The Opinion of the Court was delivered by
Mclntire, as the assignee of the “ Ocean Insurance Company,” sued Preston in an action of debt upon a note given to that Company. The declaration is in the usual form. The defendant pleaded nil debet, payment, set-off, and accord and satisfaction, upon all of which pleas issues were joined.
By consent of parties the case was tried by the Court, and upon the trial the plaintiff offered in evidence the Act of the Commonwealth of Massachusetts incorporating the Ocean Insurance Company, a section of the Constitution of Massachusetts declaring what laws should be in force in that Commonwealth, the first section of the statute of III. and IV. Anne, Ch. 9, making promissory notes assignable, &c., the report of the decision made by the Supreme Judicial Court of Massachusetts in the case of Jones v. Fales, for the purpose of showing that the said statute of Anne was held to be in force in Massachusetts, and the note and the indorsement thereon, which was all the testimony in the case. The Court found for the defendant upon the plea of nil debet, and for plaintiff upon the other issues. A motion for a new trial was made, overruled, and an exception taken to overruling the same.
The assignment of errors questions the correctness of the decisions of the Court refusing a new trial and entering judgment in favor of defendant.
In determining this case several important questions arise:
1. Was it necessary for the plaintiff under the issues, in order to show his right to sue, to prove the existence' of the corporation to which the note was made payable ?
2. Had the “Ocean Insurance Company” power to take and assign the note in question ?
3. Was the indorsement, “without recourse, Joel Scott, Sec’y;” upon the back of said note, sufficient to transfer the legal interest therein to the holder of said note, and did it authorize the filling up of said indorsement in the manner it was done?
Some other questions of minor importance were raised during the argument, which will be disposed of as we progress.
Upon the fiz’st point, as to the necessity for proof on the part of the plaintiff to show that the “Ocean Insurance Company” was duly incorporated, the argument seems to have proceeded upon the assumption that said coznpany was the plaintiff in the action. Such is not the case. The suit is brought by Charles Mclntire, a natural person, whose capacity to sue cannot surely be questioned under the general issue. Had the suit been in the name of the payees of the note, the question of their capacity to sue, might, according' to some authorities, have been raised under the general-issue, and without a special plea for that purpose. - Upon; this point there is a great contrariety of decisions, as-, was. shown upon the argument; but, in our opinion, the better rule is, that in suits brought by corporations, the defendant, by pleading the general issue, admits the capacity of the plaintiff to sue, and thatifthe defendant would deny the existence of the corporation, he must put in a plea for that purpose.
Such has been held to be the law by the Supreme Court of tlte United States, the Courts of Massachusetts, Connecticut, Alabama, and several other States, and in our judgment, the decisions of those Courts are the best sustained both by reason and authority. In the cases of Phœnix Bank v. Curtis, 14 Conn. 437, and of Prince v. Commercial Bank of Columbus, 1 Ala. 241, the leading cases upon this subject are collected and reviewed. See also, 4 Peters, 480; 4 Blackf. 202; 9 Ala. 513; 1 Mass. 159; 3 Pick. 245; 16 Conn. 421; 7i Mon. 584; 6 New Hamp. 197.
Secondly. Was it necessary for the plaintiff to introduce in evidence the charter of the “Ocean Insurance Company,” not for the purpose of showing its authority to bring suit, which would have been admitted by the pleadings, even had the suit been in the name of the corporation, but for the purpose of shoxving the power of the company to take and assign notes ? Unless such a power can be inferred as necessary or incident to the purposes for which insurance companies are established, it was necessary to make such proof. The Court is bound to know, judicially, something of the nature and objects of insurance companies, as well as the purposes for which they are created. Is the power to take and transfer a note incident to the exercise of their usual functions? It is said in 1 Phillips on Insurance, 205, “Generally, the premium on the whole sum named in the policy as insured, is considered in practice to be due immediately, though in the United States it is not usually payable until after the expiration of a credit of from txvo. or three, to eighteen months, according to the length of the voyage.” “In the case of insurance by an incorporated Company, the premium note is generally made payable to the Company by its corporate name, or to some of its officers;” accordingly, the Company, or its officers “may negotiate the note immediately.” Ib. 206. In the case of the N. Y. Fireman’s Ins. Co. v. Ely, 2 Cowen, 678, the Court say: “It may be con-. ceded that the Company have authority to take notes for • the premiums due to them, instead of demanding cash, because the power of giving credit may be necessary to enable them to make the most advantageous contract of Insurance.” If the Ocean Insurance Company had authority to take a note for any purpose, the note in question would be valid in the hands of the plaintiff, a bona fide assignee, although the Company may have had no power to take this particular note. This was held to be the law in the case of Wilmarth v. Crawford, 10 Wend. 341. If the charter of the Ocean Insurance Company was wholly silent as to the power of the corporation to give' credit for premiums and take notes in payment, we should feel bound to decide upon the principles laid down in the foregoing authorities, that such a power necessarily resulted from its power to make insurances, and to enable-it advantageously to conduct its business; and we think it would be going quite far to hold that the plaintiff was bound in the first instance to introduce the charter in evidence, for the purpose of showing that the Company was not restricted by the Act of incorporation from doing business in the manner usual and customary to insurance companies.
But the power of the Ocean Insurance Company to take the note in this case does not rest upon the presumption that insurance companies usually exercise such a power. The plaintiff introduced in evidence upon the trial, the Act of the Commonwealth of Massachusetts incorporating said Company, by the first section of which Act the Ocean Insurance Company is created a corporation, authorized to sue, &c., and is invested “with all the powers and privileges granted to insurance companies, and subject to all the restrictions, duties and obligations contained in a law of this Commonwealth, entitled “Jin JLet to define the powers, duties and restrictions of Insurance Companies,” passed February 16, 1818, and in a law entitled “Jin Jlct authorizing the several Insurance Companies of this Commonwealth to insure against fire,” passed February 21, 1820, and is further authorized “to purchase, hold and convey any estate, real or personal, for the use of said company; provided the said real estate shall not exceed the value of fifty thousand dollars, excepting such as may be taken for debt, or held for collateral security for money due to said Company.” The first section of the Act of 1818 expressly authorizes insurance companies to make insurances on vessels, &c., and “to fix the premiums and terms of payment;” and the third section of said Act authorizes insurance companies to loan a portion of their capital stock on mortgage of real estate, &c. The power to take and transfer notes in the legitimate business of the corporation is clearly recognized in the foregoing sections. The power to hold and convey any estate, real or personal, to make insurances and fix the premiums and terms of payment, and to make loans, necessarily implies the power to take notes; nor was the power to take notes under the provisions of the foregoing sections seriously questioned upon the argument; but then it was insisted, that this power may have been taken away by the provisions of the “ Act authorizing the several Insurance Companies of this Commonwealth to insure against fire,” passed in 1820, referred to in the charter of the Ocean Insurance Company, and which Act the bill of exceptions shows was not offered in evidence.
The Act incorporating the Ocean Insurance Company was passed in 1830, and because an Act previously passed authorizing insurance companies to insure against fire, and referred to in the charter, was not offered in evidence, we are asked to infer that there are provisions in that Act restraining and taking away the powers granted in the charter and in the general law in reference to insurance companies, both of which are set out in full in the record, and were read upon the trial of the cause. It is said that the Court cannot determine whether the Ocean Insurance Company had power to take a note, because one of the Acts referred to in the charter of that company is not before the Court. The power to take a note may, as we have already shown, be fairly inferred from the first section of the charter; and if there were provisions in a former Act, referred to in a previous part of said first section, inconsistent with this power, the last law would prevail; but we think it carrying the doctrine of presumption quite too far, to assume that there are provisions in an Act extending the powers of insurance companies so as to authorize them to insure against lire, inconsistent and repugnant to the whole scope and tenor of the laws granting powers to such companies.-
After the plaintiff had shown the power to take a note on the part of the corporation by the production of their charter, we do not think it was necessary for him further to show that such power had not been taken away by some other statute, although such statute may be referred to in the charter. Having shown the power to exist, it was unnecessary for the plaintiff to show, negatively, that it had not been taken away, and especially would this be so, when the Act as referred to by its title, professed, as in this case, not to limit, but to extend the powers of the Company. If there were restrictions in the Act to authorize insurance companies to insure against fire, prohibiting such companies from taking notes in any case, it was incumbent on the defendant to have shown it, if he could, after having expressly recognized that power by executing the note in question. The plaintiff made out a prima facie case at least, of power on the part of the corporation to take the note, and this was sufficient unless rebutted.
( The corporation having the power to take a note, and to hold and convey any estate, real or personal, would necessarily have authority to negotiate such note in the ordinary transaction of the business of the Company, and that such a power is usually exercised by insurance companies has already been shown. That the note in question was made and transferred in the ordinary course of business will be inferred, in case the corporation had power to make and transfer a note for any purpose, till the contrary be shown; and it would not even be admissible in this case, without first showing the plaintiff not to be a bona fide assignee, for the defendant to show the contrary. 3 Wend. 94; Angel! & Ames on Corporations, 144; 6 Wend. 615. The note being payable to the Ocean Insurance Company in its corporate capacity, prima facie no other evidence of user was necessary. 9 Ala. 516; 14 Johns. 238.
The power of the Ocean Insurance Company to assign this note has, however, been questioned, upon the ground that the statute of Illinois in reference to negotiable instruments, (R, L. 482,) while it authorizes notes to be made by any person or persons, body politic or corporate, only authorizes the assignment of such as are payable to any person or persons, and under the hand of such person or persons, which, it is insisted, means natural persons, and does not embrace corporations; and that they had no right at the time the note in question was indorsed, to assign notes in this State. Two answers may be given to this objection:
1. By a fair construction of the statute we think corporations might assign notes in this State. The word ‘person’ is sometimes so construed as to include corporations. The People v. Utica Ins. Co. 15 Johns. 357.
2. The Ocean Insurance Company was located by its charter, at Boston, Massachusetts, and the presumption is, that the note was indorsed at the place where the Company did business — if so, by the first section of the Statute of III. and IY. of Anne, adopted in Massachusetts, the power to Indorse notes is not restricted to natural persons. Jones v. Fales, 4 Mass. 243.
3. Was the indorsement in this case sufficient, and was the plaintiff authorized to fill it up, so as to show an assignment by the payees of the note ?
The fifty eighth section of the eighty third chapter of the Revised Statutes declares: “In actions upon bonds, notes, and all other writings made assignable by law, in the name of the assignee, the plaintiff shall not be held bound to prove the assignment or signature of any assignor, unless the fact of assignment be put in issue by plea verified by affidavit of the defendant or some credible person, stating that he verily believes the facts stated in the plea are true.” No such plea was interposed in this case, consequently the assignment as alleged in the declaration to have been made by the Ocean Insurance Company, is admitted by the pleadings. Although this is admitted to be the law, yet, it is insisted that the plaintiff is bound to introduce in evidence an assignment purporting to have been made by the payee of the note — that inasmuch as the indorsement' “without recourse, Joel Scott, Sec’y,” did not purport to be an indorsement by the Company, it was upon its face wholly insufficient to transfer the legal title in the note, and that said indorsement, unexplained by proof, was that of a guarantor, and not of an indorser. It is difficult to conceive why Scott should have prefixed the words “without recourse” to his name, if the intention was to bind himself as guarantor. A guarantor loithout recourse would be a solecism. Such manifestly was not Scott’s intention in placing his name upon the back of the note. That corporations may do business through, and are bound by the acts of their officers, is well settled; and the Ocean Insurance Company having power to assign the note in question, it unquestionably could make that assignment through its duly authorized secretary. Story on Agency, § 53; Angelí & Ames on Corporations, 158; 3 Deslio, 254,
That Scott was the duly authorized officer to make the assignment, is admitted by the pleadings, because proof of his authority to make the assignment, would have been part of the evidence necessary to establish said assignment at the Common Law, and whatever evidence would have been admissible and required of the plaintiff, independent of the statute, is to be considered as given, unless the assignment is put in issue by plea verified by affidavit. . That the authority of'the agent to act for his principal need not be proved in such a case, has already been settled in principle by this Court, in the case of Delahay v. Clement, 2 Scam. 575.
This point of the case is, then, presented in the same light as if the record contained proof, that Joel Scott made the indorsement upon the note as the secretary, and under the direction of the Ocean Insurance Company. If he did, there can be little difficulty in determining that the indorsement was sufficient to carry the legal title to the note, and authorize the holder thereof to fill it up so as to show said assignment to have been made for and on behalf of said Company. There can be no mistaking the intention of the parties in this case. The words “without recourse,” show that Scott intended to indorse the note, and not to guaranty the payment thereof; and the letters “Sec’y,” annexed to his name, are sufficient to indicate that he "did not suppose he was acting for himself alone.
Upon the point of the sufficiency of the indorsement, and the authority of the plaintiff to fill it up on the trial, we are not without authority. In the case of the New Eng. M. Ins. Co. v. James De Wolf, 8 Pick. 56, which was a suit against the defendant as the guarantor of a promissory note, the guaranty was as follows: “By authority from J. DeWolf, Junior, I hereby guaranty, the payment of this note. Isaac Clap.” The Court held, “with respect to the form of the guaranty, we are of opinion that the effect of it must be determined by the intention with which it was made. If Clap had authority to make the guaranty for the defendant, and the words are such as not merely to bind himself alone, and it can be ascertained that he intended to act for DeWolf, the latter will be bound. The authorities cited to maintain the position that the name of the principal must be signed by the agent, are of deeds only, instruments under seal; and it is not desirable that the rigid doctrine of the Common Law should be extended to mercantile transactions of this nature.” The Court being satisfied from all the circumstances, that Clap professed to act for DeWolf, add, that the only question ought to be whether he had authority so to act, and the evidence showing that he had such authority, DeWolf was held liable.
In the case of the Northampton Bank v. Pepoon, 11 Mass. 288, the note was payable to the Berkshire Bank, and was indorsed by Simon Earned, calling himself attorney. It was objected that, admitting Earned to have been the attorney of the Bank for the purpose of indorsing the note, yet, the manner in which he had executed the power defeated Ms purpose, as he had not declared that he acted for and on behalf of the corporation. Parker, C. J., in delivering the Opinion of the Court, says: “If the authority of Larned was good to indorse as attorney, he having indorsed in blank, the plaintiff may erase the words written over his name, and substitute other words which will give effect to the indorsement.”
In the case of Folger v. Chace, 18 Pick. 63, it was held that a note indorsed “P. H. Folger, Cashier,” was sufficiently indorsed to pass the interest of the payees, the Phoenix Bank, in said note, and that if it was not sufficiently certain, the plaintiffs would have the right at the trial to prefix the name of the corporation.
In 6 Hill, 443, where a party placed the figures “1, 2, 8,” upon the back of a bill of exchange, no name being written, it was held a valid indorsement, and that a person might become bound by any mark he thought proper to adopt, provided he intended to bind himself. See ,also, 6 Wend, 443, and 7 J. J. Marshall, 84.
We are, therefore, of the opinion that the indorsement in this case was sufficient to pass the legal interest in the note, when properly filled up, which the plaintiff had the right to do upon the trial.
The finding of the Circuit Court was manifestly contrary to the evidence, and the motion for a new trial should have been allowed.
The judgment of the Circuit Courtis reversed at the costs of the defendant in error, and the cause remanded for further proceedings not inconsistent with this Opinion.