Connell v. McLoughlin

• Decision Date: 11 November 1895
• Citation: 28 Or. 230,42 P. 218
• Parties: CONNELL v. McLOUGHLIN.
• Court: Oregon Supreme Court

42 P. 218

28 Or. 230

CONNELL v. McLOUGHLIN.

Supreme Court of Oregon

November 11, 1895

Appeal from circuit court, Multnomah county; H. Hurley, Judge.

Action by Samuel Connell against Martha E. McLoughlin. There was a judgment for plaintiff, and defendant appeals. Reversed.

A.L. Veazie, for appellant.

Albert Abraham, for respondent.

MOORE, J.

This is an action to recover upon a promissory note alleged to have been executed by an agent of the defendant. The facts are that one E. McLoughlin, being the lessee of certain premises in the city of Portland, owned a building thereon, in which he operated a sash and door factory under the firm name and style of the Portland Door & Lumber Company; that on June 7, 1893, for the expressed consideration of $7,000, he executed a bill of sale to his mother, the defendant, in which he assigned all his right title, and interest in and to said building, and also transferred to her all the machinery, tools, and furniture therein, together with the stock of merchandise and material on hand, which bill of sale was duly recorded on the day succeeding its execution; that McLoughlin took a power of attorney from his mother, authorizing him to dispose of the property so transferred to her, and continued to operate the factory for her under the same firm name; that one E.S. Bryant, having furnished to said firm, for use in the factory, lumber and materials of the reasonable value of $452.21, McLoughlin, on June 7th of that year, as evidence of the amount due Bryant, executed to him a promissory note payable in three months, and signed the same, "Portland Door & Lumber Co., per E. McLoughlin, Manager"; that Bryant, in consideration of $300 to be paid to him if the amount due thereon could be collected from the defendant assigned it before maturity to the plaintiff, who alleged in his complaint the necessary facts to show that he was the owner and holder thereof. The defendant denied the material allegations of the complaint, and upon a trial of the issues thus joined the plaintiff introduced his evidence, and rested, whereupon the defendant moved the court for a nonsuit, which, being denied, a verdict was rendered for the plaintiff, and from the judgment thereon the defendant appeals.

It is contended that the plaintiff failed to introduce any evidence tending to show McLoughlin's authority to execute the note for the defendant, and that the court therefore erred in denying the motion for a nonsuit. The existence of an agent's authority depends upon the intention of his principal, and is purely a question of fact. Glenn v. Savage, 14 Or. 567, 13 P. 442. If there be any dispute as to the fact in issue, it is clearly a question for the jury; or, if there be no dispute as to the facts, but there may reasonably be a difference of opinion as to the inferences and conclusions deducible therefrom, it is the province of the jury to determine the question. Goshorn v. Smith, 92 Pa.St. 435; Herbert v. Dufur, 23 Or. 462, 32 P. 302; Hedin v. Railway Co., 26 Or 155, 37 P. 540. The witness Bryant testified that when he accepted the note he supposed McLoughlin was a member of the Portland Door & Lumber Company, and that he did not know the defendant, nor had ever heard of her, while McLoughlin testified that his power of attorney only authorized him to dispose of the property, stock, and material, and that he had no direct authority from his mother to execute the note. Assuming that a conclusion could be based upon a want of proof, and that it might reasonably be inferred that, while the power of attorney did not authorize McLoughlin to execute notes for his mother, he acquired such authority by some other means, and that, although the power to do so was not directly conferred, it was clearly implied, such an inference would not authorize the court to submit the question to the jury, for the inference so deduced could not be of greater weight than a positive declaration by McLoughlin that he had authority to execute notes for his mother, in the absence of any proof that she knowingly acquiesced in such statements, if made by him. The rule is well established that the authority of an agent cannot be proved by his own statements that he is such, in the absence of evidence that the principal knowingly acquiesced in such declarations. Graves v. Horton (Minn.) 35 N.W. 568; Hatch v Squires, 11 Mich. 185; Streeter v. Poor, 4 Kan 412; Railway Co. v. Kinman, 49 Kan. 627, 31 P. 126. The authority of one person to act for another rests upon the intention of the principal to be bound by the acts and contracts of his agent. In controversies between the principal and his agent this intention may be proved by the written commission conferring the power, or by acts or declarations of the principal in acknowledgment of the agent's authority; while in actions between the principal and third persons, growing out of their contracts with his agent, the intention of the principal may be proved in the same manner as in controversies between him and his agent, and, in addition thereto, it may be inferred from apparent authority, by proving that the principal knowingly permitted the agent to assume, or that he held the agent out to the public as possessing, the necessary power; and hence the validity of a contract made with an agent and the right of action founded on its breach grow out of the intention of the principal to be bound by the act of his agent. A principal is bound by whatever his agent may lawfully do within the scope of the power conferred, and upon the theory that where a right is conferred the power is also granted without which the right itself cannot exist this scope includes whatever the agent may necessarily do in the performance of the particular act expressly authorized. Law v. Stokes, 32 N.J.Law, 249. "The authority of an agent," says Andrews, J., in Walsh v. Insurance Co., 73 N.Y. 5, "is not only that conferred upon him by his commission, but also, as to third persons, that which he is held out as possessing. The principal is often bound by the act of his agent in excess or abuse of his actual authority, but this is only true between the principal and third persons, who, believing and having a right to believe that the agent was acting within, and not exceeding, his authority, would sustain loss if the act was not considered that of the principal." The principle announced in this case carries the doctrine of liability to the very verge, and proceeds upon the estoppel of the principal,...