Fox v. Morse

• Decision Date: 15 May 1959
• Docket Number: No. 37532,37532
• Citation: 96 N.W.2d 637,255 Minn. 318
• Parties: Carl FOX and Agnes Fox et al., Respondents, v. William A. MORSE et al., Defendants, William A. Morse, Appellant.
• Court: Minnesota Supreme Court

Page 637

96 N.W.2d 637

255 Minn. 318

Carl FOX and Agnes Fox et al., Respondents, v. William A. MORSE et al., Defendants William A. Morse, Appellant.

No. 37532.

Supreme Court of Minnesota.

May 15, 1959.

Syllabus by the Court.

1. A master can be held liable for the negligence only of those employed by his authority. Such authority may be implied from the nature of the work to be performed and also from the general course of conducting the business of the master by the servant.

2. Apparent authority of an agent rests on an estoppel to deny authority based on a third party's reliance on the appearance of authority permitted by an alleged principal. Where there is no reliance on such appearance of authority, apparent authority is not involved.

3. Implied authority of an agent is actual authority, circumstantially proved. It is actual authority implied from a course of dealing between the alleged principal and his alleged agent.

4. Where the authority of an agent is proved circumstantially, inference of authority must be drawn from facts for which the principal is responsible.

5. The evidence in this case sustains a finding that defendant had authorized an employee to hire additional temporary help as ti was needed.

6. Ratification of another's unauthorized act occurs when a party, with full knowledge of all material facts, confirms, approves, or sanctions the other's acts. Where an act is done without precedent authority, ratification creates the relationship of principal and agent, and the principal is bound to the same extent as if the act had been done under prior authority.

7. Under the facts of the case the evidence sustains an inference of ratification.

Merlyn C. Green and Bundlie, Kelley & Maun, St. Paul, for appellant.

Thomas, Bradford, King & Collatz; Stacker & Stacker and Thomas J. Burke; Randall, Smith & Blomquist; Schway & Nemer; Harold L. Rutchick; Carlyle Knudtson; Robins, Davis & Lyons; Eugene W. Hoppe and Lipschultz, Altman, Geraghty & Mulally, St. Paul, for respondents.

KNUTSON, Justice.

This is an appeal from an order denying alternative motions of defendant William A. Morse for judgment notwithstanding the verdict or a new trial.

Defendant William A. Morse was the owner of an apartment hotel in St. Paul known as the Willard Hotel. There were some 90 units in the hotel, consisting for the most part of apartments. Morse does not live in the hotel but lived in Minneapolis. In the operation of this hotel, Morse had six regular employees. Mrs. Alberta Howard was known as manager or caretaker, and among her duties she rented apartments; had responsibility for decorating and redecorating apartments; received complaints of tenants; inserted ads in newspapers for help when needed and interviewed prospective employees; kept the books of the hotel's operations and made out the payroll for employees; ordered hotel supplies from regular suppliers as they were needed; drew the payroll and expense checks, which then were signed by Morse; computed withholding and social security taxes of employees; was responsible for pest control and ordered the work necessary therefor done as it was needed; and in general had full charge of the operation of the hotel. In addition to Mrs. Howard, the regular employees consisted of Sylvester W. Davis, a full-time painter and maintenance man; two maids; a night man; and a general maintenance man and stationary engineer. Normally, these six employees were sufficient to operate the hotel, but on occasions additional help was required for short periods of time.

On December 11, 1955, Davis had fallen behind in his work, and he and Mrs. Howard discussed the matter of procuring some additional help. As a result of this discussion, defendant William Oswald was told to report for work, and he did so on December 12. He worked all that day and again reported for work on the next day. Part of his work on December 13 consisted of removing varnish from the floor in one of the apartments. In performing this work he used a highly inflammable liquid as a varnish remover. The old varnish that was removed and rags which had been saturated with inflammable liquid were placed in a metal pan as they were discarded. During the course of this work he threw a cigarette which he assumed had been extinguished into the refuse pan, and a fire resulted which quickly spread throughout the building, virtually destroying two entire floors thereof.

Separate actions were brought by 45 tenants of the building against Morse and Oswald to recover damages for the loss of personal property destroyed by the fire on the ground that the fire was negligently started by Oswald, who was an employee of Morse. Oswald has not answered and is in default. Morse will be referred to herein as defendant. In a pretrial conference it was agreed that the issues of the negligence of Oswald and the liability of Morse would be tried first and that all the actions should be controlled by the outcome of this trial as to those issues, leaving only the issue of damages to be tried in each individual case. The jury returned a verdict against defendant.

It is the contention of defendant Morse that Oswald was not his employee or agent. The case was submitted to the jury for a determination of whether Oswald was an employee of Morse and whether his negligence caused the fire. No issue is made of the jury's determination of the issue of negligence or proximate cause on this appeal. Two questions are presented here: (1) Does the evidence sustain the jury's finding that Morse had authorized the employment of Oswald? (2) If not, did he ratify such employment?

1. The applicable principles of law are not seriously in dispute. The rule with respect to liability of a master for negligence of a servant probably is as well expressed in Haluptzok v. Great Northern Ry. Co., 55 Minn. 446, 450, 57 N.W. 144, 146, 26 L.R.A. 739, 741, as anywhere. We there said:

'* * * a master, as such, can be held liable for the negligence only of those who are employed in his work by his authority; and hence, if a servant who is employed to perform a certain work procures another person to assist him, the master is liable for the sole negligence of the latter only when the servant had authority to employ such assistant. Such authority may, however, be implied as well as express, and subsequent ratification is equivalent to original authority; and, where the servant has authority to employ assistants, such assistants, of course, become the immediate servants of the master, the same as if employed by him personally. Such authority may be implied from the nature of the work to be performed, and also from the general course of conducting the business of the master by the servant for so long a time that knowledge and consent on part of the master may be inferred. It is not necessary that a formal or express employment on behalf of the master should exist, * * *. It is enough to render the master liable if the person causing the injury was in fact rendering service for him by his consent, express or implied.'

In 57 C.J.S., Master and Servant, § 564a, the rule with respect to the authority of a servant to employ assistants is stated thus:

'* * * The authority to employ assistants may be either express or implied; it may be implied from the nature or extent of the work to be performed, from the circumstances of the particular case, from the general course of conducting the business of the master by the servant, as where it is such as necessarily requires the help of others, ¹ * * *.

'Ratification. A master may also become liable for the acts of an assistant employed by the servant where he ratifies such employment.'

2. There is some discussion by defendant of apparent authority. Apparent authority which rests on an estoppel to deny authority based on a third party's reliance on the appearance of authority permitted by the principal ² is not involved here. None of the tenants injured by the fire claim any reliance upon such appearance of authority.

3. Implied authority as we use the term here is actual authority, circumstantially proved. ³ It is actual authority...