Hall v. Encyclopaedia Britannica, Inc.

Plaintiff entered into a written agreement whereunder he was appointed agent of the defendant corporation to sell books on a commission basis. The contract contained the following provision:

"This contract shall not be modified or changed by any verbal promise or statement by whomsoever made and no such promise or statement shall be binding upon the company until the same shall have been approved in writing by the company."

Plaintiff says that thereafter defendant Guido, as division sales manager of the corporation, made an oral agreement with him on behalf of the corporation whereby the latter undertook to do certain things, not mentioned in the written contract, to aid plaintiff in the sale of books, but that the corporation failed to perform accordingly.

Plaintiff did not show that Guido had actual authority from the corporation to make the oral agreement and defendants deny it. Plaintiff, however, relies upon language quoted with approval inGrinnell v. Carbide Carbon Chemicals Corp., 282 Mich. 509,525, as follows:

"It is elementary that persons dealing with an agent may rely on his apparent authority (Marx v. King, 162 Mich. 258), and that such authority is to be gathered from all of the facts and circumstances properly admitted in evidence."

Aside from the fact that Guido was one of defendant corporation's division sales managers there is no evidence in the record to support a finding of apparent authority on his part to so bind the corporation. The quoted provision of the contract constitutes a fact or circumstance negativing any idea of such apparent authority.

"`If there is anything likely to put a reasonable business man upon his guard as to the authority of the agent, it is the duty of the third party to inquire how far the agent's acts are in pursuance of the principal's limitation.'" Humphrey v.Onaway-Alpena Telephone Co., 204 Mich. 97, 109.

Plaintiff made no such inquiry. There is no evidence that the corporation, prior to the termination of plaintiff's employment with it, accepted any benefits under the alleged oral agreement or in any other way ratified it.

Plaintiff's declaration does not allege nor did he show that Guido was personally bound to do anything under the alleged oral agreement.

"Where the principal is disclosed, and the agent is known to be acting as such, the latter cannot be made personally liable unless he agreed to be so." Whitney v. Wyman, 101 U.S. 392 (25 L ed 1050).

Plaintiff had neither an established business or market for the sale of defendants' books, nor a demonstrated record of previous sales from which a determination of possible future sales might have been made with reasonable certainty. The court properly having rejected offers of proofs of plaintiff's merely speculative estimates as to what commissions he might have earned had he received the aid from the corporation to which he claims he was entitled (Isbell v. Anderson Carriage Co., 170 Mich. 304), and of what he later earned as salesman for another book selling concern (Dowagiac Manufacturing Co. v. Corbit,127 Mich. 473), as well as of shock and anguish suffered by him as a result of the corporation's failure to perform (15 Am Jur, Damages, § 182), plaintiff was left with no proof of any damages whatsoever.

The directed verdict for defendants of no cause for action is affirmed, with costs to defendants.

SHARPE, C.J., and BUSHNELL, BOYLES, REID, NORTH, BUTZEL, and CARR, JJ., concurred.