Empire Implement Manufacturing Co. v. Hench , 219 Pa. 135 ( 1907 )

Opinion by

Mr. Justice Brown,

The first contention of the appellants is, that the appellee was bound to inquire of them as to the authority of Philip Jones to bind them by the contract sued upon. He was admittedly their agent. When they purchased from him his office fixtures, export trade and good will, it was agreed between them that the name of the firm was to be “ Hench, Dromgold & Co., New York City, H. Y., T. Edward Dromgold, Secretary and Treasurer; Philip Jones, Salesman or General Manager.” They took possession of the office that had been occupied by Jones, and the sign put on its door was “ Hench, Dromgold & Co., Philip Jones, Manager.” Their letter heads were as follows: “ Hench, Dromgold & Co., Manufacturers of Agricultural Implements and Machinery for Export. Coffee Exchange Building. Philip Jones, Manager, New York.” The agency of Jones not being questioned, he was a competent witness as to its scope, and he testified that he had express authority to maké the contract. But if he did not have such authority, the jury could fairly have found from the evidence that the defendants, having placed him in charge of their general business at New York as manager or general agent, had held him out to the public as one clothed with authority to make the kind of contract that he made in their name with the appellee; and the jury have found that'he did possess either express or implied authority to bind the appellants, for they were instructed that unless they did so find, there could be no recovery. After telling them that if they should find there was no express authority, the learned trial judge further instructed them : “ If you should conclude that there was no such express authority from the firm of Hench & Dromgold to their manager, or their agent, Jones, to make this kind of a contract then you will look further and determine the second question, whether or not they had placed Mr. Jones in charge of their general business at New York as manager, or general agent, had so held him out to the world and the business community and public as if he were clothed with authority to make this kind of contracts in the ordinary course of the business as conducted by such managers at that time and place.” Without inquiry into the scope of the authority of Jones to act for the appellants, the appellee, of course, took the risk that he was acting- beyond it when he made the contract, but the jury having found, under proper instructions, that ho had acted within his authority, failure of the appellee to make inquiry of the appellants as to its scope is no ground for reversing the judgment.

M. J. Dwyer, called by the plaintiff, testified, under objection, that he was its treasurer, and the second question raised on this appeal is, whether the appellee was not bound to prove by the minutes of its board of directors that he was the treasurer. Dwyer was not called to prove the execution of the contract by him as treasurer. As a matter of fact, he was no party to its execution. His name does not appear in it. It was executed in the name of the appellee by its superintendent, A. Y. Dillenbeck. That Dwyer was the treasurer of the company was a fact very naturally aud properly developed in his preliminary examination. He was not called as the treasurer of the company, but as a witness, to prove what he knew of the circumstances leading up to the execution of the contract. The question as to whether he was treasurer was immaterial on the main issue, and this was the correct view of the trial judge as expressed in his opinion overruling the motion for a new trial.

Tho third and last question raised by the appellants is: “ Does the fact that the plaintiff did not protect its machines by patents in all the countries in which the defendants were to sell the machines until after the date of the expiration of the contract in suit prevent the contract from being binding on the defendants ? ” Nothing appears on the face of the contract about the appellee’s protection of its patents in foreign countries. Before the contract was signed by Jones and delivered to the appellee, he wrote to it on May 3, 1899 : “ We are now satisfied with, your contract and will have same signed. You must, however, protect your rights by patents in Germany, France, Eussia and every country to which we intend sending your machinery.” Five days later he wrote : “ We have not as yet received word from you that your knife grinder has been patented in Europe and other countries. This is absolutely necessary in order to protect us and we would ask that this be done before signing the contract, otherwise the foreigners will beat us.” On the following day the appellee wrote that its attorney was preparing specifications preparatory to applying for patents in England, France, Germany, Canada and certain districts in Australia. To this Jones replied that it was necessary that the appellee get out letters patent in Eussia, Germany, France, England and Australia ; and, finally, on May 19, 1899, in sending the contract signed to the appellee, he wrote: “We now inclose contract signed, it being signed conditionally on your taking out patents in all the countries that we sell your grinders in.”

By the fourth point submitted by the appellants they asked the court to instruct the jury that there could be no recovery because letters patent had not been secured by the appellee in some.of the foreign countries. This wms refused. The court’s reasons for refusing it appear in the opinion overruling the new trial, and are as follows : “ It was for the jury to find all the facts stated in the point, as well as others relating to the subject of the point which are not stated therein, and the court could not, therefore, assume the correctness of this single fact as a sufficient basis for a binding instruction. The mere fact of Jones stating in a letter to the plaintiff, that the contract had been signed on condition that certain patents should be taken out, does not necessarily prove such to have been the fact, especially in the face of the omission from the written contract itself of the entire subject of the procurement of patents. The court could not assume this statement to be true, or that plaintiff had assented to any such thing, as the basis of a binding instruction to the jury. Besides that, if such had been a condition of the contract, the court would have been obliged to submit to the jury the question whether or not the defendant had waived that condition by accepting a part of the goods contracted for, without objection on this ground, and by soon after repudiating the entire contract on a totally different ground. These matters of fact, and the legal inferences to be drawn therefrom, were all necessarily submitted to the jury, and the court had no power to do otherwise under the facts and circumstances of the case.” A sufficient reason why the point should have been refused is that the contract was not repudiated because tbe patents bad not been protected in the countries in which the machines were to be sold. On July 22, 1899 — barely two months from the time it was delivered by Jones to the appellee — and before the latter could reasonably have been expected to have the patents protected in all of the countries named, the appellants repudiated the contract on the sole ground of want of authority in Jones to make it. No complaint was made of the failure to protect the patents, and, when made on the trial, it could have been regarded as but an unavailing afterthought to avoid the agreement.

No one of the assignments can be sustained, and the judgment is affirmed.