LEE ተ. EVEREST. 1857. June 12. [ 293 ] difference that the plaintiff attends without subpoena, or that to make his attendance useful he previously surveys the premises? Is the defendant thereby liable, not only for the previous labour of surveying but also for the attendance to give evidence, or is he liable for the former part and the parish officers for the latter? We think not. It is undoubtedly more convenient that the engagement of the witness should be supposed to be with the party rather than with the attorney. The attorney may die, or be changed, before the witness has finished the entire duty of qualifying himself to give evidence and giving it. Then suppose he gives unfair evidence, dishonestly suppressing something for the benefit of the party, or does not properly qualify himself by the previous survey which he has undertaken, and thereby the party sustains a loss, who is to sue him for breach of duty, the party or the attorney? for the engagement must be taken to be with him if he is to pay for its performance. We are of opinion therefore that primâ facie the party, and not the attorney, is liable for such a claim as the present. No doubt it is competent to the parties to arrange otherwise and it was said that they had done so, and that the defendant's letters showed that he was to be personally liable. But we are of opinion that is not so, and that the letters are entirely consistent with the general presumption that he was acting merely as attorney or agent: and indeed, in this case, the plaintiff had put his own interpretation on these letters, and we think correctly, that the parish officers were his debtors. Rule absolute. LINDUS v. MELROSE AND OTHERS (1). (2 H. & N. 293–299; S. C. 3 Jur. N. S. 619; 29 L. T. O. S. 215; 5 W. R. 758.) Plea. The defendants say that the said alleged note is not their note as alleged. Issue thereon. At the trial, before Channell, B., at the Middlesex sittings in .. (1) Affirmed in Exchequer Chamber (3 H. & N. 177). the present Term, it appeared that the defendants were three directors of a Joint-stock Company, established under the 19 & 20 Vict. c. 47, with limited liability, and called "The London and Birmingham Iron and Hardware Company, Limited;" and that one F. Shaw, who had carried on business as an ironmonger, having sold to the Company his stock in trade, the defendants in payment thereof, signed and delivered to F. Shaw the following promissory note, which was countersigned by the secretary of the Company, "£600. "LONDON, December 31st, 1856. "Three months after date we jointly promise to pay Mr. Frederick Shaw, or order, six hundred pounds for value received in stock on account of the London and Birmingham Iron and Hardware Company, Limited. "Payable at the London "Joint-stock Bank Company, "Princes St., Mansion House, "EDWIN GUESS, Secty. "JAMES MELROSE, "G. N. WOOD, "JOHN HARRIS, Directors. LINDUS v. MELROSE. (Indorsed) "F. SHAW." It was objected, on the part of the defendants, that they were not personally liable on the note, and that it only bound the Company. The learned Judge directed a verdict for the plaintiff, reserving leave to the defendants to move to enter a verdict for them. Bovill having obtained a rule nisi for that purpose, Montagu Chambers and Manisty now showed cause: The question depends on "The Joint-stock Companies Act, 1856" (19 & 20 Vict. c. 47). By section 13, upon registration of the memorandum of association, the shareholders become a body corporate. By section 43, "A promissory note or bill of exchange shall be deemed to have been made, accepted, or indorsed on behalf of any Company registered under this Act, if made, accepted, or indorsed in the name of the Company by any person acting under the express or implied authority of the Company." This promissory note is not made in the name of the Company but of the directors: it is "we," that is, the directors, "jointly promise to pay." It may be, that this being a Company with limited liability, the payee of the note preferred the unlimited responsibility of three of the directors. The only difference between this case and Healey v. Story (1) is, that there the directors jointly and severally promised to pay. ALDERSON, B., there said: "The plain grammatical meaning of the words is, (1) 3 Ex. 3. [ 294 ] we jointly promise and we severally promise,' that is to say, we personally promise." Here the absence of the word "severally" may be explained by the supposition that the directors may have been willing to incur the responsibility with the others, though not alone. [They cited Penkivil v. Connell (1) and Allen v. The Sea Fire and Life Assurance Company (2).] (CHANNELL, B., referred to Aggs v. Nicholson (3).) There the directors "by and on behalf of the society" promised to pay. No doubt, the 43rd section of the 19 & 20 Vict. c. 47, was expressly framed to obviate the conflict of decision which arose upon the language of the 7 & 8 Vict. c. 110, s. 45. That Act required that the note should be made by and in the names of two of the directors of the Company, and should be expressed to be made by them on behalf of the Company. By the 19 & 20 Vict. c. 47, the note is to be made in the name of the Company by any person acting under the express or implied authority of the Company. (CHANNELL, B.: It may be read thus: "We promise to pay on account of the Company, for value received.") The words will have effect if read according to their ordinary construction, and therefore ought not to be transposed. Besides, it is not enough to say "we on account of the Company promise to pay," for the Act requires that the note should be made in the name of the Company. This note, not being in conformity with the requisites of the *Act, will not bind the Company, for they can only be made liable by a contract under their corporate seal, or in the mode prescribed by the Act. Bovill and J. Brown, in support of the rule: The question is, first, whether the directors who signed the note intended to bind themselves or the Company; and secondly, if they intended to bind the Company, whether they have used sufficient words for that purpose. It is evident that the directors never intended to bind themselves, for the consideration for the note was stock supplied to the Company, and the note is countersigned by the secretary of the Company. Then, with respect to its language, the words "on account of the Company," should be read "on behalf of the Company." Story v. Healey (4) proceeded on the ground that the defendants jointly and severally promised. In Penkivil v. Connell (1) the note was also joint and several. (1) 5 Ex. 381. (2) 82 R. R. 447 (9 C. B. 574). (3) 108 R. R. 503 (1 H. & N. 165). 3 Ex. 3. (BRAMWELL, B., referred to Maclae v. Sutherland (1).) In Allen v. The Sea Fire and Life Assurance Company (2), the note contained the words "on account of the corporation," and that was held to bind the Company. Aggs v. Nicholson (3) is also an authority in favour of the defendants. The language of the 43rd section of the 19 & 20 Vict. c. 47, is not materially different from that of the 7 & 8 Vict. c. 110, s. 45. POLLOCK, C. B.: The rule must be absolute. The question is, what is the meaning of this instrument, reference being had to the law and the facts proved. I am of opinion that the expression "for value received in stock" was meant to indicate the sort of consideration which passed with reference to the note, and that these words ought to be read as if they were in a parenthesis. Then, according to all the rules of construction, they may be taken out, and the instrument read thus: "Three months after date we jointly promise to pay Mr. Frederick Shaw, or order, six hundred pounds, on account of the London and Birmingham Iron and Hardware Company." This promissory note cannot bind at once the individual directors and the Company for which they were acting as agents; and the question is, what is the most reasonable construction to be put upon it? When the matter comes to be examined and presented in the way which the learned counsel have ably done, though, no doubt, there are considerations which apparently operate one way and arguments which support either proposition, I entertain no doubt that this instrument was drawn by the directors on behalf of the Company, and that they are not personally liable. The cases which have been cited do not throw any great light on the subject, but I consider every one was correctly decided, and indeed could not well have been decided otherwise. The question being, substantially, whether we are to consider this as the note of the Company or of the directors who signed it, on reading the instrument as I have suggested, and looking to the surrounding circumstances, I entertain not the slightest doubt that in fact it was intended as the note of the Company, and in law ought to be so construed. BRAMWELL, B.: I am of the same opinion. The statute does not prescribe any particular form in which a note is to be drawn; but it is enough if it purports to bind the Company, and is made by some person competent to bind the Company. Then, does this (1) 97 R. R. 332 (3 El. & Bl. 37). (2) 82 R. R. 447 (9 C. B. 574). R.R.-VOL. CXV. (3) 108 R. R. 503 (1 H. & N. 165). 35 LINDUS v. MELROSE. [ *297 ] LINDUS v. MELROSE. [298] [ *299 ] note purport to bind the Company? for, if so, it does not purport to bind the directors personally. What was really intended, no one can, *under the circumstances, have any doubt; and the question is, whether the words used will enable us to say that the intention has been carried out. If the words had been, "Three months after date we jointly promise to pay Mr. Frederick Shaw six hundred pounds for value received by the Company," and it had been signed by three directors and countersigned by the secretary, I am by no means sure that it would not have bound the Company, although it did not state that it was made "on account of the Company." It is not, however, necessary to decide that point, because here we have the words "for value received in stock." I agree with the LORD CHIEF BARON that those words ought to be read in a parenthesis, for if not, the instrument would stand thus: "for value received in stock by us on account of the Company." Then, if we suppose a personal liability on the part of the directors, there would be a promise by them to pay for value received on account of the Company, and the note would be bad on the face of it as showing a consideration to the Company and not to the directors. Therefore we must read in a parenthesis the expression "for value received in stock," in which case there is an end of all difficulty; or if the words "on account of the Company" refer to "value received in stock," then, inasmuch as that is not value received by the defendants but by the Company, the Company are bound. So, that in either view the note is not binding on the defendants personally. CHANNELL, B.: I entertained some doubt in the course of the argument, but have arrived at the conclusion that the rule ought to be absolute. Although the decided cases may assist in throwing some light on the subject, the question really depends on the construction of the note. The three defendants signed the note as directors; and the question is whether, under the circumstances, they signed it with *intent to bind themselves or the Company. Without saying that under all circumstances the words "on account of " are equivalent to "on behalf of," I think that the defendants purport to bind the Company. If the words "for value received in stock" be read in a parenthesis, all doubt is removed; or if the words "on account of the Company" be read "we jointly promise on account of the Company," in like manner there is an end of the question. Rule absolute. |