Schwartz v. United Merchants & Manufacturers, Inc. ( 1934 )

MANTON, Circuit Judge

(dissenting).

On the statement of facts recited in Judge IIAND’S opinion, a jury question was presonted as to -whether a. contract was made and whether or 110 there was a breach of such contract. Such a contract, made as stated, presumptively had the authority of its make or, the corporation appellee. Hotel Woodward Co. v. Ford Motor Co., 258 F. 322 (C. C. A. 2); Hastings v. Brooklyn Life Ins. Co., 138 N. Y. 473, 479, 34 N. E. 289. When the case of Hotel Woodward v. Ford was before us on the second appeal (271 F. 625, 629) we said:

_ Hns brings us to the question of Bollertson’s authority to sign the letter of Au- , , lr>1„ Ur 1 -j-i ii • gust 31, 191S. Klingelsmith, the vico president, after a conversation with Green on the subject, sent him up to Robertson’s office on the same day with the draft lease ‘to fix the matter up.’ At least so Green testified; Klingelsmith merely saying that he had referred the matter to Robertson. Klingclsmith had certainly charge of the whole ne- ,, tt i , ,, -, , gotiation, and Henry Ford, the president, and Edsell Ford, the secretary, were also conversant with it. This established a prima facie authority in the managing officers to authorize Robertson to do what he did.”

The facts there are very much like those at bar. There was nothing ultra vires in the action of the appellee in making the contract, The contract warranted that the agreement had been approved by the directors of the Ashland Corporation and that its president was authorized to make such a contract. The contract was beneficial to the appellee corporation and was made by the president within the apparent scope of his authority. Union Indemnity Co. v. Home Trust Co., 64 F.(2d) 906 (C. C. A. 8); Bijur Motor Lighting Co. v. Eclipse Machinery Co., 243 F. 600 (C. C. A. 2). If the jury found the contract existed and was breached, there should be a recovery.

I dissent.