Conner v. Clark

Baldwin, J., delivered the opinion of the Court—Terry, C. J., concurring.

The defendant made his promissory note, signing it “ R. C. Clark, Trustee.” On the trial he offered to show that the agreement at the time he made it was, that he was not to be personally liable, but that the payment was to be made out of a trust fund, of which he was trustee. This evidence was rejected by the Court as inadmissible, and the defendant appeals.

It will be perceived, that the tendency of the proffered testimony was, in effect, to deny to the note the obligation it imported. The evidence proposed alters so far the contract as it appears, as to show that instead of Clark’s being bound to pay at all events, or individually, he was only to pay out of a particular fund, and, of course, not to pay it at all if the fund failed. If the word trustee had not been affixed to the signature of Clark, it is clear that no such proof could be made, for it would clearly contradict the writing. , It is argued, however, that the addition of this term is sufficient to vary the rule.

Story on Promissory Notes, sec. 63, says : “As to trustees, guardians, executors and administrators, and other persons, acting en autre droit, they are by law generally held personally liable on promissory notes, because they have no authority to bind, ex directo, the persons for whom, or for whose benefit, or for whose estate they act; and hence, to give any validity to the note, they must be deemed personally bound as makers. It is true, that they may exempt themselves from personal responsibility, by using clear and explicit words to show that intention; but, in the absence of such words, the law will hold them bound. Thus, if an executor or administrator should make or indorse a note in his own name, adding thereto the words 1 as executor,’ or ‘ as administrator,’ he would be personally responsible thereon. If he means to limit his responsibility, he should confine his stipulation to pay out of the estate.” Story on Agency, p. 176, asserts the same doctrine.

The question here is not, as the counsel for the appellant has ingen[171]ionsly suggested, whether a principal can be bound on an unsealed contract, where the writing intimates and notifies, by general words, the fact of agency, and paroi evidence explanatory of the fact intimated is given. But here there is no doubt that the person signing as trustee was bound ; but he wishes to prove that he was to be bound only in a certain way, that is, to pay out of a particular fund. It is not pretended that any one else was bound by this contract. No authority is shown in Clark to bind the beneficiaries in this trust by this note. In form and legal effect the note binds him to pay this amount; but he wishes to add to this note another term, namely, that he was only to pay it out of a certain fund; and this, he wishes to prove, was a contemporaneous paroi agreement. But the rule is, that the written contract is considered the definitive agreement of the parties, and paroi conversations and understandings are all merged in it. It is the only authentic evidence of the understanding of the parties.