Righter v. Sedgley

SULLIVAN, PJ.

“It is claimed that there was no presentment of the note for payment, and notice to the endorsers and consequently that there can be no recovery. It is plain that the letter was a written demand for payment, and it appears clear that Righter received notice of its content. The only conflict being as to when, but inasmuch as there is credible evidence that he received notice upon the date it was written that fact is material, as it furnishes a basis to support the judgment.

We think the case of York v. The Franklin Tractor Co., 22 O. L. R. 377 is decisive of this case as the facts are substantially similar. In that case the endorsers were the officers in control of the corporation, and the note in question had been deposited at the bank for collection. Notice was given to the company but not to the endorsers, and it was undisputed that there were no funds available for taking up the note.

The Court of Appeals of Franklin County held that inasmuch as the endorsers were the officers in control of the corpoi’ation that the funds in law and effect were for their own advantage and accommodation, and that as directors and officers and controlling the corporation, they were in law bound to know the conditions of the note and that it was not paid when due and that they cannot be heard to say that they did not know, as individuals what they were bound to know as officials. The same rule we think applies in the present case. Righter and the other endorsers, endorsed the note personally for the purpose of securing money for the corporation, which was in practical effect, securing the money for their own personal benefit, that being the original purpose for which Righter and the others originally became endorsers upon the note.

Thus, under the reasoning of The Franklin Tractor Co., Supra, even if the defendants did not have actual notice of the dishonoring of the note, under the law of the case they would be bound as endorsers, by reason of their official relationship, to the corporation, and their opportunities for absolute knowledge of the existence of the note, and the promise therein contained. Practically speaking, the note was for their accommodation, and technically speaking, for the corporation.

We think under the decision of the case just mentioned, that they were bound with knowledge even though there was no actual notice, but as stated before, there is credible evidence in the record that the treasurer of the corporation who was conducting the finances of the corporation had written notice of demand and dishonor.

We think the ease was submitted properly to the jury, and that there was credible evidence under the rule of law to sustain the verdict.

Thus holding, the judgment of the lower court is affirmed.”

Vickery, J., and Levine J., concur.