suit thereon. R. L. c. 73, § 68. National Pemberton Bank v. Porter, 125 Mass. 333, 335. Fay v. Hunt, 190 Mass. 378. Jump v. Leon, 192 Mass. 511. Perry v. Pye, 215 Mass. 403, 410.
2. The "charging back" of the amount of the note to the account of the plaintiff's husband, who acted in her behalf, did not discharge the defendant. The transaction was not the payment of a note by a maker, joint promissor, stranger or volunteer and is clearly distinguishable from the principle of Lee v. Field, 9 N.M. 435, on which the defendant relies. It operated only to discharge the plaintiff's own liability to the company and she was remitted to her former rights as against all prior parties. R. L. c. 73, § 138. Berenson v. Conant, 214 Mass. 127, 130.
3. These considerations are decisive of all the defendant's requests for rulings. Inasmuch as the plaintiff was remitted to her former rights as "A holder in due course" it was not necessary for the judge to pass on the issue of fraud between the defendant and the payee. The finding in her favor was made properly. R. L. c. 73, § 74. Symonds v. Riley, 188 Mass. 470. De Reiset v. Loughery, 205 Mass. 86. The order of the Appellate Division of the Municipal Court dismissing the report must be affirmed.
So ordered.