183 U.S. 642 (1902), 49, Sun Printing and Publishing Association v. Moore

Docket Nº:No. 49
Citation:183 U.S. 642, 22 S.Ct. 240, 46 L.Ed. 366
Party Name:Sun Printing and Publishing Association v. Moore
Case Date:January 13, 1902
Court:United States Supreme Court

Page 642

183 U.S. 642 (1902)

22 S.Ct. 240, 46 L.Ed. 366

Sun Printing and Publishing Association



No. 49

United States Supreme Court

January 13, 1902

Argued October 24, 1901




The trustees of The Sun Association are to be charged with knowledge of the extent of the power usually exerted by its managing editor, and must be held to have acquiesced in the possession by him of such authority, even though they had not expressly delegated it to him, and he is held to have been vested with such power.

An authority to charter a yacht for the purpose of collecting news was clearly within the corporate powers of the association.

It is impossible to assume in this case that the relation of The Sun Association to the hiring of the yacht was simply that of a security for Lord as a hirer of the yacht on his personal account, and the two papers in evidence are in legal effect but one contract, and must be interpreted together.

As the trustees of The Sun Association must be presumed to have exercised a supervision over the business of the corporation, they are to be charged

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with knowledge of the extent of the power usually exercised by its managing editor.

The fixing of the value of the vessel in the contract can have but one meaning -- that the value agreed on was to be paid in case of default in returning.

The decision of the court below that the sum due in consequence of a default in the return of the ship was not to be diminished by the amount of the hire which had been paid at the inception of the contract was correct.

The naming of a stipulated sum to be paid for the nonperformance of a covenant, is conclusive upon the parties in the absence of fraud or mutual mistake.

Parties may, in a case where the damages are of an uncertain nature, estimate and agree upon the measure of damages which may be sustained from the breach of an agreement.

The law does not limit an owner of property from affixing his own estimate of its value upon a sale thereof.

As the stipulation for value in this case was binding upon the parties, the court rightly refused to consider evidence tending to show that the admitted value was excessive.

The yacht Kanapaha, the property of the respondent Moore, was let on April 1, 1898, for the term of two months, by a charter party in which Chester S. Lord was recited to be the hirer, but which was signed by him as follows: "Chester S. Lord, for The Sun Printing & Publishing Association." At the time, Mr. Lord was, and for many years prior thereto had been, the managing editor of the Sun newspaper, and had special charge of the collection of news for the Sun Printing & Publishing Association, the publisher of the newspaper aforesaid. We shall hereafter speak of this corporation as the Sun Association, and of the newspaper as the Sun.

In the body of the charter party. the hirer agreed to furnish security, and contemporaneously with the execution of the contract, a paper was signed which is described in the body thereof as the "understanding or agreement of suretyship" required by the charter party. This paper recited on its face that it was made by "the Sun Printing & Publishing Association," and it also was signed by Lord exactly as he had signed the charter party. Before the time fixed in the charter party had expired -- that is to say, about the middle of May, 1898 -- a second charter party and a second agreement of suretyship were executed.

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These agreements were substantially identical with the previous ones, except they provided for a new term to begin at the expiration of the previous one and to continue for four months thereafter, that is, up to October 1, 1898.

On the execution of the first papers, the yacht was delivered to the Sun Association, was by it immediately manned, equipped, and provisioned, and one or more of its reporters were placed on board with authority to direct the movements of the vessel, and she was sent to Cuban waters, to be used as a dispatch boat for the purpose of gathering news concerning the events connected with the hostilities between the United States and Spain.

Early in September, 1898, the yacht was wrecked, and became a total loss. For a breach of an alleged covenant to return the vessel, asserted to be contained in the charter party, this libel in personam was filed against the Sun Association, and the damages were averred to be the value of the vessel, which it was alleged was fixed by the charter party at the sum of $75,000. The district court held that the writings were contracts of the Sun Association through Lord, its authorized agent, and were virtually one agreement; that by them, that corporation was responsible for the nonreturn of the ship, whether or not the vessel had been lost by the fault of its agents or employees, and that there was a liability to pay the value of the vessel as fixed by the charter. Construing the two writings as a whole, this value, it was held, was subject to be diminished by the extent of the charter hire, paid when the charter party was executed. A judgment was entered for the sum of $65,000, with interests and costs. 95 F. 485. On appeal, the circuit court of appeals coincided with the district court, except it disapproved the conclusion that the value of the vessel should be reduced by the sum of the charter hire. The decree of the district court was reversed, and the cause remanded with instructions to enter a decree for $75,000, with interest and costs. 101 F. 591. The case was then brought here by certiorari.

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WHITE, J., lead opinion

[22 S.Ct. 242] MR. JUSTICE WHITE, after making the foregoing statement, delivered the opinion of the Court.

All the issues involved are to be determined by ascertaining the nature of the writings, the obligations which arose from their execution, and the conduct of the parties in connection therewith. It is essential, then, to bear in mind the exact form of the writings and their text. They are annexed in the margin.1

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It would seem to be necessary on the threshold to ascertain whether there was both a principal contract and an accessory contract of suretyship. The two writings are both signed by

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Lord in exactly the same character. Judging by the signatures alone, it is impossible to conceive of two contracts, the one principal and the other accessory thereto, as, in the nature of things, if the first evidenced the obligations of the one who hired and the second manifested the agreement of the same person to fulfill his own duty resulting from the hiring, there could be no accessory contract of suretyship, since both documents but expressed [22 S.Ct. 243] pressed the covenants of the same person relating to one and the same transaction. There is, however, this difference between the two papers. In the body of the first, "Chester S. Lord" is recited to be the hirer, while in the body of the second paper, it is recited that it is made by the Sun Printing & Publishing Association.

The first question to be determined is, assuming for the present that Lord had authority to bind the Sun Association, was the first document the individual contract of Lord or that of the Sun Association?

The rule of law to be applied in the determination of this question is thus expressed in Whitney v. Wyman, (1879) 101 U.S. 392, 395:

Where the question of agency in making a contract arises, there is a broad line of distinction between instruments under seal and stipulations in writing not under seal, or by parol. In the former case, the contract must be in the name of the principal, must be under seal, and must purport to be his deed, and not the deed of the agent covenanting for him. Stanton v. Camp, 4 Barb. 274.

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In the latter cases the question is always one of intent, and the court, being untrammeled by any other consideration, is bound to give it effect. As the meaning of the lawmaker is the law, so the meaning of the contracting parties is the agreement. Words are merely the symbols they employ to manifest their purpose that it may be carried into execution. If the contract be unsealed and the meaning clear, it matters not how it is phrased nor how it is signed, whether by the agent for the principal or with the name of the principal by the agent, or otherwise.

The intent developed is alone material, and when that is ascertained it is conclusive. 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.

Now while Lord is referred to in the body of the first writing as an individual, he signed the agreement "for the Sun Printing & Publishing Association." Clearly this was a disclosure of the principal, and an apt manner of expressing an intent to bind such principal. Bradstreet v. Baker, 14 R.I. 546, 549; Tucker Manufacturing Company v. Fairbanks, 98 Mass. 105.

It results that the first paper or charter party manifested the intent to bind the Sun Association as hirer, if Lord possessed the authority which he assumed to exercise, and consequently that the two papers are in legal effect but one contract, must be interpreted together, and the obligations of the parties arising from them be enforced according to their plain import, seeking always to give effect to the intention of the parties.

It is not denied that Lord was, in some respects, the agent of the corporation, but it is asserted that he had not the power or authority to make a contract of the character here involved. The charter of the Sun Association provided for no other officers to manage its concerns but a board of trustees. In the bylaws, provision was...

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