Brooks v. Griel Bros. Co.

• Decision Date: 11 April 1912
• Citation: 179 Ala. 459,60 So. 387
• Parties: BROOKS v. GRIEL BROS. CO.
• Court: Alabama Supreme Court

60 So. 387

179 Ala. 459

BROOKS v. GRIEL BROS. CO.

Supreme Court of Alabama

April 11, 1912

On Rehearing, December 17, 1912.

Appeal from Circuit Court, Montgomery County; W. W. Pearson, Judge.

Action by Mary E. Brooks against the Griel Bros. Company. From a judgment for defendant, plaintiff appeals. Affirmed.

Dowdell C.J., and Simpson and Sayre, JJ., dissenting.

Powell & Hamilton, of Greenville, for appellant.

Steiner Crum & Weil, of Montgomery, for appellee.

SIMPSON J.

This is an action by the appellant against the appellee for money had and received, based upon the claim that the defendant had received certain bales of cotton which were paid by a renter on plaintiff's plantation for rent, and had sold the same. The facts are plaintiff owned a plantation in Lowndes county known as the "Williamson place." The records of the probate court of said county show that the lands of the estate of plaintiff's father were partitioned in 1877, a certain portion of said lands being allotted to the plaintiff (then Mary E. Williamson), and that she subsequently purchased the remaining lands of the plantation in question from Mary J. Brown. It is shown that she had been in possession of said lands for years before the lease hereafter mentioned, and is still in possession of the same. In December, 1903, the husband of plaintiff, C. E. Brooks leased said lands to one W. A. Crenshaw for the years 1904 1905, and 1906, with the privilege of retaining the lands for the years 1907 and 1908, at the option of the tenant; the rent named being 37 bales of cotton, to weigh 18,500 pounds, payable on October 1st of each year. Crenshaw executed nonnegotiable notes for said rent, payable to said C. E. Brooks, and said C. E. Brooks from time to time transferred said notes to Griel Bros. Company as collateral security for his individual indebtedness to said defendant. Said Crenshaw was a man of property, owning other lands, and, as he collected these rents and others which were due him, he shipped the cotton to a warehouse in Montgomery, and when these rent notes became due he would give an order to Griel Bros. Company (the defendant) for the requisite number of bales, without specifying particularly what bales were to be delivered to them. The defendants acknowledge that the rent notes were paid to them by said Crenshaw; that they sold the same; and they furnish a statement of the amounts received, which is not controverted. The rent notes, payable to C. E. Brooks, specified that the amount of cotton agreed to be paid was "for the rent of his plantation known as the Williamson plantation, situated east of the Louisville & Nashville Railroad, in Lowndes county, Ala."

C. E. Brooks, who was merchandising in Lowndes county, had at one time done business in the name of his said wife, and had business transactions with the defendant, but at the time of making the debts, for which these rent notes were deposited as collateral, he was doing business in his own name. The plaintiff and her said husband testified that she did not know anything about her said husband's having taken the rent notes in his own name, or about his transferring them to the defendant, until shortly before the institution of this suit; but, on the contrary, from time to time requested him to appropriate the rents to the payment of a mortgage on her said lands. So, there being no controversy as to the amounts received, the only question for decision is whether, under the facts of this case, the defendants are liable in this action. It has been settled, by the decisions of this court, that the true owner of land may, in an action for money had and received, recover rents which have been received by another, when the land is not held adversely by another. Price v. Pickett et al., 21 Ala. 741, 743; Young v. Garber, 149 Ala. 196, 198, 199, 42 So. 867; 27 Cyc. pp. 865-6.

It is true, as claimed by the appellee, that, by making his note payable to C. E. Brooks, Crenshaw thereby assumed a personal obligation to said C. E. Brooks, and would be estopped thereby, in an action on the note, from denying the right of said C. E. Brooks to the payment of the note, but it nevertheless remains true that said notes were given for the rent of plaintiff's land, and so specified in the note, and when the defendant took those notes as collateral, and after-wards collected them, he was collecting the rents due for plaintiff's lands. The fact that the notes were made payable to the agent, C. E. Brooks, did not make said rent notes any the less the property of the plaintiff, and she could have maintained an action on them against Crenshaw. Powell v. Wade, 109 Ala. 95, 97, McFadden & Bro. v. Henderson et al., 128 Ala. 221-229, 29 So. 640. It cannot, then, in this case make any difference that it is not proved that the cotton which defendant received was raised on the plantation of plaintiff. This is not a case seeking to enforce the landlord's lien, but an action for money had and received, which ex equo et bono belonged to the plaintiff, because it was paid in satisfaction of an obligation to pay for the rent of plaintiff's lands.

Appellee next insists that Crenshaw, the tenant, by receiving a lease from the agent, C. E. Brooks, in which the land is mentioned as "his plantation" (that is, C. E. Brook's), was therefore holding adversely to the plaintiff, and therefore comes within the exception in the cases on the subject of the landlord's recovering for rents collected. If that were true, every tenant who does not rent directly from the landlord could say that he is holding adversely. The true principle is that, if the party who undertakes to lease the land to the tenant is holding adversely to the true owner, said owner cannot recover in this action because it would involve a decision as to the title to the land. Young et al. v. Garber, 149 Ala. 198, 42 So. 867; Price. v. Pickett, supra. C. E. Brooks never claimed any interest in the land, but acted solely as the agent of his wife. Consequently no question of adverse holding occurs in this case.

It is true, as contended by the appellee, that, when the principal sues on a contract made by the agent, he thereby ratifies the contract, but that does not carry with it a ratification of what the agent may afterward do with the contract, or its proceeds, in violation of his duty as agent. The principal in this case ratifies the contract of leasing, and claims only what the tenant agreed to pay as rent. This court has held that where the wife's lands were sold, and she allowed the note for purchase money to be made payable in the alternative to herself or her husband, she was not estopped to assert her title to, and ownership of, the note as against her husband's creditor (Corry, Adm'r, v. Jones et al., 114 Ala. 502, 21 So. 815), also that where an agent made a contract granting mining privileges on the wife's lands, without disclosing his principal, the principal could sue on the contract. Brooks et al. v. Cook et al., 141 Ala. 499, 504, 38 So. 641.

Before the principal can be held to have ratified the acts of the agent, acting beyond his authority, it must be shown that the person ratifying had full knowledge of all the facts and circumstances, and of the acts of the agent, previous to ratification. Brown v. Bamberger, Bloom & Co., 110 Ala. 344, 354, 355, 20 So. 114; 31 Cyc. pp. 1253-1256. The principal has the right to presume that the agent will act only within the sphere of his authority, and, in the absence of circumstances sufficient to put one of reasonable prudence on inquiry, is not held to any diligence to ascertain the fact that the agent is acting beyond his powers. 31 Cyc. p. 1256; Nourse v. Jennings, 180 Mass. 592, 62 N.E. 974.

The cases in which the principal has been held to responsibility for the acts of the agent, so as to render the proceeds of sale subject to offsets against the agent, are those in which the principal has intrusted the possession of personal property, with all the indicia of ownership, to the agent, and the distinction is clearly drawn between the case of a factor who is intrusted with the possession and control of the goods, and a broker who is not so intrusted; the right of set-off against the agent obtaining in the former but not in the latter. Bernshouse v. Abbott, 45 N. J. Law, 531, 46 Am. Rep. 789, 790. Of the former class is the case of First National Bank v. Nelson, 106 Ala. 535, 18 So. 154, referred to in appellee's brief. In that case the wife indorsed the notes and placed them in the hands of her husband, thus arming him with the indicia of ownership and authority to transfer them as his own.

In the case of Tobias v. Josiah Morris & Co., 126 Ala. 550 28 So. 521, the wife was present in the bank when the husband deposited the money, reserving the privilege to check it out himself, and the court held that it was a question for the jury to decide whether the wife was estopped, saying: "Although she may not have heard what was said, and did not see the signature given, yet, if by her acts and conduct on the occasion, she led the bank to believe that she had intrusted the entire matter to Jones and her husband, or to her husband, to make the contract of deposit, and how the account was to be kept, and how drawn out, and it acted upon it, she must suffer for her own neglect rather than the bank." The case of Gardner & Sager v. Allen's Executor, 6 Ala. 187, 41 Am. Dec. 45, involved the purchase of goods from a factor, and the court italicizes the allowance of the set-off " if he purchased under a just belief, authorized by the facts of the case, that the agent was the real owner of...