may appear to be just and reasonable under I was, and now is, the owner of, and the said all of the attendant circumstances. I am of the opinion, therefore, that the judgment in this respect should not be modified, as there is no contention and nothing in the record to make it appear that the amount awarded was unjust or unreasonable, or an abuse of the court's discretion under all the facts and circumstances disclosed. (31 Idaho, 244) PECK. (Supreme Court of Idaho. Jan. 7, 1918.) 1. GIFTS 19(1)-PERSONAL PROPERTY-DE LIVERY. plaintiff Luther T. McKee, treasurer of said Lewis county, Idaho, was, and now is, entitled to the possession of, for the use and benefit of the said plaintiff Lewis county, Idaho, the following described promissory notes." Here follows a description of the various notes. The answer denies ownership in either of the plaintiffs, or that either is "entitled to the possession of any of the promissory notes in the said complaint mentioned, and denies that any of the said notes LEWIS COUNTY et al. v. STATE BANK OF were made or executed for the use or benefit of plaintiffs, * * * or any of them, were ever delivered to plaintiffs, or either of them, in trust or otherwise." And it is affirmatively alleged that on the 18th day of April, 1914, the county, through its board of commissioners, let to Fike & Mitchell a contract for the construction of a public highway known as the "Central Ridge grade," for the Sum of $7,250; that thereafter the contractors completed the work, and that in the course of performance modifications were made at the instance of the commissioners, acting as individuals, which greatly increased the cost and value of the work, and that the contractors actually disbursed for labor and material the sum of $11,396.79; that the notes in question were given by certain residents and property owners who considered themselves benefited by the highway, to provide a sum sufficient to complete the work over and above the amount allotted by the county; that the notes were delivered to one Ringsage, one of their number, to be kept until the contractors should be through with their In order to constitute a gift of personal property there must be an actual and complete delivery thereof made in execution of the gift, and for the express purpose of consummating it. 2. BILLS AND NOTES 63-OBLIGATION-DE LIVERY. No obligation arises upon a promissory note until it has been delivered. 3. BILLS AND NOTES 63 "DELIVERY" STATUTE. * "Delivery," within the meaning of Rev. Codes, § 3473, providing that, "every contract on a negotiable instrument is incomplete and revocable until delivery of the instrument for the purpose of giving effect thereto, imports such a transfer of the instrument to another as will enable the latter to hold it for himself. If the maker or drawer has only put the paper into the hands of his agent to hold as such, he has not delivered it. [Ed. Note.-For other definitions, see Words and Phrases, First and Second Series, Delivery.] 4. REPLEVIN 72-DELIVERY EVIDENCE. Held, that under the evidence in this case the notes were never delivered to appellant county, nor to its treasurer, the payee designated in the notes, nor to any one else on its behalf, in trust or otherwise. 5. REPLEVIN 8(3)—CLAIM AND DELIVERYTITLE TO NOTES. Held, that under such circumstances the appellant acquired no right or interest in the notes, nor to the possession thereof, and therefore its action in claim and delivery cannot be maintained. Morgan, J., dissenting. work, at which time the notes, or the pro- Appeal from District Court, Nez Perce tors presented a claim to the county for exCounty; Edgar C. Steele, Judge.. Action in claim and delivery by Lewis County and Luther T. McKee, Treasurer of said County, against the State Bank of Peck. Judgment for defendant, and plaintiffs appeal. Modified and affirmed. Samuel O. Tannahill, of Nez Perce, for appellants. Eugene A. Cox, of Lewiston, for respondent. tra work in the sum of $2,700, which the board allowed; that the contractors arranged for the delivery of the warrant to their bank at Nez Perce and arranged a credit with that bank upon the security thereof; that on the same day the contractors explained the situation to respondent bank; that during the day checks to laborers and materialmen upon the bank at Nez Perce, amounting to $2,082.18, were cashed by respondent and cleared as usual; that afterwards respondent learned that on the 6th day of February, 1915, the county, through its board, had refused to issue the warrant or pay the claim of the contractors; that the after respondent had cashed the checks, * Ringsage, with the consent of the makers of BUDGE, C. J. This is an action in claim and delivery for the possession of certain promissory notes, or the value thereof in case delivery cannot be had. It is alleged in the complaint "that on the 6th day of February, 1915, said plaintiff, the county of Lewis, 1 the notes, delivered them to respondent to sioners rescinded the action of the previous be collected, respondent to be reimbursed out day, rejected Fike & Mitchell's claim for exof the proceeds. The answer contains other tras in the sum of $2,700, and directed the affirmative matter not material here. auditor not to issue the warrant. Upon learning of this action, the bank at Nez Perce refused to. cash the checks which had been honored by respondent bank and they were returned to respondent. On the 9th of February, 1915, Fike & Mitchell gave their note to respondent for $2,400, and Ringsage indorsed all of the subscription notes with the name of McKee by himself, and deposited them as collateral with the note of the contractors to reimburse respondent for the checks cashed on the 5th of February. The trial court found all of the facts substantially as alleged by respondent, and entered judgment accordingly. This appeal is from the judgment. [4, 5] Each separate finding of the court is assigned as error, and the sufficiency of the evidence to support each and every separate finding is attacked. There is no substantial conflict in the evidence, and it supports the findings. It is further specified that: It appears that a petition, signed by certain of the interested residents of the county residing in the vicinity of Peck, was presented to the board of county commissioners, requesting that the Central Ridge grade be built by the county; the commissioners decided to build the road and called for bids; on the 14th of April, 1914, the bids were opened and the bid of Fike & Mitchell accepted. At the meeting of the board Ringsage was present with certain subscription lists which had theretofore been circulated among and signed by various residents and property holders, who agreed to pay certain sums to help in the construction of the proposed road; these lists were not delivered to the county, but were retained by Ringsage, who was advised by the county attorney to take out for circulation an escrow agreement; notes were to be taken from the subscribers and to be placed with the agreement with the bank at Nez Perce; this escrow was never delivered. The contract referred to in the answer was entered into on the 18th day of April, 1914; during that summer, largely through the efforts of Ringsage, certain notes were signed by the various subscribers, made payable on their face to Luther T. McKee, treasurer of Lewis county. These notes were never delivered to McKee, but were retained by Ringsage, who kept them in his private box with the respondent bank. In December, 1914, it became necessary to raise some money to help out the contractors; no more money was available under the terms of the contract at that time from the county, and Ringsage, acting with the knowledge of two members of the board of county commissioners, acting as individuals, gave his personal note to the respondent bank for $800, and, with the consent of the signers of some of the subscription notes, changed the name of the payee therein by scratching out the name of McKee as treasurer, and writing in his own [1, 2] It is the theory of appellant that each name, and these notes were put up by Ring- of these notes constituted a donation sage with respondent bank as collateral to or gift to the county absolutely; that his note. The $800 thus procured was check- they were the property of the county; and ed out by Ringsage from time to time upon that Ringsage, if not previously the county's the order of Fike & Mitchell in payment of agent, became such when the commissioners various debts incurred in the construction accepted the grade, and the arrangement work. On February 5, 1915, the commissionwas made to have the notes deposited with ers accepted the road, and at the same time the respondent bank for collection. There allowed Fike & Mitchell's bill for extras in is no evidence that Ringsage was ever the the sum of $2,700, and ordered a warrant agent of the county. But under the most favdrawn therefor, and it was arranged to have orable view for appellant, if he became its Ringsage turn over the various subscription agent on February 5, 1915, all the facts notes to respondent bank for collection. This and circumstances in evidence conclusively action was reported to respondent bank, show that such relation was created solely which thereupon, and during the same day, for the purpose of delivering to respondent honored the checks of the contractors upon bank the notes held by him as agent of the their bank at Nez Perce as alleged in the makers to be collected for the purpose of answer. On the following day the commis- | reimbursing the county for the $2,700 claim "The evidence is insufficient to sustain the judgment herein, in that it affirmatively shows that the grade was accepted by the board of county commissioners on the 5th day of February, 1915; that the notes then held by S. I. Ringsage became the property of Lewis county; that under the directions of the board of counthe notes with the respondent bank for collec ty commissioners the said Ringsage deposited tion, and the said bank on said 6th day of February, 1915, accepted the said notes for collecsaid Lewis county the relation of principal and tion, thereby establishing between itself and the agent; that no credit was extended to Fike & Mitchell by said bank by reason of the deposit of said notes, and that said notes at the time of deposit and acceptance by said bank were not indorsed; that the said notes were afterwards indorsed by Mr. Ringsage at the request of the respondent bank and the contractors, and by no other person; that the notes were applied by the respondent bank as collateral to the Fike. & Mitchell account on February 9, 1915, three days after the said bank had cashed the checks of the contractors, and that such application was made by respondent bank without the knowledge or consent of Lewis county, or any of its officers." extras, which was on [ notes, and the action should have been disBut on the very next missed. of Fike & Mitchell for board in this respect The cause is remanded, with instructions to modify the judgment in accordance with the views herein expressed, and, as so modified, is affirmed. Costs awarded to respondent. Furthermore, there are at least two fundamental and elementary legal propositions, either of which is sufficient to raise an insurmountable barrier between appellants and the relief which they are seeking, both of which hinge upon the fact expressly found by the trial court and clearly established by the evidence: "That the said notes were never delivered to plaintiff county of Lewis nor to Luther T. McKee, treasurer of said county, nor to any one else on behalf of the said county, nor any of its officers in trust or otherwise." The first proposition is that in order to constitute a gift of personal property "there must be an actual and complete delivery of the property made in execution of the gift, and for the express purpose of consummating it." Bruce v. Squires, 68 Kan. 199, 74 Pac. 1102; In re Slocum's Estate, 83 Wash. 158, 145 Pac. 204; Bliss v. Bliss, 20 Idaho, 467, 119 Pac. 451. And the second is that, independent of the question of any intention to make a gift, no title to a promissory note is shown until it has been delivered. The rule is stated by Bigelow thus: "The contract of the defendant is not complete, and no action upon the instrument can be maintained against him, even by a holder in due course, until he has delivered the instrument. And delivery imports more than handing over to another; it imports such a transfer of the instrument to another as to enable the latter to hold it for himself. If the defendant has only put the paper into the hands of his agent, or of a custodian, to hold accordingly, he has not delivered it any more than if he had passed it from his right hand to his left; he has only enabled the agent or custodian to deliver it." Bigelow, Bills, Notes, and Checks (2d Ed.) p. 13, § 3. [3] The Negotiable Instruments Law (section 3473, Rev. Codes) in this respect provides: "Sec. 3473. Every contract on a negotiable instrument is incomplete and revocable until delivery of the instrument for the purpose of giving effect thereto. * * *"" Samuel O. Tannahill, of Nez Perce, for appellant. Eugene A. Cox, of Lewiston, for respondent. BUDGE, C. J. This is a companion case to Lewis County, State of Idaho, a municipal corporation, and Luther T. McKee, Treasurer of Lewis County, State of Idaho, appellant, v. State Bank of Peck, a corporation, respondent, 170 Pac. 98, the difference between the two cases being that the latter case was an action in claim and delivery to recover certain notes, whereas this case is an action for money had and received to recover the proceeds of certain of the notes which had been collected by the respondent bank. By stipulation both actions were tried as one, all of the evidence was introduced in the other case, and but one record was made. remanded; with instructions to modify the judg- RICE, J., concurs. MORGAN, J., dissents. (31 Idaho, 196) HUDSON v. CARLSON. (Supreme Court of Idaho. Jan. 2, 1918.) 1. CHATTEL MORTGAGES 271-FORECLOSURE -DEMAND UPON MORTGAGOR-STATUTES. Sections 3414 and 3415, Rev. Codes, as amended by Laws 1909, p. 149, relating to the foreclosure of chattel mortgages, do not require the mortgagee to make a demand upon the mortgagor to turn over the property peaceably before placing his affidavit in the hands of the proper officer, if the mortgagor cannot be found within the county where the mortgage is being foreclosed. 2. PRINCIPAL AND AGENT 137(1)-AGENT'S Inasmuch as the notes never were delivered to the county nor to any one on its behalf, it acquired no right or interest therein, nor to the possession thereof, and had no right to such possession at the commencement of its action herein. This being true, that portion of the judgment which provides "that any notes or cash remaining in the pos-is estopped to deny such authority. session of the bank after the payment of the said sum so found to be due by the said bank [be] delivered to the county treasurer of Lewis county" is erroneous. The judgment should have been merely that the plaintiff was not entitled to the possession of the APPARENT AUTHORITY-ESTOPPEL. The authority which a principal holds an agent out as possessing, or which he permits the agent to represent that he possesses, governs mutual rights and liabilities as between the principal and third persons, and the principal 3. BILLS AND NOTES 526-NOTES OF DISHONOR EVIDENCE. Held, that the evidence in this case shows respondent to have complied with the require ments of sections 3561 and 3562, Rev. Codes, relating to notice of dishonor of commercial paper, and proof having been made of the mailing of such notice as prescribed by law, it is imma- | section 3414 of the Revised Codes of Idaho, terial whether or not it was received by the person to whom it was addressed. Morgan, J., dissenting. as amended by 1909 Session Laws, p. 149, provides that before attorney's fees can be recovered in the foreclosure of a chattel Appeal from District Court, Kootenai mortgage, an affidavit signed by the mortgaCounty; R. N. Dunn, Judge. Action by H. M. Hudson against Charles Carlson. Judgment for plaintiff, and defendant appeals. Affirmed. James H. Frazier, of Cœur d'Alene, for appellant. Lynn W. Culp, of Coeur d'Alene, for respondent. BUDGE, C. J. This is an action on certain promissory notes. It is unnecessary to recite the pleadings. Such portions as are material will be referred to in the course of the opinion. gee must be presented to the mortgagor with a demand that the property be turned over or the claim paid"; that an extension of time was granted by respondent to Heumann without the knowledge or consent of appellant, and in this connection that there is no evidence to show that Oscar Nelson, Fred Nelson, or Edith Carlson were agents of appellant or made any arrangement with respondent to grant the extension of time, and that therefore appellant as indorser is released from liability on the notes; and that no notice of demand and nonpayment was given to appellant. Attention has been called to the decision of this court in Tappin v. McCabe, 27 Idaho, 402, 149 Pac. 460, construing section 3413 of the Revised Codes, as amended by Session Laws 1909, p. 149, wherein it was held that: his statutory remedy, if he elects to avail himself of such statutory remedy, wherein it is expressly provided that he is required, under an affidavit, to demand the possession of the chattels covered by the chattel mortgage for the purpose of selling the same to satisfy or apply upon an indebtedness due from the mortgagor, and that he has been unable to secure the possession of said chattels peaceably." It will be readily seen, however, that the latter case is not in point here. Appellant is relying, not upon section 3413, supra, but upon section 3414, and that section, as amended, contains the following proviso: On August 7, 1913, one Heumann made and delivered to appellant 39 promissory notes for $35 each and one for $56, maturing consecutively at the end of each week thereafter, the last note falling due on May 11, 1914. The notes bore interest at the rate of 8 per cent. per annum. To secure the same "An action cannot be maintained against an a chattel mortgage was given on certain officer for his neglect or refusal to take into personal property used in connection with the sonal property under a chattel mortgage, unhis possession, upon an affidavit and notice, perCity Bakery in Coeur d'Alene. Thirty-two less it is alleged in the complaint and proven of the notes were paid, and on or about Sep-upon the trial that the mortgagee has exhausted tember 14, 1914, appellant sold the remaining notes to respondent, indorsing them in blank, and assigned the mortgage. On October 19, 1914, Heumann was adjudged a bankrupt. The bankruptcy court rejected the property described in the mortgage as being fully covered by the same and as not of sufficient value to leave any equity therein in favor of the bankrupt's estate. On December 9, 1914, respondent having made a proper affidavit, notice of sale was given by one Keller, constable for Coeur d'Alene precinct, the sale to take place on December 15, 1914, at which time all of the property which could be found and which possessed any value whatever was sold for the sum of $197, the costs of this sale, in the sum of $10.50, were deducted, and the balance of $186.50 was applied upon the notes. On July 12, 1915, respondent commenced this action against appellant to recover the sum of $154.55, the balance then due upon the notes, including principal and interest, and for $75 attorney fees. A demurrer was interposed to the second amended complaint, which is the one here in issue, and was overruled; whereupon appellant answered. A jury was waived, and the cause was tried by the court, which found the facts in favor of, and entered judgment for, respondent. This appeal is from the judgment. [1] The specifications of error are somewhat lengthy, but it will be unnecessary to consider them in detail. The material points sought to be raised by appellant are that the complaint does not state facts sufficient to constitute a cause of action, and in particular as to attorney fees, "for the reason that "Provided, however, that if the mortgagor cannot be found within the county wherein the mortgage is being foreclosed, the general notice of sale directed in the next section is sufficient service upon the mortgagor of both said affidavit and notice." The next section therein referred to is section 3415, Revised Codes, amended at the same session (page 150) to read as follows: "Sec. 3415. The person or officer having such affidavit must take the property into his possession and give notice of sale in the same manner and for the same length of time as is required in the case of the sale of like property on execution, and the sale must be conducted in the same manner." It is apparent from a reading of these two sections that it was not the intention of the Legislature to require the mortgagee to make a demand upon the mortgagor to turn Over the property peaceably before placing his affidavit in the hands of the proper officer "if the mortgagor cannot be found within the county wherein the mortgage is being foreclosed." Furthermore, Tappin v. McCabe, supra, does not hold that a sale actually conducted by a sheriff or constable in the absence of a demand or an attempt to take possession of the record counsel must have been led afield the property peaceably by the mortgagee would be invalid. The question before this court in the McCabe Case was: Can the sheriff be held liable in damages for his refusal and neglect to foreclose by notice and sale where no demand has been made by the mortgagee, and there has been no attempt by him to take possession of the property peaceably? It was held that under such circumstances the sheriff was not liable. either from a misapprehension of the legal effect of the evidence or of the law with respect to notice of demand and nonpayment. The testimony of respondent is to the effect that, when he learned that Heumann had gone into bankruptcy, he took up the matter of payment of these notes with him, and was advised by Heumann that he could not pay the notes, and that respondent would have to look to his security; further, that respondent wrote appellant on the same day advising him of the foregoing facts and demanding payment of appellant, and further advising appellant that in the event of nonpayment he would exhaust the security by foreclosure and hold appellant for whatever balance might remain unpaid. This letter was deposited in due course of mail, duly stamped, and addressed to appellant, who was then at Vananda, Mont. There is nothing to contradict this evidence in the record, and the trial court committed no error in finding the fact as testified to by respondent. The sections of the Revised Statutes applicable to this situation are: [2] As to the contention that respondent granted Heumann an extension of time with out the knowledge or consent of appellant, it is only necessary to say, and this in answer to appellant's further contention as to want of agency in Edith Carlson, his wife, and Oscar Nelson, his brother-in-law, that under the evidence Edith Carlson was clearly acting as appellant's agent; he had left the notes with her, and she had made repeated efforts to collect them; she called in her brother, Oscar Nelson, to assist her in the transaction at the time that respondent purchased the notes and mortgage. The notes were then long past due, and no other inference is possible than that respondent purchas"Sec. 3561. Where the person giving and the ed the notes in order to help Heumann by giv-es, the notice must be given within the followperson to receive notice reside in different placing him additional time within which to meet ing times: First, if sent by mail, it must be dethe obligation. The notes were sent by Os- posited in the post office in time to go by mail car Nelson to appellant for his indorsement the day following the day of dishonor, or if there be no mail at a convenient hour on that in order that the deal might be closed, and day, the next mail thereafter. * he indorsed them, receiving therefor the full amount of principal and interest then due upon the same. Furthermore, in the light of this evidence, appellant has by an affirmative admission in his answer eliminated this dispute from the case. In paragraph 3 there of he states: "Admits that said Heumann advised and informed said Edith Carlson that said plaintiff would grant an extension of time to said Heumann in which to pay said notes." This was notice to appellant, her principal, and her consent to close the deal knowing this, coupled with the fact that appellant accepted the money and indorsed the notes, is sufficient to bind him. She was unquestionably acting within the apparent scope of her authority, and it is elementary that: "As between the principal and third persons the mutual rights and liabilities are governed by the apparent scope of the agent's authority; which is that authority which the principal holds the agent out as possessing or which he permits the agent to represent that he possesses and which the principal is estopped to deny." 2 C. J. 570. And likewise: "The fact that the agent's apparent authority is different from the actual authority conferred does not relieve the principal of responsibility." 2 C. J. 573. There is, therefore, no merit in appellant's contention that an extension of time was granted without his knowledge or consent. "Sec. 3562. Where notice of dishonor is duly addressed and deposited in the post office, the sender is deemed to have given due notice, notwithstanding any miscarriage in the mails." The language of these sections is so plain that any attempt to elucidate it is uncalled for. Under the evidence respondent clearly complied with the requirements of the statute, and it is immaterial whether appellant ever received the notice or not. This contention of appellant is so lacking in merit as to present no debatable question. A careful examination of the entire record discloses no reason for a reversal. The judgment is affirmed. Costs awarded to respondent. MORGAN, J. (dissenting). The author of the foregoing opinion seems to have proceeded upon the erroneous theory that section 3413, Rev. Codes, as amended, permits a mortgagee to take possession of mortgaged personal property, for the purpose of foreclosure, only in case the mortgagor can be found within the county wherein the mort gage is sought to be foreclosed. The language of the section certainly does not suggest such a construction, nor can it be justified by anything to be found in the other sections referred to. Let us see where the theory upon which the opinion is based will lead us if we follow it: [3] We come now to appellant's contention The provisions quoted from sections 3414 that no notice of demand and nonpayment and 3415, as amended, apply with equal force was given to him. It is not quite clear just to a sheriff or constable as to any other |