Whiting v. Wm. H. Crawford Co. , 93 Md. 390 ( 1901 )

The appellant sued the appellee for the price of two carloads of the Michigan Alkali Company soda ash, and at the conclusion of the plaintiff's testimony the Court below instructed the jury that the plaintiff had offered no evidence legally sufficient to show any contract, either express or implied, between the plaintiff and the defendant or to show any contract upon which the plaintiff can maintain the suit in his own name against the defendant. The jury accordingly rendered a verdict for the defendant and the action of the Court in giving that instruction is the only question presented to us for review. The appellant, who is a general merchandise broker in Baltimore, was requested by the appellee to obtain a contract for the sale of from three to six carloads a month of light soda ash for a period of twelve months, beginning in July, 1899, for which it was willing to pay seventy cents per hundred pounds. He communicated with Edward Hill's Son Co., the general agents of the Michigan Alkali Company, which was a large manufacturer of soda ash. On March 24th, 1899, they wrote to the appellant that they would not have the William H. Crawford Company on their books or have anything to do with them whatever, but added, "We will, however, make a contract with you for say three to six cars a month, beginning in July next," and after stating prices, etc., said, "We will allow you 1/2 per cent brokerage on this price. You will therefore see by figuring this out that our offer to you is really 1/2 per cent better than if we sold to you at 67 1/2 cents delivered and allow one per cent brokerage; you can bill Crawford 67 1/2 cents delivered for your account." The offer was accepted by the appellant who, on March 28th, 1899, wrote to the appellee stating, "I have this day sold you for account of the Michigan Alkali Co., Wyandotte, Michigan," and giving in substance the same terms of contract as were included in the letter from the general agents to the appellant, including "terms cash in ten days, less one per cent." That was accepted by the appellee. Nothing further was done and no order given by the defendant until the latter part of September, when it ordered one car of soda ash which was shipped by the Michigan Alkali Company and delivered by the appellant to the appellee in November, 1899, and was paid for by it to the appellant. On November 6th, the appellee gave the appellant an order for six carloads to be shipped by the 8th of December. They were shipped in December and the appellant delivered the first two to the appellee, which it accepted and this suit was brought to recover the price of those two carloads, after demand had been made and refused. On November 18th the appellee wrote to the agents of the Michigan Company, referring to the contract and the order of November 6th, and stating that they had been informed by the appellant that the delivery had been refused. The general agents replied, "We beg to inform you that there is no contract between you and the Michigan Alkali Co., and you have not their accepted contract or ours, who are their agents, and nobody has had authority to sell you goods for account of the Michigan Alkali Co." The plaintiff testified that before the two cars were delivered he showed the letter of March 24th, 1899, to the president of the appellee and that he had paid the general agents for the two carloads. The theory of the defense was that the appellee had made the contract with the Michigan Company through the appellant and therefore they owed him nothing and he could not recover.

Some of the letters offered in evidence indicate that both parties to this proceeding assumed positions towards each other contrary to what they now respectively contend for. On November 27th, 1899, the appellee wrote to the appellant, "We herewith give you notice that we wish (6) six cars of the 58 per cent light Soda Ash delivered in January, 1900, on account of our contract with you of March 28th, 1899," and again on December 1st, it wrote to him "we expect you to carryout your obligations under our existing contract with you." Several other letters are to the same effect and on December 14th, the appellant wrote one to the appellee which is as follows: "Answering your favor of the 13th instant, I can only state that when as your broker, I bought for you the contract for the Michigan Alkali Co., for soda ash, I assumed no responsibility for their acts. Your orders have been promptly forwarded to Messrs. Edward Hill's Son Co., and will no doubt be attended to in conformity with the terms of the contract, which I made for you." If the latter letter was the only evidence of the relations between the appellant and the appellee, it might well be contended that there was no contract between them, but the letters of the appellee are to the effect that it looked to the appellant to carry out the contract. On November 21st, 1899, which was a month or more before it received the two cars involved in this controversy, and indeed before it received the one ordered in September, the appellee had received the letter from Edward Hill's Son Co., which is above set out, and on that date wrote to the appellant quoting that letter and concluded by saying "If the above statement is correct, we will, of course, have to hold you responsible for compliance with the existing contract." The appellant testified that upon its receipt he showed the letter of March 24th, 1899, from Edward Hill's Son Co. to the president of the defendant company, and had not told him of it before because "it was a disagreeable thing to tell him what Edward Hill's Son Co. had said about him." The freight bills for the two cars, which were paid by the appellee, were made out against the appellant.

As the case is presented by the record there was no contract between the appellee and the Alkali Company, as the latter had positively refused to sell to it. The fact that the appellant wrote on March 28th, 1899, that "I have this day sold you for account of the Michigan Alkali Co.," etc., could in no wise bind that company unless he had authority to do so. When the appellee communicated with them Edward Hill's Son Co. promptly informed it that no one had been authorized to make the contract; and then the appellant showed the president the letter of March 24th, 1899, which not only stated that they would not have anything to do with the appellee, but that they would make the contract with the appellant and he could deliver to the appellee for his own account. That was not until after the letter of November 21st, 1899, was received by the appellee from the general agents, but from that time they could not have misunderstood the position of the Alkali Company. What then were the relations between the appellant and the appellee? The appellant in his later correspondence took the position that he had acted for the appellee, and was not responsible to it for defaults of the Alkali Company. In his letter of December 13th, he spoke of his understanding "of the contract made for you with the Michigan Alkali Company" and in that of December 14th, he said "I can only state that when as your broker I bought for you the contract from the Michigan Alkali Co. for soda ash, I assumed no responsibility for their acts." The appellee repeated in several of its letters that it would hold him responsible. If, as the testimony tends to show, the appellant did undertake to sell as agent of the Alkali Company to the appellee, knowing he had no authority to do so, he was responsible to it for such damages as it sustained. When the appellee became aware that the Alkali Company was not the principal, it had the right to sue the appellant. It not only notified him that he would be held responsible, but with full knowledge of the fact that the Alkali Company would not deal with it, it received the two carloads in controversy from him. Upon what principle can it deny liability for them? Is it to be said that when an agent has exceeded his authority in representing his named principal, that the other contracting party can demand of him personally a compliance with the terms of the contract and then refuse to pay for the goods delivered, although he knew that the supposed agent was really acting for himself? There would seem to be but one answer to that question under all principles of justice and fair dealing. Yet that is precisely the inquiry which this record presents, for there was evidence of these facts legally sufficient to be submitted to the jury. The appellee seems to rely on the fact that the original contract was made by the appellant as agent for the Alkali Company, and hence its contract was with that company, and not with the appellant, but it overlooks the effect of its subsequent dealing with him after it had knowledge that he had no authority to bind the Alkali Company. It could have declined to accept the two carloads from him, but it did not pursue that course, and now after accepting them with knowledge that it had no contract with the Alkali Company, it seeks to avoid payment to the appellant on the ground that he had made the contract for that company.

If the relation of principal and agent had existed between the appellant and the Alkali Company and the former had agreed to be responsible to the latter for the goods, as he in fact did, it might well have been contended by the appellant that he could have sued in his own name on the ground that there was a delcredere agency. For it is well-settled that one who takes goods under a del credere commission can, in the absence of active intervention by the real owner, collect the amount due from the purchaser. Miller Co. v. Lea Co., 35 Md. 396. And an agent can sue when he has some beneficial interest in the contract, or special property in the goods, as for his commissions, for example, although he contracted for an avowed principal. 1 Poe, section 312. In this case the facts show that there was no agency, as the Alkali Company had refused to be a party to the contract with the appellee, and hence the above principles cannot apply and therefore the appellant cannot sue,as agent. But when the purchaser ascertains that the supposed agent was not such in reality and demands of him a compliance with the terms of the contract, and the agent buys and pays for the identical goods that the purchaser was to get, and delivers them to him, we can see no reason why the one who originally represented himself to be an agent cannot recover for the goods thus received. The law does not forfeit his right to the price of the goods as a penalty for his misrepresentation. The purchaser gets what he originally contracted for and the only difference is that he gets the goods directly from the supposed agent instead of the principal named. It is true that he has the right to determine for himself with whom he will contract, and as was said in Hand v. Evans MarbleCompany, 88 Md. 226, "the general rule has long been established that ``one who is not a party to a contract cannot be included in the rights and liabilities which the contract creates, so as to enable him to sue or be sued upon it,'" but that rule does not apply to the facts of this case. After the appellee knew he had no contract with the Alkali Company it wrote to the appellant on December 13th, 1899, insisting on delivery of six cars in the month of December, and said "Our contract calls for such deliveryand we expect you to live up to it." And these two cars were a part of the six referred to. And on December, 29th, which was the day after the appellant rendered its bill to the appellee for the two cars the appellee wrote to him "we herewith give you notice that we wish (6) six cars of the 85 per cent light soda ash delivered in February, 1900, on account of our contract with youof March 28th, 1899." It certainly knew it was to pay somebody for them, and, as it knew it was not to pay the Alkali Company the only other person it could pay was the appellant and it treated him as a principal.

What was said in the case of Rayner v. Grote, 15 M W. 359, is peculiarly applicable to the one before us, although that was a suit on an executory contract. The plaintiff had made a contract in writing by which he appeared to be the agent of a party named in the contract, but was in reality the principal himself. A part of the goods, which was also soda ash, had been delivered and accepted and the suit was for the refusal to accept the balance. ALDERSON, B., said "there was evidence given at the trial, tending strongly to show, that when the first parcel of the goods was delivered to and accepted by the defendants, the name of the plaintiff as the principal was then fully known to the defendants; and we think that it was then properly left to the jury to infer from the evidence, that the defendants, with the full knowledge of the facts, had received that portion of the goods, and that all parties then treated the contract as one made with the plaintiff as the principal in the transaction." After referring to cases of executory contracts wholly unperformed, or partly performed without the knowledge of who was the real principal, he said, "But the facts of this case raise a totally different question, as the jury must be taken to have found, under the learned Judge's direction, that this contract had been in part performed, and that part performance accepted by the defendants with full knowledge that the plaintiff was not the agent, but the real principal. If so, we think the plaintiff may, after that, very properly say that they cannot refuse to complete that contract, by receiving the remainder of the goods, and paying the stipulated price for them." See alsoBickerton v. Burrell, 5 Maule and Selwyn, 383; Schmalz v.Avery, 20 L.J.Q.B. 228. In Woodyatt on Agency, 106, it is said "it seems that even though the professing agent names a principal, he will still be exclusively entitled to sue and be liable, if the other party, though knowing who the real principal is, nevertheless partly performs or accepts part performance of the contract."

In this case there was ample evidence to justify the submission of the question to the jury as to whether the defendant had accepted the goods sued for with full knowledge that the plaintiff was the real principal, and if it so found that the plaintiff was entitled to sue. The letter of the appellant of December 14th, 1899, so much relied on by the appellee, was only a part of the evidence to be submitted, and cannot of itself preclude the appellant from suing. The judgment must be reversed.

Judgment reversed and new trial awarded the appellee to paythe costs.

(Decided June 12th, 1901.)