Tabler, Crudup & Co. v. Sheffiield Land, Iron & Coal Co. , 79 Ala. 377 ( 1885 )

SOMERYILLE, J.

The action is brought by the appellants, as plaintiffs in the court below, against the appellee, a body corporate, to recover a certain amount alleged to be due them as transferrees of a large number of labor-tickets, or time-checks, issued by authority of the defendant. These instruments are printed, and are denominated, on their face, each, as being a “labor-ticket.” The name of the defendant company— the “Sheffield Land, Iron and Coal Company” — appears at the top, and not as a subscribed signature. On the right margin, and across the face of the paper, the initials “E. P. M.” occur, which are alleged to have been signed by one E. P. Miller, the agent of the defendant. The words “one day,” etc., occur, without specifying any particular sum due for such time or service, except in case of a few tickets, which call for small amounts. All of these tickets are payable June 15, 1884, “to employees only,” and are indorsed “not transferable.” No averment is made in the complaint, that they were issued as change-bills, and were intended to circulate as money, in contravention of the statute. The common counts are added, and-the averment is made, that the transferrees are unknown by name to the plaintiffs.

The Circuit Court, on demurrer to the complaint,' held that the action would not lie ; and on refusal of plaintiffs to amend, the suit was dismissed.

We are of opinion, that this ruling was free from error. The certificates show,, on their face, that they are payable to the employees only, and to no one else. They are expressly declared not to be transferable, which negatives any promise of defendant, otherwise implied, that payment would be made to any assignee or transferee of thé holders. They were issued with this express understanding, which was assented to by the employees, when they received them ; and the plaintiffs took the instruments with full notice of this restriction, because it appeared on the face of the paper. The transferability of the paper was thus destroyed, by the consent of the original parties to it.—Durr v. The State, 59 Ala. 24.

It can not be said, that the policy of the law is opposed to the restriction thus imposed. On the contrary, under the peculiar circumstances of this case, it highly favors such restriction. At common law, ohoses in action were not transferable, their transfer being enforced only in equity. This ancient rule has been abrogated only by the necessities of modern commerce. But there is a certain kind of paper, passing under the name of “ change-bills,” which are prohibited by statute to be issued in this State, without special authority of law. They include bills of exchange, notes, bonds, or “ instruments of any description, whatever may be their form or device,” which are issued with intent to circulate as money. Corporations, or other persons, who issue - or circulate such paper, without authority of law, are liable to indictment, and to a heavy civil penalty of interest at fifty per cent, per annum. — Code 1876, §§ 4433-34, 1424-26. It was very important for defendant that its officers should not be liable to this penalty or punishment. If the certificates in question were permitted to pass from hand to hand by transfer, it might be strong evidence of an intention on the part of the maker that they should circulate as money, and answer all its purposes in the business of the company, or even in the neighborhood of its residence. A proper mode of rebutting the existence of such intention was to make the paper non-transferable. There might be circumstances under which this mode of restriction would afford the only protection practicable to the maker, short of perpetual litigation rendered unendurable by the multiplicity of suits which could be instituted on such a form of paper.—Barnett v. The State, 54 Ala. 579; Bliss v. Anderson, 31 Ala. 612.

There is yet another reason, why the policy of the law would favor a contract by the employee that the promise should not be transferable, but should enure to his benefit only. Thei’e may have been discounts, by way of set-off in favor of defendant, against some of the 'employees, which could be available only so long as the names of these particular promisees .wei’e known. The paper, not being negotiable, would be subject to this equity. If allowed to pass to a stranger, it might often be impracticable to ascertain who was the original holder, and the right would thus be lost. Such certificates, or tickets, moreover, are often placed in the hands of employees as a convenient mode of making advances to them for their services, especially when payable in merchandise, as they frequently are. As the law should encourage humanity to the needy, so it should favor any contract intended to-prevent a transfer of paper which would operate as a fraud on any benevolent intentions of the maker.

The assignments of demurrer were well taken to all except the common counts. The latter counts were in the form prescribed by the Code, and the court erred in not holding them good.

Beversed and remanded.

Clopton, J. not sitting.