Bennett v. Potashnick

• Decision Date: 07 January 1924
• Docket Number: No. 3429.,3429.
• Citation: 214 Mo. App. 507,257 S.W. 836
• Parties: BENNETT et al. v. POTASHNICK.
• Court: Missouri Court of Appeals

257 S.W. 836

214 Mo. App. 507

BENNETT et al. v. POTASHNICK.

No. 3429.

Springfield Court of Appeals. Missouri.

January 7, 1924.

Appeal from Circuit Court, Scott County; Prank Kelley, Judge.

Action by James E. Bennett and others, a copartnership, under the firm name of James E. Bennett & Co., against Sam Potashnick. Judgment for defendant, and plaintiffs appeal. Reversed and remanded.

Harry C. Blanton, of Sikeston, for appellants.

R. E. Bailey, of Sikeston, for respondent.

BRADLEY, J.

Plaintiffs, a copartnership, operating under the firm name of Jas. E. Bennett & Co., sued on a $1,200 check drawn by defendant's son. The court directed a verdict for defendant, and plaintiffs appealed.

The petition is in two counts: The first on the theory that the son signed defendant's name as his agent; and the second on the theory that defendant is estopped to deny the son's agency. The answer put in issue the two theories. The facts are as follows: Defendant lived at Sikeston in Scott county. The son, 19 years old at the time, went to Cairo, III. and tried his luck on the board of trade; plaintiffs handling his account. On May 5, 1921, the son deposited with plaintiffs $100, and on May 10th thereafter deposited another $100. These two deposits or payments were made by checks drawn by the son, payable to plaintiffs, and drawn on the Bank of Sikeston, and signed "Sam Potashnick, By R. B. Potashnick." The son testified that the first deposit or payment he made was cash, but plaintiffs' evidence tends to show it was by check the same as the second, and for the purposes of the statement, a directed verdict, having been returned, we will assume that the two deposits were made by check, as plaintiffs' evidence tends to show. These two checks in due course reached the Bank of Sikeston and were paid by defendant. On May 25, 1921, the cheek sued on was drawn by the son, payable to Albert Lee, who at the time was employed by plaintiffs, and indorsed by Lee and delivered to plaintiffs. This check was signed the same as the other two—"Sara Potashnick, By R. B. Potashnick." When this check reached the Bank of Sikeston, payment was refused. It also appears that the son, on May 14th, drew a $75 check payable to a hotel in Cairo, and that it was signed the same as the others, and that defendant paid the hotel check. Lee testified that defendant in Sikeston told him that he had had trouble before on account of his son signing his (defendant's) name to checks and that he did not then have the ready cash to pay this check, but that he would pay it.

The foregoing is the evidence presented by plaintiffs to show agency and estoppel. Defendant and the son both testified, that the son had no authority to use defendant's name in any manner whatsoever in relation to drawing checks, and defendant explained that he paid the other checks because he owed his son.

The trial court directed a verdict in favor of defendant on the first count, on the ground that no substantial evidence had been offered tending to establish agency, and an the second count on the ground that the petition on this count failed to state sufficient facts to constitute a cause of action.

The signature of a party to a negotiable instrument, such as the check sued on, may be made by a duly authorized agent. Section 806, R. S. 1919. Defendant does not contend otherwise, but he says that there is no substantial evidence tending to show that his son was authorized to sign this check. In the case before us the alleged agent signed defendant's name for the benefit of the alleged agent. The only evidence offered tending to establish agency was the three checks, one of which plaintiff had no knowledge. Plaintiff contends that these constituted some evidence tending to establish agency, and that the court should not have directed a verdict on the ground that there was no substantial evidence tending to establish agency. These three checks having been drawn as stated, .and having been paid by defendant, plaintiffs contend, tends to prove the course of dealing on the part of the alleged agent, which course of dealing defendant recognized and approved. Defendant challenged the competency of the hotel cheek on the ground that plaintiffs, when they received the check sued on, had no knowledge of the hotel cheek, and the trial court excluded this evidence. This check was competent for what it was worth in Plaintiffs' chain of circumstances on the theory of implied agency, whether they knew about it at the time or not. Sharp v. Knox, 48 Mo. App. 169. Such evidence is competent on the theory that it tends to show the course of dealing on the part of the alleged agent, which has been sanctioned or ratified by the alleged principal. Do these facts constitute any substantial evidence of agency? The authority of the son to sign the checks as they were signed could be established like agency in any other case. Bank v. Hahn, 146 Mo. App. 699, 125 S. W. 539. In Sharp v. Knox, supra, the court quotes with approval Mechem on Agency as follows:

"Where it appears the alleged agent has repeatedly performed acts like the one in question which the principal has ratified and adopted, his authority for the performance of the disputed act may be inferred."

We might say here that defendant's promise to pay this check, if made, should be considered along with the other facts and circumstances tending to show that the son had authority in the first instance to sign defendant's name.

The general rule is laid down in 2 C. J. § 37, p. 441, that agency may be implied from prior habits or course of dealing between the parties. In support of this rule the following Missouri cases are cited: Summerville v. Railroad, 62 Mo. 301; Brooks v. Jameson, 55 Mo. 505; Franklin v. Ins. Co., 52 Mo. 461; Phillips v. Mfg. Co., 129 Mo. App. 396, 107 S. W. 471; Bonner v. Lisenby, 86 Mo. App. 663; Haubelt Bros. v. Rea & Page Mill Co., 77 Mo. App. 672; Farley v. Stroeh, 68 Mo. App. 85; Cummings v. Hurd, 40 Mo. App. 139; Sharp v. Knox, supra. See, also, Johnson v. Burley, 115 Mo. 513, 22 S. W. 492, and Rice v. Groffman, 56 Mo. 434. In Johnson v. Hurley, supra, the court quoted with approval from Mechem as follows:

"It may therefore be stated as a general rule that, whenever a person has held out another as hie agent authorized to act for him in a given capacity, or has knowingly and without dissent permitted such other to act as his agent in such capacity; or where his habits and course of dealing have been such as to reasonably warrant the presumption that such other was his agent authorized to act in that capacity, whether it be in a single transaction or in a series of transactions, his authority to such other to act for him in that capacity will be conclusively presumed, so far as it may be necessary to protect the rights of third persons who have relied thereon in good faith and in the exercise of reasonable prudence, and he will not be permitted to deny that such other was his agent, authorized to do the act that he assumed to do, provided that such act is within the real or apparent scope of the presumed authority,"

In Haubelt Bros. v. Rea & Page Mill Co., supra, the court gave expression to the same rules of law affecting agency as appears Mechem, above quoted. In the last-mentioned case the court said:

"And it may be stated as a general rule that wherever a person has held out another as his agent, authorized to act for him in a given capacity, or has knowingly and without dissent permitted such other to act as his agent in such capacity, or where his habits and course of dealing have been such as to reasonably warrant the presumption that such other was his agent, authorized to act in that capacity, whether it be a single transaction or a series of transactions, his authority to act for him in that capacity will be conclusively presumed so far as it may be necessary to protect the rights of third persons who have relied thereon in good faith and in the exercise of reasonable prudence; and he will not be permitted to deny that such other was his agent, authorized to do the act he assumed to do, provided that such act is within the real or apparent scope of the presumed authority."

2 C. J. § 32, p. 436, states that agency may be implied from a single transaction. In support of the statement the text cites, among others, Haubelt Bros. v. Rea & Page Mill Co., supra, and Grant v. Bumeriek, 123 Iowa, 571, 94 N. W. 510. In the latter case plaintiff, a dealer in monuments, employed one Stein as a workman in the shop. During the time Stein was working for plaintiff he attended to the front room of the shop when necessary, and on two different occasions prior to the one in question received and receipted for money due plaintiff. The first of the payments, $160, so received, was on November 14, 1900. This payment Stein was expressly authorized to receive and receipt for, and it was turned over to plaintiff. The other payment was received and receipted for December 20, 1900, and was turned over. January 14, 1901, defendant went to the shop to Pay her account. No one was...