All Florida Sur. Co. v. Coker

• Citation: 88 So.2d 508
• Parties: ALL FLORIDA SURETY COMPANY, a Florida corporation, Appellant, v. Ralph H. COKER, d/b/a Coker Plumbing, Appellee. ALL FLORIDA SURETY COMPANY, a Florida corporation, Appellant, v. Olin P. WRIGHT, Appellee.
• Decision Date: 20 June 1956
• Court: United States State Supreme Court of Florida

Page 508

88 So.2d 508

ALL FLORIDA SURETY COMPANY, a Florida corporation, Appellant, v. Ralph H. COKER, d/b/a Coker Plumbing, Appellee.

ALL FLORIDA SURETY COMPANY, a Florida corporation, Appellant, v. Olin P. WRIGHT, Appellee.

Supreme Court of Florida, En Banc.

June 20, 1956.

Rehearing Denied July 17, 1956.

Henry L. Balaban and Thomas A. Horkan, Jr., Miami, for appellant.

Ruff & Ready, Miami, for Ralph H. Coker and Turner & Hodson, Homestead, for Olin P. Wright, appellees.

ANDERSON, Associate Justice.

H. O. Barber was awarded a contract by the Orange State Oil Company for the construction of a filling station at Oslamorado, Florida. He sublet the plumbing work to Ralph H. Coker and the electrical work to Olin P. Wright. He applied to All Florida Surety Company for a performance bond to insure the fulfillment of the contract. His application was rejected because of his unstable financial condition. The agent of the surety company suggested that he secure others to become co-indemnitors upon his application for the bond. Barber said that his subcontractors would be agreeable to assuming that obligation. The agent, after learning the names of the subcontractors, looked them up in Dun & Bradstreet and informed Barber that they were 'bondable.' He thereupon prepared application for bonds for Coker and Wright and indemnity agreements for them to sign, marked the places for their signatures with a red pencil and gave them to Barber with directions to get the signatures of Coker and Wright to the papers prepared by him and get financial statements from both.

Barber took the papers prepared by the agent of the surety company to Coker and Wright and procured their signatures upon the application for bonds and the indemnity agreements. He also got financial statements from them. These he delivered to the surety company who thereupon signed the performance bond on behalf of the surety company. The agent of the surety company had no dealings with Coker or Wright other than as above set forth.

Barber defaulted on his contract. The surety company completed it at a cost of approximately $6,000. It then called on Coker and Wright for reimbursement under their indemnity agreement. They refused and it brought suit.

Coker and Wright thereupon brought these identical suits in equity for a rescission of the indemnity agreements upon the ground that they had been falsely represented to them by Barber, as agent of the surety company, and that they had neglected to read them when presented for their signature. The special master found that '* * * Barber falsely represented to Coker and Wright that the instruments he was requesting them to sign were those required in order that they, as sub-contractors, could be bonded' and they 'relied on Barber's representations as to the nature of the instruments, and that they signed without reading' them and 'that there was such a confidential relationship existing between Barber and Coker and Wright * * * it is doubtful if they would have understood them [the documents] on account of their lack of experience and education * * *' (Emphasis added.)

The Chancellor sustained the master's recommendation that the documents be rescinded and that the surety company's counterclaim for their enforcement be dismissed as to Coker and Wright.

The surety company appealed.

The decree must be reversed. There is no evidence that Barber, assuming that he did the things with which he is charged, was acting for the surety company. Coker and Wright both knew what his status in the transaction was and what his relationship to them was. They knew that he was not the agent of the surety company. As above pointed out, the agent or the surety company never had any contacts with Coker and Wright. There is a total absence of proof that the agent of the surety company had anything whatsoever to do with the conduct of Barber in procuring the signatures of Coker and Wright to the indemnity agreements. Even if there were it would be doubtful if he was authorized to bind the surety company in that respect.

In People v. Rogers, 104 Fla. 462, 140 So. 205, 208, relied on by appellees, it was expressly said: '* * * if the opposite party has induced one by a trickery, fraud, or any kind of artifice, not to read the contract, with the view of obtaining from him a paper which he could not otherwise have obtained, the right to prove these circumstances, and thereby establish the fact that he was signing an entirely different paper, may be shown for the purpose of relieving such party from the obligation thus fraudulently obtained.' (Emphasis added.) There is no proof that this alleged deception was practiced on Coker and Wright 'by the opposite party.' There is no proof that Barber, in his alleged deception of Coker and Wright, represented the 'opposite party.'...