Bond v. Pontiac, O. & P.A.R. Co.

• Decision Date: 07 October 1886
• Citation: 29 N.W. 482,62 Mich. 643
• Parties: BOND v. PONTIAC, O. & P.A.R. CO.
• Court: Michigan Supreme Court

29 N.W. 482

62 Mich. 643

BOND v. PONTIAC, O. & P.A.R. CO.

Supreme Court of Michigan

October 7, 1886

Error to Lapeer.

J.B. Moore, for plaintiff, William Grant Bond.

A.C. Baldwin, for defendant and appellant Pontiac, O. & P.A.R. Co.

CAMPBELL, C.J.

Plaintiff sued, and recovered against defendant, on an alleged verbal contract made with F.B. Howard, as chief engineer, whereby plaintiff was to have the building of 14 depot buildings, for which he made preparations, but which, as he claims, he was not allowed to complete. Defendant denies any such contract relations. It was claimed by defendant, and shown by testimony in no way impugned, (although the jury, without any evidence, found otherwise,) that the whole building and equipment of the railroad had been put under contract with the New York, New England & Western Investment Company, and that defendant had nothing further to do with it, and none of defendant's officers or agents had any authority in the matter. In order to make out his case, plaintiff, by his own testimony, swore to the making of the arrangement with Mr Howard. To establish Mr. Howard's authority he introduced testimony of various things done on the road, from which he claimed authority might be inferred against defendant.

The contract in question for building the road bound the defendant to furnish right of way and depot ground, and the investment company was to do all the rest, except a tract near Caseville, to be built by Francis Crawford, near his mill. He was also to furnish an amount of ties which the investment company was to pay for.

It is not disputed, and the court below so charged the jury, that no testimony appeared of any corporate action authorizing Mr. Howard to act for the defendant in the matter in controversy, or ratifying his action. The contract with the investment company bound defendant to appoint, as chief engineer, secretary, and treasurer, persons satisfactory to the investment company. The case does not show any grant of power from defendant to any such officers, or that any of them represented defendant in the work which was in progress by any such authority. No payment was made to plaintiff, and no recognition was had by defendant of the contract in question, and no facilities were given him for carrying it out. The action is for not permitting its completion, and not for performance. The case was placed entirely on circumstantial evidence, and the questions relate chiefly to its force and validity.

It was early objected that plaintiff and his witnesses were allowed to refer repeatedly to defendant as the party dealing or dealt with when the question of authority was mooted, and it was essential to know with what particular person the dealing was had. We think the objection should have been regarded and that the court, by allowing witnesses to persist in such references, placed the jury in a position where they were not only liable to be misled, but were also likely to overlook the necessity of proof of authority.

In order to understand the bearing of the facts admitted against defendant, it is necessary to consider the position of various persons whose actions were deemed important on the trial. Mr. Howard was nominated to the investment company and approved by them, as engineer of the defendant in 1881, and so continued until some time in 1883. He was entirely paid by and received orders from the investment company as their own engineer. No record was shown of any instructions or powers from defendant. George Nettleton succeeded him. F.H. McCarroll was paymaster of the investment company until July, 1883, and secretary of the defendant after July, 1883. Alfred R. Fiske was examiner and engineer of the investment company, through whom orders were generally given, until January, 1883. He was never an agent or officer of defendant. George W. De Bevoise was secretary and treasurer of the investment company, and had general charge over the road for that company, relieving Mr. Fiske in January, 1883. He represented no one else. Charles A. Carpenter was president of defendant, and Junius Ten Eyck, Abram Le Roy, J.T. Stanton, and others, directors.

The record was voluminous, and, in the manner from which some part of the case was brought in, somewhat confused. Defendant claimed that the jury should have been directed that no cause of action was made out, and this required a full report. Other questions were also raised, and are presented by the assignments.

As already suggested, the only ground relied on for recovery is the implication claimed to arise of authority or ratification from acts of various persons, which it is insisted should bind defendant. Those facts and acts are substantially these: The most important, according to plaintiff's argument, was the employment of plaintiff, in 1882, upon the construction of two bridges along the line of the railroad. It was claimed that plaintiff made a contract with Howard for the construction, under plans which Howard furnished, rendering monthly bills to the assistant engineers, Mr. McCormick and Mr. Nettleton, against defendant, and paid by Mr. McCarroll, as plaintiff claims, as defendant's pay-master. It is further claimed that in those transactions blanks were used purporting to be defendant's; that after the bridges were finished, plaintiff was informed by Howard that he was desired to make bids on depot buildings, which were accepted by Howard; and that De Bevoise also informed him that Howard had been directed to get bids and complete a contract. Plaintiff was allowed to put in evidence, and relied upon the facts, that rights of way and aid subscriptions were procured by defendant's officers, and that ties were purchased and delivered by one of them, and that bills of various kinds were paid by Mr. McCarroll for work and other things made out in the defendant's name. These various matters, upon most of which there was contradictory or explanatory testimony, were received as showing authority in Howard to bind defendant in this contract. Howard's own testimony, as well as that of several others, was directly contradictory of plaintiff's in its material features; but, so far as admissible, its weight would be for the jury.

Upon a careful examination of the record we think the defendant was entitled to have the case taken from the jury as entirely unsupported by legal proof. There is not in any part of the record any testimony tending to show that Howard had any authority to make contracts of the kind involved for defendant. The contract, as sworn to by plaintiff, is a peculiar one, which, when made, according to him, specified neither the number nor the locality of the various depot buildings, nor at what places the first and second-class buildings, which varied considerably in price, were to be set up. The memorandum of the verbal understanding, on which plaintiff places his claim, contains no time for doing the work, and no terms of payment except the gross sums for building. It appears from plaintiff's testimony that, pending the preparation and consideration of proposals and bids, he received a letter from Howard indicating that a written contract was contemplated, and that he also knew that De Bevoise was Howard's superior, under whose direction Howard was to act in regard to the depots, and that, on the eighteenth of May, De Bevoise, who had never recognized the contract, told him Howard had no authority to make it. It further appears from his testimony that, while he was seeking to be allowed to carry out the project, he corresponded with De Bevoise, and knew from him that authority to proceed must come from the New York parties, and that he also wrote to the president of the investment company repeatedly, insisting on the liability of that company for Howard's acts.

It is certain that no presumption can arise of any power in a chief engineer, even where a railroad company is acting in the completion of its own road, to make such a contract as the one relied upon here. The definite location of depots is one of the most important duties of the company and belongs to the board of directors, unless clearly delegated elsewhere. A chief engineer cannot be made the possessor, by delegation, of the double power of locating and contracting for building them, if he can be at all, without the authority of the board, on which the railroad law imposes the duty of conducting the corporate business. And we have said that the action of such a board cannot be derived from anything but their concurrent doings, and that no one has a right to rely on the statements of an agent concerning his own agency. Trudo v. Anderson,...