Eastern Advertising Co. v. E. L. Patch Co. , 235 Mass. 580 ( 1920 )

Carroll, J.

The plaintiff seeks to recover on three contracts in writing for the sale' of advertising space in electric cars. The defendant contends that the contracts were not approved by the plaintiff’s president or treasurer, as required by the contracts, and that the defendant was induced to execute them because of an oral promise by the plaintiff’s agent “that although the plaintiff would not insert such a clause [a clause providing for the cancellation of the contract] in writing in the contract the defendant would have the right to cancel such contract at any time it found such car advertising unprofitable, on giving, thirty (30) days’ notice to the plaintiff of such cancellation; ” that such representations were made with the purpose of defrauding the defendant, and that it was not intended by the plaintiff’s agent to carry out these representations.

The written contracts included all the terms of the understanding and were executed in substantial compliance with their requirements. Each contract contained the following provision: “This contract is not binding unless approved by the President or Treasurer of the Eastern Advertising Company.” Two of the contracts were signed “The E. L. Patch Co., by E. L. Patch,” and one by “The E. L. Patch Co. . . . by R. R. Patch,” and they were “Approved Eastern Advertising Co. By Clinton Elliott, Treas.”

Because the contracts were approved in this manner, it cannot be said that they were not approved by the president or treasurer as stipulated in the written agreement. In Clarke v. Fall River, 219 Mass. 580, 583, the contract was executed in the name of the city by the mayor and bore the indorsement of no other city official or board. The defendant’s charter required the approval of the mayor in writing. It was said in the opinion: “It would be sacrificing substance to form to say that, after the mayor had manifested his direct affirmative sanction (McLean v. Mayor of Holyoke, 216 Mass. 62, 65) to every stipulation of the contract by executing it in behalf of the defendant, he must go through the idle ceremony of signing a nominal approval of it.” The principle of that case governs the case at bar. When the contract was executed by the plaintiff in the name of its treasurer, it was approved by him, and the signature “Eastern Advertising Co. By Clinton Elliott, Treas.” was in fact the signature of the company. See Arcade Malleable Iron Co. v. Jenks, 229 Mass. 95, 101.

The defendant offered to show that the plaintiff’s agent made the representations, set out in the defendant’s answer, for the purpose of defrauding the defendant; that he did not intend when they were made to carry them out; and that he used them as a false pretence to induce the defendant to sign the contract. The evidence was excluded. Each contract, under “Terms and Conditions of This Contract,” contained the stipulation, “No verbal conditions made by agents will be recognized. Every condition must be specified on the fact of this contract.” The written contracts contain all the stipulations the parties agreed to, and the paroi promise given when they were executed could not be added to them. Carpenter v. Sugden, 231 Mass. 1. Bennett v. Thomson, ante, 463. The condition requiring that all the terms of the contract must appear on the face of the written instrument, and providing that no verbal agreement of the plaintiff’s agent would be recognized, were stipulations to which the parties agreed and under which they must be held. If the plaintiff’s agent, acting honestly, intending to keep the promise, agreed that the contract could be cancelled by the defendant on thirty days’ notice, it is not shown that he had authority to make such an agreement, see Hale v. Mechanics’ Mutual Fire Ins. Co. 6 Gray, 169; and by the specific terms of the contract such a paroi understanding was of no validity. Even if it were known when the promise was made that it would not be fulfilled and was made for the purpose of deceiving the defendant, the express stipulations of the written contract were to govern, and the plaintiff was not to be held by the paroi representations of the agent. Colonial Development Corp. v. Bragdon, 219 Mass. 170, was an action upon a written contract, one of the terms of which was that no agent of the plaintiff had authority to make any representations not contained in the contract. Evidence was offered tending to show that the defendant was induced to sign the contract by reason of false and fraudulent representations of the agent which, apart from the stipulations preventing him from binding the plaintiff, would invalidate any agreement made in reliance upon them. It was held that the defendant could not rely on the statements of the agent and was bound by the agreement as expressed in the written contract. See International Textbook Co. v. Martin, 221 Mass. 1, 7. In Cannon v. Burrell, 193 Mass. 534, the written contract stated: “Separate verbal or written agreements with salesmen are not binding.” The defendant claimed he was induced to enter into the contract by reason of the false representations of the plaintiff’s agent., The judge ruled that the question was not open to the defendant or material, in view of the written agreement. It was decided that the defendant entered into the agreement on the basis that the salesman had no authority to change the terms of the written contract by any representation or inducement, and that the ruling of the judge in refusing to pass on the claim of the defendant, that he was induced to enter into the contract by reason of the false representation of the salesman, was right.

As the evidence offered by the defendant was inadmissible and the plaintiff must prevail, it becomes unnecessary to consider whether the statements of the agent relating to what might happen in the future were of such a nature that the defendant could rely upon them as fraudulently made, even if no reference were made in the contract to the “ verbal conditions made by agents.” See Knowlton v. Keenan, 146 Mass. 86; Dawe v. Morris, 149 Mass. 188; Friedman v. Pierce, 210 Mass. 419; Brown v. C. A. Pierce & Co. 229 Mass. 44.

Judgment is to be entered for the plaintiff.

So ordered.