Skelly Oil Co. v. Pruitt McCrory , 94 Okla. 232 ( 1923 )

In the trial of this cause the Jury returned a verdict for plaintiffs. The defendant brings error and seeks reversal principally on the ground of insufficiency of the testimony to support the verdict of the jury. The defendant sent B.V. Emory, one of its employes, to Carter county to prepare a lease for the drilling of a well. It appears that the defendant instructed the agent to interview a man by the name of Wallace, who owned a lease in the vicinity of the holdings of the defendant, for the purpose of ascertaining what the lease could be purchased for. According to the testimony of the plaintiffs, Emory enlisted the aid of the plaintiffs, who were real estate agents, to assist him in the negotiations. The plaintiffs testified that the agent called the president of the defendant company over the telephone from their office and stated to the president of the company that the lease could be purchased for $3,000 per acre, and that certain brokers were interested in the sale who would require compensation. The plaintiffs further testified that the agent advised he would allow them, or pay to them, a commission of five per cent. for their services. According to the testimony of the plaintiffs, the sale was finally arranged for $3,000 per acre net, to Wallace, and the defendant completed the purchase for the sum named. On cross-examination the plaintiffs admitted requesting the seller to pay them a commission, who refused, and stated to plaintiffs that he would not sell for less than $3,000 per acre net. Skelly, who was president of the defendant company, testified that Emory was only authorized to ascertain the sum of money the lease could be purchased for and submit the proposition to him. The president of the company further testified that when Emory informed him that brokers were interested in the sale that he advised his agents that he would not pay a commission to any broker, and that he would not pay to exceed $3,000 per acre net for the lease. The witness testified that Emory was not authorized by the defendant to employ brokers, to assist him in the purchase. The defendants in error endeavor to sustain judgment on the following grounds: (a) "That the evidence was sufficient to submit the question of agency to the jury; (b) that the defendant knew of the services performed by the plaintiffs in connection with the purchase, prior to the time the defendant received the conveyance. The only testimony tending to establish the authority of Emory to employ brokers is the evidence of the plaintiffs as to declaration made in their presence by Emory. The agent can only hind the principal when acting within the scope or apparent scope of his authority, and is only authorized to exercise the express or implied powers granted to him by the principal. Howe v. martin,23 Okla. 561, 102 P. 128, 138 A. S. R. 840. The agent binds the principal when acting within the scope of his authority. The scope of the agent's authority is fixed by the express and implied powers given to him by the principal. The implied powers which the agent may exercise are those powers that are necessary or incidental to carry into effect the express powers granted to him by the principal, and the agent's acts within this scope bind the principal. Dispatch Printing Co. v. National Bank of Commerce, 109 Minn. 140, 124 N.W. 236, 50 L.R.A. (N. S.) 74. The plaintiffs failed to prove the granting of express power by the defendant to the agent to employ them in the performance of the services for which recovery in sought. It cannot be said that the power to do so came by implication from the express power granted to the agent to enter into negotiations for the purchase of the lease for the defendant. The plaintiffs failed to prove the granting of express power to Emory, aside from the declarations of the agent. Therefore, plaintiffs' right of recovery to made to rest on the declaration of the agent as to his authority to employ them in the purchase of the lease for his principal.

It will serve no useful purpose to enter into any extended discussion of this matter, as the question has been settled by our court. The declarations of the agent made in the absence of his principal, standing alone, are insufficient to prove the grant of power exercised by him, and to bind his principal to third parties. Iowa Dairy Separation Co. v. Sanders,40 Okla. 656, 140 P. 406; Okla. Automobile Co. v. Benner, 70 Oklahoma,174 P. 567; R. P. Smith Sons Co. v. Raines Dry Goods Co.,37 Okla. 39, 130 P. 133: McDonald v. Strawn 78 Okla. 271,190 P. 558; Thorp Oil Speciality Co. v. Home Oil Ref. Co.,79 Okla. 225, 192 P. 572; James v. Stookey, 13 Fed. Cas. No. 7184; Alabama Fuel Co. v. Rice (Ala.) 65 South, 402.

As the only evidence received by the jury consisted of statements and declarations of the agent, in the absence of his principal, the verdict of the jury rests entirely upon incompetent evidence. There being no competent evidence to support the verdict of the jury, it cannot stand. Tate v. Coalgate State Bank, 72 Oklahoma, 180 P. 687; City of Duncan v. Tidwell, 48 Okla. 382, 150 P. 112; Schafer v. Midland Hotel Co., 69 Okla. 201., 171 P. 337: Sapp v. Hartford F.M. Ins. Co., 86 Okla. 87, 206 P. 814:

For the ratification of the unauthorized acts of the agent, the plaintiffs rely on proof that the defendant had knowledge of the service performed by the plaintiffs at the time it received the conveyance of the oil and gas lease. The fact that the principal or vendee of real estate may have knowledge that a volunteer or stranger has assisted his agent in procuring the purchase, if unauthorized in the first instance, will not bind the principal or vendee, in receiving the conveyance. Williams v. Moore (Tex. Civ. App.)58 S.W. 953; Simms v. St. John (Ark.) 152 S.W. 284; Bouquot et al. v. Awad, 54 Okla. 55, 153 P. 1104; Robinson v. Nipp et al. (Ind.) 50 N.E. 408; Merritt v. Bissell (N.Y.)50 N.E. 280; Carroll v. Tucker, 21 N.Y. Supp. 952.

Therefore it is recommended that this cause be reversed and remanded.

By the Court: It is so ordered.