Coursey v. Firestone Tire & Rubber Co.

• Decision Date: 18 May 1929
• Docket Number: No. 7945.,7945.
• Citation: 33 F.2d 49
• Parties: COURSEY et al. v. FIRESTONE TIRE & RUBBER CO.
• Court: U.S. Court of Appeals — Eighth Circuit

33 F.2d 49 (1929)

COURSEY et al. v. FIRESTONE TIRE & RUBBER CO.^*

No. 7945.

Circuit Court of Appeals, Eighth Circuit.

May 18, 1929.

James C. Kinsler, of Omaha, Neb. (Robert O. Reddish, of Alliance, Neb., and Fred A. Wright, of Omaha, Neb., on the brief), for plaintiffs in error.

P. E. Boslaugh, of Hastings, Neb. (B. M. Robinson, of Akron, Ohio, and J. W. Weingarten, of Omaha, Neb., on the brief), for defendant in error.

Before STONE and KENYON, Circuit Judges, and JOHNSON, District Judge.

JOHNSON, District Judge.

The first question to be determined in this case is whether W. B. Alexander, manager of the Omaha branch of the business of the Firestone Tire & Rubber Company, a corporation, had authority as the agent of said company to make the agreement sued upon. The trial court held that he did not have that authority and instructed the jury to return a verdict for the company. The Firestone Tire & Rubber Company at the time the alleged agreement was entered into was engaged in the manufacture and sale of automobile tubes and casings, with its manufacturing plant and principal place of business at Akron, in the state of Ohio. In the conduct of its business it had numerous branch houses located throughout the country. Harry P. Coursey and True Miller, partners, were engaged in the automobile and automobile tire and accessory business at Alliance, Neb. They alleged in their complaint that in September, 1919, an oral agreement was entered into between them and the defendant by its agent, W. B. Alexander; that the company by said agreement made and constituted them a distributing agency for its automobile tubes and casings and gave them the exclusive right to purchase the company's tubes and casings at 10 per cent. less than the company's preferred wholesale prices and to sell said products at defendant's wholesale prices to the trade within certain specified territory; that plaintiffs agreed to carry a sufficient stock of said products to supply the trade in their territory, not however at any one time to exceed the sum of $30,000 in value; that the company would employ and send out salesmen to sell plaintiffs' merchandise in the territory allotted to them; that the salesmen should pass upon the financial responsibility of all persons to whom sales were made and determine what credit should be allowed; that the salesmen should place the orders with the Firestone Company for merchandise to make up and replenish plaintiffs' stock; that plaintiffs would pay for all merchandise purchased from the company on or before the 10th of the month following date of shipment; that plaintiffs' customers should be required to make payment on or before the 10th of the month following date of shipment of goods sold to them; that plaintiffs' business would be conducted in accordance with the system of bookkeeping and accounting furnished by the company and under its supervision; that plaintiffs would make monthly reports to the company of all outstanding accounts; that upon the termination of the agreement plaintiff should have the right to return to the company all merchandise on hand for which the company would pay plaintiffs the current market prices; that plaintiffs should have the right to assign and deliver to the company all unpaid dealers' accounts, trade acceptances, notes and evidences of indebtedness which plaintiffs had or held for said merchandise sold in said territory by the plaintiffs as distributors or distributing agents for the company, and that the company would pay plaintiffs the full amount thereof; that the agreement was modified in January, 1920 (in respect to certain matters not necessary to be stated here); that the company's salesmen having theretofore overstocked plaintiffs, merchandise of the value of about $38,000 was by mutual agreement returned to the company in August, 1920; that on or about October 31, 1920, the agreement was terminated by mutual consent, at which time plaintiffs returned merchandise to the company of the value of about $3,000; and that at that time plaintiffs offered to turn over to the company all unpaid accounts, notes, trade acceptances and other evidences of indebtedness which plaintiffs had received from customers whose financial standing and credit had been passed upon and approved by the company's salesmen, and demanded that the company pay plaintiffs the face value thereof. It is alleged that the company refused to take over said unpaid accounts, notes, etc.; that said unpaid accounts, notes, etc., were worthless; and that by reason of the refusal of the company to accept and pay for said unpaid accounts, notes, etc., plaintiffs have been damaged in the sum of $26,981.81. The defendant company, in its answer, in addition to certain matters affirmatively alleged, denied generally the allegations of plaintiffs' complaint.

It is not claimed that there was any evidence that W. B. Alexander, the manager of the Omaha branch of the company's business, had express authority to make the agreement alleged in the complaint and summarized above. The claim is that in view of the evidence it was for the jury to say whether or not he had apparent authority to make it in behalf of the defendant company. For this contention we find no support in the record. It appears from the testimony in the record that stocks of the company's products were maintained in warehouses at its several branches; that a manager was in charge of each branch and that he employed an office force and selling agents or salesmen to cover the territory allotted to his branch. Until plaintiffs became wholesalers of the company's products in a part of its territory as explained below, the Omaha branch dealt directly with the trade in all of the territory assigned to it, selling and delivering goods from the stock on hand in its warehouses at prices fixed by the home office. On June 15, 1919, plaintiffs entered into a written agreement with the defendant company whereby they became wholesalers of the company's products in a part of the territory assigned to the Omaha branch. This agreement by its terms expired on the 31st day of August, 1919. After this agreement had been entered into one salesman employed and paid by plaintiffs and one employed and paid by the Omaha branch worked the territory assigned to plaintiffs by the agreement, taking orders for Firestone tubes and casings from the trade. These orders were sent to plaintiffs at their place of business...