
    Shinew v. The First National Bank.
    
      Forged instrument not merely voidable — But absolutely void — Estoppel to deny signature — May apply to one whose name is forged, when.
    
    
      A forged instrument is not merely voidable, but absolutely void, and there can be no ratification of a forgery that will make the instrument valid.
    2. One may by conduct, statements, or silence estop himself from claiming that his signature is a forgery, but before he can be estopped by mere silence, facts must be alleged and proven showing a duty and opportunity to speak, that he knew or had reason to believe, that the holder of the forged instrument would rely on his silence, and that the holder in fact did rely on his silence and was in fact injured thereby.
    (No. 11926
    Decided June 13, 1911.)
    Error to the Circuit Court of Wood county.
    The First National Bank of Bowling Green, Ohio, commenced an action in the common pleas court of Wood county to recover from Annette J. Snyder, J. C. Snyder and George M. Shinew the sum of four hundred dollars and interest thereon, upon a promissory note dated March 5, 1906, and purporting to be signed by the above named persons. A cognovit judgment was taken which was later opened up and George M. Shinew was permitted to file his separate answer in - which he denied that he signed, or authorized any person to sign for him, the promissory note copied in plaintiff’s petition; denied that he executed the note, or authorized any person so to do, and denied that there is anything due from him to the plaintiff. It appears from the record that about the 5th day of March, 1906, Dr. J. C. Snyder, desiring to borrow four hundred dollars from the First National Bank of Bowling Green, Ohio, called upon George M. Shinew and asked him to sign the same. as surety. The testimony of Dr. Snyder offered on the trial of the cause on behalf of the bank is to the effect that Shinew was in the field plowing; that he asked him to sign the note as surety, and Shinew agreed to do so, but not having any pen and ink at hand, he directed the doctor to go to the house .and tell Mrs. Shinew to sign his name for him; that he did as directed by Mr. Shinew, and that Mrs. Shinew did sign the name of George M. Shinew to this note upon his representation to her that her husband desired her to do this. George M. Shinew, in his testimony, denies that he wag -willing to sign this note as surety; denies that he told Dr. Snyder to go to the house and have Mrs. Shinew sign his name thereto,' but on the contrary says that he told Dr. Snyder he would not sign the note, that he had signed as surety once before and lost money thereby, and would not sign again as surety for anyone; that he did not know that his name had been signed by his wife until that night when he was through work, and had gone to his house, at which time his wife told him that the doctor had represented to her that he desired, her to- sign his name to this note. It is also claimed on the part of the bank that George M. Shinew had full knowledge that his name had been signed to said note by his wife before any money was paid upon it; that Shinew recognized the- same and ratified the signing of his name by his wife, affirmed his liability on said promissory note to plaintiff and promised to pay plaintiff the same; that he knew that said note was to he presented to the bank and did not make any attempt to prevent the payment by the bank of the sum named in the note to Snyder, but remained silent and allowed the bank to accept the note and pay the money thereon about four days after the making of the same, and after he had full time, occasion and opportunity in which to notify the bank not to pay any money before it was in fact paid to Snyder and claims that he is now estopped from denying his signature or denying that the same was placed upon said note without his authority.
    Upon the trial of the cause in the common pleas court, the jury returned a general verdict against all of the defendants, including Shinew for the full face of the note with interest, and also answered certain interrogatories as follows:
    “1st. Do you find from the evidence that'the defendant, George Shinew, signed his name to the note sued on in this action? Answer: No.
    “2nd. Do you find from the evidence that the defendant George Shinew authorized any other person to sign his name to the note sued on in this action? Answer: No.”
    George M. Shinew then filed a motion for judgment in his favor on the special findings of the jury, which motion the court overruled. He then filed a motion for a new trial, which the common pleas court also overruled and rendered judgment on the general verdict. Error was prosecuted in the circuit court, and that court affirmed the judgment of the common pleas court, and this proceeding in error is brought to reverse the judgment of the common pleas court and the judgment of the circuit court affirming the .same.
    
      Mr. N. R. Harrington, for plaintiff in error.
    The only question to be presented to the jury was whether the name of the defendant, George M. Shinew, was signed by his authority so that the same was in law his signature. If Mrs. Shinew signed her husband’s name upon the representation made by Doctor Snyder that Mr. Shinew sent word by him directing her to sign his name to the same, and such representation was false, then the signature of George M. Shinew to the note would be as much a forgery as if Doctor Snyder had without authority written the signature himself. Gregory v. State, 26 Ohio St., 510.
    The question of ratification should not have been submitted to the jury. The act was incapable of ratification. There can be no ratification of a forgery. Workman v. Wright, 33 Ohio St., 405; Hood v. Nichols, 1 W. L. B., 186, 7 Dec. R., 157, 1 W. L. B., 227, 7 Dec. R., 174; Insurance Co. v. Hull, 51 Ohio St., 271; Owsley v. Philips, 78 Ky., 517, 39 Am. Rep., 258; Barry v. Kirkland, 6 Ariz., 1, 40 L. R. A., 471; Henry v. Heeb, 114 Ind., 275, 5 Am. St., 613; Shisler v. Vandike, 92 Pa. St., 447, 37 Am. Rep., 702; B. & L. Assn. v. Walton, 181 Pa. St., 201, 59 Am. St., 636; McHugh v. County, 67 Pa. St., 391.
    It would appear that the bank had some suspicion that there was something wrong about it. In any event it was for the bank to make the inquiry before accepting the note and paying the money. There was no duty resting upon Shinew to speak until such inquiry had been made, when if at all, the doctrine of estoppel would arise. Silence in such case would estop the defendant from denying the signature, not because by his silence he ratified the act of a forger, but because through his silence when he was called upon to speak a third person was permitted to suffer. This condition did not exist in this case, hence the court correctly held and so charged the jury that the doctrine of estoppel did not apply. Woodruff v. Montgomery, 30 C. C., 426; McGovern v. Knox, 21 Ohio St., 547; Osborn v. McClelland, 43 Ohio St., 284; Board of Education v. Sinton, 41 Ohio St., 504; McKinzie v. Steele, 18 Ohio St., 38.
    ■ The mere failure of the surety to repudiate his signature and notify the holder did not constitute a ratification. Joyce on Defenses to Comm. Paper, Sec. 74, p. 92; Bank v. Sayre, 85 Cal., 102, 24 Pac. Rep., 713; Corser v. Paul, 41 N. H., 24, 77 Am. Dec., 753.
    Upon the question of Mrs. Shinew’s authority to sign her husband’s name we contend the ratification of one unauthorized act is not the ratification of another separate and distinct act. Hoffmaster v. Black, 78 Ohio St., 1.
    
      Messrs. James & Kelly, for defendant in error.
    . Now, .it may be the law of Ohio that a man may sit idly by and allow his wife to sign his name to a note, knowing that the signing of that signature would secure from a bank the money thereon, and knowing that the fraud was perpetrated, if it be a fraud, before the money was paid, that such a man under such conditions and knowing such facts would have no duty to perform other than to do nothing and to allow the fraud to be so perpetrated, but we do not believe that this is the law of the state of Ohio. Johnson v. Way, 27 Ohio St., 374.
    In this case, as in every other, it is the duty of every person to use ordinary care and prudence in his transactions to prevent their operating to the prejudice of others. McKesson v. Stanberry, 3 Ohio St., 156.
    And we claim that it was the duty of Shinew, under all the circumstances, knowing as he did that Snyder was a crook, and that a fraud had been perpetrated and that the bank would likely suffer from such fraud, to at once or in a reasonable time at least, notify the bank.
    A party who has acquiesced in a fraud as Shinew acquiesced in this fraud cannot set such fraud up as a defense to this note. Harlan v. Read, 3 Ohio, 285; Bank v. Buffinton, 97 Mass., 498; State v. Abramson, 57 Ark., 142; Bank v. Keene, 53 Me., 104; Hefner v. Dawson, 63 Ill., 403; Rudd v. Matthews, 79 Ky., 479; Woodruff v. Munroe, 33 Md., 158; Bank v. Bank, 50 N. Y., 575.
    The bank had no knowledge of any fraudulent transaction between Mrs. Shinew and Dr. Snyder, and if Shinew possessed this knowledge and said nothing he acquiesced and ratified the transaction whereby Snyder secured the money of the bank upon this nóte. Johnson v. Bank, 1 Dayt., 197.
    
      The quietude of Shinew made a consideration for a promise to pay because it became a detriment to the promisee. Workman v. Wright, 33 Ohio St., 405.
    As to ratification see Story on Agency, 253; Livings v. Wiler, 32 Ill., 387; Forbes v. Espy, 21 Ohio St., 474; Sackett v. Kellar, 22 Ohio St., 554; Henry v. Heeb, 114 Ind., 275, 5 Am. St., 613; Williams v. Boyd, 75 Ind., 286.
    We claim that Shinew’s silence, knowing the facts as he did, would be such a ratification and endorsement of the acts that it would bind him. Buckingham v. Smith, 10 Ohio, 288; Castalia Trout Co. v. Sporting Club, 8 O. C. D., 693, 8 C. C., 194, 56 Ohio St., 749; State v. Conser, 24 C. C., 270; Bates v. Binninger, 2 Cin., 568; Quinlan v. Myers, 29 Ohio St., 500; State v. Gibson, 11 Dec., 90, 8 N. P., 367.
   Donahue, J.

The answer of the jury to the second interrogatory submitted to it disposes of the disputed question of fact as to whether or not George M. Shinew directed Dr. Snyder to tell Mrs. Shinew to sign his name to this note. On this question there is a direct conflict of evidence, and therefore, this finding of the jury must be accepted by this court as conclusive of that fact for the purposes of this case as it is now presented. If George M. Shinew did not authorize his wife -to sign this note, then the placing of his name upon the note was a forgery, for it clearly appears that Mrs. Shinew did not place her husband’s name upon the note through any implied authority, or by reason of the fact that she had on previous occasions assumed to sign his name’ to other papers. She was not acting or pretending to act upon any assumption of authority on her part to sign his name because of former transactions, but solely upon the representation made to her by Dr. Snyder that her husband had specifically directed and authorized her to sign this particular paper, and if her husband did not do so, then the signing of his name was a forgery. True, she would not be guilty of forgery because from all that here appears she was acting in good faith aiid relying upon the information imparted to her by Dr. Snyder, but if his representations to her were false then he would be guilty of forgery just the same as if he had used his own hand to write the signature of George M. Shinew. The fact that he procured her to attach the signature of George M. Shinew would make no difference, she was no- more than the instrument by which he accomplished the act of signing George M. Shinew’s name to this note.

This court in the case of Workman v. Wright, 33 Ohio St., 405, held that, “The principle of agency, by which a principal may ratify the unauthorized act of- his agent, does not apply to the alleged ratification of a forged note; the act of the agent being voidable, may be ratified; the act of the forger is void, and can not be ratified.” In that case this court also held that although Wright had promised to pay the note, that the mere promise to pay a forged note without any new consideration,' and' without circumstances creating an estoppel against- the promisor does not become a binding contract creating a liability to pay such note.

In this case the common pleas court charged the jury as follows: “If you find by a preponderance of the evidence that Mrs. Shinew while assuming to act as the agent of Mr. Shinew signed his name to this note, and you find that after the defendant learned that his name had been signed to said note, he ratified the signing of his name by his wife, then the defendant is ■ bound even though he did not authorize the. signing of his name. In order that there may have been a ratification, the defendant at the time of the ratifying the act of his wife, must have known of the facts, relating to the execution of said note and his liability thereon.” This charge is in- direct conflict with the law announced in the case of Workman v. Wright, supra. As already stated there is no foundation for the claim of agency in this case. Mrs. Shinew did not pretend to have any authority to sign her husband’s name as his agent, or to bind him by her; acts as his agent, except the communication made to her by Doctor Snyder that her husband desired her to sign his name to this note, nor1 is it seriously claimed by the plaintiff below that she undertook independent» of this communication to act as her husband’s agent, or to bind him by her contract as his agent; so that the validity of his signature depends entirely on whether Mr. Shinew directed the doctor to tell her to sign his name to this note. If the doctor’s testimony be true, then the transaction was just the same as if the husband had been present and asked the wife to sign his name for him. In such case her act would be his act, and the signature so attached to this note would be his signature and would be valid and binding upon him; therefore, the first question for the jury was whether Shinew did or did not authorize Doctor Snyder to tell his wife to sign his name to this note. If he did not then the signature was a forgery. Forgery being a crime, there could be no ratification of that crime that could operate to change its character. The crime being completed it would forever remain a criminal act, and George M. Shinew could not by any subsequent conduct or admission on his part, ratify a crime that would give validity to an instrument that was absolutely, void at the time of its execution. It is true, however, that, while he might not by any act or conduct on his part ratify a forgery of his name so as to make the instrument a valid instrument, yet he might by his conduct or even by mere silence, estop himself from defending against the payment of the same on the ground that his signature was a forgery, but before he can be estopped by mere silence facts must be alleged and proven showing a duty and opportunity to speak, that the party to be estopped knew, or had reason to believe, that the holder of the note would rely on his silence and that he did rely on -his silence and was injured thereby. Viele v. Judson, 82 N. Y., 32; Wiser v. Lawler, 189 U. S., 260.

' In the third paragraph of the amendment, and supplement- to the petition an attempt is made to' plead an estoppel. It is averred that Shinew had full time, occasion and opportunity in which to-notify the plaintiff not to pay any money thereon. If there were any proof showing that Shinew had “occasion” when it became his duty to speak, when he knew or ought to have known that if he did not speak the bank would rely upon his silence and would be injured thereby, and that it in fact did rely upon his silence and was injured, then this pleading might be held sufficient to have submitted this question of estoppel to the jury, but the proofs do not show any such occasion.

From the evidence it does appear that he had time in which he might have notified the bank of the forgery before the money was paid, but the record does not disclose any opportunity except that there was sufficient time for him to seek such opportunity by voluntarily traveling to the bank, or in some other way communicating with it. The evidence wholly fails to show an occasion to speak, for by “occasion” is meant not only time and opportunity but such conditions and circumstances as required him to-speak, or otherwise be forever estopped from denying his signature. -It is true that a decent regard for the rights of-others ought to induce every man to make such disclosure immediately upon the fact coming to his knowledge." The fact that Shinew did not' immediately communicate with the bank is a. circumstance tending strongly to corroborate the evidence of Dr. Snyder that he had authorized him to tell his wife to sign the note, for the natural and usual" thing for an honest man to do would be to communicate immediately to those most interested, or most likely to be injured thereby, the fraud sought to be perpetrated upon them and this even though it calls for some inconvenience upon his part, and his failure to do so might well reflect upon the credibility of his evidence arid induce a jury to disregard it altogether, or to find against him upon any disputed question of fact. But he is under no legal oblig-ation to do so, unless the circumstances are such that the holder of the forged instrument would have a right to rely upon his silence, and relying thereon would be prejudiced thereby, and the fact that he did not immediately communicate with the bank while it might reflect upon the credibility of his evidence has no further legal significance.

Therefore it was not error for the trial court to instruct the jury not to consider the question of estoppel. This question being entirely out of the case and the jury having found that Shinew did not authorize his signature to this paper, it must have found that he ratified the same, for there could be no other theory upon which a verdict against .Shinew was returned except the theory óf ratification. The trial court should not have submitted this question to. the jury, but should have instructed it that if it found Shinew did not authorize his signature to be placed upon this note that the placing of it there was a forgery and could not be ratified, and for the same reason the motion of the defendant, George M. 'Shinew, for judgment on the special verdict should have been sustained bv the common pleas court, and the circuit court erred in affirming the judgment of the common pleas. For these reasons the judgment of the common pleas court and of the circuit court affirming the same are reversed, and the motion of George M. Shinew for judgment on the special verdict is sustained; plaintiff’s petition is dismissed as to George M. Shinew with costs, and it is ordered that the said George M. Shinew recover from the defendant in error, the First National Bank of Bowling Green, Ohio, his costs expended in the common pleas, circuit court and supreme court taxed at $......, for all of which execution is awarded.

Judgment reversed and judgment for plaintiff in error.

Spear, C. J., Davis, Shauck, Price and Johnson, JJ., concur.  