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(230 P.)

shortly after receiving the note, and before FIRST NAT. BANK OF RIGBY v. CAMP-executing and delivering the contract, MacBELL et al. (No. 4143.)

Mullin mortgaged the land for $3,000; that (Supreme Court of Idaho. Oct. 21, 1924.)

upon learning this appellants refused to ex

ecute the contract, and the deal was never 1. Bills and notes im 64_Conditional delivery completed; that respondent acquired the note

may be shown as against one not holder in from MacMullin with knowledge of all these due course.

facts. At the conclusion of the evidence the As against one not a holder in due course, trial court directed a verdict for respondent; the maker of a negotiable instrument may show upon this verdict, judgment was entered, that the delivery was conditional.

from which this appeal is taken. There are 2. Evidence 420(7)–Parol evidence admis- many assignments of error but we need con

sible to show conditional delivery of negotia- sider and discuss only one, to wit, that the ble instrument,

trial court erred in directing a verdict in Parol evidence is admissible to show that favor of respondent and against appellants. delivery of a negotiable instrument was con Appellants are father and son. They inditional.

troduced testimony to the following effect. 3. Bills and notes em 497(2)-Holder has bur. MacMullin wanted to sell them the land in

den of showing that he took note without no- question for $4,000. They looked it over and tice of conditional delivery.

decided to take it. One dollar was paid Upon proof that the delivery of a negotia- down, and appellants executed a note for $1,ble instrument was conditional, the burden is 000, dated June 10, 1920, due December 1, upon the holder to show that he took without 1921, and a note for $2,999 dated June 10, notice.

1920, payable December 1, 1921, the latter be4. Bills and notes 113–Acceptance of note ing the note in suit. These notes were left

from payee as security against loss does not with MacMullin until the executed contract estop maker from setting up conditional delivery as defense in action by holder who took and abstract should be delivered, with the with notice, except to extent of payment understanding that they should not take efthereon.

fect until the deal was closed. MacMullin Where a negotiable note, delivered upon a said he owned the land and it was 'clear; condition which is not fulfilled, is negotiated to he just wanted time to get the abstract made a holder who takes with notice, the fact that out. He was to furnish the contract and the maker subsequently takes a note from the abstract the next day. On June 13, one original payee to secure him against loss does Ellsworth, cashier of respondent bank, asked not estop the maker from setting up the conditional delivery as a defense in an action by appellant T. J. Campbell if he had given the holder. If the original payee pays his note MacMullin some notes. Campbell told him to the maker, such an estoppel arises to the how the deal stood—that he had left the extent of the payment.

notes in MacMullin's care until the deal was

settled up, and if he got the abstract and Appeal from District Court, Jefferson contract all right; he would just as soon County; James G. Gwinn, Judge.

Ellsworth held the notes as anybody else. Action by the First National Bank of Rig-On June 15, before furnishing the contract by, Idaho, against Roy A. Campbell and oth- and abstract to appellants, MacMullin mort

Judgment for plaintiff, and defendant gaged the land for $3,000, the mortgage be Campbell appeals. Reversed and remanded. ing recorded on June 20. Toward the last of F. A. McCall, of Rigby, and Arthur W. contract of sale executed by him, but never

June, MacMullin delivered to appellants a Holden, of Idaho Falls, for appellants.

delivered an abstract. Appellants learned C. A. Bandel, of Rigby, for respondent.

of the execution and recording of the mort

gage, refused to execute the contract, and MCCARTHY, C. J. This is an action on a called the deal off. Respondent acquired the negotiable promissory note. The defense was note from MacMullin some time between June that the note was executed and delivered by 13 and June 15, 1920. On cross-examination appellants to one MacMullin on a deal by of appellant's witnesses, respondent brought which he would sell appellants a certain 80- out that in September, after the deal was acre, tract of land free and clear of all incum- | called off, appellants took two notes from brances, and would the next day execute and MacMullin to protect themselves, one for $1,deliver to appellants a written contract to 023.11 and one for $3,068.33. In January, that effect, and an abstract showing title in 1921, they brought action against MacMullin him free and clear of all incumbrances; that on the $1,000 note and obtained judgment by the promissory note in question was deliver-default. It is clear that the purpose of this ed by appellants to MacMullin with the un- transaction was to protect them against loss derstanding that it would not become effec- from the notes which they had given to Mactive until the execution of the contract of Mullin, one of which had been acquired by sale and the delivery of the abstract; that respondent. Appellant sought to show that

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


respondent was instrumental in suggesting answer to the latter's inquiry, that the notes and effecting this attempted settlement be- were to take effect only if the deal were tween them and MacMullin, and in the bring- closed. This was sufficient to constitute no ing of the suit. Evidence to this effect was tice of the conditional delivery, and notice rejected by the court on objection by re- to Ellsworth, the cashier, was notice to respondent. The court also sustained respond-spondent. ent's objection to the question whether any [4] Respondent contends, however, that thing had been realized by appellants on the the later transaction between appellants and judgment against MacMullin or on the notes. MacMullin, by which they took his notes to However, there is no evidence that anything protect them against loss on account of the was so realized.

notes which they had delivered to him, estops [1-3] O. S. 5883, provides as follows: them from setting up the defense based upon "Every contract on a negotiable instrument the conditional delivery of their note. There is incomplete and revocable until delivery of is some conflict in the testimony as to when the instrument for the purpose of giving effect respondent acquired the note in suit. An inthereto. As between immediate parties, and as ference may be drawn from Campbell's testiregards a remote party other than a holder in mony that it was in June, whereas witness due course, the delivery, in order to be effectu- Hart, who was respondent's cashier at the al, must be made either by or under the au- time this action was tried, testified from rethority of the party making, drawing, accept-spondent's records that it was on September ing, or indorsing, as the case may be; and in such case the delivery may be shown' to have 4. In any event it was acquired before Maa been conditional or for a special purpose only, Mullin gave his notes to appellants on Sepand not for the purpose of transferring the tember 24, 1920. The rights of respondent property in the instrument.

attached when it took the note, and whether "But where the instrument is in the hands or not it was a holder in due course must be of a holder in due course, a valid delivery there- determined as of that date. The question is of by all parties prior to him so as to make therefore unaffected by the later transaction them liable to him, is conclusively presumed.

between MacMullin and appellants. More

over, from any reasonable point of view There is no question but that a conditional which may be taken of the matter, it cannot delivery, as set up in the answer and testified be logically held that appellants should be to by appellants, would have been a defense compelled to pay respondent, and take their to appellants as against MacMullin. It was chance of recovering from MacMullin. They a defense against respondent unless it was a had a right to take the notes from MacMulholder in due course. Liberty Trust Co. v. lin, and hold them as security for what they Tilton, 217 Mass. 462, 105 N. E. 603, L. R. A. were worth, but this in no wise estopped 1915B, 144. Parol evidence is admissible to them from setting up their defense as against show such a conditional delivery. Hill v. respondent. If MacMullin had actually paid Hall, 191 Mass. 253, 77 N. E. 831; Hodge v. the notes or any part thereof, appellants Smith, 130 Wis. 326, 110 N. W. 192; First would be estopped to set up this defense to State Bank v. Kelly, 30 N. D. 84, 152 N. W. the extent of the amount they had received 125, Ann. Cas. 1917D, 1044; Key v. Usher from MacMullin. In such event, however, (Ky.) 99 S. W. 324; Norman v. McCarthy, 56 the fact that they had received the money Colo. 290, 138 P. 28; Joyce on Defenses to from MacMullen would be the basis of the es. Commercial Paper, $ 486. Further upon ap- toppel, and not the fact that they had taken pellant's producing evidence that the note the notes. Certainly it could not be claimed was delivered to take effect upon a condition that appellants would be estopped as against which was not fulfilled, the burden was up- MacMullin to set up their defense in an acon respondent to show that it took without tion brought by him upon the note merely benotice. Hodge v. Smith, supra; Holdsworth cause they had taken a note from him. Re v. Blyth & Fargo Co., 23 Wyo. 52, 146 P. spondent stands in no better position than 603; Mendenhall v. Ulrich, 94 Minn. 100, 101 MacMullin would. For a case involving esN. W. 1057. The fact that the note was de sentially similar facts and reaching the same livered to take effect upon a condition which conclusion, see Saline Valley Bank v. Peckwas not fulfilled would constitute a defect in ham, 108 Kań. 560, 196 P. 593. the title of the payee MacMullin, who nego Applying the above principles to the evi. tiated it to respondent, and, under C. S. & dence introduced in this case, it is impossible 5919 and § 5926, it was incumbent upon re from any point of view to reach the concluspondent, in order to show it was a holder sion that the trial court was justified in diin due course, to prove that it took without recting a verdict for respondent. It could be notice of such defect in the title. Wright v. argued much more logically that a verdict Spencer (Idaho) 226 P. 173. Respondent in- should have been directed for appellants. troduced no evidence to show that it took the However, in view of all the circumstances, note without notice of any defect in MacMul- we conclude that the question whether the lin's title. On the contrary, appellant T. J. | defense of conditional delivery was establish, Campbell testified, as above set forth, that he ed, should have been submitted to the jury. told Ellsworth, the cashier of the bank, in The reasonableness of the version of the

(230 P.) trànsaction given by appellants is a question Geo. D. McClintock, of Pocatello, for appelfor the jury rather than for the court. How- lant. ever, if the conditional delivery be a estab Peterson & Coffin, of Pocatello, for respondlished, the question as to whether respondent ents. took with notice is not one for the jury. The burden of proof was on respondent to show

WILLIAM A. LEE, J. Respondents, who that it took without notice. Wright v. Spen- were copartners, and doing a general mercer, and other cases cited supra. Respondent cantile business at Lava Hot Springs, brought introduced no evidence to sustain this bur- this action against appellant, a foreign corden. On the contrary, appellants introduced poration, to recover a balance of $231.25 for evidence, uncontradicted and unimpeached,

merchandise sold and delivered to a sheep to the effect that respondent took with notice. outfit, operating under the name of Jensen Under these circumstances, the case should & Keane. In the summer of 1921, appellant have been submitted to the jury with the in- had a mortgage on these sheep, that were struction that, if they found the notes were being run upon the public range in the vicindelivered by appellants to MacMullin to take ity of Lava Hot Springs. One of the herders, effect only if the deal were completed, and Nick Vial, applied to respondents to obtain that the deal was not completed through

food and other supplies for the camp outfit. MacMullin's fault, and without fault of ap

Miller, one of the respondents, communicated pellants,' they should find for appellants.

by telephone with V. G. Stambaugh, a repThe judgment is reversed, and the case

resentative of appellant at Pocatello, and ask. remanded for further proceedings in accord- ed him if the Spokane Cattle Loan Company ance with the views herein expressed. Costs was furnishing supplies to Jensen & Keane, to appellants.

and Stambaugh advised Miller that the com

pany was furnishing supplies to this outfit, DUNN, WILLIAM A. LEE, and WM. E. and that when they needed supplies Miller LEE, JJ., concur.

should have Jensen 0, K. the slips and draw a draft upon the Spokane Cattle Loan Company for the amount. It further appears

that respondents, after receiving this inforMADILL et al. v. SPOKANE CATTLE LOAN

mation from Stambaugh, began furnishing CO. (No. 4062.)

the outfit with supplies, and continued to do

so until the sheep were taken over by ap(Supreme Court of Idaho. Oct. 23, 1924.) pellant, early in September. Drafts were

drawn from time to time upon appellant for 1. Corporations Ow399 (7)-Agent authorized to inspect sheep and renew loans thereon had the purchase price of this merchandise, and impliod authority to contract for supplies to

were honored until shortly prior to August, outfit on which principal had mortgage to when appellant refused to pay a draft drawn full value of sheep.

in this manner. Madill, one of the respondWhere a foreign corporation, engaged in ents, took the protested draft, together with making loans upon bands of sheep which are the sales tickets covering the amount of the being run upon the public range in this state, draft to Stambaugh, and was told by him has an agent within the state whose authority that the office at Spokane had changed the was to inspect and renew such loans, such plan some, and were requiring his signature agent has implied authority to bind his prin-' to be attached to the draft as his 0. K. becipal upon a contract for supplies furnished to an outfit upon which the company had a mort- fore it would be paid. Thereafter Stambaugh gage to the full value of the sheep.

attached his signature to the drafts, and they

were paid, except the one for supplies fur. 2. Principal and agent Cw99_Principal cannot nished between August 19 and September 20, claim that acts within apparent scope of 1921, in the amount of $387.60, which was agent's authority for benefit of principal's interests were unauthorized.

dishonored and subsequently paid to the exA principal will not be permitted to claim tent of $156.35, leaving a balance of $231.25, that its agent acted beyond his authority, where the basis for recovery in this action. Appelsuch acts were within the apparent scope of the lant paid the draft for supplies furnished aftagent's authority, and the obligations incurred er September 6th, when it took over the sheep were for the benefit and protection of its in- under its mortgage, but refused to pay that terests.

part of the obligation which was for sup

plies furnished after August 19th and prior Appeal from District Court, Bannock to its taking over the sheep. The supplies County; O. R. Baum, Judge.

for the payment of which this action was Action by B. C. Madill and A. W. Miller, instituted were furnished by respondents to copartners doing business under the firm the outfit operated under the name of Jenname and style of the Lava Mercantile Com- sen & Keane, who held the legal title to the pany, against the Spokane Cattle Loan Com- sheep and were insolvent, or as stated by one pany. Judgment for plaintiffs, and defend- of the witnesses, were broke, and were unant appeals. Affirmed.

able to further finance the running of these For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and indexes

sheep upon the public range. Appellant, by | fused to do so it would have been forced to virtue of its mortgage, held all the beneficial | take immediate possession of the mortgaged interest to the full value of these sheep, and property at the time application was made running of them on the range during the to its representative, Stambaugh, at Pocatelmonths of June, July, and August, and until | lo, for authority to extend this credit. The they were turned over to appellant mort- fact that appellant honored drafts drawn gagee was for the benefit of appellant, and on it for these expenses during this time, and apparently, at its request.

made it a condition that the sales slips for By way of defense, appellant seeks to show supplies so furnished should be submitted to that Stambaugh's authority as an agent to its representative, Stambaugh, and his apact for it was limited to that of being an in- proval of the draft in payment therefor, we spector of loans, and did not authorize him think sufficiently establishes his authority to to pledge the credit of appellant for expenses do so, and appellant should not now be perincurred in connection with caring for its mitted to defeat recovery for the purchase various herds being operated in a manner price of these supplies so furnished by testisimilar to this one. It further appears that mony that this was not within the scope of there were some 40 outfits of this character his authority as its agent. It is a correct that Stambaugh was authorized to look after, rule of the law of agency that a principal and he appears to have been the sole rep may not deny the authority of one who representative of appellant in that part of the resents himself as the principal's agent, state.

where such principal has by its own acts It is a matter of common knowledge that given those who dealt with such agent reaabout this time there was a rapid decline in son to believe that the agent had authority the value of this class of securities, and it to bind his principal. This rule is particuwas not an uncommon practice for mort- larly applicable, where the obligations in. gagees holding this class of obligations to curred by the agent were for the benefit and arrange with the owners of the legal titles to protection of the interests of the principal. continue in possession of the mortgaged prop The judgment of the district court is aferty and continue to run their herds upon the firmed, with costs to respondents. public range for the benefit of the holders of the mortgage. This often resulted in a bene

McCARTHY, C. J., and BUDGE, DUNN, fit to both parties, but the owners of the and WM. E LEE, JJ., concur. legal titles, being insolvent and without credit, were unable to finance these operations without the assistance of the mortgagee, which was frequently extended for the benefit and protection of both parties to the trans

MARSHALL V. ENNS et al. (No. 4188.) action.

(Supreme Court of Idaho.. Oct. 22, 1924.) [1, 2] An agency, either general or special, cannot be established by the representations 1. Appeal and error C 106–Order sustaining of one claiming to be such agent, and ordi

objection to introduction of evidence not apnarily those who deal with an agent are

pealable. bound by the limitations of his agency, where tion of evidence is not appealable, under C. S.

An order sustaining objection to introduche acts beyond and without the apparent

§ 7152. scope of his authority. However, agency and the scope of the authority of the agent 2. Appeal and error Ow78(4)-Order dismiss. may be shown by the attendant circumstanc.

ing action is "final judgment," and appealable. es, and, after a careful consideration of the An order dismissing an action is in effect entire record in this case, and considering

a final judgment, and appealable, under C. S.

§ 7152. all of the facts and circumstances that were submitted to the jury, under instructions to and Phrases, First and Second Series, Final

[Ed. Note.-For other definitions, see Words which no objection has been taken, we are Decree or Judgment.] unable to see how a jury could have arrived at any other conclusion than that it was the

3. Guaranty w34 - Contract that guarantor

not liable until reasonable effort made to colintention and purpose of appellant to ex

lect from principal is conditional. tend to this outfit such financial aid as was

Where a contract of guaranty provides that necessary in order to care for these sheep the guarantor shall not become liable until reathat were being herded upon the public range sonable effort shall have been made to collect during the months of June, July, and Au- from the principal, held that such guaranty is gust, and until they were surrendered to ap-conditional, and not absolute. pellant early in September, 1921. Respond- 4. Guaranty Cm85(1)-Complaint held insufients were not in any manner interested in

cient to state cause of action on conditional the transactions between the mortga gors and guaranty. mortgagee. The mortgagors were unable to

Where, in a suit to enforce a conditional meet these expenses, and, had appellant re- guaranty, reasonable effort to collect from the

Om For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

(230 P.) principal is not alleged, held, such a complaint "The order of the county court dismissing does not state a cause of action,

the appeal is the final decision and determina

tion of that court upon the case before it, which Appeal from District Court, Bingham puts an end to the suit; and is therefore, to County; Ralph W. Adair, Judge.

all intents and purposes, a judgment, subject

to the revision of this court. It matters not Action by E. B. Marshall, doing business in what form the determination of the suit is under the firm name and style of the Wilbur put; so that it embodies the final action of the Stock Food Company, against A. P. Enns and court, it is sufficient.” another. From order of dismissal as to named defendant, plaintiff

' appeals.

Af The order in question is certainly, in its firmed.

nature and essence, a final judgment, in that A. S. Dickinson, of Blackfoot, for appel-it “finally and entirely disposes of the whole lant.

case." Marks v. Keenan, 140 Cal. 33, 73 P.

751. T. S. Becker, of American Falls, and Whit

The appellant has filed no brief or comb, Cowen & Clark, of Blackfoot, for re

specification of errors. There is no bill of spondent.

exceptions or reporter's transcript, and an

investigation of the judgment complained of T. BAILEY LEE, C. The appellant states must be confined to an examination of the in his notice of appeal that he appeals:

judgment roll. It appears from the judg“From the whole of that certain order made objection to the introduction of any evi.

ment, or order so called, that respondent's and entered in said action * sustaining the objection of the defendant A. P. Enns to

dence under the complaint was sustained ; the introduction of any testimony under the that no leave to amend was given; and that complaint in said action, and from the further plaintiff excepted. It does not appear that order of said above-entitled court dismissing plaintiff ever asked leave to amend, and this said action with prejudice as to the defendant court will not presume it for him. Nor will A. P. Enns and from the whole thereof. it presume that the ruling of the trial court

forestalled such request. There is nothing

to show the ground upon which the action The "orders" in question, incorporated in

was dismissed. However, if the record disone instrument, were as follows:

closes any sound reason, the judgment should "Order of Dismissal. The

be sustained. The facts of the case seem

above-entitled cause came regularly on for trial on March to be these: On April 7, 1915, respondent 2, 1923, same being a regular judicial day of Enns entered into a written contract with the February, 1923, term of the above-entitled plaintiff and appellant, whereby he guarancourt, and the plaintiff appeared by his coun- | teed plaintiff payment for certain goods, to sel, A. S. Dickinson, Esq., and announced ready be purchased by one Carpenter, designated a for trial, and the defendant A. P. Ends ap- salesman. The guaranty having been acpeared by his counsel, Messrs. Whitcomb, Cowen, and Clark, and T. S. Becker, Esq., and ob- cepted, plaintiff furnished Carpenter mer. jected to the introduction of any evidence chandise at various times until March 8,

upon the ground, and for the reason, 1917, at which time there was a balance due that said complaint failed to state a cause of on account in the sum of $787.33. Carpenter action as

to said defendant, and after argu- died some time in August, 1917, with the inment of counsel for the respective parties, and debtedness still unpaid, and the plaintiff being fully advised in the premises, the court brought this suit to recover upon the conis of the opinion that said objection is well tract of guaranty. The contract included the taken, and the same is hereby sustained.

following proviso: "It is further ordered that said action be, and the same is hereby, dismissed as to the de "It is also understood that the undersigned fendant A. P. Enns, without leave to amend, sureties will not be called upon to make good to which ruling of the court the plaintiff then any indebtedness which may be incurred by the and there in open court duly excepted. salesman under this contract, except only in

“Dated at Blackfoot, Idaho, this, the 2d day case that the salesman fails to pay such indebtof March, 1923.

edness after a reasonable effort has been made "Ralph W. Adair, District Judge.” by the company to collect the same from him."


[1, 2] It will be observed from an inspec After setting up the contract and the fact tion of C. S. $ 7152, that an order sustaining of account unpaid, plaintiff pleaded that Car. an objection to the introduction of evidence penter, "at the time of his death was insolis not appealable;' but a formal order dis- vent, and left no estate out of which said missing an action is in effect a final judg- amount could be paid or could be made; and ment, as contemplated by the statute, and that, upon ascertaining the fact of the said will be so considered, notwithstanding its Carpenter's death, and of his insolvency, designation. Hayne on New Trial and Ap- plaintiff made demand upon the defendants peal, vol. 2, $ 184; Black on Judgments, vol. for the payment of said balance. 1 (2d Ed.) 21, 26, and 27; Zoller v. Mc- There was no allegation whatever of any Donald, 23 Cal. 136. In the last-cited case attempt by plaintiff to collect from Carpenthe court said:

ter prior to the time of his death, or from

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