Browning v. North Missouri Cent. Ry. Co.

• Decision Date: 03 July 1916
• Docket Number: No. 17264.,17264.
• Citation: Browning v. North Missouri Cent. Ry. Co., 188 S.W. 143 (Mo. 1916)
• Parties: BROWNING v. NORTH MISSOURI CENT. RY. CO.
• Court: Missouri Supreme Court

188 S.W. 143

BROWNING v.NORTH MISSOURI CENT. RY. CO.

No. 17264.

Supreme Court of Missouri. In Banc.

July 3, 1916.

Rehearing Denied July 18, 1916.

Appeal from St. Louis Circuit Court; Hugo Muench, Judge.

Action by E. T. Browning against the North Missouri Central Railway Company.From a judgment for plaintiff, defendant appeals.Reversed and remanded.

This suit was instituted on September 28, 1910.The petition is in two counts; the first being for damages for breach of contract concerning the furnishing of material to build defendant's contemplated railroad; the second is on an account.Plaintiff recovered on the first count $29,190.42 and interest, on the second count $1,284.71 and interest, in all $32,774.40.Defendant has appealed.

No question arises on the sufficiency or effect of the pleadings.A jury was waived, and the trial was to the court.

About December 30, 1908, defendant was incorporated for the purpose of building a railroad from Mexico, Mo., via Columbia, Ashland, and Cedar City to Jefferson City.Its incorporators were all residents of Boone county, Mo., except one who owned one share of stock and lived in New York.Its by-laws provided as follows:

"No debt shall be contracted nor liabilities incurred nor contract made by or on behalf of this company in excess of one thousand dollars ($1,000.00) unless the same be authorized or directed by the by-laws or by the duly recorded vote of the board of directors at a regular meeting or a special meeting called for the purpose."

Those by-laws also provided that its treasurer should —

"have the custody of and be responsible for all the moneys and securities of the company," and should "indorse for collection or deposit all bills, notes, checks and other negotiable instruments of the company."

Plaintiff was a resident of Kansas City and was doing business on his sole account under the name E. T. Browning & Co.About December 1, 1909, a contract in writing, purporting to be between E. T. Browning & Co. of the first part and the defendant of the second part, was signed in duplicate by plaintiff and by O. F. Spaete, defendant's president, as follows:

"E. T. Browning & Company, by E. T. Browning.North Missouri Central Railway Co., by O. F. Spaete, President.Subject to confirmation of the board of directors.O. F. S. Witness: W. Stuart Tait."

Those duplicate originals were delivered one each to plaintiff and Spaete.At the time of the execution of said contract the plaintiff delivered his draft to said Spaete for $500, payable to defendant's order.It was read in evidence with the only indorsement thereon, "North Missouri Central Railway Co., O. F. Spaete, President."Plaintiff testified that the $500 was put up as a guaranty of his good faith and ability to perform the contract.The contract made no mention of such guaranty.There is no evidence that Spaete ever accounted for that sum to defendant.The defendant objected to the evidence as to that item for the reason that Spaete as president had no authority to receive that money on behalf of defendant.The objection was overruled.The material parts of that contract are as follows:

"Memorandum of agreement made and entered into this 1st day of November, 1909, by and between E. T. Browning and Company of Kansas City, Missouri, party of the first part and North Missouri Central Railway Company(incorporated) with general offices at Columbia, Missouri, party of the second part:

"Witnesseth, the party of the first part agrees to deliver to the party of the second part, and the party of the second part agrees to purchase and receive from the party of the first part, one hundred and sixty-eight thousand (168,000) more or less, No. 1 White Oak cross-ties, f. o. b. cars at Columbia, Missouri, Mexico, Missouri, and Cedar City, Missouri, or on the ground on the north bank of the Missouri river at or near the present wagon bridge at Jefferson City, Missouri, at price per tie as follows: On ties delivered at Columbia, f. o. b. cars 68c each; on ties delivered at Mexico, f. o. b. cars 73½ cents each; on ties delivered at Cedar City, f. o. b. cars 70 cents each.On ties delivered on the ground on the north bank of the Missouri river at or near the present wagon bridge at Jefferson City, Missouri, 65 cents each, it being agreed by both parties that not less than 25 per cent. of said ties shall be delivered on the north bank of Missouri river at or near the wagon bridge at Jefferson City; the remainder of ties to be delivered at other points named herein as may be directed by second party.Each tie furnished shall be subject to inspection by the authorized agent of second party while being loaded into cars at points of shipment and shall conform to the specifications attached hereto and made a part of this contract.Delivery to begin on or before May 1st, 1910, and all of the ties to be delivered on or before July 1st, 1911.

"Witnesseth, the party of the first part agrees to deliver to the party of the second part, and the party of the second part agrees to purchase and receive from the party of the first part, No. 1 sawed white post or burr oak switch ties in sufficient numbers to lay and construct all switches and spurs that said second party may require in the construction of their railroad running from Mexico via Columbia to Jefferson City, Missouri, said switch ties to be supplied in the numbers and lengths varying in length from 8 feet up to a maximum of 16 feet by single feet.The section of said ties to be 8 inches wide and 7 inches deep.Delivery to be made at option of second party f. o. b. cars at Mexico, Columbia and North Jefferson City, all in the state of Missouri, at the price of 12½ cents per lineal foot.All of the above material to be sawed from sound, live, straight white post or burr oak timber, free from wind-shakes, rots or black rotten knots, and to be sawed straight and smooth.

"Delivery to begin on or before May 1, 1910, and to be completed by July 1, 1911.

"Witnesseth, the party of the first part agrees to deliver to the party of the second part and the party of the second part agrees to purchase and receive from the party of the first part, in quantity and quality all the white cedar poles required by said second party in the construction of their electric line to be built from Mexico, Missouri, to Jefferson City, Missouri, via Columbia, Missouri, being about 60 miles in length.The poles furnished to be 40 feet in length and not less than seven (7) inches in diameter at the small end and to be peeled of all bark.The specification for the poles is attached hereto and is in accordance with the specifications of the N. W. C. Association.In the delivery of the said poles the size of the best poles shall not be robbed but we will deliver woods run; said poles shall be straight and smooth and shall be delivered f. o. b. cars at Mexico, Missouri, at the price of seven and 49/100 dollars ($7.49) per pole.Delivery to commence on or before May 1st, 1910, with full delivery by July 1st, 1911.Deliveries will be made at Columbia, Missouri, or North Jefferson, Missouri, at an additional cost of freight only from Mexico, Missouri, to said points; same to be paid by second party if such delivery is required.Terms of payment: Payment for said ties, switch ties and poles, shall be made by second party as follows to wit: For all ties, switch ties and poles delivered up to, and including January 1st, 1911, payment to be made on that date, and for the balance of said ties, switch ties and poles, up to complete delivery payment to be made July 1st, 1911.Each of said payments to bear interest at the rate of six (6) per cent. per annum, from date of bills for said poles so delivered.Such payments to be secured by a good and sufficient bond acceptable to said first party."

Defendant objected to said instrument on the ground that Spaete did not have authority to execute the same, and that it had not been approved by defendant's board of directors.The objection was overruled.

On February 12, 1910, V. H. Roberts, general counsel of defendant, sent to the plaintiff by mail the following document:

"North Missouri Central Railway Co., St. Louis, Mo., Feby. 15, 1910.This is to certify that at a meeting of the board of directors of the North Missouri Central Railway Company held on February 12, 1910, the following resolution was adopted, to wit: Resolved, that the contract heretofore made and entered into by and between the North Missouri Central Railway Company and E. T. Browning & Company of Kansas City, Missouri, for the purchase and delivery of railroad ties and poles be and the same is hereby approved.

   "A true copy
                           "North Missouri Central Railway Co
                       "[Seal.]    By O. F. Spaete, President
                

"Attest: M. B. Johnson, Assistant Secretary."

Plaintiff testified that the signature of Spaete to that document was in Spaete's handwriting.There was no evidence to the contrary.The evidence shows that no such entry as there called for was ever made in the record of proceedings of the board of directors, and that M. B. Johnson was never such assistant secretary.There is no evidence to show what, if any, knowledge plaintiff had that such document was false.

About January 22, 1910, by correspondence in writing between plaintiff and W. Stuart Tait, defendant's chief engineer, it was agreed that 2,500 7-inch 40-feet Idaho cedar poles at $7.35 each and 500 6-inch 30-foot Northern cedar poles at $2.30 each should be substituted for the poles named in the original contract.About April 19, 1910, by correspondence in writing between plaintiff and H. A. Albin, defendant's general manager, it was agreed that black walnut cross-ties would be accepted under said contract the same as other ties; that plaintiff should have the option to deliver 9,000 No. 2 cross-ties as a part of the whole number to be delivered, at 10 cents less per tie than for No. 1 ties, also that No. 1 ties...