Harris v. Johnston , 54 Minn. 177 ( 1893 )

Mitchell, J.

The defendants in the record, Johnston, Smith, Searle, and the two Bushnells, being the owners as tenants in common of certain lands, each of them, other than William M. Bushnell, executed a separate power of attorney to William M. Bushnell, (Exhibits A and C of the complaint.) William M. Bushnell, for himself, and as attorney for the other defendants, under these powers, sold some of the land, and took as security for the purchase money (as we infer) the promissory note described in the complaint, payable to the order of all five of the defendants jointly, and subsequently sold and transferred it to plaintiff with what purported to be a joint “indorsement” or “guaranty” of all the payees. This action is brought on this indorsement or guaranty. The defense is that it was not authorized by the power, because— First, it is a contract of guaranty of payment, and not of “indorsement;” second, the separate powers did not authorize the agent to bind either of the defendants jointly with the others; and, third, that the instrument was not a promissory note. The third ground has been decided adversely to defendants’ contention, at the present term, in Hastings v. Thompson, post, p. 184, (55 N. W. Rep. 968.) We do not find it necessary to consider the first, because, in our judgment, the second is decisive of the case. It is as fundamental as it is elementary in the law of agency that a formal instrument conferring authority will be construed strictly, and can be held to include only those powers which are expressly given, and those which are necessary and essential to carry into effect those which are expressed. While all these parties had an interest in the land, the powers of attorney were several and separate, and authorized the sale and conveyance of the interest of each, and the disposition of the notes and mortgages taken for purchase money therefor separately, and not jointly, with the interest of the others. The authority in each instance was to convey by warranty deed the interest of the grantor of the power in the property. It could hardly be claimed that this would authorize the attorney to execute a joint deed in behalf of all the owners, of the whole of any tract, so as to bind each by covenants of warranty of the title not only of his own interest, but also of the interests of his cotenants. So, too, with the authority to indorse notes “taken and secured by mortgages on any of said lots.” This must be construed in connection with what precedes. It evidently refers to notes taken for the interest of the grantor of the power, and running to him separately, and not notes taken for the interests of the other owners of the property, or to notes running to him and them jointly. In accordance with the doctrine already announced, it is held that authority to bind a principal as a party to a negotiable instrument, unless otherwise expressed, is authority to bind him separately, and not conjointly with another; or, to state the rule more generally, a power to an agent to act for his principal, in the absence of any thing to show a different intention, must be construed as giving-authority to act in the separate individual business of his principal. Daniel, Neg. Inst. § 276; Stainback v. Read, 11 Graft. 281. This has been held to be the rule even where binding him conjointly with another does not affect him injuriously. First Nat’l Bank v. Gay, 63 Mo. 33. In this case, by joining one of the defendants jointly with the others in an indorsement of a joint note running to all, each of them is made liable, not merely for that part of the note belonging to him, and which was taken for Ms interest in the property, but for the entire amount of the note, taken for the interest of all, and belonging to all. This was clearly not authorized by the power. It may be, as suggested, that in real-estate transactions of this kind it would have been more convenient to have provided for the execution iff joint deeds, taking back joint notes and mortgages, and for joint indorsements. If so, it would have been very easy, if the parties so desired, to have executed joint powers of attorney to that effect; but they have not done so, and there is nothing in the separate powers expressing or indicating any such intention.

(Opinion published 55 N. W. Rep. 970.)

Judgment reversed.