Cascade Warehouse Co. v. Dyer

471 P.2d 775 (1970)

CASCADE WAREHOUSE CO., Inc., an Oregon Corporation, Respondent,
v.
Harold A. DYER, Dba H.A. Dyer Lumber Yard, Appellant.

Supreme Court of Oregon.

Argued and Submitted May 6, 1970. Decided July 1, 1970. Rehearing Denied September 11, 1970.

H. William Barlow, Salem, argued the cause for appellant. With him on the brief were Allen, Stortz, Pierson & Barlow, Salem.

Carl N. Byers, Salem, argued the cause for respondent. With him on the brief were James G. Heltzel and Heltzel & Byers, Salem.

Before McALLISTER, P.J., and SLOAN, O'CONNELL, DENECKE, HOLMAN, TONGUE and HOWELL, JJ.

PER CURIAM.

The complaint in this case alleged that plaintiff, a wholesale building material distributor, sold goods to defendant and that payment for the goods was not made. Defendant answered that before any of the sales, alleged in the complaint, had been made that he had sold his business to another and that the goods had been sold to the other person. The reply was a denial. The case was tried to the court without a jury. Plaintiff introduced evidence which was sufficient to prove that he had received no notice of the sale of the business from defendant Dyer; that the business had continued to be operated by the same name and same personnel, and that the sales were made on purchase orders received from the same purchasing agent who had performed these services for Dyer.

At the conclusion of the case defendant moved for a directed verdict. The motion was denied and the court found for plaintiff. The failure to allow the motion is the only assignment of error on this appeal. The assignment claims error because "* * * you can't prove implied or agency by estoppel without pleading it * * *".

It is said to be good pleading to allege that "an act was done by the defendant, and it is competent to prove that averment by showing that the act was really done by an agent of the defendant thereunto duly authorized, or that it was afterward ratified by defendant: * * *." Masters v. Walker, 1918, 89 Or. 526, 529, 174 P. 1164. This rule is almost uniformly followed. 3 Am.Jur.2d 699, Agency § 343. It is also held that as to a third person an agency in existence continues until the third person has notice or knowledge of the termination of the agency. 3 Am.Jur.2d 440, Agency § 34, Stoljar, The Law of Agency, 1961, p. 166; Annotation 43 A.L.R. 1219.

In this case plaintiff did produce evidence sufficient to justify the trial court's finding that prior to defendant's sale of his business that his employee was a "duly authorized" agent to buy from plaintiff and that plaintiff did not receive notice of the termination of the agency until after the sale of goods in question had been made. This was not a case in which plaintiff attempted to prove the creation of any agency relationship by any form of estoppel. Mechem, says:

"So far as third persons are concerned, who can know only that which is open to be learned, they constitute part of the actual authority though commonly included under the description of apparent authority. In other words, so far as third persons are concerned, this apparent authority is included in the real authority. * * *." 1 Mechem, Agency (2d ed. 1914) § 722, p. 511.

In the instant case there was evidence to prove that defendant's former employees continued to act with "real authority."

The real factual dispute presented to the court was whether or not defendant had notified plaintiff of the sale and the consequent termination of the agency. The evidence supports the trial court's finding on the issue.

Affirmed.

McALLISTER, J., concurs in the result.