Sinclair Refining Co. v. Farmers Bank of Portageville

• Citation: 91 S.W.2d 122,230 Mo.App. 1132
• Parties: SINCLAIR REFINING COMPANY, APPELLANT, v. FARMERS BANK OF PORTAGEVILLE, RESPONDENT
• Decision Date: 03 March 1936
• Court: Missouri Court of Appeals

91 S.W.2d 122

230 Mo.App. 1132

SINCLAIR REFINING COMPANY, APPELLANT, v. FARMERS BANK OF PORTAGEVILLE, RESPONDENT

Court of Appeals of Missouri, Springfield

March 3, 1936

Appeal from the Circuit Court of New Madrid County.--Hon. John E Duncan, Judge.

AFFIRMED.

Judgment affirmed.

Walter E. Brown and Oliver & Oliver for appellant.

It was reversible error for the trial court to permit the defaulter Lumert, to testify, over plaintiff's objection, as to what his duties and his authority were, when such duties were fixed and determined by written contracts and instructions then in evidence. Austin-Western Road Mach. Co. v. Com State Bank, 255 S.W. 585, l. c. 588. "It is a well-established principle of law that an agent authorized to make collections has no implied authority to endorse checks in the name of the principal." Landau Gro. Co. v. Bank of Potosi, 223 Mo.App. 1181, l. c. 1184. "The measure of damages is prima facie the face value of the paper converted. Hence it was error for the court to refuse plaintiff's plain, simple and brief instruction to that effect, to-wit, plaintiff's instruction No. 5." Kansas City Cas. Co. v. Bank, 191 Mo.App. 287, l. c. 290; Carloading & Distr. Co. v. Bank, 224 Mo.App. 876, l. c. 882.

Ward & Reeves for respondent.

"There can be no doubt that an agent can bind his principal by any act that is within his apparent authority." Gilmore Portland Cement Corp. v. M. C. Leinard et al., 223 Mo.App. 169, l. c. 170; Underwood Typewriter Co. v. Realty Co., 165 Mo. 131. "The general rule is that the principal is bound by the acts of his agent when he has placed the agent in such position that persons of ordinary prudence, reasonably conversant with business usages and customs, are thereby led to believe that the agent is possessed of certain authority and to deal with him in reliance on such assumption." Wind v. Bank of Maplewood & Trust Co. (Mo. App.), 58 S.W.2d 332, l. c. 336; Koewing v. Green County Bldg. & Loan Assn., 327 Mo. 680. "An agent is a competent witness to establish his own agency, or it may be implied from the conduct and acquiescence to the principal, or from the course of business between them and their actions in the business community." City of Springfield v. Koch (Mo. App.), 72 S.W.2d 191, l. c. 194; Haubelt Bros. v. Mill Co., 77 Mo.App. 672; Johnson v. Hurley, 115 Mo. 513.

SMITH, J. Allen, P. J., and Bailey, J., concur.

OPINION

SMITH, J.

--This is an action at law begun by the plaintiff against the defendant, in April, 1934, wherein the plaintiff, seeks to recover $ 672.43, being the amount of nine checks. Eight of these were issued by the Service Oil Company on the Bank of Caruthersville, and one by Walker and Sons on the Farmers Bank, in all of these checks the Sinclair Refining Company was the payee, and which were cashed by the Farmers Bank of Portageville, the defendant herein, for A. E. Lumert, who endorsed all the checks by writing the plaintiff's name thereon.

The plaintiff's petition is in two counts, the first of which charges the defendant with the conversion of said checks, and the second count charges that the defendant was the trustee for the plaintiff of the checks in question amounting to $ 672.43. The answer admitted the corporate existence of the plaintiff, the cashing of the checks in question, but denied the defendant converted the checks to its own use and benefit or that it was the trustee for the benefit of the plaintiff in the handling of said checks and further answering alleged that the checks in question were cashed by A. E. Lumert, the duly appointed agent and representative of the plaintiff in the Portageville territory, and charges that the said Lumert had authority to cash said checks inasmuch as he was responsible to the plaintiff for all collections, and that the checks in question were received by Lumert as collections; that the said Lumert was required by the plaintiff to forward to them post office money orders, and that the checks were cashed by Lumert, deposited with the defendant and were checked out later for the purpose of securing such money orders; that plaintiff was familiar and had full knowledge that Lumert was cashing said checks as agent to get post office money orders; that defendant had reason to believe that Lumert was duly authorized to so act and endorse said checks; that all money deposited by Lumert was checked out by him without any remuneration to the defendant; that Lumert was personally responsible for said checks and had made bond to protect plaintiff against any loss by any mismanagement or misappropriation of said funds; that this defendant was no party to the failure of Lumert to report any such collections.

The cause was tried on the 15th day of May, 1934, at the regular May term of the Circuit Court of New Madrid County, and at the close of plaintiff's case defendant demurred to the testimony which was overruled. Again at the close of the whole case the defendant offered demurrers "A" and "B" to the first and second counts respectively of the plaintiff's petition, which demurrers were overruled. The defendant at the close of the whole case after the overruling of the defendant's demurrers, moved the court to require plaintiff to elect upon which count it would go to the jury in this case, which was overruled by the court. The case was submitted to the jury. Plaintiff offered four instructions, which were given by the court just as offered and the court refused a fifth one for the plaintiff. The court gave two instructions for the defendant. The jury returned a verdict for the defendant. The trial court rendered judgment for the defendant and overruled plaintiff's motion for a new trial. Plaintiff accordingly appealed to this court.

We shall consider the several assignments presented, with the facts of the case as shown by the record before us.

The second, third and seventh of these assignments may be considered together. These assignments are as follows:

"II.

"The court erred in refusing to find and hold that under the law and the evidence plaintiff was entitled to a verdict and judgment in this case.

"III.

"The court erred in failing to observe that all of the sums sued for as represented by Exhibits 1 to 8, both inclusive, and totaling $ 510.41, were drawn upon a bank other than the defendant bank and that as to those funds defendant bank was an intervening or intermeddling bank as defined by the courts of this State, and that as to said sum plaintiff was entitled to a directed verdict."

"VII.

"The verdict is obviously the result of prejudice and passion, fanned to a flame by defendant's method of conducting the trial."

It may be readily seen that the above assignments are directed at the alleged error of the trial court in not directing a verdict for the plaintiff. This of necessity requires an examination of the testimony in the most favorable light to the defendant.

The evidence is uncontroverted that the defendant cashed the nine checks in question. Eight of these checks were upon a bank other than the defendant bank. The ninth was on the defendant bank. Lumert endorsed the checks by writing the name of his employer, the plaintiff in this case, on the back of each check, and either cashed them at the time or deposited them in the defendant bank in his own name and checked the money out later.

The record shows that the plaintiff is an out-state corporation, being incorporated in the State of Maine, and that it had numerous agents in Missouri and throughout the middle west, and that practically all of its business was transacted through the local agents. The record shows that these local agents were required to make application for a bond to protect the plaintiff against such transactions as occurred in this case, and that A. E. Lumert applied for such a bond when he was employed. The record also shows that Lumert entered into a written contract with the plaintiff and this contract, which was introduced in evidence, covered and restricted Lumert's conduct and dealings with the plaintiff, and as between the plaintiff and Lumert there can be no question but that the written contract was binding. But the written contract is not necessarily binding on the defendant bank, for there is no evidence, that the bank or any of its officers had any knowledge of the existence of any written contract between the plaintiff and Lumert. We shall have more to say about this written contract later.

The evidence discloses that Lumert was given a specific territory in and around Portageville in which to sell the products of the plaintiff and he was required to and did collect for the same, and that he was required to report said sales and collections to the plaintiff two or three times a week. It is also disclosed by the evidence that at the time Lumert was employed by the plaintiff, a representative of the plaintiff called upon the cashier of the bank and told him that A. E. Lumert had been employed by the plaintiff and that any favors shown Lumert would be appreciated, and in that conversation there was no instructions given the bank as to how the checks given the company should be handled.

The evidence shows that from the time of Lumert's employment in June, 1931 until he was removed in September, 1932, he had an account with the bank and repeatedly from the time of his employment endorsed the checks made payable to the plaintiff and either cashed them or deposited them to his own account and frequently for the first six months remitted by draft to the plaintiff. In December, 1931 a letter was written to Lumert by a representative of the plaintiff advising him to discontinue sending drafts to cover his collections. There is no evidence that the bank officials had any knowledge of...