Baldwin v. Tucker

• Decision Date: 06 December 1901
• Citation: 65 S.W. 841,112 Ky. 282
• Parties: BALDWIN et al. v. TUCKER. [1]
• Court: Kentucky Court of Appeals

65 S.W. 841

112 Ky. 282

BALDWIN et al. v. TUCKER. ^[1]

Court of Appeals of Kentucky.

December 6, 1901

Appeal from circuit court, Mercer county.

"To be officially reported."

Action by D. H. Baldwin & Co. against C. D. Tucker to recover possession of a piano. Judgment for defendant, and plaintiffs appeal. Reversed.

Gaither & Vanarsdale and Simrall & Doolan, for appellants.

Ben Lee Hardin and W. C. Bell, for appellee.

PAYNTER C.J.

On October 7, 1898, D. H. Baldwin & Co., dealers in pianos and musical instruments, by a writing, authorized J. W. Sparks to take orders for their musical instruments in Harrodsburg, Ky and such other territory as might be agreed upon. The instruments and proceeds of sale were to be the property of appellants. The orders taken and sales made by him were not to be binding on appellants until approved by them. Blank notes were furnished to him, payable to appellants' order, and they were to be subject to appellants' approval when executed. On November 22, 1898, appellants shipped to J. W. Sparks, Lawrenceburg, Ky. four pianos, for the purpose of taking orders therefor, according to the terms of the contract of agency. One of the four pianos shipped to him was sold to Charles Sparks, and one of them is the one in contest. On December 22, 1898, he sold the appellee, Tucker a piano for $120, for which he took a note payable to himself individually, 12 months after date, at the First National Bank, Harrodsburg. Upon receipt of the note and delivery of the piano, he discounted the note at the bank, and never accounted to appellants for any part of the proceeds. Four or five days after this transaction, appellee wrote to appellants, at Louisville, Ky. that he had bought the piano Sparks not having made any report of sale to them. The company at once declined to ratify the sale, and claimed the piano. The appellee refused to give it up, and this action was instituted to recover the possession of it, upon the claim that it belonged to them, as they had never parted with title thereto. The appellee resisted recovery, upon the idea that Sparks was acting for appellants, and that they were bound by his acts. Upon the proof as to the contract of agency and the value of the piano, etc., the court, at the conclusion of appellants' testimony, instructed the jury to find for appellee.

It is a difficult question sometimes to determine whether an agency is general or special. It is sometimes held that where an agency is special as between principal and agent it is general between the principal and third persons. Where the agency is created by writing, it seems to be proper for the court to determine whether it is general or special. If it be by parol it is for the jury to determine its character and extent. Mr. Mechem, in his work on Agency, section 6, says "A universal agent is one authorized to transact all of the business of his principal of every kind. A general agent is an agent who is empowered to transact all of the business of his principal of a particular kind or in a particular place. A special agent is one authorized to act only in a specific transaction. A principal can have but one universal agent. He may have a general agent in each line of his business, and in each of several places. He may employ as many special agents as occasion may require. A universal agency is of very rare occurrence, the great majority of the cases being those which involve some form of general or special agency." Sparks seems to have been made the agent, with limited powers, to transact all the business in the matter of selling musical instruments in the city of Harrodsburg and such other territory as might be agreed upon between the parties. Without deciding, we will assume, that he was a general agent for appellants to sell pianos in Harrodsburg. According to the terms of the contract, he had no authority except to solicit orders for pianos. Where an agent is intrusted with goods to sell for his principal, he has no right to sell or deliver them in payment of his own debt. The creditor who receives goods under such an arrangement, notwithstanding he may be acting in good faith and in ignorance that the goods did not belong to the agent, acquires no title thereto against the principal. Where the principal authorizes the agent to collect a demand, or receive payment of one, he cannot be bound by the action of the agent except he actually collect the money. The agent is not authorized to take the note of the debtor, payable to himself or to his principal. Mechem, Ag. § 354, says: "An agent intrusted with goods to sell for his principal has no right to sell or deliver them in payment of his own debt, or to pledge them as security for his own debt, and persons dealing with such an agent are bound to take notice of this limitation of his authority. A creditor therefore, who receives the goods under such an agreement, as well as his vendee, though acting in good faith, and in ignorance that the goods did not belong to the agent, acquires no title thereto, as against the principal." The same author, in section 375, says: "An agent authorized merely to collect a demand, or to receive payment of a debt, cannot bind his principal by any arrangement short of an actual collection and receipt of the money. He cannot, therefore, take in payment the note of the debtor, payable either to himself or to his principal; or the note or bond of himself, or of a third person; or a draft or order on a stranger, or horses, wheat, merchandise, or other property of any kind; nor can he set off a claim due from himself; or take property for his own use in payment." In Grocery Co. v. Becket (Ky.) 57 S.W. 458, the court said: "The general rule is that the acts of an agent bind his principal within the scope of his apparent authority, but that the principal is never bound where the person dealing with the agent knows, or has reason to know, that the agent is exceeding his authority, or is perpetrating a fraud on his principal." In Hoffman v. Insurance Co., 92 U.S. 161, 23 L.Ed. 539, it appeared that an agent of the company agreed to take in payment for the premium a horse for himself and a note to himself. The insurance company refused to recognize the transaction, and in passing upon the question the court said: "The exercise of such a power by the agent was liable to two objections,--it was ultra vires, and it was a fraud as respects the company. Hoffman must have known that neither Goodwin nor Thayer had any authority to enter into such an arrangement, and he was a party to the fraud. No valid contract as to the company could arise from such a transaction." In Bertholf v. Quinlan, 68 Ill. 297, an agent had in his possession whisky for sale. He traded it for a piano. The court held that he had no authority to make such a contract, and that the principal was not bound thereby, and was entitled to recover possession of the whisky, or its value. In Holton v. Smith, 7 N. H. 451, an agent, with general authority to sell his principal's goods did so, and received in payment a debt due from himself to the purchaser. The court held that the principal was entitled to recover the goods. It said: "Miller had an undoubted authority to sell the goods; but it was to sell them, not as his own, but as the goods of the plaintiff; and, acting as agent of the plaintiff, he had no right to exchange them for other goods, or for his own note. By the disposition he made of them he treated them as his own, and this disposition...