I cannot agree that § 3.403 does not apply where the note is incomplete at the time of signing. Neither can I agree that § 3.403 only applies in the limited situation where the note is complete in all respects at the time it is signed by the maker. In my view, § 3.403 governs the determination of the identity of the maker of the note whether the note was complete or blank when signed. Consequently, I cannot agree that Mentesana's affidavit, which attacks only the capacity in which he signed the note, raises a fact issue on the identity of the maker. Accordingly, I must dissent.
The majority has erroneously rested its decision on § 3.1151 governing incomplete instruments. That section provides:
§ 3.115. Incomplete Instruments
(a) When a paper whose contents at the time of signing show that it is intended to become an instrument is signed while still incomplete in any necessary respect it cannot be enforced until completed, but when it is completed in accordance with authority given it is effective as completed.
(b) If the completion is unauthorized the rules as to material alteration apply (Section 3.407), even though the paper was not delivered by the maker or drawer; but the burden of establishing that any completion is unauthorized is on the party so asserting. (Emphasis added.)
As I read § 3.115(a), that section is limited to completing the language necessary to make the writing an instrument. The note is effective as completed here because it was "completed in accordance with the authority given so as to make it an instrument." This is true because Mentesana does not assert that any incomplete blank on the note at the time he signed it was not completed as authorized, but rather asserts that the words were not added to his signature to show that he signed the note merely as an agent of another. The absence of these terms do not make the instrument incomplete in a "necessary respect" under § 3.115. See Official Comment (2) to § 3.115.
The majority holds that because the note was incomplete when Mentesana signed it he may attack by parol evidence the capacity in which he signed the note even though all blanks in the note were completed in accordance with the agreement of the parties. The majority then focuses on § 3.115(b) which states that if the completion is unauthorized, the rules pertaining to alteration apply (s 3.407). Thus, they conclude that whenever a person signs a note *Page 700 that is incomplete when signed, the maker can avoid the consequences of § 3.403(b), which establishes the personal liability of an authorized agent who fails to disclose his capacity as agent at the time he signs the instrument. The majority then holds that § 3.403 applies only to the limited situation where the note is complete in all essential respects when signed. I cannot agree because I see no difference in the situation here where Mentesana signed the note in blank and all essential blanks in the instrument were completed in accordance with their agreement and the situation where these blanks were completed before he executed the note. Thus, in both instances, I would hold that § 3.403(b) places the burden upon the person signing even an incomplete instrument to name his principal or disclose his capacity as agent in order to escape personal liability.
Section 3.403 provides:
(b) An authorized representative who signs his own name to an instrument
(1) is personally obligated if the instrument neither names the person represented nor shows that the representative signed in a representative capacity;
(2) except as otherwise established between the immediate parties, is personally obligated if the instrument names the person represented but does not show that the representative signed in a representative capacity, or if the instrument does not name the person represented but does show that the representative signed in a representative capacity.
According to J. WHITE R. SUMMERS, UNIFORM COMMERCIAL CODE s 13-4, at 403 (1972), "The Code lays down some simple rules for determining when an authorized agent's signature subjects him to personal liability. Under § 3-403(2)2 the agent's liability turns almost entirely on the written symbols he uses to disclose his agency status." Section 3.403(b)(1) sets up a hard and fast rule, mandating that a person signing only his name to an instrument without disclosing his principal or indicating that his signature is made in a representative capacity, is personally obligated on the note and is precluded from introducing parol evidence to show otherwise. Section 3.403(b)(2) allows the signer to introduce parol evidence to disprove his personal obligation, but only under very specific circumstances. First, the suit must be between the immediate parties to the note. Second, the note must either disclose the name of the principal or indicate that the signature on the note was made in a representative capacity. Id. at 403-405.
Because this suit is between the immediate parties to the promissory note, the first requirement of § 3.403(b)(2) is met. But the face of the note in the case at bar contains neither the name of the principal nor a designation of agency capacity so as to fall within the ambit of § 3.403(b)(2). See Griffin v. Ellinger, 538 S.W.2d 97, 99 (Tex. 1976). See also Seale v. Nichols, 505 S.W.2d 251, 254 (Tex. 1974). Consequently, under the facts present, I would hold that Mentesana is liable under the express language of § 3.403(b)(1) and that Mentesana's allegation that he signed the note as agent for a corporation is inadmissible as a matter of law. See Official Comment (3) to § 3.403.
Neither does the fact that the name of the alleged principal, "P.J.M. Incorporated d/b/a El Toro Restaurants," appears in the lower left hand corner of the note on lines labeled address and telephone satisfy the requirement of § 3.403(b)(2). Since the name appears only under the address and telephone label, it appears to be merely a means of locating the maker rather than the naming of a principal from which repayment is expected. On this point I agree with the Supreme Court of Georgia, which stated in Southern Oxygen Supply Co. v. Golian, 230 Ga. 405,197 S.E.2d 374, 375 (1973): *Page 701
There is nothing on the face of the note involved here which shows the agency of the signer. The fact that a name similar to that of the corporation asserted to be the real maker of the note appears in the address does not name the person represented within the meaning of the Code Ann. s 109A-3-403(2)(b) so as to make a question of fact as to whether the signer was acting in a representative capacity.
The majority's holding that Mentesana's allegation that appellee promised to later add terms to make the note reflect a corporate obligation rather than a personal obligation of Mentesana, is inconsistent with Griffin v. Ellinger, 538 S.W.2d 97 (Tex. 1976). The supreme court in Griffin stated that under § 3.403, the question is whether the instrument shows on its face that the signature was made in a representative capacity. Id. at 99. "In short, the burden is on the signer to relieve himself of personal liability by disclosing his agency." Id. at 100. The supreme court held that if the face of the note fails to disclose agency capacity, the signer is personally obligated under § 3.403. Id. In that case, the face of the note did contain the name of the principal so the supreme court considered whether the signer had "otherwise established" his representative capacity under § 3.403(b)(2) and concluded that he had not. In the case at bar, the face of the note discloses neither the name of the principal nor Mentesana's agency capacity. Consequently, applying the clear language of Griffin, § 3.403(b)(1) is the applicable provision here and parol evidence is inadmissible to prove agency capacity. Bostwick Banking Co. v. Arnold, 227 Ga. 18, 178 S.E.2d 890, 894 (1970).
In conclusion, the express language of § 3.403, as construed by the supreme court in Griffin v. Ellinger, provides that a person who signs a note as an agent is personally obligated on the note and is precluded from showing otherwise unless he meets his burden under § 3.403(b)(2) of making the face of the note reflect his agency capacity. Seale v. Nichols, 505 S.W.2d 251, 254 (Tex. 1974). This Mentesana failed to do. Accordingly, I dissent.