Hunt v. Sanders

• Citation: 281 S.W. 422,313 Mo. 169
• Parties: W. B. HUNT, Administrator of Estate of MRS. W. B. HUNT, v. W. E. SANDERS, Appellant
• Decision Date: 12 March 1926
• Court: United States State Supreme Court of Missouri

281 S.W. 422

313 Mo. 169

W. B. HUNT, Administrator of Estate of MRS. W. B. HUNT, v. W. E. SANDERS, Appellant

Supreme Court of Missouri

March 12, 1926

Appeal from Jasper Circuit Court; Hon. Grant Emerson Judge.

Reversed and remanded.

Owen & Davis, Norman A. Cox and Hugh Dabbs for appellant.

(1) One who sells notes as owner or as agent of an undisclosed principal, may be held on either an express warranty as to the genuineness of the notes, or on an implied warranty as to their genuineness, but not on both, for they embrace the same matter, and the express warranty excludes the implied warranty. Therefore, where plaintiff sues on a warranty of one who sells as owner or as agent of an undisclosed principal, and the petition is broad enough to cover both express and implied warranty as to the same subject-matter he must elect whether he will base his right to recovery on express or implied warranty, and for the court not to require him to do is error. One who sells notes as agent of a disclosed principal, cannot be held liable on a warranty of the genuineness of the notes whether the warranty is express or implied, for the warranty is then conclusively presumed to be the warranty of his principal. Where one sells as agent of a disclosed principal, he can only be held liable personally, on his own personal agreement to be liable on a warranty of the genuineness of the notes, and in this case, the warranty must be an express one. Huston v. Tyler, 140 Mo. 363; International Co. v. Smith, 17 Mo.App. 264; Fruit & Truck Assn. v. Hartman, 146 Mo.App. 168; 2 Meechem on Sales, p. 1095, sec. 1295; Thompson, Payne & Co. v. Irwin & Co., 76 Mo.App. 430; Registry Co. v. Supply Co., 207 Mo.App. 462; Michael v. Jones, 84 Mo. 582; 13 C. J. p. 243, sec. 9. (2) Plaintiff, in her instruction numbered six, submitted her case to the jury on her evidence and theory of an express warranty, on the theory that defendant disclosed to plaintiff defendant's principal, Wilgus, and told plaintiff that Wilgus owned the notes. In such case, the law presumes the warranty of the agent as to the quality of the thing sold to be the warranty of his principal, and the agent, if acting in good faith, cannot be held, personally, on the warranty, unless the agent goes further and agrees himself to be bound, and he is informed that credit is extended to him alone; and the burden of proof to establish this collateral agreement of the agent is on the plaintiff. Instruction numbered six is not within the allegations of the petition and does not present to the jury for finding any facts on which such a collateral agreement on the part of defendant to be personally bound can be predicated, or any facts on which to base a finding that plaintiff extended credit to defendant and informed defendant of that fact, but, as given, that instruction charges a warranty by an agent of a disclosed principal, of a matter within the scope of his agency, which binds only the principal, and not the agent, the defendant here, and said instruction, in telling the jury to find for the plaintiff and against the defendant, constituted reversible error. 2 Clark & Skyles on Agency (1905 Ed.) p. 1221, sec. 565; 21 R. C. L. p. 846, sec. 25; Thompson, Payne & Co. v. Irwin & Co., 76 Mo.App. 430; Sprague v. Rosenbaum, 38 F. 386; Curtis v. Miller, 50 L. R. A. (N. S.) 604; Wilder v. Cowles, 100 Mass. 490; Steamship Co. v. Transportation Co., 135 Mass. 421; Dahlstrom v. Gemunder, 19 Am. & Eng. Ann. Cas. 771, 198 N.Y. 449; Huston v. Tyler, 140 Mo. 363; Anderson v. Timberlake, 62 Am. St. 105; Fruit & Truck Assn. v. Hartman, 146 Mo.App. 168; 1 Meechem on Agency, sec. 1422; Michael v. Jones, 84 Mo. 582; Hunt v. Sanders, 288 Mo. 351; Ellis v. Stone, L. R. A. 1916F, 1228; 31 Cyc. 1552-3; State ex rel. v. Ellison, 272 Mo. 583. (3) The matter of the good faith of the agent in making express warranties as to quality, where he discloses his principal, is an element of the agent's defense against personal liability on the warranties, and the court committed reversible error in refusing to permit defendant to introduce evidence to show that at the time he sold the notes in question to plaintiff (his defense being that he sold them as agent of a disclosed principal) that he did not know that the notes were forged, and that he believed them to be genuine. Huston v. Tyler, 140 Mo. 268; Dahlstrom v. Gemunder, 19 Am. & Eng. Ann. Cas. 771; Lang v. Friedman, 166 Mo.App. 362; Roemer Co. v. Annan, 81 Mo.App. 572; Thompson, Payne & Co. v. Irwin Co., 76 Mo.App. 434; Michael v. Jones, 84 Mo. 582; Bank v. Orthwein, 160 Mo.App. 369; Tillman v. Bungenstock, 185 Mo.App. 66. Defendant offered to prove by other real estate and loan agents that it was the custom, in the district, where an agent sold a loan for his principal, to have the check made payable to the agent, who would deduct his commission and pay over the balance to the principal. The evidence offered was competent.

Haywood Scott for respondent.

(1) The rules of pleading require that matters should be pleaded according to their legal effect, and general allegations of warranty are sufficient without stating whether it is expressed or implied; and although the warranty be implied by law, yet when the implication arises from a statement made it is an express warranty. Long Bros. v. The J. K. Armsby Co., 43 Mo.App. 253; Hoe v. Sanborn, 21 N.Y. 352, 1 Smith Leading Cases (9 Am. Ed.) 329; Hawkins v. Pemberton, 51 N.Y. 198. (a) Either an express warranty or one implied by law could be shown to sustain the allegations of the petition in this case. Hunt v. Sanders, 288 Mo. 337. (b) It is only where an implied warranty is inconsistent with an express warranty that all implied warranties are merged in or are superseded by the express warranty. Natl. Cash Register Co. v. Layton, 207 Mo.App. 462; Boulware v. Victor Auto Mfg. Co., 163 Mo.App. 524; Fairbanks, Morse & Co. v. Baskett, 98 Mo.App. 53; Miller & Co. v. Hunter, 82 Mo.App. 632; Acme Harv. Machine Co. v. Gasperson, 168 Mo.App. 558. (c) The jury were instructed to the effect that plaintiff was entitled to recover either on an implied warranty or on an express warranty. The express warranty was not inconsistent with the implied warranty. It merely expressly stated that the paper was genuine, a warranty which the law implied under the circumstances of this case. Hunt v. Sanders, 288 Mo. 337. (2) Instruction 6 was in accordance with the allegations of the petition and was supported by the evidence, partly by the plaintiff's evidence and partly by the defendant's evidence. It was based on an express warranty of the genuineness of the paper sold by defendant to plaintiff. The warranty of genuineness of the paper sold implied by law under the circumstances does not conflict with the defendant's express warranty of genuineness of the paper and it did the defendant no harm for the court to instruct the jury that the plaintiff could recover on either an implied warranty or an express warranty. The defendant was liable on the implied warranty if he did not disclose his agency or his principal, and he was also liable on an express warranty if he did not disclose his agency or his principal or if he did disclose his agency or his principal. It is immaterial which instructions the jury followed if the defendant was liable under all of them. This court has decided that he was so liable. The trial court followed this court's opinion on the first appeal. Questions fully considered and decided by this court in the former appeal will not, upon a second appeal, be open to dispute or further controversy. Hunt v. Sanders, 288 Mo. 337; Hombs v. Corbin, 34 Mo.App. 393; Crecelius v. Bierman, 68 Mo.App. 34. Respondent testified that appellant did not disclose his agency or his principal and that appellant expressly warranted the genuineness of the paper sold and that respondent relied on such warranty in purchasing the paper from appellant. Under this testimony alone, appellant was liable either on an implied or the express warranty, regardless of whether or not he disclosed his agency or his principal; and appellant cannot complain because Instruction 6 is also asked and given based on appellant's testimony as well as that of respondent. Wilder v. Cowles, 100 Mass. 487. (3) Appellant contends that he should have been permitted "to introduce evidence to show that at the time he sold the notes in question to plaintiff that he did not know that the notes were forged, and that he believed them to be genuine." The trial court, in the second trial of this case, followed this court's opinion in the former appeal in ruling on this point. Had defendant, in the second trial, been permitted to introduce such testimony, such action on the part of the court in admitting the testimony, would, of course, have led the jury to believe that such testimony constituted a defense to plaintiff's cause of action and would have tended to cause the jury to return a verdict for the defendant. It had that effect in the first trial of this case. This question was before this court on the first appeal, was fully considered and decided and should not again be open to dispute or further controversy. Hunt v. Sanders, 288 Mo. 337; Hombs v. Corbin, 34 Mo.App. 393; Crecelius v. Bierman, 68 Mo.App. 34. (4) An agent who enters into a contract without disclosing his principal renders himself personally liable even though the third person knows he is acting as agent, unless it affirmatively appears that it was the mutual intention of the parties to the contract that the agent should not be bound. Porter v. Merrill, 138 Mo. 555; Neely v. State, 60 Ark. 66, 27 L. R. A. 503; Welch v. Goodwin, 123 Mass. 71; Cobb v. Knapp, 71 N.Y. 348; Horan v. Hughes, 129 F. 248; Armstrong v. Brolaski, 46 F. 903.

OPINION

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