Magallen v. Gomes

WAIT, J. This is an action on a promissory note secured by a mortgage to recover a balance remaining due after foreclosure of the mortgage. The note was signed Michael R. Gomes, Trustee, and it is the contention of the defendant that there was error in holding him liable personally upon the note. No question is now open on the right of the plaintiff, the surviving payee of the note, to maintain an action upon it. The single question is whether the defendant is protected from personal liability by section 42 of the Negotiable Instruments Act, G. L. (Ter. Ed.) c. 107. That section provides: Where the instrument contains, or a person adds to his signature, words indicating that he signs for or on behalf of a principal, or in a representative capacity, he is not liable on the instrument if he was duly authorized; but the mere addition of words describing him as an agent, or as filling a representative character, without disclosing his principal, does not exempt him from personal liability. There was evidence that the note was signed by the defendant, after objection by the deceased payee, on the defendants assertion that he would sign only as trustee. No words in the note recited or suggested any other principal. A conveyance was made at the same time by the plaintiff to Michael R. Gomes, Trustee, of the land then mortgaged back to secure the note. This deed disclosed that Gomes was to hold the land as trustee for his daughter upon trusts specifically set out, which gave him authority to sell and mortgage and otherwise to deal with the property and the proceeds of sale or mortgage, for the benefit of the daughter. No beneficial interest, other than rights to compensation and expenses, was reserved to Gomes himself.