The opinion of the Court was drawn up by
Davis, J.This is a suit by an indorsee against the maker of a promissory note, given to the Com. M. M. Ins. Company, and indorsed in the name of the company, " by G. H. Eolger, President.” The principal defence at the-trial, was, that Folger had no authority to make the indorsement. The case comes before us on exceptions to the *425instructions given to the jury, and refusals to give certain instructions requested by the defendant.
It was not claimed by the plaintiff that the by-laws of the corporation conferred a general authority upon the president to indorse notes belonging to the company. That the power conferred by the by-laws was a restricted one, and that a general authority could only be found from other evidence in the case, was in accordance with the instructions given, which we think were correct. There was, therefore, no reason for giving the instruction embraced in the last request. The jury were, in fact, substantially instructed that the by-laws alone conferred no such general authority.
It is a point that has often boon overlooked in cases like this, that the authority to be proved is not one to bind the corporation by a contract of indorsement, — but simply an authority to transfer the property of the company. Though generally, they are not always, the same. The payee of a note may be estopped by his conduct from claiming property in a note, when ho would by no means be held liable as an indorser. This more frequently happens when notes are transferred by agents of corporations, with the knowledge and implied assent of the officers and members thereof. But there are cases where the same principle has been applied to individuals. Thus, a note was given to a wife, during coverture. By the lex loci, the common law not having been changed by statute, the note belonged to the husband, and could be indorsed only by him. He told the wife she might have the note, and do what she pleased with it. She indorsed it; the indorsee brought a suit thereon in his own name; and it was held that the Imsband was bound by the indorsement, as made by his consent and authority. Stevens v. Beals, 10 Cush., 291. It would not have been; pretended that he was liable thereon as indorser.
If the indorsement is sufficient to pass the property, so as to protect the maker in paying the note, that is all that is necessary to render him liable to the indorsee. The instruc*426tions in this respect were as favorable to the defendant as he could claim.
It was contended at the trial that the company were insolvent at the time they issued the policy for which the note was given, and that the note was fraudulent in its inception for that reason. And the jury were instructed that if, when the policy was issued, the company were insolvent, and this fact was known to the officers who issued it, and took the note therefor, then the note was obtained by fraud, and was void, except in the hands of innocent indorsees.
The defendant requested the Court to instruct the jury that, " if the company held themselves out as solvent, they are to be held to know whether they are so, or not, and, if insolvent, the matter is to be treated as if they knew they were so.”
This request was refused, and, we think, rightly. The officers of a mutual marine insurance company can seldom know absolutely that it is solvent. We think they should be held to use due diligence and care to keep informed in regard to the ability of the company to pay the losses insured against; and if they should be guilty of negligence in this respect, issuing policies when, if doing business as prudent and careful men, they might know the standing of the company and that it was insolvent, there would be good reason for holding them guilty of fraud. But no such instruction was requested.
Whether the company has the right to purchase bank stock, and transfer their assets in payment therefor, is a question which their creditors' might have raised, in another form. But not having been raised elsewhere, it cannot be controverted by the defendant in this suit.
Exceptions and motion overruled.
Judgment on the verdict.
Tenney, C. J., Rice, May, Goodenow and Kent, JJ., concurred.