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EXTRACT FROM THE Report of Richard John Wicksteed, President and Solicitor of the Company, presented at THE Annual General Meeting of the SHARr.HOLDERs held AT Ottawa on Monday, 6th Ffbruary, 1888. • ONTARIO. Jfirst Bivieion Coui% County of Carleton. Ottawa, loth December, 1887. Masson (i.e. McCulloch or Code) vs. Wicksteed. Cheque of the President of an Incorporated Company. His liability. , J^^ Defendant held personally liable for cheque, although signed by him in his quality of President of Coffee House Company, because the :orporate name of the Comixiny was not included in the body of the cheque, or properly attached to it. This was an action brought by McCulloch, -Masson being a bor- rowed name,-to recover the value of a dishonored cheque drawn by the Defendant as President of the Coffee House Company, in his the Plaintiffs favor, for wages due by the Company to him as Manager. The cheque read as follows:— "Charge to account of temperance Coffee House Company. "T^ .K Tj 1 r ^^ , ^ "Ottawa, 30th April, 1887. To the Bank of Montreal, Ottawa, Pay to W. T. McCulloch, or • )rder, the sum of \ ifty Dollars. "$50.00. "R. J. Wicksteed, Endorsed "W. T. McCulloch." " ^''^'' ^" ^^^ ^^ "' ^''' Dr. R./. Wicksteed. -^\\\^ cheque was issued and [5ost-dated in oijedience to the following resolution passed by the Board of Directors on the 4th of March, 1887:— .- .r '^f^^r^^'i ^^f-J^ '"'''^'1'^*^ "^ '^"^"^^ ^^"^ $5000, dated 30th of April, tor Mr. McCulloch." ^ rhe Defendant signed cheque, as president, according to custom. I he cheque was discounted by Masson, but dishonored on presentment there being "no funds." No one was deceived, all the parties, Drawer, layee, Endorser, Bank, considered they were dealing with the Com- pany's cheque. It was given for work done for the Company, and was not paid owmg to the misfortune of the Company alone. The Company should have been sued. The cheque was manufactured out of an ordmary blank form issued by the Bank of Montreal, and was a fac- simile of that issued by the presidents of other local companies, notably that ot "Ihe Ottawa Gas Company," who used an ordinary blank, stamped "The Ottawa Gas Co." across one end of the face, and had it signed "F C , Managing Director, The Ottawa Gas Co." 1 he question of personal liability of the President, could not be raised, inasmuch as all the parties were fully acquainted with the circum- stances under which it was issued: until dishonored, all wera agreed that It was the Company's cheque. But even if any person had been deceived as to whose security he possessed, surrounding facts must determine the liability of the Drawer. "Whether he is so liable depends upon the '^ terms of the particular cpntract construed in connection with the sur- ' rounding circumstance.s, and the relative situations of the parties at 'the time the contract was, entered into." (Addison on Contracts, 7th Ld., p. 61.) ' ) / " When the Directors are expressly authorized to accept bills or 'I issue promissory notes on behalf of the company, the company will be '' bound if the authority is substar^tially acted upon. It need not be " ej^ercised in the very terms in which it is given, or be strictly or tech- " nically accurate in point of form." —(Ibid. 979.) ^^ See also the following American cases :— "When individuals sub- scribe their proper names to a prom- ory note, /97>«ff>«V they are "^ personally liable, though they add a dc.,cription of the character in " which the note is given, but such presumption of liability may be re- I butted by proof that the note was, in fact, given by the piakers as agents, for a debt of the principal due to the payee, with the payee's "knowledge,— (17 Wend, Rep,, 40.) ,, „ . '' Where a party dealing wUh an agent, takes his promissory note, ^^ with a knowledge of his agency, and of the liability of the principal tor the debt for which the note is given, he, thereby, charges the prin- cipal.''— (10 Mete. Rep. Mass. 160.) ,''In commercial cases, in furtherance of the public policy of en- " couraging trade, if it can, upon the whole instrument be collected, that ' the true object and intent were to bind the principal, and not merely '♦ the agent, courts of justice will adopt that construction of it, however mformally it may be expressed.— (22 Wend. Rep., N. Y., 324.) In the present case, however, there has never been any difficulty as tothehabihtyof the company. The debt has always been acknow- ledged to be that of the company, but the company has never been asked to pay. On the 28th September, 1887, it was moved by Mr. Feather- ston and secynded by Mr. Hope, and resolved : - "That the directors hereby acknowledge that the check issued by the president in favor of W. T. McCulloch, is a liability of the company, and has always been such." Dr. VVicksteed concluded by citing the judgment in "The Bank of Ottawa vs. Hamilton," (U. C. P. reports, vol. 28, p. 488) as the correct judgment in an almost identical position. IV. J. Code, (ontta, pleaded that the name of the company was not properly attached to the cheque, citing in support the following cases :— Bank of Montreal vs. Depatre, 5 Q. B. ; Foster vs. Geddes, 14 Q. B • Robertson vs. Glass, 20 C. P.; Haggarty vs. Squier, 42 U. C. R. ; Brown vs. Howland, 9 Ontario reports. Lyon, C. /—Judgment for plaintiff. The name of the Coffee House Company should have been introduced into the body of the cheque. The cheque as it stands is an order to the bank cashier to pay the amount of fifty dollars to McCulloch out of the private account of the Defendant. i The above case was heard on the 2nd December, 1887. The first inkling of such a suit having been determined on by Mr Code was a letter from him to Defendant in June. Your president, the Defendant, often brought up the matter at the Board of Directors and was always met with a smile, and the remark " that's your cheque Doctor." ' Thinking it was a good natured attempt at bluff on the part of his co-directors to coax him to pay the debt, and confident that the directors would come forward before the case was argued and pay their shares, your president did not press them further. But when the case was heard on 2nd December, before Judge Lyon, the Defendant's witnesses proved false and traitorous. Mr. Mc- Culloch swearing to statements the opposite to those he had made in the same box in August, and Messrs. Hope and Featherston were reticent, shuffling and evasive, doing all the damage to your presidents' position they could^ The president's eyes then began to open to the fact that these witnesses were prepared to injure the company provided they could only annoy him. He therefore wrote to Dr. J. A. Macpherson, the late manager, (a man, who although unfortunate in his management, is a man of refine- ment, honor and probity,) as follows : — 3 4 S 6 7 8 ,. f , . ,- , Ottawa, 5th December, 1887. " Late Miinaf;cr (). T. V. If., , . -r^ V"' 7: '?'''. ''ri'" '"'"■ $50, wliich, ,i(r,,r(Ii»K f" resolution, I made as President of (). I. C. ,..y in favor (.f W. T. McCulloch vv.is not paid owing to want of funds, .suit has hfvn l.roujjht agamsl mt- as the maker. I am defendin.', of course, as the checiue is the company s cheque for comiwny's work. I am lead lo believe ihat ihcsuii has been instigated by Hope and Featherston to pay me off for some imagined slight to them. They have behaved very meanly throughout, and now want to raise the silly .piibhle that the cheque is m/ personal che(|ue because it did not issue first from the treasurer (.Mr. James Hope). With a knowleige of the foregoing, please write me a full account of all that transiiired respecting the chetpie, and answering the following cpieries:— I Did .Mr Hope authorize you to ask me to sign chetiue when you did? ' Why did you or Mcfulloch not get it signed by Mr. Hope? What did McCulloch say when you gave it him? Did Masson ever talk to you about it? Would the bank have cashed cheque with my signature alone? VVere any che(|ues ever cashed without Hope's signature? Did any of directors ever re|)udiate checpie and say it wis mine? I u '/"f""" f",'' •'"'^a'^i'-''"'*'"" capable of doing the dirty act 1 have mentioned? 1 have defended your conduct stoutly, and expect you to answer at once the above interrogatives boldly, honestly and fully. Yours truly, ,,,, . , , , R- J- WiCKSTEED. I his brought the following reply: — T» ,, , ,,,. , , December 12th, 1887. Dr. R. J. VVicksteed, ' ' Ottawa, Dear Doctok,— I am to-day in receipt of yours dated 6th inst. hxcuse writing for I have a most abominable pen, and am also on the .sick list and too nervous to write much. I will answer your (jueries seriatim. 1. The cheque for McCulloch was voted and drawn out by me and signed by you in the in erim of .\shheM s resignation and Hope's positive acceptance of office. When 1 asked Hope for cheany had been beggared, in order to save their own pockets and to indulge their jealous spite, went to work to find out how a checjue which had been acknowledged by all the par- ties up to the time of its dishonor, to be that of the Company in fact and form, could be made to appear to be the personal checiue of the Drawer, to the eyes of the County Judges. The farcical argument advanced in Court and in Chambers was as nil fir" u^"^'*' '''''^'^ '^^'^''^'-' ^^•'^^ *> post-dated checjue is an Inland Kill of Exchange: several cases declare that Bills of Exchange drawn by a company should have a particular usual torm : this particular r)ost dated cheque has not that particular usual form; therefore it cannot be Che ue'-''''"^* cheque; therefore it must be the Drawer's personal The two Carleton Cuunty Judges agreed as to the correctness of this extraordinary argument : and one of them rendered judgment in accordance with the conclusions of the foregoing syllogism; whose premises are founded on decisions taken from various cases without any regard being paid to the difference existing between the facts disclosed in those cases ind those proved in this particular case. The judgment IS so ridiculoui m its results that I cannot help thinking that the ludees combined in an attempt to take a playful "rise" out of Dr. Wicicsteed who although a barrister is not now a regular practioner— but in this case appeared in his own defence. Let us consider the reason why cheques or bills of exchange are usually signed in a certain way on behalf of a company. It is this : ' Cheques must be properly signed by a firm keeping account at a banker s, as it is part of the implied contract of the banker, that only cheques so signed shall be paid." (Bouvier's Dictionary). In case of pronussory notes or bills they must be signed in such a way as not to deceive the parties negotiating them. These parties must not be led to think that they have a rich company as security for the payment, when they have in reality only a poor individual. In the case before us the cheque was the usual and acknowledged cheque of the Company: no one was deceived or in ignorance of the facts; but then the individual delendant was comparatively rich, and the Company absolutely poor. So that in order to have the former condemned to pay, judgments which may have been correct when taken in connection with the cases in which they were rendered, were unscrupulously applied to this case, to which they had no relation. In this way a case which ought to have been decided, following the rule of non-appealable courts, according to equity and good conscience, was decided without regard to common custom or reason. . ; . Had the judgi received a good grounding in legal logic he would have said, after hearing the argument of Mr. Code, " There are three maxims of Civil Law which apply here : /. Consensus tollit errorem 2 Modus ct amvetitio vincunt letjem, and 3. Cessante ratione legis, cessat * r 4 tu k'^V 5'- ^^ '*^'*'*'^«d signed this cheque as an authorized person on behal of the co.n|)any, and was such to the knowledge of all parties to , the cheque. I is the co.i,|^anys ch^iue." Action dismissed with costs which IS written reason. h. fhi",''*^*' ''^"" '""r '" ''""f ^ ^'y ^''' i"^«"^e"^ everybody knows this to be the company s cheque, the company never repudiated it and is will- mg to pay It when called on, but I won't allow the company to be asked to pay You are all wrong in thinking that /o be what you know is for I see that several decisions, - in cases, to be sure, very different from 'this Se l^'^'tL'" f'"'''"i'r-^^y ^^^^ '^^ '^^'■^"d^"^ '« personally ■able. I his I hold to be good law, though, when I reflect on it, it does look even to my .^..-hardened mind to be contrary to fact, custom reason, equity, and good conscience. custom, Blackstone foresaw the evils which would result from a case of apprenticeship and study in England, similar to what is now Adopted in comnleS^^^ He thus writes, at page 3. of his celebrated " Making therefore due allowance for one or two shining exceotions experience may teach us to foretell that the lawyer educated for the bL; m subservience to attorneys and solicitors will find that he has begun a the wrong end. If practice be the whole he is taught, practice r^us also be the whole he will ever know; if he be uninstmcled Tn the ele ments and first principles upon which the rules of practice should be founded the least variation from established precedents w I total^is ledlwm '"'^''^V"^- ^'" ^'"^ ^^'•'>''^ ^^^''« 'he utmost his know- ledge will arrive at ; he must never aspire to form, and seldom expect to comprehend any arguments drawn, a priori, from the spirit of he laws, and the naturnl foundations of justice." voutiv fn k"""'^ p^thod of arriving at this happy consummation so de- Ih.ii K uf '""'r'*' '" °"'^'''^' "''^'^^'y 'hat all barristers and judges shall be able to form and comprehend arguments drawn from the sr^rit of the laws and the natural foundations of justice, and for judges to a ve insSTon": fn?r " '"h"^''"''-^ "'^^ ^"^h arguments,\s,'l think i: insKst upon a full course and examination in the principles of law when studying for the profession, ^ v "^ v wnen land ^ uiill^n"/^'''''^ '' 'i^''"'' 'rS^"'' '■"'■ ^"hind Conservative Eng- iand. Util ty of a knowledge of Roman Law, as law, is undeniable formmg as it does the basis of the laws of all Latin nations. Even the Common Law of England is greatly indebted for its vigour and ph lo sophic accuracy^to Justinian's Code. ^ ^ In England the examination which must be passed before a law student can be "called" is divided in two parts-the firsf beLg he Roman law and the second in English law. He may take both at^ the Fn.H r?' °' K^"'^^ ?^' ^he Roman law first but he cannot take he English law before the Roman. He may take the Roman law any 8 time after he has kept four terms, Init rannof take the Knghsh imtil he has kept at least nine terms. This is the only remedy for the |)resent (ondition of affairs in the matter of the legal profession in Ontario. With the example of sik h a judgment as the one given hy Judge I.yon before them, the i,aw Society of U|)pcr (,anada should take immediate steps to place Roman l,aw in the I, aw Student's Curriculum. R. J. WICKSTEED. NoTK.- The above is only an Extract from the Report of the President and Solicitor of the Coffee House Company. Should time and money permit the full report will he |)rinted. It will be found interesting and useful as touching upon the history and conduct of the Coffee House; and various matters of interest to the Profession, such as ignorance, etc., of Kailiffs, abuses in Judges' Cham- bers ■'•actice, Judge's error in burden of proof, want of decorum, etc, m Court Room, etc„, etc. OTTAWA: Printed at tiik oittce ok Mason «& RfA'noliw, 45 Elgin St., 1888